Last night I adverted to the position of the Leader of the Opposition as I saw it, and as it appeared during the course of the speech which he made on the Budget. I was contrasting the difficulty of his position with the position of some of his predecessors in the same benches in former times, and I could imagine how vigorously he, on the same lines as his predecessors, would have approached this Budget if it were not for the fact that Fine Gael had completely changed its dress in bringing the Coalition into being and that he now finds himself hampered not merely by that but also by the fact that an election is on and he has to be careful that he will not in his criticism of the Budget appear to be advocating a reduction of social services or using any of the arguments which I know in the past would have been used by Fine Gael when they wanted to suggest that the Budget was demanding too much from the people.
Deputy Costello showed a disposition to attack on the same lines as were followed by Fine Gael in the past, but he quickly retreated. In the old days every item that was down to be met by borrowing would have been questioned by the Opposition. We would have had long extracts quoted here from the Banking Commission Report; the reduction of our external assets would have been pointed out, and we would have had passages from the reports of the Central Bank declaimed here in thundering tones. We have none of these things now for the reason that I have indicated. Whenever the Leader of the Opposition was advancing on these lines he saw the point which he would inevitably reach and quickly changed his course and reverted, naturally, to the old theme which has been the subject of debate here since 1952, the theme that we were unnecessarily overtaxing the people.
He said in 1952 that we were looking to the people for £10,000,000 more than was necessary to meet expenditure. Of course that statement was absurd and proved to be absurd at the time. It did not need proof of any kind, because it was unthinkable that an ordinary democratic Government having to face the people would make itself unnecessarily unpopular by imposing taxation that was not required. We have many times pointed out that such a course would be unthinkable, and that argument has never been answered. Why should any reasonable Government set out to extract £10,000,000 from the pockets of the people unnecessarily? The whole thing was ridiculous. The figures on which Deputy Costello tried to support his statement were proved to be absurd at the time, and the final proof came when the transactions of the year 1952-53 were closed and the accounts made up and it was shown that, instead of having £10,000,000 more than was required, having a surplus of £10,000,000, we had instead a deficit of £2,000,000.
My view at the beginning of the year proved correct. I knew from long experience that, as the year progresses, the Minister for Finance is met with demands from every Department leading to increased expenditure and that it requires a man of tremendous tenacity, supported by the head of the Government, if the head of the Government understands his position properly, to see that the original provisions are so far as practicable adhered to and that expenditure does not get out of bounds. I know how hard it is to do that. I know how hard it is to keep down expenditure, as I have often stated. Man's desires are unlimited. The desires of every Department, of every Minister who sees an opportunity for doing good and who is interested in doing that good but who is at the moment not quite conscious of the difficulty of providing the required financial means, are unlimited. But the means to meet our desires are very definitely limited, and we have to relate our desires to the means we have of satisfying them.
Now I knew that, and I stated that, from my experience, the likelihood was, not that we would have a £10,000,000 surplus, but that we would possibly have a deficit, and so it turned out.
The Leader of the Opposition talks of the £4,000,000 which the Minister is allowing for overestimation and for economies. I said last year, when he made a similar allowance of £3,500,000, and I said in 1952 that experience had proved up to that time that unavoidable Supplementary Estimates come in and that they eat up any economies or any savings that there are. Last year a great effort was made to restrict Supplementary Estimates, but unfortunately unforeseeable things do happen, and it did happen last year that, in spite of our efforts, certain supplementaries had to be introduced. But nevertheless we have in 1953-54 reduced the deficit. Again, I want to point out that we have not overtaxed, that in fact last year we did not provide fully to the extent of £702,000 for our current expenditure. It would therefore be a reasonable charge against us that we did not balance our Budget, and it is not a reasonable charge, it is quite an absurd charge, to go in the opposite direction and say that we are overtaxing to meet our current expenditure.
This year the Minister I think is optimistic in the matter. He hopes to secure £4,000,000 through the usual economies and the usual savings from overestimation—not being able to spend the full amount which it is contemplated in the beginning is necessary to meet expenses—and he is possibly over-optimistic in thinking that we will secure that sum. It can only be secured, as I said last year, if we turn a stern face against supplementaries and, as far as I am concerned, as head of the Government, I will support the Minister for Finance in resisting to the utmost any demands for supplementaries during the year. I think it sets at nought the whole budgeting system, the whole intention of the Constitution in requiring annual budgets to be prepared, if Supplementary Estimates are introduced to the extent that they had to be introduced in order to meet the demands that were entered into by our predecessors and that were not provided for in the 1951 Budget. However, the Minister and his advisers think that the saving can be effected, and it is on that basis that we are balancing the Budget.
Another point has been raised about the additional £1,000,000 which the Minister hopes to get by adjustments concerning C.I.E. The Minister for Finance has explained how that figure of £1,000,000 has been arrived at—the improved conditions and also the repayment which is possible. The adjustment is made possible by the improved financial position of C.I.E. and the fact that it is felt that certain renewals and replacements were proper to be treated as capital expenditure and not as operating charges. These two together enable the Minister on the one hand to reduce the estimate for this year by £1,000,000 as well as to allow, as he has done, £500,000 for repayment in the estimate for non-tax revenue. It would not be legitimate to impose taxation for these purposes when it is not necessary to do so, and, so far from proceeding along the line that has been suggested all the time by the Leader of the Opposition, we are proceeding on the opposite line, that we do not want to have any unnecessary taxation. We know, and we have said from the time we returned to office in 1951 that the limit of taxation which can be met with production at its present level has practically been reached and every effort should be made by the Government to try to relieve the taxpayer to the utmost extent possible. That is the reason why the Minister is careful that there should not be any taxation for anything that is not properly regarded as current expenditure. It is his reason also for endeavouring to the utmost to give any reliefs that are possible, and to give these reliefs to the classes that deserve them most and in the widest way possible; when he found that it was possible for him to make sums available he set out to relieve the sections of the community which seemed to be most hardly pressed, giving certain reliefs in regard to income-tax and also to reduce as far as possible the price of bread.
That brings me to the question of subsidies. Subsidies on an extended scale were introduced here by us when we were the Government in 1947. They were introduced to meet a very difficult situation. Nineteen hundred and forty-seven was in many ways a bad year. The outlook was bad: there had been two successive bad harvests, and the outlook was certainly dark. Nobody could tell what the international situation was going to develop into, and it was in these circumstances, in the belief that they would not be lasting for a long time, that we brought in the Supplementary Budget and tried to diminish the cost of living at the time and to meet what appeared to be a situation that demanded attention and that would not be lasting. Now, when we did that we had to find the money to do it. We reduced, for instance, tea from 4/10 per lb. to 2/8 per lb. The ordinary price at the time would have been 4/10.
We had to subsidise the family budget to the extent of bringing tea from 4/10 to 2/8 per lb. We also brought sugar down from 6d. to 4d. per lb. We brought bread down by I think it was about ¾d. or so per 2-lb. loaf. All these reductions were completely abnormal. These subsidies were abnormal. We have never had them before in this State on such a scale—to tax the community as a whole to come to the relief of individuals, every individual who drank tea or ate bread, used tea and sugar and bread. There had been subsidies before, but the general subsidising of the individual by taxing the community on such a scale was something that had not occurred before and did not occur in most countries at any time except during an emergency period of war. Therefore, we did not think that it was a type of operation which should be continued indefinitely; but the marvellous thing about it was that those who are now altogether in favour of subsidies were the people who attacked them most when they were introduced because they had to be met by taxation.
Is it going to be suggested that they are to be met by borrowing? Are we to meet them from taxation or borrowing? Will the Opposition tell us that? We therefore did our best to meet the current expenditure involved by current revenue, and the only way in which we were able to get the current revenue at the time, the necessary taxation, was by taxing such commodities as tobacco and beer. Of course then we had the cry from the other side. The benefit that was given was ignored. It was said to be slight. But the reality, we were told, was the taxation which was going to meet the benefits. Of course the Opposition will always have it both ways. They will have an craiceann agus a luach, the skin and its price, to use an Irish phrase, always. They will always want to increase services and then they will at the same time want diminished taxation. The thing cannot be done. We do not pretend to be magicians who can do that. If your expenditure goes up, your taxation, the total amount you extract out of the pockets of the people, will have to go up too, and the sooner we make up our minds about that the better. Every time any benefits are brought in the question ought to be asked, how are these benefits to be paid for, what burden do they impose, are these benefits worth the money? These are the questions that should be asked here in any assembly like this whenever any question like this arises. If they are worth the money by all means have them. If they go to increase production that will enable us to lower rates of taxation, to get higher yields in revenue, by all means take them if they are themselves desirable things; but let us not go and live in a dreamland that we can have increased benefits of various kinds of a current character without meeting them from current revenue. The money has to be found and there is no gold coffer into which the Government can put its hand in order to find it. We have tried to face up squarely to the issue, and we faced up to it in 1952 when we found that there was some £15,000,000 of a gap between the amount that could be expected from revenue and the amount that was required in order to meet the current expenditure. We were never told how that £15,000,000 could be met. We were told: "Oh, spend and you will get it in again". A certain amount undoubtedly does come back when you spend like that, but the revenue that comes back is generally far less than the amount that is spent.
We, then, did not overtax the people in 1952, and we did not overtax the people in 1953; and I would like to see those who are speaking on the Opposition Benches tell us what are the items in this account, what are the benefits, which, in their opinion, we ought to cut out. Will they tell us that? They will talk about unnecessary expenditure, but here is the place during the year, and not out at the cross-roads, to come along and say to the Government: "Look here, that expenditure should not be incurred. If you incur that expenditure, it will be necessary to tax the people to pay for it." We do not hear any talk from the Opposition in these terms. Whenever any question of that kind comes up here, the usual cry from them is: "You are not giving enough." If it is a question of old age pensions, they will say: "You should give them 10/- a week more," or if it is a question of unemployment assistance, they will say: "You should give them another few shillings." Every time any question of social benefit comes up, you will not hear them saying: "You are spending too much" or "it will be necessary to demand too much to meet it in the way of taxation." The cry all the time is: "You are not giving enough." Then, of course, when the bills have to be met, when the unfortunate Minister for Finance, whoever he may be, has to come in and try to exact through taxation the sum necessary to meet these bills, the cry is different: "Why is taxation so high; why cannot you lower it?" If you try to lower it, for instance by economies in the personnel of the services, the next thing you will have will be appeals from everybody crying out: "Why are you putting these people out of employment?" Let us have common sense and straight dealing in these matters of finance, anyhow.
We did not, then, overtax the people either in the Budget of 1952 or the Budget of 1953. In fact we did not quite get by way of taxation the sums that were necessary to meet current expenditure. There was no austerity policy. No austerity policy has been adopted by us, unless you call it austerity to try to meet your current housekeeping expenses from current wages or revenue. If that is austerity, it is the only type of policy that will keep any community, any individual, or any family going. We have to meet current expenses from current revenue. If we want to cut down the amount of taxation we take from the people because it is diminishing their purchasing power, as is suggested by some Deputies, then the way to do it is to diminish the services. You can achieve certain economies, as the Minister has been trying to do, throughout the various services but these economies are very far from the millions spent either on social services or capital services. There has been no austerity, then, in our policy. It has simply been a policy of trying to make ends meet. We believe that is the best policy in the long run for the nation. We believe that any other type of policy will ultimately damage the nation.
Now we come to the question of our capital programme. I think it was the Leader of the Opposition who used the phrase that we were sacrificing capital projects to "the sacred cow of sterling." We shall hear a good deal about the increase in capital expenditure that has taken place during our period of office. We shall hear a good deal of that from the hustings. They boasted, of course, that it was the policy of Fine Gael, the policy of the Coalition. "When we were in office," they boast, "everything was splendid". "Buaileam sciath" is the grand motto for them. Everything is splendid as long as the Coalition is in office; all things are well. If we have a huge deficit in the balance of payments, then that huge deficit is all to the good. As was suggested by a speaker in the Seanad, we have a grand nostalgic name given to it, the grand nostalgic title of "repatriation of external assets." It is only repatriation of assets when a deficit is incurred by the Coalition but it is all wrong when a deficit is incurred by us. When they are in office it is simply to the nation's good, they tell us, that these reserves should be exhausted.
I remember their attitude in the early days when we were trying to develop capital projects, and it amuses me now to hear Fine Gael talk about their having introduced the policy of capital development. Housebuilding in this country, in any extensive way, was begun by us. If you call that capital development, there it is for you. Count the numbers, take the statistics, take any other evidence you like, and you will see that the greater part of the work has been done by us. Take the development of electrical power, the utilisation of our rivers for power. I will admit that that work was initiated away back in the 1920's by the former Cumann na nGaedheal Government. That was one of the few things of a constructive kind they did. As I pointed out at the time, we would have begun otherwise. We would have begun with the Liffey where, under a smaller scheme, we would have our own people trained. However, that is past history, but one thing to their credit is that they began that. We have developed electrical power until it has gone far and away beyond what was thought of in those days. We did not, as was suggested by Deputy Dillon, set out to destroy it because it was started by our predecessors. We set out to make the best we could of it and to bring in the Liffey, the Erne and other rivers as quickly as we possibly could. It was we who developed Bord na Móna and the various activities connected with it—the utilisation of our bogs not merely for the production of domestic fuel but also for the production of electric power.
It was we also who went ahead with the development of forestry. We had already set 10,000 acres as an annual target when we were leaving office in 1948. We always pointed out that if land were available, if we could get land for it——
