Dáil Éireann debate -
Wednesday, 28 Nov 1956

Vol. 160 No. 11

Finance (Miscellaneous Provisions) Bill, 1956—Second Stage.

Minister for Finance (Mr. Sweetman)

I move that the Bill be now read a Second Time. As Deputies are well aware this Bill is introduced because of the paramount necessity at the present time that we should do everything possible to stimulate production and exports arising out of increased production. It is part of the general scheme of measures designed towards that end which were announced by the Taoiseach on behalf of the Government on the 5th October last.

Unfortunately we are all only too well aware of the necessity to step up exports to the greatest possible degree. However, it is not always fully appreciated or understood that, in relation to our exports and imports, we have to consider not merely the problems created by the comparative volumes of the one and the other but also the problems that are created by the worsening in the terms of trade, in other words, the position in which we are in international markets forced to pay more for the things we have to import and receive less for the things we have available for export.

In the first three-quarters of this year that worsening of the terms of trade added no less than £10,000,000 to the trade deficit when compared to 1953. It is of interest to note that from 1953 down to the present time the terms of trade were worsening all the time for us whereas from 1951 to 1953 they were improving. The rise in import prices between the third quarter of 1953 and the third quarter of 1956, which are the latest available figures, amounted to 8 per cent. and the fall in export prices amounted to 3 per cent. The worsening that those figures disclosed added no less than £3,000,000 to our import bill for the third quarter of this year and resulted in the receipts from our exports being reduced by £.6 millions. The total of £3.6 millions or one-third of the trade deficit in those months was caused by the worsening in the terms of trade loan.

Those factors make it clear that efforts must be made and inducements must be given to ensure that our production can be increased and that with an increase in production it will be possible to get a greater volume of exports. If we do not get that greater volume of exports we will not be able to sustain imports, including imports of raw material for industry, at the level that all of us would wish. As I said, this Bill is one part of the proposals of the Government towards that end. It is the part that deals with the tax incentive. The main reasons for the introduction of the Bill are the provisions to stimulate coal production and to stimulate exports. In addition to those two main provisions I have also taken the opportunity of adding certain other matters to the Bill which will be of assistance in another way.

The easement of the manner in which wear and tear is given for certain machinery allied to mines will, I think, be of assistance, and in addition I have included in the Bill a provision for industrial building allowances so as to stimulate building activity. The Bill also includes the appropriate provisions to arrange the prize bond issue to which I referred recently and which, as I said then, I hope to introduce early in the new year.

So far as the actual sections and machinery of the Bill are concerned Deputies can see that it is divided into five parts. The first part, which consists of Sections 1, 2 and 3, deals with the normal construction provisions and gives the usual right of appeal from the determinations of the Revenue Commissioners which are included in Section 2 and which are normal in our income-tax code. Section 3 is the section that deals with the wear and tear deduction to which I referred. It provides a more favourable method of computing wear and tear deductions in the case of machinery used in a short life mine or in a smelter working in conjunction with it. Under the section the wear and tear deductions may at the option of the trader—and I would stress at the option of the trader—be computed by reference to the expected life of the mine and the probable scrap value of machinery when the mine ceases to be worked. It seems to me obviously fair that if you have machinery usable only—as apart from its scrap value— in connection with any particular mine, the deduction should be in relation to the length of the operations of that mine rather than the useful life of the machinery and I think it is on that basis that the deduction should be calculated. As I say the option is given in this section for the trader to choose this method if it suits him.

Part II of the Bill deals with the tax relief for profits from coal mining. In Sections 4 and 5 are what one might term the machinery sections. Section 4 deals with appropriate definitions and Section 5 provides that relief under this part of the Bill will be available only to a company which is incorporated, managed and controlled in the State. In so doing it follows the line of the Bill we dealt with here for another type of mining approximately 12 months ago. Section 6 ensures that new coal-mining operations will be regarded as a separate trade for the purpose of assessment to income-tax. It also provides that, in the assessment to income-tax of profits from new coal-mining operations, corporation profits tax will be regarded as having been paid in full notwithstanding that it may be abated under Section 7 of the Bill. The purpose of that is to ensure that the company will get the full 50 per cent. remission. If that provision were not included in paragraph (b) of Section 6, the effect would be that such company would not receive the full 50 per cent. remission but that income-tax would be charged on the part of the corporation profits tax that had been remitted. That, of course, is not our intention, the intention being that 50 per cent. of the profits calculated in this way will be relieved both from income-tax and from corporation profits tax.

Section 7 provides relief from income-tax and corporation profits tax from new coal-mining operations, that is to say, coal-mining operations which are commenced after the 30th September, 1956. The 30th September, 1956, was chosen as the appropriate date as being the last day of the month prior to the announcement by the Taoiseach on behalf of the Government that a concession such as this was about to be introduced. The section accords a 50 per cent. exemption from income-tax for the year of assessment in which the new mining operations are commenced and subsequent years up to and including the 5th April, 1967. There is also granted a 50 per cent. exemption from corporation profits tax for accounting periods and parts of accounting periods from the date of the commencement of the new mining operations up to the 30th September, 1966. The difference between the two concluding dates arises, of course, because corporation profits tax is charged on the actual period rather than the income-tax year.

Section 8 provides relief from income-tax and corporation profits tax in the case of profits from existing coal-mining operations. The section lays down that, over a period of ten years, income-tax and corporation profits tax for each year on profits referable to an excess of the volume of output of coal over the volume of output of coal in the year ended 30th December, 1956, will be relieved to the extent of 50 per cent. The ten year period as regards income-tax may begin with any one of the three income-tax years ending on the 5th April, 1960. The option to choose which year it will start, again, rests with the company concerned. As regards corporation profits tax, the ten years' period begins on the 1st October, 1956. This section also provides that, in the assessment to income-tax of profits from existing coal-mining operations, corporation profits tax will be regarded as having been paid in full notwithstanding that it may be abated under the section. That provision is, of course, for the same reason as that applying in the earlier section to which I previously referred.

Section 9 deals with the dividends paid by coal-mining companies which obtain relief under this part of the Bill. The rate of income-tax which may be deducted from any such dividend is to be reduced by reference to the relief and any repayments of income-tax are to be governed accordingly. The section also provides that no relief under this part of the Bill will be given in respect of any income which goes to pay charges, such as debenture interest, from which the coal-mining company is entitled to deduct income-tax.

It is further provided by this section that, where a reduced rate of income-tax is deductible from a dividend under this part of the Bill, the amount of the dividend will, for surtax purposes, be reduced to correspond with the reduction in the rate of income-tax deduction.

Those sections cover the provisions in relation to coal-mining. I hope and I believe that, with the introduction of this Bill, containing now those sections dealing with coal-mining, we will succeed in obtaining in relation to what coal deposits there may be in the country the same degree of interest and activity as we have already obtained in respect of what I may roughly call metallic ores by virtue of the tax incentives that were introduced last year. Nobody can deny that, following the introduction of those tax incentives last year and the arrangements that were then made, we have—we are all glad to see—far more interest in mining in Ireland than ever before in the history of the State.

Part III of the Bill deals with profits from exports. The appropriate definitions are contained in Section 10 and the standard period is defined in Section 11 as being the year to the 30th September, 1956. This period will apply even though the company which carries on the trade in the year of claim may not be the person who carried it on in the year ending on the 30th September, 1956.

Sections 12 and 13 define the scheme of relief from income-tax and corporation profits tax under this Part of the Bill, the former section dealing with income-tax and the latter with corporation profits tax. The sections provide, in effect, that, over a five-year period, tax for each year on the profit represented by an increase in the value of a company's exports of manufactured goods, that is to say, goods manufactured by the exporter, over the value of such exports, if any, in the standard period, shall, in so far as that profit is used in the development of the company's business in the State, be reduced by 50 per cent. The five-year period as regards income-tax may begin with any one of the three income-tax years ending on the 5th April, 1960. Again, it is for the company concerned to decide, at its own option, in which of these three years it wishes the relief to begin. As regards corporation profits tax, the five-year period begins on the 1st October, 1956.

Section 13 also makes provision for the necessary apportionments for purposes of corporation profits tax where relief is claimed for an accounting period of less than 12 months or where there is a transfer of a part of a trade.

The section also prescribes that, in the assessment to income-tax of propose fits from exports, corporation profits tax will be regarded as having been paid in full notwithstanding that it may be abated under this section.

The House will note that in relation to the relief on exports it has been provided in these sections that the profit must be used for ploughing back and in the development of the company's business. I think everybody will agree that that is a desirable provision. That provision is not included in relation to the coal-mining provisions because mines are a wasting asset and it would not be realistic to include the provision in relation to coal mines.

Section 14 provides for the owner obtaining the relief from tax because there is a succession in the trade or where there is a transfer of part of a trade or where permanent cessation in a trade occurs. In relation to exports, as apart from coal mining, there is not uniformity of exports; it is not possible to relate the profits to the volume in the same way as it can be related to volume of coal. Accordingly the House will note that in this part of the Bill the standard taken is of value and it is by reference to the increase in the value of exports that the concession applies.

There is the same exemption in Section 15 of this part of the Bill as there was in the former portion to which I have referred in regard to debenture interest and so forth. When a company is entitled to retain from the payee tax from his interest it would not be right that it should get relief for such tax so retained. The section accordingly deals with that.

Part IV of the Bill deals with the industrial building allowance. Section 16 provides for a deduction of 10 per cent. of the capital expenditure incurred by a trader on or after the 13th September, 1956, in the construction of any industrial building to be occupied by him.

Section 17 defines the building or structure to which the allowance applies. The buildings are those used for the pursuance of the trade such as a mill, factory or other similar premises or building for the purposes of hotel keeping. I think everybody would agree that it is desirable that industrial building should be stimulated and that everybody will also agree, having regard to the importance of the tourist trade as an invisible export, that it is desirable to include hotels in this provision. The effect, I hope, will be that hotel keepers will now realise that under this concession it would be wise, not merely for the country as a whole, but for their own sakes, to go ahead and build new hotel accommodation so as to ensure that the amount of accommodation available will be such as to meet the need which we have if we wish to increase our tourist trade.

Section 18 defines the basis period by reference to which the industrial building allowance is to be granted. Normally the basis period will be the accounting period ending in the year preceding the year of assessment.

Section 19 provides that the industrial building allowance should not be given in respect of expenditure incurred in the acquisition of a site, or for work on the site except in so far as it relates to the preparation of the ground for the purpose of receiving the foundations of the building.

Section 20 enables a company to obtain an industrial building allowance in relation to corporation profits tax where it would be eligible for such allowance in relation to computing income-tax.

I think Deputies will recollect that there has been pressure for some considerable period for an industrial allowance for buildings of the type such as I have provided for in this section of the Bill and I feel sure that its effect will be to stimulate industrial building and therefore greater industrial production in the way in which it is desired.

As I mentioned in the beginning I am also taking advantage of this opportunity to include in the Bill the appropriate reference to prize bonds and Part V of the Bill provides the legislative authority required in connection with the issue of prize bonds. Prize bonds will differ in important measures from existing State borrowing. Instead of earning interest or dividends they will participate in drawing for substantial cash prizes free of income-tax and surtax. They will not be dealt in on the stock exchange but will be repayable in full at any time. They will combine full security with the chance of a large capital money prize normally found only in a speculative venture. Prize bonds will form a useful addition to the existing measures for the encouragement of savings and should appeal to a large section of the community if not to all. There is a considerable public demand for opportunities to win large sums of money and the State should not ignore this fact in its efforts to obtain money in respect of capital development.

Prize bonds will have an outstanding advantage in that regard in that the money cannot be lost and that it may be recovered by the owners whenever they wish to do so. Because of this also it is proposed to exclude the scheme from the scope of the Gaming and Lotteries Act of 1956. In addition, the House will note that under Section 24 I have provided exemption from stamp duty in respect of certain documents which will have to be utilised in connection with prize bonds.

I recommend this Bill to the House as part of a scheme to provide, by tax incentive, additional production in coal mining and additional production for export. The success which followed the introduction of the Mineral Tax Concession Bill in the early part of this year is, I hope, a happy augury in relation to the coal-mining provisions included in this Bill. The provisions that are included here in relation to profits from exports should now enable our industrialists to go out and, with the additional facilities they will now have available to them, be able to seek foreign markets, markets outside this country which are so desperately necessary in the national interest. The industrial buildings allowances should assist in modernising factory premises and in the erection of new premises. The Prize Bonds Scheme will form a useful addition to the manner in which the State, for the purposes particularly of production and capital projects, can obtain the funds necessary for these projects. For all these reasons, I commend the Bill to the House.

Mr. S. Lemass

The Minister made it quite clear in his opening remarks that he approached the preparation of this Bill not as an exercise in taxation reform but as a temporary device to deal with present conditions in this country. It is on that basis the Dáil should consider it.

The question we have to ask now is whether the proposals in this Bill, which are the Government's proposals or at least, the main part of their proposals, for dealing with present conditions, are adequate to offset the present trade depression, the decline in industrial production, the diminution in employment and the general weakening of the national economy which has developed in this year? Will this Bill help to get the country back into the position in which it was in 1954, into the position in which production and employment will increase, in which the adverse trade balance will disappear and in which the prospect of national advancement will appear to be a continuing one?

What are the proposals in the Bill before the House? There is a proposal that there should be a remission of 50 per cent. of the taxation payable on profits earned on export trade by new companies or by existing companies which increase their export trade, in relation to the profits earned on the increase, and provided they use the whole of the profits so earned for the development of their businesses and distribute none of them to their shareholders. There is also a 50 per cent. remission of taxation upon profits earned by new coal-mining companies or existing companies which are able to increase their production and earn profits in so doing. There is a proposal for an initial allowance of 10 per cent. in respect of new industrial buildings and a minor alteration in the rules governing the depreciation of plant used in mining operations.

The aim, we are told, is to facilitate and induce increased exports and increased production generally to deal with what the Minister has described as the "desperate situation" of the country. I do not think there is any Deputy here who will for one moment believe that the proposals in this Bill will have anything but a minor effect upon that situation. Let it be said straight away that the Bill gives some aid to those who are trying to expand production and exports in certain industries. To that extent it represents a welcome change of mind on the part of the Government because both the main proposals in this Bill were resisted by the Government earlier this year when this situation was being debated and these proposals were put forward from this side of the House. I am certain that it will not be seriously contended by any Deputy that these proposals go nearly far enough to give us the results we require. So far as is known, the deficit in our external payments is approximately £35,000,000—at any rate that was the deficit in 1955. What the outcome of this year's operations may be, we do not yet know. There has been, we are told, some improvement in the visible trade balance, a diminution in imports greater than the diminution in exports.

In 1955, according to the information available to us, there was a not inconsiderable expansion in the trading stocks held in this country and in work in progress generally. The Central Bank in its report estimated that in 1955 there was an increase in stocks in that year of approximately £13,000,000 and to some extent the deficit which emerged in our international payments in 1955 was attributable to that increase in stocks. Since then, because of trade depression, because of special import levies which the Government has imposed, there has been, as everybody knows, a substantial decline in industrial stocks and, in so far as there has been a contraction in imports recorded for this year, it is mainly attributable to that letting-down of stocks. It does not reflect any permanent improvement in the circumstances of the country.

The Government's measures have in effect transferred some of this year's deficit to next year, because eventually these stocks will have to be replenished. Indeed, it can be argued seriously that in present international circumstances it is undesirable that our commercial stocks should be contracted. One would prefer to see, in view of possible developments in the world situation, an accession rather than a depletion of stocks at the present time.

There can be no permanent improvement in the circumstances of this country until we expand our production generally and expand our exports in particular. In so far as this Bill indicates a recognition by the Government that that is desirable, it is to be welcomed; but it is undesirable and detrimental to the realisation of the aims, which the Government professes to have, to have Ministers speaking in public referring to the trade statistics of this year as representing an improvement in the national situation, a permanent improvement which suggests that the crisis confronting the country is passing. That is not true. There has been no permanent improvement at all in our trade situation.

The improvement in the visible balance of trade is due mainly to the depletion of commercial stocks and not to any rectification of the position. The position can only be rectified if we can get increased production to replace imports and to expand exports. I want to suggest that there is nothing in this Bill which is sufficient in present circumstances to induce that result. We need increased exports so that we can pay for the goods we have to import. It is not desirable that we should have to restrict the import of goods that we cannot produce for ourselves. Many of these special import levies imposed by the Government are operating to depress the standard of living of our people, to make it impossible for them to acquire goods, which they would like to have and the possession of which would mean for them a higher standard of living, because such goods are now priced out of their reach.

Many of these levies apply to industrial raw materials and are operating to contract industrial production and, in some cases, to terminate export businesses which had prospects of expanding. I do not know what the attitude of the Government is to these special import levies. I do not believe it is possible for any body of men, no matter how clever, to devise a whole series of new taxes—68 new taxes were imposed in one Order last March and further taxes were imposed later in July—without making some mistakes in definitions. I am quite certain that the Government did not know at the time they were fixing these taxes that under them many industrial materials would be caught and that industrial production would be hampered and not helped by them. Yet, they have, apparently, up to date refused to consider any modification of the taxes, any alteration in the definitions even when the need for it was brought forcibly to their notice by firms affected by them, that unless they got duty-free raw materials to maintain their production they would have to contract it, disemploying their workers. At any rate, so far as the general national position is concerned we have to record that instead of the increase in exports upon which the nation's safety depends exports are less this year than they were last year and the indications are that they will continue to contract. I doubt if there is in this Bill any provision which will arrest that decline.

I have attempted to calculate from the information available to me the total increase in production which is required to enable this country to maintain the 1955 standard of living for the 1955 population, and at the same time meet its external payments. My calculation suggests a 20 per cent. increase in the output of both agriculture and industry is required, and instead of getting that increase, we are getting a decrease and production is going down. Again, I suggest that the proposals of the Government to arrest that decline in production—much less expand production to the degree required—are completely inadequate.

I have urged that members of the Dáil should consider the proposals of this Bill in relation to the urgency of our circumstances. I concede it does offer some advantage to certain firms engaged in some industries. I assert, however, that the proposals in it, indeed the whole series of proposals announced by the Taoiseach in his speech some time ago, are completely inadequate in relation to present conditions. We need quite substantial alterations in our programme, quite substantial inducements to producers, if we are to get that expansion of production, that increase in exports, that spur to enterprise which will give us the higher output and exports which the country requires.

When these matters are discussed, Ministers frequently defend themselves by pointing to the fact that the previous Fianna Fáil Government did not create inducements of this kind, did not change the tax laws relating to mining undertakings, or give tax inducements to firms engaged in exports. That is correct. It may be that previous Governments are open to criticism on that account but the fact is that the need for these measures never previously existed as it exists now. The problem with which the Government is inadequately coping and with which the country is faced is one which has developed since 1954 and I think it would be a good thing for public morale if Ministers would concede that, and relate their proposals to a situation which has developed entirely during the period in which they were responsible for national affairs.

In the period 1953-54, production was increasing. It was not increasing as fast as we would have liked it to increase but nevertheless employment was going up and unemployment down. The rate of progress was not as rapid as we would have wished but we were going in the right direction and exports were increasing. In that period we had no serious problems relating to international payments. What is more than that, we were able to maintain a capital investment programme by public authorities which was probably as extensive as it was possible to organise, and which was providing this country with the amenities of a modern civilised State and getting rid of many of the remaining legacies of foreign rule and certainly giving employment to many tens of thousands of Irish workers, employment which is now contracting.

The very serious deterioration in national circumstances which has taken place since 1954 cannot be remedied by pettifogging methods. If the situation is to be remedied at all, it calls for far more effective stimuli to producers and exporters than this Bill provides. Once again, in this Bill the Minister has persisted in preserving the pernicious principle of discriminating in taxation between firms engaged in the same business. There is no benefit under this Bill to a coal-mining concern which is already working to the limit of its practicable capacity. There is no reward in this Bill for a firm which has already pioneered in the export market and which is sending goods abroad to the maximum extent for which it can find sale for them. So far as they are concerned in future they will be at a disadvantage in competition with new competitors in their own business and in some instances, particularly in relation to coal mining, that disadvantage may prove very considerable.

I think it is wrong in principle and likely to prove ineffective in practice to maintain that system of discrimination. It is all right now; the Minister may argue that he wants this to stimulate an increase in production or in exports over the present level, but in three, four or five years' time, the origin of this measure will be forgotten and we shall merely have a picture of two firms side by side doing the same job, one being taxed at double the rate of the other. That principle is indefensible.

I realise that if the tax concession was given generally to all firms it might mean in relation to certain cases and particularly in relation to firms engaged in the production of beer, spirits and tobacco a serious loss to the Exchequer, and it might be said for that reason, it is necessary to withhold the tax concession from firms already engaged in export business. If that is so, we at least urge that the Government should decide the particular industries it wants to encourage, that have export possibilities, and give the concessions to every firm in these industries.

If the Government does this, they will get not merely a better response now in the matter of increased business but they will have avoided this charge of unfair treatment of the most enterprising firms in this country. It is the firms that have already gone into the export market that are most likely to expand their production but they get least advantage under this Bill. It may be because of these tax concessions new firms will be induced to locate industries in this country but I do not think the measure goes nearly far enough for that purpose having regard to the tax laws already operating in the countries from which these firms may come.

Let us consider the position in relation to the coal-mining industry. I can speak with some knowledge on this as I am an unpaid director of a small, non-profit-making, coal-mining concern. I make both points clear in case anybody might think I have a personal interest.

During the debate on the Bill giving tax concessions to the company that will work at Avoca, I urged that the principle of that Bill should be extended to coal-mining undertakings. The Minister argued against it at the time. He has now gone back on that a little. He has not put coal-mining firms on the same tax basis as firms that work non-bedded mineral but, nevertheless, he has set out to improve the position a little. That is to be welcomed as a concession to equity, as a more intelligent arrangement of the taxation laws of the State, but it may not get one additional ton of coal produced in this country.

It may get some new concerns to start. I admit that. However, the practical thing which at present prevents any increase in the output of coal is the inability to get competent workers to go underground to the coal face. It might be possible to get additional workers if housing facilities were made available. I know the suggestion has been put forward to the Minister for Industry and Commerce for an arrangement under which housing could be provided for people working in coal mines similar to those which operate in relation to the turf development schemes. There are coal-mining concerns which can attract back here to employment Irish workers in Great Britain, provided they can offer them housing facilities.

At the present time there is competition between firms engaged in coal mining to attract workers from one another because output depends on the number of workers on the coal face. If a new mine starts in any of the areas in which existing coal mines are operated they may be able to take workers from the existing mines. The only effect of this Bill will be to give new firms some advantage because they will be exempt from taxation, when the existing mines will not be so exempt. I do not know whether the possibility of increasing coal production, which it is eminently desirable should be increased to the maximum, has been considered by the Government as a whole or whether it is the concern of the Minister for Finance only. I know that representatives of the coal-mining industry have met the Minister for Industry and Commerce time and again, to discuss the position with him and trying to get action which would enable them to cope with these difficulties.

Side by side with these difficulties under which existing coal-mining firms are operating are still more serious ones. We had an announcement in the papers that in Arigna 50 or 60 workers have been laid off because of inability to dispose of coal produced in the area—an area in which it is planned that a power station would be operated by the E.S.B. next year and which should be stocking up all the coal that can be produced in that area at the present time. If there is any serious intention on the part of the Government to get increased coal production they would have noted the report that miners are being laid off in one part of the country because the coal cannot be sold at a time when the State concern which will be the ultimate sole market of that coal is frantically trying to increase its supplies from abroad and should, at the present time, be laying in reserve stocks to ensure that the station will be opened and will operate to schedule.

These problems of expanding coal production in this country should all be considered by the Government. I think it is probably true to say that, assuming the practical difficulties in coal production could be overcome, money for investment in coal-mining would be available. I urge upon the Minister that, in relation to the difficulties in the coal-mining industry, he should introduce measures, not temporary measures to ease present difficulties but for the permanent future of that industry.

The biggest outlay of capital in the opening up of a new coal mine or the extension of an existing one goes into the acquisition of the mine itself or into its development. A large portion of the total capital outlay occurs before one ton comes out of the ground. All that capital has to be recovered out of profits within the lifetime of the mine. Every other country has recognised the necessity for making some taxation arrangement which will facilitate the recovery from profits of the total capital invested in the undertaking; there is a depletion allowance which takes into account that the mine must cease to operate when the deposit is exhausted and which is designed to enable those who have invested in the undertaking to recover their investment within its lifetime. Up to recently this arrangement did not exist in Britain but the British Royal Commission on Taxation has recommended its introduction and it is to be assumed it will be introduced there.

I believe if such an arrangement were introduced here it would be a greater inducement to investment in increased coal production than the proposals of this Bill. The proposals of this Bill will not benefit even new mines unless they get into the profit earning stage. Some of the existing mines are making no profits at all and in most cases where a profit is earned that profit has to be retained for the purpose of building up a reserve against capital expenditure which has to be recovered while production is still possible.

If possible, I think it is necessary to get a change in the attitude of the Revenue Commissioners on the determination of what is capital expenditure and what is ordinary working expenditure in the operation of a coal mine. I have had a case brought to my attention in the past two months. In a certain coal mine in this country the main road leading to the coal face had grown so long that a new outlay upon the extension of the conveyor system became necessary. Deputies will appreciate that as a coal mine is worked out, the coal face gets further and further away from the shaft and that the operation costs tend to increase the longer the mine is in operation. In the case of this coal mine, the time was reached when the conveyor system had to be extended to meet this difficulty. The extension did not add one ton to output of the mine, yet the Revenue Commissioners held that the expenditure on the extension was capital expenditure and not a working cost, and consequently not deductible from profits when the firm was being assessed for taxation. That is a most stupid outlook.

Mr. Sweetman

Surely it is not orderly for the Deputy to refer to an official of my Department as stupid, particularly when this was an appeal to the Circuit Court against a determination by the Special Commissioners.

Mr. S. Lemass

I should certainly not agree to have the precedent established that it is not open to a Deputy to describe as stupid a decision of the Revenue Commissioners.

Mr. Sweetman

It is a decision of the Special Commissioners on appeal to the Circuit Court judge.

Mr. S. Lemass

These are matters of which I know from practical experience and likely to have far more influence upon the decisions of individual companies or coal mine proprietors, whether or not they would expand their production under the proposals of this Bill. If the Government is serious in its desire to get expansion in coal production in this country, then it is to these matters it should be giving its attention as well as granting the tax allowances proposed here.

We also have a proposal to give tax allowances to new firms that engage in export trade and to existing firms who increase their export trade in relation to that increase, subject to this condition: that the profits derived from exports are not under any circumstances to accrue to the benefit of the shareholders of the firm but must be retained for the development of the business. I do not know how that is to be made effective. I think a child of ten would be able to devise without difficulty ways and means by which the profits of the concern could be arranged so that the dividends could be paid and allowances earned at the same time, except in the case of a firm doing nothing but an export trade. In that case apparently there could be no distribution of dividends at all.

The Government's objectives in putting forward this proposal are twofold. Firstly, to induce existing Irish firms to get into the export trade or to extend the scope of their activity in that regard. Secondly, to induce foreign firms to come to this country and use it as a base for export trade. Let us face up to the fact that any firm in this country going into the export trade is at substantial disadvantages. Most of the industrial raw materials which are processed here have to be imported and the comparatively small size of our undertakings generally mean they cannot be purchased to advantage as might be the case with much larger undertakings. In the main, our production costs are higher, again primarily due to the relatively small size of our undertakings. Our transport costs abroad are frequently very much higher. As most Deputies know, there are very high freight charges operating on most of the shipping lines from this country to continental ports. In many cases export abroad is only possible by means of transhipment at a British port. In all cases it has to be recognised that these transport costs are a very considerable deterrent to an expansion of Irish exports. In one particular case I was interested in, where I tried very hard to arrange circumstances so that such a trade would become possible, the whole idea was ultimately killed by reason of the high transport charges which had to be met.

All these disadvantages can be reduced but none of them can be eliminated entirely. To the extent that they cannot be eliminated we have got to offset them by our system of taxation or by giving some other advantages to firms prepared to enter the export business. In the Six Counties these firms pay no local authority rates and they get other forms of State assistance. In the past we argued that the very substantial aid given in the Six Counties to firms entering into manufacturing business there did not have to be imitated here because we could give on our side what they could not give: the much greater advantage of a protected home market. But when we come to talk about export business every advantage which these firms have is a real advantage compared with firms operating here, and if we are to get trade in the same markets we shall have to give quite substantial advantages here also.

To get the export trade in manufactured goods extended by the required amount we need to be thinking of very substantial advantages indeed. If we are to get capital invested in that trade—and those who have control of capital for investment will fully understand the risks involved—then we must do at least as much as other countries are now doing to facilitate and help their export industries. When the Finance Bill was under discussion here I urged that the tax concession should take the form of a complete remission of taxation on profits in the same proportion as the exports of that firm have to their total output. That was put forward to the Commission on Industrial Taxation by an organisation called the Irish Exporters' Association. I urged the Government to adopt it. At that time the Minister relied entirely on the fact that the Commission on Industrial Taxation had recommended against any tax concession to encourage exports.

I think a tax concession of that kind is necessary. I do not know if the members of the Government appreciate that there are countries giving tax concessions to exporters as substantial as that. It is against other firms in other countries that our firms have got to get business abroad. We cannot afford to do less than they are doing and in our circumstances, having regard to the urgency of our need to expand exports, we may have to go even further still. I have good reason to know that, if concessions of that kind were allowed and if there was in addition to the initial allowance or in substitution for the initial allowance which the Minister brought in the Finance Act, an investment allowance such as that which the British Government had in operation until last year, we would get quite substantial results.

Some firms will never venture abroad. They are doing all right as they are and they have lost any spirit of enterprise. But there are some very enterprising firms in this country directed by men who are prepared to measure their capacity to find trade and produce goods against the leaders of industry anywhere, if they are given by the Government the necessary aid and the necessary inducements to pioneer in the export markets.

I do not know what the words in that section of the Bill which purport to define goods mean. This is Section 10 of the Bill in Part III relating to the granting of tax concessions for exports. Goods are defined as "goods manufactured within the State by the person who exports them." There are two points arising from that. The first is the limitation of the concession to firms that export the goods themselves. One of the main weaknesses in our whole economic organisation is the absence of the type of enterprising merchanting house which they have in Great Britain. Many of the British manufacturers do not export themselves. Their goods are exported by merchanting organisations which handle the products of many firms and which maintain their agencies and contacts in most countries of the world. I see no reason why this concession should be limited to goods which are exported directly by the firm which produces them. Indeed there would be many advantages for this country if, through granting of further concessions, we could develop that type of merchanting organisation upon which the prosperity of Britain was built up.

The main point I have in mind here is the vagueness of that definition. I presume the Minister intends that meat would be regarded as goods for that purpose, that if a meat slaughtering concern buy cattle in a fair, slaughter and dress the meat and export it, that they are manufacturers within that definition. Would a person who dresses chickens be a manufacturer within that definition? Every manufacturing operation consists of the buying of raw materials from somebody and the processing of those materials into some commodity or article that the public require. I suggest that a far more precise definition of "manufacture" is required in the Bill.

Mr. McQuillan

Turning old hens into chickens?

Mr. S. Lemass

All right. Would turning old hens into chickens for the purpose of export be a manufacturing operation? I think the Minister and the Revenue Commissioners will get into immense difficulties unless that definition is tightened up.

I am not arguing for the exclusion of any type of operation which involves the processing of materials into a form which will make them more acceptable to the public abroad but there should be some minimum value added to the raw materials by the processing before anything like manufacture could be accepted as having occurred.

Given the tax concessions of the kind that I have suggested, and investment allowances and depreciation rates such as those that operated in Great Britain up to last year, and certain other assurances, such as those that would refer to the right of repatriation of capital and profits, the right of foreign technicians to send part of their wages home without restriction, I believe that it is possible to get certain firms now operating abroad to establish factories in this country to supply part of their export markets.

I say that, because I have had discussions with representatives of such firms and other people who might be able to influence them and I have always come up against the fact that I could not indicate that there were advantages in this country greater than they had in their own countries which would bring them here, even though they might desire to come here for other reasons. I do not believe that we can get them here unless the trading advantage which they can see themselves securing by accepting an Irish location is big enough to get the right decision made by their boards of directors.

It may be necessary also to amend in some respects the Control of Manufactures Act. I indicated at one time my willingness to suggest certain amendments to that Act. I do not propose to do it now—I do not suppose it would be in order—but, in so far as we have in mind firms of substantial size, I have always thought it would be practicable to exclude them from the scope of that Act, that is to say, firms with a paid up capital exceeding, say, £500,000 or £1,000,000. Where there is investment of that kind in this country, the dangers which we foresaw when the Control of Manufactures Act was passed are not likely to arise.

It is quite clear that, if the Government is hoping through this measure to arouse significant foreign interest in Irish industrial possibilities, they are not going far enough. They have tried. They have sent their Minister for Industry and Commerce abroad on various missions and nothing has come of it. I do not know if there is any project under discussion which could be directly attributed to any of these visits but the information given to me in reply to a parliamentary question the other day indicated that, up to the present at any rate, nothing has emerged from that effort. I hope the Government has learned the lesson of it, that people will not come in here to invest substantial capital sums in industrial activities in this country merely because some Minister goes and asks them to do it. There has got to be, for business people, a solid, practical reason why they should come and we have not given that reason yet. Indeed, the proposals in this Bill, as I have said, give to possible new industrialists far less in the way of tax relief than they are already enjoying in the countries in which they are now operating.

We have also this proposal to grant initial allowances in respect of industrial buildings. The Commission on Industrial Taxation recommended that an initial allowance of 10 per cent. should be granted, that, in addition, there should be an ordinary depreciation allowance which would enable the cost of buildings to be recovered over 50 years; a wear and tear allowance of 2 per cent. per year. There were other proposals also.

When the Finance Bill of this year was being discussed, the Minister pleaded that he had not had time to consider fully the recommendations of that commission and, consequently, was not acting on them on that occasion. He has had plenty of time to consider them since and I take it that the production of this Bill, with its proposals for an initial allowance only, means that he has rejected the other proposals of the Commission on Industrial Taxation.

I want Deputies to understand what that means. In relation to a series of proposals which the Minister hopes will induce a substantial increase in production and of exports of industrial goods, it means that, in respect of that element of taxation, we are much more restrictive than they are in Britain or in Northern Ireland.

What the Commission on Industrial Taxation recommended was that we should change our tax laws so as to give this depreciation allowance in respect of industrial buildings, to bring it into conformity with the law of Great Britain. Initially, the income-tax laws of both countries were the same. They have tended to diverge in the 30 years since the State was established. In this one respect, the Commission on Industrial Taxation recommended that we should adopt the same principles as apply under British law. The Minister, presumably, decided against that course. Do they think it is really helping to get people to come in here to establish businesses for the conduct of export trade when we will not give them even the same tax arrangement as they can enjoy if they go north of the Border and put their factory in the Six County area?

I would suggest that, not merely should the proposals of the Commission on Industrial Taxation be adopted, but that we should do what the British did —we should change the initial allowance, which is only a loan of the depreciation fund and ultimately costs the Exchequer nothing, into an investment allowance. The British Government, in their desire to expand their industrial output in the years after the war, operated the system of investment allowances which was a real help to British industrial expansion, so much help that British industrial expansion ran ahead of the target and the British Government withdrew the allowance in order to slow it down. There is no likelihood that our industrial progress will run too fast for us but, at least, let us use the stimuli, aids, and devices which other countries have found effective. However, I should like the Minister to tell me, am I to take it that the introduction of this Bill, with the solitary proposal for an initial allowance in respect of industrial buildings, means that the other recommendations of the Commission on Industrial Taxation have been rejected by the Government?

I shall not comment at this stage upon the proposal in relation to prize bonds. I do not know what amount of money the Government thinks is likely to be raised by that device. The great bulk of the funds that have flowed in the past into Government loans have come from sources where a known rate of interest was the predominant factor. Pension funds, trust funds of various kinds, reserves of industrial companies, the funds of insurance companies—these were the sources of most of the contributions to national loans in the past. They will have no interest in these prize bonds.

In this case the interest depends entirely on one thing and that is that there may be amongst the general public a desire to utilise these bonds because of the guarantee of the stability of their value with a prospect of a prize of a sum of money. This scheme has been tried out in Britain, and I take it the Minister has adopted this method of raising capital funds because it was adopted in Britain.

Mr. Sweetman

Nonsense.

Mr. S. Lemass

Some months after Mr. MacMillan adopted this scheme in Britain the Minister conceived the same idea.

Mr. Sweetman

Would the Deputy take the trouble to look up speeches on this subject made two or three years ago?

Mr. S. Lemass

The House should be told what success they had in Britain. In Britain they have an urgent need to draw off excess purchasing power but here there is a definite need for the Government to increase the resources available for capital expenditure because at the present time there is a curtailment of capital investment proceeding with drastic consequences to the country which requires that some step should be taken towards remedying the mishandling of the country's finances.

We will have many amendments to submit to this Bill. It is capable of being amended and improved in many respects. So far as I can see there is no special urgency about the Bill except perhaps with regard to the part dealing with the prize bonds. The Government may require to get that part passed quickly. With regard to the rest of the Bill we are of opinion that it is in much need of improvement and that the Dáil should be given time to consider proposals to amend it. If there is any urgency about the prize bonds I would suggest that the Minister should take that part out of the Bill altogether.

Mr. Sweetman

Is the Deputy serious? The Deputy's Whips' office told me, after they had been in touch with the Deputy, that all stages of the Bill would be given to me before Christmas.

Mr. S. Lemass

Why do you want it before Christmas? Can you give me any good reasons why a Bill of this kind should be rushed?

Mr. Sweetman

There is no need to rush it.

Mr. S. Lemass

There are Deputies who would like to have an opportunity of discussing it with various people outside the house who would be interested in the Bill and capable of improving it by suggesting amendments. These Deputies are not on one side of the house alone. I am sure that there are Deputies behind the Minister who are anxious to discuss it with people outside the house. The Dáil should have that facility unless there is a good reason against it.

Mr. Sweetman

I am asking the Deputy if he is going back on his specific statement conveyed to me through his office. I pointed out to his office that it was desirable to get all stages of the Bill through the house before Christmas and the reply came, after consultation with Deputy Lemass, that that would be agreed to.

Mr. S. Lemass

What you were told was that if the Minister regarded it as necessary to get the Bill before Christmas we would pass it.

Mr. Sweetman

That is not what I was told.

Mr. S. Lemass

What is the hurry with the Bill? If there is a good reason to pass the Bill before Christmas we will pass it but if there is no good reason I would ask that we should not rush the Bill so as to give Deputies an opportunity of examining it at leisure and discussing it with their constituents. I do not think that, to the extent that the Bill is an inducement to expand production and increase exports, a delay in enactment will have any effect. Business people will act on what they know will be in the measure. The Government's intentions have been expressed in the Bill as submitted to the Dáil and so far as any beneficial results may follow from the Bill they will begin to operate now. It is a Bill that should not be rushed through the Dáil at the end of a session and it is not our fault that the Minister was so dilatory in introducing it. If the Minister gives us a good reason why the Bill should pass quickly we shall try to produce the amendments next week but without such a good reason we do not see why it should be rushed.

Mr. M.E. Dockrell

I welcome this Bill as being a step forward in facing the realities which we, in this country, ought to face in connection with enlarging our industrial arm. I think that the Bill can only have a good effect. It can help us to develop our industrial side and to make it more efficient. Every person engaged in industry in this country has realised that, on the one hand, whilst we were encouraged with fair words to increase manufacture and increase industrial activities generally, on the other hand the practical steps which should have been taken to bring about that state of affairs were not taken.

One of the greatest handicaps which industry has suffered from in this country is the fact that we have had an unrealistic income-tax approach to the whole question of industry. The best way for existing industries to increase their trade and their efficiency is to do so out of profits. We have not, as a country generally, shown that we really realise the necessity for that.

Deputy Lemass has welcomed this Bill and he also said that he thought that it ought to have gone further. I would say to Deputy Lemass, and I do not say this for any political reason, that it is a great pity that during the many years when he was Minister for Industry and Commerce he was not able to persuade successive Ministers for Finance that we would not get very far in our efforts for industrialisation unless our finance policy towards industry marched hand in hand with our desire to extend our industrial arm. This is, as I say, a step in that direction.

It mainly helps people who are engaged in coal-mining operations and those who are engaged in export trade. Naturally, it is to our advantage to do all we can to help exports. I am sure coal-mining operations are equally of considerable importance to the country generally. There are, however, other types of manufacturers who, whilst they may not at the moment actually be engaged in export trade, may in the future, if adequate taxation reliefs are given, be in a position to build themselves up into becoming exporting firms. That is one point. Again, whilst any firm is engaged in producing a manufactured article for sale that firm is in some degree or other helping to prevent the import of a similarly manufactured article and, from that point of view, it is only a step or so removed from actual export trading; if it is not actually exporting, it is certainly preventing the export of money, money which we need at home.

Looking at the problem from that direction, there are degrees of priority in the necessity for helping industrial undertakings. But they are only degrees. All industrial activities carried out here are of assistance to our balance of payments problem and all that flows from it. I am glad to note that we are now going to make allowances for industrial buildings. I would wish that the same thing might be done generally in relation to machinery. Machinery is vitally necessary to industry. Many industries rise or fall according to the amount of money they can put into up-to-date and modern machinery. I hope that we will soon be in a position to give all industries benefit from that point of view. Remember, the industry which is to-day working for the home trade may in the future make itself sufficiently efficient and sufficiently up-to-date to be in a position to enter into the export market. The export market is, of course, a jungle where business only goes to the strongest and most efficient.

Successive Governments have been anxious to increase the industrial activity of this country. Looking back over a period of 30 years I think every fair-minded person will admit that this country has been slowly moving forward in the direction of developing its industrial efficiency. The first Irish Government worked in that direction. The second Irish Government continued that policy. Indeed, industrial development has now become the accepted policy of the Irish State. During the war years, we all saw the inestimable benefit that industrial development was to our citizens. Without those industries, small as some of them were, the position of our citizens here would have been a great deal worse. They would have lacked many things. In the view of all thinking people, the case has been made for industrialisation.

While industrial development has been achieved and whilst development is recognised here as vitally essential, it is not always recognised in the same degree in other spheres. There is not a real climate of opinion in favour of industrial activity and all that goes with it. I am speaking now very seriously on this. We have often been told that our people ought to be keener on buying Irish goods.

I believe they are very keen on buying Irish goods and I believe that, when a manufacturer presents goods of the right sort and at the right price, our people are very, very pleased to have that article and will support that product to the utmost of their capacity. At the same time we are not an industrially-minded people. In fact we are not even a very commercially-minded people. We have failed to realise that industry really works on its profits and that the profits that a firm may make are in direct ratio to its turnover. With skill and ability and, more particularly, the ploughing back of profits into a firm, in a very short space of time, notwithstanding perhaps the small amount of capital that that firm has, it may be in a position to make large profits and sometimes people have taken the view that large profits are something that should in fact never be made. That is an outlook that we will have to grow out of. It is quite a common attitude in countries which are developing an industrial side to their economy. I say all that, subject to the overriding fact, that in those profits there is no exploitation. That is why I mention that there is a ratio between turnover and profits.

We should follow a policy of encouraging industries wherever possible to increase their efficiency by putting in new plant and machinery and erecting new buildings. In a large measure efficiency in business or industry now depends on the office staff and the office management. A whole new technique has grown up in connection with that. Many of these office aids, as they are sometimes called, which industry now uses are just as indispensable to the efficient running of an organisation as is the machinery which actually produces the goods. They are part and parcel of the efficiency of industry and are vitally necessary in modern industry. I would like to see them being exempted from taxation just as buildings are, and as I hope will be done with actual machinery used in the process of manufacture.

I am glad to have had the opportunity of saying a few words on this Bill. I welcome it very much and I hope that in the future we shall see many more changes in relation to taxation and industry generally, because we must realise that we cannot just get increased efficiency in production and increased exports from industry generally unless we take the steps to see that those improvements can be made. We cannot expect to have modern industries housed in modern buildings with the most efficient machinery obtainable, if we have an income-tax code, and a corporation tax code designed to take the last penny from those industries.

Mr. Corry

I realise that there is a certain financial difficulty facing the Government but throwing a certain relief to some people must throw an extra burden on others. I would like to see in what way this measure will affect our largest industry, agriculture.

The Government had two courses open to them in regard to this £35,000,000. The first was to export goods to cover it and the second to produce the goods at home which are at present being imported. I hold the Government made a mistake there by penalising the people who were producing at home the goods that now have to be bought abroad. These people mainly constitute the agricultural community.

I am chiefly concerned with Part III of this Bill in relation to exports. When we first got into difficulties it was in connection with certain moneys borrowed which we were told were borrowed for capital expenditure. One instance of that capital expenditure was given by the Minister for Agriculture on one occasion when he told us that he spent £165,000 borrowed on a 30-year loan, on day-old chicks. I want to know now if, that chicken having been manufactured into a hen since 1948—I do not know her age—we are now entitled to relief on the export of that hen? Or are we entitled to export relief on the eggs produced by the hen to help us to pay the interest on the money borrowed to buy the chicken? The money was borrowed to buy the chicken and we shall be paying interest on that day-old chicken for the next 20 years or so. I do not know what age the old hen will be then.

Section 10, Part III, of the Bill mentions "goods manufactured within the State by the person who exports them" and I hold that we farmers, having manufactured the chicken into a hen, should be entitled to export the hen and get relief on that export. The same applies to cattle. If I hold a heifer calf for three years and then export the animal as an in-calf heifer, am I entitled, having manufactured the calf into an in-calf heifer, to relief on export under this Bill?

These are the things that concern us, especially when we see that some lads who come in from Canada or New Zealand or somewhere else to dig out minerals are getting relief from taxation. Anybody who comes in here as a manufacturer and starts to export goods can get relief, but will there be any relief for the men who are all the time paying the piper?

I am also concerned with another portion of this measure. I am concerned with existing firms. Will a firm exporting stout and beer or spirits from this country be entitled now to relief in taxation under Section 10? That is a question I would like the Minister to deal with at the start if he would not mind.

Mr. Sweetman

Does the Deputy mean "now"?

Mr. Corry

I am asking the question, is such a firm entitled to relief now under Section 10?

Mr. Sweetman

Beer and spirits come within the terms of that section.

Mr. Corry

Very well. I am keenly concerned in that because when we were making our bargain with Arthur Guinness a few months ago he told us that practically 50 per cent. of his stout was now exported and that he had to export it in competition with some firms in Britain and they were getting reliefs. The difficulty comes in there: in order to get the raw materials for his export we have to produce for Arthur Guinness a stuff called malting barley. I would like to know what relief the Minister intends giving to those who have to produce that malting barley in competition with the man producing it in Britain who has his artificial manures at £6 per ton less than ours and who has other reliefs as well. For example, the man in Britain does not care what he gets for his malting barley; the Government subsidises his price.

Back in 1948 Arthur Guinness admitted that the English farmer had an advantage of a half-crown a barrel over the Irish farmer. He not alone admitted that, but he gave the Irish farmer a half-crown a barrel more for his malting barley than the English farmer got. Arthur Guinness said that that clause in his contract cost him £2,500,000. Of course times have changed and, under this Government, with the cutting down of grain prices farmers have to suffer many disadvantages. However, when the farmers are making their bargain with Arthur Guinness this year they are entitled to know how they stand. I am entitled to be told now by the Minister exactly what benefit Arthur Guinness will get under Section 10 of this Act. The other farmers and I will be with Arthur Guinness in a fortnight's time making our bargain and we will want to know then how we stand. We are anxious to see that Arthur Guinness will not alone maintain his present export trade but that he will double it provided he does not attempt to pay us a price below the economic cost of production for our malting barley.

As I have said, we are at a disadvantage compared with the British farmer whose artificial manures are subsidised by £6 a ton. The British farmer is subsidised in other ways because no matter what price he gets for his malting barley the Government pays him the difference between the price he gets and a definite sum fixed by the Government as a fair price for it. Because of the disadvantages we are suffering I would put far more faith in extending an Irish industry that is at present on its feet than in efforts to bring new industries into the country. Therefore, I would ask the Minister how we stand in this regard. Looking over figures, I find that in the first nine months of this year Arthur Guinness exported practically £4,500,000 worth of beer to Britain. If he could double that figure it would be £4,000,000 off the sum for which the Minister for Finance has put us in the hole. It might enable us to pay for the foreign wheat we import instead of getting it on tick.

Mr. Sweetman

I advise the Deputy to ask the Deputy in front of him whether that would be the case or not.

Mr. Corry

I am trying to put the case for the agricultural community.

Mr. Sweetman

I would advise the Deputy to get his facts straight.

Acting-Chairman

I would remind the Minister that this is a Second Heading debate.

Mr. Sweetman

I am only too well aware of it.

Mr. Corry

The Minister will be well aware of it before I finish. Will the Minister try and conduct himself? He will be there only for another month or two and he should try to be a good boy.

Mr. Sweetman

The Deputy will be there for a long time.

Mr. Corry

We will be over there for the next 20 years.

Acting-Chairman

It might be advisable to get back to the Bill.

Mr. Sweetman

We were not on the Bill.

Mr. Corry

I am concerned about the provisions of this Bill because they might enable farmers to increase production. The Minister should endeavour to make it possible for the farmers of this country to produce barley as advantageously as it is produced in Britain. I should like also to know what is the position of chocolate crumb in regard to the terms of this Bill. God knows the Minister might induce his pal, the Minister for Agriculture, to let us know the cost of producing milk. They are five years at it now. I am more concerned with the Bill as it affects the agricultural community than with some joker coming in here to start an industry. I am mainly concerned with the man who is here already.

What effect will Part III of this Bill have on the Irish Sugar Company and on the manufacturers of chocolate crumb? If these come under the provisions of the Bill what will be the financial benefit to them? Seeing that the production of beet in this country has gone down by 18,000 acres since we got the benevolent eye of the present Minister for Agriculture on it, and since that situation affects practically the whole economy of the nation to-day inasmuch as we have to find £2,000,000 which has been lost by C.I.E. due to the shortage of freight of 250,000 tons of beet, and seeing that we have to pay the foreigner £3,000,000 for imported sugar to make up for the loss in beet sugar, I am keenly interested in this matter. I am particularly interested in it since the only sugar that can be used in chocolate crumb to-day is beet sugar. I take it that is the only reason for growing beet at all. I move the adjournment of the debate.

Debate adjourned.