Committee on Finance. - Resolution No. 5—General (Resumed). – Dáil Éireann (16th Dáil) – Tuesday, 21 May 1957

Committee on Finance. - Resolution No. 5—General (Resumed).

Debate resumed on the following motion:—

That it is expedient to amend the law relating to customs and inland revenue (including excise) and to make further provision in connection with finance.—(Minister for Finance.)

Mr. Manley

When I moved to report progress here on Thursday evening, I was endeavouring to make the case that a withdrawal of subsidies should be through a series of gradual minor reductions over as long a period as possible, to avoid too serious an impact on the incomes of the people and further to avoid endangering our stability in this country.

It would look clear that the Minister availed himself of the opportunity to get most of the revenue from one source. I am doubtful if he could justify his case on that, when he has not looked further afield and sought avenues or sources of revenue in these difficult times. He could have sought other avenues—such as cosmetics, pictures and amusements of all kinds. Everyone realises that we are spending far too much on all sorts of pleasure and amusement. In the national interest and in the interest of those people who so spend, I think it would be wise to put some check on that trend.

Very derisive comments were made here about Prize Bonds and I should like the Minister, in his reply to this debate, to say whether he intends to continue the Prize Bonds Scheme. Considering that it has been such a relief to the Exchequer, it would be disastrous if the statements such as we heard here last Wednesday evening were to jeopardise the prospects of the new Prize Bonds Scheme. The Minister for Education, when speaking here, said that the Prize Bonds Scheme had shown a distinct improvement since there was a change of Government. Personally, I do not believe the change of Government had anything whatever to do with the added interest in the Prize Bonds. I believe that the attraction was that the money invested in the bonds could be redeemed at par at any time, that it was a novel venture in this country and that it had the element of gambling about it. These were the factors which contributed to its success. At all events, the former Minister must be complimented on his initiative in putting the Prize Bonds Scheme into operation, considering the advantage it will be to the present Minister for Finance and to future Ministers.

The £250,000 made available to provide further markets for our increased exports is a thing we all welcome. It is not easy to find such markets and it would be well if the Minister would, in his reply, give us some idea of the efforts which will be made to secure those markets abroad. It is vital that we go after them at once. I was speaking recently to a gentleman who spent a month in England last year— an Irishman, of course—and to my surprise he told me he was not able to get Irish beef in several towns he had visited in Great Britain. It would look as if we have failed in our distribution methods. We should go after those markets and push our wares into every conceivable part of Great Britain. That is a major problem requiring the best expert advice and the most vigorous efforts.

The same thing applies to eggs in Great Britain. I was talking recently to a lady doctor who spent four years in practice in Great Britain and never used an Irish egg, simply because those she had seen cooked were unusable because of their staleness. I do not know what the remedy is, but I believe our co-operative societies should arrange a weekly collection of eggs so that they would be dispatched at the point of export in the freshest possible form.

I welcome the assurance from the Minister about the economies he intends to effect. He has mentioned the Irish News Agency. I am at one with him in that. I believe it is too costly for us to maintain it at its present standard. I believe we can get all the publicity we need through An Bord Fáilte and, now that we have been admitted as a member to the United Nations, that gives us a forum for explaining the position of our country here and for advocating the integration of our territory.

I should like to go further afield and see whether the School for Advanced Studies would afford us any great scope for economy. Its existence is almost paradoxical, when we have our own National University, which should be in charge of all forms of higher education. The School for Advanced Studies should be incorporated in the National University, where there is greater scope for research and for advanced studies of all kinds.

The Army is another Department of State which calls for a drastic reduction. Armies as at present constituted are about to become obsolete and eventually they will be replaced by armies of technicians. Here we have to maintain the Army at its present strength, or at least at its present cost, and I do not see how our circumstances can afford that.

This House itself calls for greater economy. It is an extraordinary thing that here in this little island, with 2,750,000 people in this part of the country, we have 207 people legislating for us. It seems to be out of relation to our economic standards here to maintain an institution up to that number. We have a Seanad of 60 members which has very little function, if any at all. Because of its restricted function, I hope this Minister will think it wise not to maintain that Second House in its present form, without giving it some more useful functions, at all events.

We have almost 30 Deputies representing Dublin City. In this impoverished island, is there any realism in that state of affairs? Any Dublin Deputy, if he lives in his constituency can go to any part of his constituency by a fourpenny bus trip at any time and it looks altogether unrealistic to try to maintain that set-up at the present time.

The Minister has mentioned the Civil Service, to which he is going to apply the axe and stop recruitment right away. Ironically enough, I saw in one of the daily papers last week that the Civil Service Commissioners were seeking extra staff. I want to be clear in my references to the Civil Service and say at once that it is a magnificent service, 100 per cent. dependable and 100 per cent. incorruptible. It is the greatest buffer we have here in protecting and guaranteeing the security of the State. However, it is costly in its administration—there is no question about that. When a Civil Service costs £17,000,000 in this small island, there must be room somewhere for reduction. Personally, if I may venture an opinion, I think the service is over-sectionalised, each section dealing with a particular phase of its respective Department. These sections should be co-ordinated, thereby cutting out the possibilities for redundancies in promotions and in staff. That can only be done effectively through the goodwill of the service itself and by beginning at the bottom, that is, at the recruitment stage.

It is a rather staggering fact that we have to face a bill of £160,000,000 this year in making provision for this State.

In the past, volumes were written about the iniquity of Great Britain in imposing £2,000,000 a year taxation on this country through the Act of Union, but when we compare that £2,000,000 with the £160,000,000 we are now asked to provide for the various services and the maintenance of public works, it gives food for reflection.

I remember speaking recently to a gentleman in Cork who was a great friend of the late General Michael Collins. Michael Collins said to him away back in 1922 that in getting control of our affairs we would be very lucky to have fiscal control here, that as far as he could see the Irish people would not have to be asked for a shilling towards the maintenance of the State. If Michael Collins were alive to-day, or if some of our other dead patriots were alive, how disillusioned they would be at the existing situation. There must be many in this House who are disillusioned at the trend of events with this seemingly uncontrollable expenditure mounting up year after year.

It would be interesting if we had a graph representation of our expenditure and revenue side by side. There we would see that, year after year, revenue is chasing after expenditure. When will there be an effective check on that trend? We are exhorted here from time to time to have faith. The Irish people are told they should have confidence in public administration. It is a credit to the Irish people that they have had confidence over the past 35 years, but that confidence has come to breaking point when efforts to bring the administration of this State more into relation with our expenditure have been unsuccessful. High taxation to-day seems to me to be the cumulative result of misspending over the years. We follow slavishly the patterns in other countries, and Irish genius and initiative, which have been asserted many times in the history of this country, have never asserted themselves to the maximum in the Parliament of the nation.

A good deal of talk has been made about the great gap this year between revenue and expenditure, but that gap is not so formidable when we realise that almost every local authority depends for a great part of the year on borrowing from the banks. I do not say it is a wise thing; in fact it is a tendency that should be checked. Whether they take their pattern from this House, I do not know, but this over-spending has left us without the capital for productive works.

Deputy Murphy mentioned a very important matter last week. He said that for men in rural areas the average rate of unemployment assistance would be about £3 a week. He advocated—I think a very wise and constructive point on his part—that instead of giving these men £3 a week for being idle, work should be provided for them and that, as well as receiving their unemployment money, they should get an additional payment out of some local fund to bring their standard wage up to £5 a week. In that way we would be making some progress and creating activity in certain parts of the country. There are local men prepared to come together and put up a sum, provided the State does its part in putting up at least a similar sum in order to carry out some utility works. Take, for instance, all the derelict sites we see, and very objectionable they are. We are anxious to invite tourists here and, travelling up and down the country, they must be horrified at what they see. These derelict sites could be cleared and some sort of attractive wall built around them, if there were more elasticity between the Department providing this unemployment money and some of the local people with initiative.

The Taoiseach last week spoke about unity in the House. I believe there is a unity of purpose here, that purpose being the full development of our resources, the provision of full employment for our people and the checking of emigration. These are the problems about which we are worried at the moment. We could have greater unity if we had less of a political slant in our debates and if we were more objective in our contributions. This House should be a source of inspiration to our people and it would be disastrous for this country in the House were to fall into disrepute outside. We should all be zealous about maintaining the dignity of the House and more appreciative of our responsibilities.

Above all we should make every effort to produce greater results in the Assembly of the nation. This Assembly should give the greatest inspiration to our people. They are at the point of losing confidence after 35 years of exploitation. They cannot endure such hardship for ever, and we must make some drastic changes in our public administration.

General Mulcahy

The country knows now to a fair extent what the effect of this Budget is on the domestic user. It is beginning to have an appreciation of the disturbing effect it may have at the employer and employee level. However, it is on production and marketing, which is concerned more with the future, that the greatest stress has been laid in this discussion by those who want to pass over the immediate shock of the Budget. The country is left in a very great state of obscurity as to the effect of the Budget on employment in the future. There is complete darkness on the horizon of the future.

A number of speakers here, including the Minister for Industry and Commerce and the Minister for Lands, have painted in a rather broad way the future which we are facing. The practical people who are concerned with the interests and the well-being of the people, who know that the blow has fallen on them in the form of additional taxation and the removal of food subsidies through this Budget, would all like to concentrate on those aspects of the situation. For that reason we ought, in as detached a way as possible, to look at the circumstances in which we are told from the Government Benches that a new national era has begun.

The Minister for Lands tells us that we are in a new national era now; the Minister for Industry and Commerce has indicated to us the position which the manufacturing industries are going to occupy in that situation. The Minister for Finance tells us they mean to increase our general economic level through agriculture and the Minister for Industry and Commerce tells us the main hope of employment is in increased manufacturing industry and organisation. The Minister for Lands tells us of the increased and elaborate improvements and developments that have to take place in our manufacturing industries, if we are to have any hope of maintaining the present standard of employment and the present living standards of our people, or to make any attempt to increase production in the country generally.

The circumstances in which we are approaching the future have had a certain light thrown upon them by some of the reports that have been made recently. These reports have thrown a certain amount of critical light on the economic facts of the situation. The Capital Investment Committee has reported, having been set up to go into the position with regard to capital investment, the capital which might be expected to be available and the volume and nature of the investments that could be undertaken, or that must be undertaken, if we are to improve our production and increase our employment.

In that report dealing with the capital Budget for the current year, they have pointed to certain moneys that are being spent, and that have been spent for some years past, subsidies, on the one hand, and assistance to agricultural development, on the other, and they have indicated that a better use could be made of these moneys. They indicated that these moneys should not be used for current revenue. Among the recommendations they have made for consideration is a recommendation that, if a change is to be made in their use, that change should be made for capital purposes.

It is reasonable that the Minister for Finance and the Government should say that they have not had time to examine the recommendations with regard to action at the present time, but the recommendations with regard to the use of moneys here, and the use of capital here, and the purposes for which these moneys are put, are fairly clear—that, as they are used at the present moment, the committee did not consider they were effectively applied towards securing an increase in production and, at the same time, an increase in employment in the country.

However, in relation to any recommendations for the alternative use of these moneys for capital purposes, without any examination, the Government, as I say, have put their foot down on the full scheme of proposals in that report by applying the subsidies on butter and on bread to current revenue. The facts of the situation have shown that capital is enough to keep going the necessary amount of capital development that ought to be carried out by the Government on one hand, and yet leave enough on the private side to secure increased development and production there. That is one of the facts in the present situation that we have to take cognisance of.

At the same time, there has recently been published a report on the transport situation in the country. In 1944, the present C.I.E. company was set up in circumstances in which this House defeated the proposal to set it up. We had a general election and a Fianna Fáil Government was returned and it established C.I.E. After 12 or 13 years of operation, we are told by this report that not only has a sum of £11,000,000 of its capital investment to be written off, but that the services provided to the country by the railway line, a system of 1,918 miles, has to be reduced by more than half, that the services provided by 194 stations have to be reduced to the extent of five-sixths and that there are a substantial number of workers on the rail system who have to be made redundant, together with reorganisation that must necessarily take place, either under public organisation or by private organisation, of the road transport services in the country. That is another important aspect of the present situation in which we are supposed and expected to carry on.

Another factor in the situation is the proposed setting up of a European Free Trade Area and the resultant impact upon the economy of this country, whether we join that area or not. It has been particularly stressed, in the future being painted in relation to this Budget, that we have to have a substantial development in agriculture and a substantial increase in agricultural exports; that we have to have a substantial development on our industrial side and a substantial increase in our industrial exports. So important is that considered by the Minister for Industry and Commerce that, when he spoke on the matter, while saying he had not thought of applying sanctions to industrialists in this country in relation to increasing their capacity for export, he nevertheless implied, in view of the fact that he mentioned sanctions, and then put them aside, that he had certain types of sanctions in mind. He said that if there was not a development of industrial activity on the scale he wanted and in the manner in which he wanted it applied, he was going to apply very effective and very serious sanctions on industries. The circumstances in which people produce in this country are circumstances that are surrounded by all the factors which that implies.

When the inter-Party Government first came into power, one of the first things we did was to establish the Central Statistics Office and to detach it from any other Department of State, so that every aspect and every detail of our economic life would be available in terms of statistics and information, so that any policy pursued here would be based on well-known facts and every section of our people, and every section considering the matter at Parliamentary level, fully informed of every aspect of our economic life and that policies would be policies openly adopted in the light of these facts. Here we have a picture painted in regard to increased agricultural development and increased industrial development, but the position is that unless there is that increased development, the present unemployment must not only continue but must increase and that emigration which is so much talked about must continue.

While, therefore, appreciating the circumstances and appreciating the implications of not dealing in a satisfactory way with financial and economic matters, we assert that the action of the Government has been to take a blind swipe at a rather fundamental point in our financial stability; in other words, they have abolished food subsidies which were originally introduced for the purpose of assisting and stabilising wages, but were, at the same time, of vital importance in our production policy. Food subsidies have been wiped out now and everybody knows what the increase in butter, bread and flour will be; but those who are vitally concerned here, the producers on the agricultural side, have no idea in the world as to how the withdrawal of the subsidy on butter, for instance, will affect milk production and the creamery industry generally.

On the flour and bread side of things, many people do not yet know what the result will be. When flour was protected in such a way as to make it a national monopoly, though not in Government hands, one of the things the Government of the day insisted upon was that the small millers should be protected. The protection that was given them, in order to assist the industry in general and the small millers in particular, was such as to put exorbitant profits into the hands of flour millers of whatever kind, so much so that about 1935 the Government of the day caused an inquiry to be made into flour prices.

To the best of my recollection, that inquiry reported that over and above a normal profit—that is, a profit to the millers that the Government would consider reasonable—there was a profit of about £34,000 taken exclusively by the millers in the course of their business. A recommendation was made that, as the small mills at that time were suffering losses or were receiving less than would be considered a normal profit, the larger mills would surrender, by way of levy of one kind or another, part of the profits they were making and that money would be used for the purpose of assisting the smaller mills.

The Government, I think, threw up its hands in horror at the idea of making any kind of rectification of the situation along those lines and, what ever scheme was subsequently adopted by the Government, the fact remains that on the flour milling side a situation has developed in which the larger mills have aggrandised themselves into very big concerns indeed. That has had a certain effect upon the bakeries and complaint is made from time to time that the smaller bakeries are being absorbed by the larger bakeries, or by the larger miller-cum-bakery, and even such smaller bakeries as are left are being gradually wiped out by the larger concerns.

I do not know to what extent the smaller mills have been injured. I do not know how employment stands at the small mill end of the flour milling industry. I do not know whether all the small mills have been absorbed, but I submit that the process that is taking place is an injurious one from the point of view of the smaller bakeries and it may have been injurious, too, to the smaller mills which have been absorbed in a painless kind of fashion. I submit that, in the withdrawal of the flour subsidy, the Government has struck a blow at the production and industrial side in so far as there is there an element of competition to keep down prices, on the one hand, and employment scattered in a reasonable way throughout the country, on the other hand.

It is in these circumstances that the people are asked to make sacrifices for a policy that is guaranteed, in so far as declarations by the Government or its supporters can ensure, to bring about increased agricultural development, increased industrial development, greater production all round and increased exports. The people are asked to make sacrifices, on the one hand, for that; on the other hand, they are asked to cut losses just as the country is asked to cut the £11,000,000 losses incurred in the rail transport system as a result of a scheme introduced against the protests of the majority in this House in 1944.

The creameries do not yet know what losses they will be asked to cut. The point that I make is that this blow has been struck in such a way that nobody can understand the effect on our production. Remembering the general difficulties of the situation, those who have their capital invested in productive concerns here are being asked to do, in an urgent way, something which may very well prove impossible. In other words, they are being asked to reorganise industry in such a way as will meet the increasing pressures brought about by, let us say, economic circumstances alone; they are being asked to increase exports, both agricultural and industrial, so that the country will not find itself faced by serious unemployment problems; and, above all, they are being asked to prepare for what is likely to arise from the situation in Europe. Remember, a free market is likely to be set up there and it is more than likely that we shall find ourselves involved in it.

The Minister for Lands shuts his mind to anything beyond the last ten years. I do not query the reasonableness of that for the purpose of setting our compass for the future. However, he asks us to consider what a magnificent thing it would be if the Dáil would interest itself in time and motion factors. If there is any place in which a sense of time and motion factors was wanted, it was in the Cabinet Chamber when the Cabinet were discussing what they would do with regard to food subsidies. We all appreciate what time and motion factors can do. They are vital in dealing with the general economic situation. They are vital in the ordinary lives of our people, trying to organise their domestic lives and their daily working lives.

The Government has sinned in a critical way in dealing with these food subsidies. It has sinned in abolishing them, all in one slap, on the one hand, and, again, by abolishing them in current circumstances in the face of the implications of the Report of the Capital Investment Committee. The Minister for Lands asks us to look back over those years. If we are to set our compass straight for the future we have to glance a little further back, not for the purpose of saying who did this, that or the other thing, but for the purpose of discovering what is militating against our people doing their job in an efficient and fully organised way.

Those of us who can look back over developments in this country before the first war realise that this country had to suffer trampling on both its economy and liberty. We had the political struggle after that with Britain. We had our own internal troubles and we were still left with internal and external political difficulties by reason of the division of the country. That affects us economically as well as politically and we have to eliminate in so far as we can dissension, irritation and the blame in relation to any of our present circumstances if we are to give our people a chance of dealing with our present problems.

The Government in presenting this Budget asked the people for sacrifices. They have to cut their losses. They have done more than that. They have washed their hands in regard to certain aspects of our past economy which they led the people to believe was part of Government responsibility. The Minister for Industry and Commerce, when speaking here on the 14th May last in relation to food subsidies, at column 1158 of the Official Debates, said they were put on to meet a very temporary situation:—

"...a temporary upsurge in prices which would be reversed very quickly. We were guided by the world experience after the first Great War. We thought that it would have been repeated and it might have been, were it not that the Korean war intervened to alter the process."

We were given to understand and the people generally were given to understand that the difficulties with regard to prices at the time of the Korean war arose out of the mismanagement of affairs by the inter-Party Government. It was by beating that particular type of war drum that the Fianna Fáil Government was returned in 1951 in the same way as on a similar occasion before during the depression of 1930 and 1931. Again, it was alleged, it was a non-Fianna Fáil Government which was responsible for that particular situation. However, prices did not fall and it is accepted by the Minister for Industry and Commerce and no doubt by his colleagues that it was the Korean war which intervened with the process and prevented the recession in prices arising after the last war in the same way as they receded after the first.

The Minister for Industry and Commerce goes on to say:—

"I think it will be a good thing for the country if it becomes more generally realised that alterations in regard to wheat or milk prices will have consequences and they have to be kept in mind when decisions are being made. It was a completely false atmosphere in which these matters were discussed while these subsidies were in existence."

The wheat farmers and the dairy farmers are apparently to be left to their own resources now and beyond whatever the Minister for Industry and Commerce does to mark prices here and there, the farmer is being thrown his own job to do. To some extent the industrialist is being thrown his own job to do also with a slight kind of threat that is reminiscent of the threats made by the present Minister for Local Government when he was Minister for Agriculture.

The Minister says:—

"The time has come when we must think in terms of a new approach to the whole question of industrial expansion...the expansion of employment depends mainly upon the increase in industrial activity."

It was in those circumstances he said: "We have not thought of and I hope there will be no need to think of sanctions in that regard." But they may think of sanctions. The Government have asked the people to make sacrifices. The taxpayers generally who provide capital have to cut their losses in respect of C.I.E. The industrialists, those who are producers, are now being told that they must stand more on their own feet. Happily, during the past ten years, in respect of which the Minister for Lands thinks there has been so much neglect, there has arisen in this country a greater sense of responsibility to accept representatives from among various people in agriculture and in industry.

The setting up of the Agricultural Advisory Committee by the Minister for Agriculture and the various representative bodies which deal with different aspects of industry shows that there has been a growth of representative organisations among those who are functionally representatives of the productive life of the country. It is in these particular circumstances that we look to hope in the country. It has been indicated by the Ministers that the reason this Budget is accepted by some at least of their followers—I am sure it is representative of a number of them—is that they accept these recommendations for the withdrawal of the food subsidies because they believe they represent a move towards full employment.

If we could get all Parties to fix their mind on what they mean by full employment and to watch carefully the things proposed, the things that are possible for strengthening our agriculture and our industries and make it possible for greater production to take place without a former Minister for Agriculture wanting to say in the House that another Minister for Agriculture, now on the opposite side, was no good and avoid the exchange of pure personalities, of a non-constructive and frictional kind, we might be able to use our thought and resources to stimulate the people who labour under difficulties in the country, particularly those who labour under difficulty in agriculture and industry from the point of view of further development and employment.

We can make no excuse for the Government for sweeping aside the subsidies in such a rough and ready way. They say it is the best way they know of. We say we are sorry they do not know a better way. They insisted that the country would never have a chance of bettering itself in any way until the last Government was got out of office. They got the last Government out of office on the representations they made to the people. They say now that they have taken the best action they can take. Let them not stop, in facing up to their responsibilities to ask: "What would the last Government have done?" They have been told in a certain amount of detail what the last Government would have done—but that is only touching their responsibility and the work they see and that they say is in front of them. They have taken this step. They have the record of the votes on the various Financial Resolutions which shows that the Finance Bill will go through and that the proposed increased prices on butter, flour and bread will become a reality to the consuming public. That being so, let them go and take the next step. But, facing people who have to co-operate with the Government in taking the next step, at every step is the gambler's thimble over the vital spots—the vital spot of the creamery industry, the vital spot of the bakery industry, the vital spot of the milling industry, particularly the small mills. It is over the question of wheat production and the wheat subsidy.

We were told here the other night that not only too much milk but also too much wheat is being produced. We have even been told that some of the wheat which Deputy Dillon, with his experience and his knowledge, insists is quite fit for use in flour for bread making is "bad" wheat. We were told that some of the wheat saved last year which is available for flour making is "bad" and that we shall have to throw £150,000 after that so-called "bad" wheat, according to the Government. Therefore, even in respect of wheat-growing, the thimble rigger's thimble is over the situation as well as being over many other things. In the interim period, we do not know how much has to be paid at, I suppose, a rate of about £10 a cwt. in that particular way for the export of butter.

The country is bewildered by the action of the Government in removing the subsidies despite all they themselves said in regard to that matter and in the light of existing facts. Those who are most important in the country from the point of view of doing what the Government considers necessary to increase production, the farmers and the industrialists, are bewildered about what is in front of them arising out of the action taken by the Government in this Budget and arising out of implications of the speeches from the Government Benches on this General Resolution. These, together with facts that are more and more disclosing themselves in the various authoritative experts' reports in regard to aspects of our economy, are the things that require our attention, very clear delineation and careful thought.

I plead with every person concerned with any aspect of affairs in the country to realise that it is not sufficient for the Taoiseach to say that this is a very critical situation. It is not sufficient for the Minister for Lands to say that we are approaching a new era. It is not sufficient for either the Minister for Lands or for the Minister for Industry and Commerce to say that we have to deal with industry in the light of facts that were unpredictable or unforeseeable when we began to protect our industries. It is not sufficient to say these things and not to show urgently what the Government think the people can do and what it can do to help the people to meet the position. To do otherwise will only prolong the people's uncertainty and throw those who could help as organisers of or investors in new development into a spirit of despondency or inertia. Before doing anything radical about increasing industry here they will wait until they are sure of what the Government is going to do besides telling them that the ball is back to them now, that the Government cannot do as much for them and should never have done as much for them as was done in the past and that it is their job to seek out how best to organise themselves and their production and to export.

The Government will have to wake up and show at the earliest possible moment the lines upon which they are thinking. They will have to give a clear indication of their intended line of action in relation to which the people can go ahead with their own work.

Dr. Esmonde

A noticeable feature about the debate this week is that there are no interventions from the Government side of the House. By "no interventions" I mean that there are no speeches from that side of the House. Government Deputies have probably had very much the same experience as Deputies on this side of the House, namely, that on the introduction of the Budget the people generally were not aware of the implications. It is now dawning on the people of Ireland that they had inflicted on them one of the cruellest and hardest Budgets in our history. I am not a doctrinaire believer in subsidies as a sound economy. However, the subsidies in question were introduced by a Fianna Fáil Government at a certain period for the purpose of sheltering people against the hardships of a rising cost of living and the difficulties the world as a whole was facing after the last world war.

There does not appear to be any indication that the present moment is the time, at one fell swoop, to remove all those subsidies and totally upset and disorganise our economy. In effect, that is what the present administration has done. No doubt they have been advised by economic experts and their financial advisers that that was the correct thing to do. I accept that financial advisers are there for the purpose of giving what they consider to be sound advice. That has been so in the economic history of different countries down through the ages. However, it is not incumbent on a democratic Government to accept that advice in toto. I submit to the House that, in accepting that advice and removing in toto the subsidies, it was not good policy and it was not motivated really by any collective school of thought that could hope to produce a good effect on our economy as a whole. Our stability is destroyed overnight.

This debate has gone on for a fairly long time now and I do not want to cover any ground that has already been covered. I just want to deal with one or two facts. We are told that this extraordinary Fianna Fáil Budget was introduced for the purpose of getting greater production. I should like to say something about the butter subsidy. We introduced the butter subsidy, and the fact that we introduced it means, of course, that the Fianna Fáil Party would like to take it away. They did not hesitate to take it away. I believe, if the truth had been known, that Fianna Fáil back benchers thought, when the Minister stood up to make his Budget statement, that the butter subsidy was the only subsidy that would go. It was doomed from the word "go" because we had introduced it.

I shall endeavour to show the House why I believe that subsidy served many purposes, and why I believe its removal will greatly disorganise our agricultural production. In the first instance, it is crystal clear that a subsidy such as that made it possible for old people such as old age pensioners to buy butter. It made it possible for the mothers of bigger families to give their offspring nutritious butter to eat, and in that way it was helpful to the health of the nation as a whole.

I came into this House in 1951, and from 1951 to 1954, I was conscious in a constituency such as mine—Wexford— of the marketing difficulties which farmers encountered in trying to dispose of their surplus butter. I had nothing but complaints from 1951 to 1954 about the inability of farmers to sell their butter, but I had not one complaint from 1954 to 1957 because of our increased consumer potential for butter, and as a result, the price was also considerably increased and we had no surplus on hand. Apart from the fact that our people were eating butter, the butter subsidy obviated the necessity for the importation of margarine and it also acted as an agricultural stimulant in that it represented an inducement to increased production. It encouraged farmers to breed more live-stock because they realised that, if they had more cows in calf, they could dispose of the milk to advantage by having it converted into butter, with no risk of being thrown back, as they were before, on to chocolate crumb, dried milk or cheese when markets were becoming more difficult.

That is one indication of the instability that may be caused by the removal of the butter subsidy, caused not alone in the agricultural industry. Deputy M. P. Murphy, a Labour Deputy from Cork, very ably detailed, the other evening, the position with regard to the financial aspects of the removal of the butter subsidy. The Government will gain £2,000,000 by it, but he proved here— and I think his arguments were very sound—that it will cost £1,000,000 to subsidise the sales of butter abroad, allowing that 12,000,000 lb. would have to be sold outside the country, and this will probably be necessary.

One of the greatest difficulties encountered by the last Government was to sustain and equate the price of milk. Have we any guarantee that the Fianna Fáil Government, by removing the butter subsidy and thus creating the situation that I have outlined, can maintain that price? If they do maintain it, they may have to do it by subsidy and what will that subsidy come to, once they have to get down to giving a subsidy for the price of milk at all? We listened to criticism from the other side of the House when the Fianna Fáil Party was in Opposition about the price of milk; they can now face the situation which they themselves, by their own stupidity, have created.

That is only one subsidy. Everyone in the lower income group, everyone on a salary—and that is the major portion of the people of this country— is dependent on bread and butter for existence. The Fianna Fáil Party know that now; they did not know it the first week of the Budget, but they know it now, because when they went back to their constituencies last week they heard of the sufferings they were imposing on the people. They also began to hear from the people what the people think of them, and that is the reason for the silence on the Fianna Fáil side to-day. Last week they were prepared to get up and make speeches to the effect that they were more or less conferring a benefit on the people of the country by stabilising their economy.

They took over this country in balance except for a small sum that was out of balance due to the unnatural situation which arose last year on account of the Suez Canal crux. That involved a certain loss of revenue, and there was also the untoward drop in agricultural prices. However, Fianna Fáil took over the country with every possibility of buoyancy and could have taken a risk to that effect but they did not do that. A leopard does not change his spots and what they did in 1952 they have done again now. Whenever they get a chance they will do it again, because their idea of economy is to get all they can out of the Irish people and make the money available to increase agricultural and industrial production.

What schemes have they got for increasing production? I read the Budget speech, and—I may be very stupid—the only thing I could see in it is that they are to spend £250,000 for marketing. I approve of that, and I am sure every Deputy in the House approves of it, but no matter how they spend that money for the purpose of marketing, the only Minister who has spoken so far on the matter was the Tánaiste, who says that they are to go into consultation with the agricultural associations to consider how to spend that money. I wonder if it will cost £250,000 to have a consultation with the agricultural associations? If so, it will be a very expensive consultation.

I should like to make some suggestions with regard to marketing. We went through a very difficult time last year because cattle prices were falling all through the winter and it was a very severe shock to our economy. That was largely due to the fact that we have nearly all our eggs in one basket. Britain, one of the greatest food importing countries in Europe, decided for some reason or other—perhaps to bring down her own cost of living—to import a great deal of beef from South America. That, in itself, was understandable but I think we buy more per capita, perhaps, from Britain than any other country, and they might have given us more consideration. Not only were they buying beef abroad but they were exporting into the very markets we ourselves had secured. That was the situation we had to face last year. I think it is a situation which should not be allowed to arise again.

We did not sit back and do nothing about it. Members of our Government went out and negotiated and found a market for our agricultural produce for a certain limited period. The French Government was persuaded to take off the 25 per cent. tariff on the import of live-stock and when the French people got a taste of the Irish beef—and it was the first time that Irish beef found its way into the continental market— they liked it so much that they took the tariff off a second time and we were still able to export it to France. Then the British Government, seeing the opportunity, bought cattle from us in limited quantities and exported them wholesale to France. They then bought more beef from South America and we were unable to balance this off because we were unable to send direct there ourselves—we had no ships to do so.

We have at the present moment under examination a treaty which will be made effective in a very short time between certain European countries including Luxembourg, Holland, Belgium, France and Italy, and the Federal Republic of Germany, representing 160,000,000 people, who propose to constitute a common market. The purchasing power of that group is enormous. The potentials there are enormous. Although they have agreed to a free trade among themselves, there is no reason why they cannot make separate and collateral agreements with other countries. That seems to me to be our opportunity.

I observe from to-day's paper that we are negotiating with regard to the common market. The paper does not say who is negotiating for us. It is very probable that some civil servant is doing so. I do not want to say anything derogatory of civil servants, but I know enough about Europe to know that you can negotiate through civil servants in the United States of America and in Britain, but, if you want to get proper and fruitful negotiations on the Continent of Europe, it is advisable to negotiate at political level.

I should like to offer this advice to the Government, that they should go in at political level as early as possible to try to get a market which is so fruitful, in which there are such potentialities at the moment. If they can get in there, all our troubles in regard to exports for the future should be solved. I do not mean to suggest that we should abandon the British market or that we should turn our back on the British market. We should in every way utilise the benefits of that market. We must realise that we are facing a changing situation and that our potential to sell in Britain in future may be largely confined to a store market and, if we wish to sell our finished products, Europe is the place to look for a market. In any case, it would be a good auxiliary to what we already have.

With regard to employment, the only provision I can see in the Budget for employment schemes, relief employment, out of the large sums which are being gathered under the new methods of taxation, is another £250,000, and the members of the Government have been very coy or uninformative as to how they will spend it. An inkling has been given that this money is to be spent in Dublin. Of course, as a countryman, I cannot approve of that, but I suppose there is at the moment considerable hardship in the City of Dublin.

In this debate, the question was discussed as to how that money should be spent and it was suggested that it would be a good thing if it were put into a productive scheme. I suggest to the Government that there is a crying need in the City of Dublin for parking accommodation for motor cars. If the Government propose to spend £250,000 or less in Dublin, let them provide proper parking facilities, be they overhead, over the Liffey, underground or wherever else they may be. If they charge a small sum for parking, that parking place will be full from morning to night. Every countryman knows that if he takes his car to Dublin, there is nowhere to park it. Such a parking place would pay for itself and the Government would get their money back. It would be a productive scheme and it is productive schemes that we want, not only in the City of Dublin but in rural Ireland.

According to the latest statistics compiled by the Secretariat of the Council of Europe relating to all countries, the population of Dublin is 522,000. The total population of the part of Ireland over which we have jurisdiction at the moment is under 3,000,000. Deputies will realise that Dublin has got to the stage where it is no longer economic to expand. I would suggest to the Government that any schemes they may have for industrial expansion should be concentrated in rural Ireland. There are many opportunities, many facilities, in many parts of the country, buildings available for factories, and so forth. It is time that some Government tackled that problem seriously in the interest of the community as a whole.

I observe from the Minister's Budget statement that the question of abolishing the Irish News Agency is being considered. Some Deputies have spoken in favour of that course and some have spoken against it. As a Deputy who has had the privilege of being abroad a good deal in the last few years, I am conscious of the terrific propaganda that exists against this country. We have no means of counteracting that propaganda, unless we utilise other agencies for doing so. The Irish News Agency operated under a difficulty in that it was not in a position to compete for what is known in journalistic circles as "hot" news. It was difficult for them, therefore, to balance their budget and to make the agency a solvent concern, but I can assure the House that that agency is fulfilling a useful function in that it is counteracting subversive propaganda against Ireland and the Irish people.

The tourist potential of a country depends upon its having a pleasing record for all other countries. People are not inclined to visit a country about which they have heard derogatory remarks. There is a lot of that going on against Ireland. I have been personally conscious of that in my contacts abroad in the Council of Europe. Members of Parliament and Deputies of other countries have asked me if such and such a thing is true about Ireland—things that are totally untrue and unfounded. There is a ceaseless flow of propaganda. There will be always propaganda against a small country like Ireland. There will be always propaganda against us from the Communists and anti-Christian outlook which is prevalent in other countries. We can only counteract that by having an agency of our own.

According to the Book of Estimates, the Irish News Agency costs £45,000 a year. That may seem a big sum, but, having regard to the enormous sums the present Administration are collecting by cutting out the subsidies, by imposing extra taxation and so forth, it is a small sum to pay in order that the truth in regard to this country may be maintained and upheld abroad. Why should we lie down under this subversive propaganda? I would ask the Government to reconsider the question of the abolition of the Irish News Agency.

The troubles and difficulties the last Government had to contend with are now evident to the people of Ireland. I sat on the benches behind that Government and I supported them. I did not always agree with everything they did, but what the Fianna Fáil Government have done to the Irish people in the short time they have been in office shows how good a Government the last Government was, in face of all the difficulties and trials that faced them. They created stability. They equalised the cost of living. They increased agricultural production. They got nothing but vilification and abuse from every-where. The people of Ireland believed that abuse. They returned the Fianna Fáil Government to power, probably for four or five years. My guess is as good as anybody's. They will live to rue it.

Mr. Everett

We have heard appeals from Ministers to trade unions and others to make sacrifices and to tighten their belts. The Minister, introducing his Budget, pointed out that, if certain sections of the community through their organisations were able to secure compensation to meet the increased costs the withdrawal of the subsidies had placed upon the workers, the Budget would be a failure from his point of view. The Minister for Defence suggested that certain people were trying to create a disturbance in the country in criticising this Budget because it was introduced by Fianna Fáil. Every Irishman, whether he agreed with him or not, was to make a sacrifice because Fianna Fáil cannot be wrong.

The Taoiseach stated that it was necessary to have an army and he asked those who were criticising the Budget what was their alternative. I am privileged to be a member of a trade union for the past 35 years, and I am still a paid-up member, and I can assure the Government that no leader of any trade union encourages the members to make demands for increases in wages. The duty of the leaders of the trade unions to the rank and file of the members, notwithstanding what any politician may say, is to protect the interests of the workers and to see that their standard of living is not reduced—as it is being reduced by this Budget. No appeal will prevent the rank and file from demanding that which they are entitled to get.

The workers are asked to make a sacrifice, but for whom are they to make that sacrifice? It is the workers all the time, and especially the lowest paid workers, who are asked to make sacrifices. The unfortunate docker who has worked for eight hours in the hold of a ship does not get home to dinner. He takes a few drinks and some bread and butter, but he can see that the taxes and duties have been removed for the people who drive motor cars worth £1,600. It is for such people that he is asked to tighten his belt. The farm labourer is being asked to continue working for £4 10s. a week. In return, he is asked to pay 4/7 a lb. for butter and 1/1½d. for a loaf of bread. The extra 1/– he is to get through children's allowances will go on Monday morning when he buys his bread and butter. Builders' labourers and all organised workers see a certain influential body of business people who are given a concession so that they can buy mink coats and other furcoats.

They are asked to make a sacrifice so that these business people will be enabled to pay for these coats. They are asked to pay more for their sugar and butter and pint of beer.

If I had a choice in relation to the food subsidies I would vote, as I have always voted, to retain them. I would vote against maintaining some of our embassies abroad at the cost of millions of pounds and especially maintaining an embassy in the United States of America where the newly appointed representative to Ireland said that it was in the interests of America to keep Partition in Ireland.

An Leas-Cheann Comhairle

We cannot discuss a statement made in America by the representative to Ireland.

Mr. Everett

I am discussing the Budget. Deputy Briscoe, to give him credit, has given more publicity to this country in America in a short time than have our representatives there who have been silent on the question of Partition. If they have been vocal, they have failed to convince the representative of America in Ireland that it is in the interests of America and Europe to have Partition removed. I would save £1,000,000 there.

I remember when the Civil Service was established in this country and an Irishman was brought over here with experience in England. He was a credit to this country. I have had a long experience of the Civil Service since then and I can say that, with the exception of one or two, the civil servants are a credit to our country. The Minister has tried to tell the people that the Civil Service is too large. We admit it, but who is responsible? It was not the inter-Party Government. I, in my own way, tried to refuse to fill major posts while I was in office. It may be possible to reduce here and there, but there will still be high expenditure or, if there is not, there will be further emigrants going to look for work abroad instead of remaining idle at home.

Why do we need to retain—I am expressing my own views now—at a huge cost, the position of President?

I am not saying anything against the present gentleman who holds the office and who fills the position with honour and credit. Why do we not economise in that direction and save another £1,000,000? Another £2,000,000 is practically given away by removing taxes on motor cars and luxury goods. Another £1,000,000 could be saved on the Army, the mechanisation of which at the present time is out of date. It has been said that we require an Army at the present moment because of the dangers of a private army. Is it not known that the alleged private armies in the country do not exceed four figures in numbers? They have no ammunition worth talking about. We are to maintain a huge Army with more officers than men at a huge expenditure when we do not require it because it will be of no use other than that to which it might be put, if somebody were to come across the Border. In that event, not alone would an Army be available but there would be sufficient volunteers as well.

If these savings were effected, the goodwill of the trade unions would be obtained and if the Government were really in earnest the trade unions would be prepared to make the necessary sacrifices. When they know that the sacrifices are to be borne only by one side of the community, the less wealthy people, then their co-operation will not be forthcoming. The trade unions warned that the food subsidies should not be interfered with. In my own constituency, I made a speech warning the people that, if Fianna Fáil were returned, the first thing they would do would be to abolish the food subsidies. I stated that the housewives would have to pay 4/4 or ? per lb. for butter. I pointed out that bread might cost them 1/1. When we were in office, butter cost 3/9 per lb. I told them that Fianna Fáil would take their revenge, remove the food subsidies and put up butter to 4/4.

The Tánaiste contradicted that statement and said that the food subsidies would not be interfered with. I know he is a good Irishman and a good politician, and I would say nothing to him. However, I can imagine how vocal the Tánaiste would be if he were on this side of the House. I can visualise the headlines in the Irish Press: “Labour and the Coalition Betray the Electorate of this Country.” Protest resolutions would be organised by Fianna Fáil members of trade unions demanding wholesale resignations because of the hardship to be inflicted on the people. Now we are asking the people to make sacrifices in the interests of a small section. I proved that the two wealthy sections are getting all the facilities and privileges, while the other section are being asked to make the sacrifices.

I am one of those who intend to secure for the workers the continuance of their present standard of living. I can guarantee that the trade unions will be loyal to their members. That is their duty. They have made too many sacrifices not to endeavour to maintain for workers the standard of living they have succeeded in securing up to now. They will not foolishly accept some of the statments by Ministers. They do not believe in having one small section make all the sacrifices, while the remainder get the concessions. If I had my choice, I would vote to keep on the taxes on the items I have mentioned; I would vote to reduce the Army by £1,000,000 and I would vote to reduce the Department of External Affairs. We are spending money on representatives abroad who have failed to secure anything for us. If we want to have industry here, we must send out men who will endeavour to show to the people in other countries the facilities there are in this country.

I am glad to see the Lord Mayor of Dublin here. For the period he was abroad, I believe he did more than all our ambassadors have done for the past 35 years. Why spend money on having these people there merely for the sake of our name? We are told by various Ministers that the cost of government is falling heavily upon the people. Why not make a reduction at that end before increasing the burdens on the poorer section of the community?

There has been talk about stability. We are not living in a fool's paradise.

We know we will have a sixth-round wage increase demand. The organised workers will be able to secure an increase. What will become of the middle classes and the groups with no organisation? When the docker gets his increase, that will be passed on again to the general community. The employer will not suffer any loss; the community will have to pay. Apart from the increases on butter, sugar and bread, there will be further increases because of the increased cost of petrol. It will mean increased distribution costs in the rural areas far from the principal ports. When goods have to be transported 50 or 60 miles, the businessman cannot be expected to pay the increased costs resulting from increases in insurance and in the price of petrol. He cannot sell his goods to the rural shopkeeper at the same price.

We will not have the stability we all hope for. The middle class section and the weaker section of the community will suffer as a result of this Budget. I believe you could have got the co-operation of all Parties, if you had allowed the food subsidies to remain for the time being and had removed instead the cost of administration in the various matters I mentioned. The Tánaiste pointed out recently that crises had taken place in the country year after year for the past 15 or 16 years. That was not the story during the elections. "Wives, put your husbands out to work.""We have plenty of work for you." We had all hoped there would be plenty of work; but you will not get work for the unemployed by taking off the food subsidies and so creating a demand for higher wages and forcing the unions to take the action they are bound to take to protect the standard of living of their members.

I can picture what is happening in agriculture. Take the case of the farm labourer, upon whom we are so much dependent for the necessaries of life and upon whom we are so much dependent for increased agricultural production. He is living in the rural area where he has to bear extra costs. Deputies from the rural areas know that things will be dearer for him. In one part of Wexford I believe flour is 2d. per stone dearer than places nearer to the cities. Fianna Fáil Deputies from Wicklow said: "Give the Chief his majority." He has got it now and what have we got in return? They were able to secure the people's votes and they came in here and voted for the Budget. They were entitled to do so and I am not quarrelling with it. However, they should have told the people of the country first that they would not inflict these hardships upon the rank and file.

As the people accepted the statements that were made we now have no alternative but to criticise the Government's policy, to try to convert the people, to assure them, if they do not already know, the serious mistake they made when they gave Fianna Fáil such a majority. Maybe it will be said that the inter-Party Government might have been forced to put up taxes. Perhaps they would, but the Labour Party would not support any Government that would inflict further burdens on the masses.

An Leas Cheann-Comhairle

Deputy Everett must address the Chair.

Mr. Everett

I am sorry. Deputy O'Malley and myself are very good friends and I will not keep him until 6 o'clock. I can assure the Deputy that an inter-Party Government would never have attempted to withdraw all these subsidies. I shall not refer to the other taxes. I shall leave it to Deputy Norton to criticise the Government's proposal to give compensation to the bakers for increases in wages they gave to their workers. I would agree to give some compensation to the smaller bakeries who are unable to pay their way.

I do not want to be accused outside in the trade unions of failing to do something to alleviate the distress of the workers. Every effort I can make here to redress the grievances of the workers will be made. The trade union leaders do not mind a bit the sugar coated threats made by some Ministers against potential demands from the workers. We will meet such threats. I am speaking now as a member of a trade union. How are we going to have stability unless we restore the taxes on the £1,600 motor car and on the mink coat? When we do these things we can talk about fairness to the workers and the workers will accept the statements made. Trade unions will never allow the standard of living of their members to be reduced. In a short time there will be a further round of applications for increases in wages and the people will then see the hardships inflicted by this Budget. It will be seen then that the Government have blundered.

Mr. N. Lemass

I have not been in the House very long but I realise that the Government have to deal with vast sums of money. I never realised, though, that £4,000,000 here and £1,000,000 there could be found as easily as has been suggested by Deputy Everett. He said he could save £4,000,000 on the Army, cutting present expenditure by two-thirds. He suggested that an army of volunteers is all that is needed to do the job. According to him those men need not be trained. What he wants is an army of unpaid privates. The system of maintaining officers and N.C.O.s to train recruits at present and to train volunteers in an emergency is the only sensible approach.

I noticed that when Deputy Everett referred to the subsidies he was very careful to say they should be left in operation for the time being. When would Deputy Everett remove the subsidies—next year, in ten years' time, in 20 years' time when a Coalition might again be inflicted on this country?

Mr. O'Malley

God forbid.

Mr. N. Lemass

Some speakers have made references to the 1952 Budget. When Fianna Fáil came back again after this election they found a situation almost exactly the same as that obtaining in 1951. As a result of coalition government in 1951 we found our external assets had been reduced by half, by £106,000,000. In 1951 Deputy MacEntee as Minister for Finance found that the provisions made by his predecessor for public services were inadequate. When he introduced his Budget on March 12th, 1952, the problems were the same as they are now—problems of decreasing employment, of unbalanced external payments, of business recession and so on. These were tackled honestly by Deputy MacEntee then as they have been tackled by Deputy Dr. Ryan on this occasion. Deputies Norton and Everett, who pretend to represent Labour interests in this country, know that in one year after Deputy MacEntee's Budget there were 14,000 more in insurable employment.

Mr. T. Lynch

That is not correct.

Mr. N. Lemass

The Deputy can check the records. For example during the first coalition period 2,802 dwellings were built or reconditioned by the Dublin Corporation. During the next three years, under Fianna Fáil Government, 6,779 houses were built. Again, during the past three years, there has been a drop to nearly 4,000 houses. Similar figures which could be quoted prove that Fianna Fáil's approach is the right one. Our record shows that our approach has always been the right one. Our policy has always been the provision of more employment. "Get your husbands off to work," has been our slogan.

Mr. P. Byrne

To England.

Mr. N. Lemass

On the last occasion Fianna Fáil resumed office, 1,000 more people went back to work in the building industry. In the two years following the 1952 Budget, 1,500 more men were put to work by Bord na Móna. In 1954 there were twice as many employed on rural electrification as there were in 1950, employment on forestry had increased by 1,000, on drainage by 500, on emergency schemes by 400 and there were 3,000 more road workers employed. Accordingly, it can be said that the problem now facing us is one which has developed since 1954. During 1953-54 production was increasing. It was not increasing as quickly as might be hoped, but employment was going up and unemployment going down. Although the rate of progress was not as rapid as we would have wished, we were going in the right direction. When we took office this year things were going in the wrong direction.

In 1954, things were going in the right direction. Exports were increasing. In that period there were no serious problems relating to international payments. What is more, Fianna Fáil were able to maintain the capital investment programme, which was as extensive as it was capable of organising. That capital investment programme provided this country with the amenities which any modern State would expect to have. Of course, the main thing was the giving of employment to many tens of thousands of Irish workers—employment which has contracted in the last 12 months. They can refer to the Organisation for European Economic Co-operation. Towards the end of last year the O.E.E.C. were reporting on the conditions in the Republic of Ireland.

Mr. Everett

The Deputy forgot to tell about the Standstill Order.

Mr. N. Lemass

They were reporting on the conditions in the Republic of Ireland. I quote that report:—

"Ireland's capital economic situation began to deteriorate in 1955 after seven years of internal financial stability and lower external deficits."

I think nothing could be more damning to the last Government than a comment like that, coming from a body which is not prejudiced by Irish politics in any way, an outside body looking at this country with ordinary interest and not caring about internal political problems here. Nevertheless, they made that statement, so it is not just the Fianna Fáil Deputies who maintain that the problems which are facing us, the problems which led to this Budget and to the severity of it, if you wish, are strictly a result of the mismanagement of our affairs since 1954.

Some people may ask why the O.E.E.C. report referred to mid-1955, why it did not start the minute the Coalition Government came in. The obvious reason for that is that when they took office the last time they were working the Fianna Fáil programme and it was not until they got properly into their stride in the Blueshirt way that the country started to go down.

Mr. T. Lynch

Leave the Blueshirts out of it.

Captain Giles

His father sold a good deal of them.

Mr. N. Lemass

It was my grandfather. No, white collars were the things in his day.

The Minister for Finance, in making his Budget statement in 1955, referred to the satisfactory trading position—a position, of course, which they had inherited from Fianna Fáil. He assured the House that he had every hope that the improvement in the country's position would be maintained. The Taoiseach, much later in the year, introducing his Estimate, dismissed as completely unimportant the worsening of the import and export trading position.

At that time he gave a very optimistic forecast as to what would happen in the future. All those assurances were proved by events to be completely worthless. The position became much worse, until the Government panicked and introduced its famous policy of restriction. We hope this policy of restriction has been abandoned now, once and for all, and that business firms will be able to expand without any obstacle being put in their way by the Oireachtas.

I believe it will not be long before this expansion gets into full stride and we can see people being put back to work—for that is what we did before and that is what we shall do again.

Mr. Everett

There were 150,000 unemployed at one time.

Mr. N. Lemass

If the Labour Party had supported Fianna Fáil in doing these things, it would have a bigger group here, I believe, than it has to-day.

Mr. Everett

Who let us down?

Mr. N. Lemass

Deputy Everett should know. Deputy Norton, speaking on the introduction of the subsidies in 1947, said, as reported at column 435, Volume 108:—

"The highlight of the documents put before us is, I take it, the subsidies to reduce the prices of tea, bread and sugar. I think these are sham reductions."

He left you about £5,000,000.

Mr. N. Lemass

——or that the cost of Government services would be up by £5,000,000. Why were not those facts made clear before the election? Then Fianna Fáil might have been able to answer those questions.

I also take it from Deputy Everett's address here to-day, where he says he will support the trades unions and so forth, that he is making it quite clear that he proposes to take every step in his power to see that there is a general all-round increase in wages.

Mr. McQuillan

There is no need for anybody to go on hunger strike. The Budget has looked after that.

Mr. N. Lemass

If that is what is in Deputy Everett's mind, it is a bad show and I am suggesting that Deputy Everett should look to see what happened in the period 1952-53 and 1953-54, take into account the number of people who found gainful employment during that period and take into account all the work that was done. Deputy Everett should be very slow to advocate either that or even to go into the lobbies against this Budget.

I will conclude by repeating the words of the Minister for Finance in his statement. He said at column 961, Volume 161, of the Official Debates of 8th May, 1957:—

"We cannot hope to solve all our problems at once but, with the co-operation of every section of the community, they can be reduced in scale and urgency and the way prepared for the achievement of what will always be the objective of this Party—permanently higher living standards for all."

Mr. T. Lynch

It is great to be young and enthusiastic, I thought, when I heard Deputy N. Lemass expressing how appalled he was at the manner in which Deputy Everett had mentioned one or two million pounds. He had not, of course, been in the House when his father was shouting here a year ago about his plan for £100,000,000. That seems to have gone off into Limbo.

Mr. O'Malley

The child is father of the man.

Mr. T. Lynch

Not in this case when he was querying a million pounds and his father could produce a hundred of them out of the hat. Like many other Deputies I went down to my constituency last Sunday and I was told, of course, in every place that there were Fianna Fáil victory celebrations. This poor lone Deputy went off to a Fine Gael dance last Sunday night and he was unable to get into the village. There were 800 people at that dance; they all paid and the place was not plastered with paper tickets.

I have an opus here and I want to talk about it. When Deputy Dillon was addressing this House on the Budget, he mentioned the present Taoiseach and described him as the old practitioner. Some people did not like that. I thought it was a little bit on the bone myself, but afterwards, having read the Taoiseach's speech and some of the other Budget speeches, and having listened to them, I came to the conclusion that there was a lot in it. These old doctors always gave you the mixture as before, and somehow or other in the election campaign the mixture was dished out as before.

Down in my constituency this magnificent document, dated 21st February, 1957, was sent out to the people. It says:—

"...A promise to farmers to maintain the price of wheat has been broken. The drop in wheat prices threatens not only the farmers but the entire community which relies for its food on the farmers. Yes, it is a bread and butter election. The Coalition is taking the bread out of your mouths and is buttering you with the only butter they think you are worthy of—golden promises which are broken."

It was a kind of treason if any of us said on a platform that if the Fianna Fáil Government were returned to office, they would remove the subsidies. This document was being prepared and it was the mixture as before.

"Anything the Coalition promises to do you can do better, with the inspired leadership.... We call back the emigrants who, during the dismal reign of the Coalition, have fled before a 1957 famine...."

This again is the old mixture as before. You must always have the Irish language, Ireland free from the sod to the sky, and resurrect the bones and the record of any worthy patriots that you can think of because they claim them all to have been cumann members, no matter what age they lived in.

Deputy Lindsay spoke about this famous night in Belmullet, and why I can talk about this was that on the same night the Fianna Fáil Party not only had its political atom bomb ready to explode at the far western corner of the country in Belmullet, but they also had galloping down to my constituency of Waterford the then Deputy Seán Lemass, who delivered himself of this opus. This is from his own kept paper the Irish Press, so I cannot be accused of doing anything with it. I am reading it now as quoted by Deputy Dillon at column 1297, Volume 161, of the Official Debates of 15th May, 1957:—

"Some Coalition leaders are threatening the country with all sorts of unpleasant things if Fianna Fáil becomes the Government—compulsory tillage, wage control, cuts in Civil Service salaries, and a lot more besides.

A Fianna Fáil Government does not intend to do any of these things, because we do not believe in them. How definite can we make our denial of these stupid allegations? They are all falsehoods."

When he was delivering that, the mixture as before had been prepared over in Mayo. There was an army with banners marching into Belmullet, with the thunder of drums, blazing turf torches, tar barrels and all the usual paraphernalia. The people were prepared for it; the walls were plastered with the famous poster that must have cost thousands of pounds because you could not look anywhere without seeing it. It was even stuck on my own gate:—"You can trust Dev." This caravanserai marched into Belmullet and some Deputy said the whole business was Machiavellian. Poor old Machiavelli! I would say his spirit was there to sit at the feet of his master. The famous speech was delivered there, something on the same lines as that of Deputy Lemass, now Minister for Industry and Commerce —"You know the record of Fianna Fáil in the past. You know that we have never done the things that they said we would do." Now I will have to take you back to Waterford.

Deputy Lemass had to dash down to Waterford, climb on to the platform and, in his most brilliant fashion, say: "Let's get cracking." Having delivered himself of what I have told you here, he got down off the platform, refused all the hospitality they offered him— they had a meal ready for him, but he had to go back—and went back to Burgh Quay into the recesses of the Irish Press to polish up the Taoiseach's speech that had to be got out next day. The whole thing was reminiscent of Lars Porsena and the march on Rome, and of the messengers being sent out to east, west, south and north. The Irish Press vans dashed out to east, west, south and north and the news was read and they said: “You can send out the station wagons, the highpowered cars, and the mugs will come in to vote now. We get the highpowered cars for nothing from the industrialists. They are pouring into us. The dance hall proprietors will pack in the money for us. We have the posters around the walls; we have the prescription; we have the mixture as before.”

Some years ago, somebody asked the Fianna Fáil leader: "What about unemployment?" and he was able to solve that in his usual magnificent way —"I will do away with it" and it was brought out in a beautiful green handbill—as the Deputy said some years ago, a green bill for a green people.

I have discovered that what is worse than the price put on to these various commodities is the feeling of resentment of the people against the deceit that has been practised on them. We have saved a couple of millions, by doing away with the butter subsidy in order to do away with the levies, so that we can have these highpowered motor cars that Deputy N. Lemass talks about and the fur coats, the mink and the chinchilla and the newsprint. Would it not be better to have left the levies on and to have left the butter at the price it was? Do the members of the Government realise the seriousness of this? Do they realise what is happening in relation to butter? Butter is piling up in the cold stores. Nobody can give an estimate of what it is going to cost to subsidise butter for export in order that we can sell it cheap in England next year and leave our people without it. What is going to be the position of these dairy farmers?

There was a very potent sentence from the Tánaiste when he was speaking on the Budget. Because of the uneasiness of dairy farmers at the present time, and the uneasiness that exists in dairy and creamery districts, a statement must be made by the Government. People are going around and saying we want increased production. We might as well ask it here and now: do we want increased production of butter? We are in a very good grass season. Milk is pouring into the creameries. Sales of butter are dropping in the shops. Butter is piling up in the cold stores. It cost £350,000 for storage last year. What will it cost this year and what will it cost when we bring it out?

"It brought the question of the price being paid for milk to the farmer and the price being paid for Irish wheat on to a false plane——"

he was talking about the subsidies——

"It created the illusion amongst those who were concerned with these things that increases could be made without consequences. I am not going to argue whether increases are justified. I think it will be a good thing for the country if it becomes more generally realised that alterations in regard to wheat or milk prices will have consequences and they have to be kept in mind when decisions are being made. It was a completely false atmosphere in which these matters were discussed while these subsidies were in existence."

I hope the Irish farmer will read that because I think they are getting the double blister ready for him.

On the question of wheat and its storage, the position is—and it was mentioned to the Minister—that we have an enormous amount of wheat in store. It was even said from the Government Benches that we have too much wheat. I have also said that there should be a statement made from the Government Benches on this question; do we want increased wheat production?

There has been a great deal of talk, too, about the wonderful policies of Fianna Fáil. Fianna Fáil has gone back on practically every one of its original policies. For years that Party endeavoured to destroy the Irish cattle trade. For years, they were saying: "Thank God, the British market is gone." Now they are here crying out about our financial position and our adverse balance of payments. Where would we be to day in relation to our balance of payments, were it not for the Irish live-stock trade? The Government intends to spend £250,000 on marketing. I hope that, when they come to spend this £250,000, they will not spend it on footling little things which will not bring in £50,000 a year. I hope they will remember the industry which is bringing in £45,000,000.

I should like the Government to note that practically all our live stock is carried in ships owned outside this country. We have built ships for Irish Shipping but we have not built any cattle boats. Last year, when we could have taken better advantage of the French market, we found we had not any ships of our own in which to send the cattle out. Ships had to be chartered elsewhere. They were, at best, makeshift. Many of them had not been constructed for the carriage of live stock and it was only because the officials of the Department of Agriculture strained a point and, in one or two cases, closed their eyes, that these boats were allowed to sail.

This Budget will have an impact on tourists. We like to give people value for their money. When I went in the other day to a small place that I visit on my way to and from my constituency, the first thing I discovered was that the meals had gone up by 3d. The old prescription—up, and up, and up.

I must revert to this £250,000 for marketing. Many industries here are what I describe as feather bed industries. Some clever fellow came along and he saw something being sold in a shop and he said: "I will pack that." He packed it and he employed 25 or 30 girls in the process. He was an industrialist. He was helped by the Government and he stuck the Irish consumer for another 2d. or 3d. on the article he was packing That is one type. Then we have the actual manufacturer. When the manufacturer found himself protected, he did not bother very much about anything any more. The tariff was a good pistol and he was just another Dick Turpin or Jesse James "sticking up" the public. If we intend to get anywhere with our industries, they will have to be based on export. It is a simple policy to base industry on export. I would draw the attention of this group or committee which will be entrusted with the expenditure of this £250,000 to some industries in my own constituency. There we have a paper and wallboard industry based on export. We have A.C.E.C. based on export. We have Clover Meats and Denny's based on export. We have Waterford Glass. Waterford Glass sets a headline to every industrialist in the country as regards initiative, enterprise and promotion in the sale of their product. Nothing leaves the factory except that which is perfect. It is to these things the Government should look when they go to market.

There is one other matter I must raise and that is the all too common use of the words "foreign" and "foreigner". We use the word "foreigner" as if the person about whom we are talking is so much stinking fish. We have Front Benchers here opening exhibitions and advising their audiences about "foreign" and "foreigners". At the same time, we have to sell our exports to the foreigner. The foreigner is our customer. The man who talks about "foreigners" has obviously a chip on his shoulder. Some of this goes back to our boyhood days when we listened to men talking at feiseanna about "foreigners" and "foreign". It is time we left that behind us. We are proposing now to spend £250,000 of the taxpayers' money selling our merchandise to foreigners. I use the word "foreigner" because of unfortunate force of habit. Let us call him "customer" in the future, and let us remember that the customer is always right.

There was one little ray of sunshine to lighten this all too sombre Budget. The Minister mentioned that £45,000 was being allotted by a benevolent State to Dunmore for ice-making and something else. It was a long time coming, but we are grateful for it. My constituency is a most unfortunate constituency. In it, there is a town called Dunmore and the people there buy boats with their own money.

Mr. O'Malley

On a point of order, is it in order for Deputy Lynch to go into difficulties which obtain in his constituency and the administration of a particular Department of State? These matters are matters for the Department of Lands, in my opinion.

An Leas-Cheann Comhairle

Deputy Lynch was in order in mentioning the matter, but he would not be in order in going into detail. The Deputy will get an opportunity of dealing with the matter on the Estimate.

Mr. T. Lynch

I am grateful to the Chair, but I deeply resent Deputy O'Malley bringing me to order or talking about order in this House. Above anybody who can talk about order in this House, I certainly do not want it from Deputy O'Malley.

Mr. O'Malley

The Deputy will get a lot more than he is looking for. Remember that, and heed it.

Mr. T. Lynch

That is all Deputy O'Malley can do—threaten. I will go back now to Dunmore because Dunmore was mentioned in the Budget. That sorry little gibe will not put me off what I want to say. This money will be very welcome in Dunmore. In the years gone by, we got neither boats, nor money, nor repairs nor piers; but we got the fish. We caught so much fish and we sold so much fish during the past eight or ten years that the Government had to give us recognition. A good deal of money has been spent on the ports. The Port of Waterford exports much more in money value than it imports. We have got small grants from the Government for the improvement of that port. The result of these small grants has been to effect a considerable increase in the earning capacity of the ports.

Lastly, I should like to stress a matter in reference to the dairy farmers. This applies to Deputy O'Malley's constituency in particular because there you have the best dairy farmers in the country. I want to know from the Government Benches are they recommending an increase in butter production? If they are and they have a surplus, what will that surplus be or what will it be estimated to be and who will provide £10 per cwt. to help foreigners to eat it?

Captain Giles

What I do not like about the Budget is that it brought joy to the moneyed classes. That is something which is very alarming and it is something which I personally do not like. This Budget is a dangerous experiment. It is the experiment of a strong Government chancing its arm. If they can pull it off, it is all right but if they cannot it may be very serious for the country. I agree that many deserve what they got because they saw what happened in 1952 and they knew it would be repeated. It was repeated and I hope that the blister they have got will be a reminder to them for many a long day.

With regard to the food subsidies, I do not believe they should remain there for ever, but when times are more or less normal they could be taken off in easy stages. They should be taken off to the extent of £1,000,000 or £2,000,000 over the years in order to ease the position, but to take them off overnight on a people who are living on a very meagre fare is unjust and unnatural. It is something a Christian Government should not do.

Bread, butter and tea constitute the normal diet of the worker and small farmer. He has very little in the way of meat or savouries. Bread, butter and tea are the commodities which are struck hardest by the present Budget. If you strike you ought to strike at those who are well able to take the blow. The biggest blow has been given to the old age pensioner and the widow. The Budget has taken almost 5/– per week off them. That is the biggest insult which ever took place in this country and it will not go unanswered.

This Budget will start a chain reaction and, if it does, it can have very serious consequences. We will have another round of wage increases. I am certain about that because the people who are fleeced will not take it lying down. We are playing to the Left Wing. The Connolly Clubs are not only very active in Britain but in Dublin and we are playing into their hands. We are playing with fire and we are giving those clubs the opportunity they sought for almost 20 years.

A Budget debate to my mind is always more or less unreal. There are too many pious platitudes from every side of the House. I am a member of the House for very many years and I am sick of this annual rehash. We have Deputy Corry lambasting everybody in a most unreasonable and unnatural way. It is time we adopted a calm and dignified way of discussing the affairs of the nation in this House. It is time that Deputies of that type should be reasonable and sensible. If they cannot be so, their leaders should endeavour to bring them to their senses so that they will debate matters on their merits and nothing more.

A change of Government often brings results but I do not think we will have any results from this change of Government or from this Budget. What the country needs is not so much a change of Government as a change of heart. As one who lives in the country, I can say that apathy exists on all sides no matter what Government is in power. Political insincerity is the cause of most of it. Our people are always told, when there is an election in the offing, to expect big things. When the election is over and the Government returned, the bark is the same again. Very little is done. That is why the people are restive at the present day.

As one of those who speaks his mind, I say that what is wrong with the country is the battle for political supremacy which has been going on for the past 35 years between two gigantic Parties trying to gain control. That has a good deal to do with it. If we could break that up and get a national Parliament of the right type we would forget those old bitternesses, strifes and jealousies and get down to hard work.

An Leas-Cheann Comhairle

These remarks have no relevance to the Budget.

Captain Giles

This House never got down to work for the past 30 years, and hence we have the flight from the land and emigration to England, America and elsewhere. There is plenty of room in this country for all our people and for more if we had them. This is not a country that is down and out. We have no need to be down and out and there is plenty of money in this country if we try to harness it and employ it properly. Looking back over the years, I would say that this House is the cause of our whole national weakness. We started off 20 or 25 years ago with doles, social security and so on. All these were political palliatives to gain votes.

The same can be said about social security. I feel we are bringing our people not social security but social insecurity. If we had never heard of the Health Act, I am satisfied this would be a far better country.

Then we have children's allowances. It is criminal to give men money to rear their own children, if they do not need it. I know of people who have never touched the children's allowances which were paid to them. They are banking that money because they do not need it. It would be far better, instead of giving such well-to-do people these allowances, if we doubled the children's allowances payable to the poor.

The trouble with this country is that there is too much wasting of public money and too little sincerity. That is the reason why the nation is going down. At almost every step, there is national demoralisation. We now have a strong Government in office. They should utilise their strength to right the wrongs in our economy.

People are fleeing from the land. These people are not fleeing of their own free will. We are forcing them to go. The moneyed class is as strong and as vigorous as ever. We have the ranchers and other people with money to burn who will not invest one penny in an Irish loan and who invest all their money on the other side of the water.

An Leas-Cheann Comhairle

The Deputy must relate his remarks to the Budget.

Captain Giles

We should curb that tendency on the part of those people. Is it not time that some of that money was invested here? These are the things that count and, for want of being rectified, are responsible for bringing this country down. This strong Government should get down to bedrock, face realities and get away from political play-acting. If taxes must be increased, they should not fall heaviest on the old, the sick and the infirm but on shoulders best able to bear them.

This Budget is a cruel injustice on the people and it is a cruel injustice on members of the Fianna Fáil Party because I know they did not expect it. It is playing up to the moneyed classes. Read the Irish Times or any of the British newspapers. You will find flattering references in them to the sincerity of the present Taoiseach and his Government. He has played up to the moneyed classes, to the Jews, to the Masonic Order, but not to the old people or to the sick or to the infirm.

Mr. O'Malley

The Deputy forgot to mention the Knights of Columbanus.

Captain Giles

They are there all right, and there would be no need for them if the others were not there.

Mr. O. Flanagan

On a point of order, is the Leas-Cheann Comhairle going to permit Deputy O'Malley to make that interruption concerning the Knights of Columbanus? It was an unjust, wrong and ignorant interruption.

An Leas-Cheann Comhairle

The Chair cannot see anything disorderly in the Deputy's remark, but it was a disorderly interruption.

Captain Giles

It was made from pure ignorance and I accept it from an ignorant man. When I look through the Budget and find an exemption of duty on high-powered cars, television sets and wireless sets, what must I conclude? Must I not conclude that we are playing into the hands of the big monopolists, Jews and Masons? I am not afraid to say it. Who are the directors of those big monopolies who are able to force a Government to do that? Certainly, it is something worth thinking about. They are playing up to the money changers and the international Jews, and nobody else. It is humiliating that this Parliament must become a tool of those exploiters. One hears a lot of platitudes about "Dear old Ireland" from the Government side of the House but they are a gang of impostors and nothing more.

Mr. O'Malley

I have listened to most of the Opposition speeches on this Budget and I am very sorry to say that, up to the present, not one speech has contained anything like a constructive suggestion. All the time the cry has been about "the appalling Fianna Fáil Government" and the "hardships" they have imposed on the poor sections of the community, and so forth —a typical Giles cartoon.

I am sorry the former Minister for Justice, Deputy Everett, is not in the House at the moment. He was a bit of a prophet when he spoke at Bray in February, 1957, according to the report of his speech which appeared in the Press on the 18th of that month. He must have realised, in view of his statement then, how bad, in actual fact, was the condition of the State's finances. We read in the Cork Examiner of 18th February, 1957:—

"Mr. Everett, Minister for Justice, at Bray yesterday said that it was certain that if by some trickery or deceit, Fianna Fáil should win this election and sneak back to power they would abolish all food subsidies and instead of from 3/6 to 3/9 for a lb. of butter we would pay 4/3 or 4/4, and the 2-lb. loaf of bread would be increased from 9d. to 1/1. That was not the only way in which Fianna Fáil would attack the workers and the poor."

We have heard members of the Opposition—Deputy Everett himself and the illustrious Deputy Giles—suggest that these increases work out at 5/– per week, or something like that. I cannot fathom how this figure is arrived at, so far as the removal of the subsidies is concerned. Here is what Deputy Everett had to say last February when he was Minister for Justice in the Coalition Cabinet, after forecasting the exact increases:—

"That meant that old age, widow and blind pensions will be reduced by 1/3...weekly."

We gave one shilling to those people. We do not say it is as much as we should like to give them. Evidently, however, according to Deputy Everett's calculations, they are at a loss per day of three-sevenths of one penny. So much for that.

Deputy Everett was not as successful in all his forecasts as he was on the question of the removal of the subsidies. Furthermore, despite those forecasts from a responsible Minister of State in the Coalition Government, the people of the country must have said to themselves: "The position must indeed be very acute with the National Exchequer," and decided to vote for Fianna Fail.

Deputy Everett, the then Minister for Justice, was not very successful with this prophecy:—

"The Deputy Leader of that Party——"

that is, the Fianna Fáil Party——

"——had also stated that in addition to existing taxes everybody's income should be further taxed at the rate of one shilling in the £1. That meant that old age, widow and blind pensions would be reduced by 1/3 or a worker earning £5 would have to pay a weekly tax of 5/– before he could take home his wages."

So much for Deputy Everett's remarks. I shall quote now some remarks made by the former Tánaiste, Deputy Norton, whose utterances are very well known throughout the State. When subsidies were introduced for the first time by Fianna Fáil in 1947, due to the circumstances which obtained at that time, this is what Deputy Norton had to say:—

"I think these are sham reductions. I do not think they make any perceptible contribution to relieving the plight of the ordinary working people to-day and they make a less perceptible contribution in the circumstances in which they are offered. I took the trouble of trying to calculate hastily what the reductions in the prices of tea, bread and sugar mean to a family of six people."

He then said that a family of six would save 3/10½d. He pooh-poohed the idea. Then he continued:—

The members of the Labour Party and their quondam colleagues in the Fine Gael Party have evidently entirely different views to-day.

I trust I shall have some constructive suggestions to offer to the Minister without replying to all the futile arguments and speeches that I have heard from members of the Opposition. The butter subsidy question was mentioned by Deputy T. Lynch of Waterford, who wanted to know what the Government intended to do about the matter. It is quite obvious to anyone that the question of the dairying industry is one which will, of course, require the immediate attention of the Government. It is a very serious problem and one which costs the State a substantial amount because of the necessity to subsidise the export of butter annually. The output of milk at the present time has risen to figures which, it is said, are unsurpassed.

I ask the Minister to bear in mind that the Government might consider subsidising the export of chocolate crumb. I say that because, comparatively speaking, the margin required for chocolate crumb to get into the British market competitively is much less than in the case of butter and as we all know the amount of milk used by the chocolate crumb factories in the past was tremendous, and in my opinion, it is a matter which should get very serious consideration. It would give employment at home; it would help the existing chocolate crumb factories, which to a certain extent have fallen on lean days, particularly those who did not have sufficient foresight to manufacture powdered milk or other products which some of the more adventurous sections of the dairying industry have produced. I would ask the Minister to bring this suggestion to the attention of the Government.

The Minister, during his speech, congratulated the former occupant of that office, Deputy Sweetman, on the success of the prize bonds. Undoubtedly Deputy Sweetman deserved those congratulatory remarks on the success of the Prize Bonds per se, but I should like to ask the Minister and the House whether or not it was a wise thing, in fact, to have introduced this scheme of prize bonds here? To me it appears that henceforward we can never again hope to see, irrespective of what Government is in power, a National Loan having the same success as in the past. The prize bond system is far too attractive to the ordinary man in the street, and even to the big companies—the figures that were given showed the proportions of those who subscribed from all sections of the community. I do not think, in view of the continuation or the expected continuation of the prize bond scheme, that those people will ever again contribute substantially to what we know as National Loans.

"The deficit, under what you might term a 1954 Fianna Fáil Budget, was brought down to negotiable proportions—£5,500,000. As the Minister said, the receipts from abroad virtually balanced these external payments. He continued by expressing the hope that our exporters, with the assistance of Córas Tráchtála, would increase their business. Yet no concession has been given."

No concession was given in the Budget of that year. I continued, and Deputy O'Sullivan did not think it worth his while to refer to this matter:—

"In my view, that is one of the most unfortunate features of this Budget. I am not dealing now with the increase for... I welcome these increases, such as they are. I am dealing now with a certain matter of Government policy which affects everybody in this House. It is all right for a Minister to speak at a public dinner or to open a factory and to express the sentiment that it is only by increased productivity that we can improve the standard of living in our country. There is no incentive whatsover to industrialists in this Budget such as some tax concession. I am not speaking specifically now about the wear and tear allowance. I have in mind some tax concession for those who might be engaged in industry in the export line. I do not see any concession given—and the facilities of Córas Tráchtála are there and the co-operation of Córas Tráchtála is there.

Where is there any remission in tax by the Government to exporters? I say that such a remission could be given. The Minister may say it would be a complicated issue to differentiate between the proportion manufactured by the concerns for home consumption and the proportion manufactured by the same concerns for export. There is the hope that this body which is examining industrial profits and so forth——"

The former Deputy, Mr. S. Collins, interrupted to say:—

"Is the Deputy looking for an export subsidy?"

I concluded by saying:—

"All Governments are agreed that in this country it is necessary to bring down as much as possible the cost of commodities for export in order that we may become competitive in the export market. I am suggesting that, in order to encourage exports, the Minister should give such a concern a reduction in taxation, or some such thing."

The fact that in this Budget the Minister for Finance, Deputy Ryan, has seen fit to give these concessions shows that, as it has been described by all responsible newspapers and by those who are regarded as holding responsible views, it is indeed a realistic Budget.

Deputy Everett spoke about subsidies. I referred to him previously. He said that neither he nor his colleagues would dream of entering a Government whose policy was to remove the subsidies. I would impress on the House that it appears that Fianna Fáil will be the Government of this country for the next 50 years or at least for a considerable period, because——

Mr. Sweetman

It is quite clear that there will not be any country long before that if Fianna Fáil remain in office.

Mr. O'Malley

Now where is the sabotage that Deputy Sweetman cried about? Is it not very clear that if Deputy Everett and his colleagues will not agree to join Fine Gael who advocate the removal of the subsidies by degrees, over, evidently, three or four years, there is a deadlock on that side of the House, as there was, of course, long before they left office?

"Mr. Norton makes again, in his broadcast, a statement which he made in March, 1950, and which Mr. Costello had at that time to repudiate, namely, that it was the Coalition Government that abolished what Mr. Norton called ‘the Fianna Fáil wage standstill policy'.

The Order restricting wages was abolished by us long before we left office. It had, during a number of war years, helped to keep prices at a stable level, from which the families of the workers benefited most.

But need I deal with Mr. Norton's broadcast further? Not a single practical or constructive hint is given in it as to how the objectives which he says he has in mind, are to be reached."

Mr. O'Malley

Bionn an fhírinne searbh, go mór mhór dón Teachta. Deputy Mulcahy was not alone in his views. The former Attorney-General, Deputy McGilligan, waxed eloquent on 3rd February, 1951, and, in case I should be asked the source of this, it is from an article written in the Statist of that date. In the course of that article, Deputy McGilligan wrote:—

"Indeed, many economists hold that taxation cannot, without ill effects, be allowed to exceed 25 per cent of the national income. Fortunately, we are still within that limit, but when the upward trend in prices, in social services and in debt charges is considered, it is difficult to find means of easing the tax burden or even of keeping it within present limits.

In the past two years £3,000,000 has been saved on food subsidies by various means, in particular by marketing quantities in excess of a reasonable ration at economic prices. This year sugar is no longer being subsidised. Given an improvement in production and relative stability of prices, subsidies could be further reduced without hardship to any class and the burden of taxation correspondingly lightened."

That was Deputy McGilligan on subsidies. Does Deputy Sweetman think it fair or in the national interest to have allowed his followers to agitate for and to have encouraged the workers to seek increased wages? I can recall Deputy Sweetman in the first Budget he introduced in this House talking about the necessity for having stability in wages. Surely now he ought to curb the tongues of his followers in the national interest about which he waxed so eloquent in the past. If he thought, before he left office, that the position as such was satisfactory, then I should like him to refer to this matter of grave importance.

I understand that as a result of the removal of the subsidies the index price will be increased by 4½ points. We have had nothing but speeches from the Fine Gael Benches referring to the coming sixth round of wage increases. I do not know whether or not that will materialise. I presume that everybody in this House and every Government wishes to see the workers getting an honest wage for their daily work. I am just bringing it to the Minister's attention that, when in power and acting as Minister for Finance and in a responsible position, he cannot allow his followers to speak in a manner, which, to say the least, lacks responsibility.

Mr. Sweetman

The Minister for Finance will be very cross with the Deputy when he reads that in the Official Report.

Mr. Sweetman

I was attacked for bringing them in too soon by members of your Party. Which criticism is the Party criticism?

Mr. O'Malley

I have not seen that criticism. It would not be the first occasion Deputy Sweetman took remarks out of context. I will have to study the speech in question.

As I said earlier, my opinion counts for very little. Last year we had three Budgets. In March, these levies were supposed to yield £3,000,000. In May, the increases on cigarettes, tobacco, petrol, matches, mineral waters, betting and dancing were to yield £6,000,000. In July, just before the recess, we had the third Budget. In fact, it was the fourth; it was the third apart from the ordinary Budget. In July, Posts and Telegraphs came in for £500,000 and E.S.B. for £1,000,000. These measures were supposed to yield £3,000,000. £3,000,000 in March; £6,000,000 in May and £3,000,000 in July. That is £12,000,000 of extra money. I am wrong——

Mr. Sweetman

You are.

Mr. O'Malley

In what way, might I ask?

Mr. Sweetman

I shall leave it until I speak.

Mr. O'Malley

Mr. O. Flanagan

It is about the 100,000 new jobs I want to hear.

There is one matter I forgot to mention. I have not the Budget speech with me but I think the Minister for Finance mentioned that we were becoming members of the International Monetary Fund, not the monetary reform crowd with which Deputy Flanagan is connected. I am not conversant with the facilities or loans which this body might offer. Personally, I am against this country obtaining foreign loans as such. There is a big difference between foreign investment and foreign loans, but I understand that the facilities which this membership now qualifies us for are invaluable in so far as we can get information on agriculture, industry and 101 other things. That has been glossed over by many of the speakers here and they do not appreciate what exactly it means to the country. I think it will have very far-reaching effects.

In conclusion, the position is that we will have to put these people back to work as quickly as possible and it is with that aim—I repeat it over and over again—that this Government is working. When Deputy O. Flanagan and his cohorts choose to criticise us after six weeks in office, I would remind him of the inactivity and appalling plight which we have inherited after the past two and a half years of the Coalition Government. The day of the marches of the unemployed on the Houses of Parliament will be stopped, once and for all.

Mr. D. Costello

My criticism of this Budget is based on two propositions. Firstly, I think it imposes grave hardship on the weaker sections of the community and, secondly, it is a Budget which will retard economic progress. I say that the hardships imposed are unnecessary because I believe the arguments which the Minister for Finance and his colleagues have put forward are based on false reasoning. He justifies the abolition of the food subsidies on two propositions, first, that the Government had to balance the Budget, and second, that to balance the Budget, it was necessary to abolish the food subsidies.

I accept the first statement, but I vehemently deny the second. The savings to the Exchequer through the abolition of the food subsidies this year amount to £7.1 million. The Budget proposes to give compensatory relief in social assistance to the amount of £2.5 million and the net gain to the Exchequer is £5.15 million. The Government holds that there is no other way of getting that £5.15 million and that the only way to balance the Budget is to cut the subsidies.

I want to suggest four ways in which this Budget could be balanced without cutting the food subsidies. I suggest that there are at least four alternative methods open to the Minister, if he saw fit to use them, and if he wished to avoid the step of cutting the subsidies. I am not advocating these methods. All I am saying is that there are other methods and that it is nonsense to suggest that this was the only method by which the Government could balance the Budget this year.

The returns for last year show that taxes from import levies came to £4.25 million. It must be remembered that the levies last year were put into force in March and were increased in July, and that the increased levies were not in operation for the whole of the year. It must also be remembered that it is very likely that imports this year will increase over last year. Imports last year were down very considerably and in the last quarter were down 20 per cent. as compared with the previous quarter. It is a fair estimate that over a full year the levies would have brought in over £5,000,000, but they are not going to do it this year. The Government, instead, have cut the import levies this year, some of them, so that on the figures they are going to bring in only £2.5 million.

Had the Government decided to restore the levies, to bring back the levies they had taken off, and to save the £5,000,000, they could have got it from that, by transferring it from the capital account to the current account in the Budget and it would have been unnecessary to cut the food subsidies. The saving of £5.1 million which the Minister had to get, and which he got in the manner we all know, was there to be got by the import levies.

I know that transferring the import levies from capital account to current account would raise difficulties. I know there were grave economic difficulties facing this State and no matter what the Government were going to do, it was going to create difficulty, but I suggest that the Government should have taken the remedy which would cause least social and economic upset to the State. I know there would be difficulties on the capital account as a result of removing the revenue which the levies brought in from it. I only suggest it would have been better economically, and better socially, for the Minister to have balanced the Budget this year by that means rather than by the means he did adopt.

At the week-end the Minister and his colleagues and various Government spokesmen said that there were no concrete suggestions put up by the Opposition in the debate on the Budget. This suggestion was put forward by the Opposition very early on in the debate and it has not so far been answered.

There is another means I would suggest to the Minister of getting a saving of £5.1 million. The grants to the local authorities in relief of agricultural rates amount to £5.6 million. The Minister could have got the money there. He could, if he wanted to, have cut the grants to local authorities. It would have an effect on the ratepayers and on the local authorities and the farmers would have to pay more rates. It would have an economic effect, but the Capital Investment Committee did not think the economic effect would have been so severe. I am not suggesting that it would be the proper method of balancing the Budget; all I am saying is that there was another way of doing it. The Government took a bad political decision, an economic decision that they would not put the hardship on the rural community that they have put on the urban community.

There is another way in which the Budget could have been balanced. Do Deputies realise that there is £5.2 million coming into the Exchequer from taxation of motor vehicles? Do they realise that the proceeds of motor taxation, which is indirect taxation, go to building roads and repairing roads, which is merely a capital item? I suggest it is open to the Government to treat motor taxation as any other form of taxation, and bring it into the current account, and so balance the Budget. I am not suggesting again that this would not cause difficulties. It would mean that there would have to be £5,000,000 found on the capital Budget in order to pay for the roads, but what I would suggest is that it is possible to get that £5,000,000, or what-ever sum it is decided to shift to the current account, from the proceeds of motor taxation and that it would have caused much less social and economic difficulty in this State.

The fourth method I suggest is to combine the three methods I have mentioned. I suggest that there is not a Deputy in this House who is not conversant with conditions in our towns and cities and who does not know that in our towns and cities there are people living on the borderline of destitution. To my own knowledge, there are people going hungry. To my own knowledge, and I suggest to the knowledge of many Deputies here, there are people going cold because they cannot purchase adequate fuel. These are the people whom this Budget will hit.

I should like to ask the Minister a question: what could the Minister do with £2,500,000? Could he, for example, increase unemployment insurance, which he is not increasing under this Budget? Could he increase widows' contributory pensions, which he is not increasing under this Budget? Could he increase the T.B. allowance to those suffering from T.B., to those who will have to pay more for their bread and their butter but who, under this Budget, will not get any compensation? Could he increase pensions to retired local government officials or civil servants who are living on pittances at the moment? The Minister has this £2,500,000 in taxation. He has it in the Capital Account and I suggest that it should be pushed from the Capital Account into the current account and used to assist these people. He has it from the levies; he has £2,500,000 coming in from the levies, being used in the Capital Account.

The Government in 1952—the last period during which Fianna Fáil were in office—cut food subsidies. They agreed then that it was necessary to give compensation. They agreed it was necessary to compensate all recipients of social welfare benefits and not just the social assistance class. They agreed it was necessary to compensate those who were on unemployment insurance and widows in receipt of contributory pensions. They were given compensatory benefits to offset the cut in subsidies in 1952. No compensation has been given in this Budget. In this Budget only that class known as the social assistance group is getting any benefit, and the members of that group are getting 1/– per week. This figure of 1/– per week is based on what I might call a cynical miscalculation; it is based on the average increase in cost throughout the State of the increased price of certain commodities as a result of the abolition of the subsidies. Everybody knows that the poor eat more bread and butter —bread certainly, and butter when they can get it at a reasonable price— than the wealthier classes do. I am of the firm conviction that what the Government has done to the blind, the old, the infirm, the widow and the unemployed by their actions in this Budget is morally unjustifiable.

I want now to refer briefly to a certain aspect of the economic situation which has not been sufficiently stressed. The balance of payments deficit in 1956 was £14.4 million. In 1955 it was £35.5 million. Last year's reduction in the balance of payments amounted to some £21.1 million. But for an adverse movement in the terms of trade, this deficit would have been reduced by a further £7.2 million. Let me remind Deputies now that exports have increased in volume; that in the last three-quarters of last year they increased by 8 per cent., 10 per cent. and 9 per cent. respectively over the similar quarters in the previous year. Let me remind Deputies also of the fact that, for the first four months of this year, there has been an increase in exports by as much as £12,000,000. Whatever economic troubles this Government have to face, they do not have to face a balance of payments problem. The effect of movements last year and the results of actions taken by the last Government are to be seen in the banking statistics, statistics which, I think, are of great relevancy when dealing with the capital sides of this Budget.

It is recognised, in view of the fact that there has not been an inflow of foreign capital, to which we were accustomed, and as a result of the fact that we have not got the American loan to fall back on, that deficits in the balance of payments now reduce the sterling assets of the banks. This, of course, affects their ability to lend at home, as increased banking credit means more cash requirements, which, in turn, involves the transfer of sterling to the Central Bank. But the banks have not that worry this year. The deficit in the balance of payments was dramatically reduced last year and, in relation to their lending policy both to the Government and on private account, they need not fear the effects of that policy on the balance of payments position. Last year, in fact, the net external assets of the commercial banks increased by £2.674 million but that net figure does not give, to my mind, a true account of what happened last year because the banks' gross external assets increased last year by £11,000,000 and the rapid improvement in their position is to be seen when the figure for the June quarter of the last year is compared with the March quarter of this year. In that comparison it will be seen that their gross external assets increased during that period by £17,000,000.

I have always held the view—I do not say this because I am in opposition; I said it also in the last two and a half years when I supported the Government—that the Capital Budget of this State should not be limited by the amount of the annual subscriptions which can be obtained from the public. I welcome the decision of the Government to have recourse to the banks this year to finance the capital investment programme inasmuch as there is a shortfall from direct subscriptions to it from the public.

There are a couple of questions about the Capital Budget that I should like the Minister to answer. First, is the rate of interest that it is proposed the banks should get for lending direct to the Government decided? Is it proposed to pay the banks 5 per cent. or whatever rate of interest is paid to ordinary savers who forgo their income to lend to the Government? Or is it proposed that the rate of interest shall be lower?

I should also like the Government to consider the possibility and, indeed, to my mind, the desirability, of investing some of the assets of the Central Bank in Irish Government funds. I do not think it is justifiable for the Central Bank to have 100 per cent. backing of its note issue in foreign securities. I can see no economic reason, and no financial or social reason, why the Central Bank should not have a proportion, at any rate, of its assets held in Irish Government securities. This is an operation which cannot be done overnight, neither can it be done in one year. But it can be done gradually and a start could be made this year. In that way the capital side of the Budget problem would be eased by the assistance of the Central Bank.

The Government, of course, play a large part nowadays in investment here. It would be desirable if private enterprise were sufficient to do all this, but clearly it is not. Clearly, the Government have to play their part in increasing demand and in bringing about conditions of employment by investing in large-scale capital projects. I think every Government should try to see as much capital on private account invested in this country as possible. The Government should seriously consider the introduction of a discriminatory tax against Irish citizens who invest abroad and not at home. I do not think there would be any administrative difficulties in putting a discriminatory tax on incomes payable to Irish citizens at home from British securities. Of course, I would suggest it be limited to Irish citizens since we must try to get as much foreign capital as possible invested here.

I welcomed the remarks of the Minister for Industry and Commerce concerning the Control of Manufactures Act, because he appeared to indicate that at long last the Control of Manufactures Act will be got rid of. Any step in the direction of bringing foreign capital into the country should be welcomed as a means of giving the necessary employment we all desire. I agree with the Ministers who said that this Capital Budget should be as large as possible. I am not one of those who think that expenditure on so called social capital should be cut down. For instance, I think that expenditure on housing, which is the big item in social capital outlay, must be maintained because of the very serious housing conditions which exist, particularly in the City of Dublin.

However, my criticism of this Capital Budget is that too small a part of it has been devoted to capital works of a productive nature. It is an extra-ordinary fact that out of the £40.99 million which is the amount of expenditure on capital services this year, only a little over £3,000,000 is being spent on agriculture. I have gone through the figures in the Capital Budget—the moneys devoted to the E.S.B., Bord na Móna, the Industrial Credit Corporation, An Bord Iascaigh Mhara and so on.

All these total only £13.69 million so that of the total Capital Budget only a very small proportion indeed is being devoted to matters of a productive nature.

As previous Deputies have said, we are very used to economic platitudes in this House. I suggest there is not a Deputy who is not in favour of full employment, who does not think agricultural production should be increased. Will anybody deny it would be a wonderful advantage to have industrial production increased? Nobody will suggest we should not have as much capital investment in the State as possible. All these matters are of common agreement. I see no point in making elaborate speeches or of occupying the time of the House in saying this is what this Government is aiming to do. We are all agreed on these things and my criticism of this Budget is that these aims, on which we are all in agreement, will not be achieved by it because the financial measures are such as to do the very opposite.

The economic effects of cutting the food subsidies will be very grave. May I refer the Minister to an article written by a very distinguished Cambridge Professor of Economics, Professor Pigou, in the Economic Journal for June, 1948? This was written on food subsidies. It concerned the particular English conditions of that time which were very similar to the conditions with which we are familiar—balance of payments problems and inflationary tendencies in the State. I should like to refer to some of the conclusions which he arrived at in a very balanced type of article on the economic effects of cutting food subsidies.

On page 205 of this volume, he says:—

"In normal conditions, with all essential foods reasonably abundant, and no rationing, subsidies on these foods would inevitably push productive power towards them in a greater degree than people, given their individual post-transfer purchasing powers, would have chosen to push it, had the State remained neutral as between different kinds of expenditure."

It is a fact which we cannot deny that subsidies do have the effect of increasing production on items on which they are placed. Can it be denied that the effect of withdrawing the subsidy will reduce the production of butter? That, in fact, was the effect of cutting the subsidies from 1952 to 1954. The Government preaches about the desirability of higher agricultural production and then takes a step which will inevitably reduce one aspect of it.

May I refer the Minister also to a very important statement in this article at page 206? This is one of the matters on which this side of the House has criticised the Government most strongly. Professor Pigou says:—

"It is common ground, too, that subsidies could not properly be abolished at a single blow, but only by a gradual process. So much being understood and allowed for, how does the case for and against abolition stand?"

Professor Pigou is arguing on purely economic grounds. He says that it is common ground that subsidies could not properly be abolished by a single blow. That is exactly what the Government have done. If the effect of the abolition of food subsidies is that wage earners demand and get increased wages, that, in turn, is bound to have a serious effect on our general economy.

At page 208 of the same journal, the article states:—

"Every rise in money wage rates (without an associated rise in productivity) would push up the prices of goods produced in this country and, even though further secondary wage increases consequent upon that are somehow prevented, the price is bound, provided that the dollar sterling exchange rate remains fixed, to hamper our exports, thus making harder the urgent and overriding task of closing the adverse gap in our foreign balance."

Later on the same page, Professor Pigou states:—

"On the hypothesis that money wage rates do not rise to offset the cut in subsidies this policy, while it would do nothing to modify the disincentive effect of the tax system, would obviously exercise a considerable disinflationary effect."

I believe that, whether wittingly or unwittingly, that is what the Government is doing by cutting the food subsidies. It is creating a disinflationary movement in this State just when we need the very opposite type of policy to bring about more production and more employment. The conclusion he arrived at in this article, page 209, is:—

"Unless the trade unions enter into an arrangement with the Government under which cuts in the food subsidies can be made without consequential increases in money wage-rates being called for, it is almost certain that they will be called for and will, moreover, in large part be conceded. Under the stress of our balance of payment difficulties an arrangement of this kind may perhaps be made. But there are as yet few signs of it. It is a thing to be aimed at. If we can get it, let us begin cutting the subsidies forthwith; if we cannot, for the present leave them alone."

I want to examine the effects of cutting the food subsidies on our economy —firstly, on the very rebuttable assumption that wages do not go up. What will be the effect? People will have to pay more for bread and butter. Certainly, it will have a deflationary effect—a fall in real wages and in incomes, less purchasing power, less demand for the products of producers.

A secondary effect of the cut in the subsidies will be a fall in savings. Of course, the Minister is increasing forced savings by this method, but I think that that will show itself in a drop in voluntary savings. Supposing there is a rise in wages; supposing that, in fact, the exhortations of the Minister are not listened to and that wages do go up to compensate for the rise of 4½ points in the cost of living. Will that not mean another twist in the cost-of-living spiral? Will it not affect our capacity to export? It may also mean that a number of businesses and firms will go out of production because they cannot afford to pay the increases.

I do not know whether or not the Government has examined the economic effects of cutting the subsidies. If they have, I should be glad to know the answer to my suggestions. If I am correct in what I suggest, I think the Government should have done anything rather than take the steps they did, in fact, take.

May I refer, too, to the effect on the future budgetary position of the cut in the food subsidies? Supposing there is no increase in wages: the cut in the price of necessary foods is bound to have a deflationary effect. There will be less money to spend on dutiable goods and there is bound to be a fall in Exchequer returns on dutiable goods. Will this also not affect Government expenditure in future years? There is the first obvious fact that public servants may require and may rightly get an increase in their salaries to compensate them for the rise in the cost of living. It is a first increased charge on the Exchequer as a result of the abolition of the food subsidies. Supposing they do not get an increase in their salaries: still, even if all the matters that are in this Budget are kept next year and the year after, there is bound to be an increase in the cost of Government.

As a result of cutting the food subsidies, the cost of living will go up by at least 4.5 points. The total cost of Government this year, capital and current, is £160,000,000. A 2 per cent. increase in the cost of living means that Government expenditure next year will go up by £3,000,000. If the cost of living goes up, as suggested, all the savings that are being made this year will be eaten up as a result of the increased cost of Government next year and the year after.

I have suggested that there is little use in the members of the Government Party and their supporters talking about the desirability of increasing production and of increasing employment. We want actions, not words. I should like to see them, in their own words, getting cracking. I should like to see them do something that will increase employment and production. I refuse to accept the view that this country is doomed to suffer a haemorrhage of 40,000 people a year leaving its shores and a cancer of unemployment at a rate of 60,000 or 70,000 a year. I refuse to submit to the view that this country is doomed to stagnate in an economic backwater. I believe the conditions we are living in are remediable. I think the years and the passage of time have sapped the vitality of the Fianna Fáil Party and that power over a number of years has in a curious and subtle way corrupted it.

If this Budget is an indication of how this country is to be governed for the next few years, I see little hope of an immediate amelioration of our present difficult circumstances.

Mr. O. Flanagan

I should like to comment briefly on the Budget which has been the subject of debate in this House for the past fortnight. It might be considered very strange if I opened on the note that I welcome the Budget. It might draw a gaze of amazement or wonder from my colleagues, but the truth is that I have very little sympathy—and I deliberately utter these words for the purpose of having them on the record— with the people who voted for Fianna Fáil and who are now suffering from the effects of this Budget. If you sow nettles, you cannot expect roses to grow.

When the people were casting their votes for the return of a Fianna Fáil Government, they understood and believed that Fianna Fáil had been taught a lesson by their defeat, arising out of the 1952 Budget, in the 1954 General Election. The people believed Fianna Fáil had been taught a very dear lesson, that they had mended their ways and changed their political conduct and that their outlook on the poorer sections of the community was a little more sympathetic. That again was reinforced by the solemn under-taking of the leader of the Fianna Fáil Party. The people believed him when he gave his word of honour and his pledge that there was no truth what-ever in the falsehoods, as he described them at that time, uttered in the speeches of the then Government Ministers, the candidates and their supporters who warned the electorate that the return of a Fianna Fáil Government would mean dearer bread and butter and a considerable increase in the cost of living and a considerable lowering of the standard of living.

It cannot be said that the people were not warned of the danger of a Fianna Fáil Government, or that they were not told in advance before voting. They did not purchase a pig in a poke. They were warned by the Fine Gael Party, by the Labour Party and by every other Party opposed to Fianna Fáil. They were told that the return to power of a Fianna Fáil Government would merely prove that a leopard does not change his spots, that an old dog never forgets to wag his tail, and that an old dog cannot be beaten off his track, that if Fianna Fáil came back, their first raid would be on the pockets of the people with the object of leaving the people less money to spend. The object of Fianna Fáil in diving its hand down deep into the trousers pocket of every taxpayer in the country is to make his loaf dearer, his tea and sugar dearer and his tobacco and beer dearer —if he drinks—and leave less money in his pocket to spend; in other words, to make life more difficult for him.

We had Deputy O'Malley quoting speeches made by the present Taoiseach and I asked him to quote—I am sure he had it—the undertaking given by the Taoiseach during the election campaign in connection with the food subsidies. Mr. de Valera, as he then was, addressed the public and his observations and remarks appeared in every newspaper. He said: "You know the record of Fianna Fáil in the past." What he meant by that, I do not know, but that is exactly what he said. He went on:—

"You know we have never done the things they said we would do. We do not want the price of bread, so important an article of diet for the poor, to be increased. We left on several million pounds as subsidy for bread."

Why was he not honest during the election campaign? Why was he not straight and sincere and frank with the electorate? Why did he not say: "All we want is to get into office and we do not give two thraneens after that, and when we do get in, we will give you dearer bread and dearer butter"?

When one compares the record of prices as a result of the Budget with the prices prevailing before it, we see that a few weeks ago a 10-stone bag of flour cost 40/–. It has now been increased to 72/– per sack. Why were the people not told that before the election? We see that the price of the loaf—and I agree with the Taoiseach's statement that the main item in the diet of the poor is bread—has gone up. That is his consideration, and that of his Party, for those who are bread eaters — deliberately without any reason or justification to increase the price of the loaf from 9d. to 1/1½, despite the fact—and this makes it more difficult for us to understand—that one can recall the headlines of the papers on the morning prior to the taking of office in 1954 of the inter-Party Government: "Price of Butter to be Reduced." I cannot understand the mentality of people who put out a Government that takes 5d. a lb. off butter and put in a Government that puts 7d. a lb. on butter. However, if that is the mentality of the electorate, as I said before, they do not deserve very much sympathy. They have asked for it and they have got it, and it is exactly as we told them it would be. The only thing we say is that if we were in office to-day the prices of bread, flour and butter would not be increased.

It is of importance to note that when the former Taoiseach, Deputy Costello, spoke here recently, as reported in last Wednesday's newspapers, he made it clear that the Budget was not concerned in any way with one penny piece of debt left behind by the inter-Party Government. They left a clean sheet after a very difficult year. Is there a Deputy who can deny that?

Dr. Ryan

There certainly is.

Mr. O. Flanagan

There is not a Deputy who could deny that——

Dr. Ryan

We certainly shall deny it.

Mr. O. Flanagan

——because after a difficult year not a penny piece of debt was left behind by the inter-Party Government. The Fianna Fáil Party have an old way of putting off their dirty work by throwing it on to somebody else, and the first speech delivered—and every other speech that will be delivered by every Fianna Fáil Deputy will be to the same effect —was to this effect: "We have to increase the prices of the bread and butter because the other Government left debts behind." That is an old story. That cock will not crow any more; he has crowed himself out now.

Every Fianna Fáil speaker in the general election campaign in the Mid-lands, particularly in Carlow and Kilkenny, said that the inter-Party Government was wrong in reducing the price of wheat and that when Fianna Fáil got back in office, they would see that nothing like that would ever happen again and that the farmers would get a proper price for their wheat. The Fianna Fáil Government was in office before the seeds of the wheat were put in the ground for this year's crop and yet the reply that came from the Minister for Agriculture was that it was too late to do anything about this year's crop. There was no question of increasing the price of wheat. If the Fianna Fáil Party is so sympathetic to the farming community, the growers of wheat, why do they not, now that they are in office with a bigger majority than any other Government ever had in this country before, show their sympathy for the farmers by increasing the price of wheat and not try to "wangle out of it" as they have done?

It is noteworthy that while the prices of bread and butter have increased, the levies have been removed from gramophones. You can have cheaper gramophones but you must pay more for bread and butter. In addition to that, they have removed the levies from umbrellas. Anyone who wants to purchase an umbrella may have an umbrella cheaper, at the expense of somebody who is paying more for butter and for bread and tobacco. No matter what part of the country one goes to, the indication of a rich and prosperous man's house is the television aerial.

Is it not more important to look after the needs of the poorer sections of the community than to provide the well-to-do people with cheap television? The same applies to private motor cars, radios and fur coats. Last but not least, we can have cheaper toilet paper because the levy was also removed from toilet paper. Our people do not live on gramophones, umbrellas, television sets, private cars, fur coats and toilet paper. Our people live on bread, butter and other foodstuffs.

I am sorry for the large section of the community living on home assistance, blind pensions, widows' pensions, teachers' pensions, Civil Service pensions, local government pensions and T.B. allowances. They will all pay more for food and the necessaries of life in order that the rich may enjoy cheaper radios, television sets and motor cars. But, again, if the Irish people want to see the well-off and the privileged classes with cheaper motor cars and television sets while they are prepared to sacrifice themselves to pay more for bread and butter, that is their business. Apparently, that is the position. Again may I say that if they sowed nettles for themselves they cannot expect roses to grow?

It was all very well throughout the election campaign to hear the speeches dealing with unemployment but we do not hear speeches dealing with unemployment from Fianna Fáil since they got into office. To-day I glanced through the Fianna Fáil supplement supplied with the Irish Press of Wednesday, October 15th, which bore the heading “Full Employment.” The Tánaiste and Minister for Industry and Commerce announced another of his plans, not in Leinster House but in Clery's Restauarant. All the promises seem to be made in Clery's Restaurant, if not in Jury's Hotel just as, when Fianna Fáil were last in office, all the plans for the farmers were announced in the Gresham Hotel.

In Clery's Restaurant there was a plan let loose, a few weeks before the elections, to provide 100,000 new jobs after five years, at the rate of 20,000 new jobs a year. I wonder when will that start because I am interested in this. The unemployed are also interested in it. In the course of the Budget statement we did not hear one word of the Clery's Restaurant plan for full employment. I am sure we will not be regarded as inquisitive when we ask about it. May I suggest that the Tánaiste should go to Clery's Restaurant again any night next week and let us know when he is putting his plan into operation, when we may expect the 20,000 jobs per year, where he will get the money for that and the nature of the work? Remember, it is 100,000 new jobs, not merely the filling of existing jobs. That is the plan he announced before the elections.

I am sure that when Deputy Lemass outlined the full employment programme there were many thousands of voters in the city who were gulled, who had the wool completely pulled over their eyes and sincerely believed that Deputy Lemass, as he then was, would provide 100,000 new jobs the moment there would be a change of Government and they said: "Maybe there is something in this. They fooled us before but they will not be so brazen as to try to do it again. We will renew our confidence in them and vote them back and perhaps they will be able to provide the 100,000 and 500,000 new jobs in the five-year term." I trust that when the Minister for Finance is replying he will refer to the Clery's Restaurant plan for full employment and will let us know when this plan will be put into operation.

From our experience of the Fianna Fáil Party, they were never short of plans. They always had plans and plenty of plans. After the change of Government in 1948 and again in 1954, the inter-Party Government pulled some of those plans from the shelves of various offices, such as the Office of Public Works and elsewhere, shook the dust from them and scraped off the cobwebs that had accumulated in the years they had been lying there. Fianna Fáil were always a great Party for having plans but never seemed to put any of the plans into operation.

The Clery's Restaurant full employment plan is to-night as dead as mutton. It has served its purpose, helped to gull the voters and helped to sway the floating vote in the City of Dublin which would contribute a good deal to a change of Government. Again we see that through deceit, through false statements, through false propaganda, the change of Government has come about. No effort is being made to provide work but greater hardships and greater suffering are being inflicted on the people. When the Taoiseach was speaking at Booterstown, as reported in the Sunday Independent of the 12th May, 1957, there was not a word spoken about unemployment or the food subsidies. The only advice he could give the people was not to eat seed potatoes, having a day or two before that announced that if an Irishman wanted to play a good game, it should be Rugby football.

An Leas-Cheann Comhairle

That has no relevance to the Resolution before the House.

Mr. O. Flanagan

I respectfully suggest that the head of this Government should interest himself in the food subsidies, in the cost of living and in the provision of work rather than to offer advice on any particular form of foreign sport.

An Leas-Cheann Comhairle

The question of sport does not arise on the Budget.

Mr. O. Flanagan

The only consolation that could come from his lips after such a severe imposition on the people was to tell them not to eat seed potatoes; seed potatoes were not good for them; they should not eat them and there was no headline in the Sunday Press of 12th May other than one advising the people not to eat seed potatoes. The people cannot now buy flour, butter or bread. Every family in the State will have to cut down on their eating. Then we are expected to put up a fight against T.B. and our younger people are advised by the medical profession and others that they should be better fed, reared in a healthier atmosphere, well nourished, well cared for.

I feel that the home assistance recipients—and every local authority in the country has quite a large number of home assistance recipients on its books—will get no increase what-ever from the local authority. That is despite the fact that the local authorities will be obliged to increase rates because the various hospitals, the mental hospitals, the fever hospitals and the county hospitals, will be obliged to present bigger bills for their foodstuffs. I feel that it was a wrong move in this Budget to increase hospital charges, because again this is an attempt to join in the war waged against the poor. There are working class people, agricultural labourers, forestry workers, road workers and mill workers who enjoyed free hospital treatment before the present Health Act became law. The majority of them no longer enjoy free hospital treatment. A charge was imposed on them by the Health Acts and here again we see in this Budget that hospital charges per day are to be vastly increased. The rates will now be vastly increased on working class people who had free treatment some time ago.

It has been suggested, and I want this again on the records, that, as an alternative to balancing this Budget, the Minister for Finance might consider abolishing the agricultural grants. I want to make it clear that any attempt by the present Government to abolish that grant will increase the hardships on every rate-payer in the country and will be vigorously and bitterly opposed by those of us on this side of the House. I understand it is at present under consideration by the Government. If that serious step were taken, the rates on every holding in the country, from the smallest and poorest waterlogged holding to the mightiest and most prosperous holding in the rich lands of Meath, will be vastly increased.

I advise the Government, for what the advice is worth, not to interfere with that grant, but to let the agricultural community and the ratepaying community enjoy the privileges they are enjoying—and it is little enough they do enjoy. I advise the Minister for Finance and every other member of the Government to keep their hands off the agricultural grant. Any attempt to have it removed will meet with the bitterest and sternest opposition that the farmers and ratepayers can put up against the Government. I trust that the necessary steps will be taken to see that this course of action, in regard to the abolition of this grant, is not proceeded with.

I should like the Minister for Finance to make reference to the question of the wages of workers when he is replying, because, if my information is correct, the Minister for Industry and Commerce, has, within the past ten days, given instructions to a senior officer of his Department to make inquiries with regard to the drafting of legislation for a permanent wages standstill. If that is so, the people should be told now. Can there be anything more severe on working-class people than deliberately to increase the price of foodstuffs and make no effort to provide work for them, and, in order to muzzle trade unions and render powerless their strength and membership, to endeavour to bring in a Bill, as the present Government tried before, to peg down the wages of workers and not allow them to seek to right the position in order to meet the rise in the cost of living? I hope either the Minister for Industry and Commerce or the Minister for Finance will make reference to that. I feel that the workers will not stand for a Wages Standstill Order. No matter how strenuously the Government may try to bulldoze such an Order into existence and compel the workers to obey it I feel that every single worker will resist it, as every worker should resist the attempt of any Government to peg down wages and keep them down, while that reckless and careless Government allows the cost of living to be vastly increased.

The same applies to recipients of T.B. allowances and the many other pensioners in the State who are receiving no benefits whatever to compensate for these increased charges.

I feel that the Government is making a serious mistake in winding up the Irish News Agency. I believe it is a wrong step. It should be examined more closely rather than have the country at the mercy of the foreign Press. It is rather late to ask the Government to reconsider the matter now. I believe it was a mistake and one which the Government will realise in the years ahead.

This Budget may be looked upon as a Budget which blisters every section of the community. It is an unpopular Budget, an unwelcome Budget and, as has been pointed out, an unnecessary Budget. I hope it will be a lesson— although a very expensive lesson—to the voters of this country. I hope the people now realise the very great mistake they made. I am sure the majority of them do. I notice that, since the Budget and its new taxes were announced, the speeches from Fianna Fáil Deputies have become fewer and fewer.

There will be far reaching and disastrous effects from this Budget. I can see the small country bakeries closing down; I can see the bakers added to the list of unemployed; I can see business slowing up; I can see the brewing industry affected; I can see less business in licensed premises. This is because there will be a lesser amount of money to spend in people's pockets. One of the most disastrous blows struck in this country for a long time has been struck by the present Minister for Finance in this unpopular and disastrous Budget. It has been put to this House without one iota apology.

Remember the election posters: "Only a Team can do it." They leave the question mark there. If the imposition of such hardships on the people is the work of a team, I can only say that the people at this late stage can compare the record of the inter-Party Government. The inter-Party Government kept down prices. They did not allow prices to be increased one iota, without first having a full inquiry by the Prices Advisory Body, who had to submit a full report to the Minister for Industry and Commerce. The principal concern of the inter-Party Government was to keep down prices, particularly of essential foodstuffs. It is our principal concern to-day.

There is the difference between ourselves and Fianna Fáil. They believe in vastly and recklessly increasing the prices of essential foodstuffs, while reducing considerably the cost of luxury goods for the wealthy. I trust that, in the short space of a few months, the people, particularly the working class people, now see the mistake that was made. If this is the first instalment of Fianna Fáil policy for the next five years, I feel it is a policy that will undo considerably the work done by the inter-Party Government. They need never be ashamed of that work; they can be proud of it. As far as our record in relation to foodstuffs is concerned, despite the international situation, no Government in Europe controlled the price of essential foodstuffs with better result than the inter-Party Government.

It is well known that the changes now taking place are not changes for the better. I have considerable feeling for the members of Fianna Fáil behind the Minister for Finance who must defend this Budget. I sympathise with them. It will be a difficult job to do at the church gates; it will be a difficult job to do in the parish halls; it will be a difficult job to do with the unemployed, who were expecting a full employment programme and who are still expecting it.

I do not propose to comment further on this Budget beyond saying it is a black Budget, a disastrous one and a bad one, one as a result of which grave hardships and unnecessary distress will be inflicted upon the poorer sections of our people, a Budget which would not have left its mark on this country if the inter-Party Government had been returned at the last general election, because our concern has always been for the poorer sections, particularly in regard to keeping down prices of essential foodstuffs. I oppose these increases and say again that the Budget is a severe blow to every section of our people but, to those who were tearing up the pavement stones to get votes for Fianna Fáil, all I will say is it is too good for them. They asked for it and they are getting it.

The people would prefer to see us in office. They know that we shall try to solve the problem with which we are faced. The people know that the first thing we must do is to clean up the mess that was left to us. Numerous people had to leave this country in 1954, people who up to then had been engaged in gainful employment. Those people were glad to see the return of this Government because they knew we would endeavour to stop the economic rot. Political freedom is very little use if a high standard of living does not accompany it. There must be economic freedom. That is what we are attempting to achieve. The road may be hard for a little while but by the time the next general election comes around mass unemployment, mass emigration, will not be there.

Any intelligent voter knew well enough where the country was going and that it could not carry on as it had been during the past three or four years. We were told they kept down the cost of living. They did; but they sent many thousands of boys and girls to the emigrant ship and anyone who had not the passage money was left on the dole. In any place where money could be found to subsidise and bolster up that inter-Party Government during those years, they found it. The National Loans had failed; everything had failed and we were the laughing stock of other countries, as we could not manage our own affairs and keep going.

Then the present Minister for Finance came in here with this Budget. He introduced an honest-to-God one. He is faced with a shocking problem and, in face of that problem, he is asking the people of Ireland to accept the Budget in good faith from the national and economic point of view, to give this country a chance of coming back to prosperity again, to lift up the country from where it had fallen, to try to improve the economic life of the nation, to bring back production and prosperity in every phase of our national economic life. That is what we are trying to do. I can assure you we cannot do it in two, three or four months.

I have a great deal of sympathy for the last speaker, for he is not the only misguided Deputy on the other side of the House who has accepted the arguments of his Minister that this Budget is the first step in a long term programme for the expansion of our economy. We must increase production; we must balance the Budget; we must balance our international payments; we have to coax the farmers and stimulate industries— these are all common ground which we all accept.

The programme which the Minister has put before us to achieve those goals has, to my mind, one very striking characteristic—it sets a completely false scale of priorities. It has a completely unbalanced sense of proportion. The first step which is being taken to achieve these desirable economic objectives is to strike a body blow at the weakest section of the community, the old age pensioners, the unemployed. I wonder if the Minister has any conception as to how an old age pensioner is to survive this Budget on the miserable insult of the increase which has been given—a shilling a week, less than a penny three farthings per day.

We were told that, according to the nutritional survey, it has been estimated that a shilling is enough to recompense those unfortunate people for this increase. That is said, despite the fact that everyone knows that bread and butter—sometimes butter, but more usually "bread and scrape"—is the staple diet of those unfortunate people. Has the Minister any conception of how they live? If he has not, will he invite some of his Dublin colleagues to bring him down to Summer-hill, Gardiner Street or some of our Dublin tenements, where we have 16,000 old age pensioners trying to eke out a miserable existence on a pension of 24/– a week, now increased to 25/–. How are they to do it?

This Budget shows callous indifference to the fate of those people. However little the Minister knows about the unemployed and the pensioners in the City of Dublin, certainly he has plenty of colleagues who, I am sorry to say, I think are guilty of the grossest dereliction of their duty to their constituents in permitting him to introduce these proposals.

This Budget has a far graver impact on the people of Dublin, on urban dwellers generally, than it has on the people, say, in the Minister's own constituency of Wexford. However badly off they are, a great many country people always have a few drills of potatoes or a few heads of cabbage in their back gardens. They are not dependent, as our people in the cities are, on the loaf of bread from the shop at the corner and the half pound of margarine.

In that connection, it may be of interest to point out that the Capital Investment Committee, of which we have heard so much, made three recommendations to the last Government. I think it was the Minister for Defence who said here as a justification for this Budget: "We have been told to abolish these subsidies We have been told to do this and we have been told to do that by the Capital Investment Committee." Whatever else has been done, certainly the recommendations of the Capital Investment Committee have not been implemented in these proposals.

I do not know whether the Capital Investment Committee set any priorities in their recommendations but it is significant that the first of their recommendations was the abolition of the agricultural grant. That has not been implemented. I am not saying it should be implemented. I am inviting the Minister to tell us in replying to this debate what his intentions are in regard to that matter. The recommendations were joint and several ones, as Deputy Costello pointed out here last week. The agricultural grant was to be abolished and the moneys formerly applied to it were to be diverted to a scheme for the subsidisation of fertilisers so as to relate the grant more directly to increased agricultural production. That has not been done.

As regards the food subsidies, the money formerly used for that purpose was to be diverted to the capital programme. I do not think that has been done either. Therefore, it is rather futile for Deputies from the other side to wash their hands of responsibility for these proposals by saying: "That is what the Capital Investment Committee told us to do. It is not our fault; blame them."

The organised workers, trade unionists, will, no doubt, in the course of a few months, cushion themselves from the impact of this Budget. We will have a further round of wage increases, perhaps 7/6 to 10/–, which will have the effect of destroying whatever stability there has been in our price structure heretofore. However, there is one class of persons who will not be able to cushion themselves from this increase, that is the unorganised worker, the middle class worker or white collar worker a section of the community who have to strive more than any other to make ends meet, for whom there are few social services, an independent group of people for whom it is desirable, for social and economic reasons, to provide every encouragement.

This section of the community, wage and salary earners, in particular those who pay income-tax under Schedule E, are contributing a completely disproportionate share of the national revenue. This is the section whose employers return their wages to the Revenue Commissioners, who are taxed in full for every 20/– of their £. They are contributing, it is well for Deputies to know, 27 per cent. of the total income-tax revenue, which is far more than their just share, which is far more than is being contributed by Schedule E taxpayers in other countries in Europe.

The Minister has been enabled to provide certain concessions in this Budget. That is why I say he has shown a completely distorted scale of priorities, an extraordinary sense of proportion. I am well aware it is desirable to rehabilitate industry, to provide tax concessions for increased production. We have increased the wear and tear allowance, which will cost £400,000 in the next tax year. Grave and all as the position of industry is—I am well aware of the tax disabilities under which industrialists labour—I suggest that it shows a completely false sense of values to provide that concession, and to provide £250,000 for agricultural marketing, and £250,000 for an alleged commitment to the master bakers which the last Minister for Industry and Commerce has shown did not exist, while at the same time delivering such a body blow to the old age pensioners, the unfortunates trying to eke out a miserable existence on 25/– a week.

In regard to the increased wear and tear allowance, which is for the purpose of assisting industrialists to finance the purchase of capital equipment, I suggest to the Minister that that purpose would be better served by introducing an investment allowance, an initial allowance on the lines of that made available in last year's Finance Bill for industrial buildings. This wear and tear allowance is granted to far more than industrialists. This increase will not be directly related to the provision of new capital equipment in industry. It is available to people engaging in the retail trade. It is available to the shopkeeper on his cash register and on his refrigerator. There is no particular purpose served by encouraging increased expenditure on such items.

On the problem of tax reform and, in particular, tax concessions for industry, I have no doubt whatever that the Minister, during his term of office, will be subjected to considerable pressure from vested interests of all sorts clamouring for concessions. His colleague, the Minister for Industry and Commerce, will probably press him very hard to make further concessions to industry next year and the following year.

The Minister, in his Budget statement, stated that he was prepared to consider tax reform, notwithstanding the fact that there is a commission considering taxation at the moment. I think that is desirable, that the Minister should express such a willingness not to have himself tied down by reason of the fact that this commission is sitting. At the same time, I would urge that he must not set about tax reform on a patchwork and piecemeal basis; that he must set for himself some scale of priority as to what sections of the taxpayers are most deserving of concessions.

There has been recently in Britain a development which is not without relevance for us here. They had a Royal Commission which produced two reports on taxation. They made dozens of recommendations on taxation which so far have not been implemented. Recently, the British Chancellor invited the Institute of Chartered Accountants in England to submit to him a scale of priority on which those recommendations should be implemented. I think it is very significant that the first reform which that institute recommended, an institute biassed, if anything, very probably on the side of industry, was relief for salary earners taxed with income-tax under Schedule E. As I said, the Minister must be very wary of making further concessions to industry because the effect of those increased concessions is to increase the burden on those taxed under other headings and those taxed by indirect means also.

We have in this Budget an increase in the charges payable under the Health Act, an increase from 6/– a day to 10/– a day. The Minister is saving by this means £90,000 and he has stated that a similar saving will accrue to local authorities. I am very sceptical if any increase will accrue to the health authority in Dublin which is not able to collect the 6/– a day from hospital patients. It would have been far better if the Minister had achieved his economy on the health services by tightening up the administration. Everybody agrees that the Health Act calls for considerable reform and its administration is one aspect which could be tightened up.

In his Budget statement, the Minister drew attention to the fact that diminishing returns have now begun to set in in many of our duties. He commented upon the lack of buoyancy in the revenue. I think it is important to note that in the last financial year the yield of duties from beer fell somewhat short of the Minister's estimate. I think they fell short by something over £100,000. By increasing the beer duty by 1d. per pint, the Minister hopes to get £620,000 in the current financial year. I am tempted to ask whether there is a danger here of killing the goose that lays the golden egg.

It is well to draw the Minister's attention to the fact that in the last year's trading many of the small establishments underwent a period of considerable difficulty. I notice that the increased beer duty allows a small margin for the trade. I do not think anyone will find any complaint with that aspect of the Minister's proposal and certainly the trade is entitled to it. They are allowed a very small margin which has to be apportioned between the brewers and retail supliers of beer. It is desirable to try to restore the buoyancy of the revenue under this head, to stimulate the trade in this respect.

I am tempted to ask, therefore, whether or not the Minister has attempted to consider abolishing the price control on beer in Dublin City and other centres. It was introduced as a wartime measure. This is not a socialist economy and it is hard to see why there should be continuing price control. I believe that the abolition of price control would probably bring about a drop in the retail price of beer in certain types of houses, family-run houses, where the overheads are not as heavy as in other bigger houses. Undoubtedly, we would see, at the same time, an increase in the price in the larger houses.

There is a small point, but, in so far as it indicates an undesirable trend in regard to the beer duty in particular, in regard to the falling rate of return from the duty, I want to point out to the Minister a practice which has developed in the more expensive Dublin hotels where it is very difficult, indeed sometimes impossible, to obtain a bottle of Irish beer or stout. I do not know what form of ignorant imbecility this is on the part of our hotel keepers. I do not know what impression it makes on the foreign tourist. When they visit a country, tourists like to find what they call the wine of the country. The wine of our country is Irish brewed stout. It is impossible to get it in the bars of some better class hotels and it must make a bad impression on our visiting tourists. At the same time, we find Scandinavian and other continental beers, synthetic bilge-water, freely available at fancy prices. I feel that a word from the responsible Minister might bring about a rectification of that undesirable trend.

The Budget proposals have been submitted to us as part of long-term programme. I remarked on the paradox that the first step should be to deliver a body blow to the weakest section of our community. With relation to these long-term plans it is desirable to remind Deputies on the other side of the House of the dictum of a very famous economist: in the long run we are all dead. Certainly the lives of many of our old age pensioners will not be extended by the provisions of this Budget.

It is interesting to note the effect of similar reactionary proposals brought in by the Fianna Fail Government on a previous occasion. Deputy N Lemass, speaking here to-day, produced certain selected figures in an effort to prove to us that, as a result of the infamous and notorious 1952 Budget, employment expanded. That, of course, was not the case for only to-day the Minister for Social Welfare produced certain employment figures in reply to a question tabled by Deputy O'Sullivan. It is desirable that these figures should be put on record again now in refutation of Deputy Noel Lemass's peculiar logic.

In the March quarter of 1952 the number of registered unemployed persons increased on the corresponding period in the previous year by 9,777. In the June quarter the number of persons registered increased by 8,748. In the September quarter the increase on the previous year was 6,700. In the following year, 1953, the increase was even greater. The increase in the March quarter was 25,971. The increase in the June quarter was 26,464. This Budget has been produced in a rush and that, in my opinion, seems to be the only excuse one can make for the Minister, who has, I submit, been guilty of callous indifference in producing these ill-conceived proposals at this particular time.

Mr. Coburn

Deputy Burke was at great pains to condemn the last Government for the alleged financial state of the country. He said that money is scarce for the various services, such as house-building and advances under the Small Dwellings Act. He blamed the last Government for the large number of unemployed. At least one thing has resulted from the previous Government's efforts and that is the fact that no debt was left after its period in office.

In addition, the adverse trade balance has been very considerably reduced as a result of the efforts of the last Minister for Finance, Deputy Sweetman. One of the measures which he introduced, and which received the commendation of every Party, was the imposition of the special import levies.

They yielded something in the region of £4,500,000 last year.

Deputy Burke also claimed that his Party had the interests of Ireland at heart thereby insinuating that his Party, or he himself at any rate, had a monopoly in having the interests of Ireland at heart. I should like to remind Deputy Burke that we are all Irishmen and we are all doing our best. Indeed, if there was a greater degree of co-operation in the past we might not have so many pressing problems besetting us at the present time.

He criticised the agitation in the ranks of the unemployed. He stated that his Government could not wave a magic wand to provide millions of pounds to give employment. He should ask the Minister for Industry and Commerce where is the £100,000,000 which he was going to provide when he got back to office in order to solve the unemployment problem?

It is true to say that this Budget was received throughout the country, specially by the ordinary working classes, with consternation. It embodies the complete withdrawal of the food subsidies. These food subsidies were introduced in 1947 as a temporary measure and it was not contemplated by anyone on this side of the House that they would continue interminably. But these subsidies had become an integral part of our economy. I consider that it was morally unjustifiable, and other speakers have referred to this matter also, for the Government to abolish these subsidies in one fell swoop.

The subsidies were introduced to keep down the prices of essential foodstuffs. Had their abolition taken a gradual form less harm and less hardship would result. I cannot understand why bread should be hammered. The price of the 2 lb. loaf has been increased by 4d. or, in some cases, by 4½d. That is a very pointed increase in relation to the lower income group where there are very often large families to cater for. The removal of the subsidy on bread will mean an increase for these large families of some 7/– or 8/– per week for bread alone, to say nothing of butter. It is an astonishing fact that the Government did not advert to that before they brought in this proposal. They have given certain compensatory benefits and these benefits will be welcome but they are only a drop in the ocean when one considers the injury done by the total abolition of food subsidies.

Much play has been made with the special import levies. One of the first things the present Government did when they returned to office was to remove certain levies on certain imported goods. These levies, as I said, were imposed by the former Minister for Finance, Deputy Sweetman, in an effort, and a successful effort at that, to curb the adverse trading balance trend. Now we find the present Government undoing, in part, that good work. They have removed levies amounting to approximately £1,750,000 on certain non-essential imported goods. It would have suited the Government better if they had kept on those levies and applied the £1,750,000 towards the retention of some of these subsidies—at least towards the retention of a subsidy for bread. I think that would have been a good day's work and a step for which the Government would have received credit.

Certain new taxes have been imposed. No Budget is brought in here but there are new taxes imposed. I suppose that is inevitable. Tobacco has come under the hammer again. It is only natural that this commodity should be the butt of every Government. It is an easy way of collecting money. The funny thing about putting a tax on tobacco and cigarettes is that no matter how dear they are the revenue seems to come in from them all the time. That is one of the reasons that Governments turn in that direction. The Government expects to get £1,000,000 in taxes from this source. Cigarettes and tobacco are not essential, I admit, but we must remember that their manufacture has a very high employment content and you may go too far some year and, as Deputy Byrne said, kill the goose that lays the golden eggs. There is a margin for the trade. I suppose that is for the manufacturers and retailers alike as some compensation for increased production costs and also as a compensation for the possible loss of custom in case consumption goes down.

The Minister made reference to agriculture and stressed the importance, and rightly so, of increasing agricultural production. He referred to the amount of money which he allocated for the eradication of bovine T.B. I forget what the actual amount of money was. Everybody in this House and throughout the country, who takes a real interest in this terrible scourge, knows that England and Scotland will very soon be completely free from this disease. Every effort that this country can make to eradicate the disease from this country should be encouraged if we are to preserve the very good market which we have at the present time for our cattle exports, which are our main industry.

I am glad to see that the Minister allocated a sum of money for the improvement of our existing market arrangements. That is very important, especially in the competitive age in which we live. Deputy Byrne referred to the tax rebates granted by the Minister when he referred to the wear and tear allowance on machinery for industrialists. It amounts to 25 per cent. I presume this is the result of a recommendation made by the recently appointed Industrial Taxation Committee set up by the inter-Party Government. It made many good recommendations. We all agree that there is a great fillip and impetus needed for industrial production especially at the present time when we have so many unemployed and when we can envisage the impact of the Free Trade Area on this country.

If our industrial production is not geared to its fullest extent, how can we hope to compete with other countries if we enter this Free Trade Area and it appears that we have no alternative? The Minister gave reliefs with regard to taxes on exports. He gave 100 per cent. relief in that regard. That is a good measure and it should help many industrial firms to step up production because they will be able to plough back into their concerns the money which heretofore they had to pay in taxes. There is one fault that I see in that recommendation. The Minister said that the relief in regard to the wear and tear allowance and the 100 per cent. relief in regard to profits from increased exports would not apply this year. I think that is a pity. I do not know the reason for it. He did not give the reason. It may be an administrative one. I cannot say but in view of the impending setting up of the Free Trade Area, I thought it was a pity that these concessions could not be given this year. This is the year that will count, when industry should be properly prepared if industrialists are to go into the Free Trade Area.

The Minister referred to certain economies he intended to make. That has been the cry up and down the country for a number of years from all quarters, and any Minister who comes in here and states that he intends to make economies in the various Departments deserves the credit of the whole House. With regard to the health services upon which approximately £9,000,000 was spent last year and upon which over £8,000,000 will be spent this year he expects to save £90,000. I might mention in passing that this Health Act since its inauguration has been very unsatisfactory due to the very complex system involved. The trouble seems to be that in each county the various managers have, it appears, different ways of interpreting the Act. I do not suppose I am in order in referring to that but I just wanted to make the point.

The Minister referred to the Civil Service and also to the fact that there are in this small country 32,000 civil servants costing £17,000,000 for salaries alone. He hopes to save £250,000. I hope that his efforts in that respect will meet with success because that is an enormous number to have in the Twenty-Six Counties. I hope that eventually he will succeed and at the same time not interfere, if at all possible, with the existing staffs. I do not suggest that that is his intention. He will probably be able to make some economies by reducing the rate of recruitment and allow an easing off by retirements. In the Defence Department he expects to save £100,000 and in the Land Commission £80,000. They are other good points which are to be recommended.

I notice he made reference to the abolition of the Irish News Agency. Since that concern was set up some years ago, it has gone from bad to worse. It has been criticised from the very start. It loses money hand over fist every year. I do not know a lot about the matter but I remember reading one criticism of it at one stage by a learned man and it struck me very forcibly that the News Agency during its term of office, dealt a very devastating blow to established newspapers, was cutting across their interests and doing them great harm. I do not think the country has lost a terrible lot by the abolition of the News Agency.

As I said earlier, social assistance reliefs have been given amounting to 1/– to old age pensions, widows' pensions and recipients of unemployment assistance. These reliefs, while they are welcome, are but a drop in the ocean compared with the increased money large families will have to spend on paying the increased prices for bread and butter, amounting in some instances to 7/– and 8/–.

I notice the Minister did not make any reference to income-tax in his statement. The recent Minister for Finance, Deputy Sweetman, set up a committee to inquire into the incidence of the tax and asked them to try to devise a method of abolishing this tax, whilst at the same time finding, more or less, the same revenue for the State by other means. The Minister should try to expedite the work of this committee and not put it on the long finger. I also suggest that, when he has time, he should examine the possibility of applying the P.A.Y.E. system in every branch of our manufacturing concerns. The system seems to be working very well elsewhere. It is optional in some cases in this country at present. Some workers, if they so wish, may adopt the system. I believe that if the Minister urged the remainder of the firms to adopt the system benefits would result.

Many problems confront this Government, just as many problems confronted the previous Government. One sure way of making money to run the country's services is to attach more importance to one of our greatest money-spinners—tourism. The Minister did not make much reference to it, if any. I believe that money spent on tourism is a good investment. Every year, we take in about £33,000,000 or £34,000,000. That sum of money would go a long way towards helping to balance our external trade. Last year a sum of £400,000 was devoted to the furtherance of tourism and I hope the same amount will be provided for the purpose this year. A question was asked here last week in regard to the 2/– service charge imposed on motorists travelling across the frontier posts after 9 p.m.

An Leas-Cheann Comhairle

That would be more a matter for the Estimate than for a Budget debate.

Mr. Coburn

With the permission of the Chair, I should like to make just one observation. The Minister gave his reasons for refusing that request. I suggest he might consider relaxing that service charge for the summer months at least, because it would ease the situation greatly as regards the encouragement of tourism.

This Budget, while showing the best efforts of the Government to solve the problem which faces them, will not be received with much warmth throughout the country. I cannot but wonder whether, if those persons now constituting the Government had told the people during the recent general election campaign that they intended to raise the price of bread, butter and flour, they would now be sitting on the Government Benches and we would be sitting over here on the Opposition Benches.

Mr. Carew

I feel it is my duty to make my little contribution to this very important debate affecting the lives of all the citizens of State. It is important every year when Budget time comes around to examine the effect the Budget has on the everyday life of the people. One must sympathise with any Government bringing in a Budget and particularly with a Government bringing in an unpopular one.

The Government has introduced a severe Budget which will create very great hardship for all sections of the community. By the withdrawal of the subsidies, there has been an increase in the price of the very necessaries of life—bread, butter and flour—not to mention tea, which is imported and over which the Government has no control, and sugar. Anybody who understands the life of the working-class people—and particularly the unemployed people—and we who live in cities are very close to their everyday life—knows that a working-man living on £3 1s. dole, plus children's allowances, cannot afford anything in the luxury line and that it puts him to the pin of his collar to buy the very necessaries of life which, as I have said, are bread, butter, flour, tea, sugar, milk, potatoes, eggs and vegetables. The House will notice that meat is not mentioned. That is the food of the working-class man.

I do not want to be an alarmist of any kind but this is a severe Budget and it will create hardships. I say, not in any hostile manner, that the Government should not have withdrawn the subsidies. No doubt the last Government could have done the same thing. Perhaps they could have had greater ease in government if they had raised their revenue in that way. Anyhow, I feel it is not a question of putting one Government against another and of what they do and what they do not do. Our first duty is to look after the weaker sections of our community. Unfortunately, for various causes, we had a very bad year in 1956. There are factors outside this country over which we have no control but which affect our economy. Last year, the balance of payments simply went haywire, largely due to the fact that the goods we had to import advanced rather steeply in price, while the goods we exported reduced in price.

Cattle prices fell last year—largely due to the fact that the Argentine Government placed large quantities of meat on the British market, thereby depressing our cattle prices on which we were dependent for the revenue to buy the things we needed. That was a very big factor in the Government of last year and any Government facing that situation faced a major issue. Furthermore, war threatened in Egypt. The Suez Canal hold-up severely affected our petrol supplies and the revenue that would have been available had petrol been in full supply, rather than rationed for a period, was lost to the Government of last year. In addition, the price of petrol increased. On top of that, we had the credit squeeze, as it is called, and we know how severe that restriction was in the case of various industries and business people, and even individuals who were, perhaps, half-way through the process of erecting a house. We know how that credit restriction curtailed operations and imposed a very severe hardship on those people. A Government which had to face all that was certainly worthy of consideration from the people. Instead of that—and I regret to say it—certain people came in here agitating, and demanding that more money be given for housing.

In Limerick City, which I have had the honour to represent, we had no money problems because our housing schemes were always financed through the Local Loans Fund. We did not have to go to the public for funds, but evidently Dublin and Cork and other places had to raise money by loan. Briefly, the position was that in Dublin the corporation failed to get the loan from the public, and the Government of the day had to come to the rescue to supply housing needs. Doing that caused a severe strain on the amount of money the Government had for capital investment. As a result, grave unemployment was caused all over the country because there was not sufficient money available and when the Government tried to float loans, they were not able to get the full amount. The corporation in Dublin failed to get a loan from the public and the Government had to take over. That put the Government in a very serious position, and for that reason, I feel they did not get the support they should have got from certain members of this House in such a situation.

I know it is the practice here that the Government has to answer the questions, and when you are out of the Government, you ask the questions. Then you usually ask awkward questions and, perhaps, unfair questions at times. These questions are usually asked to embarrass the Government. I hold that is not as it should be, because we in our local authorities have a duty and a function to look after the needs of our people. That is why they send us up here. If we come here, I think we should at least be fair to whatever Government is in office, and if there are any reasons why money is not available and if there are economic factors such as those which hit the inter-Party Government last year, I do not think political capital should be made out of them. Rather should we be more patriotic and not seek to convey to the people who are looking for money to build houses the impression that it is the fault of the particular Minister or Government in power that they cannot get all the money they need.

I have frequently heard trade balances being discussed here, and while I do not want to go back over these things, it seems to be always a question of whether it is an adverse balance or a credit trade balance. The position is this: if an adverse trade balance is brought about, there is always some reason for it. We know— and I have heard it said here very often—that we had an adverse trade balance of £62,000,000 in 1951. That is true. But we know that prior to 1951, we had the threat of the Korean War and nobody knew at that time what would happen. It was the duty of the Government then—and the Government did live up to its responsibilities—to encourage merchants all over the country, factories, ware-housemen and others, to lay in stocks of goods that would be in short supply if a major war had taken place.

All those people who were so concerned knew well from their experience of the previous war between 1939 and 1946 what the situation would be if war had occurred, and as a result large stocks were brought into the country. The banks, to give them their due, did not restrict credit and allowed the firms to bring in the supplies they wanted. If we had an adverse trade balance in 1951, we had these goods that were needed and the necessary raw materials for our factories. That, to my mind, was a matter of good housekeeping on the part of the Government on behalf of the people, the industrialists and others who were concerned with having those supplies, should a major war occur.

As we all know, when war breaks out, certain goods are not obtainable, and had we been caught in that position, no doubt there would have been large-scale unemployment. One can guard, to some extent, as far as the resources of the country will allow, against adverse effects of war, but we had another type of adverse trade last year which was very different. It was brought about by the fact that goods that could be classed as luxuries were bought by the people. Goods were brought into this country which would not be in the country were it not for hire purchase. We know that the luxury goods brought in here for the past few years were of such a type that many of the homes that enjoyed them would not have had them in normal times, if they had to pay for them.

To my mind, that situation was brought about largely through housing activities throughout the country. Whenever a new house was built in many cases, instead of doing things in the easy way of putting in furniture and other things as time went on and as the people could afford it, a fellow arrived at the new house and said you could have all you wanted, at so much. It was only a shilling for this and two shillings for that and people thought they were going to furnish a house for a matter of shillings; but every week he came, he brought a new gadget, with the result that he was adding to the bill all the time. Many people got in large quantities of goods in that way and, to my mind, their purchases should have been spread over a longer period. That brought about the purchase of goods that, although in some cases they might be necessary, were goods for which people could not afford to pay. It is always said that anything for which you cannot afford to pay is a very dear article.

That situation had developed last year to such an extent that the Government had to take action and I was glad that from all sides of the House it was said that the Government, if anything, did not act in time. That was a reasonable attitude to adopt. It was only correct that the purchase of luxury goods for which we could not afford to pay because of the fact that our trade had been considerably reduced as a result of the factors I have mentioned, should be reduced. There was a loss of at least £12,000,000 to £15,000,000 last year between the cattle and the turkey trade, not to mention many other lines.

The Government acted wisely in imposing the levies. If somebody says that they should have introduced them sooner, I say perhaps they should. The levies caused hardship in some businesses. They dislocated business and caused unemployment but, if they did, it must be remembered that the levies were not imposed on any Irish commodity. We are all very fond of talking about the Irish language and speaking the Irish language. The levies were imposed, not only on English commodities, but on commodities from other countries that never bought twopence worth from us. That factor should be borne in mind.

One matter that should be put before the House annually is our adverse trade balance with countries all over the world. The Government should not encourage trade with a country that is not prepared to trade with us. It is coming to that, or to something like it now, because some countries are beginning to realise that they must trade with their neighbour and that they must have some arrangement whereby they can get the goods they want at reasonable prices and perhaps in the years to come there may be a development in that direction.

In my opinion, the Budget will cause a very severe strain on many sections of the community, particularly on the poorer sections. One can picture in any city, town or village a poor man with a family and what the Budget will mean to him. He will pay more for bread, butter and flour—the three main items. In many homes there is no bread bought; the woman of the house bakes the bread, feeling that she can do better with a four-stone sack of flour and baking the bread herself than by buying bread. It is all the more credit to her that she exercises all the economy she can in her home.

I understand that the four stone sack of flour now costs 28/–. It cost 17/6 prior to the Budget. That woman has to find an extra 10/6 to buy the flour, not to mention all that the butter will cost her or the tea, sugar and other things that she wants. There is no luxury mentioned in this. I would much prefer to see extra taxation imposed on luxury goods and less on the staple food of our people.

It our duty so to arrange matters that the burden of a Budget will fall lightly on the weakest sections. If the Government had to reduce some of the subsidies, one would not grumble so much but it was too severe to abolish the subsidies altogether. The Government acted unwisely in doing so.

People may say to me, as they do, that we are all responsible for it. I know that the Government are responsible for it and that they have to take the responsibility. While we are here as an Opposition it is our duty to point out the effects of the Budget on the people that we represent and people down the country will express their grievances very quickly. It is only right that we should tell the responsible Minister what the effects of his Budget are. In any criticism that I make I am not making political capital out of it. There are five years of office for the present Government and they have acted rather severely in this Budget.

Another matter that concerns my constituency very much is the price of milk. The price of milk has been a thorny problem in Limerick for a number of years.

An Leas-Cheann Comhairle

The Deputy may not argue the price of milk on this Resolution.

Mr. Carew

I do so because it has a bearing on the price of butter. We all know that, if the price of milk is increased, the price of butter must be increased. The last Government reduced the price of butter, which was 4/2 a lb., to 3/9. It cost £2,000,000 of the taxpayers' money to do so but it had two very important effects on the lives of the people. One was that it gave the people butter at 5d. a lb. less than it was at the time. Secondly, it was an indirect subsidy to the farming community because the higher you put the price of butter the more you increase the price of margarine. We would be all very sorry indeed to see anything happening in this country that would interfere with butter production, which is an important item in our economy.

It is regrettable that at the present time we cannot find a profitable market for the surplus butter we have now for export. The taxpayers are paying something like 1/8 a lb. to export butter to foreign countries. That is regrettable. I do not want to dwell on that. No Government likes that situation. As it is such an important industry, we must try to see what remedies can be found but I do not think that to increase the price of butter helps the situation. It would have been far better, if the Government could have done so, to leave butter prices as they were.

That might mean greater consumption of butter or it might mean, at least, that there would be the same consumption as last year. It will be regrettable if there is less consumption of butter and if the surplus butter has to be exported and sold outside the country at a much cheaper price. I sincerely hope that the Government will take that matter in hand and that the new Minister for Agriculture will give it his early attention.

As I have said, the butter and milk problem has been with us for many years. A Milk Costings Commission was set up. To my mind it was used politically. I regret having to say that. It was used when the Fianna Fáil Government were in office as a churn to rattle to please the farmers and used, when we were in office, to embarrass us. I am sorry to have to say that, but that is how I feel about it. Milk and butter production is a very important item in County Limerick. I have the honour to represent East Limerick. Anything that affects that industry adversely is a national loss. Limerick City many years ago was world-famous for condensed milk. Thanks to the efforts of the last Minister for Agriculture and the Dairy Disposal Board, a powder milk plant, one of the most up to date in the world, has been installed in Lansdowne, Limerick, at a cost of something like £50,000. That was badly needed because when there was a surplus of milk, it was necessary to have an outlet for it. While condensed milk has not had the market in Limerick that it had in years gone by, we hope powdered milk will take its place to a certain extent. I think the gratitude of the whole country is due to Deputy Dillon, former Minister for Agriculture, for the encouragement he gave the Board to establish that factory in Limerick. I wish to thank him sincerely as the factory is established in my constituency.

I want to relate the matters I had in mind to a particular item. The farmers in County Limerick, to my mind, are the life-blood of the city and anything affecting their interests is worthy of mention in this House. The dairy farmer, the cattle farmer and farmers generally are entitled to the best price they can get for their produce. That applies particularly to dairy farmers. If many of the people who complain about the price of butter only knew the hardships which these farmers have to endure they would not be so ready to complain. A farmer has to devote a large portion of a seven-day week to milking cows; and that is a condition that does not obtain in any other employment.

There is no use in any political Party saying to farmers: "If you put us in we will give you a bigger price for milk and wheat." You can give a bigger price for milk only by increasing the price of butter, and you can give a bigger price for wheat only by increasing the price of flour. As everybody knows, we have now reached a situation in which both milk and butter have reached practically luxury prices. Milk is one of the essential everyday foods and it is delivered twice daily to the homes of the people. Any increase in the price of milk or butter is really a severe blow to ordinary families. I do not want to make any further comment beyond saying that I feel that the former Government were not treated fairly in the past three years by many sections of the people because there was an agitation, which was not honest, to increase the price of milk and wheat. It was not just or honest to tell those people, as they were told: "If you elect us you will get an increased price for your milk and wheat." I hold that that is playing politics a bit too far.

Another matter to which I wish to refer is to local authority housing. We all feel that local authority housing is a matter of which serious notice has to be taken now. I feel, in view of the present housing costs, that the ordinary person will not be able to pay the higher rates that will be demanded if houses are to be built in the same style as previously because of the increased costs in many directions which he faces. This is a matter in which the Government might take more interest when considering the financial condition of the country. It might be wise to modify our housing schemes. Some local authorities want all semi-detached houses——

An Leas-Cheann Comhairle

This would be a matter for the Estimate on Local Government.

Mr. Carew

I agree. I do not wish to delay the House any longer. I just want to assure the Minister that I realise the difficulties confronting him in endeavouring to do the best he can for all sections of the community and I hope that my remarks will be helpful. I have made them with that object in mind. I hope that if he can find any way of relieving the heavy strain that this Budget imposes on many sections of the community he will not fail to avail of it so far as finances allow.

Mr. Wycherley

I have followed with great interest this debate on this very unpopular Budget. I know that it is very unpopular but it has been brought in as a result of many years of excessive spending on the part of successive Governments. Successive Governments did not regulate their expenses as they should have. Agriculture, which contributes most to this country and which is responsible for 75 per cent. of our exports, received in return only a 10 per cent. allocation. In 1948 we had 500,000 males employed in agriculture and at that time they actually contributed 75 per cent. of our exports. A decline came in and year after year the numbers employed in agriculture dwindled. In 1956 the numbers fell to under 300,000. Notwithstanding that decline, agriculture still maintains its proud position of being responsible for about 73 per cent. of our exports.

I have listened to members from both sides of the House making strong appeals to farmers to work harder and to produce more, pointing out that that provided the only salvation of the country. I doubt if any other industry in the country could boast to-day of the same achievements as those of the Irish farmers, notwithstanding a dwindling population and a shortage of young men to carry out the work. Unfortunately the people who have left rural Ireland are mainly young boys and girls and we are left with too many old men and a lot of young children to maintain.

I understand that £250,000 is to be provided in the Budget for employment. I think it would be very unwise indeed to spend most of that money around Dublin, as was the case in the past. The young men in the area from which I come, and I do not blame them, will again take a single ticket to Dublin, or anywhere they are likely to get remunerative work in preference to remaining idle in West Cork, if employment is created in Dublin or these other areas as it was in the past by building houses, aerodromes and hospitals. There is vast scope for improvement in the area from which I come.

Even with modern mechanisation, there are hundreds of farmers who cannot take a combine into their holdings because the lanes are too narrow.

Thousands of acres of land are flooded because no money is available for cleaning the streams. Hundreds of farmers' houses have been vacated in my area. In some cases, they lock the doors and leave for better employment, either here in Dublin or in some foreign country; in other cases, they do not even lock the doors because they think it better not to do so.

I really appreciate the difficulties which will face the poorer classes as a result of this Budget, but I have no sympathy whatever for the richer people. Looking over statistics I got recently, I made this discovery. Deputy Byrne mentioned to-night the amount of liquor imported into this country and consumed here in the City of Dublin. I can assure you that it is not consumed by the farming community. I discovered that the cost of beer, wine and spirits imported into this country last year was £1,586,184. That is a tremendous amount of drink to be imported and consumed here in Dublin by the people who are clamouring for higher wages and shorter hours, while down the country the farmers' sons are driving the sweat out through their boots in an effort to make ends meet and working 14 hours a day.

That is the position obtaining in this country to-day. Up and down the country, farmers are getting fed up with both political Parties and my presence here is a clear indication of it. They are all very good when in opposition, but, once they become the Government, it is the same story over and over again all down the years. I am here as an Independent. I will not oppose the Government on every occasion; neither will I vote for them on every occasion. I will be as constructive and as helpful as I can in order to try to raise this country from the mire in which it is.

The economic conditions in this country to-day, as a result of unbalanced Budgets and over-expending by successive Governments down the years, are very bad indeed. It is not for me to tell the Government how they should have balanced the Budget, but the feeling of the people in my part of the country is that there are too many highly paid officials and salaried people in this country. A lead should be given in the right direction. I have no doubt that the President, Mr. Seán T. Ó Ceallaigh, would give a lead in that respect by reducing his own salary by 10 per cent. and by a reduction in the running of his own establishment by 10 per cent. If that lead were passed on to every Government office and institution in this country, it would mean a tremendous saving for the Exchequer and create remunerative employment for those very much in need of it.

I was impressed by the speech of the Minister for Lands. He said it was an extraordinary thing that in this country, surrounded by water, there was not even one training school for our fishing boys. Even in my own constituency, there are 100 miles of coast-line to which fishermen from all parts of Europe and further afield, come to reap the rich rewards of the seas. I believe we have the best fishing grounds in the world. At one time in my area, in the village of Baltimore, we had a fishery school established under a foreign Government which occupied this country——

An Leas-Cheann Comhairle

The Deputy could argue the question of fisheries more relevantly on the Estimate, which will come up very shortly.

Mr. Wycherley

Yes, Sir. I understand it has a bearing on the Budget but I will keep as closely to the point as I can. I have dwelt on the growth of Dublin and on the dwindling population of rural Ireland. Something practical must be done to stop the growth of Dublin and prevent the flight from the land. I feel it is up to this Government, as a strong Government, during its term of office to see to it that what has been happening for the past 35 years will not happen in the coming five years. If the Government succeeds in stopping the tide of emigration, I have no doubt that the young men who are now ready to pack their bags will be quite willing to stay at home and settle down in rural Ireland. One good man between the ages of 18 to 30 is better than three over that age. The wealth of any country depends on its youth. feel that it is because of the flight of our youth from the country we are in the financial difficulties besetting us to-day. There is plenty of work if only finance is directed down the country. I am afraid that was not done in the past. Only 10 per cent. was directed down there in the past.

I realise that the increases brought about by the Budget will mean a rise of four and a half points in the cost of living. However, when the prices of cattle, pigs and various other agricultural commodities dropped last year and brought this country into grave financial straits, when the income of the Irish farmer dropped by 12 points, very little commotion was made about it. Yet, that was actually responsible for the difficulties which have brought about the state of affairs existing to-day. More stability should be brought about in agriculture, in the prices of grain, of milk, of poultry and of eggs. It is the small farmer who produces the wealth of this country, but it is very hard for him to make a good living.

We all realise from figures published last year and again to-day that farmers with over £30 valuations have annual incomes of only £313. How many people employed in industry get as little as £313 a year? They have considerably more. That is why I say that the small incomes which small farmers have at the moment should be protected and improved, if possible, because it is the small farmers, with valuations of between £30 and £50, who are creating most of the wealth of this country. They should be helped and protected as much as possible by any Government having the interests of the community at heart.

From speeches I have heard, I have no doubt that the Government have the interests of the community at heart, but it is my duty to bring home more forcefully to them than has been done in the past that much more money must be channelled into small farms and into the fishing industry because these two industries are of vital importance to the country's economic life. Compare them with some of the industries established during the past few years, many of which are millstones around our necks. I notice that a sum of £250,000 is being allocated this year for exploring markets. I feel that the first market we should look after is our home market. It is an extraordinary thing that we should import over £1,500,000 worth of beer, wine and spirits in a single year. The figure in relation to clothes, boots and shoes and other types of clothing would make startling reading.

If we are to spend £250,000 in developing markets, we should, as I have said, spend the very first £1 in developing the home market, to see that Irish industry will be able to stand on its own feet. I agree that we should give new industries a certain amount of protection in their growing stages, but I cannot see any justification for subsidising and protecting industries established for upwards of 20 years. An industry established for that length of time should be able to fight its own battles and compete not only at home, but on foreign markets as well. When they are subsidised, the same competition does not exist and the same incentives do not operate for increased production generally.

When we have looked after our home market, we can then contemplate what we should do to sell on the export market. Irishmen at home should be as good as Irishmen who have gone abroad. We find that nearly every Irishman who has left our shores, be he from West Cork or from any other part of the country, has done remarkably well abroad. Is it not extraordinary that, while they can do so well abroad, many of them fail miserably at home? It is very hard indeed to get to the root of that problem. I know hundreds of men of my own age who went abroad and each one of them rivalled the other in success. If they had stayed at home, I have no doubt they would not have done so well, perhaps because the same opportunities do not exist here.

I agree with other speakers that there is great scope for the development of our minerals which, if properly developed, could bring great employment and great wealth to many areas, including my own. It is a matter that deserves very close consideration and any help the House can give such explorations should be available.

An Leas-Cheann Comhairle

The development of our mineral resources is a matter which would be more appropriately dealt with on the Estimates.

Mr. Wycherley

In my opening remarks, I said I had great sympathy for the poor people who will be hit hardest by this Budget. I include, of course, the old age pensioners. The 1/– increase in their allowances is not sufficient for them. I would be the last to try to impose a halfpenny more on the taxpayer, but I feel that in order to provide additional allowances for old age pensioners there is ample scope for reducing expenditure in other directions. As I have said, I would have started at the top with the President. We must all realise that old age pensioners are unfortunates who had worked hard during their life to keep the country going. They were the people who contributed to obtaining for this country the freedom it now enjoys and they are certainly entitled to more consideration from us than they are now getting.

I think that the means test for these people is much too strict. This is a matter with which I am closely concerned and I am amazed at the number of old age pensioners who have great difficulty in getting any allowances— men who worked hard during their lives being deprived of their just rights at the end of their days. If we could bring about reductions under other headings, we could also give increased children's allowances, particularly to poor parents. Poor people may not always be poor; there are ups and downs in every walk of life, and the poor people of to-day may be the wealthy people of to-morrow. Accordingly, we should be as generous to those people as we can. The social security scheme and the health scheme which were introduced some years ago are now running away with £27,000,000 annually. Notwithstanding that, these schemes are not producing the great social advantages that were promised for them.

An Leas-Cheann Comhairle

The Deputy is getting away from the Budget.

Mr. Wycherley

There is no doubt that this Budget is the most severe Budget ever imposed on the people of this country. However, it is only in keeping with previous Budgets, because as far as my memory goes back, each Budget has rivalled its predecessor in severity.

Progress reported: Committee to sit again.

The Dáil adjourned at 10.30 p.m. until 3 p.m. on Wednesday, 22nd May, 1957.

Dáil Éireann debate - Tuesday, 21 May 1957

Committee on Finance. - Resolution No. 5—General (Resumed).

An Leas Cheann-Comhairle

Dáil Éireann debate -
Tuesday, 21 May 1957