Dáil Éireann debate -
Thursday, 6 Nov 1958

Vol. 171 No. 5

Electricity (Supply) (Amendment) Bill, 1957—Second Stage.

Minister for Industry and Commerce (Mr. S. Lemass)

I move that the Bill be now read a Second Time. The purpose of this Bill is to effect a number of miscellaneous amendments in various provisions of the Electricity (Supply) Acts, 1927 to 1955, the Shannon Fisheries Act, 1935, and the Liffey Reservoir Act, 1936. These amendments relate to rural electrification, fisheries, compensation for interference with a public bridge, powers to dispose of land, membership of the Oireachtas, and pension matters.

The effect of Section 2 is to raise the limit of expenditure for rural electrification to £30,000,000. The existing limit of £25,000,000 was authorised by the Electricity (Supply) (Amendment) Act, 1955, and was intended to cover expenditure up to this year. At 31st March last, the board had spent or was committed to spend approximately £23,000,000. At that date 184 rural areas still remained to be developed and it is estimated that the cost of the entire scheme will be not more than £30,000,000. It is hoped that the scheme will be effectively completed by 31st March, 1962.

The object of Section 3 is to reintroduce a Government subsidy of 50 per cent. for rural electrification as from 1st April, 1958. Such a subsidy was payable from the commencement of the rural electrification scheme in 1946 until 1955 when the subsidy was withdrawn. It was then argued that the board had reached a position in which, from their own resources, they could provide all the finance required for future development. The financial expectations of 1955 have not, however, been realised. In the year ended 31st March, 1955, the board had a gross surplus of £928,659 including a surplus of £44,130 on rural revenue account.

The net surplus fell to £50,184 in the year ended 31st March, 1957, the deficit on rural revenue account being £491,645. In the year ended 31st March last the board had a net deficit of £180,017 on general account, while the deficit on rural revenue account had risen to £552,197. While other causes, notably a reducing rate of increase in demand for electricity generally and the charges arising from the bringing into operation of new generating stations in the last few years, have operated to reduce the board's annual surplus, the fact is that the demands of rural electrification have meant the difference between a modest surplus and a loss on the board's electricity net revenue account. The average return on capital represented by fixed charges is falling heavily with the connection of new rural areas and the annual deficit on rural account when the scheme is completed would, in the absence of a subsidy, be well over £1,000,000. The board have been increasingly perturbed by the growing deficits on rural electrification.

Although originally it was intended that the State would provide part of the capital free, the board have now for some years been required to provide all the capital necessary and have been required also to extend supply to areas which are increasingly uneconomic. The relief which the subsidy will afford to the board is unlikely to eliminate losses on rural electrification and, in the circumstances, I have accepted a rather slower, rate of development. There is no doubt that the rate and extent of rural electrification have been much greater than they would have been if commercial considerations only had been taken into account. As these considerations are being ignored on the insistence of the Government, I am satisfied that the Government should in equity assume as far as possible responsibility for the financial consequences.

Section 4 of the Bill, coupled with Section 3 (4), will relieve the Minister for Finance and the E.S.B. of the obligation to earmark advances to the board as being for rural electrification or for general purposes. It was found difficult to determine beforehand the purpose to which a particular advance would be applied. Expenditure for general purposes will be limited to £100,000,000.

Sections 5 and 6 of the Bill are designed to improve the accounting procedure for the board's fisheries. Before a decision to develop or abandon a fishery can be made, certain expenses must be incurred on investigating its potentialities. In addition, expenditure must be incurred in maintaining and preserving the existing stocks of fish while the investigations are going on, Under existing legislation, all these expenses are chargeable to the fisheries accounts, even though the fishery concerned might never be operated. Regardless of whether the fishery is operated or not, it is unrealistic to burden the fisheries accounts with these expenses, which arise solely because of the disturbance caused to the river by the hydro-electric development. The restoration of fisheries is a difficult enough process without loading these expenses on to the fisheries accounts. Under Section 5, it is proposed, therefore, to authorise the board to charge these expenses to their general revenue account.

The object of Section 6 is to enable the board to transfer to their general revenue account the annual profit or loss arising out of all their fisheries activities. Under existing legislation, the board are required to keep a separate capital account and balance sheet for the Shannon and other fisheries. The intention was that fisheries should be operated independently and would provide sufficient income to remunerate the capital invested in them, but this hope has not been realised. The Shannon Fisheries, which are the largest, have incurred growing deficits. Each year these deficits are transferred to the fisheries balance sheet which is required by existing legislation, and by 31st March last they had accumulated to the total of £56,551.

I think it is now clear that hydro-electric development involves such severe damage to the fisheries in a river that their rehabilitation, assuming it is possible at all, is a long and costly process. Deficits are likely to occur for many years before the fruits of the restoration work can be expected. As the board's involvement in fisheries operations is a direct result of hydro-electric development these operations cannot be regarded properly as a separate undertaking. An amendment to the existing accounting procedure is, therefore, called for and the only sensible thing to do is to abolish the separate capital account and balance sheet and to incorporate the results of the board's fisheries transactions in their general accounts. In this way, the board's fisheries will be treated in the same manner as their other subsidiary activities. Separate trading and profit and loss accounts are published by the board in respect of these activities, but the balance on each of these accounts is transferred annually to the general revenue account.

I might mention at this stage that I shall be introducing on the Committee Stage a provision designed to permit the board to incur expenditure on the development of new fisheries which may arise in the reservoirs of hydro-electric schemes. Under the legislation as it stands, the powers of the board are confined to fisheries which exist before a scheme of hydro-electric development is undertaken. In fact, however, new fisheries are arising and it is desirable that the board should have powers to develop and manages them as well as the existing fisheries if they so think fit.

Section 7 of the Bill authorises, the board to pay compensation to persons who have suffered serious loss or inconvenience as a result of the sub-mergine of Fitzgibbon Bridge by the Lee hydro-electric scheme. Under the Electricity Supply (Amendment) Act, 1945, the board are empowered to submerge or otherwise interfere with any public or private road or bridge for the purpose of carrying out a hydro-electric scheme. The Act provides that in the case of private roads and bridges, compensation shall be payable by the board. No provision is made for the payment of compensation for interference with a public road or bridge, but in general the board are required to provide suitable replacements, unless relieved of this obligation by Order made by the Minister for Industry and Commerce after consultation with the Minister for Local Government.

The approval Order for the Lee scheme provided for the submerging of a public bridge over the River Dripsey known as Fitzgibbon Bridge, and for the erection of a new bridge some distance upstream. In April, 1956, the board requested my predecessor to make an order relieving them of the obligation to construct the replacement bridge. The board stated that because of the nature of the site the construction of a bridge would be technically difficult, and its cost would be out of all proportion to any use which might be made of it. My predecessor decided not to accede to the board's request.

In May of last year, the board requested me to reconsider this decision and they suggested that if I were disposed to agree that the new bridge was not required, they should be empowered to pay, at their absolute discretion and entirely on an ex gratia basis, suitable compensation to those affected. As I was not prepared to agree to allow the board to be the sole arbiter regarding the persons entitled to compensation and the amount to be paid, I informed them that the obligation to provide the replacement bridge must be discharged by them, unless they could negotiate an agreement acceptable to the majority of the landholders concerned. I made it clear that if they succeeded in concluding a satisfactory agreement with the landholders, I would promote any legislative measures necessary to enable them to implement this agreement.

The majority of the landholders have now agreed to do without the bridge in return for compensation payments, the amounts of which have already been agreed with the E.S.B. As I have already mentioned, there is no provision in the Acts whereby compensation can be paid in cases where a public road or bridge is interfered with. The position is, therefore, that although the board have negotiated this agreement with the landholders, they are, under existing legislation, unable to make the necessary compensation payments. The object of Section 7 of this Bill is to give the board the power to make these payments.

Mr. Norton

Before the Minister passes from that section, would he mind saying with how many landowners has agreement been secured and how many are still holding out for a new bridge?

Mr. S. Lemass

Thirteen out of 16 have accepted.

Section 8 of the Bill is designed to remove doubts about the board's powers to dispose of property. Under the Electricity (Supply) Acts, 1927-1955 and the Liffey Reservoir Act, 1936, various powers for the acquisition of land required for the performance of their functions were conferred on the board. Some of the lands acquired for the carrying out of particular schemes, especially hydro-electric schemes, eventually become surplus to requirements and they are then sold. The board have been advised that the powers conferred on them for such disposals are inadequate in some cases and doubtful in others. Although these powers have never been seriously questioned, it is essential that the board should, if required, be able to satisfy a purchaser that their powers of disposal are clear and adequate. If they are unable to do so, a situation may arise in which they will have to retain property which is surplus to their requirements and this, of course, would be undesirable. The purpose of the proposed amendment is to put the board's powers beyond doubt; it does not confer any new powers on them.

Section 9 of the Bill revokes Section 3 of the Electricity (Supply) Act, 1927. The Act of 1927 provides that every member of the board and every officer and servant of the board shall, while holding office or employed as such member, officer or servant, be disqualified from nomination for or membership of the Oireachtas. In effect, this meant that a member of the board or its staff was disqualified from being a candidate in a parliamentary election. The principle now followed in legislation is that, where membership of the Oireachtas is incompatible with membership of a State-sponsored body, the person concerned may opt for one or the other. Under more recent legislation dealing with the establishment of various State bodies, the practice has been simply to provide that a member of the Dáil or Seanad may not be a member of the body and that if any member of the body becomes a member of the Dáil or Seanad, he shall cease to be a member of the body.

Mr. Norton

Only during his membership of the Oireachtas? He can go back to his employment if he ceases to be a member of the Oireachtas?

Mr. S. Lemass

That is right. I shall deal with that in a minute.

In the present Bill, it is proposed to provide that a member of the Dáil or Seanad would have to resign before he could be appointed a member of the board or seek employment under the board. As regards seeking election to the Dáil or Seanad, it is proposed to make a distinction between members of the board and officers and servants of the board. It is proposed to provide that a member of the board would have to resign before offering himself as a candidate for election, but that officers and servants be free to seek election and if one is elected that he shall absent himself from his employment and shall not be paid for the period of his absence.

A provision is included to ensure that if a person qualifies for a pension in respect of a period of service as Minister of Parliamentary Secretary, the same period cannot count for pensions from the board. On the Committee Stage, I shall introduce a new provision which will clarify fully the position in regard to the maintenance of pension rights of employees of the board who may becomes members of the Oireachtas.

Sections 10 to 13 of the Bill are designed to enable the board to pay to their former employees pension increases similar to those provided for other pensioners under the Pensions (Increase) Act, 1956. Under that Act, provision was made for pension increases for former teachers, members of the Garda Síochána, local authority employees, harbour authority employees and others. Some time ago the Minister for Defence laid before the House a scheme to secure similar pension increases for members of the Defence Forces. It is only fitting, therefore, that this opportunity should be availed of to authorise appropriate pension increases for former employees of the E.S.B.

The intention of the Pensions (Increase) Act, 1956, on which these provisions are modelled was, generally, to provide for increases in those pensions which were granted in respect of service which ended before the 1952 general revision of salaries. This is the basis of the provisions of the present Bill which relate to the general employees of the board. In the case of manual workers, however, it is proposed to authorise the board to grant increases within the limits set by the Pensions (Increase) Act, 1956, where they think fit to persons who retired at any time up to 1st July, 1957. The reason for this is that many of these workers retired on very small pensions because of their inability to purchase at a reasonable price suitable pension units under the superannuation scheme.

Section 14 proposes the amendment of the superannuation terms of the present chairman of the board. Under the Electricity Supply Board (Superannuation) Act, 1942, as amended, full-time members of the board are entitled to a pension at the rate of 1/48th of retiring salary for each year of service, subject to a maximum of 24/48ths, but no lump sum is payable. Prior to his appointment in 1930, Mr. Browne, the present chairman, had been a full-time civil servant for a period of about 18 years, and on joining the E.S.B., he was granted special leave without pay. As a civil servant, Mr. Browne is entitled to a pension at the rate of 1/80th of his salary as at the date of his appointment to the E.S.B. for each year of his Civil Service service, together with a lump sum of 1/30th for each year of service. Under existing legislation, therefore, Mr. Browne's accrued pension and gratuity as a civil servant would be payable to him in addition to his E.S.B. pension.

It is now proposed to cancel Mr. Browne's Civil Service superannuation allowance, and instead, to grant him superannuation allowances on the lines of those payable in the Civil Service and based on the aggregate of his service in the Civil Service and in the E.S.B. The effect of the amendment is that Mr. Browne, on retirement, will be paid a pension of half his retiring salary together with a gratuity equal to one and a half times that salary. This section implements a decision taken by my predecessor. I might remark that the Transport Act, 1950, contains provisions on similar lines in respect of the superannuation of the former chairman of C.I.E. who also was on special leave from the Civil Service.

Under Section 14 of the Superannuation Act of 1942, the board are empowered to add up to ten years to the period of pensionable service of employees who were 40 years of age or over on the passing of the Act. Under Section 15 of the Act they are also empowered to pay supplementary pension allowances to certain persons transferred to the service of the board from undertakings acquired by the board. Section 15 of the Bill will permit the surrender of the whole or part of these supplementary pension awards in return for an appropriate annuity for a dependent as may already be done in the case of ordinary pensions.

Section 16 of the Bill is intended to remove any doubts which may exist regarding the dates of operation of amendments to the existing superannuation schemes of the board.

The purpose of Section 17 is to amend certain provisions of the manual workers' superannuation scheme which have been in dispute between the board and the members of that scheme for a number of years following the introduction of an amending scheme in 1952. This is a complicated problem. Broadly, the position is as follows. The 1952 amendment permitted manual workers, who had served with the board prior to 1st April, 1943, to supplement the basic pension under the board's scheme by the purchase of pension units whose value varied with length of pensionable service. Unfortunately, the 1952 amending scheme was open to differing interpretations in regard to liability for payment for service prior to the date of purchase of these units. The board, on the one hand, contended that their maximum liability was limited by the 1942 Act which provided for equal contributions by the board and the member in respect of all service subsequent to the introduction of the original scheme in 1943, while, on the other hand, members interpreted the scheme as requiring the board to pay the greater portion of the costs.

Various efforts to resolve the dispute were unsuccessful, but some time ago a compromise solution of the difficulties was agreed between the parties. Under this solution, the members concerned will contribute to the pension fund one half of the cost of their pensionable service subsequent to the date of purchase of each new unit while the board will pay half the cost of all the members service towards the purchase of these units. The effect of the new arrangement is that the combined contributions to the pension fund will be reduced, with a consequential reduction in the benefits payable. I am satisfied that the solution is fair and reasonable and is one which should be accepted.

The next provision of the Bill is Section 18, which refers to the rate of interest payable by the board on loans made to them by the trustees of the superannuation funds. Section 14 of the Electricity (Supply) (Amendment) Act, 1949, provided that the rate of interest so payable should not exceed 4 per cent. The reason why this figure was selected was that in the calculations on which the funds were based, the actuary assumed a rate of 4 per cent. per annum. With the increases in interest rates which have taken place in recent years that rate is no longer realistic and a position has now arisen in which the trustees can secure a better return on their funds elsewhere. Unless, therefore, provision is made for the payment of a more attractive rate of interest, they may invest their funds wholly outside the board.

As these funds represent a useful source of additional finance for the board, that would be most undesirable. It is proposed, therefore, to remove the limit of 4 per cent. In view of the possibility of further fluctuations in interest rates generally it would be inappropriate to fix another figure in substitution for that existing limit, and it is proposed, therefore, to provide merely that the rate payable shall not exceed that charged at the time on advances from the Central Fund.

There is one other matter I think I should mention at this stage. For some time, I have felt that some arrangement should be made whereby the Minister for Lands would be more closely associated with the administration of the board's fisheries and it is possible that I may be able to indicate definitely on the Committee Stage of the Bill the manner in which this will be done and to move the appropriate amendments which will be necessary. There will, in any event, be another E.S.B. Bill in the near future to increase the capital provision for the board's general purposes, and this will afford an opportunity to Deputies to discuss the board's general development programme and to introduce the amendments to the fisheries clauses if they are not ready in time for inclusion in the present Bill.

Apart from the provisions in respect of rural electrification, which I feel will have the support of all Deputies, the amendments are largely of a "tidying-up" character and I therefore recommend the Bill for the approval of the House.

Mr. Cosgrave

This Bill, including as it does, provision for further expenditure on capital development, particularly on rural electrification, brings before the House and the country the remarkable success of the E.S.B. undertaking. The last report indicates that including expenditure on capital works which were still under construction at the end of the year, and adding that expenditure of over £4,000,000 to the previous total of £93,800,000 on generation, transmission and distribution, the total capital investment comes to over £98,000,000.

It requires little effort to imagine what our economic condition would be like without the power and light which is being brought to urban and rural areas by this undertaking. All those who are responsible for its success deserve the commendation of the House and the country. It has supplied opportunities for employment for Irish-trained engineers and technicians and craftsmen of various categories. By their work, they have brought credit to the undertaking and demonstrated that when Irish people are given the opportunity, they can acquit themselves with distinction in technical fields. It is all the more satisfactory that it was possible in this case, as in a number of other State undertakings, to employ Irish technicians in developing their own country. In the past, too many of those people were obliged to use their talents elsewhere. This enterprise is a striking tribute to the vision of those who conceived it and has more than justified the most optimistic views which were held concerning its success. I believe, therefore, that the proposals contained in this measure will find general approval.

I should be glad to know from the Minister if the provision of subsidy will enable full development of uneconomic areas under the rural electrification system. As I understand the system as it has worked up to the present, areas are taken on a certain basis and allowing for comparison between the number of people who accept in different areas, priority is given to those with the largest number of acceptors. That stage is now drawing to a conclusion, if it has not already been completed, but when all these areas have been developed, or when a whole district has been developed, pockets are still left where people, because they failed to be included in two adjoining areas, find themselves without current. I know many cases where the supply could not be extended on anything like an economic basis or even on the same terms as it was possible to extend the rural network to the adjoining areas. I should be glad, therefore, to know whether it is proposed in this measure to extend the supply to all consumers who are prepared to take it and whether that will include those areas which have been considered up to the present to be uneconomic.

As I understand the E.S.B. programme, the present and planned generating capacity of hydro stations and turf-fired stations will be completed by 1961 or 1962 and at that stage all existing sources of power available in the country—hydro and turf-fired—will be either completed or in process of completion and after that date supply will depend either on further oil or coal-fired stations or on the use of atomic energy. The previous Government established a committee, which reported last year, on the question of acquiring, at the instigation of the United States of America, an atomic reactor. The committee reported and I understand that the report was sent to the various Government Departments interested. I would be glad to know when Government policy on that report will be made known, if a decision has yet been reached on the recommendations made in the report and what steps will be taken to implement it.

On this question of retirement pensions, some years ago I received representations—I do not know whether the matter has been settled since—concerning those who are employed in what are known as "transferred undertakings". Some of those people had been employed in a similar capacity in those undertakings prior to the acquisition by the E.S.B. of the smaller electricity supply plants. Quite a number of them were employed at an age which precluded their gaining full-time service, counting their years of service with the previous undertaking and whatever years of service were still available to them under the E.S.B. I do not know whether or not added years have been provided but I would be glad to know whether consideration will be given to that small number of persons whose services up to the present precluded their getting a pension or in some cases precluded them getting anything like a pension which would enable them to live under reasonable conditions. Some of them undoubtedly did get small pensions, but nothing like what they would have got if full service or added years were provided for them.

As this is the first occasion on which we have discussed this matter since the retirement of Dr. T.A. McLaughlin and Mr. J.M. Fay from the board, it is appropriate that a tribute should be paid to the work which they did as members of the board for a great number of years and for the distinguished service which they rendered as members of the board, both to the E.S.B. and to the general welfare of the community, arising out of the success of that undertaking.

Mr. Norton

As the Minister said, this is very largely a routine Bill which does certain legislative tidying up on the code of legislation on which the E.S.B. relies for the operation of its undertaking. Therefore, one has not to engage in any wide or length survey of the board's activities. There are some matters, however, that I should like to raise on this Bill. One arises out of Section 7, which is designed to enable the board to provide compensation to persons for loss or inconvenience due to the submerging of what is known as the Fitzgibbon or Dripsey bridge in County Cork. The question as to whether the board should provide an alternative bridge in lieu of the bridge which would be submerged has been the subject of a good deal of heated contention in that region. The local residents felt that it was essential to their way of life that an alternative bridge should be provided in lieu of the Fitzgibbon bridge, which the board felt it was necessary to submerge for the purpose of their Lee hydro-electric scheme; and efforts at that stage to tempt them into submissive silence by offers of financial compensation did not attract the persons concerned.

I now gather from the Minister that 13 out of 16 persons affected have indicated their willingness, to accept compensation. Am I right, however, in thinking that this case is before the courts, has been before the courts or is likely to come before the courts, in which some local people are insisting on their right to have an alternative bridge provided? I do not know the precise legal position at the moment, but I have some kind of recollection that this matter has been the subject of litigation. Whether the litigation is in prospect or whether the matter has been or is still before the courts I cannot say, but perhaps the Minister when he is replying would throw some light on the position in that respect. I take it that if the matter is before the courts, the persons concerned will not have their legal rights interfered with by the passage of a section in this Bill. It would be unfair to deprive them of access to the courts if access to the courts at present constitutes their constitutional rights.

Under another section of the Bill, Section 9, when a person becomes a member of either House of the Oireachtas he goes off the pay roll of the E.S.B. It does not say that when he ceases to be a member of the Oireachtas he may go back to the E.S.B., nor does it say what is to happen his pension rights which accrued to him whilst he was a member of the E.S.B. staff and before he became a member of either House of the Oireachtas. If a person has served as a member of the E.S.B. staff for, let us say, 20 years and then decides that he will share his talents with the nation by becoming a member of the Dáil or Seanad and remains in either House for four or eight years and is then unsuccessful in maintaining the confidence of the people or of the Government, as the case may be, and then goes back to the E.S.B., is his 20 years' service preserved for pension purposes? In other words, are his accrued pension rights, as it were, parked for him so that he can bring them to life on going back to the E.S.B.; or can be, at the time that a pension would normally be payable to him on retirement from the E.S.B. if he had not left the service of the board, count upon a pension based upon the number of years' service which he rendered to the board? Perhaps the Minister would throw some light on that situation when replying.

There is one other matter to which I should like to refer. I am not too sure whether it is in order, but if the Chair will be indulgent with me for two or three minutes I can dispose of the matter, particularly in the light of the other Bill on the subject of the E.S.B. which the Minister has foreshadowed. The E.S.B. have done a first class job in the matter of rural electrification. The success of the rural electrification scheme has brought the amenity of lighting and heating into rural, and even exceptionally remote, areas. In that way they have certainly done an enormous amount of good in brightening and making more tolerable the conditions of life of the people who live in these remote areas.

For the purpose of its rural electrification operations the E.S.B. have an excellent field staff which operated throughout the country and not only was it able to provide rural electrification expeditiously but also to do a first class job which commanded the admiration of everyone, both inside and out-this House. It is a pity that because the board has operated so efficiently and expenditiously that organisation, which was created for the purpose of rural electrification, should be disbanded. I think it could be put to other operations.

We are now approaching the stage where practically everybody in rural areas is an E.S.B. consumer and in practically all of these rural areas everybody wants to get water and sanitation services. I tried to fertilise the mind of the Minister for Local Government, in the previous Government, with the idea that the E.S.B., which is now the provider of light in rural areas, should be given power to provide water services in rural areas, that the work could be carried out by an organisation equivalent to its rural electrification organisation and that the cost of providing the water supply by an E.S.B. equipped with such powers could be charged by the board on the electric light bill. Thus it would be within the competence of the board to recover its expenditure and, at the same time, be within the ability of people in the rural areas to obtain a water supply.

In these days with the use of the electric motor and with the provision of the polythene pipe all one has to do is to find a clean stream or spring and by the use of the electric motor which the E.S.B. can supply, consuming E.S.B. current, it should be possible without much difficulty, especially to an organisation like the E.S.B., to provide water services in these areas.

The board could then become not merely a provider of light but a provider of water services, and perhaps sanitation services at a later date. I do not want to develop that point as it is probably out of order, but I do think that, before this organisation is submerged, some consideration should be given to equipping the board to do a job of that kind. If it can, in respect of providing water services in rural areas, do half as much only as it has done in respect of providing light in rural areas it will have done an excellent job. It will be doing an excellent job for the people and bring them a new service which will parallel in comfort the excellent service provided by electric light in the rural areas. I shall leave that idea with the Minister. I think it is only by equipping some national authority like the E.S.B. with such power that you are going to see water services in the really remote areas.

Mr. Russell

I should like to have a few points clarified. One of them is in connection with the subsidy which I think is largely one to cover the losses the board is incurring on the extension of its activities to the rural areas. The Minister stated that the board now operates at a loss somewhere around £500,000 on its activities in the rural areas. Is this subsidy a continuing subsidy, or a subsidy purely against capital outlay on the extension of electricity to the rural areas, and has the E.S.B. indicated to the Minister what capital outlay will be utilised to complete rural electrification schemes which they have either in course of construction, or which they propose to introduce? If the subsidy is sufficient to offset the losses on the rural electrification side of the E.S.B.'s business can we then assume that the board will operate at a reasonable profit on the rest of its undertaking?

The only other point is in regard to Sections 5 and 6, in connection with the Shannon fisheries. I contribute wholeheartedly to the praise which Deputy Cosgrave gave to the E.S.B. as an electricity undertaking and for the very fine job they have done over the past 30 odd years. I cannot, however, say the same about their activities in regard to the Shannon fisheries. The Minister did hint that he hoped to introduce an amendment on the Committee Stage to associate—I think that was the word—the Minister for Lands more closely with the fishery activities of the E.S.B. I would seriously urge the Minister to go a step further and dissociate fishery activities completely from the E.S.B. It would be far more appropriate, and better from the point of view of the fisheries, if they were transferred completely to the aegis of the Minister for Lands and Fisheries.

I know there may be technical difficulties in the way but these should not be insurmountable and in the final analysis the thing that accounts most is the best method of developing the Shannon fisheries which should be of far greater advantage to the country than they are. The present Minister for Lands is a very active Minister and has given proof of his interest in fisheries. It would be a sound and progressive step to transfer this side of the E.S.B. undertaking completely to his responsibility. I also join with Deputy Cosgrave in paying tribute to Dr. McLaughlin and Mr. Fay who gave such excellent and long years of service to the E.S.B. and, through the board, to the community.

Mr. Moloney

I should like to make a few observations arising out of the discussions on the Bill. It is not a very controversial matter but nevertheless it provides us with an opportunity of raising a few matters which have been bones of contention for some time. A previous speaker, with Deputy Cosgrave, referred to the exceptional charges which the E.S.B. are inflicting on consumers in rural districts where they are classified as belonging to the uneconomic areas. It is beyond the comprehension of the ordinary man to understand when an area is economic and when it is uneconomic. I find it very hard to satisfy myself from the explanations I get when I make inquiries in individual cases as to why a particular pocket or area is classified as uneconomic.

The E.S.B. is a national service and should not differentiate in supplying that service. I think the system of introducing levies in certain pockets regarded as uneconomic is a bad one. I submit it would be as logical for the Minister for Posts and Telegraphs to insist on a surcharge for delivering a letter in an out-of-the-way district. I seriously suggest to the Minister that he might avail of this opportunity to take up the matter with the E.S.B. and try to get the board to accept the good with the bad and to offer an overall average charge. The present system does not help to get people in rural districts to co-operate as well as they might in the ordinary way in the case of the canvass which is necessary before electricity can be brought into an area.

I find it hard to understand why one, two or three houses, possibly only 100 yards away from other houses, are singled out as uneconomic and the householders told they will have to pay a rent greatly in excess of that paid by their neighbours across the fence or road. We should now have arrived at a position in the case of this service when we could reasonably request the board to introduce an average overall charge.

I am very pleased that the Bill has come along at this stage, particularly Section 3 which implements an assurance given in the Minister's Budget speech. Unfortunately, the rural electrification scheme was more or less in suspense for the past couple of years until a few months ago and I think we can now look forward confidently to seeing areas hitherto undeveloped being dealt with. I would ask the Minister to bring to the notice of the board the fact that the canvass which was made in a number of areas some years ago is now completely out of date and I suggest that if at all practicable, the people initiating schemes in different areas—I mean local people—should get an opportunity of carrying out a further preliminary canvass and explaining to householders whom they found it difficult to entrol formerly that it is now possible with the special subsidy to carry out a development programme. Many people were not prepared to co-operate previously because they were rather frightened about the special charge to which I have referred. If the board can give any facilities in that way—and I think they can—the position in the outstanding areas would be much improved and the people would be anxious to co-operate.

The fixed charge is a special problem in a number of Gaeltacht areas, particularly in North Kerry. The houses were built under various schemes of grants operated both by the Congested Districts Board and by native Government and in those days the preference seemed to be for larger houses. I take it the population in the districts in those times was very much greater than it is now and possibly the idea of the big houses was to have dwellings which would accommodate large families. Perhaps, also, the people were keeping an eye to the future and had visions of tourist traffic and thought it a good idea to provide more than ordinary residential accommodation. The result is these people now find themselves with large houses carrying a high valuation so far as size is concerned, but a valuation very much higher than in the case of a house of normal size. Canvassers in Gaeltacht areas at present find considerable difficulty in getting householders to agree to the fixed scale charges in connection with the installation of power. There is no great difficulty in getting people to pay the standard charges, but the other difficulty is, I believe, almost impossible to overcome.

I had hoped that some special concessions might be given by the E.S.B. to these Gaeltacht areas or, alternatively, that the Minister might have a word with the Minister for the Gaeltacht with a view to making some suitable arrangement, even if it were impossible to get the board to give a special rate. The Minister for the Gaeltacht might give some subsidy——

An Ceann Comhairle

I do not think the matter arises on this Bill.

Mr. Moloney

I am making the suggestion——

An Ceann Comhairle

The Deputy has made it now.

Mr. Moloney

I join with Deputy Russell in his reference to the utilisation of the fisheries of the E.S.B. I think the E.S.B. acquired these fisheries some years ago because they wanted certain facilities regarding the usage of water and it was desirable that they would have exclusive control. That left the E.S.B. in possession of fisheries and, like other big bodies, I think they found difficulty in working the fisheries economically I believe the time has arrived when a very full examination of this question is desirable and I suggest the Minister should ask the E.S.B. to consider the advisability of leasing out these fisheries, subject, of course, to certain control which it would be necessary for them to retain.

I feel the fisheries can best be organised and developed—and I would say, more successfully developed—by private interests and I suggest the E.S.B. could come to some arrangement with the interests to which I have referred. Sooner or later, some steps will have to be taken to rectify this position. Those of us who live in areas where the fisheries are the property of the E.S.B. know that these fisheries are not worked to the best possible advantage. Considerably greater revenue could be obtained from these fisheries, if they were operated by private enterprise. I hope the Minister will be successful in getting the E.S.B. to see that point so that some arrangement may be entered into under which the fisheries in question will be made available to private interests for operation.

Mr. Manley

I agree with the Minister that this Bill does not envisage any major changes. Nevertheless, it provides for very important obligations and the public mind will be a little disturbed by the revelations made by the Minister this morning. We all appreciate that the provision of electricity is of permanent importance. The E.S.B. is one of our greatest national undertakings. Were it not for the provision of electricity on a national basis, our chances of survival economically would be very meagre. But the public mind will be somewhat disturbed to learn that at this stage of development the expenditure of the E.S.B. is outpacing its revenue.

We all thought that, by 1958 at least, the E.S.B. would be in a position financially to stand on its own feet. We are disappointed to find that is not the case. It is perturbing to discover that, despite its multitudinous charges and rentals, it is not able to amass sufficient revenue in any one year to meet its expenditure. I hope this will be the last provision this House will be called on to make in relation to subsidising the E.S.B. The board has gone into the open market to get capital. Despite that, it has to come back again to the national purse to get further provision for some of its undertakings.

I should like to join with others in the appeal for the provision of current to holdings which are regarded as uneconomic from the point of view of the board. This is a contentious question. It is difficulty to reconcile further penalising of these unfortunate people living in remote areas. They have to suffer many drawbacks. They have the worst roads. They pay their rates and they honour their other obligations. It is too bad that they should be further penalised. Surely under a national undertaking like the E.S.B., it should be possible to supply them with current in fair competition with their more fortunate neighbours. The fixed charge is harsh. There should be some easement and a fairer appraisal of their position. A more sympathetic effort should be made to provide them with current.

Another problem which arises is the fact that since areas have been developed, new houses have been erected. The occupants of these now find, when they apply for current, that they will have to meet an extra fixed charge. That is inequitable. I trust the Minister will use his influence to ensure that the people concerned will get this amenity to which they are entitled and which they all assumed they would get, on the same basis as their neighbours. There should be no differentiation.

The Minister and Deputy Norton referred to Fitzgibbon bridge in the course of the debate. I am still doubt full that the right action has been taken in connection with this bridge. It is not a case of compensating people for loss of property; it is a case of compensating them for inconvenience caused through the policy of the E.S.B. It is difficult to assess adequate compensation for those disturbed and inconvenienced. These people will be cut off entirely from their traditional access to the main Cork road. That entails great hardship, so far as they are concerned.

I know that the previous Minister was badgered about this matter for a long time and I know that he went very far to try to meet the demands of the people concerned. No one would condone extravagant expenditure on the erection of a bridge to be utilised by comparatively few people, but these people had a traditional right of access. I wonder does this Bill override their rights to a further appeal to the courts of this country? This matter has been the subject of litigation before now. Perhaps it will go into abeyance now that agreement has been obtained from 13 of the 16 people affected by the submerging of this bridge.

Independent engineers held the view that it was possible to construct a bridge which would not cost anything like the sum appearing on the files of the E.S.B. Were all avenues explored before the board finally decided to submerge the bridge? I wonder is the county council entitled to any consideration in this matter? Their property was submerged. Are they included in the 16 to whom the Minister referred this morning?

Mr. Loughman

I wish to support Deputy Moloney and Deputy Manley in their plea for consideration for those resident in areas which are regarded by the E.S.B. as uneconomic from the point of view of rural electrification. Remote areas were referred to. I have in mind a somewhat peculiar case that I came across recently. A certain cottier occupies a cottage situated between two areas which have been completed. The normal charge to this cottier should be 13/8 for two months, but the E.S.B. are looking for a two-monthly charge of over £4. If another cottier adjoining were to take current, the charge would be reduced to something over £2. It seems extraordinary that one cottier prepared to take current should have to pay £4 odd, which is two or three times more than the rent he has to pay for his cottage, situated about 200 yards from the end of one rural electrification scheme and about 300 to 400 yards from the end of another, at the foot of Slievenamon.

There should be some special method of dealing with cases of that description. These people have to meet whatever subvention the Government makes to the E.S.B. They get no return even thought they are compelled to pay so that others may benefit. The people who share this benefit should be made pay some little extra, so that people who are situated as the cottier I have in mind is situated will at least get that amenity.

I should like to ask the Minister to consider very seriously the suggestion made by Deputy Norton in connection with using the organisation of the E.S.B. for the purpose of enabling people in rural Ireland to put in their own water supply. The suggestion is well worthy of consideration. Electricity is a tremendous amenity to people in rural areas. The next best thing, or even a better thing, is the provision of a water supply. If there were any possibility of the suggestion made by Deputy Norton being adopted, it would provide a wonderful service to the people in rural Ireland.

Mr. S. Lemass

In connection with the observations by Deputy Cosgrave and others regarding the rural electrification scheme, it is necessary to remind the House that it was never contemplated that that scheme would be economic, in the sense that it could produce revenues sufficient to remunerate the capital investment in it and the operating charges of the E.S.B. When the scheme was originally submitted to the Dáil it was calculated that, on the basis of the charges at that time, a capital subsidy of 50 per cent. would be sufficient to enable the E.S.B. to break even on the scheme, that is to say, they would avoid losses, if they got half the cost of erecting the network free of cost.

That assumption was also based upon an obligation on the board to supply current under the scheme only to householders where the cost of providing the supply did not amount to more than 16 times the fixed charge revenue from the house. Costs changed and the operation of the scheme became uneconomic to the board in a financial sense, even with the 50 per cent. capital subsidy, and also by reason of the fact that the obligation to provide supply at the standard charge was extended from cases where the capital cost was not more than 16 times the fixed charge revenue to cases where the capital charge was 24 times the fixed charge revenue.

In the sense, therefore, that Deputies have used the term, practically every area developed under the rural electrification scheme, and certainly every area left to be developed, is uneconomic. Indeed, even with the restored capital subsidy for which this Bill provides, the board estimate that they will still lose about £1,600 per year on every area to be developed—the whole of the 184 areas which are still outstanding. It is, therefore, clear that each of these areas is uneconomic in a financial sense, but some are, of course, more uneconomic than others.

The intention is that the board will complete the rural electrification scheme—provide supply in all the 184 areas still outstanding—and it is contemplated that by the time it has done so, it will still have, even with this subsidy, quite a substantial deficit on its rural revenue account. That is something that we have accepted here as desirable in the interests of the residents of these rural areas, that there should be arrangements to brings supply to them, even though it was likely to be unremunerative to the board and even though it was inevitable that it would involve some addition to the charges upon other electricity consumers to enable them to get that supply.

My position in this regard is that I am a strong believe in the theory of minimising ministerial interference with the administration of State bodies like the E.S.B. The E.S.B., being perturbed about the mounting deficit on the rural electrification account, suggested to me that they should suspend further rural electrical development, pointing out that the areas left outstanding are the most uneconomic areas and that the deficit was bound to increase year after year. I expressed the view that the intention of the Oireachtas when the rural electrification scheme was approved here in 1942 was that it should be completed and that we could not at this stage accept the suggestion of the board that we should suspend operations on it.

The position, therefore, that has resulted is that the board are now going ahead with the completion of the scheme. They have accepted my proposal that their arrangements should bring it to an end by 1962. The capital subsidy has been restored in respect of the areas still outstanding and the whole operation which began immediately after the war will then be at an end. When I say it will be at an end, I understand that there may be some question of going back over the areas to connect up houses that refused to take the supply when the area was being developed and some redevelopment work of that kind will be involved, but, when that has been completed, selling electricity in rural areas will be just an ordinary routine operation of the E.S.B., the same as it now is in urban areas.

With regard to the special service charges to which Deputies have referred, again I want to emphasise that there never was in the scheme an intention that electricity should be supplied under it to persons whose residences were so isolated that it would bring them outside the 16 to one ratio I have mentioned. The scheme as outlined in the Dáil contemplated giving supply only to persons whose fixed charge contribution would be 1/16th of the capital cost of the network and that was extended up to a one to 24 ratio later. In the case of persons who could not get within that ratio where the capital cost of supply to the house was away and beyond what that ratio would permit the E.S.B. to do, the additional cost had to be borne by the householder.

It is true that I advocated revision of that special service charge here some years ago, under the impression at the time, which I mentioned, that the amount involved was a mere bagatelle in relation to the board's total rural receipts. I found on examination of the matter that that was not the case at all, that the cost of abolishing the special service charges was quite considerable and would necessitate a very heavy increase in the cost of electricity to all other rural consumers.

Mr. Norton

It would cost millions.

Mr. S. Lemass

I do not feel that we would be justified in imposing that very heavy increase in the cost of current to other consumers for the purpose of making that change. It is, of course, entirely a matter for the board and I am merely expressing a view now upon the board's decision in that connection.

Deputy Cosgrave asked about the report of the Commission on Atomic Energy. I should imagine that this report will be published fairly soon. It has been presented, certainly. I as Minister for Industry and Commerce, was asked for my observations on the contents and recommendations of the report and I have given them. Presumably, the observations of other Departments are being collected also and some finalisation of the process must be due soon. I do not think, however, it bears very much on this question of future electricity generating policy. It is true that all native sources of power will have been fully developed in about ten years or so, and that further development beyond that stage must imply utilisation of imported fuels or resorting to nuclear energy. All indications are that the most expensive way of producing electricity at the moment is through the utilisation of nuclear power and, therefore, as far as we are concerned, it is out of the question until the technique of using it has been so improved that the costs have come down to an economic level.

We are not interested in utilising nuclear energy for power purposes, unless it is more economic than any other process. In Britain and elsewhere they may have the desire to build up their technique in that field, to become established as suppliers of equipment for that purpose and, therefore, they are willing to undertake the establishment of nuclear plants now, even though the cost of power from these plants is higher than from conventional power plants. We have not got that interest, so we will turn over to nuclear power plants only when it is established that it is cheaper to generate power from them than in and other way. It is to be assumed, and I personally believe, that by the time it becomes a live issue for us, the technique will have so developed that costs will have come down to a point which will make it a more economic process to employ.

Deputy Cosgrave asked about the transfer of employees of undertakings acquired by the board. I think I am correct in saying, from my recollection of legislation passed previously, that all these employees have pension rights now in respect of their prior services with the various undertakings. Some came over with established pension rights and others without them.

With regard to the Fitzgibbon Bridge, the bridge over the Dripsey River, to which some sections of this Bill refer, I took the view, and I think it is the sensible view, that if a very substantial amount of money had to be paid out in any way, it was far better to pay it out to the farmers in that stretch of land rather than to use it in building a very expensive bridge, because the cost of providing a bridge would, for technical reasons, be very considerable. It seemed to me a reasonable proposition to put to the farmers that instead of spending money on the bridge, and accepting that in the absence of a bridge, they may have to travel a couple of miles further to reach the main road, it would be better to pay money out to themselves, and the majority of the people concerned accepted that point of view. Indeed, I think they were very wise to do so. It will represent, for many of them, quite substantial sums of money.

It is true that an action was taken in the courts against the E.S.B. The Minister for Industry and Commerce is not a party to that action, but this Bill does not, in any way, interfere with any rights that may be before the courts. All we are doing here is to empower the E.S.B. to pay compensation. It is a power which, in this particular case, they have not got at this time. There is no provision under existing laws by which compensation can be paid because of the removal of a public bridge or public road. There is power to pay compensation where a private bridge, or a private road, is interfered with, but, in the case of a public bridge or public road, there is none. All we are doing is enabling the E.S.B. to pay compensation in such a case. If the courts should decide, however, that the E.S.B. must build a bridge, then, of course, the Bill will not interfere with the decision of the courts.

Deputy Norton inquired about provisions in the Bill relating to membership of the Oireachtas. For a long time past, I have had the feeling that the E.S.B. was in a unique and undesirable position in that regard. Of course, it was the first of these State organisations to be set up here. At the time the legislation establishing it was being framed, not much thought had been given to these matters and, because of certain pressures exercised in the Dáil, the then Government inserted this provision in the Bill, precluding members and employees of the E.S.B. from seeking election to the Oireachtas.

As Deputies know, the desirability of that provision was questioned in connection with later organisations. At least, it was believed that it was wrong to prevent anybody by law seeking election to the Dáil, while it might be reasonable to prevent a member of the Dáil belonging to such organisations. In most other cases, the law has been changed around to prevent members of the Dáil being employed by these bodies, and we are now putting the E.S.B. in the same position in that regard, that is in the same position as other State organisations. As Deputies know, there is no similar prohibition on C.I.E. employees and employees of other organisations of that kind, and I have felt that the C.I.E. practice was the desirable one, and it is the C.I.E. practice I am trying to get established in the case of the E.S.B.

That practice means that if a C.I.E. employee is elected to either House of the Oireachtas, he gets leave of absence from his employment during the period he acts as a member of the Oireachtas, and he will be entitled to go back to his employment if he ceases to be a member of the Oireachtas. I have mentioned an amendment which I am prepared to introduce on Committee Stage, an amendment which will deal with the question of pensions.

Mr. Norton

The amendment will preserve existing pension rights?

Mr. S. Lemass

Yes. I did mention in that regard that certain complications would arise in the case of a member of the Oireachtas who qualified for a pension by holding a Parliamentary Secretaryship, or a ministerial post, which will also have to be dealt with.

With regard to E.S.B. fisheries, I have a personal point of view on this matter which, perhaps, is not fully shared by my colleagues. I think it is wrong that the Minister for Industry and Commerce should, directly or indirectly, have responsibility for fishery policy. As matters stand, the E.S.B., being entirely responsible to the Minister for Industry and Commerce for the discharge of its obligations under the Acts, and having fisheries under its control, deals with the Minister for Industry and Commerce in connection with these fisheries. The management of these fisheries should be a matter for discussion and arrangement between the E.S.B. and the Minister for Lands, rather than the Minister for Industry and Commerce.

Deputy Russell says that fisheries should be taken away from the E.S.B. altogether. I would personally not see very strong objection to that from my point of view as Minister for Industry and Commerce, but I would have, I think, to insist, if such a policy were adopted, that the electricity interests were superior, and that if plans for the development of fisheries were likely to interfere with the generation of electricity, they would have to be modified so as not to interfere in that way.

However, I do not think the Department of Fisheries want to go as far as that. I think they will be satisfied with an arrangement under which the management of the fisheries by the E.S.B. can be brought into conformity with general fishery management practice. There is a certain amount of argumentation going on in that regard, and if the results of that argumentation are not ready for this Bill, I will have them in another Bill, which will be coming along very soon, dealing with the provision of capital for the purposes of the E.S.B.

Deputy Cosgrave paid well deserved tribute to the two whole-time members of the E.S.B. who retired last year, Dr. McLaughlin and Mr. J.M. Fay. I should like to join in that tribute. Both members spent a very long number of years as whole-time executives of the E.S.B. and they contributed greatly to its successful development. There is now a problem obviously arising in connection with the future form of the E.S.B. The chairman, Dr. Browne, will be retiring, on grounds of age, in a couple of years' time, and clearly we have to consider not merely the question of personnel of the board, but also the future form of the board. That is a matter which is having attention at present.

It is true that while the E.S.B. is a very large undertaking, calculated in terms of capital investment and scale of operations, it is not as complicated an undertaking to manage as one with a greater diversification of interests. Nevertheless, it is obvious that we must have some system of control which will ensure that the organisation is properly directed and that the interests of public policy are served throughout in its operations. These are matters which are under consideration at present and in connection with which it will be necessary to take decisions, say, within a year or so.

Mr. Cosgrave

It is not proposed to do away with part-time membership?

Mr. S. Lemass

No. I would not contemplate that at all. It may be that some development of that system might be decided upon. The board is not at full strength at present and that will be the position until these issues of policy are resolved.

Mr. Norton

Would the Minister care to express an opinion in regard to piped water supplies?

Mr. S. Lemass

I am quite prepared to agree with Deputy Norton and Deputy Loughman that one of the most useful services that could be provided for rural dwellers is a piped water supply. I should not like to express, off the cuff, an opinion as to whether the E.S.B. organisation is the best means by which that service could be provided. I have not given any thought whatever as yet to the financial problems in connection with it.

Question put and agreed to.

Committee Stage ordered for Wednesday, 19th November, 1958.

Mr. S. Lemass

I have some amendments. I am not quite sure if they will be completed by then.