In any event, the outcome was going to be a further decline in the agricultural population. I do not know whether it would be as serious as this newspaper makes it out to be but if the three Ulster counties and the whole of Connacht have at least twice as many people employed as what is called the optimum number, then this drift which is already marked by 207,000 people in 30 years will be very seriously increased.
I do not know what it is intended to do in regard to the people who are on the land and how occupations are to be found for them otherwise. Industry was, of course, the way in which these people were to be occupied. We had the famous plan for the 100,000 workers set out in great detail by the Taoiseach when he was Minister for Industry and Commerce and a couple of speeches ought to be quoted at this time. Speaking at Graiguecullen, County Carlow, in November, 1956, he said:
The policy was designed to secure that in five years capital investment would be extended until jobs were available for every boy and girl leaving school as well as absorbing those who are employed at present. These proposals still stand and represent Fianna Fáil's idea of how national affairs should be conducted.
Earlier than that, in April, 1956, he said that his proposals for a full employment policy still stood and that nobody had attempted to show any serious defect in those plans. The plans were there to put 100,000 people into employment. The result, as appeared from the Minister's speech, if I have not to offset any part of this figure because of a further decline in agriculture, is that there are 56,000 fewer people in employment than there were in 1955 and 38,000 fewer than there were in 1956.
One has to consider these figures in relation to the immediate future and particularly in relation to our application to become partners in the European Economic Community. There are two difficulties there: one is whether we shall gain admission to the group known as The Six. There should have been no doubt about that. If policies in this country, both in the international sphere and at home, had been conducted on rational lines, it should have been quite easy to gain admission. At the moment, we are facing the position in which, at the end of the football season, some teams find themselves relegated to the second division. It looks to me as if that is possible. I note that in speeches made now by Ministers in this respect, they do not say "when we join" but "if we join" the Community. There is a certain note of doubt creeping into the voices that were once so shrill in praise and hope for the future. The possibility is there that we shall be playing in some minor league competition next year and not be allowed into this Community we aspired so keenly to join.
If we are admitted to the European Economic Community, what are the prospects? There were plans for having 100,000 new employees. This Government started to put the plans into effect, I presume, in 1957. Before that, we had, when in Government, set up the Industrial Development Authority and inaugurated on good lines the idea of capital development plans. In two Acts, the Finance (Miscellaneous Provisions) Act of 1956 and a later Act, we had inaugurated this programme of benefits and incentives to those who came into this country to provide industrial employment and to manufacture goods for export.
As I say, the plans were there. We had given the authority; we had produced the legislation and made the thing easy enough. A very strong team of civil servants was recruited to tell the Government in a pamphlet called Economic Development what these plans actually meant. They certainly had the best provision any Government ever had in the way of authority, in the way of literature in the matter and in regard to getting the finance necessary to put these plans into operation. The result is that over a number of years, production may have been going up but certainly employment has been lagging very seriously behind.
Supposing we are in the European Economic Community, the big change will be that the two great marketing areas where we had privileges will no longer be privileged for us: the home market which has been kept for manufacturers here by tariffs, quotas and other protective measures, and which will be thrown open to very strict competition; and the other market in which we had great preferences, the British market, the market which we were never able fully to supply even with preferential treatment, will be open to great competition and we will find ourselves struggling against the other members of the Six who will have no tariffs on the goods they manufacture crossing the national border into England. Those two considerations in themselves are sufficiently frightening.
Let us see how industrialists are facing up to these matters. One Labour Deputy referred to a statement made and reported in one of our papers of the 14th of this month to the effect that Irish industrialists had abused their privileges and that there were firms and even industries with their heads still firmly stuck in the sand. Although that gentleman has often been writing very optimistic articles as regards the future, he certainly, as far as this article was concerned, came off that perch. There is another gentleman who is also a signatory of the Report of the Committee on Industrial Organisation. The comments made there are certainly not the most inspiring from the point of view of anyone who wants to have an optimistic outlook on this country. There is apparently one person, however, who knows what ought to be done in industry, and who has said so. A letter was written to the Irish Times on 14th May by an individual who signs himself “Joint Managing Director, Navan Carpets Ltd.” He writes, first of all, to complain against the suggestion that was made in Galway by an economics professor there to the effect that
the best way to prepare Irish industry to take its place within EEC is to make immediate and drastic reduction in the present tariff protection, and wait to see how much damage it will do.
Of course, that was not the purpose of the suggestion at all. It was to stiffen people up, get them out of the flabby way of depending entirely on complete protection, to enable them to meet some little competition before they had to meet the blast of full competition later on.
This letter continues:
This is an amazing suggestion, and would surely produce the comment from future historians that "the operation was successful but the patient, unfortunately, died."
I take that to mean that this industrialist had the view that, if any competition were allowed here, the industrial group here would die; that would be the patient who would have the successful operation performed, but it would mean the patient's own death. The letter continues:
Every responsible industrialist in this country knows very well that the time is surely coming when our home industries will have to compete on equal terms with any in Europe. This should not, however, cause the deep gloom which both Dr. Ó Nuallain and Mr. Raymond Crotty have infused into their lectures. Surely—the letter says— the technician, the accountant, and the industrialist can find some measure of their problem, without having to turn to the economists to prescribe suicidal experiments of the kind suggested.
The next paragraph startled me:
Whether or not an industry or an individual firm can compete is not as much a matter of opinion as many people think; in most cases the competitive ability of a manufacturer can be reduced to mathematical terms, and very often into terms of simple arithmetic.
I wish we could get that formula given to the Minister and, by him, given publicity through this House so that the public as a whole might be made aware of the fact that we have some measure, apparently, of testing competitive ability that can be expressed simply in terms of arithmetic.
Having said all that, the letter goes on:
Many industrialists have measured their problems in this way, and are taking active steps to put themselves in a position to meet the challenge when it comes.
The time left at our disposal for "readaptation of our industries," to quote Dr. Ó Nuallain, is being used by all far-sighted industrialists for this purpose; and this, surely, is a case for continuing protection for as long as reasonably possible, so that the fearful injury our economists visualise might be avoided altogether.
A strangely unbalanced letter because it indicates, first of all, that industrialists are alert, have measured up their competitive ability, are not much disturbed by that, and, yet, the claim in the end is to continue protection for as long as possible to enable these industries to struggle along for the number of years before 1970. I take that letter as typical of a great deal that has been said, and is being said, in the country since the Common Market became a topic for discussion at functional dinners. I have never found any Minister who hinted there was any possibility that our industries were not going to survive. I have heard Minister's expressing their confidence, whatever that may be worth, in the future of Irish industry.
I notice that the nearer one gets, so to speak, to the roots of the matter, the nearer one gets to those who are interested in employment, to those who are in trade unions or associated with trade unions, and who are very much concerned with how trade unionists may fare in the coming years, the nearer one gets to those, the greater one finds the sense of responsibility, and the greater the realism. I have noted comments from labour leaders, one to the effect—and the phrase has been repeated; it is not a phrase thrown off casually at a dinner —that many Irish firms in most industries and all firms in some industries will go to the wall.
I have seen another comment from an economic adviser to labour that there is a bleak future ahead for Irish industry and there is likely to be great redundancy. Another trade union representative said that many of the people who had established themselves here in industry could pack up their bags and leave very easily, without leaving much in the way of losses behind them because they had been so favoured by Government grants, and everything else, they could have recouped themselves any expenses that might have been on them in the early stages for bringing plant and machinery into this country.
Recently, there has been this booklet, the report of the Committee on Industrial Re-organisation. Before I deal with it, I go back to the letter writer to the Irish Times:
Many industrialists have measured their problems in this way, and are taking active steps to put themselves in a position to meet the challenge when it comes.
Irish industrialists, we are to gather, are flexing their muscles and looking for a chance to show their form, talking in terms of the challenge they are going to meet, and quite confident that they are going to meet it, and the Minister is helping them in that particular viewpoint.
I take this booklet now. There is an air of urgency, almost of panic, about it. In one paragraph, they pose themselves certain questions. They ask whether further Government aid is required. In paragraph 10, page 7, the question is put:
Is additional aid needed? If by this question is meant: could the necessary changes be effected without additional aid, then the answer may well be “yes”. A more important question is: would the necessary changes be undertaken by a large enough proportion of Irish industry and in good time without additional aid, and the answer to this question is, in the Committee's view, “no”. There appears to be a general reluctance on the part of the majority of firms to act in the matter of adaptation, coupled with an expectation (though that may be too strong a word) that aid will be forthcoming. We conclude that additional aid will be necessary if valuable time is not to be lost in preparing Irish industry for freer trade.
The opening paragraph struck a note of gloom, of course:
Irish firms and industries will survive under free trade only if their products are competitive in design, style, quality, delivery dates, marketing techniques and price with those available from other countries within the EEC. It would be unwise to assume that local patriotism, consumer ignorance, market frictions, permissible restrictive practices or any other consideration will modify this conclusion significantly.
The opening sentence of the second paragraph is:
In their present state, many Irish firms and industries could not survive freer competition from imports.
I put that on a footing with the opinion of the trade union leader who said that some firms in all industries and all firms in some industries will go to the wall.
At a later stage, at page 8 of the booklet, it is stated:
It would appear, however, that relatively few firms and industries are at present taking decisions designed to prepare them for freer trade.
Having opened on that note, they end that paragraph by saying:
The period within which it may be possible to give preventive assistance might well be very short.
Paragraph 12 faces reality:
When the tariff reductions reach the point where the remaining tariffs no longer afford effective protection, Irish industry would be very vulnerable if still in the throes of re-equipment or of any other important form of adjustment. When that stage is reached, it is essential that re-equipment, etc., should be fully effected—perhaps, indeed, that the firms should have plant and equipment which has been substantially written down.
These two paragraphs must be read together because the second paragraph is to the effect that if the firms are caught, so to speak, in the process of re-adaptation, then they will suffer. But the warning is given earlier that "relatively few firms and industries are at present taking decisions designed to prepare them for free trade". At the end of page 11 and over on the top of page 12, it is stated:
The answers to the C.I.O. questionnaires will give some indication of how the tax free export profits have been used by firms—that the behaviour of the level of industrial investment up to the end of 1960 does not suggest that much re-equipment has been taking place.
A pamphlet was got out with a certain amount of urgency and almost a note of panic. It says that firms are not preparing; that firms could adapt themselves without Government aid but will not; that few firms can stand the free competition they will meet under EEC conditions, unless they bestir themselves and get into a better condition. Then it says it does not appear as if much re-equipment has been taking place. That is the situation in which we drift into the Common Market, if we are allowed in.
I cannot feel optimistic about the future when I get that comment by a group set up in order to consider what our industries are doing. I think it is a terrible situation that, even if we are left alone—without Britain or ourselves joining the Common Market —we look forward to another 100,000 people being swept off the land and that industry, which has not done very much recently, is to provide for these.
Looking at these figures with regard to rural depopulation, it seems we shall have to re-write our history books in regard to more than one matter. We have been urged to do that with regard to the old time situation. It has been urged that the old slogan about Britain and our enemies should disappear and that a more rational type of history book should be written. We shall have to do more than that. A good deal of our history is a condemnation of many of our landlords. It seems we owe a lot of these people an apology. I do not think they were as effective in depopulating the countryside as what has happened since 1926.
Those 6,000 persons said to have gone into industrial occupation in the last year depend, to some extent, I suppose, upon the Shannon Industrial Estate. I gather from newspaper comments after the recent excursion down there that the numbers occupied there have at last struggled up to the height of 1,200 people. There was a time when the Shannon Industrial Estate was stated to be likely to erect a new town of 50,000 inhabitants. It was said at one time that we would have a second Limerick on the outskirts of the airport. Our ambitions are more modest nowadays. We have been chastened by our experiences. I think 1,200 is the highest number I have seen quoted as employed in manufacturing industry. I am not talking of those employed on the building of factories. Subtract that figure of 1,200 from the 6,000 for the whole country. It means that about 4,800 people have found employment in industry other than industry associated with Shannon Free Airport.
A tremendous number of incentives are offered to industrialists to come here and manufacture for export. I think sites of land are given free. There are grants for plant and machinery and there is a remission on profits if the profits are derived from export. These are all incentives of the type that one German Minister has described as export subsidies.
I have questioned several times and a Labour Deputy has questioned in a Parliamentary way the future with regard to these subsidies. There are escape clauses in the Rome Treaty. It seems to me that if we are always looking for the escape clause it shows our weakness. However, if it has to be that way, it has to be. But, while there are escape clauses, the principle of the European Economic Community is quite clear. They want free trade and bona fide free trade. That means that devices such as tariffs, quotas and keeping goods out will have to be abandoned after a certain number of years. Furthermore, the free trade contemplated by the Rome Treaty does not allow for subsidies for export. That is not free trade.
Take even the 5,000 persons or so who may have got into industrial occupation in the past year. I wonder how much of that employment depends upon anything in the nature of an export subsidy. I can think of only three types of firms in this country, when I am thinking in terms of export. There are some, a few, very big firms who have been here for a long time. I think they have found it possible to produce goods for export in competition with the firms in the areas to which they send their goods. These are people who are not protected at home and, as far as I know, they are not getting any incentive towards subsidy. The number of firms that rank in that group can be counted on the fingers of one hand; maybe the number goes into double figures though I doubt it.
Next we have a group of industrialists here which, having a whole protected market for themselves, are able to put surplus production into export. They can achieve the same measure of success in that way. One asks how will those firms adapt themselves to new conditions when the home market is no longer protected for them. If the home market protection goes, and the main basis at the moment for their chief production weakens, I wonder if there is any estimate of how those people are likely to fare.
Then there is the group of people who were induced to come in here by certain incentives, who came in here to manufacture goods for nothing except for export. I wonder what is the likelihood of these surviving if, as is possible—I do not say probable—these things are counted as subsidies and therefore are condemned under the terms of the Rome Treaty.
We have figures. I hope the Minister will explain the difference between those 149,000 and 155,000 which I cannot relate either to the figures in the economic pamphlet dealing with transportable goods or to Table 16 which refers to people in the branches of non-agricultural economic activity. Let us take that figure. Let us take the figure relating to those employed in the manufacture of transportable goods or those employed generally in industry. Have we any estimate of how many people are employed by firms who have no protection at home and who do not require and who do not get subsidies for export? Some fraction of this group has its employment through those firms. It would be very small, I would say.
Take the second group. What proportion of our whole activity occupies people in industries which depend on home production which is likely to go and which most certainly will go if we get into the community? What is the remedy?
How many people are employed in industries which are entirely dependent on incentives given to them because they are entirely or almost entirely manufacturing for export? It is only when we see the figures for this type of industry that we shall be able to understand what the future is for industry in this country.
I notice that the Minister said recently—maybe in this debate—that the Government accepted the recommendations of the Committee on Industrial Organisation. I do not think these recommendations carry one very far. However, whatever they are, it is good to find that the Government are alert enough to the situation to promise this committee, rather late and hurriedly set up and late and hurriedly and almost panicky reporting, to accept whatever is contained in the recommendations.
