Before the interval, I adverted to the different principles operating as far as internal and external transport are concerned. On the question of external transport, Irish Shipping do not to any extent serve this country but the air services do, to a limited extent, serve Irish nationals. I said and I want to repeat it, that it is a great pity an apparently efficient company like Aer Lingus should be put in a false position before the public.
We hear statements from publicity officers and important people on the boards of these companies to the effect that they have made operational profits and the public are rather relieved until they get a shock to find these profits are not calculated by any business standards. That presents the company in a false light to the public. It would be far better to let the public know that just as we regard Irish Shipping as a prestige service so we should regard the air services—that we frankly recognise they will not pay their way or that at least if they do it will be the surprise of the century. It is wrong to have the accounts presented without paying attention to the capital involvement or how that capital is met. Because of that, a bad situation has developed.
Let us take a look at the relevant portion of the Minister's 48-page memorandum of introduction to this Estimate. On page 12, speaking of Aer Lingus, the Minister said:
The accounts of the company for the year ended 31st March, 1962, show that the Company earned an operating surplus of £56,000 as against £277,000 in 1960-61. Total Revenue increased from £4,970,000 in 1960-61 to £5,684,000 in 1961-62, but this was more than offset by increased operating expenditure which amounted to £4,693,000 in 1960-61 as compared with £5,627,000 in 1961-62. The results of the company's operations in 1961-62 can be regarded as satisfactory in view of the increased competition encountered in the period both on the cross-channel and Continental routes.
To make the accounts show an operational surplus without bothering about the capital involved is dishonest. It would be so regarded in any business concern which would have to pay attention to whatever capital was involved, whether in the form of outside borrowing or share capital. They must make provision for repayment of capital and for the payment of interest. This failure to show in the accounts the capital involvement carries forward the deception of the public.
We have then the final revelation with regard to the accounts when the Minister admits deficits on the airports but shows operational profits for the airline companies. The Minister had to admit that there were deficits because he had to add in such things as pension provisions and provisions in respect of the airports.
When we come to Aer Lingus, we are told an operational surplus is earned—£56,000 as against £277,000 during the previous year—and people reading that are very happy, even though they might say: "Maybe the company have not made as much as in the year before but at least they have made money." Nowhere in his statement does the Minister say Aer Lingus is in the red. Putting Aer Lingus in the red may not be anything we should be surprised at. I know Aer Lingus—I do not know Aerlínte, never having travelled on the Atlantic route—and I am always struck by the efficiency of the people you meet on that service. In fact, there are few companies where one would receive more courtesy and greater efficiency but they should not be presented as making money when they are not making money and when they are depending on the taxpayer. That is a misleading statement for the Minister to make. At page 13 of his speech he says:
The accounts of the Company for the year ended 31st March, 1962, show that the Company earned an operating surplus of £200,000 as compared with an operating deficit of £94,000 in 1960-61.
Anybody reading that and reading what was said about Aer Lingus would say that between the two, they had changed a deficit into a surplus.
The statement goes on:
The total revenue earned by the Company in 1961-62 was about £4,167,000 as against £2,463,000 in 1960-61 and this very considerable increase reflects the extensive development achieved in the Company's traffic during the year.
There are 48 pages in this statement which shows that Aer Lingus and Aerlínte are not making money according to business standards. If this House were asked: "Do you insist on the company making money? Do you insist on its measuring up to ordinary industrial or commercial trading standards?", we might say: "No. We shall give them a certain amount of rope. They are very hard pressed by competition. It is not a commercial service and we shall allow them to run a deficit, provided it is not over a certain amount." Two attempts have been made to mislead the public which will not redound to credit of Aer Rianta which controls these two companies. Such items as capital and pension liability are things which must be counted in the world in which we live, unless this Parliament says: "We shall not ask them to meet these charges. We shall take it out of the taxpayer's pocket." The framework in which this whole thing has been put indicates that operationally the two companies are making a profit. That is completely wrong.
I said the Minister's memorandum ran to 48 pages. My calculations make that 14,000 words. It is an amazing document for what I call a "phony" Department. This Department is described as the Department of Transport and Power. It is now transport, power and tourism. In dealing with Aer Rianta, the Minister makes what is to me a revelation. This Minister for Transport and Power, who has now added to himself tourism, has got the Minister for Finance to subscribe £275,000 by way of share capital for investment by Aer Rianta in Irish and Inter-Continental Hotels, Limited. The statement goes on:
The money is being used towards the construction of hotels in Dublin, Cork and Limerick and these hotels will provide much needed additional first-class tourist accommodation, the lack of which at present is undoubtedly retarding the air companies in their efforts to attract more tourists to this country.
The situation is now that the Minister for Transport and Power is not so much interested in transport as in attracting tourists. In order to do that, he has to go into the hotel business. I hope I have made the members of this House familiar with the work of what is called Parkinson's Law, the groundwork of that being that if a person has time enough, he will occupy all the time on a particular job, that he will extend the time he would use on that job until all the time available is used. That applies also to personnel.
Here we have a completely unnecessary Minister for Transport and Power doing what used to be done by the Minister for Industry and Commerce. People looking through this memorandum will see that as far as transport and power are concerned, the Minister has handed over all his obligations and duties to boards. You have Aer Rianta, Aer Lingus and Aerlínte; you have the people under Aer Rianta who run the airports. You have the board of Irish Shipping, Bord Fáilte and a whole lot of subsidiary or ancillary boards that run tourism. Then there are the ESB, Bord na Móna and CIE.
The Minister having handed over all his duties to various boards, found he had nothing to do so he developed a line on tourism. Even tourism does not occupy a man who is doing even a 40-hour week job and now he is going into hotels. I do not know where this will stop but it is Parkinson's Law working entirely to the satisfaction of Mr. Northcote who first wrote about it. The man who has time on his hands will find ways of utilising that time and you will get the establishment of associations and amalgamations of associations which will give him some interest in life if they do not give him some occupation. The Minister is now in the hotel business because, as he says, the lack of good hotels is retarding the air companies in their efforts to attract more tourists to this country.
Let us be honest in this matter. Let us say the Taoiseach was wrong when away back in 1959 he said prestige did not matter, that tourism did not matter, that we are going to get cash profits out of the operation of the transatlantic airlines. Let us abandon that but it has got to be done frankly. We are no longer adhering to that standard. We are now going in with the ordinary rut, with the people who are losing money in all-out competitive effort to attract travellers. When we see the Minister for Transport and Power getting into the hotel business, there is no knowing where it will stop. There ought to be some limitation put upon it.
We have come to the point where there ought to be some clarification given. If it is not given in the clarification of the accounts of the airlines, of Bord na Móna or different other boards, at least it should be given by the Minister. We are the shareholders representing the public. The Minister ought to explain everything honestly to us as the director of a board will explain to the shareholders. He has not done that and these 48 pages are mainly occupied in trying to evade the significant fact that emerges from this document, that, with the exception of the ESB, all the State companies are losing money and losing money judged by ordinary business standards.
It is interesting to see the division of the Minister's speech. He spoke about 14,000 words as well as the 22 columns he spoke about CIE on 14th November. Take the 48-page memorandum of yesterday. Four thousand five hundred words are devoted to aviation including the Shannon Free Airport; 2,500 go to shipping; 3,000 to tourism. Therefore 10,000 of his 14,000 words are occupied with aviation and shipping and there is the mass of verbiage with regard to tourism, including hotels. Electricity which is the only really profit-making concern is disposed of in 1,000 words. Turf gets another 1,000 words; coal, whatever it means— I have not been able to analyse it myself properly—gets another 1,000. CIE gets a quarter of a page because the Minister says he dealt with CIE at length on 14th November.
Again I want to repeat that the division was lucky. We are told CIE must pay its way in all its branches. Airlines, no; shipping, no; turf, no; other things, no. No such rule was put upon them. They could be subsidised, and apparently the public are to be asked complacently to accept subsidising those concerns. I think they might if the facts were disclosed to them, but it is completely wrong to have this parade of an operational profit when they are sinking deeper and deeper into the red every time, in fact.
I notice the Minister's evasion on page 15 in regard to air discussions with America. I know very well from the past two experiences I have had in Government that the authorities in America are pressing hard to be allowed to fly into Dublin and not bother with Shannon. Their advances, and aggressive advances, were repelled in 1950, and again in 1955. Apparently the threat still remains and the American companies want to be allowed to by-pass Shannon and fly into Dublin. It has been put off for the time being. The Minister said:
The agreement which regulates air traffic between the two countries provides that a revision of the agreement may be requested on 60 days' notice by either side and the US Government have reserved the right to re-open the question in accordance with the agreement.
In other words, the Americans are still persisting in their view that it is wrong to make them use Shannon and that they should be allowed to fly into Dublin. We have not got the better of that argument. We repelled it twice in my time, and apparently it has been repelled again, but the threat is still there.
After that, the Minister comes to the "great national asset," as he called it, of the Shannon Free Airport Development. Again, we should get a bit of sanity and some balance in our approach to this. It has been hailed as a spectacular matter, a revolutionary concept, as the Minister calls it on page 17. We have created a great national asset. I wonder? I read an account of comments mainly by the person chiefly associated with the Shannon Free Airport Development in which he told, in a hysterical moment, that he contemplated a new town with 50,000 inhabitants out at Shannon. That is just the population of Limerick, or quite close to it. He meant, not that he was going to shift Limerick out to the Shannon area, but that there would be a new town equal to Limerick out at the Airport. That is the greatest nonsense.
Over the years, I have asked questions—timely questions, not put in too hurriedly—and in the end I got the revelation that 1,300 people are now employed there as compared with 700 a year ago. The actual value of wages and salaries was of the order of £½ million. That does not matter. If they are not being employed economically, we could give them £frac12; million to do nothing. It would be better if they were employed at something, no matter how futile it may be. I am not saying that the work at Shannon is futile but I remember the hysterical forecasts about a town of 50,000 inhabitants after three or four years, and now I find that 1,300 people are employed there.
A Deputy in the Labour benches drew the attention of the House to the fact that in the early part of the year the unions had to interfere to prevent the exploitation of child labour by some of the companies operating in the free area. That, I hope, has been stopped, and either juvenile labour has been placed in a proper condition, or there is adult labour with adult conditions. It is now hoped that by March, 1964, that is, March next 12 months, that the total number employed will be 2,000 people.
I have tried, vainly, to find out what is our investment figure. A figure is given but I do not believe it. It says our investment is £2½ million but I think it is much more. An investment of £2½ million which in the end might produce an employment figure of 2,000 in another 18 months or so, does not seem to me to be the most profitable type of investment.
I am very anxious about another matter. I have refrained from raising it, but I am entitled to raise the point. We have applied to go into the European Economic Community, the Common Market. The application was made on behalf of the area of jurisdiction of this State, the 26 Counties. We have to leave out the Six Counties. They will go in as an appendage of Britain. They are cut off from us and are beyond our control.
What will be the situation of the Shannon Industrial Estate if Ireland gets into the Common Market? Will that area get in or will it be excluded? It makes a big difference. If the area is included and we are inside the European Economic Community, of course goods that come to us from outside that area will have common external tariffs so all the brouhaha about allowing goods in free of customs duty will disappear. On the other side, whatever goods are manufactured—if any—or put together in the Shannon Industrial Estate will have to face other countries with the conditions that apply to the Common Market area, if we are in the Common Market.
The position of the Shannon Industrial Estate seems to be somewhat anomalous. The Minister has told us that we must keep our eye all the time on the possibility of being inside the Common Market in a few years. He must have considered that question and be in a position to advise us what will be the situation of that estate under conditions where we are in the Common Market and under conditions where we are outside it. Either way it seems to me it has not much future.
The Minister talked about shipping. I have already mentioned that it seems to me to be absurd that we should ask the heavily-laden taxpayers to subsidise our ships which are sailing the Seven Seas and hardly ever put into an Irish port, hardly ever carry a cargo consigned by a native of this country or to a native of this country. The vast bulk of their carrying is between people who are completely alien to our country and whom we should not be asked to subsidise. I presume the answer will be that it is insurance and that we require some shipping service in case war breaks out again. We faced that situation before.
In 1939, when war broke out, we had four or five vessels of our own and in, I think, three months after war broke out, we had lost those four or five vessels. Whatever the conditions under which they had come to us, the real owners were able to take them back from us. In three or four months, certainly before the New Year of 1940, we were left without a boat of our own on the seas. We did buy a certain number of old hulks which no one else would buy. We were in parlous circumstances and we had to buy anything. We bought at panic and famine prices and we sent those vessels looking for our provisioning.
Of course, everyone realised that boats were worth nothing by themselves, unless you had battleships to convoy them. We had no battleships but we were convoyed. Neutral as we were, we got the protection of British naval might to get in whatever small supplies were brought in by the few vessels we purchased at panic prices at the start of the war. I do not know whether the same argument will be used, that this fleet of ours, all these boats of ours called after trees, are there only as a safeguard. I do not think they are worthwhile as a safeguard, but maybe there is another view.
I should like to hear who are the shrewd businessmen or politicians who advised the Government it was worth while having so many ships travelling the Seven Seas and hardly ever coming home, just because we might want them in case of war. A Deputy who spoke from the Minister's benches today said he had been aggravated by the shipping services between this country and England and asked why did the Minister not do something about them. He put up that pathetic plea I have listened to so often: we have got the ships, we even have the yards to build these ships, we have the technique, so why do we not call back these boats from Hong Kong and the American and Canadian ports and put them on the traffic between this country and England? I should like to hear the Minister's reply on that. I have often considered the step. Personally, I do not think it is possible. I do not think what we have in the way of ships would be worth while on that service, but maybe the Minister has other ideas. If he has, he ought to attend to the appeal of the Deputy and put our boats into commission on the cross-Channel trade. We have refrained from doing so for so long that there must be a reason why we have not done so. I should like the Minister to explain why.
The Minister now becomes quite candid and clear and says that while Irish Shipping showed an operating surplus of £279,000 compared with £238,000 for the year ended 30th April —he does not stop there as he does in regard to the air services but goes on further—the depreciation of the fleet for the eleven months amounted to £691,000 and the commercial loss for the period was thus £409,000, compared with a figure of £515,000 for the previous 12 months. What is the principle that allows the Minister to tell us the real losses on shipping, counting all these things in, and stops him from telling us the real losses on airlines, because there would be a real loss if he deducted all these matters he refers to, such as depreciation and so on? There it is. We have one mind towards CIE, a different mind towards the airlines and a somewhat different mind when it comes to Irish Shipping.
The Minister refers to the Verolme Cork Dockyard and says: "With the establishment of the Verolme Cork Dockyard, the building at home of deep-sea vessels for the company is now also possible." I asked questions about this dockyard in July, 1961. I asked the Minister for Finance if he would state (a) the amount of external capital invested in the Cork Shipyard Company (Verolme Cork Dockyard Limited) and (b) whether the commitments of the Industrial Credit Company Ltd. to the said Dockyard Company had increased beyond the figure of £4.6 million which was stated to be their commitments to the said Dockyard Company on 31st October, 1959, by the Chairman of the Industrial Credit Company. The short answer I got to that was that I was referred to a question on 14th December, 1960, and the Minister had nothing to add.
The question asked in 1960 drew the reply that the Minister did not think it desirable to say what the State commitments were, even though a few months later Dr. Beddy presided at the general meeting of the Industrial Credit Company and said that the Irish commitment was £4.6 million. The Minister for Finance said he could not give me that information; yet the Chairman of the Industrial Credit Company gave that information to the public. I have refrained from putting down any further questions to the Minister, because it has been complained of by many people that the Minister for Transport and Power and the Minister for Finance will say: "We will not give it to you. It is not right to disclose such information. We will not give it to you in any event." Dr. Beddy gave the figure of £4.6 million, and I have not found he has made any improvement on that figure.
The general view is that our immediate commitments to the Verolme Yard are in the region of £6,000,000 at this moment, but it is impossible to get information on the matter.