Last night, I was speaking on this Budget but I am glad to have the opportunity of speaking this morning. One of the misfortunes of Dublin Deputies is that when they speak here, they are really speaking to the people and not to the Dáil. Dublin Deputies just get a few lines in the newspapers, whereas the country Deputy can cut out his whole speech and get it all printed in his local newspaper. I am not complaining.
Committee on Finance. - Resolution No. 14—General (Resumed).
Debate resumed on the following motion:
That it is expedient to amend the law relating to customs and inland revenue (including excise) and to make further provision in connection with finance.
You are probably lucky.
That is why I am glad to say a few words in the morning, because I hope to get the ear of some of my constituents. The majority of Dublin constituents do not read morning newspapers; they buy evening newspapers. I am being candid about it. There are lots of people who get in here early every Thursday for the same reason. I am supporting this Budget, as I already stated. I did not take long to make up my mind. I think I was one of the first to support it because I saw through the proposal immediately and I saw that here was an opportunity for a Government in debt. The Budget was not balanced. The Government are responsible for the Budget and we were in debt, not through any fault of the Government. If the Coalition had been in power, they would have been in debt and I do not know how they would have remedied the position.
I saw this as an opportunity whereby the Government could not only balance the Budget this year but next year and probably every year, and not only that, but they would be able to meet their many demands especially from people who receive social benefits. One of the most trying things a Government have to do is to try to provide money for the hundreds of thousands of claims for social benefits. It is easy to criticise the giving of a couple of shillings but when you consider the hundreds of thousands of people who have to get that couple of shillings, then it amounts to a huge sum.
In this Budget, the couple of shillings will cost £4½ million. If the Government were to give increases only to the old age pensioners this year, they could have given them 12/- or thereabouts, but if they had done that, they would have given nothing to the people with families, nothing to blind people and nothing to the disabled people. At least it can be said of this Government that when they give increases, they spread them around. Without this turnover tax, how could these increases be given? They could not be given. I understand that the Government need £6½ million to balance the Budget. The greatest moan now is coming from the business people and the politicians who are opposed to the Government. Obviously if the business people were not losing by the turnover tax, they would not moan. If they could pass it on, why would they moan? The fact is most of them know they will not be able to pass it on. For instance, as far as the corporation profits tax is concerned and the betting houses, lots of those people will not be able to pass it on because they will lose business if they pass it on and they will have to pay most of it themselves. That is why they are moaning. Nobody moans who is going to gain.
Last week, I heard a Deputy say that the shopkeepers were going to rob the public. If so, why should the shopkeepers moan about it? There is a lot of untruth in what is said here. One speaker disputing the Budget contradicts another. You have those who say the shopkeepers will charge twice as much and you have other Deputies moaning for the poor shopkeepers. You have the papers this morning—I have a handful of cuttings here—saying that big business is moaning. If that is so, it should be a good thing and the Labour Party should cheer. Over the years, the House was told: Do not put anything on the workers; put it on the people with the money. Quite a lot of this tax is going on those with money. It is extraordinary to have Labour and big business moaning at the same time.
Have you the NFA statement there ?
I believe big business has cause to moan and that the money that will be got from big business will be channelled into increased social benefits——
Everybody will have cause to moan.
——to increase assistance for the farming community and so on. That must happen. Why are we looking for money? It is not to have a good "hooley" here but so as to share it out. What other reason is there? Again, what point is there in asking for increases for everybody without mentioning where the money is to come from? Why moan now when this effort is being made to get the money to give to the people? The biggest moans are coming from the business people.
We are told the working classes are going to lose and if you coolly analyse the Budget, not in terms of this year but in terms of next year, you will see the working classes will benefit from the turnover tax. Lies are being told and things distorted. I heard Deputy Mullen speak of a man earning only £8 a week. We know the average city worker has about £10 a week but that is the type of arguments used. He said that if he had £8 a week he would only get 3/- of an increase if he had three children while he would have to pay 4/- extra in tax and he would lose 1/-. Let us assume the man earns £8 a week. He will get 2/6d. for the first child, no increase for the second but he will get 1/1½d. for the next. That is 3/7½d.
You do not get 2/6 a week——
Let me deal with the matter. Let us be honest with figures anyway. The average worker is now a corporation tenant in Dublin and I am satisfied that if his rent is 27/6d. that is all he will pay, that there will be nothing extra. I am sure there will be nothing extra on his union fee or insurance or any of those things. It can be worked out that he will have to pay only on about 70 per cent of his money, if he has to pay anything. Therefore, it will work out, not at 1/- in the £ but about 4d. in the £ and the truth would be that it would only cost him 3/- or 2/6d. and he will get 3/7½d. and he is not losing.
I cannot see any man with a family losing. A man with no children may lose between 2/6d. and 4/- but who will moan about that? That happens so that the man with the children will get it. There is nothing wrong in that. If a man is not married and has £10 a week why should Labour kick up a row on his behalf ?
Because he is already paying income tax.
That is not the point. This is not money for the Government; but money that is going into the pockets of the unemployed.
No.
I shall prove it. An unemployed man with four children will get 2/6d. for himself and 2/6d. for his wife. That is 5/-. He will get increased children's allowances, 4/6d. a week extra if he has four children, plus 5/-, which is 9/6d. If he is unemployed, he will have £3 or £3 10s. He will pay out about 2/- extra and get 9/6d. extra. You do not need any brains to see that.
You would need to have no brains to see it that way.
Most of the 9/6d. will come from big business and from the man who has no children.
Old age pensioners will get an extra 2/6d. They will pay about 4d. in the £ and as they have only £1 15s. a week or so what more can they pay than 6d. or 7d.? They are getting that increase in a year when there is a Budget deficit, when the Government had to make up £6 million. Is it not quite obvious that if they get it in a bad year they will get it next year and that they will benefit by, perhaps, a complete 2/6d. I expect a good Budget next year and I expect all the people on social benefits to get another increase.
You expected 5/- last year.
It does not make any difference. They are getting the other halfcrown this year. Your policy is to try to prevent it being there. You want it both ways. You want to promise those people increases and at the same time kill the effort to give them any.
We do not want to give it and take it from them again.
A start must be made and this start is being made. It is up to those who can afford it to share with those who need it. There is no other way for people in need to get relief.
That is what Khrushchev says.
Anybody who studies history and the causes of revolution and unrest realises only too well that it is because of the niggardly attitude of people with money that revolution and unrest come about. I was reading a history of the French Revolution the other day and there is a paragraph which aptly applies to this situation. It so happened that in the first year of the Revolution in France, there was a moderate Party in control. The bloody business had not begun. The Finance Minister, Necker, asked the people with money to sacrifice onefourth of all their profits but they refused to do so. The result was they lost all the money, all their property and their heads as well.
You do not think that will happen here ?
We are leading up to it.
There is a sort of parallel in that to the present position here. Let me quote:
Necker was ever bewailing the increase of the deficit; and when the Assembly jealously refused to strengthen the executive for the collection of taxes, he proposed (Sept.) that a "patriotic contribution" should be made by every citizen of one-fourth of his income to rescue the State from bankruptcy.
We are not that bad but there is a parallel situation here. I continue the quotation:
The Assembly was wavering, when Mirabeau's eloquent support carried the measure: "Bankruptcy, hideous bankruptcy is there: it threatens to consume you, your honour, your fortunes—and you deliberate!" Even after this appeal, the patriotic contribution was a dismal failure ; and the first year of the revolution was to close with a deficit of over £7,000,000.
That would be equal to probably £100 million in present-day money.
Both the Assembly and the populace were less concerned about the payment of taxes than the correct phrasing of the Rights of Man.
Like here—talking shop ; writing shop.
After long deliberation these were accepted; but a proposal that the duties of the citizen should also be defined was lost by a small majority. To insist on rights, and shirk disagreeable duties, was the radical defect of the new civic life, fatal to the solvency, order, and stability of the State.
You might as well state that that applies to this House in relation to the Budget.
Is the Deputy predicting a revolution?
Will Deputy Sherwin please give the reference?
Cambridge Historical Series : The Revolutionary and Napoleonic Era, 1789-1850, by Rose.
It could be said that the cause of so much unrest in France was that certain sections refused to pay their just contribution by way of taxes to help the less well-off people. That is the reason why there is a dictatorship in France today. The cause of Communism everywhere is that people with the money begrudge and refuse to make a just contribution. It is those in need and in want who rebel. We have reached the situation here where employment is uncertain by reason of international and economic conditions.
Et cetera.
It is not the fault of any Government. Here is an attempt by the Government here to create the wherewithal, the kitty, whereby the demands from those who are in need can be met. Of course, I can understand the Opposition opposing this measure. This is politics and politics is a game. Although it is supposed to be the art of the possible, instead, it becomes, in so far as many politicians are concerned, the art of looking all ways.
And he knows.
Yes. I ought to know. I know that some members of the Opposition will say that Deputy Sherwin must be Fianna Fáil now. I can assure them that I am as independent as I ever was. I believe that in supporting the Government, I have saved this country from two general elections.
Saved your own neck.
I believe there would have been a general election had any other Government taken power, not only a year ago, but arising out of this Budget, because a Government made up of half a dozen Parties and individuals could not agree to any measures to try to rescue the finances of the country at the moment. They could not agree and it would result in a general election and there would be nothing but election brawls instead of progress. I certainly claim that I made that much contribution.
Is it in order for two Deputies on the front bench of Fine Gael, to be carrying on a conversation sotto voce?
I did not hear the Deputy making a speech.
He has not spoken for years in the House. It is remarkable to hear his voice.
The Deputy only speaks in select company—Harvard, no less.
I have made the point that I contributed to stable Government in the country for the past 15 or 16 months. I said that there would have been two general elections in the interim had I done otherwise. I believe people do not want election brawls by individuals aspiring to power, and nothing else. That is really all that politics amounts to. In regard to my politics, I should like the House and I should like the Opposition to bear in mind that only ten months ago it was my vote that made a Fine Gael Deputy Lord Mayor of Dublin. That is my answer to those who think that I am this or that. I made Deputy O'Keeffe Lord Mayor of Dublin by my one vote. He got 19 votes as against 18 votes for a Fianna Fáil candidate. That is evidence that I am not a Party man of any nature. I believe in doing the right thing. I voted for Deputy O'Keeffe because the other candidate had been Lord Mayor. I voted for him because I considered him to be a decent fellow and had been always pretty straight with me. I will vote for Fine Gael men when I find they are right. I voted for this Government because I found there was no alternative and the country would face calamity, in the circumstances, if the Government were not helped to carry on. The Government have lost money by reason of reductions in tariffs on imported goods, and must lose again in January. The State must carry on. The State has no way of getting money except from those who can afford it.
It is my firm belief that this Budget hits nobody but the people with the money. Deputies can moan if they like. The people who will be paying will be those who can afford to pay. The workers with families will not pay, because there has been an increase in children's allowances which, alone, is costing £3 million. I believe more could not be done this year because the Government have to face up to a deficit in the Budget, have to make up £6 million. When the Taoiseach mentioned moving to the left, I believe he meant that and that is why big business is moaning. I believe next year there will be further increases. If that is so, it satisfies me because I am in this House not alone as a worker but as a fellow resident amongst the old age pensioners and all the rest. I live in the midst of them and would certainly not support any policy here but a policy of stability, on the one hand, and a policy of spreading out the available resources and giving to those in need. That is my policy and my only policy in this House.
Many arguments, without any truth, were used. Deputy Mullen mentioned differential rents and said that if old age pensioners get 5/- they will pay 10d. of it in increased differential rents. That is true but the fact remains that in respect of the last four increases in social welfare benefits the City Manager, on my proposal, decided not to take those contributions into account. So, DR did not take one farthing out of the last four increases in social welfare benefits, on my proposal, because I always look upon this DR business in this way—I approach it in a small way, make demands that I know the City Manager will concede. The politicians approach matters in a big way. They speak in terms of pounds. I went about the matter in a small way and I succeeded. I only mention that because Deputy Mullen suggested that an extra 10d. would be taken out of their 5/-. I succeeded in getting the City Manager not to take the last four increases into account and I am quite certain that he will not take this increase into account either.
I am very pleased in many ways about this Budget because it has allowed the Government to give not merely increased children's allowances to the amount of £3 million but increases also to widows, orphans, the blind, the disabled and those suffering from infectious diseases. It has increased unemployment assistance. It has even given increases to State pensioners. It is spreading the available money all round. In regard to one small group, I may say that I am very pleased that disabled persons are getting 2/6d. They got an extra 2/6d. last year and they are getting another 2/6d. this year. Again, I claim that it was my agitation that secured that increase because the increase to disabled persons does not come into the Social Welfare Estimate. That is why for six or seven years disabled persons did not get any increase in benefits. They were forgotten. I brought that home to the Minister for Health and he admits it was due to my agitation. I make that claim. I am pleased that those people will get something. It is possible to give them something because of the anticipated income which will come from this turnover tax. If you kill this turnover tax proposal, you will kill the social benefits and those people will get nothing next year.
This is a revolutionary proposal. Some people would need to have dictatorial powers to try it; otherwise, they would not dare. The Government are bold enough to dare it and they are right to do so. The way to overcome a crisis is by daring and not by hedging. I am certain the Government are capable of meeting an adverse situation and I know they will succeed. It has been proved that a number of Parties and individuals cannot succeed because the individual thinks of himself first, his Party second, and perhaps the country third.
I have no special regard for the Fianna Fáil Party. I take this stand because I think they are right. I am pretty sure that if St. Peter came in here, he would be abused as I am if he voted for Fianna Fáil. As I said, I voted for Deputy O'Keeffe as Lord Mayor. I will do the same next year if I think it is right, and not because I hope to gain by it. I am speaking under difficulty because I have a bad throat, but I had to say what I had to say. All this passion is being worked up because of the by-election. As I said, everyone thinks of himself and all the lies in the calendar will be used.
I read an amusing article in a magazine a few weeks ago in which a man decided he would not tell a lie for a month. In that month, he made enemies at home, at work and in his neighbourhood, and he decided that in future he would tell lies like everyone else. Politicians tell lies and I am not blaming them, but if I told little lies— and I do not—I would do considerably less harm than a Party man who tells lies. If an Independent tells little lies, he is doing it on his own behalf, but a Party man has to tell enormous lies for himself and his Party.
(Interruptions.)
Order.
No one likes taxation, but there is no other way of getting money except by taxation. It is wrong for the Opposition to appeal to the selfish side of man's nature. We are all a bit selfish and do not like giving anything away, but there is such a thing as patriotism. The people who went out in 1916 and 1921 were patriotic. They did not think in terms of money. They were not mercenary.
As I have said, there is no way of getting money except by taxation. We know what happened in the French Revolution. We have seen how people in France, Spain and elsewhere, in more modern days, begrudged making a contribution to help those in need. That type of thing leads to communism and revolution.
I am satisfied that the people who need social benefits will benefit by these proposals, and I believe they will benefit threefold next year. I believe that people with children will also benefit next year. The full effect of this plan will not be seen for a year or two. The only people who are asked to pay anything are big business people, and people who are employed and have no responsibilities, like a single man or a married man who has no children. A short while ago, I met a young man of about 22 years of age in Capel Street. He was "elephants" drunk and he told me he would vote against the Government. He is in a position to drink 25/- worth of beer and he does not want to give one pint to the unemployed man. That is the type of person to whom the Opposition are appealing.
Had I known the line Deputy Sherwin would take, I would have brought in my copy of The Decline and Fall and given some excerpts to the House. One of the most outstanding aspects of this Budget is the utter callousness of the Minister's approach to the ordinary man in the street. The Minister knows that this Budget will cause great difficulties to the small man on whose behalf Deputy Sherwin should speak. The Minister has said, in effect, that he does not care what happens to the small man.
I asked him, for instance, about the difficulties which would arise for the small boy who sells newspapers at the corner of the street. The Minister admits that boy must pay turnover tax the same as anyone else, but it does not concern him, he says, how he will collect it. The problems of the newspaper boy selling papers at the street corner will be repeated all over the country in various degrees. There are the small huckster shops. Again, those people in Deputy Sherwin's constituency are the people for whom he, in his anxiety to ensure that there is no general election, cannot spare a thought. There are hundreds of them in his constituency; there are thousands of them in the city; and there are tens of thousands of them in the country.
If Deputy Sherwin took the trouble to investigate the problems in his own constituency behind the counters of little shops, he would find exactly what is to be found everywhere. Everywhere you go there is nothing but the greatest apprehension. Men and women who scarcely ever kept books before are now wondering how they will collect this tax, how they will pay it, and what the effect will be on their business. Many people do not realise something the Minister said very honestly the day we were voting on the Resolution dealing with this turnover tax. My colleague, Deputy Barry from Cork, asked what will happen in the case of a man who collects £1,250 in a year by way of turnover tax. He asked if he would have to pay income tax on that? The Minister said: "Yes, he has to." We find then the shopkeeper in this very extraordinary situation that not alone does he collect a tax for the Government but, if the Minister is correct in his answer, he has to pay income tax on the tax he has collected for the Government. That is the measure of this Government's complete disregard for the ordinary citizen of this country. It shows the complete lack of interest by the Government in the ordinary citizen of this country.
Deputy Sherwin, who has just left the House, very neatly synthesised the situation in which the country finds itself when he said big business is moaning and, in the same breath, that labour is moaning. Whichever way the Government may be turning, whether they be turning left or whether they be turning right, I would ask the Minister to reflect on this: it is not a happy situation for any Government to find themselves in when an Independent Fianna Fáil Deputy admits in this House that, on the one hand, big business is moaning at one end of the social and economic scale and, on the other hand, that labour is moaning at the other end of the social and economic scale. The Minister can be quite certain that what are known as the middle-classes are also moaning, because there is no relief for anybody in this Budget. The Minister was more than sincere, I think, when he said that his job at the moment is to collect the money and get it in. He will do that, come what may.
This Budget is a measure not alone of the necessities and the gravity of the moment but also of the Government's complete failure to grapple with the economic and financial situation of the country. It is all very well for the Minister to describe, as he did when we were discussing the Resolutions here, any criticism emanating from this side of the House as "bunk". The country will not accept that attitude from the Government. It is very easy for the Minister to say that he will answer any intelligent criticism but he will not answer any criticism from the main Opposition Party or the second Opposition Party because it does not suit him and because any opposition which does not suit him is not, in his view, intelligent——
It is not serious.
——opposition described in this House as "damn bunk". I should like to draw the attention of the House to the fact that the Taoiseach said that it was not the individual proposals in the Budget that mattered but the overall purpose it was intended to achieve. This might be an effort by the Taoiseach to distract attention from some of the more unsavoury aspects of the Budget, of the biggest and most amazing Budget in the history of this House. If one is to take what the Taoiseach has been saying for some time now, and particularly his last speech on this Budget, at its face value, Fianna Fáil of the late 1962 and the early 1963 is a completely changed animal.
The Taoiseach, the father of protection, has become the prophet of free trade. Now, I am not saying that we should regret the fact that Irish industry cannot any longer shelter behind tariff walls and will have to stand on its own feet. What I am saying is that it is about time Fianna Fáil realised the necessity for free trade and realised also that Irish industry can be pardoned now if it does not know exactly where it stands. The Irish industrialist finds himself in a most difficult situation. He has been warned by the Taoiseach, by the Minister for Industry and Commerce, and any other Minister who happens to attend chamber of commerce dinners, for some time past that he really must get away from the idea that he will continue to be pampered. He has been warned in this Budget that he will be further mulcted in corporation profits tax and in various other ways.
There are some other aspects of this Budget to which I should like to refer. When the Taoiseach spoke, in the course of his discussion on his turn to the left, about the necessity for further Government intervention, I hope that he meant the direct intervention of this House and I trust that in any measures it may be found necessary to introduce further to control Irish industry, this House will not be asked to give carte blanche to any Minister, or to any Minister's Department, to deal as it will by regulation or by order with Irish industrialists.
This House has gone more than far enough already in surrendering its rights to anonymous individuals whom nobody in the country can recognise. It is absolutely vital that, if the Government's swing to the left portends further Government interference with the rights of the ordinary businessman to deal with his business in his own way, the elected representatives of the people should decide these matters openly here and that such matters should be enshrined in a statute under which the ordinary citizen, the ordinary businessman, will know exactly the extent of his rights, the extent of his abilities, the extent of his disabilities, so that he will not find himself in the situation that overnight, by regulation, he can be told to do something of which he could not possibly have been aware prior to the making of a regulation.
Speaking as a lawyer, I deprecate any effort to increase further the intervention of the State at this stage in business. I am not a businessman, but I have, since the Taoiseach's speech, heard businessman after businessman expressing the gravest apprehension as to the lines this State intervention might take. It is true that Mr. MacCarthy, the Secretary of the Department of Industry and Commerce, in an address which he delivered recently in public complained that many of the incentives held out to Irish industry by way of adaptation and improvement grants were not being availed of. I regret that as much as anybody else. I am quite sure there are many businesses in this country which could make very good use of the very generous grants introduced by the Government, but I can well sympathise with the businessman who refuses to take a grant from the Government, believing that, if he takes the grant, it will be followed by six or seven different varieties of civil servant descending upon him from six or seven different directions to find out exactly what he is doing with the grant.
Now that the Taoiseach has announced that Irish businessmen are to be open to further Government intervention, I can see a further and more pronounced reluctance on the part of Irish businessmen to submit themselves to such danger. The great tragedy is that Irish business was never more in need of infusions of capital. The great tragedy is that there are not better relations between the State and business, that there is not less suspicion haunting the mind of the businessman who looks for Government grants.
I suggest earnestly to the Minister that there may be some other way of making available to Irish business these necessary infusions of capital. I always feel we are not making sufficient use of private capital in this country, that the man who has his money invested in IMPS and BATS across the Channel is not getting sufficient incentive to bring it back and invest it in Irish industry. It is not for me to tell the Minister how that could be done but we should make some attempt to repatriate our private capital and put it to use here, for two reasons; one, that it would make the money available to Irish business and, two, that it would reduce the amount of Government interference in a number of semi-State bodies operating in this country.
There is no doubt that some of the finest semi-State bodies in Ireland are gravely disturbed by the interference of the Minister's nominees on their boards. I think the Minister is aware of that himself and he must be struck by the fact that that is so. People who have no political axe to grind, people whose standing in the commercial and industrial spheres is second to none have expressed, if not publicly, certainly semi-publicly, their anxiety about the manner in which the hand of the Minister is making itself felt in the running of a business, the success of which is entirely due to the personal qualifications of the person in question.
I want to express my regret that newspapers which are traditionally bracketed with the Government should descend to the devices to which they did descend the day after the introduction of the Budget, misleading the people into believing that there had been no increase in the prices of various commodities and showing pictures to indicate there had been no increase in cigarettes, drink and so on. Everybody knows now, if they did not know the day after the introduction of the Budget, that this Budget is not just the first cousin but the blood brother of the Budget of 1952. This Budget will mean an increase in the price of every necessary that every man and woman, whatever their circumstances, must purchase in order to feed their families. If the Taoiseach is swinging to the left, it is an extraordinary way of doing it. I do not think the Taoiseach really means that he is swinging to the left in that sense. It would be illogical for one thing because, while he talks about swinging to the left, we cannot forget that not so long ago he attempted a pay pause on a Friday and disengaged it on the following Monday.
No, only postponed it.
Postponed it. I would appeal to the Minister, even at this late stage, to consider the plight of the small people to whom I have referred, or at least to give them some indication as to what they will pay. Take the man or woman in the small shop. How is he or she to pass on 2½ per cent on the price of a box of matches ? The Minister has suggested that they can put it on one commodity and not on another. That is all very well for the supermarkets and the large combines who can put on the 2½ per cent on the larger items and not put it on the smaller items at all. If they do that, they will wipe out the huckster shop and the shop which is a little bigger than the huckster shop and which deals only in these small items.
Does the Minister want us to look upon these times as the dying days of the small shopkeeper, the decent man who makes his living on small items and brings up his family in the fear and love of God and feeds and clothes them on the proceeds of such shops ? There is no Government assistance entailed here. These shops have been passed on from generation to generation and these men who own them now were living in the hope that they, in turn, could pass on their shops to their families without any Government assistance. However, because of the active interference of the Minister, the present generation of small shopkeepers is threatened with complete extinction.
Human nature is human nature and the Minister should remember that this will resolve itself into a question of decent shopkeepers being wiped out or the Minister being wiped out, and that the public are not as inarticulate as he might think. Due to an act of God, the average citizen will have an opportunity to tell the Minister in the coming by-election what they think of his proposals. These people will have their revenge before very long unless the Minister sees fit at this stage to abandon the attitude which he adopted in this House when I asked him how the little newspaper boy was to put 2½ per cent on the price of the newspapers. The Minister in the most callous way possible, at column 193, volume 202, of the Official Report of the 23rd April, 1963, replied: "That does not concern us." The difficulties of the continued existence of the least citizen should concern the Minister and the Minister will very shortly be told by the ordinary Irish citizen that if he is not concerned, they will find somebody who will be.
I have been concerned with them over the past 30 years.
If not for reasons of justice but purely for reasons of self-preservation on the part of the Minister, I would ask him at this stage to give further thought to the proposals which he now thinks fit to impose on the Irish people.
None of us likes taxes being imposed but they are necessary for the wellbeing of a country. In this Budget, the tax which is being imposed is a very small one spread over a very wide field. The Minister let it be known a few months ago that he had something like this in mind and there was not very much objection to it until he brought it into this House. Deputies on the opposite side of the House are building castles in the air rather than facing reality. Notwithstanding this Budget, there will still be in the shops the 6/11d., 7/11d., 8/11d. and 19/11d. goods. There is no question of the tax being put on a box of matches. The shopkeeper is a businessman and he knows the commodities on which he can make an increase if he feels like it. He knows that in the last year there was a seven per cent increase in the turnover of the retail trade and that there was an increase the year before. One thing the shopkeeper wants to see is the turnover increasing each year. He has a mortal dread of a recession, in which the turnover goes down, and there is less money in the country.
We are a young nation. We are expanding. We are building up. If we are to maintain that progress, we shall have to have the money to do so. Look at the other side of the picture. If we do not continue to build up, it means cutting down on essential services, on our expansion, on our grants towards new factories, on our help to the poorer section of our people, on our grants to farmers. It would mean that we would have to cut down on the reduction of 25 per cent in rates which we gave to farmers last year. If we did anything like that, every shopkeeper would feel it. There would be a reduction in his turnover. There would be a recession. No country could stand the like of that.
About seven or eight years ago we had a recession. Everywhere one went throughout the country one heard: "Ireland is finished. There is no future in it." However, once we started on our five-year plan things began to change. There is confidence in the country and it is to be noted no matter where one may go. It was a sight for sore eyes, coming into Dublin last evening along the Naas Road, to see so many big cranes and buildings dotted around the countryside. That is practical proof that the country is progressing. By giving grants for factories, we are ensuring that the factories will give us the employment we need.
How many people are coming back from England for some years past? Dublin Deputies say they have a serious housing problem due to so many people coming back from Britain. In my constituency a great number have come back from Britain. They know the wages here are every bit as good as those on the other side of the water and naturally they like to be among their own.
The turnover tax is very small and none of us will notice it. Much mention has been made of the way it will be collected. Some Opposition Deputies say the shopkeeper will be driven out of business. It is alleged that he will have to keep extra books. We must remember that 90 per cent of the shopkeepers in Ireland are paying income tax at present. That means they have an auditor. Their books are audited and they are paying income tax. It will mean nothing much to them when the purchase tax comes into operation on 1st November next. It will make no difference whatsoever except possibly that at the end of each month they will have to pay the two and a half per cent. There will be no extra book-keeping or anything like that because they are already doing it.
Only ten per cent of shopkeepers are not paying income tax. The Minister has given very careful consideration to the position of small shopkeepers. He has mentioned that where a person with under £50 he will be paying only 5/- and if necessary he can pay in the form of stamps on a card. If it is £100, it is 17/-. Therefore, the small shopkeeper will not be penalised to the same extent as the bigger shopkeeper and his bigger competitors.
There was some talk about the commodities on which the tax would be imposed. An increase in the price of cigarettes did not bring in the Minister any extra money last year. I cannot see a shopkeeper who sells cigarettes putting money on them when he knows it will bring his turnover down. There will be competition. I can see quite a number of advertisements next October which will read: "No purchase tax here. No purchase tax there." Therefore, I should like people to think in terms of what will happen.
I can well believe that the Minister has been considering this new type of tax for a long time. It was recommended by the Income Tax Commission set up a few years ago. They see that it is a form of tax that will bring in quite an amount of money without creating any great hardship on anybody. I cannot see it imposed on tea, butter or sugar but, rather, spread over items that can carry this tax. I feel this is a tax which has come to stay and no reference to its removal later has been made from the opposite side.
We all know that in plenty of shops there are many commodities carrying a very high profit and some of them can take this tax. The same applies to the liquor trade. Some items there can carry this tax. I note that a body representing the publicans of Ireland complimented the Minister on the introduction of this Budget. They realise that the more money in circulation in Ireland the better it is for them. If there is more spending power, more people will go into public houses. They realise the advantage of having Ireland on the move and having Ireland building.
I listened to much of this debate. I have not heard any Deputy speak against the increases under this Budget for the old age pensioners or the unemployed although it is expected they will cost about £4,000,000. With a rising cost of living, who will deny those people something to cover the increased cost in the standard of living in the past year? There is a sum of 2/6d. on the old age pensions and there will be an increase for the contributory pensions. It is the same in regard to unemployment assistance. This is the year 1963. There is a Freedom from Hunger campaign in operation at the moment. We shall not neglect our unfortunate ones such as the unemployed who, very often through no fault of their own, are out of a position. Naturally, with their families, we should like to be able to keep them in food, if nothing more. We do not want to have people hungry in this age.
Any person who considers the matter will realise that the Minister is not imposing this purchase tax on capital goods or buildings because they are essentials. We want to encourage building. If we put a purchase tax on housing, the price will go up still further. We shall make our income from capital goods. The Minister has designed this Budget to help our improvement growth which has steadily been increasing over the years. His desire is to help us to keep moving forward which is what I am sure all of us would like and which every one of us is striving his best to accomplish.
It used to be said that some of our exporters were not keen enough on expanding, but we hear little of that now because four or five years ago there was a reduction in income tax in respect of profits on exports. We have a population of only 2¾ million and, therefore, a couple of good factories are able to supply the home market. We have to encourage industries to look for trade abroad. Great countries have been built up through their export trade. It is only in that way we can look forward to the expansion of our industries. We must, therefore, get new firms to set their sights on markets in England, Europe, America and all over the world. That has been happening. Unless that is done, we cannot expect industries to give the employment we need.
Some firms may complain about the five per cent increase in the corporation profits tax. This is in respect of an income over £2,500. This tax is still well below the corporation profits tax in the Common Market countries and in America. There will still be an incentive to firms in those countries to come here because our tax is well below theirs. The incentive to engage in the export trade is not being interfered with, either.
If you read down the figures in the Minister's Budget speech, you will see what he is trying to do. Subsidies of one form or another, amounting to £40 million, are being given to agriculture. That is a big slice of the Budget. Few Deputies will object to paying that to farmers, because things have not been going that well with the farmers for the past three or four years. They have had a good deal of trouble in the eradication of bovine TB. They deserve great praise for eradicating bovine TB in 20 of the 26 counties in such a short time. It was a wonderful effort on their part.
In the field of social welfare, £34 million will be spent in the coming year for the benefit of pensioners and the unemployed. Despite anybody saying that the figure should be lower, it is our duty to help the less fortunate in our community as best we can.
There has been a big increase in the provision for education, on which £21 million will be spent in the coming year. We like to see the members of every family being put in a position to make a living and improve themselves. We have seen boys get their group certificates from the vocational schools, become apprentices and eventually fitters, electricians and members of various other trades. Those boys are now earning a good living. If this idea of building up industry had not been encouraged, those boys would have been in unskilled jobs like their fathers. Now they have a skilled trade and are able to better themselves. With increased educational opportunities, they will be able to better themselves still further. As more secondary schools are built, they will be able to go into the professions. Secondary schools are being built and extended in many towns. In my own constituency, one has been started in Kilcock and the secondary school attached to the national school in Maynooth is being further extended this year. This will enable more people to obtain better positions. Nobody will say we should prevent that development.
In order to pay for these services, we have to have a tax. Nobody likes it. When next November comes, the public will not realise this tax is going on. It will slide in. You will not notice it. Every shopkeeper is a business man. His turnover has been increasing for the past few years, and he wants it to keep on increasing. He will put it across gradually.
I had forgotten to mention that some weeks before the Budget an extra 1d per gallon on milk was given. Very little increase was granted to the dairy farmers over the past few years and the Minister has now seen his way to grant an extra penny on the gallon of milk which will cost £1,200,000.
Is he not taking it away now?
It takes a lot of money to do that. When you look at the Budget, you see that he is looking to the future, to keep Ireland going forward. When the 2½ per cent tax comes in, I feel it will slide in and we will not notice it and when Christmas is over, we will wonder when did this purchase tax come in.
Deputy Crinion must be a simple man.
You should go and see his farm.
He must be a very simple man in regard to other things. One of his points was that the Minister by putting on this turnover tax was going to give money to people who were not doing too well. Did he read the Taoiseach's speech in the Great Southern Hotel, Galway, when he said that only those people who modernise their factories would get consideration from the Government? I wonder are people who are not doing too well able to modernise their factories and will they get the money Deputy Crinion promised?
Everybody was confused when this Budget was announced and they did not know what to think. I have discussed it with many people and they thought the turnover tax was merely a tax on shopkeepers and that it would not have any effect on them or on normal life at all. They thought the corporation profits tax was a tax on companies, that it would come out of profits distributed to shareholders or put to reserve, and that instead of putting so much to reserve, these companies would pay so much more to corporation profits tax. They thought that, after all, that did not affect normal people. That was the outlook most people had but now they are beginning to realise the impact of the Budget.
The ordinary shopkeeper did not realise at first that from now on he will have to employ an auditor and that he may be requested by the income tax inspector to employ an auditor. Up to this, the income tax inspectors were prepared to accept auditor's figures for the accounts of companies or shopkeepers or any other industry, but that does not obtain any longer, and now the income tax inspector, if he wishes, may decide not to accept the figures of a genuine and accredited auditor and can send down his own inspector to the shop to check the records and the daily sales. As I say, up to this, the income tax inspector accepted the auditor's figures, and of course rightly so. The auditor had to be correct to the best of his ability, or else his firm went out of business, but as long as his firm was in business, his figures were accepted by the income tax people.
The Minister has shown very poor confidence in a profession, the accountant's profession, which over the years has proved its worth. These accountants have done justice and have played fair between the shareholders and directors of companies and between companies and the Government, or the income tax inspector. The Minister should have shown more confidence in them than to say that in future they will send in inspectors. When the Minister was returned to office in 1958, one of the first things he said was that he was going to examine the Civil Service and make as many reductions as he could by not taking on extra hands and not filling vacancies when people retired. This new measure is going to increase the number of civil servants very substantially. That would be accepted in war time but this idea of increasing civil servants for the purpose of checking accounts where auditors have already been employed is not to be welcomed.
As Deputy Sherwin said, the Government must get the money. They are short of money, but why are they short? Were things not buoyant last year and if they had held their hand and been reasonable, there would be no need for this taxation. It is only because of their wasteful expenditure that it is required. They talk in millions and spend in millions. When the Taoiseach was speaking about the trade balance, he mentioned the figure of £100,000 and when he was reminded by Deputy Dillon that it was £100 million, he asked what was the difference? What is the difference between £100,000 and £100 million?
The public service debt has increased from £24½ million in 1958-59 to £34½ million for 1962-63, an increase of £10 million. There would be something to be said for that if we could see genuine results from the expenditure of that money which created the public debt which has to be serviced and which in five years has increased by £10 million. What do we see? What are the results of this increase? Emigration is still continuing and the number of young people between the ages of 18 and 30 who are emigrating is just as high as ever. The Minister for Finance spent some time explaining that the emigration figures had gone down. I remember the Parliamentary Secretary to the Taoiseach explaining that it was very difficult to get the emigration figures between each census and that it was only when we had the full five-year period that we get them accurately. But now we can get them every year. If we think they are improving, we can produce figures—where they come from I do not know.
As I say, there would be some reason for the increase in the public debt if emigration had stopped and if there were increased employment, but there are 30,000 fewer employed now than when the Government took office. On top of that, unemployment returns were much higher than in the past year. The figure for the week ending 20th April was 58,549. In 1962, it was 52,650 and in 1951, 51,484, an increase of 7,365 and that is along with our increased public debt and increased capital charges.
Have the capital investments given the return which they should give? Are the ordinary people getting the benefit of that capital investment? I do not think it is being spent to the best advantage. Last January and February, the number of unemployed was 10,000 higher than in the previous year. The Taoiseach said it was because of the snow and the hard weather. That was true. The building trade was closed down. Meath County Council closed down although others did not. Certain employment could not continue in that weather. But everybody felt that the 10,000 would come down to a normal figure, or even show a reduction on the figure for the previous year, when the weather improved. Instead, there was an increase of 7,365 as compared with 1961. Does that show that capital investment has proved its worth?
What confidence can the people have in the new economic plan which Deputy Crinion told us the Taoiseach had produced, when the same man, when out of office and with more time to think, produced a blueprint that was to give 100,000 new jobs, spaced at the rate of 20,000 per year? Even after all the capital expenditure and increased capital charges, we find now we have 30,000 fewer employed. What confidence can we have that the next economic plan will not work out in the same way as the 1957 plan? I remember that we found it hard going when we saw the posters saying: "Wives, get your husbands back to work by voting Fianna Fáil." People believed that but now, after six years of Fianna Fáil Government, we have fewer employed. This Government have always made out that they are the working-man's party and represent the worker and that there is no need for a Labour Party. This talk of a "movement to the left" is part of it. Of course, Fine Gael do not represent the worker; they do not represent anybody——
Hear, hear.
——but if Fianna Fáil feel sympathy for the people and want to try to remedy the ills of the people, do they think it will improve the health of the people to reduce food subsidies as they did in 1952 and to put up the cost of ordinary foodstuffs, as they did then? They had a good excuse. They said it was because of the mess left by the inter-Party Government. In 1958, when they got back to office, they used the same excuse. They said the country was in a terrible mess and that they had to remove the subsidies altogether, despite the fact that the then Taoiseach had said that it was suggested that Fianna Fáil would put up the price of food and had asked would anybody think of Fianna Fáil doing such a thing? But they did it in 1952 and in 1958.
Apparently, they must have money flowing in. When the flow dried up, they brought in PAYE. That brought people into the income tax paying bracket who had not paid it before. Apparently that inflow is now drying up and they come along with the turnover tax. No doubt, if the inter-Party Government had been in office we would have been told that the turnover tax had to be introduced because of the mess they had made. But it has been a Fianna Fáil Government not for one term of office but for portion of a second term and the necessity for a turnover tax arises. They must have increased money every day and it is the workingman, the man with the large family who must suffer. Since last August, the cost of living has gone up three points. What will be the effect of the turnover tax? Deputies opposite are saying that it will not affect this and that but it will be put on to every item. Only next November, December and January will we realise that.
The Minister, in his opening statement, said the House was aware that the Government were considering a purchase, sales or turnover tax. I do not think that was ever announced in the House but it was announced at various dinners and Fianna Fáil cumann meetings and the suggestion was that it would affect only luxuries. There was no question of anything else. I should like to put on record, and I think every Deputy should state, the effects of that tax. It will have very little effect on luxuries because those who can buy luxuries can afford the 2½ per cent. but it will hurt the person buying a lb. of tea to the extent of a 1½d., the person buying cigarettes to the extent of ld., the person buying a small whiskey to the same extent——
Do not be so gloomy.
I want to put this on record and there is nothing gloomy at all about it——
That is better.
It will hurt to the extent of a penny on the lb. of butter, 3d. on the stone of flour and 1/- on a pair of boots.
The Government recognise that; they have given 2/6 to make up for it.
Only to a certain section and it will not go very far. You might say that there is already a tax on food because the removal of subsidies in 1952 and 1958 increased the price of food. But this is a direct tax on the food of the ordinary people. The Government are searching so hard for revenue that even the person with £50 turnover must now keep records and pay tax. Imagine a shop selling less than £2 worth per day having to keep records. Is that not a terrible state of affairs?
They can pay it in stamps.
Yes, but is this not going to make tax-dodgers of ordinary, decent people who had no intention of breaking the law? They merely wanted to live quietly until called to their reward but now they will be wondering when will they be caught. You might say they will become thieves of a kind. Is that not a terrible thing?
The Government are hoping, and are going a good way about making it come true, that the day of the small man is gone, together with the small farmer and small shopkeeper. Many Government Deputies make a point about this tax that it will not be noticed and that with present day competition, the supermarket will cover it up. Is that the hope of the Government, that the small shopkeepers will be wiped out by the supermarket? As a result of the Government's agricultural policy, a tremendous number of small farmers have been wiped out and now I feel the small shopkeeper will be taxed out of existence.
The Minister for Justice last night said the prosperity in the country is so wonderful that the turnover tax and the corporation profits tax will be absorbed. I wonder what effect this Budget will have on the tourist industry? The tourist industry has been boosted. Bord Fáilte and other organisations are trying to promote and expand tourism. This Budget means that after 1st November a person who stays at an hotel will get his hotel bill plus 10 per cent service charge, plus 2½ per cent turnover tax—two pluses on his hotel bill. Will that help to develop the tourist industry or can the supporters of Fianna Fáil say that the tax will be absorbed in the profits of the hotel?
I saw recently figures showing profits of some hotel companies in Dublin. In one company running two of the principal hotels in the country, the profits in 1961 were £13,000 and in 1962, had gone down to £7,029. That shows the prosperity in the tourist industry at present. These are figures produced by the hotels, which must make certified returns. In the case of another very prominent restaurant and hotel in this city, the profit in 1961 was £5,019 and in 1962, £452—less than £500. These hoteliers will be called upon to pay the corporation profits tax so that the Government may be able to give subsidies and grants to luxury hotels to compete with them. They will be pilloried. Out of the small profits they make, they will have to pay corporation profits tax, so that the Government may get the money to enable them to build luxury hotels and luxury Parliament buildings.
The corporation profits tax has been increased by five per cent and that is to cover even the first £2,500. Even the small hotelier will now be called upon to pay corporation profits tax—not the person with the small hotel—but the person with the hotel with small profits, which is by no means a small hotel. It is estimated that this will yield an extra £3 million and the tax is being made retrospective to January. It is a terrible thing that this tax should be made retrospective. Every industry and firm has its accounts made up for the previous year and will now have to make extra provision for this retrospective tax.
Take an industry earning £10,000 a year. The income tax and corporation profits tax will be £4,541. That might be the entire liquid resources of the firm. Any progressive firm that made £10,000 would use some of the profit to increase stock or to make small additions to the premises. The Government say to that firm: "We want all the liquid money you have. Hand it over." If the firm have an overdraft in the bank, it will have no hope of reducing the overdraft after the Government deduct this £4,541. This tax is to yield an extra £3 million and the Government will get out of these firms alone in the coming year £7 million.
Will there be any hope that such firms could pay out cash for a new lorry costing £3,000? The Government should appreciate the difficulties facing such firms when they are called upon to make such a big contribution in taxes. It is a cruel hardship on small firms. The firm that makes £10,000 a year need not be too small. The Government are taking practically half of that profit from them.
I did not mind the Taoiseach speaking about agriculture because I do not think the man has any idea of agriculture and does not intend to acquire knowledge of the subject. He was talking about the price of milk and said that any increase in the price of milk would mean an increase of 1/- in the price of butter. That shows the Taoiseach's knowledge of farming. The Taoiseach said that a lot of money was being spent on agriculture, in the eradication of TB and otherwise. I wonder if the Government are spending this money in the right direction?
I thought that if any extra money were to be given to agriculture, it would be given for the restoration of Section B of the Land Project. That is the most essential section. Only wealthy persons can reclaim land under Section A. Money has to be put down in a lump sum under that section. It is only a man who can put down from £1,000 down to £100 who can get his land reclaimed. Under Section B, the cost can be included in the annuities. That is a sensible provision that I thought would be made in this Budget. As a result of the discontinuance of Section B, contractors have given up working for the Land Commission. There is no demand for them. People cannot afford to pay the lump sum. The result is more unemployment.
We got a note yesterday showing the number of acres done in each county and the number of schemes carried out in each county. How much finer a report would we have if Section B had been continued? I thought the least the Government would have done would be to derate the first £20 in the valuation of agricultural land. That is fundamental if they want to encourage small farmers but that was not done. There has been no mention of it.
There is at present 60 per cent foreign wheat and 40 per cent Irish wheat in flour grist. There is no reason why the ratio should not be reversed to 60 per cent Irish and 40 per cent foreign. Apparently, the policy of the Government is to kill and cut down wheatgrowing, in the belief that it is costing the people too much. Is that the only thing that is costing the people too much? Without any trouble, there could be 60 per cent Irish wheat and 40 per cent foreign wheat in the flour grist but, due to the policy of the Government, the ratio is 60 per cent foreign and 40 per cent Irish.
The increases in social welfare benefits are very modest, although, of course, they would be welcome at any time. I should like to know if there is any relief for persons on fixed incomes, the persons who have been affected by this Government all along. The incomes of such persons were reduced immediately the Government reduced the food subsidies in 1962, again reduced when they removed the food subsidies in 1958 and are now being further reduced by the turnover tax. Is any compensation to be given to the people on fixed incomes?
On Sunday, I took the Sunday Press in the hope that I would see some good point in the Budget brought out. I thought there would be a feature giving our views, and that there would be other articles and comments, but to my amazement, there was not one line in the Sunday Press about the most extraordinary Budget ever introduced. The fact that there was not one line of comment shows that there must be no silver lining to the Budget, if the Sunday Press could not find it. They realised what a frightful Budget it was, and they decided it was best to leave it alone.
Will this Budget encourage our young people to stay in the country? Will further taxation encourage them to stay at home? I have known men who became redundant when the stations at which they worked on the Portlaoise-Kilkenny main line were closed. They were offered employment in Waterford and other places, but rather than go to other parts of the country, they considered going to England, the idea being that they could keep their roots at home and send money from England to support their families, rather than try to run two houses at home.
I do not think this Budget will encourage the tourist industry. Those are the two questions I ask. Will it encourage young people to stay at home and will it encourage the tourist industry? When a person gets his hotel bill, there will be a ten per cent service charge on it, and there will be a 2½ per cent turnover tax on the hotel bill, plus the 10 per cent service charge. A Minister has asked: "What would you have done to deal with this terrible catastrophe?" We would not have done this because we would not be in that position.
You would have run off and left it behind you.
We would not be in that position. We would never put a tax on food. Fine Gael never put a tax on food. We always tried to maintain the price of food at the lowest point for people on fixed incomes and for the lower income groups. When Fine Gael return to office, the first thing they will do is to remove the tax which the Fianna Fáil Government have put on the food of the people.
The speech to which we have just listened exemplifies the policy of the Fine Gael Party. One thing which inevitably arouses their antagonism is any endeavour to develop the natural resources of the country, and to provide the people with a better standard of living. I do not want to hark back to what happened in 1948, when the transatlantic air service was sabotaged, and when several industrial projects were shut down. Rather do I wish to emphasise the contrast between the policy pursued by the Fianna Fáil Party when in office, and that which has been advocated, even in this debate, by the Parties in Opposition.
On Wednesday last, after he had listened to Deputy Dillon and, on the preceding day, to his chief lieutenant, Deputy Sweetman, the Taoiseach, in the opening passages of his speech, said three things which it is essential to seize upon and note, if we are to understand the importance of the part which this year's Budget will play in the development of the national economy.
I wish to repeat them because it is imperative to impress these three things firmly and clearly on our minds. The first is:
This Budget rests on the proposition that economic and social progress require increased Government spending.
The second is:
We can cut down on Government spending only by cutting back on economic and social improvement.
The third is:
The Fine Gael approach—
—to national problems—
—as disclosed in Deputy Dillon's speech this afternoon and in speeches made by him and his colleagues yesterday, is negative, deflationary, timorous, political in the extreme. The Fianna Fáil attitude is, and I hope will always remain, positive, constructive and national.
The Taoiseach's dynamic, forthright exposition of the principles and policy embodied in this year's Budget should be contrasted with the performance on Wednesday of Deputy Dillon when, wailing like a lost banshee, he went meandering from dreary prognostication to dreary prognostication, with no more support for them than his debilitated imagination. What the Taoiseach said should be contrasted also with the barren ineptitudes of Deputy Sweetman, the flippant inconsequences of Deputy Norton, and the attempt to have it both ways of Deputy Corish.
If the comparison is made, there will be no doubt in the mind of any sane man or woman that the direction of this country's affairs should remain where it now lies. Indeed, anyone who is concerned for the country's wellbeing must be appalled to read the speeches of the Opposition Leaders, so absolutely empty they are of any constructive suggestion, of any attempt to find a solution for the country's problems.
Take Deputy Dillon's speech as an example. In his more expansive moments, Deputy Dillon talks like the master-mind of the universe. When he is in that mood, his arms open to fold in his embrace the whole democratic world. His big heart yearns not merely for friendship, brotherhood and union with Western Europe, but he wants to include the Americas as well. That is, of course, when he is in that mood. But on Wednesday, alas, he was not in that mood. Instead, he spoke like an atavistic throwback. His reference to the citizens of other European States was an anachronism in this day and age.
At the very moment that the Sovereign Pontiff himself is striving to bring all men together, Deputy Dillon spits, figuratively of course, on any European who aspires to make his home here, who would wish to bring up his children in a Christian environment, or to invest his fortune and his technical knowledge and skill in our rapidly expanding economy—rapidly expanding, that is, so long as it is directed by the men and the Party who, in face of Fine Gael opposition, launched every industrial development of the many of which Irishmen are proud today.
Deputy Dillon is a man who wanted us to enter into the war so that we might help to save Europe; the man who would have us join NATO; and who urges us to seek an economic entente with Great Britain. I can understand and appreciate those points of view. There is nothing dishonourable in holding them, but there is much that is dishonourable, when the Leader of a Party which has written these causes on its banners, stoops as Deputy Dillon did in his speech on Wednesday last, to the most rabid xenophobia.
Those who have listened on other occasions to Deputy Dillon perorating ad nauseam on the great principles of liberalism, on the free flow of men, money and materials, must have thought on Wednesday that it was not Deputy Dillon at all that was in it, but a changeling who was with us. However, we all know the fable of the basket of apples and how one bad one corrupted and made rotten the others. Here it was exemplified before us on Wednesday last, when we heard Deputy Dillon, the son of John Dillon, and the grandson of John Blake Dillon, speaking with the authentic tones and accent of Deputy Oliver James Flanagan.
I wish to be unfair to no man, least of all to Deputy Dillon, but there was one passage in his speech to which I would particularly refer. I must do so, because the point he made was relevant to the critical problem in the knowledge of which this Budget has been framed. It is the fact, to which he called attention, that the Agreement of Association between Greece and the European Economic Community is not proving the boon to the farmer that it was expected to be. I am sure I shall do the Deputy no injustice if I say that the plain implication of his reference to Greece is that as strongly as ever he would support the entrance of this State into the European Community.
Let us consider that for a moment. Deputy Dillon is anxious that we should become members of the Community. So are the Government. So, I believe, is the vast majority of our people. Yet, apart from the fact that it was recognised that we could not be admitted unless Great Britain were admitted also, what was the special objection which was raised against the acceptance of our application? It was that by European standards ours is an underdeveloped economy.
This Budget, as was every Fianna Fáil Budget that preceded it, is designed to reduce that objection to a nullity. This Budget is, as they were, a Budget for national development. Every figure in it, every figure in the Estimates for the Supply Services, and every figure in the Capital Budget proclaims that fact.
The Government have embarked on this programme of economic expansion, not with any desire to spend the national capital on grandiose schemes or to provide employment at any cost, but because we are convinced that, if it is to survive, this nation must expand and greatly expand economically. There is no cure for our social problems, for emigration, for late marriages, for unemployment, for derelict farms and deserted countrysides and decaying towns, except in economic expansion. If the Government were to fail to face up to that fact, were to fail to accept the fiscal and financial consequences of it, then this nation would inevitably stagnate and decay. Nothing within the foresight of man is surer than that. Our ability to cope with the ills I have mentioned depends on our ability to do business with the rest of the world, over a much more extended range of territory, with a greater variety of commodities, and on much more even terms, than we have been able to do business heretofore.
Deputy Dillon rejoiced that we still have what he described as "a viable and invaluable market in Great Britain for our livestock and for a large proportion of our industrial output." I shall not quarrel with Deputy Dillon's description of our right of entry into the British market. It is a right which rests on the Irish Agreement which the Fianna Fáil Government of the day made with the British Government in 1938.
Plus £10 million.
Unfortunately, however, the folly of the first Coalition in 1948, when it repealed the External Relations Act, has left our place in the British Market less assured, less viable, and, because less assured, less valuable, than it was under the 1933 Agreement. When Deputy Dillon, let me recall, at the behest of Deputy Dr. Browne, on whom today he vents his sarcasm and his chagrin, doffed the Union Jack and sported the Tricolour as his personal adornment, he set in train the erosive influences which are eating into the highly favoured position, which from 1938 until 1948, we had enjoyed in the British Market.
If our external relations with Great Britain had been left undisturbed—and there was no necessity to disturb them for the Republic of Ireland Act added nothing to our independence and did nothing to enhance our stature as a nation—the British Government would not have yielded in 1960 to Danish pressure, neither would they have ventured to enforce their anti-dumping laws against our butter, nor to visit on our dairy farmers the consequences of Deputy Dillon's folly in 1948. But that is by the way.
My sole purpose in directing attention to what happened in 1961, is to show that Deputy Dillon, and those who share his views, are much too complacent about our market in Great Britain. We may be able to hold our place there in the coming years. I hope we shall but, if we do, it will be in the face of the keenest competition, even perhaps in the face of pressure brought to bear on Great Britain herself to exclude us. Certainly it will not be on the same basis as it was before the External Relations Act was repealed. The fact is that unless far-reaching measures are taken to develop our production and to make it more efficient, the nation will be hard put to maintain even its present population on our present standard of living.
Since 1958, by which year our Minister for Finance had rescued our public finances from the chaotic confusion into which, for a second time, a Fine Gael-Labour Coalition had thrown them, every Fianna Fáil Budget has been an expansionist Budget—expansionist but not inflationary, because the increase in public investment was matched by an increase in productivity, in industrial and agricultural expansion, and in employment. Admittedly our public debt is high, the highest in our history. So is our credit, and our credit is high because it is recognised that expansion is vital to the nation.
The country is in pawn.
Order.
The public has outgrown the old out-worn Fine Gael dogma that we can exist on the basis of a predominantly agricultural economy. It realises now that everything possible must be done to raise the efficiency of our agriculture to the limit of our achievement and that manufacturing industries must be established to absorb not only the natural increase in the population but those who may be displaced by the increasing mechanisation of our farming. They have shown that, in our endeavour to accomplish this, they are prepared to back us not only with their votes but with their savings.
May I say now how glad I am to note that we are not without backing for that policy even on the benches opposite. On Thursday, in the course of a lucid, thoughtful and constructive speech—one, indeed, which merits the consideration of every member of this House—Deputy Cosgrave—I quote from Volume 202, column 496 of the Official Report—said :
This country has operated for many decades a successful combination of private enterprise and State endeavour. I believe that it is a sound and progressive programme which has returned the best dividends to the country. It might be described as a pragmatic approach to the matter but it is the way in which it works and how it works that matters.
Two sentences later Deputy Cosgrave declared:
What we want to see here is a progressive programme of development initiated and continued.
Still later in relation to the State's expenditure on our education services, he recalled that in 1930-31, the total sum provided for this purpose was £4,697,000 and in 1961/62 £19,500,000. From this he went on to point out, as reported in Column 497:
We find that 30 years ago, we spent 21 per cent of the total Supply Estimates on education and last year we spent only 35.4 per cent of the total for that purpose.
I wonder how much would be spent if Deputy Sweetman, who wanted us to slow down on Government expenditure, or Deputy Crotty, were in office and determining the policy of the nation in relation to education? However, to continue with the speech of Deputy Cosgrave:
If we are to avail of our investments in the promotion of industry and exploit them to the full, we must depend for that exploitation on the competence and skill of the people who run these industries. We must ensure that we can exploit that to the full and the only way it can be done is to increase the expenditure on education.
It is worth noting how this speech of Deputy Cosgrave's differs in its tone and tenor from those delivered by the Leader of the Opposition and by the former Minister for Finance, Deputy Sweetman. What person, if he did not hear those three speeches for himself, if he had no more than a reading of them to guide him, would believe that they were delivered from the same Front Bench.
In the same speech, moreover, Deputy Cosgrave adverted to a matter, to which I have already referred, the maintenance of our position in the British Market and it is manifest from the terms in which he discussed it, that he does not share Deputy Dillon's complacency in regard to it. Quite the contrary, I should say. He realises how vulnerable and insecure our position in that market may become. For Deputy Cosgrave quoted at column 492, and I think made his own, the view which was expressed in the Irish Banking Review for March in the following terms:
Nevertheless, it must be noted that Denmark, in particular, is pressing for wider exports to the United Kingdom. British Government spokesmen have already indicated that it might be possible to give additional concessions to Denmark without conflicting with the Commonwealth position in the British agricultural market.
From this Deputy Cosgrave went on to say something with which I am in full agreement, and which, for those who may not have heard him, I must quote. It is reported at Columns 492 and 493 of the Official Report:
That, I believe, poses very serious problems for this country. A recent announcement of the revised British quota for butter indicated that the Danish quota is about eight times our quota. From recollection, the figures are that Denmark will be entitled to 96,000 tons this year compared with a quota for this country of 12,000 tons. There is little use in establishing bodies like Bord Bainne or any other State organisation unless we secure either from their direct intervention or from bilateral or, if possible, wider multilateral trading arrangements, a market for the commodities we have to sell.
This balanced appreciation of our true position in regard to our largest and oldest market is in striking contrast to the euphoric trance into which Deputy Dillon passes when the words "British Market" fall from his lips.
It is clear from what I have quoted that Deputy Cosgrave, unlike Deputy Dillon, has given serious thought to our present relationship with the power which controls that market. Until the repeal of the External Relations Act in 1948, that relationship, expressed on its economic side by the Trade Agreement of ten years earlier, was on the whole quite a satisfactory one. At any rate it worked, even during World War II, and it was acceptable to both parties. So far as this portion of Ireland was concerned, we had all the privileges of the Commonwealth and all the rights of independence, uncompromised and unreserved. This special position was not only one of great consequence to us, but was one of great delicacy as well. For under it we had, what is seldom if ever secured in `real politik', the best of both worlds.
However, that happy position, as must now be apparent to everyone who is not complacent and who has been in contact with later developments, and as the passage of time will make clearer still, was balanced on the knife-edge of the External Relations Act; and that Act being gone, it is highly improbable that we shall ever be able to regain our favoured position in the British market. Certainly not, I fear, in my time. However, thanks to Mr. MacBride and his fellow-travellers of Clann na Poblachta, we are where we are in this and other markets and we must make the best of it.
How shall we do that? First, by doing everything we can to raise even higher, and even higher again the efficiency of our agriculture, until we rival the Danes in the British Market. That should be our first objective and we must not be deterred from pursuing it by the fact that the change which it will bring about may not be to everybody's liking.
How vigorously the present Government has been pursuing this objective is shown by the continuously increasing provision which has been made for the aiding and development of the agricultural industry in every Budget since 1959. In this year's Budget, the amount is £22.9 million; in that for 1959/60 it was £10.13 million. I have unfortunately not been able to obtain comparable figures for the last Budgets of the first and second Coalitions. I am sure the provision was substantially less, a mere fraction of what is in our Budget today.
If we take into consideration assistance from other sources in addition to that provided in the current Budget, we can institute a comparison between our attitude towards agriculture and the attitude manifested by the Coalition. The total aid provided by the State and State bodies towards the development of agriculture was £10.9 millions in 1950/51; £17.1 million in 1956/57; and £37.3 millions last year. This year, it is expected to exceed £40 millions. In fact, one would be justified in saying that since 1956/57 the community, through the State alone, has invested, or at the end of this year will have provided, the better part of £120 million for the improvement of Irish agriculture.
This has been supplemented by an investment, possibly on an even larger scale, by private sources. This, relatively speaking, huge investment on the part of the State and of certain sections of our community in agricultural industry has produced far-reaching changes in every sector of it.
The horse has virtually disappeared and its place taken by the tractor. Much that was formerly done slowly and laboriously by manual labour is now done by machinery. These changes were inevitable. They have had their impact on the industry in a way about which several Opposition speakers have tried to make heavy weather in this debate. Among other things, they have changed not only the amount of agricultural employment available but its pattern as well. This, as I have said, was an inevitable change, a change which we can no more keep back than King Canute could keep back the waves.
All other things being constant, increasing efficiency means increasing economy in the use of manual labour and, for a time at least, a decrease in the number of persons employed on the land. But that downward trend in agricultural employment need not necessarily continue. As our productivity per unit of labour employed increases, as our capacity to compete abroad improves, so, too, will our share of external markets increase and so, too, will the demand for labour increase. So, too, will the standard of living of all those engaged in agricultural production rise. But another and not less important consequence will flow from an increasing efficiency in our agriculture. Some part of the benefits of that efficiency will be passed on to our industrial workers. The cost of living for them will tend to fall making it easier for our manufacturing industries to export and making it easier for those engaged in them to improve still further their conditions and circumstances.
We must not assume, however, that agriculture can go it alone. We must make industry more efficient also. We must put into this purpose the same drive and vigour as we have been putting into agriculture. Indeed, we may have to put even more because heretofore Irish manufacturing industry has been too limited in its ambitions, too circumscribed in its objectives. Hitherto the greater part of it has been content with a snug existence at home. Henceforward, it must be driven out to make a living in the world. The Government, as the Taoiseach has so often said, is bent on making it do that. Only by this method can we compel it to re-organise itself, to cut out the deadwood and to expand, so that it will take care not only of the natural increase in our urban population but of those hands whom the increasing efficiency of our agriculture will have made redundant. It is doing that to some extent already but it must be made to do it on a very much larger scale in future.
However, it is not only on the immediate objective of holding our own in the British market that we must focus our minds.
We must anticipate events. We must prepare for the day, which will surely come, and perhaps sooner than later, when Great Britain is received into the European Community and our application to be received likewise will become once again a living issue. I have never been one of those who believed that when Great Britain applied for the privilege of admission to the European Community the doors would be flung open at her "Open Sesame" and the red carpet laid down for her. Speaking at Wexford on 24th January, 1962, I said:
Even as late as six months ago some people seemed to be under the delusion that continental Europe was waiting to welcome Great Britain, Denmark and ourselves into it with open arms. It stands to reason that nothing could be less realistic than such a conception of the position. The six States, members of the Community, having combined together to establish the Market, are naturally concerned to reserve it as completely as possible for themselves. Not unreasonably, they are asking those who seek to join now, what have they to offer Europe.
Therefore, I was not unduly depressed when events transpired at the end of last year as they did. On the contrary, I regarded them as affording us a respite, as prolonging our opportunity to befit ourselves to take and hold our place with the others in the European Community. Thanks to President de Gaulle, we have that opportunity and we must use every moment of it to equip ourselves for the test before us. Therefore I, like Deputy Cosgrave, but unlike Deputies Dillon and Sweetman, want to continue the "progressive programme of development" to paraphrase Deputy Cosgrave's words, which Fianna Fáil has initiated and is carrying through.
As one cannot make bricks without straw, neither can the State and the community re-organise and improve and expand the total of its productive equipment without spending money— and spending a great deal of it. The Leader of the Opposition, in his speech yesterday week, appeared to jib at that fact. He referred to the sum of the State's gross capital liabilities and committed himself to a statement of such carping irrationality that he himself must have shivered when he read it in the newspapers the following morning. The National Debt this year, he said, has established a record—as if that were something to be ashamed of. What else did he expect the National Debt would do? After all, the national investment last year was greater than that of the year before and that of that year before, in turn, was greater than that of the year which preceded it. If you have a State with a policy of progressive development, what can you expect but that in every year the National Debt will reach a record figure? What did Deputy Dillon really think it would do? Did he expect it would dwindle and disappear?
The national Debt at 31st March last did stand at a record figure—and so also did the assets against it. If they did not, we should not be continuing— if both these sides had not shown an enlargement — that progressive programme of development which Deputy Cosgrave, unlike his leader, is convinced is essential for survival. That the Government and its supporters, and with them Deputy Cosgrave and every intelligent and right-thinking man in this House, no matter where he may sit, are right in this view is proven by the highly satisfactory state of the economy. If the gross capital liabilities of the State have increased, so also, as I have said, have the State's assets. So also has the gross national product increased and the national income, as well as our trade, our agricultural production, our manufacturing production, our industrial earnings, the profits from our agriculture, the turnover of our goods and our domestic physical capital formation. All of these things increased in the year 1962-63.
In this year every favourable economic indicator has reached a new high. This year we have more habitable houses than ever before; more schools with more pupils; more industries and more people employed in them. We have greater generating capacity in our electricity stations, selling from them more electricity and supplying more houses, farmsteads and workshops than ever before. This year also we are able to afford and are, in fact, providing far more for social welfare, education and health than ever before. Yet the share taken from the national product to finance all these manifold and expanding activities has remained virtually unchanged over the past six years.
Some may ask how the Government have been able to expand the whole economy and to provide so much more satisfactory public facilities and yet have left the rate of taxation imposed practically unchanged. We have done this by wise investment in the skill and intelligence of our people, by encouraging our producers to make themselves more efficient and by refusing to be deterred from attempting new enterprises simply because no one ever attempted them before. This is the sort of progressive policy of initiative and courage of which Deputy Cosgrave spoke.
I referred to the fact that today we have more schools and more pupils attending them than ever before. I know nothing that more accurately reflects the degree of prosperity and comfort existing in the homes of our people than the extent to which our children avail of the educational facilities available at secondary schools or higher levels. In this respect the contrast between the position as it was in 1961-62 and as it was in 1955-56 is highly gratifying. For example, in 1955-56 the number of children attending secondary schools as whole-time pupils was 59,300; whereas in 1961-62 it was 80,400, an increase of 21,000. In the earlier year, the number of pupils attending whole-time in continuation and technical schools was 21,300; and in 1961-62, it was 28,300—an increase of 7,000. In 1955-56, we had about 7,300 university or equivalent students; it is estimated that in 1960-61 it was about 12,500. In other whole-time educational institutions under various auspices, there were in 1961-62, 1,085 pupils as compared with 1,442 in 1955-56, representing a decrease over the period of 337.
Why was there a decrease? Because the parents of so many farmers' children, children who formerly would have gone for short-term courses at agricultural colleges and similar institutions, were able to afford to send them to universities, secondary, vocational and technical schools on a whole-time basis for a considerable term of years. Therefore, since 1955-56 the number of persons attending whole-time in secondary schools, vocational and technical schools, universities and other institutions above primary grade was approximately 113,500 or an increase of 33,000 over 1955-56.
Some Deputies may have heard Deputy Crotty speak. He was referring to the fact that apparently the rate of increase in employment in industry and agriculture was not as great as he anticipated it would be. He discounted entirely that 20,000 more are employed in industry than there were when he was in office as Parliamentary Secretary. Does not Deputy Crotty appreciate the significance of the fact that 33,000 more people, children over the age of 14, are at secondary schools than there were when he was in office? When the second Coalition were in office what was happening? The circumstances of the working class and the small farmers were such that their children were driven out to try to seek employment the moment they reached the age of 14. Today the parents of those children are able to give them the opportunity of secondary and, even in some case, of a higher education.
In his speech Deputy Corish made great play with what he described as the loss of employment in agriculture. But does the position to which he referred indicate a deterioration in the conditions of agriculture or of those employed in the industry? In my opinion, it does not. It would be theoretically possible to have heavy employment on the land provided one adhered to the methods of old-time husbandry. We will always have the obscurantists, the do-nothings and the what-nots bewailing the fact that men are being replaced by machines. But if men are being replaced by machines, so is the servile toil which used to mark agricultural employment in the past. If we had adhered to these methods of old-time husbandry, we should not have efficient farming, nor would farmers and their labourers have anything but a low standard of living.
The decline in the labour force on the land of this country is due not to any decline in the wealth or resources of our farming community, but to their increasing capacity to mechanise their farms and raise the efficiency of their farming. Naturally, this does lead to some displacement of labour; and the question which calls for investigation is where have these workers gone. Despite what Deputy Corish would suggest, I doubt if many have emigrated or have remained in the ranks of the unemployed.
The figures for attendance at secondary schools and other educational institutions above primary school level may throw some light on the problem. The total of males in all three categories of the classification "engaged in farmwork" was 360.8 thousand last year, as against 409.3 thousand in 1956. Thus there was a decrease of 48.5 thousand in the number so engaged. By far the largest of the three categories of farmworkers is that entitled as "members of family engaged on the farm." In 1956, 313.9 thousand males were so classified, but in 1962 there were only 285.0 thousand, or a decrease of 28.9 thousand. A proportionately heavier fall was experienced among permanent employees on the land, who numbered 55.9 thousand in 1956 and only 44.7 thousand in 1962, and in the number of temporary employees, which had fallen to 31.1 thousand in 1962 as against 39.5 thousand in 1956.
It is a recognised social phenomenon that no class of society strives harder to give an adequate education to its children than do those who live by the land. When we see that the number of members of families engaged in farm work fell, within the period 1956 to 1962, by 28,900, surely the question must arise as to what proportion of those were diverted from farm work to study, what proportion of them had gone to swell the number of those who were in attendance at secondary schools and other higher educational establishments in 1961/62. This attendance, may I remind the House, increased by 33,000 over the period from 1956. I do not suggest that the whole decrease of 28,900 in the number of family farm workers was absorbed by the educational system but I do suggest that a notably large proportion of it was.
I should like to turn now to a consideration of the position in some other occupations than the transportable goods industries. That there has been an increase in the latter sector is not questioned. Deputy Corish on Wednesday week conceded a figure of 20,000 but there are other occupations in which there has been a marked increase in personnel since 1956. These are the professions, for instance, including not only the law, medicine, dentistry, architecture and engineering, and veterinary, but all the ancillary professions such as radiography, physiotherapy, etc., etc. Then we have the teaching profession and the nursing profession, in particular that of mental nursing, a large proportion of whose members are recruited from rural families. Statistics for the growth in these professions are not yet available; but when they are published, the fallacy in Deputy Corish's argument will be more clearly revealed.
Another fallacious argument which Deputy Corish applied to the Budget is that the proportion of tax revenue applied to meet expenditure on social security was less than when he was Minister for Social Welfare. This emphatically is not the case. When the present Leader of the Labour Party was Minister for Social Welfare, the expenditure on social security, that is, on social insurance, social assistance and the administration of these services, defrayed from taxation, was £29 million or 31.9 per cent of expenditure on Supply Services. Last year, the amount provided under the same heading was £39.340 million or 33.3 per cent of expenditure on supply defrayed from taxation.
Thus, absolutely and relatively, the amount provided by Fianna Fáil to meet social security needs is substantially higher than when Deputy Corish had responsibility for it. In fact last year it was approximately £10 million or over 33? per cent higher. I may have misunderstood the drift of the Deputy's argument but it is one which he has made on several occasions here. It seemed to me that the Leader of the Labour Party was advancing the proposition that every time more money was provided for other services, there ought be an extension of the social security services also. In my opinion, that proposition is so patently absurd that I take it it is not seriously intended by any person who hopes at one time or another to have responsibility for any Government Department; but if it be intended seriously, just think of what it means.
I take it to mean, and nothing in the Official Report of Deputy Corish's speech suggests otherwise, that every time an increased amount is provided for agriculture, or for housing, health, the Army, the Guards, or education, a proportionate amount or an equal amount—Deputy Corish did not make it clear which—is to be raised for further social security benefits. Perhaps Deputy Corish, when he has had the opportunity of reading this speech, will tell the House why it should be. By what argument does he justify his proposal, on what principle does he base it? This plan of his, if given effect to, would have three consequences: it would make the supply Budget unmanageable; it would soak the producers and make their position intolerable; and it would make life a bed of roses for the workshy.
The Leader of the Labour Party also seemed aggrieved that taxation is not heavier. He complained indeed that we are among the more lightly taxed countries in Europe. Well, we are certainly not among the more heavily taxed. Nevertheless there is a feeling abroad, and it is very widespread among workers, even among those who vote in Dublin North-East, that we are sufficiently taxed as it is. However, it is perhaps as well that the workers should know in time that if ever the Labour Party formed a Government and Deputy Corish became Taoiseach, one of his primary objectives would be to jack up taxation here to British and German levels.
This will be cheering news for all income tax payers, who are now approaching 300,000 in number, and a vast majority of whom are industrial wage earners or white collar workers, striving to bring up their families and keep up a decent appearance on meagre salaries. I hope the Labour Party candidate, Mr. Larkin, in the course of his peregrinations throughout the constituency, when he is addressing white collar workers, and particularly the lower paid civil servants, will tell them of the Labour Party's policy of jacking up taxation here to the British and German levels. Of course, Deputy Corish may disclaim any intention of soaking the mere income taxpayer and claim that his real quarry is the person who pays surtax. There are 4,000 such people with salaries of £2,501 and upwards. They are already paying in income tax and surtax anything up to 15/- in the £, depending on their income. Over and above what they paid in income tax last year, in 1961-62, they paid £2,226,000 in sur-tax. We all heard the fable about the man with the goose which laid the golden eggs and who was not contented with what he had. Deputy Corish is possibly in the position of that man.
Many of these people have been attracted here by the fact that our existing rates of tax are in some sections of the income scale lower than in Great Britain. Such people provide, relatively speaking, a great deal of employment, domestic and otherwise, and contribute substantially to our loans. And if they go, shall we not lose, not only the employment arising here from what they spend, but the tax which they pay to our Exchequer, and the contribution which their capital —and it is very important—makes to our economic development as well?
But while Deputy Corish grumbles because taxation is not heavy enough, Deputy Dillon is dissatisfied because he contends that it is the heaviest ever. I think I have shown how shallow and unthinking is the Labour Party's approach to the problem of taxation. Mercifully, I am not called upon to give equal consideration to Deputy Dillon's assertion, for one fact in itself and the conclusion to be drawn from it, confutes him. And the fact is that the total amount collected in taxation in 1962/63 represented 22.6 per cent of the gross national product, and this Deputy Corish says is too little. Deputy Dillon says it is too much.
For the year 1956/57, which the House will recall was the last Budget year of the second Coalition Government, of which Deputy Corish was a member, the percentage of the gross national product taken in taxation was 22.6, that is to say, was exactly the same.
But in relation to Budgetary problems, 1956/57 is of peculiar interest. In that year, Deputy Corish was not to be heard calling for an increase in direct taxation. Nor was Deputy Sweetman.
Instead these two Deputies, then colleagues in the last Coalition Government, combined on two occasions to impose the most oppressive blanket of indirect taxation that they could devise. It covered virtually every sort of article or commodity, in domestic, business or industrial use. Food—the Fine Gael Party and the Labour Party are very voluble about food now—clothing, fruit, furniture, domestic appliances, clocks, plastics, haberdashery, household sewing machines, office equipment, toys, typewriters, pens, all were taxed.
Bread, butter, tea, sugar and beer were not. I could go on also.
And they were taxed not at the nominal rate of 2½ per cent, but at rates ranging from 3 3/5 pence per lb. on unprocessed fruit, and 4 4/5 per lb. on certain tinned fruits, up to 60 per cent on a wide range of articles, with an almost equally wide range taxed at 37½ per cent, with a comparatively limited range taxed at 15 per cent. I suppose when they came to consider articles taxed at only 15 per cent Deputy Sweetman was amazed at his own moderation.
Need I tell the House that, despite the burning repugnance to indirect taxation which he expressed here last week, Deputy Corish did not resign from the Government. Nor did Deputy Sweetman, despite his speech of last Tuesday, increase the income tax. Moreover he did not come within millions of balancing that year's Budget, despite all these exactions.
I came much nearer than your Minister did last year. Do not forget about revenue balances.
Now, one word about the turnover tax in the present Budget. Unlike Deputy Sweetman's oppressive levies, the proposed new tax is not a tax on commodities, nor is it a tax on sales, as such. It is a tax on retail turnover, a tax which falls in the first instance on the retailer, but which the retailer is free to pass on like any other expense to his customers to the extent that market conditions will allow. But he is not called upon to pass it on in the form of a surcharge on every article he sells. That disposes of the ridiculous speech made by Deputy Crotty, a speech which is only matched by that delivered by his leader last Wednesday week. The retailer may impose a surcharge on everything he sells; or on only a selection of the things he sells; or, if it suits his business best, he may make no surcharge at all. All this is at his own discretion.
Thus, all the talk there has been in this House, about taxing a reel of thread and a box of pins or an ounce of knitting yarn, such as Deputy Dillon indulged in, was unadulterated dithering.
Tell that to the shopkeepers.
So also was the fanciful picture of the expense and inconvenience to which traders would be put in computing and paying their share of the tax. In that regard, there is only one simple fact to be determined; one simple calculation to be made; and one simple operation to be performed.
The simple fact to be determined is what was the turnover for the month of the business concerned, and that should not give the proprietor any trouble at all; the simple calculation to be made is to ascertain what does 2½ per cent of the ascertained turnover amount to, and that should not give the proprietor any trouble; and, finally, the simple operation is to fill in on the Revenue form provided the figures for the turnover for the month concerned, to write out a cheque for 2½ per cent of the turnover, and to put cheque and form in the Revenue envelope provided, post it to the Revenue Commissioners, and the whole thing is done.
I note, however, that despite the extreme simplicity of the whole process, there is a tendency in some quarters to exaggerate its complexity and to try to make a mountain out of a molehill.
In another quarter, a gentleman, professing to speak for a business which its customers believe has been unduly sedulous in looking after its interests to their disadvantage, is already looking on the tax as presenting the trade in question with an opportunity to profiteer, and to collect more from the public than would in any circumstances be warranted.
It is to be hoped that his proposal will not be pursued, for if it should be, it will prove ultimately not to be to the advantage of the business concerned.
I have kept the House too long I am sure——
Not at all. You are welcome.
I must have made some impression. I hope it was favourable.
You have given me more election points than I have had for some time.
Do not forget the Deputy once had a narrow escape and if he indulges any more in any election campaigns such as he indulged in in 1956-57, much as I might regret it, we may miss his presence in the House.
Do not worry about that. The Tánaiste had a much narrower squeak.
I am here now. Is that not where you would like to be? I want to refer to, and repeat, what the Taoiseach said in the House on Wednesday last when he made these three points about this Budget and our policy. The first is:
This Budget rests on the proposition that economic and social progress require increased Government spending ... We can cut down on Government spending only by cutting back on economic and social improvement——
That, of course, was the policy which Deputy Sweetman committed himself to on Tuesday week last when he said that he was going to have a freezing of all the provisions made for the Supply Services, no matter for what purpose. Having regard to the fact that these are mounting and that people are naturally anxious to improve their position and their share of the national loaf, that would only mean that somebody would——
Will the Tánaiste quote me, not misrepresent me?
I could not possibly do that. If I quoted the Deputy, I should just be saying what I am saying now.
The Minister would not. He knows that is not true.
We have all this talk about economic development, what they would do if they were in office, how taxation would be lighter with no necessity to borrow, the National Debt not increasing and therefore provision of additional taxation to meet increases in National Debt would not arise either. Now will some of them get up and boldly say what one of the services does he propose to cut? There has been a considerable increase in the amount provided for education, in the amount provided for health, in the amount provided for social welfare, in the amount provided for industrial development, in the amount provided for agriculture. Which of these would Deputy Sweetman cut back in order that he might establish the expenditure-freeze of which he spoke on Tuesday last?
Let me continue with the quotation from the Taoiseach because it is on that I want to sit down.
You are going to deal with revenue balances and corporation profits tax first?
No.
I thought you would funk it.
No. I will deal with the revenue balances.
Do, please.
The introduction of the new taxes——
I am glad I made you do it.
The introduction of the system of PAYE makes it no longer necessary or, indeed, desirable, to maintain the revenue balances at the amount at which it was necessary to maintain them when we had less expeditious methods of securing the necessary revenue. We are not securing any greater part of the national product in revenue but the flow is evener; it is coming in a much more even flow now than when Deputy Sweetman was Minister for Finance and when I was Minister for Finance and, fortunately for Dr. Ryan, he is able to take advantage of that fact and is able to give to the taxpayer in this year the benefit of the surplus which has accrued in the Exchequer account.
It has not.
That is the whole position and Deputy Sweetman knows that as well as I do.
The Tánaiste knows very well that it is a fake transaction.
It is quite clear that Deputy Sweetman does not like hearing what the Taoiseach said. So I repeat it for the third time—this time, I hope, without interruption. The first thing the Taoiseach said is that this Budget rests on the proposition that economic and social progress require increased Government spending. That cannot be gainsaid because, as the Taoiseach said, we can cut down on Government spending only by cutting back on economic and social improvement. Finally, the third thing he said is this—and this is, of course, what annoyed Deputy Sweetman and the others opposite:
The Fine Gael approach, as disclosed in Deputy Dillon's speech this afternoon and in speeches made by him and his colleagues yesterday, is negative, deflationary, timorous, political in the extreme. The Fianna Fáil attitude is, and I hope will always remain, positive, constructive and national.
And so say all of us.
What about the corporation profits tax? The Tánaiste promised to deal with that, too. He is running away from that still, is he?
Deputy MacEoin has been very patient. He has been sitting here for quite a long while. I am quite prepared to give him his chance.
He is quite prepared to sit here and let the Tánaiste deal with it.
It is amazing that the Tánaiste could say so much about so little and say nothing upon the subject that is under discussion. We are discussing the Budget of 1963. He has dealt with external relations, with what the inter-Party Government did, with what they did not do. He commented on their sins of omission and sins of commission and as far as he was able, he, like the Minister for Finance, has tried to cloud the whole issue, to conceal the actual position.
This Budget faces three ways. I should not like to describe it as the three-card trick but it is very close to it and resembles it very much. The Tánaiste says two things. First, he says that the trader, the merchant, may pay the whole of the 2½ per cent tax or, he says, on the other hand, he may put portion of the tax on some items and, of course, that it would be impossible for him to put it on the box of matches or the packet of cigarettes. When Fianna Fáil will be talking to the trader they will be quite clear and definite in saying: "You can recoup yourself in full for the amount of the 2½ per cent tax" and when they are talking to the consumer they can say: "You will not have to pay it at all. The trader will have to pay that." Then we find a third picture being painted. The Government say that it is easily paid. The Tánaiste described the simple method by which 2½ per cent would be collected upon the gross turnover of goods and services, which has been calculated at various figures but which, it is agreed, is greater than £600 million. He suggested that it is a very simple matter to extract 2½ per cent on the turnover of £600 million and that, of course, they have to do it only once a month. Therefore, there is this exercise that the small and the large trader will have to undertake. This exercise will be imposed upon them. If anybody thinks that the traders like it, they must also think they are great patriots because I cannot see the traders or the big combines or the big concerns doing all this for the sake of Kathleen Ní Houlihán. Yet, that is what the Tánaiste would have us believe, that it is so simple that they will really like the operation and will pay the 2½ per cent without question.
I am amazed at the picture which Fianna Fáil can paint of every Budget that they have introduced since they came into this House. Every Budget they have brought in has been in the interests of the people—national effort —national endeavour. When the Tánaiste was speaking I felt I should like to look at the speech the Taoiseach made on 15th October, 1947 when Fianna Fáil were introducing their Supplementary Budget. I quote from the Taoiseach as reported at column 392 of the Official Report of 15th October, 1947:
The Minister for Finance will give you, in much greater detail, the picture of our economic conditions in relation to general world conditions. At this stage, I shall merely sum up by saying that our position is serious and calls for grave thought and well considered action, not by the Government only, but by all sections of the community. There is good reason, however, for confidence that, with goodwill and hard work, we will overcome our difficulties, which are far less grave than those being encountered at present by other countries.
As I say, the position is a serious one. In some respects, the dangers and difficulties are greater than they were at any time during the war. There is no ready-made solution, no rule-of-thumb method of preventing hardship. Our immediate task is, as it was during the war.
——It was right to wave the old flag——
—to reduce to a minimum the burden which the community as a whole must bear and to distribute it as equitably as may be humanly possible among the different sections of our people. The long-term task is to increase our production, our output of food and manufactured goods, and to make all our services efficient to the maximum extent. This can only be accomplished by hard work and willing acceptance of the sacrifices which, in the present circumstances, are inevitable.
Cheers! That was the head of the Government speaking in October, 1947, of the hardship and difficulty of extracting £5½ million more from the people. He told us it was essential to do that Of course, what annoys the Tánaiste and the Fianna Fáil Government is that they have an uneasy conscience because when we took over the following year, we removed that burden.
May I point out that we cannot have a full-dress debate on the 1947 Budget?
I sat here for the past half- hour listening to the venerable Tánaiste dealing with the evils, and the sins of omission and commission, of the two inter-Party Governments during the years 1948 to 1951 and 1955 to 1957. I am simply replying to his comments and saying that because we took over and relieved the people of the imposition of that burden, Fianna Fáil will never forgive us. We eliminated the hardships that were to take place but did not take place. Today the Government are imposing not £4½ million but £12½ million in a full year of new taxation, at a time when they admit the deficit they require to cover is not more than £4 million when the Exchequer balance is taken into account. With a buoyant revenue last year from PAYE, they should have been able to maintain and increase the services without difficulty.
How do we intend to compete with other countries in the world markets? By imposing a further burden of taxation on our people. The President of the United States, speaking last week, declared that unless Congress carried through the tax reliefs and concessions he proposed, there would be greater unemployment in the United States than there is at the moment. One of the points he made was that taxation must be reduced by hundreds of billions of dollars. For what purpose? To enable production to take place, and to leave more money in the hands of those who earn it, thereby creating a buoyant economy.
The Chancellor of the Exchequer in Britain budgeted for a deficit and he followed the same line of thought. He declared that purchasing power must be left in the hands of the people. A very short time after the British Budget we find that 90,000 more people are employed than were employed prior to the Budget. Unemployment has fallen by 90,000. It has been argued that that is mostly seasonal employment. That may be the reason for portion of the drop in unemployment, but still it is a very striking figure.
We were asked what we would cut. That is an old trick. Deputy Burke, speaking for the Fianna Fáil Party, I suppose, bled for the Old IRA. I am glad the Minister for Defence has come into the House because Deputy Burke said they would gladly pay for everything that was necessary but they had not the money. That was not the defence of the Minister for Defence in refusing my motion and calling upon Deputy Burke and the rest of the Fianna Fáil Party to vote against it. What was his defence?—that they were well and generously treated, not that there was not enough money. Deputy Burke is the other side of the coin. He will speak to the people of Dublin and he will be able to repeat what he said here on that matter, and he will say that now the IRA are bound to get what they are entitled to, and what the Minister and Deputy Burke would gladly have given them, if they had the money. They will have an excess of about £8 million now. Will the Old IRA be dealt with now? Let us hope so, but I do not believe they will.
Bearing in mind the 1d. a gallon that was given on milk, I wonder what do the Government think the dairy farmers feel about the turnover tax. With the increase in the cost of living, the increase on the rates, the 2½ per cent. increase they will have to pay on the price of fertilisers, and the increase on everything they have to purchase, not only will one penny be eaten up but twopence will be eaten up, and they will be worse off—50 per cent. worse off—than they were before they got the 1d. on the gallon of milk, out of a Budget in which it is admitted that there will be a surplus of £5 million to £7 million next year.
In my view, the turnover tax will eliminate the small trader. It appears to be the policy of Fianna Fáil to eliminate the small trader and the small farmer. The day that happens will be the worst day in this country's history, because, remember, it was the small trader and the small farmer who bought for us whatever bit of freedom we now enjoy. A very prominent Fianna Fáil spokesman said to me quite recently that the Civil War was bound to occur because, he said, the revolutionary of the 1916 to 1921 period was the shopboy, the shop assistant, the carpenter, the tailor and the blacksmith; they eliminated the upper middle-class, who had been the leaders of Irish thought prior to that and, he said, they themselves, in turn, had to be eliminated.
Now the Government set up by the shopboy, by the carpenter and the blacksmith are to extinguish the class that put them into office. It is an extraordinary turn of the wheel and when to-day I heard the Tánaiste referring to our repeal of the External Relations Act, and the bad day that was for our trade with Britain, I vowed to myself one solemn vow that I would have his speech photostatted, when it is printed in the Official Debates of this House and send a copy to every person who was in the Four Courts in 1922 and who is alive to-day.
I will send it to the Minister for External Affairs, too; it was he who, in my presence in Athlone, declared that the British market was no longer available, and that it would be a great blessing if every British ship were at the bottom of the sea; and, when opposition was voiced and it was pointed out we would face hard times, he said: "Not at all. We will have the best times ever. Instead of having to tighten our belts we will be able to loosen them." I will send him now a copy of the Tánaiste's speech this morning. I should like to say to him, too, and to the Tánaiste that, if there was any inconsistency, which there is not, but which he tried to pretend there was, in the Front Bench here, the inconsistency is much greater over there where collective responsibility now rests. The collective responsibility is vested and now lies in that Front Bench there as the Government, not with the Front Bench here, or with the Labour Front Bench. The Front Bench over there should take good care that, when they say something, they are in harmony and unison and there is no contradiction in policy.
We get the Taoiseach then, when speaking on this Budget, asserting that the swing is now to the left. What exactly does he mean? I should like to ask you, Sir, and everybody in this House, to consider what that phrase means. It has a well-known interpretation in international parlance. If you were to see a newspaper tomorrow stating that the Italian Government are swinging to the left, what interpretation would you take from that? If you saw a declaration by the Premier of Italy that he was swinging to the left, what interpretation would you take from it? The phrase has only one meaning. It is a phrase that should never have been used. You may say, if you want to, that you want to build up an affluent society. You may say that you want to have, if you want to, christian socialism. You may say that there are steps you would like to take, more extreme steps, for the education of our people. But "swing to the left"! I do not want to labour it, but when we are attacked here by a veteran like the Tánaiste, whom some would take seriously, we are compelled to reply. Indeed, I saw a young Deputy sitting behind him, smiling with the greatest of pleasure and delighting in the old warrior's attack upon my colleagues here.
There are many more things I should like to say but I do not know that it would be any advantage to say them. I must, however, go on record as protesting against the corporation profits tax being made retrospective. I have some small association with a few firms, firms that are just surviving. In my opinion, this imposition will send them to the wall. Is that what the Government want? If it is not what they want, then it is even worse because they are doing something they do not properly understand and the implications of which they have not properly examined.
The imposition of tax upon the co-operative societies is a retrograde step. These societies have been of great assistance to Governments of this country. They have done much to assist the agricultural community, the dairy farmers and others, to get sale for their produce. Mark you, they have acted as bankers for the farmers when it was difficult for them to get credit. Now there is to be a further burden on the farmers by this imposition on them in their co-operative capacity. It is true that the Minister has said that it is only upon the non-agricultural things they sell that the turnover tax will be imposed. The profit made by the co-operative societies helps them to pay better prices to the suppliers of milk to their creameries and to give long-term credits for seeds and the other things in which the co-operative societies engage.
Recently I saw an article in The Kerryman. It was a statement from the Vice-President of the National Farmers' Association in Cork. He said they were disappointed with the Budget because it did not give credit for the first £20 valuation on agricultural land. He went on to say :
Local government expenditure will be increased as a result of this Budget. It will increase beyond the estimate recently provided for the services in county council estimates. County councils will have to pay more for their raw materials of various kinds, cement, food, clothing, equipment, machinery, and many other items. The effect of this will be felt in the local rates next year as a result of the supplementary estimates that the council may bring in. This will all add up, I am afraid, to a heavier load on the already overburdened farmer as a taxpayer.
That is a well thought-out analysis of what will be the results of the Budget proposals.
The Government have reverted to their old philosophy. I said—and I do not intend to go into it again—in 1935, 1936, 1937 and 1947 that Fianna Fáil had adopted the landlord philosophy: the higher the rent on the tenant, the heavier the load, the kinder he will draw. That continues to be their philosophy. I hope when the people realise the nature and the extent of this Budget, they will call on the Government in no uncertain fashion to resign and take the consequences and let a Government in who will carry out their programme and their promises.
In Fine Gael, we have a programme and a policy which when put into operation will, for the first time, in my opinion, give the Irish people an opportunity of earning a livelihood at home. We go so far as to say that we can substantially reduce the rates in both town and country. Finally, that programme will bring about increased production, national prosperity and the realisation that the Irish man or woman working at home in Ireland has the first claim upon his or her own earnings. I assert that there is no person better entitled to spend my money than I am who earned it.
In the forge long ago, the more I worked, the more I earned. If it was going to be taken from me in income tax, I would have stopped short. If I could get for ten sets of shoes only the same amount as I could get for four, I would stop at the four. When I knew that every set I put on meant greater compensation, then the result was increased production, greater output. Until the Government gives the worker and the industrialist compensation for their labour and effort, production will not increase.
The lip service now being paid by this Government to the Irish agriculturist is a deathbed repentance. The one ambition of the Taoiseach, when he was Minister for Industry and Commerce in previous Governments was to set up industry at any cost and at any height of protection. The farmer was of no great import. Of course, he was right to a certain extent because when in 1948 the skin of a calf realised 10/-, what use was it to do anything on the land? What was the use in fertilising or draining land? We reversed all that, notwithstanding the Tánaiste's declaration that the 1948 Trade Agreement did not meet the situation. It may not perhaps have met it from the industrial point of view but it was a positive improvement which proved of great advantage to the agricultural community if it did nothing but change the price of the calf from 10/- for his skin to £12 per head.
This Budget has been ill-conceived. It is badly thought out. There are other methods which could be utilised such as a purchase tax. The one they have adopted is the one that will impose the greatest hardship and bring in what I thought was dead for ever as far as Fianna Fáil were concerned, that is, the full of the ditch of inspectors. The Minister for Finance in his speech has said they reserve to themselves the right to inspect and investigate. I wonder how many new jobs there are in that. I only hope it will not be necessary to be a member of a Fianna Fáil cumann to get one of these jobs because it will be a smasher. Not even in the palmiest days of the Boston Circle could they have thought out a plan under which there would be as much trickery and tax evasion as there will be under this type of administration.
I do not propose to speak at very great length on this Budget. The overall taxation picture is that the Minister cannot make up his mind whether to have in this country a continental system or to continue with the old income tax code which we had up to this. The implementation of this turnover tax gave the Minister a golden opportunity to abolish Schedule A tax and so release some of his Department to work on the new tax. The Schedule A tax, as I understand it, brings in only something over £1 million and I would ask the Minister to consider abolishing this tax.
The Minister said that the cost of collection of the new turnover tax would be only one per cent. I heard the Minister for Justice tell the House that the reason the cost would be so low was the new computer the Department proposes to have in operation, I think, some time in June. While I bow to the Minister for Justice in his knowledge of what a computer can do, I do not think a computer will be able to call in on all the small shopkeepers and harry them into making the necessary returns. If the computer can do that, it must indeed be a very wonderful machine. These froms when they have been completed, must be checked. While the computer, I am sure, would be very good at checking the forms, somebody has to send them off again to the business people and shopkeepers and they also have to collect the tax.
I think the Minister, in changing the assessment of non-business premises from Schedule A, as it has been hitherto, to Schedule D will hit widows and also retired people. I should like to make a strong plea to the Minister to go back to the old system and to leave them under Schedule A.
Up to this, when a wife had lost her support, she was able, if lucky enough to have a house, to let portion of it in order to make up her income. Furthermore, numbers of people, in contemplation of their retirement, bought property, expecting to receive the rent. They will be hit very hard by this new tax.
All the speakers on the Fianna Fáil side of the House stressed that the new turnover tax need not be imposed by the shopkeepers. I overheard a Dublin business man speaking to a friend. He said his company were considering an all-round increase of between six and seven per cent to cover the 2½ per cent. turnover tax, to cover the cost of collection and also the cost of the additional book-keeping.
When Fianna Fáil speakers say that business poeple and shopkeepers need not pass on the tax, they are hiding their heads in the sand. I am quite certain that when Black Friday, 1st November next, dawns and when the people look into the shop windows they will then see that they—the public—will have to pay this tax and that all items—tea, sugar, bread, butter and everything else—have been increased by considerably more than 2½ per cent.
I wonder if the Minister has considered the effect of this tax on rates? As a member of the Dublin Health Authority, I have been wondering what effect it will have on that body. I do not know whether the Minister has finally decided that this tax will apply to medicines but, assuming it does, the increased amount for health charges alone in respect of Dublin city, Dublin county and Dún Laoghaire, will be £100,000: that £100,000 gives credit for the same amount being paid by the Minister in his 50 per cent grant. That, I feel, will be a very heavy burden. However, the ratepayers of these three authorities will also have to meet a tax on the other items. When one considers all these matters, one wonders how the Taoiseach, when speaking in this debate, could say that the cost of living would go up only two per cent. I certainly feel it will be at least four per cent.
I wonder how this new turnover tax will affect people such as architects, auctioneers and stockbrokers. An architect, when he designs a house, does not see any of the purchase price of that house and I assume that the tax will apply only to his fees—but that is not at all clear. An auctioneer is in a slightly different position in that, if he sells premises by public auction, he receives the deposit, that is, one quarter of the purchase price. That is the last he sees of the purchase money. In only a very rare auction will he see the rest of the purchase money. A stockbroker is in a different category because he receives the purchase money. Whether it be buying or selling shares, the total purchase price of the shares passes through his hands. Will he be subject to the tax only in respect of his commission or will it be on the total purchase price of the stocks and shares he has dealt with?
I am glad the Minister in this Budget proposes to reduce the stamp duty on certain transfers as from, I think, 1st of August. That, I take it, is an effort by the Minister to keep the Dublin Stock Exchange on a par with the London Stock Exchange. If this new turnover tax is to apply to stockbrokers in respect of the full purchase price of the shares in which they deal, then the Minister in one part of the Budget is endeavouring to price the Dublin Stock Exchange into the market but in another part, he is pricing them out again. It may be that I am wrong —I hope I am—and that in respect of the three categories I mentioned— architects, stockbrokers and auctioneers—if the tax will apply to them at all, it will apply only to their commission.
There is one other matter I should like to raise with the Minister. In the second paragraph of the second White Paper on Direct Taxation, there is a proposal that the system of collection of surtax be changed and that surtax be payable on 1st of January in the year of assessment instead of 1st of January of the following year. Does that mean it is proposed to skip a year, or is it proposed to collect two years at one fell swoop? I would ask the Minister to consider that. It is a matter that will arise certainly on the Finance Bill, and possibly when we see the Finance Bill, we will be better able to deal with it. Meanwhile, perhaps the Minister would look into it.
Anybody listening to the violent attacks which have been made upon the Budget can only be driven to the conclusion that they were prepared and premeditated before the Minister even entered the House. It was inevitable that the terms of the Budget would include some form of taxation, and criticism of it was to be expected. But the attacks make one suspect the Opposition are cynical and are concerned not so much with the alleged burden placed on the people but rather with their own anger and disappointment that some exorbitant and startling tax had not been introduced.
The turnover tax is neither startling nor exorbitant. By no stretch of the imagination can it be described as a tax which the people will be unable to bear. It is a fair and equitable tax, so evenly spread over the whole community that it can be met without any intolerable strain on the individual purse. The tax has the added virtue that it can ensure for the Exchequer a steady share of the increasing national wealth. Real national wealth is increasing, and it bids fair to continue increasing, despite the attempt of Opposition Deputies to prove otherwise.
This increased national wealth, in which every section have been able to share, has come about as a direct result of the Fianna Fáil policy of industrial expansion, in spite of cynical criticism from the Opposition. It would be amusing, if it were not tragic, to hear the Budget described as a brake on industry, as if the Government would be responsible for deliberately obstructing the forward march of an industrial movement for which the Government alone are responsible. There is a mass of legislation on the Statute Book offering to industry inducements of all kinds —grants, loans and incentives. All of this legislation bears witness to the sincerity of Fianna Fáil in their avowed aim to provide remunerative employment for the maximum number of people.
Speaking of employment, one is led to the inevitable comparison between conditions as they now are and those which obtained in 1956-57 when, under a Fine Gael dominated coalition, unemployment rose to the staggering total of 97,000. As a result, a blanket of gloom and depression descended upon the country. Only the intervention of a sane, intelligent, progressive Fianna Fáil policy saved the country from disaster at that time. The country was saved not alone by the policy of the Government but by the extent of the co-operation of the people, workers, management and trade unions alike.
We on this side of the House believe we can depend on the people to realise that the moneys raised from taxation will be returned to them by way of increased employment, higher wages, better social benefits and a higher standard of living. There is no easy road to national economic and social success. Nothing good, sound or lasting can be achieved without effort and some sacrifice. Any attempt by Fine Gael to imply that an easy living can be achieved by waving some magic wand merely demonstrates that Party's lack of faith in the intelligence of the Irish people.
Progress reported; Committee to sit again.