We drained the land; we built the houses; we reduced taxation; and in 1951, we had it to tell that we had doubled the volume and trebled the value of the exports of this country. Was that a fair record? They will not listen. How could they listen and sleep again? The deficit this year, after adjustments, amounts to about £6.4 million. We are told it is necessary to budget next year for £13½ million. Are we to expect no buoyancy in revenue? Are we to expect no improvement in world commodity prices to relieve the burden of our present high rates of export subsidy? Are we to expect no reduction in the cost of living? Are we to assume that there is no economy capable of being made in the administration of the Government worthy of consideration?
When I look at the Minister for Transport and Power pouring forth his soul at dinners and dog fights throughout the country on how best to cook, where to get the nicest wine and how to sow a seed better than it has been sown before, and then look at our Minister for Posts and Telegraphs, a decent and kindly man, but now so tangled and wrapped up in the telephone wires of this country that they will serve no purpose but to trip him, I often wonder could we not combine these two offices and save some of what we are spending on them.
Is there no scope for consolidating the labours of the Minister for Lands, who has begun very recently to invoke the law against anybody who black-mails people or forces them into helicopters, with those of our Minister for Agriculture of unprecedented zeal and diligence. I venture to swear that the weakest potential member of my Government could do more for both those Departments with one hand tied behind his back than those two Ministers have done in the past seven years. The Taoiseach may laugh but is it not a humiliating experience for his Minister for Agriculture to be left discreetly at home whenever he goes forth to negotiate on agriculture? He may not realise that the neighbours understand the significance of that gesture on his part, but they do.
I want to make this suggestion to the House and I think it would effect a very necessary and vital reform. The time should be gone when protestations would ring about this Chamber as to one Party in this House being more anxious to improve the social services than another. I do not believe there is any Party in this House more anxious to help the poor, to improve social services, than any other Party. I believe Fianna Fáil want to do it; I believe Labour want to do it; I believe Fine Gael want to do it; but there is a difference in our approach to this problem.
We have consistently believed on this side of the House that what matters in regard to social service payments is not primarily their cash value but their real value. It is for that reason when we were in office that we spent £9 million a year to keep down the cost of living so that if our circumstances permitted us to add a halfcrown to the old age pension, it was a real halfcrown, a halfcrown that bought something. What are the facts today? We are paying an old age pension of 32/6 a week. How does that compare with the pension paid pre-war? Pre-war the basic pension paid was 10/-a week. Today it is 10/10d. That is all the difference. The pension the old age pensioner is getting today is worth 10/10d. in terms of 1938 money.
Why is that? It is because every time Fianna Fáil have got into office they have declared that it is part of their policy and that they believe that the cost of living should be allowed to go up. They do not think it is right to subsidise foods; they do not think it is right to control prices; they do not think it is right to preserve the real value of money. Their attitude is: "Let it rip but as the inflation grows, we shall scoop a bit more into the Exchequer and dole it out again. Then we can boast that we are the people who want to improve the social services." But the net result of all their operations is that after 25 years, the old age pensioner is, in effect, getting 10d. a week more than he was getting in 1939. A large part, not all, of that erosion of the value of the social service payments is due to the considered and deliberate policy of Fianna Fáil in letting things rip.
All of us know that in the war years money values declined all the world over but in this country, with Fianna Fáil in office, the cost of living steadily rose. Therefore, perhaps there is something we could argue about. Let us all agree that Fianna Fáil want to improve the social services; let us all agree that Labour want to do it; let us all agree that Fine Gael want to do it. But let us ask ourselves: are we honestly concerned to put more effective purchasing power into the hands of the old age pensioner, into the hands of the widow, into the hands of the unemployed and disabled, or are we content simply to keep raising the "ante" and smirking behind our hands: "They think they are getting three times what they did but the real change in 20 years is 10d."?
There is that difference between us. I think I am right and that Fianna Fáil are mistaken. I believe that in the march of inflation, it is the poor who suffer and the rich who come scatheless from the fray. Let us face it. A person who has to spend all his wages every week, a person who is living on an old age pension, cannot find the time or the opportunity to play ducks and drakes with altering exchanges. But the man who has £10,000, £20,000 or £40,000 in investments can change from one type to another. He can change from equities to gold and from gold to land or property. We have seen it done. What do you think the people who are buying the land from under our feet in Ireland today are doing? They are not fools. I said before in this House, and I say it again, the mobile operator wears diamonds around his waist but the stable operator buys agricultural land. He is no fool. He knows the difference between 10/10d. and 32/6. But the defenceless whose weekly allowance is just enough to keep the wolf from the door must take it as it comes.
We have always been concerned to mitigate that situation as far as we could. I think we were right; I feel that Fianna Fáil were wrong. Mark you, I refuse to accept the growing world philosophy that the ideal to be aimed at is that the State is to take over everything, including all family responsibility. I believe that in the countries of the Communist philosophy, the purchase price of that kind of care is freedom, but while they may have care from the cradle to the grave, they have it as creatures of the State. I believe that in free societies the desire to attain to that end is operating under our eyes around us in the world to destroy the moral fibres of the people who seek it.
I believe that ours is the better way. I believe our philosophy — which actuates all Parties in this House— to be the sounder one, that is, to see that we stand vigilant to protect our people from hardship and that wherever hardship manifests itself, without any doctrinaire solicitude about daft theories, we will go to their aid. I remember not long ago in this House I had occasion to question the Minister for Social Welfare about the circumstances of a widow. The Minister answered very fully and I pressed the matter further. I went out shortly afterwards to have a cup of tea and a well-known columnist from New York came to me and asked me if he could talk to me and I said: "Why not? What do you want to talk about?" I thought he wanted to talk about the approaching visit of President Kennedy. He said: "I will tell you. I am a columnist who has sat in every deliberative assembly in the world and this is the first assembly in which I have seen a Minister brought to answer for the welfare of a widow." I remember saying to him that that was in no way strange to any Deputy in Dáil Éireann and that those were matters with which we were perennially engaged.
I told him the story of the late Deputy Alfie Byrne who, when a young Deputy came in here, took him aside to give him advice. One piece of advice he gave was: "Whenever you are approached by a widow, whether her case is good or bad, reasonable or unreasonable, receive her with a smile and hear her story and do what you can to help her because she has met enough adversity in the loss of her breadwinner to entitle her to a kind reception if she looks for help." That is a good philosophy and I believe that, fundamentally, it is the philosophy underlying the approach of all sides here to social services. I believe it is the right approach. I believe the approach which is conscious in an intimate way of our neighbours' problems and difficulties and feels that it is our obligation to go to their aid in so far as our resources will allow, is a sound approach to this whole problem. So far as I know, it is common to every side of this House and I think it is time we stopped suggesting that there is any element in our Legislature which is indifferent to it.
Now I want to come to the net problem of the poisonous character of the proposals in this Finance Bill. I want to say with full deliberation—and I must declare ad interim that I am myself a shopkeeper and have been engaged all my life in the retail and distributive trades and my colleagues are entitled to be expressly informed of that fact; it may give me a personal interest but it also gives me an encyclopaedic knowledge, the benefit of which I propose to offer to my colleagues in this House—this turnover tax is unjust and inequitable because it makes no distinction between the purchaser of caviare and champagne and the purchaser of bread and tea. It makes no difference between the customer for a fur coat and the customer for boots or clothing and the necessaries of life. It makes no distinction between the customer who through his circumstances must spend his entire week's income every Saturday to meet domestic needs, and the customer who is spending perhaps one-quarter of his annual income.
Is it equitable or just to say that the man whose earnings and family commitments require him to spend all his earnings is to bear the same percentage of tax as the man with an income which enables him to save without difficulty three-quarters of his annual income? Outside of Bedlam was ever anyone found to defend as equitable and just a tax on such a foundation? It is unjust. The consumer must pay it and, mark my words, this is throwing on to the shopkeepers the obligation of collecting it and furnishing monthly returns and paying over that tax without any reference to the profit of the trade they do.
Surely there is still a sense of justice in this House. Have Deputies wondered what this tax means; what it means in respect of the law-abiding respectable shopkeeper in this country? In certain cases they are going into the man trading legitimately and saying: "We are going to put a corporation profits tax of 62½ per cent on your profits whether you are incorporated or not. Of course, you have leave to pass it on to your customers." All my life I have been engaged in the retail and wholesale distributive trades and I want to tell Dáil Éireann what the effect of this tax is going to be.
It is going to have a double consequence. It is going to wipe out of existence a large number of small shopkeepers and I can well imagine that the faceless bureaucrats who stand behind Ministers for Finance will say: "After all, that is a damn good thing. They are inefficient and it would be much better to eliminate them. They are surplus and inferior operators and in the name of efficiency they ought to go." I am thinking of the families around me. Maybe they are inefficient in the terms of economics but they are rearing Christian families; they are educating children; they are maintaining decent institutions and they are the sheet anchor of settled institutions in this country. I do not want to see them loaded into the tumbrils of economic executions because they do not conform to Common Market standards of efficiency.
Be damned to efficiency. We have a right to live in our country without being automatic machines. If they want this one million per cent efficiency let them put in the automatic machines. They are doing it in Germany; they are doing it in the United States of America; and they are beginning to do it in Great Britain. They can listen to you now, look at you, talk to you, sing to you, but if they are what the faceless bureaucrats want for this country, be damned to them. I believe the purpose of government in this country is to allow our people to live in their own way and I do not want to see small businessmen, who have built up their businesses and reared their families on them, swept out of existence in the name of efficiency.
If that is antediluvian economics, then I am an antediluvian economist and glad to be one. I might be all the better for it because when I look at the countries which have decided efficiency is the sole criterion and look at the avalanche of catastrophe that has come down upon them, I view with satisfaction our system of society and congratulate myself that we have not brought all the efficiency of the world down on top of us. But so surely as you bring it into operation, so surely will you wipe out all those so-called inefficient distributors and so surely will the big boys take over who measure their efficiency by their low margin of profit and they will cut that profit and when they get down to four per cent or 3½ per cent margins, where is their scope to hand 2½ per cent over to the Government?
Nobody is fooled by the daft economics of the Tánaiste who, when he spoke here today, was preaching what he did not believe. I believe he was sent in here to give a token of his loyalty, with notice that if he did not, he would be put on a scrapheap with some other candidates for that proposal. I shall not follow the matchbox operation, it is so hollow, so false, but I cannot refrain from saying that if you reduce the number of matches to half, you can cut your price by half and if you leave no matches in the box at all, you can pay the people to take the boxes away. What a perfect policy for a Government to base their economy on, what pearls of wisdom to throw to us as a test. Heavens preserve us from the damning folly of men who believe the philosophy of a nation should be to build on such basis.
How comfortable it is to operate on the racecourses, to play the three-card trick if it is somebody else's money. It is our people's money: it is our people's livelihood we are dealing with; and when we talk about competition bringing us down to three per cent on turnover, does anybody believe Mr. Garfield-Weston will come in here to trade on a profit margin of one per cent? Does anybody believe any international organisation is buying up property and building pay-as-you-take stores, or whatever you call them, in Dublin and the provinces in order to operate on a profit margin of one per cent on turnover? In the immortal words of Eliza Doolittle: "Not bloody likely."
I sympathise with my excellent, honest friend, Deputy Colley, who has the fatal weakness that he gets up and thinks aloud and who is too honest a man to go on thinking as crooked as he loyally tries to do. He gets up faithful to the idea of following the Party line, but then begins to open his heart to us. May I remind the House that so surely as Garfield-Weston's name is Garfield, every cent of the 2½ per cent will ultimately find its way into the Exchequer, and bear in mind that this irresponsible Government do not vigilantly watch to see where the tax will fall but, like Pontius Pilate, call for a bowl of water to wash their hands and say: "We do not know where it will fall. As the shopkeepers have a defenceless organisation, we can do as we like and this tax will ultimately find its way back to us. That is all we want."
Surely it is an essential element of sound taxation that a tax should be certain and that its incidence should be manifest to all? Has anybody in this House ever heard of a tax proposal that had built into it this puzzle: "We do not know where it is coming from: we do not know who is to pay it; and we do not know what it will be levied on; but we warn everybody that we must get a good return from it or we will see about it." Take my word, it will be the consumers who will pay for it. Deputy Colley asks from what other source the revenue could have come. He said beer, tobacco, all other taxes had reached a point of diminishing return.
Then Deputy Colley paused for he suddenly realised he had let the cat out of the bag. Here was a tax which had no point of diminishing return. If you could persuade the fish to swallow this little harmless 2½ per cent worm, everything was wonderful. Next year, the worm would grow to 3½ per cent, the year after to five per cent, then to 7½ per cent, then to ten per cent, and there is no point of diminishing return until the people know hunger so that it cannot impinge on food any more, until our people know what it is to walk in rags so that it cannot impinge on clothing any more, until our people know again what it is to be cold so that it cannot impinge on fuel any more.
Thank God, we are a long way from that but what a happy, cheerful vista stretches before us—that if we seek accumulation by speculation there is no optimum. "Two-and-half per cent this year is excellent profit-he is not gone bust yet; five per cent next year, and if he is cleaned out the next time round I will be old enough to retire with dignity." It is a pretty picture but I do not think the people will buy it. I have seen two practitioners of it in the world. East of the Iron Curtain, the Cominform taxed food, clothing and boots by simply jotting the price up in the Government stores because they decided it was necessary. They professed to believe, in support of the proletariat revolution, that it was necessary to exploit the masses for the benefit of the State.
On this side of the Iron Curtain, it is the favoured instrument of the faceless bureaucrats whose spiritual home is Brussels. There is not a single person involved in the political administration of the Common Market who has not firmly resolved the time has come to bring the faceless moguls of Brussels to their senses. I do not believe it is the part of any Government to exploit the masses. I believe it is the function of a democratic Government solicitously to protect the masses. But for me, the masses are the ordinary people amongst whom I was born and amongst whom I spent my life as their servant. Everything I have, I made out of the ordinary people, waiting on them across the counter of my shop. I am proud of it. I entered public life to be their servant. My understanding of that duty is to protect their interests, not to exploit them so that the State might grow great and that the gambler's hand would be forever gilded with the necessary coin with which to speculate.
I challenge the Minister for Finance and the Taoiseach to say if there is any country in the world where this tax has been introduced and where it has not grown. If there is, I have not heard of it. New York is in pandemonium at the present moment because, despite the most solemn undertaking by the Governor of the State of New York and the Mayor of New York City that their hand might wither before this tax was ever raised, recently it was raised by 33? per cent. For the people living in New York, with their scale of living, it is a relatively light burden and yet the people there are in pandemonium. However, if you are living in Ireland, it is not a light burden. It is substantial, particularly if you belong to that section of our society whose family responsibilities require you to disburse your total earnings every week.
I want to say—this is a minor consideration and yet it is of significance to a number of citizens in this State —that to charge the turnover tax from 1st November on the credit sales of every shopkeeper in Ireland who collects his debts in November and December is an act of absolute madness and must be done by a Minister who has no conception of what he is doing. There are individuals in this country who will collect £50,000 or £60,000 in November and December in respect of sales made in the previous six months, who will break in on shopkeepers and collect the corporation profits tax on those sales at 2½ per cent without any regard for equality or for their fundamental rights. I assume the Minister, when he comes to realise the significance of that proposal, will alter it if this Bill ever passes this House.
I assume that, with the couple of cripples the Government have managed to muster to their flag, they will get this Bill through tonight but they must realise, if they do, that a proposal of that character must be done away with. I think the retrospective corporation profits tax is an abominable provision, just as I think the proposal, the hangman, imbecile proposal to destroy the confidential relationship between bankers and their customers is idiotic.
Nobody wants to protect the interests of the tax evader but there is no use in tearing down the whole house round about our ears in order to dislodge a mouse. I do not know how many people evade tax and stack it away in a Dublin bank but one thing certain is that everybody who wants to do it hereafter will take damned good care to stack it in another bank than an Irish bank. How will we be better off by that transaction? So long as it was here, even if we did not get it through income tax, we got it in death duties or succession duties. But, if it is in London or in Peru, our chances of getting it will be progressively less. As these deposits flow abroad — not out of the banks but passing the banks: never going into the banks—the credit for expansion in this country will continue to diminish.
In Ireland—in most countries, for that matter—all deposits are not significant but in Ireland deposits count. I heard the Minister for Finance blathering about an increase in the total deposits in the banks. Who the hell is talking about them? What will be dislodged as a result of this folly are the traditional time deposits of our people which constitute a substantial proportion of the credit of our country which nobody knows except the banks because the statistics do not reveal them.
The retrospective corporation profits tax will undoubtedly affect relatively few people in this country. It is abominable that if a man has paid his tax and cleared his account to the State, and if he has done so honestly, the State can come back to him and say: "We did not charge you enough; we want to charge this much more." None of us could be expected to shed floods of tears for the few individuals affected but the principle is wrong. The Government come in here blabbing: "We have to get the money. Where will we get the money?" Why did they not foresee they would want it? A year ago they were prancing about this House saying what a wonderful chap and what a genius Deputy Dr. Ryan, the Minister for Finance, is. Now he is blabbing about being short £4¼ million. For the first time in the history of the State, he will have recourse to retrospective taxation.
What is wrong with this Government is that they are incompetent, unprincipled and ought to go. I leave the verdict on that proposition most cheerfully to the people. I will shock some of my friends, I suppose. The Taoiseach says that he is "raring" for the fray, longing for the excitement, for the chance to put his fortunes to the test.
