What I am trying to say is that the Minister should not attempt to paint a wrong picture because during that month there were many thousands of emigrants at home who had not returned. The summer months never provide a true figure for the position. I am not going to comment on the figure of 14,000 because we could wax eloquent on the emigration position and make comparisons with 1947, 1956, 1960 and so on. It is deplorable that these people should still have to emigrate. The Minister for Finance in a recent speech boasted of the fact that at the end of June or July, only 30,000 were registered as unemployed and that when the inter-Party Government left office, the number was 100,000. He must know that it is entirely dishonest to compare January with the summer months, especially those summer months in which the Employment Period Order operates. If the Taoiseach and his Ministers want to paint a picture, they should not give distorted figures like that.
It has been mentioned that unemployment still stands at 50,000. I do not think that a figure of 50,000 represents a great deal of progress. It seems to me that the First Programme for Economic Expansion, which has been described by the Taoiseach as being successful, cannot be deemed to have been successful when one reminds oneself that after five years of that Programme, we still have a figure of 50,000 unemployed which will, as it does every year, mount up to February and March and possibly to April. The Taoiseach should be a little clearer if he wants to give the picture to the people. I know he cannot stand up and announce that there is a period of boom because the whole House will agree with him that so far as achievements are concerned, we are still very far off the target and that we cannot afford to be too optimistic, but at least we should have the true picture so that the people will know the task that confronts them.
I was amused at one notable omission from the Taoiseach's speech —and I could make the same comment in regard to the speech by the Leader of the Fine Gael Party— because this time last year, and for the past two years, all of our general discussions centred around the Common Market. Where has the Common Market gone? Where is our enthusiasm to join Europe? Where is the talk about our cultural relations with Europe, the military and social obligations, and the industrial advantages to be gained from the Common Market? The Taoiseach will have to describe what exactly the Government's attitude and their feelings are now with regard to the Common Market. I do not know what contact he has with the British Government on their application and what its future is. It seems to me that there has been a lessening of enthusiasm, even within the Conservative Party, for association with the Six Common Market countries, maybe because of their rejection, maybe because they have evolved a different policy of trying to build up trade with other countries, particularly in the Commonwealth.
The Taoiseach should not discount the possibility, or the certainty, of a different Government in Britain within the next six months. It must be obvious to everyone from the speeches of the leaders of the British Labour Party that they are not nearly so enthusiastic about entry into the Common Market, on the terms laid down, as even the Tory Government were. It might also be said that the Common Market, especially on the subject of agriculture, does not seem to have harmonious discussions. Whether or not the British Government are going to be influenced by that, we do not know, but what is perturbing to me is that so far as the protection of Irish industry is concerned, we are proceeding on the assumption that we will be members before 1970.
The Taoiseach assured us last year, maybe not in the month of December, that we would be members of the European Economic Community by January, 1963. It is not his fault that we were not. I suppose it is the fault of President de Gaulle and the French Government, but I should like to pose the question posed to the Minister for Industry and Commerce by the late Deputy Norton some four or five weeks ago: Is it wise for us to strip ourselves of the protection of Irish industry at the rate of ten per cent per year in the beginning and 15 per cent thereafter, as if we were to become members of the Common Market in 1970, while, in that very hard exercise, Irish industry and Irish workers obtain no advantage whatsoever? The House will readily admit, I think, that we had a policy of protection up to about three or four years ago and it seemed as if we were going to continue that policy for a very long time. Then came the Treaty of Rome and the establishment of the Common Market and we had to decide, because of our close association economically with Britain, to make application for membership of the Common Market. Is it too much of a gamble now? Are we gambling unduly on the assumption that we will become members of EEC by 1970?
Everybody has agreed, and the evidence is there, that the reduction by the first ten per cent did not have any appreciable effect on Irish industry and on the employment of workers in industry. The second, third and fourth will have very serious repercussions as far as industry and as far as employment are concerned. The Government, particularly the Minister for Industry and Commerce, will have to examine the position very closely. The Minister for External Affairs and the Taoiseach will have to make a reappraisal of the position to see whether or not it is worth our while to engage in this exercise, on the chance, and I believe it now could be a chance, that Britain and we will become members of the European Economic Community.
This time last year, and for 12 months before that, all of us were concerned about the effect of the dismantling of the tariffs on employment. CIO committees were established. They were charged with finding out the effect on production and on employment of the stripping of these industries of protection. Certain recommendations were made. I should like the Taoiseach, when he replies to the debate, to give us a broad outline as to what these industries are doing to rationalise, to provide for greater co-operation, and generally to safeguard industry and enable it to compete in a better way, taking appropriate measures to ensure there will be the minimum of redundancy.
As I have said, I think we have forgotten all this since General de Gaulle gave his famous refusal to the British application last year. I know the Minister for External Affairs had some talks in Brussels recently, but the communiqué conveyed nothing, of course, to those of us who questioned him here in the House. I should like the Taoiseach to say now if our application and our entry into EEC are still dependent on the admission of Great Britain. If we fail, has the Taoiseach considered some form of association? I ask that knowing full well the disadvantages there are in association as against full membership. A great many people believe we should have some association with Europe.
The publication of the White Paper on incomes in February provided, of course, the first shock. It also provided the material for the first major debate in this House in this year. I do not know why the Taoiseach or the Government decided to publish this particular document. It seemed to the members of the Labour Party and to the members of the Irish Congress of Trade Unions that the Government were once more attempting to interfere in the fixing of wages. These allegations were, of course, denied, but a responsible body like the Irish Congress of Trade Unions, which could not be deemed to have any political motives in their dealings with the Taoiseach, were, I think, in a better position than anybody else to judge whether or not this White Paper was another attempt to interfere with the fixing of wages.
There was also an inference in that particular document, and allegations by Ministers and the Government, outside this House of course, that the eighth round of increases was responsible for this imaginary gap. At that particular time, peculiarly enough, there was no talk at all about a ninth round of wage increases but this reference to wages in the publication of this document got both the Congress and the workers contemplating on and talking about a ninth round of wage increases.
The Taoiseach in recent weeks has, I think, tried to be helpful but his whole record in the past 12 months, as far as wages and salaries are concerned, has been one of blunder. He has blundered badly in all this. I do not think he should have interfered to the extent he did because, whilst people may have certain views about the eighth round of wage increases, and while people may talk about all the strikes that ensued, by and large, the trade unions of this country, particularly the main body, the Irish Congress of Trade Unions, and the employers have ironed out their difficulties and produced what may not have been a mathematical formula but was certainly a broad agreement as to what the increases should be from time to time. The publication of the White Paper and the speeches made in this House caused the trade unions to become antagonised. I shall come back later to this question of wage increases, the effect on the economy, and the justification for a certain type of increase.
The next notable event was the introduction of the turnover tax. I do not want in this debate to reiterate all the arguments we in the Labour Party have against the turnover tax but we retain the original view we expressed on the day the Budget proposals were announced and the views we expressed in the subsequent debate on the Finance Bill. Mark you, not alone were the members of the Labour Party astonished by the introduction of this tax but members of the Government Party were astounded at the idea of a tax on foodstuffs, on the necessaries of life, and particularly on medicines. On that occasion, we pointed out the effect on the lower paid workers, on those on fixed incomes, on those in receipt of pensions. Despite the increases granted in the Budget to the social welfare groups, the majority of them are worse off now than they were prior to the Budget proposals.
All the arguments that were made from the Government benches, and particularly by the Minister for Industry and Commerce, were based on the assumption that the cost of living would increase by 2½ per cent. Indeed, the Minister for Industry and Commerce on one occasion described what that would be in terms of spending by a man with a wife and four children, and balanced against that the children's allowances granted from 1st November; he broke just lineball. That was on the assumption, of course, that the increase in the cost of living would be 2½ per cent. Because it is more than 2½ per cent—I should not like to put a figure on it, but it is certainly more than four per cent— these people have lost out. It may only be a matter of pennies in the case of old age pensioners. But pennies are very important. Sixpence or a shilling is very important to somebody in receipt of 35/- a week, or somebody on unemployment assistance who has even less.
I gather from the Taoiseach, although it has not been said directly by Government spokesmen, that this is to be a permanent tax. I also gather from the Taoiseach's remarks, although it has not been said explicitly, that if the Government feel next year that more money is needed, the turnover tax will be jacked up. The Taoiseach will have to think again, especially in respect of foodstuffs. Is it not dastardly that to pay for better health services, better education and future economic progress, it is necessary to tax bread?
While the Labour Party strenuously objected to taxing foodstuffs, medicines and certain types of clothing, we admitted during these debates that we would not object to a tax on articles not strictly necessary to individuals or families. In particular, we would not object to a tax on luxury items. The Taoiseach would be right in telling me that relatively little can be got from these items. But, nevertheless, some money can be got from them. My criticism of the Government is that, when you suggest a tax that may bring in only a small amount of money, you are told it would not be worth while. Yet all these things add up. Every effort should be made to ensure that foodstuffs are not taxed.
The only defence the Taoiseach has for the turnover tax is the cry: "What would you do? How would you raise the money?" That is pretty good when you are standing on the ditch asking a theoretical question. On many occasions, when the present Taoiseach was in opposition, he said that the business of the Opposition was to criticise, and that it was the Government's responsibility to provide plans for the raising of money. He is a little too nave. We are only four months away from the next Budget, and according to the speeches of Ministers, we are going to engage in more ventures which will cost money. Is the Taoiseach prepared now, four months before the Budget, to tell the people what new taxes and new increases there will be? It is not unreasonable to ask him that question—to say now, even before the by-elections, what new taxes he will introduce to pay for the projects spoken of. It is nave for him to suggest that we should provide in specific terms proposals for him for the raising of money. Mr. Harold Wilson, who expects to be the next Prime Minister in Britain, is not telling the British people how he is going to tax them. I do not remember the former Taoiseach, now the President, telling the people prior to the election of 1957 that he was going to withdraw the food subsidies. In October, 1961, the present Taoiseach did not say he was contemplating a purchase tax, a turnover tax or a sales tax.
One of the differences between the Labour Party, the Fianna Fáil Party and, I suppose, the Fine Gael Party is that we believe there has been too much emphasis on indirect taxation here in recent years. I quoted to the Taoiseach some time ago the proportion of direct as against indirect taxation in this country, compared with other countries. I accept to some extent that we would never be able to secure by way of direct taxation the proportion secured in countries such as Germany, France and Great Britain. But there is money to be got there.
I have no hesitation in describing the turnover tax as a lazy tax. It was too simple. If it is such a good tax and such an equitable tax, why did the Taoiseach not think of it before? I think the Government got a fit of laziness before the last Budget and did not explore all the possibilities of raising extra money. They did what a child would do if asked to get money—they taxed everything. This is not good enough. Much more is demanded of the Government and the Minister for Finance.
In his Budget the Minister for Finance said and many people believed him, that the traditional sources of revenue had been exhausted, that if he put any more on cigarettes, beer and tobacco, there would be a diminishing return. But what has happened now? Cigarettes have gone up by 2d.; petrol by 1½d.; the bottle of stout by 1d.; the pint by 1d.; whiskey, I understand, by 2d. per glass. I have no figures to show whether the consumption has been less since 1st November. But I would bet that for the next 12 months the consumption of these commodities will not go down, and the possibility is that it may go up. On that the Government have thrown away £6½ million. They will get about 2½ per cent of that on the turnover tax. The public are paying the extra 2d., but who is getting it? The Government are getting only 2½ per cent on the turnover.
The Government also threw away money in the reduction of surtax and the various adjustments which provide that now fewer people are paying surtax than there were three years ago. There used to be about 10,000, but now it has gone down to a few thousand. It may be small money but over the past few years millions of pounds have been collected in that way. Yet the Fianna Fáil Government have said: "We do not want it; we will throw it away." They abolished the tax on dances—a booming business now. These are all sources of revenue that certainly should have been considered carefully before it was decided to tax tea, bread, butter, sugar, meat and so on. As I said, the difference between the Labour Party and the other Parties is that we believe there has been too much emphasis on indirect taxation, which, as shown by the turnover tax, falls more heavily on those least able to bear it.
We had conflicting speeches from Ministers on the turnover tax. I do not blame them, because they did not know what the effect of the tax would be. Some of them said prices would go down; others said they would reach their own level; and still others said the increase would be only 2½ per cent. As time went on, even the members of the Government and the members of the Fianna Fáil Party became rather afraid of the effect of the tax on prices. I do not know if it was in anticipation of the Cork by-election or not, but in the newspapers it was said the Taoiseach had given the green light. Nobody wanted the green light at all. The trade unions were not waiting for any green light from the Taoiseach or any member of the Government. Ever since the proposal was announced, the trade unions had been preparing their demands. It was obvious that prices would rise and that the cost of living index figure would go up to such an extent as to warrant their preparing and serving demands for increasing wages and salaries.
I took exception to the term the Taoiseach used when he spoke about the past negotiations between the trade unions and the employers. He described these negotiations as horse-trading and he also pretended that during all these negotiations, especially on the eighth round, we had very many strikes all over the country. That is incorrect and if the Taoiseach were to seek the information from the various trade unions or through the Irish Congress of Trade Unions, he would see the incidence of strikes during that period was very low indeed.
