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Dáil Éireann debate -
Wednesday, 11 Mar 1964

Vol. 208 No. 5

Central Fund Bill, 1964—Second and Subsequent Stages.

I move that the Bill be now read a Second Time.

The purpose of this Bill is to authorise the issue from the Central Fund of the total amount of the Supplementary and Additional Estimates for the current year together with the amount of the Vote on Account for the coming financial year. It also authorises the Minister for Finance to borrow up to the limit of these amounts and to issue such securities as he thinks fit for the purpose of such borrowing.

The effect of the Bill is thus to make available the balance of the funds required for the supply expenditure of the current financial year and the amount estimated to be necessary to carry on the supply services next year in the period up to the passing of next year's Appropriation Act.

It was indicated in the Taoiseach's statement of 23rd October last regarding the agreed arrangements for dealing with parliamentary financial business that the procedure on this Bill would follow the lines of previous years.

The bill for which the Minister asks is, as all of us know without making any additional reference to it, a record one. However, it is important in considering the size of the bill that we should compare like with like. The habit that has grown up over the years—let me say at once to the Minister that it is a habit in which I concurred—of comparing in the Book of Estimates the figure for the forthcoming year with the figure for the previous year, as altered by Supplementary Estimates, is a bad one. There will be Supplementary Estimates in relation to this Book of Estimates also and to get a proper comparison of like with like, the comparison should be with the Book of Estimates issued last year.

Last year the Minister required £26,462,265 for capital services. This year he required some £3,000,000 more : £29,349,890. So far as capital services are concerned, we are all clear, I think, that the element of growth that is so necessary requires that we would have as high a programme of productive capital expenditure as the community can sustain. No one will cavil at the amount of the capital programme. We may differ about the proportion of that programme that is adequately productive; we may feel the proportion of that programme directed to social investment is not adequate; we may say certain of the items that are in the capital programme produced by the Government are not suitable for inclusion; but none of us will cavil at the amount of the capital programme, properly productive.

On the capital side, therefore, it is more a matter for consideration at Budget time when we will have before us the White Paper in relation to the entire field of capital development in 1964-65. I might add that I was at a meeting in the House earlier and I do not know if the Minister announced at Question Time the probable date of the Budget.

14th April.

I was going to ask would the Minister announce it now. That means that in a very short time we will get the White Papers dealing with projected capital expenditure during the coming year. It is better to leave over any discussion on capital services until we see them in that picture at that time. I must say I still think it is a pity that in the new arrangements we made for the financial business this year, we did not include a separate Capital Budget so that we could discuss separately our capital proposals for the forthcoming year.

The Minister and the House are aware that it has always been my view—and it is even more my view now—that the amount of capital expenditure tends to rise, as it is rising to-day. The objection to having our capital expenditure produced at the same time as current expenditure is that, naturally enough, the projected capital expenditure tends to be clouded and overshadowed by the problems of personal taxation which all of us have to consider at that time. The Minister was, perhaps, circumscribed when he came into office in that he did not feel able to adopt the suggestion I had left behind, and made public, just before the end of 1956. A lot of water has gone under the bridge since then, but I would earnestly ask him to reconsider that proposal and see if it could be brought into operation, so that we could get a more objective and satisfactory scrutiny of our public capital expenditure.

Current expenditure in this Book of Estimates is now to run at £16 million more than it was to run in last year's Book of Estimates. Comparing like with like, we are faced with an increase of £16 million on the Book of Estimates alone. Of course that is not the only question. It was made perfectly clear that there is nothing for CIE in the Book of Estimates. We all know that a substantial sum is bound to be included for CIE.

I should like to ask the Minister if I am correct in thinking that the 12 per cent wage round is not included in the Book as printed and, in consequence, some £8 million more has to be included on that account. I think the Minister indicated in introducing the Vote on Account that it was not included at that time. I take it I am right—and the Minister will correct me if I am wrong—in saying that it has not been included since the green sheet of the Vote on Account.

The total of the Estimates is, of course, further altered by the expenditure of £1,280,000 for the new method of accounting in the Post Office. The Minister is entitled to make a deduction of that amount. I saw the Minister being referred to one of the introductory pages of the Book of Estimates in relation to the question of remuneration. I do not know whether it could happen that any comment in the introductory pages would be on page 6 of the volume because there is no page 6 in the volume that came into me. Mine goes from page 5 to page 7.

Have you page 11?

Yes. I do not know whether I have missed anything else because in the binding of mine there is no page 6. Therefore, if there is anything on page 6, I shall willingly accept correction in respect of it.

There is a page 6 but there is nothing on it.

I have not got a page 6. As I understood the Minister on the Vote on Account, he said that the remuneration charge all over would mean about £8 million. If I am right in that, it means that these current Estimates show an increase approximately, for budgetary purposes, of £23 million —£16 million on the face of the current Estimates themselves, £8 million for additional remuneration, less £1¼ million for the postal charges which are included and which I understand will come in under non-tax revenue. That is a substantial sum and one which arises to a very large extent because of the policy the Government themselves have introduced.

Twelve months ago or thereabouts, the Taoiseach and the Government endeavoured—wrongly in my view—to take one sector of the community and to impose a wages standstill on that sector. They were shown that they were wrong and ultimately they abandoned that erroneous policy. Notwithstanding that, prices remained virtually steady up to the time of the Budget and indeed after the Budget.

In the Budget debate last summer, and subsequently, we made it perfectly clear to the Government that we felt the type of Budget the Minister had introduced was bound to start an inflationary spiral that would mean that he would be trying to chase it himself in relation to Governmental expenditure and, in addition, there was the gravest danger that such an inflationary spiral might harm the employment of many of our people engaged in the export business.

We were told at that time by the Taoiseach, by the Minister and by the Government as a whole, that the fears we expressed were entirely wrong. We were told that there was no danger whatever. We were told that productivity had so increased that it could take account not merely of the turnover tax —which was the commencement, in my view, of this extraordinary spiral—but could also take account of a substantial increase in wages. Indeed, the Taoiseach staked his reputation on the fact that the increases that had come about by Government action and which he urged employers to grant would not involve any increase in the cost of living and would not, therefore, harm anything that might ultimately affect our possibilities and our opportunities to compete in the export market.

I must confess frankly that the Taoiseach was most successful in choosing his timing and in getting across his propaganda in that respect but the chickens are now coming home to roost. The Minister has now to face a bill of some £23 million odd. Part of the result of Government policy is the fact that not a single day passes that the newspapers or the radio does not have to announce a tale of soaring prices, soaring all because of a policy initiated by the Government some ten or 11 months ago.

I warned this House a week before the recent by-elections that bread would increase in price. The Tánaiste said it was a lying jade. When I told the House that there would be an increase in the price of bread, it was a nice polite way of saying I was lying. In fact, I was right. Within three days of polling day, the price of bread increased. That was only the first increase in the price of bread. There will be a further increase when the increased price of materials that go into the bread come to be considered in relation to the finished article.

It does not matter what item of daily use we consider—bread, tea, sugar, travel, any goods that one buys in a grocery—every single one of them is going up in price day by day. The people are now having to pay the piper for this policy foolishly initiated by the Minister for Finance and the Government last year. Politically, they may have succeeded for a while. Politically, they may have been successful in getting people to judge that the 12 per cent increase had been got by them without an increase in the cost of living but the increases in the cost of living are coming now. In addition to the people's having to bear the increased costs, the Minister has to find the wherewithal in relation to this Book of Estimates.

Every local authority is facing, in relation to its rates, an overwhelming bill that will cripple the average ratepayer. At the last moment, we find the Taoiseach making a reference to some new method of financing. The Minister for Finance did that, as well as I remember, on the eve of another similar situation but nothing ever happened to it afterwards. The county manager in Kildare has asked for an increased rate of, I think, 6/7d. in the £ and many other counties have found the same situation.

If these increases are warranted, it seems to me quite clear that there will have to be heavy increases in Vote 21, Rates on Government Property, and in respect of the other charges that fall to be met, such as the relief of agricultural rates, which is a bigger one, and the health services.

I have mentioned rates on Government property. I cannot understand why, in relation to that particular Estimate, as rates are going up savagely all round, the Minister believes there will be a decrease in the amount by which he is going to reimburse local authorities for that, even with the £66,000 included for the Department of Posts and Telegraphs. It does not seem to me that local authorities are being treated in the right way, although from an accounting point of view he may be able to show that what goes in in one way comes out in another.

We have not yet got the mid-February figure for the cost of living and therefore we have not got the figure on which we are able to base the extent to which the value of our money goes down day by day. What was 20/- before the war became 11/9 when the war was over, in 1947, and in mid-February of 1963, that 11/9 had gone down to 6/9d. I venture to say that when we get the full impact of the increases with which we are faced at the moment, we will find that what was worth 6/9d. will probably have gone down to the region of 5/6d. or 5/9d. and it will have gone down as a result of a policy initiated by the Government. I am not so foolish as to suggest that the Minister and his colleagues deliberately drove up the cost of living. I think they did it by deliberate policy in relation to initiating an inflationary spiral. I believe they were foolish people that they did not realise what was going to happen and I charge them in that respect with not being sufficiently foreseeing, as a Government should be, to realise that the effects of their policy were bound to provide that these prices would continue to soar day after day and week after week.

We only have the beginning of the price spiral that is going to result from governmental action. We have got what I might perhaps describe as the direct increase. The indirect increase has yet to come. The indirect increase arises from the increase in the price of raw materials which are utilised in the finished product. I am extremely apprehensive that industry will not be able to swallow that ultimate increase and meet its competitors in export markets. If it is not able to do so, then the result is bound to be a serious deterioration on the balance of payments front on the one hand, and on the other, considerable unemployment in those industries which devote, and properly devote, so much of their energies and output to exports as a whole. Apart from that, those whose employment is secure are going to find it more difficult than they expected a fortnight ago to meet the increases in costs. A fortnight ago, they were in a beautiful position. They had to a large extent within their grasp a wage increase and they had been deluded by the Government into the belief that that wage increase would come without any increase in the cost of living.

As I say, I commend the Taoiseach for his political timing on this particular occasion but it never pays in public life to be cheap or dishonest; it always comes back in the long run and in the long run, the people will remember that they were "codded" on this occasion into the belief that they were going to get a large benefit with this hand and that nothing would be taken back with the other. This Bill is a public admission by the Minister that in relation to governmental services alone, the bill he has to face for starting this spiral is £23 million. The people, in their bread and sugar, their tea and their bus fares, their tinned vegetables and in all the ordinary things that housewives buy day in day out, are finding it, and when that all comes to be settled down, it remains to be seen whether or not there will be any real benefit to anybody. Unfortunately there will be, I believe, some exports with which we will not be able to compete in the future as effectively as in the past and if that is so, then there will be some people who will not be able to hold the employment they have at the moment.

I suppose in view of events during the past six or 12 months, it was inevitable that the cost of Government would increase. As far as this Book of Estimates is concerned and as far as individual Estimates have been concerned, I must confess that I was not entirely happy that this House has the best opportunity of deciding whether or not the expenditure in certain respects is justified. On a number of occasions, I have advocated that there should be greater opportunities for a more detailed examination of these Estimates by Committees of the House. I want to confess for myself that as far as certain of these figures are concerned, I take the Minister and the Government, and the civil servants who prepare the Estimates, more or less on trust. If the Minister for Finance or any other Minister tells me that he needs £X millions or £X thousands for this or that project and if I believe it is a desirable project and have no severe criticism of it, I say: "All right; that is the money you want and we must give it." I believe that the Public Accounts Committee serves a very useful function, certainly for those who are members of the Committee, but Committees of this House should be established which would act as smaller types of Public Accounts Committees for the purpose of examining these Estimates in detail.

I have been in this House for nearly 18 years and discussion on the Estimates, in the main, entails a discussion on administration. I very seldom hear from the supporters of the Government in power or from those who happen to be in Opposition questions as to whether or not a particular amount is adequate or inadequate. We have had the usual criticism that there was not enough for social welfare, not enough for housing, and such services. The questions that really need to be asked can best be asked, I think, in Committees: they are questions such as: are we spending too much under this particular head or that particular subhead?

We are not in a position to know at the moment because any Minister, with the best will in the world, cannot in public session, in winding up on his Estimate, give us the real reasons for certain types of expenditure under various heads. If we are, and again I include the Civil Service in this, to retain public confidence, we will have to be able to give the public an assurance that the moneys the Minister for Finance asks for are necessary. More important still, we will have to be in a position to convey to the public that the money we give to the Minister is spent in the right way.

I have an idea—I must confess I have no real evidence behind it—that within the Book of Estimates there could be some pruning, pruning that need not necessarily entail hardship on any people, and certainly not hardship in the matter of employment. But pruning needs to be done. The Minister for Finance, in respect of the whole Book, and the various Ministers individually, in respect of their particular Departments, are equipped with a certain amount of knowledge and probably know the justification for expenditure under the various heads. The civil servants certainly know. I think it is important that the public should know.

My contention is that the type of discussion necessary cannot be engaged in by way of public debate. Let me advocate again to the Minister and to the Government consideration at least—I do not know whether they have ever given it serious consideration—of the establishment of Committees representative of all Parties which would behave, in respect of each Estimate, as the Public Accounts Committee do in a general way on all the estimates. I suppose one should confess as well that those of us who are not on the Public Accounts Committee do not read the reports in absolute detail, but, from the very quick glance we give, we realise some very good and searching questions are asked. On the other hand, good answers are given by those responsible for answering from the various Departments. I honestly believe the suggestion I make to-night— it is a suggestion I have made on other occasions — ought to be given serious consideration by the Minister for Finance and the Government, and those who advise them.

This being a general debate, I want to mention just two or three things. The most important one—the most important issue in the country at the moment and the one that is of gravest concern to the people—is the question of prices. As Deputy Sweetman said, the February index figure is not yet available. Let nobody think it will be any consolation to me, or to any members of the Labour Party, if that figure shows a very big increase. I suspect that it will show a fairly substantial increase.

And the mid-May figure will be much worse.

Those of us who are responsible for keeping homes and who have experience of meeting the public know the November figure showed an increase of something in the region of a little over 2½ per cent in the cost of living. As far as we can see—again, we have no evidence until we get the figure—all commodities seem to have increased in price. What really concerns the Labour Party is the fact that there does not seem to be even a half-hearted attempt by the Ministers responsible to control prices, to exercise some form of control. Exhortations are useless. The exhortation by the Minister for Industry and Commerce recently—I think it was yesterday—is absolutely useless. The people to whom he makes these exhortations are only laughing at him.

The Taoiseach also talked on 9th March, the day before yesterday, about price increases. He said price increases are likely but increases in all commodities are not inevitable, and he then exhorted people to do this, that, and the other. He lectures the trade union movement as to what they should do to keep down prices. He advises manufacturers as to what they should do: they should be able in many cases to absorb certain increases.

The Minister for Industry and Commerce has been questioned several times in this House since the introduction of the turnover tax. His efforts have been extremely weak in the matter of price control. His stock answer recently has been that the Fair Trade Commission have been looking after prices, but he goes on to qualify that by saying that the Fair Trade Commission are concerned only with price increases arising out of restrictive trade practices. Price increases arising out of restrictive trade practices can be pretty extensive, but the type of price increases we are talking about are increases that could not be pinned down by any court of law and labelled as restrictive trade practices.

The plain fact is that when one has regard to the turnover tax, when one has regard to the increase in wages given to many thousands of workers, one cannot see where certain price increases are justified, but the Minister glibly says that the Fair Trade Commission are watching this and that his Department are keeping an eye on the situation, that certain increases have been brought to their notice, that they are satisfied that they are not abnormal, and they are satisfied that there is justification for them. I do not know what extra staff the Minister has got into the Department of Industry and Commerce, but this is an abnormal period as far as prices are concerned. In my time in political life, I do not believe there was ever such a crisis in relation to prices as there is at the present time.

I agree with the Minister for Industry and Commerce when he reminds us of the purpose for which the Fair Trade Commission was set up and stresses that the Commission is not sufficient to meet the present situation. I think all of us will admit, although we fought strenuously against it, that, because the turnover tax was introduced, price increases to a degree were justified, because nobody expects those who are selling goods to reduce their standard of living by reducing prices to their own detriment. All of us admit also that price increases are justified by reason of the fact that an increase in wages was negotiated. What annoys me, what annoyed me yesterday particularly, was a statement by the Minister for Transport and Power, on behalf of the Minister for Industry and Commerce; the Minister for Industry and Commerce was asked if he would give an account of fluctuations in prices from 1st November to date in the specific commodities generally considered in compiling the Consumer Price Index and whether any other outstanding price fluctuations in other commodities have come to his notice. In the second half of his reply, the Minister said:

I do not quite know what the Deputy means by outstanding price fluctuations.

I do not know where the Minister is living if he does not know of any outstanding price fluctuations. He goes on to say:

I am aware of increases, consequential on increases in production costs, in the prices of bread, turf briquettes, milk and cement and it was announced yesterday that the price of sugar has been increased by the Sugar Company.

There is no mention, so far, of the turnover tax. We all know that the increase in the price of practically every single commodity was set off by the introduction of the turnover tax. As a matter of fact, the ninth round of wage increases was sparked off by the introduction of the turnover tax. The Government appear to be evading their responsibility in the matter of increases in prices and it is a bit "off" for the Minister for Industry and Commerce to blame the ninth round for the increases that have occurred over the past five or six months. The basis of the agreement negotiated by the Irish Congress of Trade Unions was compensation for increased production since the eighth round of wage increases was negotiated plus compensation for an increase in the cost of living that occurred from the time of the eighth round of wage increases.

We have pressed the Minister for Industry and Commerce to employ the machinery which he himself embodied in the Act of Parliament for which he is responsible to this House, the Prices Act of 1958. Did he ever believe he would have to use that machinery? Surely when he introduced that Act, he foresaw some situation wherein the Prices Advisory Body would be called upon to function. The time has long gone when the machinery which he created in that Act should have been used. He said himself, and we all agree, that under its terms, the Fair Trade Commission is inadequate in this situation and there is no other legal machinery by which prices can be effectively controlled except the body for which the Minister for Industry and Commerce was responsible, the Prices Advisory Body. He said on one occasion he hoped he would be able to pigeonhole this Prices Act and only take it down when it was necessary. He must agree that in present circumstances it is necessary.

The Minister for Transport and Power, replying today for the Minister for Industry and Commerce, told Deputy McQuillan that there had been no notification by wholesalers to retailers of increases. I suggest that if the Minister for Industry and Commerce does not know, he is not doing his job properly. It is well known in every part of Ireland that every retailer has been sent a circular notifying him of increases in a great variety of commodities. In the short time allowed to him in a supplementary question today, Deputy McQuillan tried to list some of the commodities. I have here three lists of commodities that have been notified to retailers as carrying increased prices. Maybe they are justified. The Minister for Industry and Commerce does not care whether they are or not because if he did, he would take pains to have them investigated. Here is a great variety of goods, mainly tinned foodstuffs but including other things, in respect of which increases have been notified. I do not know whether or not there is justification for these increases. To the public, the turnover tax will be blamed or the wage increases will be blamed, but the public are not in a position to know what element of turnover tax or what element of wage increases is contained in these increases in prices. They are entitled to know.

In the ninth round and in every round of wage increases and on every occasion when they sought an increase in their wages, the workers had to prove their case. They have to prove a case for increases in income in order to sustain themselves or in order to maintain a certain standard of living. Over the past 14 or 15 years, they have had to go to the Labour Court or to go to open court to prove the necessity for an increase in their wages. They subjected their case to the criticisms and refutations of the other side, the employers' associations. They also subjected their case, in the main, to the decision given by the Labour Court and in the vast majority of cases, they accepted the award of the Labour Court, which is leaving it to a public tribunal, to three judges, to decide what wages should be fixed for them.

It is probably a cumbersome and intricate operation to examine prices of commodities because they run into tens of thousands or hundreds of thousands but I believe the establishment of a prices advisory tribunal in respect of certain essential commodities is imperative. If I were a supporter of the Government, I would advocate that they do that in order to allay public disquiet because it seems to the public that nobody cares whether or not these increases are justified.

The trade union movement have made an agreement with the employers which is to obtain for a period of a little over two years. Everybody applauds the general idea of there being a national wage agreement. That is not to say that we agree with the general wage structure, especially in respect of lowly-paid workers. However, most people would go along with the idea of a national agreement on wage increases in order to try to ensure stability of prices and manufacturing costs, so that there will be an incentive for increased production. The workers appear to be determined to do their job and the evidence as far as production is concerned is that they have pulled their weight.

It is not unreasonable for the trade union movement to expect the Government and, in particular, the Minister for Industry and Commerce, to do their job in trying to provide stability of prices. I do not want to provoke or anticipate action; neither have I discussed this matter with the officials of any trade union, but it seems to me that this 12 per cent increase that has been negotiated could be swallowed up very quickly and unless there is some quietening down of prices, unless there is evidence of more serious and stronger action by the Government.

The Government have a very big responsibility in this, in that they introduced the turnover tax. I do not intend to debate now the merits or demerits of the turnover tax but that increase was responsible for an increase in the cost of living much more than the 2½ per cent. There were some Ministers in the Government who in April or May last thought foolishly that there would be no increase at all. But even before the ninth round wage increase was negotiated, prices of many commodities went up by much more than 2½ per cent.

The Government were warned at the time what the situation would be. They were warned and the country knew that there would be at that stage a ninth round of wage increases and some manufacturers and some retailers put up their prices in anticipation of the ninth round and now some of them are coming along again trying to compensate themselves for the second time for an increase in wages. That is a situation that needs to be looked at because everybody wants to see stability in prices, and, I am sure, the Government as much as anybody else.

Talking of this 12 per cent wage increase, the Government seem to have successfully used it in two different ways to their own advantage. The national agreement negotiated by the trade union movement whereby a general increase of 12 per cent was granted was represented, particularly in the by-elections in Cork and Kildare, as being something for which the Government were responsible. I must confess that I and my colleagues in my Party tried to disabuse the minds of the people of that idea. The allegation by some of the brasher members of the Fianna Fáil Party was that the Government had made it possible for workers to get a 12 per cent increase. The inference by more responsible members of the Party was to the same effect.

That, I suggest, did get them a certain amount of extra support in these two constituencies. Of course, if the facts were well known to all the people, they were to the effect that if the Government had their way or if the Taoiseach had his way, the national wage agreement would have provided for an eight per cent increase because he is on record in this House as having said that if any more than seven or eight per cent were given by way of wage or salary increase, the economy could not stand it. Despite what he said on that occasion, the trade union movement, with the employers, came to an agreement for 12 per cent. He trimmed his sails then and, on another occasion, before or after the election—it does not make any difference—he said: "Well, a bit of a bonus for the workers may be a good thing as well".

There we have the two voices. On 12th December last year, it would have been fatal to give any more than eight per cent but now that the 12 per cent was negotiated independently of the Taoiseach, he says: "Well, it is not a bad thing that they got the other four per cent". Who can believe, then, the viewpoint of the economists, which was, that more than eight per cent would ruin the economy, now that we have a situation where another four per cent has been given, and we have not heard a squeak from the economists or from the Taoiseach about the effect on the economy?

Before the election, they tried to claim credit for the 12 per cent. After the election, they are blaming the 12 per cent for the increase in prices. But, as I have said, the 12 per cent was to compensate the workers for the increase in production since the eighth round of wage increases and to compensate them for the increase in the cost of living in that period also.

I want to mention one other thing, that is, the question of employment. Granted, we seem to have more factories, more industrial activity, more persons employed in industry than we had last year, the year before or the year before that, but I do not think anybody should try to give the impression that our employment figures are better than they are. I do not think anybody should try to give the impression that nearly all our needs are satisfied as far as employment is concerned. There is the fact that we have 60,000 unemployed. We had the same figure two years ago. We had, I think, 67,000 unemployed this time last year but I accept that there were special circumstances, due to the bad weather at that particular time.

As far as unemployment is concerned, we do not seem to have made a great impression on the figures. There has not been any spectacular reduction and, as far as employment is concerned, I do not think that we can be too complacent. As far as I can gather from the statistics available to me, some of which were quoted in one of the daily papers today—I think it was the Irish Times—and these were from the official census figures—the total number of persons employed in this country in 1951 was 1,217,108. The total number employed in 1961 was 1,052,539. At the end of that period of ten years, there were 164,569 fewer employed.

That is an expanding economy.

Employed in agriculture in 1951 there were 493,292. Employed in agriculture in 1961, there were 376,272, a decrease of 117,020. Again, according to the census of population returns, employed in industry in 1951 were 723,816; employed in industry in 1961, 676,267, a decrease of 47,549. That, let me say, was up to the year 1961.

I cannot be absolutely positive about the figures in 1962 and 1963 but the total number employed in agriculture in 1963, according to figures which were elicited by way of Parliamentary Questions by Deputy Tully, the total number employed in agriculture in June, 1963, was 354,900. So, therefore, as between June, 1961, and June, 1963, there were 21,372 fewer persons employed in agriculture.

The picture as far as industry is concerned is on the positive side. The average number of persons engaged in manufacturing industry in 1961 was 167,900. The average in 1963 had increased to 176,400. So, therefore, there was a decrease in the two years from June, 1961, to June, 1963, of 21,372 in agriculture and, as far as the increase in transportable goods industries was concerned, the average from 1961 to 1963 had increased by 8,500. In any case, the net result is that as between June, 1961, and June, 1963, there were fewer persons in employment. That is a situation we cannot regard as being entirely good.

Let us applaud efforts that are made for the establishment of industry and let us be encouraged by the results we have got as far as industry is concerned in recent years but let us also decide that a greater effort is necessary. It is not for me to advocate the policy or the attitude of the Labour Party tonight but let me conclude by saying that as generous as State aid may appear to be for the establishment of industry, more is needed and more Government intervention is needed, in our opinion for the establishment of these industries.

The alarming thing about the Bill before us, presented to us with this Book of Estimates is that it is only an indicator of the direction in which we are moving. As an indicator, I think it is a very frightening document, so much so that I think the Government must now regret they did not heed the warnings given them on the proposals they made here last year, warnings that these proposals contained the seed of great inflation. We are now in it. It is reflected in this Bill and reflected in ever-widening circles, like flood water lapping into the homes of every person in the country.

A detailed examination of the Estimates is only a waste of time, in view of the awful pattern that is being imposed in the whole of the Minister's demands. Inflation in itself, the devaluing of money, is a modern, contemporary problem and it does not require any assistance because it is able to generate its own movement, but if it does get any assistance of the kind the Government proposals last year gave it, it becomes more than a trickle: it becomes a flood and we see the evidence of that flood now around us. I have no doubt that the year's end will show that every pound note we now possess will be worth only 18/-. I have no doubt this trend will continue because what we have done is to let loose an avalanche of inflation that is resulting in none of us being better off and some of us worse off, and our exports are hit.

What we did, in effect, in order to win two by-elections—to put it crudely —was to raise an overdraft on the future. That has a very short-lived success. Now the bills are coming in. I remember the difficulties of fighting these by-elections, of trying to tell the people that a 12 per cent wage increase coming to them was not a real benefit and I remember thinking how difficult it would be to get them to believe that it was against their best interests that these developments should have taken place. I remember feeling that the task was almost impossible, and so it proved to be. The Government had a victory. I think it is a real Pyrrhic victory and that the Government themselves now feel that the end did not justify the means they used.

All the people will pay more, more than the more they get. The State will pay more for everything it does. This bill before us shows that local government will cost a great deal more. Inflation is a very dangerous tiger to let loose and we let it loose last year. Money will find its own level but many will submerge in the process. I believe the Government are now sorry for any act of theirs to initiate this avalanche but it is now too late. We have now seen in ten years in this House the amount of the Book of Estimates become doubled and as Deputy Corish has said, in that same ten years we find—and I quote today's Irish Times extract from Central Statistics Office report—that the number in gainful employment in this country in those ten years has dropped by 164,000 people.

We have doubled the cost of running the country; we have reduced the value of money probably in the same proportion, and the number employed here is 164,000 fewer. We should now become thoughtful. If we could get a modern Hogarth he should be employed to paint a modern Irish "Rake's Progress." As we have inviting vacancies on the walls of this House I think it should be hung on these walls and Budget Day would be a very fitting day for the unveiling ceremony.

Deputy Corish has mentioned the ineffectiveness of the Government's efforts to control prices. You cannot control prices in the situation that exists here now, any more than you can control flood water. We can expect prices to go up and we can expect money values to find their own level. It is about time for us all to discover that there are no fairies at the bottom of the garden and that if you fiddle about with the people's money and reduce its value, this is the result. The electors of Kildare and Cork have, I think, gathered what will prove to be Dead Sea fruit.

The Minister introduced what is the forerunner of the most important discussion on the financial provisions of the State in introducing this Bill and so far the situation is that he has had no supporting speaker from his Party. One would think that, fresh from the hustings, a Party buoyed up by the response they secured by the methods we intend to disclose, would be on its toes to come in behind the Minister and explain to the people the figures of both national and local expenditure which the country is asked to bear at this time. Just now we have a grand national race in progress, with every section of the community accepting the green light that was shown by the Taoiseach when they were invited to "have a go" at the national "kitty" and try to get from it all that it was indicated was there for them. But even before we have satisfied the people with the right to draw from that "kitty", the various sections of the community whose claims are incontestable, unfortunately we have before us the figures already involved in paying the piper for the tune that is being played to date.

We had a visitation in Cork a few years ago by the Parliamentary Secretary to the Minister for Finance, the self-announced successor to the Ministry who, we assume, will shortly replace the present Minister and bring a new and glorious light into the financial administration of our country. He deputised for the Minister for Local Government at the opening of Youghal Bridge. A very representative gathering was present from both counties Cork and Waterford, including public representatives and a good cross-section of the community. That day he announced that the Fianna Fáil Government had given long and serious consideration to the situation of the different classes in the community and were seriously disturbed at the fact that a gap existed between the incomes enjoyed by those working in industry and those working on the land.

What was to be inferred from this statement? There could be but one inference, that at last the Government had found a solution to that and within a short time, there would be a bright and happy announcement relating to an improvement in the lot of the agricultural community. But the party was over; the dining and the wining ended that day and we returned to the House. What were we presented with? Not a proposal to improve the lot of the agricultural community, but by a proposal from the present Taoiseach to observe a pay pause relative to public servants and relative to all those employed in all other sectors. Can the vacillating man now responsible as head of the Government explain the arguments he advanced when he advised the country to institute a pay pause in relation to incomes?

Can the Taoiseach explain the announcement which Deputy Corish has adverted to regarding the limitation of eight per cent which the economy could afford to bear as an increase in wages both in the public service and the private sector without damage to the economy? He was the man responsible, his Government and his Party were the people responsible for giving the green light to every organised union, to everybody in a position to demand and secure a 12 per cent increase in wages and salaries. How were the people in the regrettable instance of the passing of two Deputies from the House, told of all this, given an explanation of all this? Outside the polling booths, before their eyes, was just one explanation—12 per cent. Did they think then——

Two and a half per cent. That did not work.

It worked, and the 12 per cent worked. Twelve per cent on what? On the figures the Minister has presented to the country to pay for both and which he has presented to the county managers for presentation to the county councils to pay for the local rates, in addition to the national bill. It is now the responsibility of the Minister for Finance and is it not well he is the Minister who will have to shoulder the responsibility of facing up to the situation of which he was warned.

He cannot claim he was not warned against it when he introduced the turnover tax, as he was warned when he cut the food subsidies, consequently increasing the price of essential foodstuffs, as he was warned relative to the increased demands made on the private and public sectors for greater production, all this deliberately initiated by Government policy when food subsidies were first reduced and later abolished. In view of those occurrences, the Minister for Finance left his pronouncements in regard to the introduction of the turnover tax——

The question of the turnover tax does not arise on the Central Fund Bill. We are dealing with expenditure.

The proportion of money voted under the Central Fund Bill arises out of the fact that we have had consequential increases in the cost of living and consequential charges on the Exchequer as a result of the turnover tax. I want to know whether the Government are satisfied regarding the compensation which has been made to the various sectors of our economy consequential on the cost of living increases as a direct result not of any occurrence outside the shores of this country but of the financial policy of the Government. I want to know why there is such ill humour, why there is such resentment when the farming community require of this Government not more, but certainly not less than they have been in a position to make or have been purported to be in a position to make in proportion to the incomes of public servants and those employed in industry.

Is it not a fact that since the Governbent embarked on this insane, crazy financial road they are now traversing, those engaged in agriculture, and small shopkeepers in every town and village, have been faced with increases in their cost of living not caused by any agency other than Government policy; that they have had not alone to bear the impost on their families of higher prices for the necessities of life and for simple luxuries but also have additional increases in the cost of living resulting from the passing back of wage and salary increases to the manufacturers, distributors and retailers?

Can the Government afford to sit back at this time? Can the Minister for Industry and Commerce, who was so coy in relation to the increase in the price of bread that he kept it a secret until such time as his constituents had gone to the polls and did not announce it until the count was well and truly over, aflord to sit back? How much more have the Government concealed in addition to that little secret?

I want to know whether the Government are alive to the fact, or whether the Minister for Industry and Commerce is alive to the fact, that there are projected further increases not alone in the prices of luxury goods but in the prices of every essential commodity which any person in the State has to purchase. Are the Government satisfied in the circumstances that it was fair for them to imply that the increases in wages for industrial workers in the city of Cork and in Kildare and for State servants in both areas were, in fact, real increases in their salaries?

Is it not true that in the short time since these increases were awarded there have been indications of much of this money being recovered in, for instance, differential rents? How much will the Minister for Finance take back out of the other pocket when it comes to implementation of his income tax code? By the time the real effects on the cost of living are felt, by the time the bus fares and the train fares have been paid, how much will, in six months' time, these increases, donated a few weeks ago, be worth in terms of real improvement in income? How much will be left in the pockets of the beneficiaries of these increases?

The Minister for Industry and Commerce lectures frequently to employers in the country on efficiency, management and control of their concerns. He advises employers to be more efficient and he advises the workers to respond to the increases and work harder. In that way, he says, the economy can bear the impact of this 12 per cent increase. It is implied that unless that occurs the economy is in danger. I submit that one ounce of example is worth a ton of exhortation.

On the very day that we read in the daily press the statements of the Taoiseach expressing his concern for the first time in the present situation and of the Minister for Industry and Commerce delivering one of his exhortations yet again, we had the announcements from semi-State bodies that they were unable to carry this additional charge imposed on them by increased costs and that they would have to pass it on to the consumer.

Hear, hear!

How can this Government or the Minister for Industry and Commerce hold their heads up or talk to anybody employing labour in this country, anybody engaged in industry or anybody engaged in providing any service in the State, if they themselves cannot give an example of absorbing by better management, by harder work, the increases within the very body which they are managing? It is a farcical situation and it takes people with very hard neck to come and talk to the people, as they are talking to them these days, in face of the consequence that arises directly from mismanagement of the affairs of the country.

I recall, before this Government assumed office, the basis on which they went before the people. I do not like to weary the House by repetition but the statements made by the present Taoiseach are on record, when he was seeking office, when he went to Clonmel and stated that the level of State expenditure by the Government then in office was excessive and that if he and his Party were given authority for government in this country, by effective examination of all Departments of State, it would be possible to effect such a reduction that the people would not be called on to bear the same level of taxation as then existed. How quickly that scene changed when he assumed office. What a different situation exists today and unfortunately, as has been said too truly, this is only the start. It is only the beginning of the story.

This Minister for Finance, sitting here now representing the Government, in his first Budget, indicated, and, mind you, he commanded a lot of support in the country, that he was confident he could effect such economies in public administration that we would need fewer civil servants to administer the country. In consequence, there were leading articles in the daily newspapers the following day commending him for this assurance. Can the figures revealed in Parliamentary Questions recently support the claim which the Minister made, not after any dinner, not lightly, but in the course of his Budget Statement here?

I am sure that cool and calm consideration was given to the preparation of the Minister's statement. What consequences has he to show as a result of the supposed examination that was to be carried out into the operation of every Department? If he has failed to effect those economies, we can only assume that the Taoiseach was talking through his hat in Clonmel in asserting that in fact extravagances existed in the administration of the Government who were in office before he assumed office. It is true that the Party now in office secured much support at that time on the basis that they would be more effective, that there would be an abler group of men in the Ministries, to ensure that the expenses of administration would be reduced and that, consequently, the burden of taxation would be lowered.

Since that time, much legislation has been enacted in this House which was not paid for by the collections of the Department of Finance but much of which was passed back on to the shoulders of the local authorities throughout the country and which are now reflected in the extraordinary demands being presented by county managers in every local authority throughout the country and by city managers, too, in respect of the bills the ratepayers will have to meet during the coming 12 months.

I know the Taoiseach expressed sympathy and, in the long term, again we must accept this with a grain of salt because of his claim at Clonmel and of the claims of the Minister for Finance in his Budget Statement. The Taoiseach claims, though some time has elapsed since he first gave vent to these feelings of sympathy, that given time, he thinks he can evolve some mysterious solution to the difficulties encountered in the payment of rates. But this Minister for Finance, by a stroke of the pen tomorrow morning, could relieve the ratepayers throughout the country by at least 1/- in the £ on the rates if he exempted from the rates what he is extracting from them in the turnover tax.

Local authorities, because of the operation of the turnover tax on such items as food and other commodities used in local institutions, and on road-making and other materials used in the maintenance of local services, have to contribute extra revenue to the Central Fund. If the Minister for Finance is sincere, and if the Taoiseach is sincere in his expressed sympathy for the ratepayers, by a stroke of the pen, they could relieve the ratepayers in the cities of Dublin and Cork and in the administrative areas of all other local authorities throughout the country, to the extent of 1/- in the £ on the rates. There are people who would like to believe that this turnover tax issue is dead and gone.

I would remind the Deputy again that the question of the turnover tax does not arise on the Central Fund Bill, which deals solely with expenditure. The question of taxation will arise at a later date.

The expenditure arises from the fact that we have now a spiral in the cost of living produced by the Government's action in introducing the turnover tax. It is the root of all evil.

The Cork people did not believe that.

They did not believe that a penny would be put on the price of bread the following week.

That is finished.

The Minister would like to interrupt me and put me off this subject, and his colleagues would like never again to hear this subject mentioned.

They will hear it.

They will, and they will hear it constantly. The leader of the Labour Party indicated here this evening that, were it not for the turnover tax, there would not have been any need for the ninth round. He indicated to us that since the ninth round was agreed upon—not by the Government who have claimed credit —by the employers——

They made it possible.

The Government said eight per cent was the limit the economy could afford to bear, did they not? It was the employers who decided on the figure of 12 per cent, not the Government. The Taoiseach said eight per cent—not more than eight per cent.

I heard that.

And no doubt the Minister believed it. If the Taoiseach said it, it was wrong.

It is of no importance.

The Minister says what the Taoiseach stated is of no importance. That is clear. We have that on record—that what the Taoiseach says is of no importance. At least we have come to some decision. The Taoiseach said the economy could bear eight per cent, but the Minister for Finance says that is of no importance. At any rate, the employers fixed the figure at 12 per cent. It was presented to the people of Cork and Kildare, the people of Dublin and the people throughout the country, that this was a realistic increase. They were not told that the price of bread was going up by 1d. the following day. They were not told that bus fares and rail fares were going up but they were told that industry could absorb this increase by working harder. At the same time, the Government State-controlled bodies passed back on to the shoulders of the community every single penny involved in paying the increase in wages.

They expected the people to work harder in industry. They expected management to be more efficient. At the same time, the bodies controlled by the Government, on the very same day as the Taoiseach and the Minister for Industry and Commerce made these exhortations and announcements, directed those increases on to the shoulders of the community. We have already taken back from the people— it was actually only a loan they got— what was given to them. It was given to them only long enough to give Deputy Briscoe a chance of getting payment on the bets he made. I have no doubt Deputy Briscoe's wagers have been redeemed.

This does not arise on the Central Fund Bill.

Whether people were employed or unemployed, whether they worked on the land or in the shop, they know today that bread has gone up, that flour is going up, that sugar has gone up 1½d a 1b and that bus fares have gone up. Deputy Briscoe's constituency will be affected by the increase in bus fares, but I am sure they will rejoice at his victory and will not mind paying the increase. Every time they sit in a bus, they will pay for the financial policy of Deputy Briscoe's Party.

They are pleased with it.

As was clearly shown in the First Estimate, Social Welfare, and repeated in the Book of Estimates, outside the turnover tax, we are to have higher charges exacted by the Minister for Posts and Telegraphs. Will Deputy Briscoe's business associates throw their hats in the air with delight? Last year they paid retrospective taxation in corporation profits tax. This year they are secure in the knowledge that they will have to bear an additional impost. They are paying additional rates and wages. But they can meet all that by passing on the burden to the consumers.

Deputy Briscoe assures us they can do it, but the semi-State bodies cannot do it. They are more efficient than the semi-State bodies? Are the Government alive to the fact that so many sections of our community have not yet got increases in income to enable them stand up to the increase in the cost of living? Will they ever get it? What will happen to the person who invests money and depends on what he gets on dividends? We were told by the Minister for Finance—not by anybody outside the House—that in the course of a few years the £ has so deteriorated that today it is worth only 15/5d. compared to five or six years ago and worth only 6/6d. in relation to the values of 1937.

What will it be worth in five years?

What will it be worth in five months? Can we listen to the radio, look at television or open a newspaper without having some announcement of an increase being passed on to the shoulders of the consumer? Do the Government feel that consumer resistance is completely gone? Do they feel nobody is concerned? We remember the wails of woe at the time the loaf of bread was reduced in size by a slight margin. Is there any concern by the people who were at the wailing wall at that time in relation to the major increases in the price of essential foodstuffs due directly to the Government's financial policy?

What steps do they intend to take within the coming weeks—they have to act quickly—to compensate the people who own small businesses, those who are self-employed and those who have limited incomes from investments, to compensate them for increased national and local expenditure as well as increases in the prices of essential commodities? I am not referring to the increase in the price of brandy or in the price of any other luxury item. I am dealing specifically with increases in essential foodstuffs, clothing, medicine—the things any human being is obliged to buy any day of the week.

I want to know in relation to what has been described as the backbone of our economy—the farming community—when the Government will get out of the fit of resentment at the fact that these people should make any claim on them to improve their lot. I want to know when the Government will indicate to them they will be given increases commensurate with the supposed increases which were given to other sections of the community. I want to know whether the Government will be in a position to convince those who received increases in wages and salaries a few weeks ago that what they got then will be worth as much in five or six months' time. In our national and local expenditure we are going into an inflationary spiral, in which the non-political managers of local authorities indicate clearly the extent to which the increases they have asked the people to pay are caused by deliberate Government action. They are not caused by the extension of services but in order to maintain the services of 1963-64 and 1964-65.

What situation have we in relation to national taxation? A complete reversal of every claim ever made by the Party in Government of what they would achieve given office. We have the indications of an occurrence which was clearly portrayed for this Government when they embarked on this road, completely contrary to the claims of the Taoiseach, the Minister for Industry and Commerce and other Ministers that it was within the province of those in employment and working in industry to create a situation in which the increases could be absorbed without being passed on to the shoulders of the community. Can this Government stand over the cost of living increases in recent weeks and the cost of living increases which are projected? How can they stand over the figures that must be released of the cost of living index figures in the months to come? When that arises will they succeed in persuading the people that the increases they got were real increases? Can they satisfy the community at large that they themselves in the conduct of their various Ministers and in the influence they exercise on the semi-State companies are giving the example to those whom they exhort, lecture and address so frequently as to how they should run their concerns more efficiently and absorb these increases?

Unfortunately, that is the picture; and that is the picture we will have to face up to. That situation has been created entirely by the financial policy embarked on by this Government, first when they introduced the turnover tax and, secondly, when they were obliged to meet the increase in the cost of living —far in excess of 2½ per cent—by giving the awards necessary to cushion the impact of the cost of living increases on so many people not in a position to demand and secure such an increase. They have not yet met the demands of huge sections of the community who have had no increases in their incomes to cushion them against the impact of the increased cost of living. Those are the people now subject to additional increases in trying to meet the awards necessary to compensate those in a position to secure such awards.

This is the vicious spiral in which we are. It will be interesting, when the Minister replies to see whether he will be in a position to tell us what measures the Government propose to take to remedy the situation which they alone have created. What advancement do they propose to offer to those sections of the community who have had no indication of what the Government propose to do relative to the difficulties in which they are? Some years ago there were boasts in relation to our competitiveness. Today we hear many protestations of the importance of our maintaining a competitive position vis-a-vis exports. It is a matter of concern that today we demand a level in our standard of living that must be met—there is no difference of opinion about this—by an increased volume of exports. It is not well that after a long, hard and expensive education, the Government now realise the importance of the store cattle trade and its contribution to our exports? At one time the Government claimed that it took hundreds of years to build up and that it would not take 100 days to destroy. It is well today that we have that trade, and we are lucky to have it.

We have also an improvement in the level of our exports as a consequence of the provisions of the 1956 Finance Act which introduced new methods for the encouragement and growth of our exports. They were adopted by the Government and, indeed, extended by them when they came into office. The Industrial Development Authority was initiated by us and has contributed to the increase in our exports. We heard protestations by Ministers about the challenge with which we were presented in the export markets and the many factors weighing against us in the various combinations and groupings in the export markets which demanded more and more controls in our costings. We were lectured by Ministers that it was essential to maintain some control over costs of production and now the Government are acting completely contrary to the principle of keeping down production costs, because they are imposing higher costs on the people engaged in exporting.

Has the picture changed so radically since the Taoiseach brought in his pay pause proposals? He claimed that it was essential that we should maintain control over costs. In what way has the picture changed since? We have had a complete reversal of the policy he then enunciated. What has happened since then? Is the Minister satisfied that the occurrences of the past few months will not make it extremely difficult for our exporters to face growing competition? If we cannot succeed in resolving this difficulty, we will again have to face a grave imbalance of payments. In the past, that imbalance was created by something completely outside our control, but on this occasion, the inflation will be a direct consequence of the Government's financial policy.

We did not wait until the event to warn the Government of these impending occurrences. We warned them of the results if they embarked on that course. Our view of the situation is borne out by the Book of Estimates, with increased costs of administration for every Department of State, an increase in the cost of living, and an increase in the cost of operating local councils. Unless the Government can control the increase in the cost of living and prevent a further reduction in the value of money, life will be extremely difficult for many sections of our people.

This is a very serious matter for the country and for all sections of the community: business people, workers, professional people, farmers, and people in all walks of life. We have now reached the stage where the Government are allowing the entire situation to drift as if there was neither leadership, nor policy, nor anything to be aimed at. The only time the Government considered the effects of rising taxation, emigration, unemployment and high prices was when they were out of office.

The Deputy will appreciate that the question of taxation does not arise on the Central Fund Bill.

I do, Sir. The only time the Government gave any serious thought to the problems facing our people was when they were out of office. I should like to ask the Minister—and I am sure he has been asked already tonight—what proposals the Government have in mind to implement the promises and pledges they gave to the people before the last election to reduce taxation, reduce the cost of living, and give a higher standard of living. That is exactly what they promised to do.

I recall how so many people applauded the Government when it was announced that they intended to undertake a campaign to reduce the number of civil servants in order to save expenditure. It was clearly pointed out by a Government spokesman that considerable reliefs could be brought about and that the heavy burden of taxation, which at that time they said pressed too heavily on the shoulders of our taxpayers would be considerably relieved. They knew very well that there is a section of the community who like to hear that the numbers of civil servants will be drastically reduced. They knew there were many people who would be inclined to fall for propaganda of that kind, although they had no intention, plan, policy, or scheme, for reducing the number of civil servants.

We have now reached the point where national and local taxation have gone beyond the paying capacity of the people. I wonder when the Government will face realities, because it cannot be possible that they are unaware of the fact that serious and grave hardships are being imposed on our people today, on people whose incomes are not sufficient to purchase the necessaries of life. A big section of our people are unorganised and have no trade union or anyone else to fight for them. Retired pensioners, people who have to live on small incomes from small investments, people who have to live on incomes derived, let us say, from ground rents, have got no 12 per cent increase. Seemingly, they are a small section of the community who do not show their strength at election time. Since they do not show their strength in an organised manner, the Government are prepared to turn not only a blind eye to them but a deaf ear also.

Those people are in a very serious plight and there are thousands of such people in this country. They are faced with increases every morning the newspapers appear. Every evening on the radio, increased prices are announced for practically every commodity. The most serious of those increases are the increases in the prices of essential foodstuffs—bread, flour and meat. Why have the Government stood idly by? Through their own deliberate action, they have been responsible for inflicting severe hardships on the weakest sections of the community who have neither the trade union movement nor any organised movement behind them. Those people to whom I refer certainly do not count in the opinion of this Government. Their conditions worsen. They have to meet increased bus fares. They have to meet increased prices for bread, flour and meat. On top of all those increases, they have to face a severe and a sharp rise in rates, which must be paid.

I am now told that the next round of increases is likely to come from the ESB with steep increases in the charges for electricity. Surely the circumstances of these people must be taken into consideration? Surely the Government must realise that they have some responsibility to that section of the people?

Take the section of the community who have been entirely forgotten, as if they were non-existent, the agricultural community. The Government also appear to be bankrupt of a progressive agricultural policy. Those who are living on the land and producing real wealth from the land seem to be getting the least margin of profit as a result of their hard work. Where would we be today if it were not for the export of cattle and our geographical convenience to the British market?

The increases in the cost of living concern not alone the organised worker but every citizen in the State. The Government are allowing the position to drift. No action is taken in relation to excessive charging and we do not seem to have a policy to effect price control.

The Minister for Industry and Commerce says he is investigating bread and flour prices. Can it not be considered a mean, low, savage trick on the part of the Minister for Industry and Commerce and the Minister for Finance that during the counting of the Cork and Kildare by-election votes, arrangements were being made to have notices printed announcing increases in the prices of bread and flour? Not alone is it a savage and a mean trick but it must meet with a degree of revenge, long or short. There was no talk of the increases in prices before the votes were cast in the by-elections. However, when the Government could say, as a result of the by-elections, that they had the confidence of the people — which they have not, because they do not reflect one way or another on Government policy—the people were told of the increased prices.

The increased CIE charges will involve severe hardships on the working-class people in this city who must get to their work. Take the person who must get from, say, Kildare Street to Arran Quay. He must take one bus to O'Connell Bridge for 4d. and another bus to Arran Quay for 4d., making 8d. in all.

That would be for the Estimate.

I shall raise it on the Estimate, when it comes up. Surely the Minister for Finance must realise that all these increased charges are lessening the purchasing power of the people's pay packets? When the 12 per cent increase was announced, every wage earner understood it was automatically being granted. What about the employers who cannot economically run their business and pay the increased wage? What about the vast number of industrial concerns that say: "We shall pay it but at the same time, we must reduce our staff"?

The numbers of unemployed are increasing in recent weeks and are likely to continue to increase. Certain industrial concerns are already working on a very slender margin of profit. In some cases where they are just keeping their heads above water and managing on overdrafts, the concerns say the only way they can pay an increase of 12 per cent is by trying to manage with fewer men.

The Government urge increased production while endeavouring to handcuff and blindfold the industrial concerns. The Government ask the concerns to expand and to produce more and, at the same time, in order to exist, they must have fewer people in their employment. It is a wrong, a disastrous policy. On an occasion such as this, one would expect the Minister for Finance to have some proposals for the future in relation to employment. As a result of the bungling of our financial situation by the Government I foresee increased unemployment. Furthermore, a number of industrial concerns such as the woollen and worsted industries, and other industries, will have to meet tariff cuts. If, as a result of negotiations with outside authorities, quotas of such products must come into this country, our industrialists will find it very difficult to compete. It will be impossible for them to compete in such circumstances. That is why I say this Government are bankrupt of an economic policy.

It is said that this Government have the economists throughout the country working for them in an advisory capacity and that they are reaping as much from the present circumstances as the veterinary surgeons reaped from the bovine tuberculosis eradication scheme, and that was no small amount. This country may require a certain amount of advice from economists but commonsense and intelligence are also required. This Government are bankrupt of commonsense. They seem to have lost all contact with the ordinary people, who are the backbone of the country. That is why the time has come for a courageous stand in relation to this matter.

If one were to ask the Government what programme they have, either to stem the tide of emigration or to provide employment, we would be referred to the blue booklet on economic expansion. Many people do not take that booklet seriously. Personally, I think it is a fraud. Paper never refuses ink. The Taoiseach calls for a pay pause and, a few weeks later, he says the time has now come when there will be no pay pause and wage earners may look for an increase of 12 per cent in their wages.

That was a political stunt simply because the Government had not an overall majority. If the Government had an overall majority, they would not say to the trade unions and the workers: "Look for an increase of 12 per cent". They would have resorted to what they did previously— the Wages Standstill Order the framework of which the late Deputy Norton, when he became Minister for Industry and Commerce, found in the Department in Kildare Street. That was all the consideration the Government had for the trade unions and the working-class people when they had a majority. I venture to say that within the next 12 or 18 months people who received a 12 per cent increase will find that it has become smaller and smaller each day until it has been completely wiped out.

Is it not more important to control the cost of living? The Government are making no effort to control either prices or the cost of living and one of the most serious charges which we have to level at the Government is that no steps have been taken in that regard. I should like the Minister for Finance, when he is replying, to tell us what prospects he holds out for those faced with emigration today. One notices that in recent weeks no member of the Government or of the Government Party seems to be making any contribution which touches on the provision of employment or the stemming of emigration. At the same time, conditions are allowed to become more difficult for our people through rising prices. That cannot be tolerated indefinitely.

Can the Minister tell us, since the Book of Estimates has reached an all time record—unprecedented and unbelievable in regard to the volume of taxation the Minister is presenting to the taxpayers—what he has in mind in relation to unemployment and emigration? Do members of the Government think that emigration is at an end and that people are not emigrating? That may be so, but if it is, it is because all those who were eligible to emigrate have emigrated and there will be no more to go until those who are now leaving school join the list of those eligible.

In rural Ireland today, you have two sections of the community, the very young and the very old. The vast majority of middle-aged people are not in the country because they have been forced out of it by the unworkable, unsound and insane Fianna Fáil policy. There is a record bill facing the taxpayer; local taxation is at the point of explosion and the highest rates ever are being imposed by every local authority—rates which could not even be foretold in Colmcille's prophecies— and the taxpayer are now obliged to meet what they could never have imagined in their wildest dreams.

I realise that we cannot discuss the question of the turnover tax in this debate, and rightly so—we will have another opportunity of doing that— but we must bear in mind that there are a number of county managers— the county manager for North Tipperary was one—who have stated publicly that the reason for the vast increase in rates was the turnover tax, that it was because the price of bread, sugar, flour, butter, and meat for hospitals and institutions under local authorities' control had risen so much and hence the ratepayers have to pay increased rates. The Minister, in giving assistance to farmers to meet their rates bill, should bear in mind that the burden of rates also falls on city and townspeople. They get no abatement for agricultural land and are getting no assistance to meet the increase in rates. I agree that the agricultural community should be given this assistance but what scheme has the Minister in mind to assist the urban and city ratepayer?

The Government should be asked what their policy is in regard to this matter. The Taoiseach, speaking at a County Dublin Fianna Fáil convention last Sunday, said that they were considering the whole question of local taxation and rates. Mark you, they are only considering it now at a time when the whole situation is liable to burst at any moment, when the people cannot pay them, when the bill is too high. The Fine Gael Party are not sitting down now to consider it. They have already considered it.

They have?

They have a plan for the reduction of rates.

Have they?

Yes, by taking the health charges from the rates, by taking responsibility for health charges from the rates. That will effect a considerable reduction in rates. That is why I say the Fine Gael Party are the only Party who have a real policy in regard to rates and taxation. Not alone have they a real policy but they have shown how it can be implemented with a considerable saving in local taxation. I should like to hear from the Minister what his proposals are in this regard. I should not be surprised if he stood up and said he was going to appoint a commission or a board to sit on the matter for five or six years, as has happened in other matters, in the past, and then when they make a report, it will be put on the shelf to be covered with dust and cobwebs for the next ten or 15 years. This is a time for action, a time for courage and a time when the Government should look into the future with hope and confidence in our people, but bearing in mind the capacity of our people to pay and the extent of their patience which, I feel, is very near exhaustion point at the moment.

I feel very aggrieved when I see the severe hardships which are being imposed on our people not only in regard to the increase in bus fares and the price of foodstuffs but particularly in regard to increased prices for medicines. No steps have been taken to control the prices of medicines or medical appliances. It is a shocking state of affairs to say that if a person wants drugs to cure a beast, let it be a cow or a calf, he can get the drugs without additional cost or taxation but when the life of a human being is involved, he must pay tax. The Government place more importance on the life of a beast than on the life of a human being. It is disgraceful. It is a shocking indictment of this Government that they put the beast in the field—the cow, the horse, the calf in the shed—before the baby in its cradle. That is something that can only engender anger in the heart of every parent particularly the parents in the poorer sections of the community who are put to the pin of their collar to pay for medicines and drugs.

These are the points to which, I think, attention should be drawn. The Government have failed grievously. The Government have failed miserably. Their policy is now being found out and, please God, by the time the general election comes, the people will be wiser.

He is coming back to that again.

If I were Minister for Finance in the circumstances in which the Minister finds himself today, I would throw in the towel and leave it to someone else to do better. The Government have successfully hoodwinked the people. The Government should remember that, having sown nettles, they cannot expect roses to grow; having sown nettles, they can only expect to get stung. That is what will happen. By the time the general election comes, they will be a little older and a little wiser, perhaps, but no one will be as wise as Fianna Fáil after the next general election.

Having seen the result of the Kildare and Cork by-elections, I thought that Fine Gael might at last try to be constructive. All I have listened to for most of this evening is the same balderdash as I have listened to now for the past 40 years or so. Fine Gael never change. They always make the same speeches. They always trot out the same old lies, misrepresentation and shibboleths, in the mistaken idea that people will believe them. Then they sit down, satisfied they have done their duty. The people, of course, are leaving them, but they do not realise that.

I have no comment to offer on Deputy Flanagan's speech because there was nothing in it upon which I could comment. Deputy O'Sullivan talked about people having hard necks. Fine Gael certainly have a hard neck to talk about exports. They were in office from 1954 to 1957. Exports went down. From 1957 to the present time, exports, under Fianna Fáil, have gone up by 80 per cent. Now, Deputy O'Sullivan is afraid we will lose our exports because of our policy. That shows the hard neck of Fine Gael. That just about gives one an idea of it.

I want to refer now to a matter raised by Deputy A. Barry. He talked about our inflationary policy. Fine Gael published a policy some time ago; they were going to spend about £50 million more per year, with less taxation. They would drop the turnover tax, and other taxes, too, and they would spend an extra £50 million a year. That is the very essence of inflation : spend more but take less. Deputy Barry, with the typical hard neck of Fine Gael, talks about the inflationary policy of Fianna Fáil.

When I introduced the turnover tax in the last Budget in an attempt to stem inflation, Fine Gael voted against it. They thought they had a good trump card to go to the country with. Labour joined them, of course, as they usually do. I am sorry none of the Labour Party is here now so that I might address my remarks to him. Fine Gael, as I say, thought they had a good trump card. They opposed the turnover tax. They went to North-East Dublin and they won. They began pressing for other by-elections and for a general election. They got the by-elections, and they lost.

Now there is another excuse as to why they lost, some other reason altogether. The people did not realise what they were doing and they, therefore, voted Fianna Fáil in both Cork and Kildare; but, if they get another chance, they will beat us the next time. It is always the next time and, every time, they want another chance. Ever since I came in here, I have been listening to that story: they will always beat us the next time. On the last occasion on which I spoke here, Deputies on the opposite benches told me I would not be here "the next time" because the by-elections in Cork and Kildare would mean that out we would go. Deputies even had the temerity to prophesy that Fine Gael would come back with a clear majority. Their tails are between their legs now as a result of Cork and Kildare.

To come to Deputy Sweetman's speech, which dealt with the Bill, and that is more than Deputy Flanagan's and Deputy O'Sullivan's did, he said it was customary to compare the figures for the coming year, as set out in the Book of Estimates, with the figures for the previous year, which is really the current year. That, of course, is a natural thing for any Deputy to do. He went on then to draw attention to the changes made this year as compared with last year. He very rightly said that we could disagree on the proportion of capital which is not productive, and perhaps we might agree, too; that is the point. He said we could disagree on the proportion allocated to social improvement. I think the proportion is very good. He said we could disagree also on certain items that are now treated as capital which might more properly be treated as current. Again, I say to Deputy Sweetman we might agree on these things, too.

He went on to say we should have a separate discussion on capital expenditure. I do not see any great objection to that. I would welcome a discussion on capital expenditure. I do not, of course, want the kind of speech Deputy Flanagan makes; he imagines he is talking to people at the crossroads, to people who are ignorant and who do not understand State finance and State financing, and he knows they do not understand. When he comes in here, however, he should have more regard for us; he should not try these things on us.

I would be quite prepared to discuss this Capital Budget with Deputy Sweetman and others. I think it might be useful if we could get constructive criticism or constructive suggestions from the Opposition. I certainly would welcome them. It is quite possible some might say some of our capital expenditure was not necessary or that it was not spent in the right way. I should be glad to have such observations. I am sure a suggestion would be made that we should spend capital in other directions, directions in which we are not spending it at the moment. I would quite accept that from Fine Gael. Such a discussion would be a useful discussion. It would help.

Last year—we will do the same again this year—we presented a table of our proposed capital expenditure for the year. I think simultaneously the capital programme and the current programme should be discussed together, more especially as we have been accused now of implementing an inflationary policy; the subject of inflation can hardly be discussed without discussing both capital and current expenditure at one and the same time. I think, therefore, they should be dealt with together in any discussions that may take place.

Deputy Sweetman was correct in his assumption with regard to certain figures. Certain figures are given here and certain figures have been assumed. On the face of the Book of Estimates, there would appear to be an increased expenditure of £16 millions required next year over and above what was actually spent in the last year. A note is given in these Estimates that the ninth round increases are not included. I gave the figure of £7 million as likely to be the figure that would be necessary to cover the ninth round for all who are paid by the Minister for Finance, that is, civil servants, gardaí, teachers, the Army, and so on. Therefore £7 million has had to be added on. There are also adjustments in the eighth round outstanding which will require some money. I do not want to state a sum, although naturally I am trying to keep it as low as I can. There will be some amount required for that and a sum for CIE. The amount higher than last year will be at least £23 million and probably a few million pounds more.

There was a certain amount of criticism from Deputy Flanagan that we brought in here a White Paper in February last year which stated that incomes could not be increased unless there was increased production to cover these increases. The gist of that White Paper was that if incomes were increased before production was increased, there would be inflation; but, on the other hand, if incomes would increase pari passu with production, there would not be a danger of inflation and in all probability, there would be no appreciable increase in the cost of living.

That was a very sensible paper and any sensible man will see it was true. However, the Fine Gael Party and the Labour Party took advantage of it to say we were trying to peg down wages, to keep down the working man and all that kind of balderdash they go on with on these occasions. The matter was discussed by the Dáil and that was that. Deputy Flanagan said that a few weeks later the Taoiseach said there should be an increase in wages. As a matter of fact, it was more than 12 months later when he said it. That gives you an idea of the measure of Deputy Flanagan's accuracy in a lot of things he says when he calls 13 months a few weeks. Thirteen months makes a big difference in the life of a nation and in economic trends and it was obvious that a round of wages was due.

Some people say the Taoiseach thought that 8 per cent was enough. Perhaps he did—I do not know. I do not say definitely he did because I do not want to wrong the Taoiseach in any way, but I do say that any sensible man might have suggested that 8 per cent was enough. There is no use in the worker getting higher wages than are justified by production because it leads to inflation and a higher cost of living, with the result that he is not getting the real wage increase he would get if wages were related to production. If the Taoiseach thought and if I thought that a figure of 8 per cent was enough, then there is no reason why we should not say it because we would be only serving everybody concerned by saying 8 per cent would be a better figure.

The Taoiseach qualified that. He said that in the interests of industrial peace——

I was about to say that. However, we would be expressing only an opinion. We in this country have not taken power to fix wages. The wages issue went for discussion between employers and employees. They argued for a long time and in the end they decided on 12 per cent. The Taoiseach said, as I said, too, that he was glad to see a settlement because it would mean industrial peace. Even if it is a bit too high and causes inflation and an increase in the cost of living, at least there is an agreement on this, an agreement which I hope will be a pattern for things in the future so that employers and employees will settle these matters between them and there will be no strikes or industrial unrest.

In connection with this also, the Taoiseach is accused—of course Fine Gael would accuse anybody of anything, not alone the Taoiseach—of saying to the people in Cork before the by-election: "You will get your 12 per cent" and when it was over: "There are certain difficulties. The cost of living will go up." Polling in Cork took place on 14th February. On 29th January, the Taoiseach said this at a meeting of advertisers—he could not say it to a better crowd to have it advertised:

That does not mean that the general increase in wages of up to 12 per cent is not going to cause problems. Though the 12 per cent agreement is for a period of two and a half years it represents a higher annual rate of increase in pay than the expected rate of growth of national production.

That is exactly what I have just said and that was before polling took place in Cork. Therefore, the Taoiseach did not keep this back until the Cork polling was over as Fine Gael tried to give the impression. He went on to say:

That in itself could give rise to difficulties even if the increase in pay were spaced out so as not to run too much ahead of production. But the 12 per cent is to be paid in full in advance of the achievement of any expansion in output. This gives rise to particular dangers which it must be the concern of all of us to avoid or minimise.

I think that is all I need to say about that.

I was warned, I believe, by Fine Gael on the last Budget that I was going to put up the cost of living and I was told that I did not agree with that. I have stated here before on several occasions that I could take my Budget speech of last year and point out in several places where I said there would be an increase of 2½ per cent in the cost of living. As a matter of fact, when I went on to deal with all the people who were getting social welfare benefits of all kinds, people in receipt of children's allowances, State pensioners and several other categories, 1,100,000 altogether, I said we had to compensate those people for the 2½ per cent increase in the cost of living which would result from the imposition of the turnover tax.

There was no concealing of that fact because I was quite sure the cost of living would go up by 2½ per cent. Therefore, in that Budget speech, I was correct, but Fine Gael and Labour, who told us the cost of living would go up by 15 per cent, were not correct. When the cost of living index was calculated in the middle of November after the turnover tax had been imposed and when the necessary increases in prices took place, the cost of living showed an increase of three per cent. There was a half per cent difference. Fine Gael were 12 per cent out.

One would imagine, listening to the Fine Gael speakers in this House, particularly Deputy Flanagan and Deputy O'Sullivan who spoke just before him, that the cost of living always remained constant when they were in office and went up when we were in power. If they go back over the official tables, they will find that from 1954 to 1956 when the Coalition were in office—the less said about that the better—the cost of living went up by three per cent per annum and from 1957 to the last cost of living figure given in November, 1963, the cost of living went up by three per cent per annum. It went up exactly the same with Fianna Fáil as it had gone up with the Coalition. But look at the difference. The difference, of course, is that when they were here, they did nothing. Exports went down. The national income remained practically static. Unemployment went up to 100,000; it is now 60,000 and they are finding fault with it. Emigration went up to 40,000; it is now 20,000 and they are finding fault with it.

I could go over many items showing increases when the Coalition were in office. When the cost of living went up under the Coalition, the people got nothing for it. The cost of living went up under this Government, too, but if it did, the people got a good return for it. The national income has gone up by practically 50 per cent during the time Fianna Fáil have been in office.

Deputy Corish, who spoke after Deputy Sweetman, made what appeared to me to be an astonishing statement. He said he was always prepared to examine propositions made by the Government and where he found they were good propositions, he would state his approval and would say that we must have the money to pay for it. My experience of Deputy Corish and the Labour Party, since I became Minister for Finance, is that they never approved of any expenditure— never. They would always vote against anything I put up—not turnover tax alone. A penny on the pint, a penny on cigarettes, twopence on the glass of whiskey—it is all the same what you put up to them, they will vote against it. While they would know that in many of these cases the proposition put up was designed to enable us to give 2/6d more to the old age pensioner, they would vote against the money to pay for it.

As I have said here before, I say again that we have the courage to give these benefits to the old age pensioners and others. We have the courage also to go to the people and say: "You must pay more in order to give these benefits to the old age pensioners, and so on". The Labour Party, who talk so much about doing more for the old age pensioners, are not prepared to risk a single vote to do it. They are not prepared to risk the vote of the man who takes a pint, who smokes cigarettes or who takes a glass of whiskey. They are afraid that they will lose a vote if they approve of the extra taxation involved. Of course Fine Gael are the same but they are beyond redemption. I do not refer to them any more.

The only plank left now in the Labour programme, as far as I can see, is control of prices. I am definitely against control of prices because we tried it once and the result was that prices went up. It is perfectly obvious that prices will go up in many cases if you resort to control. For instance, take butter in the city of Dublin at the present time. Everybody knows that butter can be got by any shopper who is prepared to go searching for it at much below the ordinary price fixed for the consumer. Of course, if it goes to a tribunal to fix a price, the tribunal will have regard to all the costs of transport, the cost to the retailer, the increase in wages on the retailer and there is no doubt whatever that they will put up the price to at least what it is at the moment, if not higher still. That is what they did in 1940 when we put on control. They put all the prices up. I was Minister for Agriculture. I remember when butter and bacon went up in price because the shops at that time made such a case to the Controller that he agreed with the shops that they had a good case and fixed the price higher than it had been up to that. The same would happen with other commodities.

Labour should have some originality. They should try to think of something else besides this dead horse of theirs they are trying to flog—control of prices.

Somebody said that the Government went down to Cork and Kildare and claimed that they were responsible for the 12 per cent increase in wages and salaries. They had a right to say that they were responsible for the conditions that made it possible to give the 12 per cent. After all, if the Government had not pursued the policy they did pursue and had not built up the industries and built up the incomes all over, built up exports, and so on, as I have already enumerated, that 12 per cent would not have been possible. Nobody would think of recommending 12 per cent in 1956, at the end of the Coalition period, because I suppose those who were left in employment at the time were very glad to carry on as they were and glad that they were not put out like many of their comrades.

Somebody spoke about a State company. I think he had in mind CIE. I quite agree that manufacturers, for instance, generally speaking, should be able to organise their business to meet an increase in wages occasionally. They should all the time be improving their technique, improving their organisation, and so on, and be able now and again to give an increase in wages and many of them are doing it and have not put up their prices. But I must say that I cannot see how an organisation like CIE can meet an increase in wages except by putting up the fares. If any Deputy can suggest to them or to me another way of doing it, we would be glad to hear it. Personally, I cannot see how it can be done.

We were told by Deputy Corish that we have not made a spectacular reduction in the unemployment figures. It is not spectacular. I have often said in this House already that we are not satisfied with our achievement in regard to unemployment, but, at least, we should not be criticised by the Fine Gael Party or the Labour Party, considering the figure they left us when they went out of office in the beginning of 1957. It was 100,000 at that time. It is down to 60,000 now—a vast improvement, but not good enough, and I quite agree that we should try to do much better, if we possibly can.

Deputy Sweetman raised one point, looking for information, with regard to rates on Government property. The Estimate shows a decrease of £29,000. This is due, I believe, to a payment of £66,800 by the Post Office in respect of rates on premises occupied by that Department. Without this payment, the Estimate would have shown a net increase of £37,000. I think that is the explanation Deputy Sweetman was looking for.

Question put and agreed to.
Agreed to take remaining Stages today.
Bill considered in Committee.
Sections 1 and 2 agreed to.
SECTION 3.
Question proposed: "That Section 3 stand part of the Bill".

Why do we always assume that no revenue at all will come in between now and 1st August?

That is an old custom. I do not know.

It is an odd one, is it not?

Question put and agreed to.
Section 4 agreed to.
Title agreed to.
Bill reported without amendment.
Bill received for final consideration and passed.

This is a Money Bill within the meaning of Article 22 of the Constitution.

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