When speaking yesterday evening, I referred to the four per cent increase in national productivity to which the Minister had adverted in his Budget speech. He made a certain amount of play with this four per cent national increase and I was making the point that I assumed that the four per cent increase was correct and, that being so, nothing had been done in this Budget to further any increase in that productivity as, indeed, nothing had been done in the last Budget to increase it.
The increase which have come about in national productivity have been very largely in spite of Government intervention and not because of it. I was linking up the effect of the 2½ per cent sales tax, or turnover tax, introduced by the Government in November last, in relation to which the Government spoke with two voices—we were told it was a very small tax, on the one hand, and that it would be anti-inflationary, on the other-and, as I said last night, these two things do not make sense. If it were a small tax, it would not have an inflationary or anti-inflationary effect. In point of fact, it was a very large tax which was to yield something like £11,000,000. The yield which has taken place since November has been well up to expectations and the Minister made no case that that tax had failed in its purpose of producing the expected revenue. It has produced more than was expected; in other words, it is buoyant as, indeed, we all expected it would be.
This tax has placed a considerable burden on the business community. I do not intend to go into that question in this Budget speech but, as the House will remember, there was a by-election very shortly before the tax came into effect and it showed overwhelmingly the public reaction of anger at this tax. At the same time we were being told by the Taoiseach we must be careful not to increase wages, we must be careful to increase productivity without increasing wages, that otherwise we would interfere with exports, and so on.
That was what we were hearing in the autumn of last year. Yet suddenly, in February, the ninth round was granted. We were told in the Budget that it was to prevent a free-for-all. As I said, it was not a free-for-all, it was all for free. There was no increase in productivity, no increase in the volume of goods produced. It was bound to have not an inflationary tendency but, as it did have, an immediate inflationary effect. It appeared to be very nice for everyone who got the 12 per cent increase; of course, certain classes of the community did not participate in that.
The cost of living has shot up since then and will continue to shoot up. There is no way the farming community, the business community or the industrial community can carry the effects of these two tremendous increases that have taken place. There is the absurd situation that a tax is imposed in November; wage increases are given in February to help meet that; then taxation is finally imposed in April to meet the costs of the February increases.
Is there not something crazy about that type of finance? What sort of economics is it, that creates a situation in which a Government has to do that? We used to expect that the Budget would be a help to industry and to people generally. This Budget has failed miserably in that respect. Where it has given anything it has given with a very small hand and, indeed, it has not given it yet; the old age pensioners, the widows, and so on who are getting the 2/6 a week extra will not get it till next August. It is a case of live horse and you will get grass. There is not very much increase for them in this Budget.
I am primarily interested in the business and the urban community, representing as I do a city constituency; there are others who are better able to put the case for the farmers. There was an idea that the ship of State should be trimmed, if necessary, for heavy weather. I do not see any trimming here except political trimming and that is what has landed us in the difficulty we are in. This is a political Budget, not an economic Budget. There is practically nothing in it for the poorer sections of the community and it does not help the business community. A little is done for the farming community but my farming friends and Deputies here have said that what is being done is not very practical. The idea that a budget is an instrument for furthering generally the economy and the economic wealth of the State is not recognised in this Budget.
When the Parliamentary Secretary to the Minister for Finance was speaking yesterday on the Budget he referred to a speech by Deputy John A. Costello. He said we did not speak as one voice. Of course, we do not speak as one voice. This Party has never been a regimented Party. We all have different viewpoints on certain matters but when joint action is necessary and desirable we act jointly. In fact it might be said that our motto is diversity in unity. We are a united Party and we hold diverse views on certain things. However, when one examines what Deputy Costello said yesterday about the Budget one begins to realise it is such an extraordinary Budget, it is such a patchwork of different ideas and different shades of economic thought that an Opposition who were doing their duty and were speaking sincerely could approach it only from different points of view.
I can perfectly well understand that Deputy Costello considered this to be a conservative Budget. It is conservative in the sense that it does not go forward and do the things which, in the 20th century, we expect the Budget to do for the state of the nation, and the well-being of the country as a whole. It is like a Budget which would have been produced many years ago when a laissez faire policy held sway and little was done for the people. That is not how we should approach the Budget, in my view. It fails completely because it is not cohesive. It cannot be said that it gives anything to the really poor sections of the community, because what they are getting is long delayed, and is not very much anyway. An increase of 2/6 is not very much. It certainly cannot be said that it helps the business man, because it does not. It cannot be said that it does a whole lot for the farmers either. It does, probably, a little more for the farmers than for other sections of the community, but that is mighty little.
The price of milk is going up by 2d. a gallon. I am glad to see the producers of milk getting what they require to remunerate them properly. Some time ago we saw dairy herds being sold because they were uneconomic. I believe 2d. on the gallon of milk means something like 5d. or 6d. on the pound of butter and, in my constituency and all over the country, the purchasers of butter will very soon find that their costs are going up very considerably. In spite of the very big taxation imposed last November—and the purchase tax is a big tax—we were reduced to the three classics as well: 1d. on the pint, so much on spirits, and so much on cigarettes. Those three old classics were taken out of the stable and given a run. That practice was probably started in Gladstone's day or before it. With the already high taxation, we thought we would not have to face an increase on those three items. I wonder how far beer, spirits and cigarettes can be taxed before the point is reached at which their sales are affected to the extent which would make them unremunerative. I imagine we are getting very close to that point now.
The price of petrol is up, too. That will not be a help to industry generally, or to CIE. I think the Minister said CIE were partly exempted, but I believe it will have the effect of increasing fares, and increasing the difficulties of that company.
I come now to the increases in the Post Office charges. They properly belong to this Budget and should have been brought in with it, but they were brought in afterwards so that they would not have the same political effect as they would have if they were introduced in the Budget. If they were, the Budget would be an even gloomier document than it is. A charge of 5d for a letter will be a very great burden on the business community. Many firms do a tremendous mail order business. They will be very heavily hit. Travel agencies and other businesses that send out a great number of circulars will be heavily hit. Indeed, there is an increasing use of circulars. With the very good, efficient and quick methods of printing, and the copying machines that are available, firms are making more and more use of mail order business, sending out advertising literature. They will be appallingly expensive now at 5d a letter.
The cost of telephones is increased. That will hit grocers very heavily. Many private grocers, butchers, and such people, ring up their customers in the morning to ask them what they want. This Budget puts up their costs, and it will be another nail in the coffin of the personal businesses as opposed to the big market places from which you carry your stuff away. I do not think the Government realise the effect it will have on a number of grocery businesses and purveyors generally.
Telegrams will now be very expensive. I think a minimum of 5/- was the figure mentioned. That will lead to a decreasing use of telegrams. Telegrams are very useful for business people, and it is very important to keep them as cheap as possible. By doing so, you get a great usage of them. If you put the price up, people will use telegrams only as they were used formerly to announce tragedies or, perhaps, some unexpected pleasant occurrences in families. Of late with cheap telegrams, people used them a great deal, and so did business generally. Now there will be an increase in their overheads.
All thinking people must be very disappointed with the Budget. The country is now going through a period of inflation which is a direct result of the Government's action. It is ironical that were it not for the three by-elections, we might not have had the 2½ per cent tax, and the 12 per cent increase. We certainly would not have had the 12 per cent increase, and we would have had an entirely different type of Budget. All this shows that we are dealing with a form of political opportunism and not primarily with something designed really to help the country generally. That is why I and many other people are very disappointed with it.