In relation to the provisions of this Bill to increase the total amount that may be guaranteed to Aer Lingus Teoranta from £5 million to £6 million, I have no objection or comment whatsoever to make. It is understood by all of us that the cost of aircraft that have to be purchased from time to time must be and is rising and, accordingly, it is necessary to meet that increase and that rise.
However, I must say that I do not accept the position in relation to section 2 in the naive way that the Minister has indicated. Section 2 in its present form is wholly undesirable. What section 2 means is that not merely Aer Lingus but any of the State bodies concerned may contract a foreign loan without the consent of Dáil Éireann in a particular instance. That is wholly undesirable. It is undesirable, I think the Minister would agree, that he would come to the House in relation to a foreign loan of any sort.
The original State Guarantees Act of 1954, which provided in its Schedule for six different State sponsored bodies, was for a total of approximately £18½ million. That amount has since been increased. Offhand, I do not know the total increase that has been made by amending legislation in relation to guarantees that may be given. I do not know whether the Minister has the total figure to his hand or not but, from recollection, there have been some substantial increases down through the years. Indeed, the figure for Aer Lingus of £6 million is not mentioned at all in the initial Schedule, so that the amount involved must be now at least £25 million and my recollection is that it is very much more substantial.
I do not think it is desirable that a State sponsored body and the Minister for Finance, without informing or getting the approval of the Dáil, should engage in foreign borrowing of a sizeable sum like that. I can certainly visualise the way in which Fianna Fáil would make the welkin ring if they were in Opposition and the Government of the day were making such a suggestion. To put it at its very minimum, there should be provision for an affirmative resolution by Dáil Éireann in the event of there being a foreign borrowing guaranteed under the provisions of section 2 of this Bill.
I am not suggesting for one minute that the purposes for which the borrowing might be made might not be excellent purposes; I am not suggesting for a minute that it would not be quite good commercial practice but away over and above commercial practice there is here involved a very fundamental question of policy in relation to foreign borrowing as a whole. I do not think it is right that the policy in relation to foreign borrowing should be, so to speak, by-passed in a scheme such as that now put forward by the Minister in relation to this Bill. I do not propose to debate the merits of another similar transaction now. I have no knowledge as to whether it was a good commercial transaction or not but I propose to return to the method of financing it on another occasion in this House. However, there is no doubt about one thing, that that transaction, the method of which I criticised at that time and will criticise again, was wholly opposed to the principal of financing by the authority of Dáil Éireann which we understand.
I believe it was wrong for the Minister for Finance to give his consent to a loan to a foreign power as he did in relation to Shipping Finance Corporation. The only body that should do that is Dáil Éireann. I believe it is just as wrong that it should be attempted, as it is attempted in this section, to provide that foreign borrowings can take place without the explicit consent of Dáil Éireann in the individual case. I would agree at once with the Minister that the power being sought in section 2 is not as objectionable as the other because at least the Minister is advising us in the Dáil that it is proposed to do this and we have advance knowledge to that effect. I think I would be excused, however, if I said the Minister was trying to introduce this to the House on the illogical argument of proceeding from the particular to the general.
There may be an excellent case in the present circumstances for Aer Lingus borrowing the amount that is involved in the New York market, $15,000,000, and there may be an excellent case for the Minister asking for authority to guarantee that specific loan in the New York market. What the Minister is asking us to do today is not merely to permit him to guarantee the Aer Lingus loan but to permit him, in addition, to guarantee any other purchase which, for example, Grain Importers, Tea Importers, Steel Holdings or the Potato Marketing Board might make in another country and to guarantee that no matter what may happen in regard to the devaluation of sterling.
I am glad the Minister set out in his statement a specific reference to what would occur if there was devaluation. It is only ten days since it looked very likely that there would be a devaluation of sterling. Some people believe that the danger of sterling devaluation has not even yet passed. The effect that devaluation in London would have on us here is something which we need not consider but it is something which would be, as I am sure the Minister will readily agree with me, very grave indeed.
We should not, therefore, take the opportunity because it is felt that a guarantee for one State body is desirable, of giving an omnibus or a blanket authority for the purpose. Aer Lingus, for example, is a body which by its very nature and by the essence of its operations earns substantial foreign exchange. It is a body which because of that earning is better equipped to deal with foreign borrowing than another body. I do not think the Minister, or any Minister for Finance for that matter, would give authority to the Potato Marketing Board to raise a loan in New York. The Minister will agree with me when I say it would be highly undesirable that it should do so. Why so frame the legislation, in that event, that it enables it to be done?
I know the tendency of draftsmen and of the Civil Service—and I do not mean this in any way as a criticism of the Civil Service at all—is to include always in a Bill the greater rather than the lesser. They naturally want to avoid having to come back to their Minister and to say afterwards: "We did not get authority for this or for that." I can understand the Civil Service approach and I do not say that in a critical way of the Civil Service because I think we are extraordinarily fortunate in the manner in which we— by "we" I do not mean Ministers or Deputies but the whole country—are served by the Civil Service. However, it is the natural Civil Service approach and it should be the natural approach both of the political head of the Department for the time being and of the Deputies in Dáil Éireann to curb such a wide general approach.
This is a specific instance in which it should be curbed. This is a specific instance in which, rather than the general power that is incorporated in section 2, there should be included in this Bill a specific power enabling the Minister to guarantee specific borrowing for which he can make the case, whereas in many other cases it would be quite impossible for him to make it.
I would urge the Minister to think again and to change the omnibus provision he has got in either of two ways: either to restrict it to the Aer Lingus borrowing we have here, or, alternatively, provide that, before such a guarantee can be given, an affirmative resolution must be passed in this House to permit the Minister to pledge the credit of the country in a guarantee other than our own.
