This Budget has been described as a mini-Budget. When you look through it, it is not so "mini" a Budget. It was very cleverly produced by the Minister for Finance. In fact the major portion of the charges to be raised have yet to be the subject of a separate Bill in this House before the impost arises on 1st October next.
When one looks at the Minister's main Budget of this year, one realises the wide range of articles on which indirect taxation has been placed. The range is so wide that while it has not been possible for anybody to point the finger of scorn at the Minister and say: "You put 6d on cigarettes or you put 6d on the pint", nevertheless when one looks at the complete range, one discovers the amount of taxation that is being levied as an extra impost on the ordinary fellow who smokes cigarettes, fills a seat in a car, drives his own car or drinks the odd pint is very cruel indeed. It is far more cruel than was apparent at the time. It is also true of the mini-Budget because we do not know yet what the full range of articles to be covered by the five per cent wholesale tax will be. Deputy O'Donnell pointed out that the Minister's predecessor was entirely opposed to this tax. Doctors differ and patients die. One in this case was a doctor and the other a barrister and many of the patients, the consuming public, are in a bad way, while others have to emigrate.
Nearing the end of this debate when so much has been said, it might be better to take a different line, and while the subject under discussion means we can discuss the same thing, I feel one of the things I should address myself to is the Taoiseach's speech. Before I proceed to do so, I should like to say that the Taoiseach, as Prime Minister of this country, found himself in the position of having to introduce a second Budget ten weeks after an extremely harsh one. One would have expected from him in such circumstances a certain degree of responsibility, a clear exposition not only of the reasons why this became necessary but also of his views on future policy. One would have thought he would have treated this in a serious way and that his speech would have been statesmanlike.
Instead, he made vulgar references to newspaper reporters who normally do their work in that posture anyway. He made fighting references to Fine Gael and asked the age-old question which Deputy Burke asks every year on every Budget: "When you walk up those stairs, will you vote against the halfcrown for the old age pensioners?" That was the Taoiseach's main theme. If we were to vote against this not so mini-Budget, we would be voting against 2d a gallon for milk, and he mentioned other things in which there was a shortfall and for which money was required. This is the most simple political trick which one would expect from a new county councillor on his first visit to the council chamber. It is not a valid attitude having regard to the position in which we find ourselves—the Taoiseach, the Prime Minister, returning for a second Budget ten weeks after a really harsh Budget. This sort of thing will not do.
I should like to quote from the Taoiseach's speech, reported at column 571, volume 223 of the Official Report for Wednesday, 15th June. He said:
To fulfil these purposes, the Government require more money and that money can be secured only by an adjustment in taxation rates. Those who voted yesterday against these new taxes must be assumed to be against these proposals, against the provision of these additional farm price supports, this additional income for farmers, and the payment of these additional amounts to the employees in the public services to whom they relate.
Further on the Taoiseach said:
That is a simple proposition. No Deputy need be confused in his mind about it. It is a proposition upon which it is possible for any Deputy to say: "I am for it" or "I am against it". The Government's proposition is that these additional payments should be made; these higher farm price supports should be given; these increases should be awarded in the Public Services as they have been awarded outside...
Our line is that it is the Government's mistakes during the past few years that have caused the necessity for this not so mini-Budget. The Government led the people astray before the general election last year and before the Presidential election this year. They did it deliberately to time the unpleasant things for the day after the people had voted and to time the hopeful statements and wonderful arguments for ante-election speeches.
It is logical for us to criticise the fact that the Government's priorities have gone wrong. It is necessary for any Cabinet, sitting with Taoiseach and Minister for Finance, to decide on priorities. On this occasion the Taoiseach refused to talk about priorities. Before the general election, he said there was plenty of money for everything. As Deputy Cluskey has said, the others shouted: "Let Lemass lead on". Let us take a few instances close to our minds. Deputy O'Donnell spoke of the spending of £500,000 on the extension to Leinster House. We built that and continued to build it but we could have done without it for a while. There are 50 families in Griffith Barracks whose husbands can visit them for half an hour a day because there are no houses for them. We have begun a major scheme of system building in Ballymun. System building is not cheaper. It is only quicker. Yet that scheme is running far behind schedule and the general opinion is that it will work out considerably dearer. A major factor in the delay is that the Government had not the money to pay the builder and, so that he will not go bankrupt, he is doing the only thing he can do, slowing down.
We are occupying the £500,000 extension to Leinster House. Arguments of whether we wanted it are not relevant. The point is that our priorities have gone wrong. Let us now consider the just case of the farmers for 2d a gallon for their milk. We do not know yet whether they will have to go to jail if they do not pay their fines. We know that the Minister for Agriculture indicated that he would not give them anything but we also know that inside six weeks he had to provide a large sum to give them a just increase. It was beaten from him, literally in the political sense. It was beaten from the Minister for Agriculture and the Minister for Finance.
Does this also not mean that we have fallen down on our priorities? Other building has gone on in Dublin with the permission of the Government while the Government of Britain stopped all non-essential building in favour of housing by putting a tax on it. If I were to suggest that the Government built the Irish Sugar Company building, I would be correct because the Government own the majority of the shares and the shareholders can dictate policy. That building was done at a time when the people of Dublin had not houses to live in. Is it not true also that at the same time the insurance companies built sumptuous new offices? It is agreed that a certain amount of insurance company funds can be put into fixed assets, into national loans. I suggest that in relation to this building and indeed in relation to the building of Liberty Hall, if the Government were to get their priorities right, they could have made it more attractive for the agencies who built these edifices to put their money into national loans which would have given us money to build the houses for our people.
The fundamental difference between Fianna Fáil and this Party, and the Labour Party when they were members of the inter-Party Government, is that we produced houses as a priority and that Fianna Fáil have relegated housing, for their own convenience, to a secondclass position. The reason is that when a Government are running into four or five elections—two by-elections, a general election and a Presidential election and one local election which, as Deputy Cluskey pointed out, has been postponed on a pretext—and they are running short of money, one of the easiest things to do is to cut down on housing. All the Government have to do in that case is to have a malleable political Minister for Local Government who will make sure sanction does not go out. That is the easy way; it is the way to get in in elections and to come back afterwards to correct the deliberate misdoings while at the same time leaving 50 families in Griffith Barracks and permitting the building of sumptuous offices.
Let us take another example of ante-election and post-election policy. Let us look at the situation whereby the Minister for Finance 11 weeks ago, one week before the mini-Budget and ten weeks after the major Budget, produced the amount of the increase in remuneration we could expect this year, a figure of three per cent. His reason was that this was the estimated increase in the gross national product. I know he is not a mathematician and therefore I do not want to go into the details of that. I am not one either but I think I know a little more about it than he does.
Anybody who looks at the mathematics of that suggestion will not be looking at it for more than 30 seconds before he realises that an increase of three per cent in the gross national product does not mean we can have three per cent. It could mean we could be entitled to 30 per cent or perhaps to nothing at all. It is merely a convenient method for somebody who looks at these things rather lightly and has his speeches written for him by his officials on all occasions. The Labour Court corrected the Minister for Finance inside six weeks. Where has responsibility gone if we have a situation whereby the Labour Court, sitting to decide a dispute before it, decides that the sum of the increase we can afford is of the order of nine per cent when the Minister for Finance says six weeks before that that the increase is of the order of three per cent? That is where the Government also made an error. They refused to budget in their major Budget before the Presidential election for the increase they knew was probable and produced instead this three per cent as something completely dishonest and having no mathematical relation to the formula they produced to support it.
There has been discussion about our borrowings. Over the past five or six years, the Government have been riding on the crest of a wave provided by the influx of capital here. This was making it easy for them until about the time of the Cork and Kildare by-elections. They were in a position whereby much of our capital works was being financed by this influx, which was also carrying our balance of payments. But when we have to resort to short-term borrowing in Germany and from the Bank of Nova Scotia, having failed to get it in America, the results of such short-term borrowings are pretty evident. When you borrow by means of a national loan here over a long term of years, the amount you have to take from the capital side of the Budget and bring up into the current Budget is minimised; but when you borrow for ten years you have to bring up a far greater amount.
As a general principle, short-term borrowing means higher current taxation. That means that the trade union organisations will naturally seek to recoup the loss to their members because of higher current taxation and you are therefore increasing the costs of production. One of the things about short-term borrowing is that it increases the costs of your export production. We have had resort now to short-term borrowing in two instances and we still have to borrow £5 million. All the indications are that the Government will go to the Bank of Guatemala, if they can get the money there, and borrow on short term there. When you borrow for ten years, four or five times as much has to come into current taxation. That is one of the reasons why we will have a higher tax situation here and a higher costs situation. This will mean grave danger to our export trade.
I would have thought that the Taoiseach instead of referring to newspaper commentators in a most improper way, instead of telling us in Fine Gael that we had a fight on our hands—we always knew that because we always knew Fianna Fáil would die hard—would have indicated his future plans for the provision of the capital so necessary in our underdeveloped country. He could have indicated how much he thought he would be able to secure in national loans next year. We have been accused of making no suggestions in this debate. The Taoiseach could have created a situation taxwise that would pay insurance companies and large corporations not to build sumptuous blocks of offices but to put their money into national loans that would build houses for our people. Instead, he indulged in the abuse for which he is famous when in a corner.
We must face the fact that there is no plan for State borrowing and capital investment. Deputy Cunningham objects and suggests if Fine Gael were in office at present, they could have every county councillor in Ireland in the Shelbourne Hotel next week. They are the people who are guilty of not planning. They are the people prepared to ride it out from one election to another on the basis of keeping their jobs. I think I have indicated that the Government have failed in their priorities. It is no alibi for them to suggest that we should get them out of the soup, although we are prepared to make constructive suggestions. I think we have made one in relation to priority in housing.
I would refer to the Taoiseach's speech again and to the fact that he chose to be derogatory of the Fine Gael Front Bench. For the purpose of making my further remarks relevant and in order, I quote the Taoiseach at column 578 of the Official Report. He said:
What an alternative Government, these shadow Ministers named the other day as the Government.
He then went on to say he was the head of the best Cabinet in Europe. I should like to discuss that. Since the Taoiseach has raised it and since it is the activities of this Cabinet that have put us in our present position, I think it is in order to do so. We are at our wits end to provide capital for necessary works. Yet we have had a series of spectacular failures in industries in which Cabinet Ministers have been almost always implicated, in which Cabinet Ministers have been seen around this town wining and dining with principals in certain industries in which there were spectacular failures. I want to suggest before I discuss these failures that when someone invests his own money, it is most unusual to have a spectacular failure within a year or even two or three years, and in some cases before the project is opened at all. When you are putting your own money down on the table, you tend to be far more careful.
I want to point to a few of these failures. We know what the situation is in Potez. We can all say now— and most people outside the House would agree—that the idea of employing 1,700 people in the construction of executive aircraft in a small country like this would seem to have been ill advised, to say the least of it. We are well aware that the Minister for Transport and Power told every Deputy in Monaghan, including his own Deputies, not to come near him as he had made arrangements for a new factory in Clones. We are now aware that the unfortunate French manufacturer who produced the machinery and brought it in in packing cases sees that the factory is now empty, with the machinery sitting in it and the factory in liquidation. The most he may get is 1/- or 2/—or let us be hopeful, 20/— in the £. We are aware that the best supporter of the Minister for Transport and Power built the factory at a cost of £40,000 and his money is also in the liquidator's net. We are aware that the factory never opened. We are aware that there is a factory connected with the Irish steel industry which was never opened in Cabra in Dublin. This was also the subject of very heavy grants and loans. We are aware that a factory for the production of food has closed in Laois-Offaly. There was a grant of £120,000 and a Taiscí Stáit loan of £90,000.
