Through our speakers, we have expressed our view that we consider this Budget as one the main provisions of which appear to be out of touch with social and economic realities. We have based most of our arguments on this failure which we see in this Budget. It has been mentioned during this debate that there is a possibility later this year, if the Government's nerve fails them, of a second Budget. I should be glad to know from the Minister whether he sees this as a final and conclusive Budget for 1968 because there are causes which may tempt the Government to introduce a second Budget later in the year. These are the same causes as suggested to the Government that they should push for extra Budgets and for a damping down of demand in our economy in 1964-65. The NIEC and the Department of Finance itself suggest that we may be running a deficit in our balance of payments later this year.
Since our people are supposed to be managing our economy in a modern fashion, I hope that nervousness about running a deficit in our balance of payments will not tempt the Government into trying to damp down demand in our economy this year. We should keep our nerve if we run a deficit and see that our purchasing power is kept up. This is one of the reasons for the setback suffered by the economy in 1964-65. I hope that if anything similar occurs this year, we will not by means of a second Budget—in 1964-65, we brought in a wholesale tax—attempt to rectify the position and that the Government will resist that temptation. As they are a nervous Government, at the end of their 12 years in office, I hope they will not bring in any draconian measures.
One matter referred to in the Budget Statement deals with improving efficiency in industry. The Taoiseach, when in Killarney this week, referred to this problem. He referred to it in a context in which we would be wise to remember it. He announced that we were steadily reaching the point in which more of our home market was being given over to imports from Britain—one of the results of the Anglo-Irish Free Trade Agreement. He felt that we must urge industrialists to become aware of this challenge on our own home market. Surely if it is time to realise that we have got to face these problems on the home market, it would be wise to ask for a review of the Anglo-Irish Free Trade Agreement now. It is the feeling in many circles that this Agreement should now be reassessed because not even the authors of that Agreement, the present Government, would deny now that they signed it in the belief that we would be in the Common Market before its full effects were felt on our home market. It is now openly admitted in the Budget Statement that we cannot expect to be admitted until 1972. In 1970-71, industry will be facing severe competition from our mighty industrial neighbour and there will be very few compensatory factors to make up for this battlefield on the home market for our own products.
In this situation, and honestly admitting the error of signing the Agreement, even though we may have signed it in good faith, and although certain expected external events did not materialise, we should, in order to defend our own vital interests, seek a review of this Agreement, perhaps in order to lengthen the period during which tariffs were to come down but certainly we must insist on an urgent review. Devise any formula you like, or put forward any excuses you like, the economic facts still call for a review of the Agreement as soon as possible.
There have been references to what has been described as the lack of management on the social side of the Budget but we would describe it more accurately as a Budget which is out of touch on the social welfare side. It is out of touch in the amount the Minister thinks should be sufficient to convince people that the Government were really serious about helping those who come under the social welfare code. It is out of touch in its failure to begin to outline the elements of a distinctive social welfare policy for the real cases of poverty which still exist. It is also out of touch in regard to the amount set aside this year for housing. We have been falling behind the target we set out to achieve in the matter of the provision of houses. Under the Second Programme, the figure suggested was, I think, 13,000 houses per year. We have not been achieving that target and, judging by the amount of money set aside under the Capital Budget this year for this purpose, one cannot see a sufficient number of houses being provided in the years ahead. This is a very serious situation. Anyone familiar with city areas especially knows the distress caused by bad housing conditions. The situation calls for urgent action. There must be no delay, no putting on the long finger. The housing problem must be tackled immediately. Solving the problem will require a much greater amount of money being provided in this social priority area than is provided in this Budget.
Possibly the biggest weakness is the failure to legislate for a distinctively Irish programme in social welfare. Our social welfare code suffers from the weakness of being borrowed piecemeal from Westminster. No real consideration has been given to the problem of poverty in this country and to the way in which that problem should be tackled. Whilst examination is needed over the entire field of social welfare, I do not see how we can postpone the patent necessity of improving children's allowances until such time as examination has taken place in that particular area. One has a good idea of the size of the average family and one knows that the effects of poverty are felt most frequently in the larger-sized families. Children's allowances should be increased immediately. They have not been touched since 1963. One would have expected immediate concrete action in this Budget rather than waiting for an examination to take place before taking action at some time in the future.
The whole question of foreign capital coming into the country should be examined in conjunction with the linked problem of the feasibility of getting more Irish capital invested in our economy. The Minister has indicated that he will consider the setting up of an Irish money market. Such a market is overdue. It is most essential. If prospective examinations are the excuse for lack of action in the field of social welfare, examination is certainly urgently needed in the area of foreign capital coming into this country. It is important that we should know where exactly this capital is invested and how much is what is called "hot money". It is most important that we should know how much is involved in investment here which gives a greater potential for expanding employment and how much of such capital will in the long term be of benefit to the country. Whilst there may be some short term advantage in foreign capital coming in over a particular year, in the long term the advantage of foreign capital coming in to purchase Irish assets does not seem to me to be so great as some may think it is. It does not make sound economic sense.
It is a rather strange situation to find, for example, in this capital city foreign capital coming in to take over historic areas in partnership with Dublin Corporation. It is somewhat odd to see a property company, which is mainly cross-Channel owned, taking over the area between Arran Quay and Parnell Street. That is just one example of some of the things that are happening. Irish business assets and Irish property are passing more and more into the hands of cross-Channel interests. The NIEC has sounded a note of warning and asked the Government to examine the situation very closely to see whether, in fact, we should welcome with open arms every type of capital investment coming in here and whether, in fact, the time has not come at which we should be more discriminating in the kind of investment into which we permit foreign capital in this country. Much of the foreign capital coming in is going into areas in which Irish capital should be employed, areas in which such capital could do good work for the benefit of the country and the people as a whole.
We must be very careful to maintain a close watch on price increases. There is a suggestion that, as a result of the post-devaluation situation and higher import charges, prices may increase to some extent this year. We must watch very carefully to ensure that we do not have wild-cat prices. It seems to me too little regard is had to wild-cat prices. Such prices affect the community and give rise to other problems. We must keep a very careful eye on price increases.
In this connection it is only proper to ask the Government, and especially the Minister for Finance, to take the NIEC at its word and try to frame a fair incomes policy, an incomes policy which will blueprint the relationship that should exist between the different economic interests. I suggest once more that there can be no prospect of any kind of calm in the industrial sector unless this is done and there is no point in legislating for one half of the nation's economic life—the wage and salary earning part—to the exclusion of legislation for capital-owning interests in the community. It is important that the Government should be seen to be active in this matter of framing a policy for all types of income formation. This is the only basis on which there can be orderly development in our economic activities.
Again, in relation to the type of capital coming in, such capital—welcome though it may be because of its employment-creating activities—may worsen the industrial relations climate if the companies involved do not conform to the majority practice here. It is regrettable that a large company should ignore the Supreme Court, the Labour Court and practically every other body in the country. We should call on the IDA and the other bodies involved to do all in their power to avoid misunderstanding and to ensure that all foreign industrialists coming in here are fully informed about the practices that obtain and that are expected to obtain in their relations with their employees. This is essential from the point of view of relations between our country and theirs and for the better ordering of our industrial relations. We cannot have a system built up over many years of effort put in jeopardy because a few mavericks refuse to abide by the majority rules and it is not fair to other business enterprises, which do conform, to see such practices condoned on the part of others.
This Budget does not show evidence of any definite will on the part of the Minister to introduce a Budget influenced by concepts of modern economic planning. It is a Budget which a Cumann Na nGaedheal Government could have produced in the 20's, a Budget which any Government could have produced in the history of the State. It is a Budget which, I suggested, has the look of the usual hardy annual we have seen in this House.