Deputy O'Connell gave notice that he would raise the subject matter of Question No. 22 on today's Order Paper on the Adjournment.
Financial Resolutions. - Adjournment Debate: Export Quota Investigation.
I am compelled to raise the subject matter of Question No. 22 because of the unsatisfactory nature of the reply given by the Taoiseach today. The question was:
To ask the Minister for Finance if he is aware that a company (name supplied) engaged in the export of sheepskins were hindered in their work by an officer of his Department investigating export quotas; that during the course of this investigation an official of his Department travelled abroad for the purpose of interviewing and questioning customers of this company; and that such action resulted in serious damage to this company's prestige and trade; if he will state the results of this investigation; and if he is satisfied that such an investigation was warranted.
In answering, the Taoiseach was evasive and did not give a satisfactory reply.
This company has been operating for over 35 years in the export and trade of sheep skins. The managing director is Mr. Patrick J. Guerin and his father before him built up this firm to the position that it holds today in the highest esteem with customers in Britain. The main business is export and trade in sheepskins and hides. This company employs a staff of over 25 and at peak times over 50. They built up goodwill and esteem abroad among the biggest customers in the business in Britain.
To export sheepskins quota licences are required under a statutory order enacted in 1956 and the procedure is that 20 per cent of domestic sheepskins may be exported. This company has secured licences for the past number of years and when a licence is issued the Revenue Commissioners come into the matter and send up an official to check the number of sheepskins going on a truck. He tallies them, identifies them and seals them. Different officials of the Department have come to do this work.
Out of the blue on 15th August an official of the Special Investigations Branch of the Revenue Commissioners called at this office and demanded private, confidential books of this company. The managing director and his brother who were not aware of the procedure or their legal rights in this matter handed over the books although they offered facilities for the officer in question to make copies of, or extracts from the contents of their books.
Three days later, having consulted the company's solicitor they went to the office of the official, Mr. Cahalane, at 9.30 a.m. He was not there but his colleague in the office showed them into Mr. Cahalane's office, provided chairs for them and asked them to await Mr. Cahalane's arrival. He arrived at 9.55 and was very annoyed that they should be in his office. Mr. Guerin asked if he could have his books returned as they were indispensable to the operation of the company's business and Mr. Cahalane refused.
Mr. Guerin, the managing director explained that he had no right to take the books away without their permission and that he misled them into thinking that he had this right where-upon Mr. Cahalane opened up his press, took out the books, flung them at them and ordered them out of his office. Mr. Guerin's brother explained that they were not there of their own accord, that a colleague of his had shown them in.
Following this, the company which had been engaged in export business, found that a customer in the North of Ireland wanted no more to do with them and refused to consider any more sheepskins from them. Another customer of theirs seemed to have heard the same story in the North of Ireland and said they were not interested in having any more dealings with this company. As a result the managing director of the company fears that their prestige, goodwill and trade have suffered as a result of a Department official travelling to the North to interview a customer of the company.
I want to emphasise that there is no question of any duties being evaded or any loss of revenue from the alleged misuse of licences by this company which fulfilled the requirements of the export licences as is proved by officials of the Department. I wonder is it this company that is on trial or the officers of the Department because on each occasion a different officer of the Department inspected, identified, counted, tallied and sealed the load of sheepskins placed on trucks for export to Britain. Is it suggested by the officers of the Department that this load of sheepskins is hijacked on the way because they are sealed when they leave the premises, after being checked by an official? I should like to know if the various officials who did this work were investigated by the Department or is it suggested that the officer at the port of exit was guilty of some breach of the regulations?
It is well known that this is a very competitive business and that a company has its rivals. It would suit a rival to send in a complaint to try to disrupt the company's business and even if only for six months to destroy its export trade. The Taoiseach, as acting Minister for Finance, must know this, must know who made the complaint and must know if this investigation was carried out for any particular reason. Was there justification for it or were the officials of the Department who checked, tallied and sealed these goods in question or on trial? He must know if they are investigated. I should like to know if a report on their integrity is available before any offices of the Department can disrupt a business such as this which has enjoyed prestige and goodwill over so many years and is now hindered in its working by the action of the officials. I should like the Taoiseach, in his capacity as Minister for Finance, to answer these questions. I should also like to get an assurance in this House that there will be no question of victimisation of this company. I should like an assurance from the Taoiseach that there will be no question of the officials of the Department carrying on a campaign of revenge in an effort to ensure that they are right. I should like this assurance from the Taoiseach. I should also like an assurance that there will be no hindering of this company in its operations. They have suffered enough. They have lost exports which are also a loss to the country.
It is vital that a review of this statutory regulation should take place. It is anomalous that export licences should be required for sheepskins and not for hides. It is a fact that there are fewer tanners and others employed than when the regulations were first made. The existing regulations impose restrictions on companies who are trying to improve the export trade, thus adding to the revenue of the country.
I would avail of this opportunity to say that a review of the statutory regulations of 1956 is called for. Far from hindering them, every effort should be made to encourage companies who are trying to export. In the case of meat factories who export sheepskins there are no restrictions with regard to the number they may export. The restrictions that I have referred to are imposing great strain on companies and I should like to take this opportunity to ask the Taoiseach to call for a review of them because they are unrealistic in present day trading conditions.
An apology is due and should be forthcoming to the company for the manner in which they have been treated, for the way in which they were intimidated and for the abusive behaviour of an official of the Department of Finance.
The first thing to be established here is that there is a restriction on the export of sheepskins from this country and that restriction is not placed there just for the fun of it or to give the officers of the Revenue Commissioners an opportunity of examining the quantities of sheepskin exported by certain people. The whole purpose of the restriction and of the licensing system is to ensure that sufficient sheepskins are retained in this country to supply the fellmongers and the tanneries who process these sheepskins for manufacture into various commodities like gloves, uppers of shoes and things like that. So that, the main purpose of this restriction is to maintain employment in this country for Irish workers. Therefore, that is the first fact to be established—the fact that the regulations are there—and as long as they exist they are bound to be obeyed by those dealing in these commodities.
The Revenue Commissioners from time to time receive information about evasion of licensing restrictions and other matters. It is not possible for them on all occasions to examine every load of these commodities and particularly of sheepskins leaving the country. They can make spot checks, maybe one in three or one in four, as the case may be. As Deputy O'Connell said, these sheepskins are often exported in containers and they are not a very agreeable commodity to handle because of the chemicals and other things used in order to preserve them. In fact, I believe they are rather objectionable in many ways. However, that does not deter the Revenue Commissioners' officers from examining them. They do, according as opportunity offers. Therefore, every load, whether it is an open load or in a container that leaves the country is not examined but spot checks are made of them and even when these checks are made it is not always possible to ensure that the amount of skins in the container or on the load conforms with the export documents concerning them.
However, in this case information was received by the Revenue Commissioners during the month of August. I take it the information was to the effect that the company concerned was exporting more sheepskins than the licences they held warranted and when the officer called on the premises a couple of days later, on 12th August, and asked for the production of the books relating to the exports, he was informed that the books were not then available, that they were with the auditors. He produced the notice of the Revenue Commissioners which requires such firms to produce the books and permits copies to be taken of them. On this occasion the officer, having seen the books on 15th August, suggested that it would be more convenient for him and permit of a more thorough inspection of them, if he were permitted to take the books with him to his own office. My information is that no objection was raised by the company to this course.
In the course of his examination the officer noticed that certain documents were missing from the books that he had in his possession and he communicated with the company and pointed out this fact to them. They made a search for them and, I think it was the next day, the firm phoned and said the documents were now available. The officer suggested that he might collect them on that day and this, too, was agreed. So, he took the documents to his office—he had already taken the books. Three days later representatives of the firm called to the office of the Revenue Commissioners' officer and demanded the return of the books. I do not know whether the officer concerned was there at the time. Deputy O'Connell says he was not, that somebody else was, and that they waited for his coming. I will accept that. But, when the officer did come and spoke to the representatives of the firm, he said he was not yet finished with the books and asked that the books be left with him for some hours in order to complete his examination. This was not agreed and the representatives of the firm insisted on taking the books with them. The officer said that he might require them to return them to him again at a later stage.
These are the facts of the transaction as I know them but, as I said in my reply to Deputy O'Connell today, the investigation was, in fact, warranted as a result of further examinations carried out by the officer concerned. He did, as Deputy O'Connell suggests, call to the firm in the North of Ireland to whom a consignment had been made but he called to no other firms who were customers of the Dublin exporters. Deputy O'Connell said that he had some other customers in the North of Ireland and some customers in Britain. The Revenue Commissioner's officer made no attempt whatever so far to contact any of these other customers. So, what happened in relation to the business of the Dublin firm with these other customers is no responsibility of the officer concerned. I want to say that the officer's integrity, or the integrity of any other officer, is not in question on this occasion. They were doing their duty according to the laws of this country. They were doing their duty as they were required to do in order to ensure, first of all, that the law was carried out and, secondly, that the purpose of the law was effected.
But their behaviour is in doubt.
In other words to maintain the due quantum of sheepskins in the country to ensure continuity of employment of our own people. There can be no question of victimisation as far as victimisation might be interpreted in this context. Not only is there no question of victimisation but the Revenue Commissioners' officers informed the Department of Industry and Commerce, who are the licensing issuing authority, that as far as this firm was concerned they did not want this investigation to prejudice them while the investigation was going on. Therefore, as far as the Revenue Commissioners were concerned, it was a matter for the Department of Industry and Commerce to issue to this firm whatever licences they were entitled to. I take it that that continued. It does not matter whether there are fewer tanners now or fewer people employed in tanneries now than when the regulations first came in. That may be explained, if it is so, by the change over to synthetic materials now used for the purposes for which sheepskins were formerly used.
Then why the restrictions——
The restrictions still——
——if synthetics are used?
To some extent, but the restrictions are still used to maintain the quantity of skins required for the purpose of the industry.
Why not have a review at regular intervals?
Of course they are reviewed at regular intervals.
They have not been reviewed since 1956.
The tanneries who benefit by these restrictions naturally make their representations to the Department; the people who have skins to export make their representations, and from my experience as Minister for Industry and Commerce I know there is always a conflict of interests in the case of a commodity like this for which high prices can be got on the export market. The Department of Industry and Commerce's main concern, however, is to ensure the amount of employment that can be given by the retention of as many skins as possible in the country will in fact be given. I do not know what kind of attitude the representatives of the firm took up when they went to the Revenue Commissioners' office or what kind of attitude the officer took up, but the facts are that the Revenue Commissioners' officer asked for the books and was given them. There was no objection raised when ultimately the firm's representatives came to the Revenue Commissioners' office and asked for the books; they were given the books back. In the meantime, the investigations are continuing and, as I said earlier, the investigations appear to have been warranted. Now, if the officer concerned transgressed his functions in any way, this firm would have their remedy; but, on the other hand, if it is established with adequate proof that skins were exported in excess of the licensing provision then a prosecution would follow. As I said earlier, the matter is under investigation and, therefore, I do not want to comment on the merits of the case any further. These are the facts as I have been given them and as I believe to be true.
The Dáil adjourned at 10.55 p.m. until 3 p.m. on Wednesday, 6th November, 1968.