Is he still speaking?
Committee on Finance. - Financial Resolution No. 4: Wholesale Tax (Resumed).
Debate resumed on the following motion:
(1) That, with effect as on and from the 1st day of January, 1969, wholesale tax imposed by section 2 of the Finance (No. 2) Act, 1966 (No. 22 of 1966), shall be charged, levied and paid at the rate of ten per cent in lieu of the rate of five per cent specified in sections 7 (1) and 11 (1) of that Act.
(2) It is hereby declared that it is expedient in the public interest that this Resolution shall have statutory effect under the provisions of the Provisional Collection of Taxes Act, 1927 (No. 7 of 1927).
— (The Taoiseach.)
Deputy Dowling rose.
There have been accusations during the debate of wasteful spending of the nation's finances. Do the Opposition consider as wasteful the provision of more money for agriculture, for social welfare benefits, for education, for the health services, for industrial expansion, for higher pay for workers in the public service? Do they consider wasteful the provision of more money for the nation's capital programme— housing, schools, forestry, fisheries and other such items? We do not. We consider this is the type of programme, the type of service, on which more money should be spent.
It is hard to understand the mentality of the people who say this is wasteful spending. We in Fianna Fáil are concerned with all sections of the community, especially those who are less well off. We are acutely aware of the efforts of the Minister for Finance to provide more money for all these sections and we know that he will continue to do so. That is our intention. If this expenditure were cut down in the manner suggested by the Opposition the economy would grind to a halt, unemployment would increase and with that the hardship of the less well off people would also increase.
As I said last night, it is difficult to understand the mentality of Fine Gael and Labour who have engaged in a betrayal of the workers and the small farmers in relation to the increases in incomes to which they are entitled and which the Government are providing in this Budget. When the Dáil came to consider these increases, both Labour and Fine Gael voted against them. They voted against providing the money to give these increases and to make them effective. Though they say these people are entitled to increases they voted against the providing of the necessary finance to make them effective. They know that the Civil Service, to which some of this money is being given, covers a wide field.
Last night, I also dealt with the various aspects of the industrial life of this country and I pointed out that in the future we must be very cautious in regard to the outlook of our political opponents who have so many times ruthlessly endeavoured to sabotage so many thriving industrial concerns. I mention Verolme. We saw on their election addresses condemnation of this dockyard in Cork which at present employs 750 people. They recklessly and untruthfully described this undertaking as one of the "silly industries." That firm, which employs 750 people, had the support of this Government. We hope the day is long gone of the reckless charges made, and the efforts which the Fine Gael Front Bench spokesmen had in mind at the time to wreck concerns such as the Verolme Dockyard, Shannon Airport and other industrial concerns which are now giving such valuable employment.
I mentioned last night, and I should like to mention it again because I have further information, the housing situation for which moneys are made available from time to time.
Might I point out to the Deputy that the housing situation does not relevantly arise on the Budget debate? The matters for debate are taxation, expenditure and financial policy. Deputies will get an early opportunity of discussing the housing situation in detail on the Estimate.
This Budget is a supplementary Budget. The main Budget dealt with the financial situation and this cannot be taken in isolation. It must be taken as part of the general picture in relation to taxation as a whole, rather than by way of fragmentation of the matter as no doubt the Opposition would wish to take it. They have dealt in a very general way with all other aspects rather than with the two or three mentioned in the Budget. For that reason I should like to say that the Minister this year made available all the factors in relation to the budgetary position. I should like to correct some erroneous statements made in relation to Government spending and in relation to the situation with regard to housing.
I cannot allow the Deputy to embark on a debate on housing. This is a supplementary Budget and the debate is even more restrictive than on an ordinary debate.
While that may be so, references which have been made, if not corrected, will create an erroneous impression in the minds of the public. I just want to correct the impression that has been conveyed by members of the Opposition in dealing with the Budget. It is only fair that we should at least have an opportunity of correcting the erroneous impression conveyed to the people.
The Chair points out that Deputies will get an early opportunity of discussing housing on the Estimate where it is relevant. It is not relevant on the Budget debate.
The position is that references have been made in the public press to the moneys made available for development through the Budget. One reference was in relation to disturbance which will take place in this city in the coming winter. It is an erroneous impression to convey that the Minister for Finance was not making enough money available to the Dublin Corporation for the housing of people. At no time has the Minister refused to make available the moneys demanded by the Dublin Corporation. The red style rallies in which the Labour Group in Dublin Corporation intend to participate during the coming winter are to be deplored. There are other matters which are threatening the security of our city and the nation and these are activities which are at the moment percolating through the city. Recently in the Ballyfermot area handbooks were given out containing quotations such as "political power grows out of the barrel of a gun." The works of Mao Tse Tung have been circulating in the Ballyfermot area and this is a copy of one. This is a situation which can have a damaging effect on the stability of the city and one to which we must give considerable thought. It affects the stability of the Government and that of the nation as a whole.
The matter would not arise in the debate on the financial motion.
Now that I have mentioned it, I shall deal with it in greater detail when we get to the Estimate for the Department of Justice or other Estimates.
The Government is ever mindful of the workers as has been displayed on this occasion in the financial provisions in the Budget. We are concerned now, just as we have been concerned in the past, with bringing in taxes to alleviate the distress of workers in workshops and elsewhere. In very recent times, of course, the other deserving sections of the community, including widows and orphans, got increases, together with other benefits such as free transport, free electricity and free radio licences, as well as a variety of other kinds of assistance. It is deplorable to see people coming into this House and voting against the Resolutions to make money available for services which are so necessary for the workers and others in this deserving section of the community.
I am proud to be a member of the Government who have measured up to their responsibility and whose Leader has the courage to place before this House the necessary Financial Resolutions to make money available for the farmers and Government workers. It is necessary now, as in the past, to provide money for the weaker sections of the community who have little enough and perhaps in the future they will get more. If it is necessary to support this and other Resolutions in order to make moneys available, I am sure that we on this side of the House will not be found wanting.
The Financial Resolutions which were introduced by the Taoiseach have a much more grave significance than many Deputies of the House appreciate. I fully realise that the Taoiseach bearing the double burden of Taoiseach and Minister for Finance at the moment cannot be expected to be permanently present in the House during this debate but I regret his absence just at the moment because, after mature reflection, I feel an obligation to say certain things which I do not care to say in his absence.
The Taoiseach will, I think, be here in a few minutes.
I will hold these observations until it is possible for him to be here. I remember that six or seven years ago in this House Senator Ryan, who was then Deputy Ryan, Minister for Finance, stating categorically that he was driven to the course of imposing the turnover tax because he had been advised by the Revenue Commissioners that traditional sources of taxation—tobacco, drink and petrol— could no longer yield any supplement to the Exchequer because they had reached the point of diminishing return and with that situation in front of him he was reluctantly forced to turn to the turnover tax which would bear on every section of the community, rich and poor, and that he recognised that its burden falls as heavily on those whose practice and whose need was that they should spend their entire weekly income in order to maintain their household in reasonable comfort. We challenged that and pointed out the manifest danger of such a tax and shortly afterwards we had a by-election in Dublin North-East and the people there condemned the tax by defeating the Government candidate and electing Deputy Paddy Belton.
I mention that particularly, Sir, today because I believe that tax was not only unjust then in its indiscriminate application to every section of the community but because I believe it is the bench mark from which the dialectic of inflation has started in this country and which is pushing us further and further down the slope to catastrophe. When I speak of inflation I speak of the horror that is undermining society not only in this country but in democracies all over the world. It sometimes terrifies me to recollect or to see the parallel between the situation in which we here in Ireland and many other countries are at this time and the story in the Scriptures of the Gadarene swine. At least there those possessed by the devil were exorcised at the expense of the swine, who were then swept down the slopes over the precipice to destruction. Here it seems —and, I admit, elsewhere—not even the humans are redeemed. There they were redeemed from their madness and restored to sanity but we all seem to join with the herd of Gadarene swine and rush towards the precipice, maddened by the cursed doctrine sold to democratic Governments by the late Lord Keynes with the theory of controlled inflation.
There is no such thing as controlled inflation. Once a democratic society embarks on the road of so-called controlled inflation and the devaluation progressively of its own currency, the process feeds upon itself and fundamentally there is no difference between the state of a nation embarked on the road of inflation and the state of a dipsomaniac head of a family who perennially spends more than he earns on the illusory enjoyment of permanent intoxication. So long as his credit holds out, he can continue to be content and happy according to his own criterion; but it is when the end comes that the difference manifests itself. To the ordinary individual when the inevitable crisis comes and his credit holds out no longer, when his income is no longer adequate, his creditors gather around him and the State has established machinery by which he can have recourse to the bankruptcy courts. Having been an independent man with a home and a family, he goes through the process of bankruptcy and emerges without an income, without a home, with all the responsibility of a family upon him. Those of us who have been a long time in the world are only too familiar with the pitiable spectacle of a middle-aged man seeking to redeem himself, and his friends seeking to find him a job, with the record of his own dissolute conduct behind him. But that cannot happen to a sovereign State. What happens to a sovereign State is something quite else and this is the thing that appals me when I listen to some Deputies in this House—I do not particularise this House—but some Deputies in this House and other democratic deliberative assemblies discussing this problem. Nobody says what the ultimate result is for a sovereign State.
First, the acute tragedy that, as our balance of payments situation deteriorates, sooner or later we arrive at the stage when imports must be controlled because we can no longer afford to pay for them. When you come to examine the imports that you can control the popular illusion is that, by stopping the extreme forms of luxury like perfumes and jewellery and things that everybody manifestly can get along without, you can redress the balance; but experience teaches that nothing could be further from the truth. If you want to make an impression on a serious adverse balance of payments situation you are ultimately forced into the control of the imports of the raw materials of your industrial processes and it is then that catastrophic unemployment falls upon you. It is then that a nation which is struggling, as this nation is struggling, to establish an enduring industrial structure in a country virtually devoid of the raw materials of industry discovers that the whole industrial structure which we seek to establish here has been put in peril from which it may never be able to survive.
It is an unprofitable occupation to be arguing that one side of the House does more than the other side of the House to promote industry in this country. It is common knowledge that, whatever Party we belong to, all would be concerned to do it. But we did establish the Industrial Development Authority of which Fianna Fáil thought very little when it was established for the purpose of promoting industry.
It is true that the late Deputy Norton, when Minister for Industry and Commerce, travelled the Continent and went to America seeking to induce people to come here and establish industries. It is true that Deputy Sweetman promoted the Industrial Grants Act. It is true that Deputy Sweetman, as Minister for Finance, evolved and introduced here in 1956 the Industrial Grants Act, which not only provided for industrial grants but the Finance Act, 1956, which provided for exemption from income tax and corporation profits tax in industries producing new exports. It is true that certain Deputies had misgivings about these plans and thought it right to pour derision on the late Deputy Norton for going to look in Germany and the US for industrialists who might be interested in establishing plants here.
It is true also that the vast majority of Deputies from all sides of the House approved of these developments and have used them since then to bring in industry. It is true that these devices have operated to make this country attractive to foregin countries so that foregin countries established industries here almost all of which are based on imported raw materials.
The Taoiseach, in introducing the new taxes in this Budget, said that the Government took credit for the fact that it did not hesitate to do things that superficially appeared unpopular in order to meet an unexpected situation. I think I am entitled to recall that, speaking here in May last year on the introduction of the Budget by Deputy Haughey, Minister for Finance —I am glad to join my colleagues in saying we wish him an early return to full health and vigour—I warned explicitly at column 442 of Volume 234 of exactly what has transpired. It is also true that Deputy Haughey, in replying at column 1175 of the same volume poured ridicule on the apprehensions I then ventured to express and rebuked me for having said on previous occasions that the country was bust. He went on to say at column 1177:
A number of Deputies inquired whether I intended to introduce a second Budget in this year or whether additional taxation is likely to be imposed, and they related that query to the warning I gave in my Budget speech to the effect that should the buoyancy of revenue not match up to what I expected, or if other requirements of sound economic management so dictated, I would bring forward proposals for additional taxation later in the year. I thought it was only fair to give that warning, but I can assure the House that I have no intention whatever of introducing a second Budget or bringing in any new taxation this year, unless such a course is found to be clearly and absolutely unavoidable.
If the Minister and the Government to which he belongs had any pretensions to know their job surely the words I have just quoted are as categoric an assurance as it was possible for a Minister to give, with all the information at his disposal, that there was no prospect of any further taxation being necessary in the coming financial year.
Yet, the Taoiseach when he came to speak had it to tell, if I read the figures he furnished to us correctly, that the Minister was approximately £17.5 million out in his calculation and that that deficit situation would leave us still with a very substantial deficit after the taxes which the Taoiseach has recommended to the House have operated for the last quarter of the year.
I am preoccupied with the whole problem of inflation and preoccupied, strangely enough, not fundamentally on economic grounds. The whole dialectic of inflation has much more grave consequences for a nation such as ours than those belonging strictly to the economic sphere. I believe they put the whole sovereign independence of the State in danger. I believe economics could bring us down and deprive us of all the things that generations of our people have fought to establish and which I see personified in the functions of this Oireachtas of which we have the honour to be Members. I believe it is right for public men to say and do unpopular things to avert the consequences of the illusion that controlled inflation is possible and desirable for the development of a nation. Economic growth has become a kind of horrible illusion. It is one of these phrases used to cover up a dishonest practice which dates back to the Chinese Empire. You can find in history down from 3000 BC, the traditional practice of countries in those days scraping bits off the coins in circulation and anyone who takes half-a-crown from his pocket today and sees on the edge of it the serrations will realise that this is a medieval survival from the days when kings reduced the value of the gold coins then in circulation by cutting fractions off their surfaces. It was their method of devaluing the currency and living on the proceeds of their theft from the public.
I heard the Taoiseach declare, in connection with his financial statement, his intention to float a national loan. I have spoken on this matter once before and there are two things I want to say in the Taoiseach's presence which I would not care to say in his absence. I know the obligation there is on all sides of the House to sustain the national credit but I also know we have obligations to the people who trust us and who believe what we say here. I want to say that the system of issuing national loans without undertaking to return the principal loaned to the Government on a basis related to the current cost of living is becoming a gigantic fraud on the poor. I have it on my conscience that I was a member of a Government from 1948 to 1951 when we were issuing 3½ per cent loans, 90 per cent of which were taken up by people who mobilised small savings in order to invest them in those loans because they wanted to support the Government of Ireland and its policy of development. Some of them took them up by personal subscription, others took them up through the Trustee Savings Bank, by investment in saving certificates or by the investment of the funds of the industrial life insurance policies that they were contributing to the insurance companies. The plain fact is that we have stolen their money because for every £ they put into those loans, today if they were repaid, if they mature in this year, as some of them did, we would give them back 10/-.
There is no experienced or wealthy investor in this country who retained £1,000 of those loans. Such people immediately unloaded them and invested their money in industrial equities, mining shares or investment trusts and all their money is safe because they understand the craft of dealing in money. It is the poor who have been robbed and they have been robbed by the processes of inflation. To me the exasperating thing is that it is terribly difficult to explain it to the very people one seeks to protect. It is no longer honest as a considered policy of this Government to permit annual inflation of three per cent or four per cent and to borrow money from the poor on the pretence they are getting back what they subscribed. If they are not being robbed we are, in fact, forcing them by a shameful Government trick to live on their capital when their neighbours who are more sophisticated are living on the income from their investments.
Therefore, I want to renew again my representation that in future national loans should be repayable in currency related to the cost of living obtaining at the date of the repayment as compared with the cost of living figure which obtained on the day of the subscription to the loans. That has been done in Finland; they found it expensive to do it and now they have tried to abandon that practice. I want to submit that practice is a practice which is honest, which it is our duty to provide for the protection of the savings of the poor who believe in their own country and are prepared to give it the practical support of lending their savings to the country rather than investing them in gold mines or diamonds or equities abroad. I want to admit quite frankly that to arrest inflation and protect the country from its ultimate appalling consequence of the restriction of imports of the raw materials of our industrial operation, everyone must be called upon to exercise restraint not only in wages but in incomes as well.
Here I have got to say something with great reluctance and I did not want to say it in the absence of the Taoiseach, but on his Vote at the end of the last session I did say that I wanted to warn him that rumours were in current circulation in the city of Dublin which called in question the integrity of the Government itself. I want to ask him now so that he will have an opportunity of answering it categorically to the House and to the country: is it true, what is popularly believed throughout the country, that members of his Government have been speculating in lands and making large personal fortunes as a result of their speculation? This question needs to be answered because I can assure him that I have been approached by bankers, architects, prominent members of the solicitors' profession and prominent members of the auctioneers' and valuers' profession and challenged as to why that fact is not ventilated in Dáil Éireann and clarified for the people at large.
It is amazing they did not come to me.
Well, I suppose that often happens. I am coming to the Taoiseach now and at considerable personal cost because whether I agree with the Taoiseach or not, he is the head of our Government and no matter how much I disagree with the Ministers constituting the Government they are the Government chosen by the people and their integrity is as precious to me as it is to the members of his own Party. Let us be clear what I am querying. I was brought up in the tradition that if you entered public life you excluded yourself voluntarily but irrevocably from certain sources of profit which were not prohibited to those who were not involved in public life. If you enter public life you accept certain responsibilities for setting standards and you must be peculiarly careful that, if you are a member of a Government, no financial transaction in which you are engaged was, in fact, or could appear to be affected by any information available to you as a result of the confidential information accruing to those who engage in the formulation of policy for the future. A classic example of this is, of course, the Marconi Scandal in Great Britain. Many people of the younger generation will not know to what I am referring. That was the occasion when members of the British Government invested money in the American Marconi Company because they knew the British Government intended to deal largely with the British Marconi Company, of which the American Company was the principal shareholder and that brought upon Lloyd George and a great Liberal Administration a cloud of scandal from which, I do not think, Liberalism in England has ever fully recovered.
I suggest that membership of a Government absolutely excludes the permissibility of individual members of that Government speculating in land at the present time, more especially should it transpire that that land becomes vastly enhanced in value as a result of developments involving it, with consequential substantial profit to individual members of the Government who are associated with it.
Now, I invite the Taoiseach in this debate to inquire into that matter and to say publicly in the House that I have presented that allegation to him and that he is in a position categorically to repudiate it and to say that no member of his Government has engaged in land transactions which have resulted in substantial personal profit to himself since he, the Taoiseach, became responsible as Leader of the Government of which he is now a member. As I said, I do not think the standard is unreasonably high and I believe any departure from it will cause grave scandal to our people and put an intolerable strain on all sections of the community called upon to make their contribution to keeping costs and prices at a competitive level in order to enable us economically to survive. I am thinking of the fact that we are asking wage earners not to press for unreasonable increases in wages.
That brings me to another aspect of that request. How can the Taoiseach come in here and urge on the House that the proposals he has brought in in these Financial Resolutions are calculated to stabilise the economic situation of the country? Does he himself realise when he doubled the wholesale tax and put substantial additional burdens on the people, the extent to which those burdens will fall on the wage earners, from whom he is asking, at the same time, for restraint? Does he himself recognise the categories of goods on which the wholesale tax falls? If a woman goes down now, a workingman's wife, to buy sheets, to buy towels, to buy dishcloths, to buy the ordinary things a woman must buy in order to keep the house as she would wish to keep it, on every single one of these items, through the wholesale tax proposed, we have doubled the tax? There is a wide range of domestic hardware utensils that the ordinary housewife has to buy if her house is to be kept neat and clean and as she would wish to keep it; on every single one she will pay this wholesale tax.
The cost-of-living figure, bearing in mind that it was, I think, 100 in 1951, is 200 today. Does the Taoiseach seriously believe that the taxes he is now proposing will not push the cost-of-living figure higher? I often think, with sympathy, of the responsibility trade union officials have trying to explain the complexity of national economics to their members and finding themselves faced with the reply: "Look, you got the 11th Round increase in wages and the new so-called mini-Budget has taken from us far the greater part of the entire increase we got." It is not an easy task to try to explain to those members that what we euphemistically describe as "withdrawing purchasing power from the economy" is necessary in order to protect the nation. They simply answer: "This simply means that I have to give up smoking" or "I have to give up the pint I took whenever I got the chance to take it" or "I will have to tell the wife to tear up her aprons and make dusters out of them because we cannot afford to buy dusters in the shop any more."
It is extremely difficult for us, sitting in this House, with the incomes we now enjoy, to understand the problem of a man bringing home £14, £15 or £16 a week and being told by his wife that the habitual weekly sum that he has given her for the household expenses no longer meets the bill and the reason there is no sugar in the sugar bowl is because, when she came to the check-out counter, or went to the shop where she usually deals, and the bill was cast up she had not the money to pay and she had to take the sugar out of the basket and put it back and, if her husband wants sugar in his tea hereafter, he will have to give her another 2/- or 3/- a week.
It makes me sometimes almost despair. First, the people will not face that fundamental fact of life that this is what this kind of device, which the Taoiseach has brought to the House, means in the daily life of ordinary people, our neighbours. The other thing that makes me almost despair is to read a sophisticated person like Deputy Haughey, the Minister for Finance, pouring derision on the comparison between the philosophies of Per Jacobssen as opposed to those of Lord Keynes and saying anyone who believed that vital to the foundation of a State's independence and integrity is the stability of its currency is out of date in his beliefs.
I do not suppose the world will be greatly shaken by the fact that Iceland is devaluing. Iceland is devaluing its currency this year because its principal export, fish, has run into a bad market. By the mercy of God's Providence our principal export, cattle, has not had the same deplorable experience. I think we may attribute that very largely to the 1948 Trade Agreement, for which I never cease to thank God. But there is a much more dramatic event in the world today to which this country might with advantage turn its attention.
I was in Strasbourg in 1964 when General de Gaulle announced that he was vetoing the proposal to admit Great Britain, Ireland, Denmark and Norway to the EEC. I remember saying in Strasbourg at that time that the day would yet come when the President of the French Republic would curse the decision he had made that day, when he had not only forbidden the unification of Europe but also rejected the offer of President Kennedy of an Atlantic partnership. I remember the French representatives in all their arrogance proclaiming that their decision was invulnerable and irrevocable. I remember the talk in the corridors when they proclaimed in their arrogance and indifference to the interests of any other nation but their own that the decision was founded on the foresight of General de Gaulle in accumulating a mountain of gold in the coffers of France. Amongst the delegates there, drawn from all over Europe, there were those who felt that this mountain of gold was like the Rock of Gibraltar and put General de Gaulle in a position in which he could challenge the whole world. He had purchased that at the price of economic policies which precipitated a degree of stress within that country which exploded six short months ago, and today that country which thought itself to be standing on a rock of stability has discovered that its own currency is in danger of devaluation.
That is one of the most dramatic events that have happened in my lifetime. Here is a great figure in the world who made the tragic mistake of staying on too long under the burden of responsibility he is no longer qualified to bear. He brought his country to these extraordinary straits. Twelve months ago any prudent financier in the world would have said: "If you want to export capital, there is one country where it is perfectly safe from the possibility of devaluation, and that is France. She has enough gold in her store to discharge all her debts tomorrow morning if all her creditors apply for recoupment of her debts." Within six short months 50 per cent of those reserves are gone and the word is abroad: "Watch the franc." Every financial rat who gathered his horde into Paris is jumping overboard. The strain on the resources of the French nation are growing and the prospects of the devaluation of the French franc are growing hourly. There is nothing he can do about it because the moment confidence sags pressure grows in geometric progression.
France might well devalue. She has done it often before. When a great country devalues many of the boys shrug their shoulders. Devaluation is a very simple thing. It is the same as a bookie welshing. Everyone despises a poor bookie who runs out of cash, runs away, and does not pay his debts. A country that devalues simply does not pay its debts. It welshes on its creditors. If it is big enough and strong enough people just shrug their shoulders and say: "There you are," and pass on.
I do not think there is any immediate danger of this country having to devalue its currency. If I did I would think long and well before I thought it right to mention it publicly in this House. We still have substantial resources abroad. The Taoiseach has spoken of the possibility—and I think he is perfectly right—of a deficit in the balance of payments in 1969 and 1970 of £50 million sterling. I think our external assets in the banking system will amount to approximately £280 million or £290 million at the end of this year. Would Deputies reflect on the impact of a deficit of payments at the rate of £50 million per annum on such reserves, and when they are reflecting would they look at France? It is not a deficit in its balance of payments that is bringing France to its knees. It is the boys who have begun to smell the wind and to pull money out of France.
Suppose we found ourselves on that slippery slope and found our precipitation down that slope hastened by the cute boys who proceeded to pull money out of the country. Our balance of payments which is now substantially sustained by imports of capital might find itself gravely embarrassed by exports of capital and an adverse balance of payments of £50 million could very quickly become £60 million or £70 million and such figures could start panic withdrawals. When I hear some of the less sophisticated Deputies of the Fianna Fáil Party talking I am appalled by the fact that they do not understand what that means. I remember the imposition of levies in 1956. Do not imagine that Deputy William Norton or Deputy Brendan Corish or I liked the levies. They were put on to stop the import of luxuries and were carefully selected so that there would be no danger of the necessity arising of controlling the import of raw materials, because we foresaw that, if we allowed a situation to develop which imposed on us the necessity of controlling physically the import of raw materials, it was not only a diminution in the quantity of raw materials that would come in. It would also cause a disruption of industry in seeking from the Department of Industry and Commerce the licence to bring in their portion of the controlled quantity of raw material that they had to bring in and they would be involved in stoppages of production for weeks because the Department of Industry and Commerce needed the time to work out what percentage of the total quantity of that raw material any particular factory was entitled to get. We put on the levies because we felt we must do without oranges, we must do without perfume, we must do without jewellery and without certain expensive articles of clothing until this balance of payments problem was resolved.
Our attitude in this House was: "Listen, do not pay the levy. Simply drop the consumption of these goods, even if it is a hardship and an inconvenience. We know it is easier to get children to take vitamins through oranges than through vitamin pills or vitamin drinks. We know they will complain because their comics are costing more and they cannot afford to buy them. We have put a levy on comics because we felt that everything that was not essential must be stopped so that the Government is not required to interfere with the free flow of raw materials into industry on which men's employment depends." Why did the Government not do that in this case? Why did they not control, if it is necessary to control, the import of inessential luxuries and ask us all to lend a hand to overcome the balance of payments problem and say to the public: "We do not want you to pay these levies. There is no use saying these levies are going to raise your cost of living because they are levied on those items without which you can easily carry on. The sacrifice we are asking of you is to do without these luxuries until this critical period has passed" instead of putting a tax on sheets, a tax on household hardware, a tax on tobacco and on beer and spirits, all of which are things that the wage earner has to pay for. Remember, that as certainly as we are on this floor the net result of the device employed by the Government is that unanimous demands will be advanced, which the Members of this House are in a very poor moral position to resist, for further increases in wages and salaries.
The whole success of our industrial export programme has been founded on the fact that we are competitive. We are competitive in an extremely difficult world market by the fact that the working people of this country are giving good value for the wages they receive. If we continue to erode those wages the working people of this country are going to ask for more and more wages until we reach the point that we are no longer competitive in the foreign markets of the world. Fortunately, we have the vast resources of our livestock exports to fall back on. We could easily reach the stage at which increasing costs will make us uncompetitive in markets which are being progressively furnished by more and more automated industries on the continent and in the United States of America. We are fighting machines with our bare hands. The plain fact is that in Ireland we do not know what automation means. The plain fact is that we happen to be living beside Great Britain which is only beginning to learn what automation means. We are between the United States of America and the Continent of Europe where automation is dominant in a large part of the wage bill of every industry exporting goods.
We are living in an economic unit —the Republic of Ireland—which is too small to permit of the economic automation of almost any industrial process we have got. In that connection—and I do not know whether it will be popular or unpopular—I want to say I recall we are living in the Republic of Ireland. I think it is no impertinence on the part of the Taoiseach of this country to say bluntly that the root of the trouble in the Six Counties of our country is Partition. I hope the day will never dawn when it is not the unanimous view of every Deputy in this House that, sooner or later under God's Providence, that monstrous injustice done to this country by a British Parliament with British votes unsustained by any Irish vote, orange or green, will be undone.
I believe the Minister for Finance, too, recognised the difficulty of the maintenance of the currency stability. I wish to say to the Taoiseach that it is a mistake to imagine that the stability of any economy can be restored in an endless spiral of increased taxes, increased wages with corresponding increased taxes which bring increased demands for higher wages. I wish to say to him also that it makes nonsense of appeals for restraint to members of trade unions unless those in responsible positions accept the obligations of public life which are those of giving example themselves, not only of restraint but of unimpeachability.
This never was more true than at the present time. Those who have the privilege of serving in the Irish Government must be men, not only of integrity but must be so seen to be nothing less.
One last matter to which I wish to refer — it is not a major detail but reference has been made to it in the course of the Taoiseach's statement and I believe it is a matter which is at the root of the stability of our society at the present time. When we were in office we bought the land where Belfield now stands. Perhaps we acted to some degree extra legally. We did this in anticipation of the vast expansion of higher education which is now happily under way. With regard to the whole university life of this country there is an atmosphere of ambiguity and bewilderment which has long been allowed to continue. I think it is true to say that the normal functions of the two universities in Dublin are to a large extent in a state of suspension because no one has time to do anything but swop theories as to what will happen as a result of the merger. We have now reached a stage where perfectly decent and orderly students are organising teach-ins to try to tell themselves what on earth is going on.
I do not minimise the problems that the Taoiseach and his Government have to grapple with in that context but I do want to say that it is necessary to restore to public order university education in this country.
In the last analysis, I turn to what I said at the beginning. Grave, as I said, the economic consequences of this Budget are to the country, I am more concerned with the consequences to the stability of the political sovereignty we enjoy. There are so many young people in this House now, in comparison with myself, who have never known what it was like not to be free that they cannot conceive of a situation in which they do not enjoy political freedom. I know that inflation is the ground on which the forces of disruption hope to stand. It is the departure point from which they hope to facilitate anarchy in a stable free society in the belief that out of that anarchy the people will turn to anyone and they do not care whether it is a minority on the left or on the right who offer them proposals of restoration of order provided they are allowed to take over. I am shocked, sometimes, when the privileges of parliament are abused. I recoil with horror from continued sources of public grievance because I recognise not only in this country, but all over the world the technique of those who hate freedom and how easy it is for them to exploit decent people who really have a sense of grievance to take to the streets where the disruptionists get behind them and where decent people are misled into the belief that demonstrations in the streets are the only way to have their grievances rectified.
With the disruptionists behind them they resort to methods which bring them into conflict with the forces of law and order, representatives of the State wearing the State uniform, the Garda Síochána, throwing on the representatives of the constitutional Government the obligation of restraining them. There is only one remedy against that and that is promptly to remedy the legitimate grievances so that those who hate freedom will not have the opportunity to promote mob law, which leads through anarchy to dictatorship Nazi or Communist; they are all the same. There is no difference between Brezhnev, Stalin and Hitler. Those are of the same pattern and after the same thing, that is, to establish that individuals were created for the State and not the State for individuals. We stand for a different philosophy and the only way we can defend it is to establish through the procedures of parliament effective remedies for genuine grievances.
I do not think the kind of road we are travelling in this Budget gives that conviction. I think this Budget smells of indecision, vacillation and failure honestly to take the Dáil into the Government's confidence. I find it hard to believe that Deputy Haughey, supported by the incomparable public servants that we have — whether public servants of the Department of Finance, of the Revenue Commissioners or elsewhere — can have fallen into an honest error of estimation of over £20 million.
No, about £15 million or £16 million.
I find it hard to believe.
The Deputy must recognise that the public service salary increases were not taken into account.
I suppose there are explanations. I hope there are. I hope he honestly brought the facts before the House, as he saw them. Then I invite him to re-read the speech I made in the course of the discussion on that Budget. He will discover that my prognostications, uninformed as they must necessarily be from a Member of the Opposition, have proved very accurate.
I want to warn the Taoiseach that inflation could destroy us and rob us of the freedom we have got: I do not care very much whether we lose that freedom to dictators to the Right or to the Left or whether we sell it for cash to Zurich or to Washington. I love America but I love her as a foreign country. I want her as no domestic ruler in Ireland. It is from this Chamber that I want to see Ireland governed — not by the licence of any foreign power, political or financial — and I want to see that Government extended, in God's good time, in justice, in charity, to the 32 Counties of Ireland which belong to the Irish people. I appreciate that the economic policies at present being pursued by the Government put those hopes in jeopardy.
I am terrified that the integrity of any Minister of an Irish Government should be called in question. It is for that reason that I have offered the Taoiseach the opportunity of categorically dealing with the question I have asked him — are they speculating in land: are they making money out of it for themselves? For, if they are, they are dragging the good name of Ireland through the dirt.
Seldom have such serious allegations been made against the integrity of Ministers of this House since its establishment as those made by Deputy Dillon in the latter part of his main statement of his speech here this morning. Usually, I have a great respect for Deputy Dillon, a great respect for his national record as a public representative and for his integrity. However, I am constrained to refer to these statements and to say that I disagree entirely with the terms in which he couched them. Deputy Dillon came along to the House and, with the Leader of the Government in attendance, charged that Ministers were guilty of fraud, dishonesty and, to put it very mildly, grossly lacking in integrity. Now, if such statements are true, Deputy Dillon or any other Deputy will be quite in order and obliged to bring it before this House— even though we all appreciate that we have the safeguard of privilege in making charges here and particularly in bringing it before the Leader of the Government.
During my public life, either in this House or on local bodies, I dislike general charges made in a general way. I cannot for one moment assume that all the members of the Government — and there are very few Members of this House who have been so critical of their activities and in my opinion rightly so, as I have been myself — are engaged in land speculation, are engaged in making fortunes through the information accruing to them by virtue of their posts as members of the Government. If that is so and if Deputy Dillon has knowledge that one, two, three or more members of the Government are engaged in such practices, I believe there is an obligation on a Deputy making a charge to be specific. I think it is very unfair to the members of the Government, whether all or most of them, and I definitely say most of them, without any doubt, to have this reflection cast upon their integrity. We must appreciate——
Knowing that it will be several days before I can reply. I do not want defence——
I am not defending the Government.
I do not want defence but I admire Deputy Murphy's approach. If there are charges they should be specific.
I am making this statement as an Opposition Deputy. The Government are well able to look after themselves. The matter is so serious that, as I mentioned a while ago, one must refer to it. As Deputy Dillon mentioned in the course of his statement the Government or any Government that have been in office here since the foundation of the State are or have been in office by virtue of the votes of the people. Whether we like them or dislike them, that is the position. The question of general integrity, in such a way as it has been questioned here this morning, is a grievous reflection on the Government, on this House and on our Irish State in general.
In actual fact I cannot overemphasise the reflection that has been cast — and I do not want to labour this point. However, I say, as a Deputy, that I disagree with charges so grave being couched in such general terms. I would say that members of the Government are generally people of integrity and Members of this House. We disagree in political matters, we disagree in many matters, but, generally speaking, the standard of integrity here is, to say the least of it, reasonably high. I think it is unfair that any person in this country holding such a high office as a member of the Government should be going around this evening and tomorrow — when this allegation will be so well publicised in our press and radio — under the cloud that he engaged in nefarious practices and that he may be guilty of dishonesty and fraud and abusing the functions vested in him as a Minister of State.
I shall conclude by saying that it is quite right and quite justifiable for any Member of this House to lay a charge against the Taoiseach or members of the Government, but I believe, in fairness to the Members who are free of such charges, that once you take the obligation on yourself of bringing the charge before the House it also imposes an additional obligation of naming the Member and stating that it is the Minister for Such-and-such. That is my view on that, Sir.
On this question of making general charges against a large group of people although only one or two or a small percentage may be guilty of such a charge, I am not questioning Deputy Dillon's integrity. There are very few Members of this House who have more respect for Deputy Dillon than I have, but I believe the terms in which he made this serious charge against Government Members were unfair and unreasonable, and that there was an obligation on him to be much more specific than he was. When I say "much more specific" I mean: name the Minister. If he was unable to do so he should not have mentioned the matter at all.
Last week I had an opportunity of dealing with a number of the matters raised in the Taoiseach's Budget statement when I spoke on the vote of confidence, so I do not want to advert to such matters today. What is wrong with the Government's planning office? Is it the members of the Government that are wrong or is it the advice they are getting from their senior officers that is wrong? I do not want to go back over statements made last week about the lack of foresight on the part of the Government and the wanton waste of time in regard to the referendum. However, we are here today discussing a mini-Budget. We all know that the introduction of a mini-Budget is an undesirable practice; it is an unusual practice.
How is it that last April, when the main Budget was introduced, the Government was unable to foresee that additional moneys to the tune of £19 million would be required for the financial year? One of the Fianna Fáil Members, Deputy O'Leary asked: how could they foresee that salaries would be increased to the extent they were increased. How could they foresee that the cows would give as much milk as they did give? And how could they foresee harvesting conditions would be so favourable and that the wheat yield would increase accordingly?
I do not know whether those are the reasons the Government themselves would give. However, to run a business, not to mind run a country, one must have some foresight. Any group of directors or even an individual businessman must plan for the year ahead and try to foresee what is likely to happen. He must try to foresee market fluctuations, changes in remuneration of employees, or in other conditions. In making up his annual budget, he must take all such matters into account. How is it that the Government were unable to foresee these changes? Or did they foresee them and deliberately hold over imposing these taxes in the main Budget seeing that the referendum was just around the corner and that by imposing additional taxation at that time they would hinder their prospects of securing a favourable verdict in their bid to change the electoral system?
I am glad the Taoiseach, Deputy Lynch, is here in the House. There are several high-sounding statements in his speech. It is no use telling us that the economy is gathering speed too quickly at present and that if the brake is not applied we will run into trouble in 1969. This kind of statement is embodied in the Taoiseach's speech, and we have had such statements from other Members of the House, both on the Government side and on the Opposition side, in the course of their contributions.
What I want to refer to mainly in my statement this morning is the income tax system. It is outrageous that a single man without dependants earning the small sum of £10 a week — which is as much as many of our single men and women are earning today, even in public employment: such employees as road workers, hospital attendants, forestry workers and so on — should be obliged by the State to return £1 by way of income tax. I asked the Minister for Finance, Deputy Haughey — and I share Deputy Dillon's hope that he will be back with us full of health and vigour in the not too distant future — a question on this matter in the House. The Minister told me — and I have no doubt, rightly — that increasing personal allowances would impose a great strain on the general revenue. But surely there must be some demarcation line? We must differentiate between those of us who are fortunate enough to enjoy what could be termed a large income and those of us who have to make do with smaller incomes.
I know the Taoiseach is just as well aware of this position as I am and that he is just as sympathetic towards rectifying it as I am. However, I know his difficulties. He will say we cannot make fish of one and flesh of another; but seeing that we cannot do it any other way, I believe we must make fish of one and flesh of another. My proposal is that people in the lower income groups should not have to pay any income tax, and even married people with what could be termed low incomes, having regard to their commitments, should be exempted also. I realise the acceptance of this proposal would mean raising the money from alternative sources.
Let us take the position of the young man and young girl in their twenties. They get a job in which they earn £10 or £12 a week, or even more, in a place away from their homes. They get no lodging allowance, and even if they have to travel long distances to and from their employment they get no travel allowance whatsoever. The State imposes the standard rate of 7s in the pound or 5s 3d in the pound, as the case may be, on their income in excess of £6 5s. Whether it is at the 5s 3d rate or the 7s rate, it all measures up to the same thing.
Many young men are anxious to save money with a view to building their own homes. That is a most desirable object, particularly for workers. Such private building will free the local authority from the obligation to provide houses for them. Such young people like to save money and the usual form of saving is through the Post Office Savings Bank. I am pleased to note that in this Budget the rate of interest has been increased, even though the increase is a mere ½ per cent. It is a step in the right direction.
I am asking the Taoiseach, in consultation with his Minister for Finance and senior advisers, to devise a method to obviate the necessity to pay income tax for people in the low income group. Liability to income tax in their case is a source of grave dissatisfaction. I know that the Taoiseach is finding in discussions with individuals that that dissatisfaction exists in Cork. Every Deputy is finding that that dissatisfaction exists. The £6 tax free allowance was established some years ago when it was worth much more than £6 is worth today. I do not want to delay on that point. Possibly, I would not have made any contribution to this debate on the Budget, having spoken on the motion of confidence last week, but for the fact that I wish to avail of the opportunity to impress upon the Government the desirability of freeing the small wage earners to whom I have referred from liability to income tax. Alternative schemes for providing revenue must have the support of Deputies from all sides of the House.
It has become the practice to increase taxation on the old reliables, beer and tobacco, in order to secure additional revenue that may be required. I mentioned in the House some weeks ago the position that would arise were the general public to comply with the exhortations of the Government to save their money and not to spend money on unnecessary items. I assume that beer, tobacco, cigarettes, and so on, come within that category. This country is leaning heavily on the man who takes a drink and on the man who smokes a pipe or cigarettes, on the petrol consumer and the man who pays income tax and turnover tax. These are our main sources of revenue. The question has been asked, are we unfair to the person who drinks and smokes? Is it true to say that drinking and smoking are luxuries that we can do without? In my opinion, they are not luxuries. Take the case of a man in rural Ireland who in the course of his day's work or having concluded his day's work smokes a pipe or a cigarette. What other comfort has he?
He should not drink during the day.
I shall be dealing with drinking later. What other comfort has he than to smoke a pipe? Smoking is an Irish tradition which helps to relieve tension. A man working in the field or the Parliamentary Secretary at his desk might get rather fed up. A smoke may relieve him and he may be able to continue his work refreshed.
This is not sales talk, or anything, is it?
We hear a great deal about the disadvantages of cigarette smoking. I am not an authority on this subject but it is my personal opinion that there are advantages. It is not my intention to argue as to whether or not the advantages outweigh the disadvantages. What is wrong with a few drinks?
Devil a bit.
There is no use talking about drink being unnecessary. We know that people who abuse drink and take too much cause hardship, in many cases to their families, and so on, but we cannot generalise about the disadvantages of drinking just because it is disadvantageous in the case of a small percentage of drinkers. Drink is traditional in Ireland.
Father Mathew would turn in his grave.
When farmers want to discuss their business it is usually better to meet inside a publichouse than on the street corner. The atmosphere is more pleasant and more friendly. These people should not be imposed upon unduly. In many parts of Ireland publichouses are the only places where people can gather socially to have a few drinks, to discuss problems, to exchange views on current matters and, as a result of such discussion, improve their standards. I am not at all in favour of leaning so heavily on these people in budgetary proposals. They are contributing very considerably to the Exchequer and there is a danger of diminishing returns. Seeing that the Parliamentary Secretary is smiling, let us again ask the question, what would happen if the admonition contained in page 5 of the Financial Statement were accepted and rigidly adhered to by the people? I refer to the statement:
Spending on consumption has to be curbed and personal saving encouraged.
That would create a revolution. The State would have to look elsewhere for revenue. The publicans, hoteliers and their assistants, who derive most of their income from drink, would be thrown out of business. The people employed by distilleries, breweries, and so on, would be thrown out of employment. If one is to speak realistically, it must be said that the consumption of drink and tobacco creates a great deal of employment.
I understand that the tax on a pint is 1/3d. I know that the tax on loose tobacco has been moved up to about 4/6d and that the tax on pressed tobacco is 3/6d an ounce. Last August we gave the old age pensioners 7/6d a week and one can imagine on a Friday an old age pensioner going to the post office to collect his pension, buying a plug of tobacco and having a half one. It takes a sizeable percentage out of his pension. Many old people have no other comfort and, possibly at the expense of other items, they take a few small ones and a smoke and in that way they return to the Exchequer half of their pensions through indirect taxation. When will it stop? If we require £15 million extra next April will we say to the smoker: "You must do without it. You are one type of person we have no sympathy for. Give up smoking and you will live longer — there will be no danger of cancer or heart trouble"? Will we say to the drinker: "Keep away from the publicans. You will be a lot better off to stay at home"?
Cork has reared another apostle of temperance.
I am a believer in temperance but I see nothing wrong in a man having a few drinks. I judge matters for myself. I see nothing wrong in a man taking drink in moderation. I object to any one taking a drink and driving a car to the danger of the public. I am not my brother's keeper and I do not say that the Parliamentary Secretary should not take a drink if he feels like it. However, this Budget emphasises the unfair imposition on the man who takes a drink or consumes tobacco and I advise the Government not to proceed further on this line. Judging from Deputy Haughey's statement when he introduced the major Budget last April, tobacco and drink have become sources of diminishing returns in this respect. One must, therefore, wonder whether the major Budget was geared towards the forthcoming referendum and whether, after the referendum, the Government were not too thankful and decided to let the people have it.
As you said earlier, Sir, the debate on this Budget is limited but I do not think it is so limited that it will debar me from referring to one difficulty to which I have referred time and time again — the difference between Government Departments and the lack of liaison or of co-operation between them. Each Minister goes about managing or mismanaging his own Department as if it were the only one. I think that system is bad and I am very pleased that the Minister for Social Welfare is in the House because I believe it rests more on him possibly than any other Minister to try to co-ordinate the efforts of certain Departments. When I say "certain Departments" I have in mind those who provide employment such as the Department of Lands, Finance — by way of harbour schemes and so on — and Local Government through the various schemes they administer. As well as having co-ordination between Departments which give employment in this way, we should also have a better understanding with local authorities who engage in the same type of work.
I fear it does not happen to be relevant to the debate.
I prefaced my remarks by referring to your earlier reference about relevancy——
The Deputy has managed neatly.
——but I can finish with it in two sentences. Indeed, the matter is relevant because we pay out a lot of money in social welfare benefits and much of the money could be expended in giving useful employment. For instance, if eight men are laid off by the Department of Lands, why should they be forced, if the Department have no further employment for them, to go along to the labour exchange and draw unemployment benefit? Would it not be better if, say, the Department of Lands notified the Department of Local Government: "Eight men who were employed by us have become redundant in area so and so? Could you accommodate them in that district?" In that way they would not have to be paid unemployment benefit which carries with it the demand that instead of engaging in useful employment they go to the labour exchange or the Garda station to sign on.
The Deputy should not proceed further on that matter.
I will not labour it further. I was availing of the presence in the House of the Minister for Social Welfare.
Will the Deputy support me in a scheme of that kind?
Look up the records. I have spoken about it here. I was told by a member of the Minister's Party that I would not say it at the church gates in Cork — that I would be afraid to say it in case it might interfere with my chances in the election. I have said it umpteen times in Cork and I would say it now in greater detail but the Ceann Comhairle might——
He might put you off your track.
——intervene. Those of us who are not qualified to deal with financial matters listen to and read the advice given by senior Departmental officials who are supposed to be so qualified. We learn about programmes and we had the first Programme for Economic Expansion which stated that it would advance us enormously, that it would create new jobs. Then we had a Second Programme which stated that there would be a 4½ per cent increase in our gross national product and that our trade gap would be closed.
There is a great deal of bunkum attached to these programmes. They have not been realised, and just prior to the Minister's illness, he told us he was bringing in a Third Programme for Economic Expansion. I have been expressing this view for years, and expressing it as one who makes it clear that he is not by any means an expert in that particular field. I wonder is the advice we are getting from those who are supposed to know all about it sound? I doubt it. The results do not indicate that it is sound. They talk about extra jobs and what this scheme would do if it were adopted. With the advantage of hindsight we can see that the anticipation of these people when they drew up these booklets and made such statements has not been proved.
We raise a loan annually. This year the amount is £25,000 and the cost of servicing the loan in this country with such a relatively small population is enormously high. Granted, a sizeable percentage of the interest paid on such loans finds its way back to the Exchequer through the channels of income tax or sur-tax, but at the same time the net amount paid by way of interest is a sizeable figure. When loans are floated we have three speeches, one from the Minister, one from the Leader of the Labour Party and one from the Leader of the Fine Gael Party, all approving of the loan and asking the public to subscribe. The question arises whether we are utilising these loans to the best advantage. Is there any danger that we are sinking the future of our country in any way? I am quite in agreement with the maxim, with regard to the provision of electricity, water supplies and housing, that it is quite reasonable to ask the people to contribute towards the capital cost of such schemes. I agree with such a principle but, at the same time, are we going too far? Are we utilising all this money for the purpose for which we get it? Is any of it being used, or are we sure any of it is not used, by way of current expenditure? Mark you, the Government must address themselves to this question. We are borrowing money at high rates and our total national debt is a significant figure at the present time. I forget the amount, even though I read something about it during the week in the abstract of accounts. I think we should have more control over the expenditure of this money. I do not want to refer again to a matter which I have already mentioned. That is that we should get more information on expenditure by State-sponsored organisations. I shall refer further to that question.
We must bear in mind as Members of this House, privileged to be elected from our different constituencies, that there is an obligation on us to ensure that all the money got in through these substantial loans from the savings of our people are gainfully utilised and to the best advantage possible. With the scanty information that is forthcoming from Ministers in this House on various Estimates, it is difficult for ordinary Deputies like me to assess whether we are utilising that money to the best advantage. Debts are creeping up. The service charges for these loans year after year are increasing. That money must be found and, as I said earlier, it must be found from a very limited population.
I do not propose to deal with other matters and I should like to close my statement on the same note on which I opened it. We must review the taxation code. We cannot any longer hold out against the legitimate demands of the people in the lower and middle income group who are overburdened with taxation by way of income tax levy. In furtherance of the demands of such people we must yield to some extent. Their demands are justifiable. There is no justification for taxing a young man who is laying down through deposits, if he can afford to save anything, the foundation for a house to the extent of £1 if he earns £10. If he is a married man who earns £16 or £17 we have the same position. We must review that. I conclude my statement this morning by emphasising to the Taoiseach, the Minister for Social Welfare and the Minister for Local Government the desirability of reviewing this tax code. I am sure that, even though money must be got from alternative sources, if they do as I say they cannot all but be forced to the one conclusion: that the present system is unfair. If reviewed objectively there is no course open but to revise it so that there will be relief of hardship on the groups to whom I have referred here today.
I want to speak briefly in this debate having listened to the proposals on what has become popularly known as the mini-Budget. Sometimes after 16 or 18 years in this House one comes to the conclusion that Deputies have either not yet grasped the all-important question of ordinary domestic housekeeping in its application to running a country or else they merely get up and talk about something they do not believe in and try to score points off one another in regard to matters which, in the last analysis, every single Deputy must know are essential and absolutely necessary. It reminds me of the years I spent as a member of a local authority in the county council. All through the year members of the council put down motions every day looking for water schemes, further hospitalisation, sewerage schemes, more houses, better roads, new roads and a million things they wanted for the different areas. Having talked eloquently about them, then the county manager had to get up on his feet and point out that this would cost £50,000, £80,000, and so on, which was not provided for. Then every man was on his feet talking about rising costs. All round the year they wanted everything but they did not want to pay for it when the day of reckoning came. It is elementary, ordinary public affairs that, if we are to have the things we want and desire, then we must pay for them. It is as simple as that.
There may be accusations made, as a previous speaker has made, that the money could be used better for other things but I suppose one will never get unanimity in this House or amongst the public on that score as long as you have sectional interests. The people who are interested in rural schemes will think that the towns and cities are getting more than they should get. When one is in Dublin the people think that the Gaeltacht is getting all the money. When I am in the Gaeltacht they think they are getting nothing, that it is all going to the cities and the towns. These sectional interests intrude into this House.
If there is to be any honesty and reality in the discussion of this whole problem, people must look upon the Government as a group who are genuinely concerned with doing what any business firm or, indeed, any domestic householder must do; that is to run the business or the household in accordance with their income and, if it is necessary to do things better and bigger, then they must resort to the prudent use of borrowing. This can be dangerous if not properly applied. If we were to provide all the things that Deputies complain we have not got, we would need to bring in two or three Budgets every year and provide more and more taxes to meet all the things that are essential according to some speakers in the House.
We have in this country what is, perhaps, a welcome problem, but nevertheless it is a problem arising from an expanding economy. An expanding economy creates the inevitable demand for better standards, for more amenities, for doing everything better in every way and, at the same time, creates the problem on the social side of how to bring up the weaker sections in line with those who are enjoying the improved standards an expanding economy inevitably brings. That is the problem in which we find ourselves now. The rising cost of living is something you hear on every person's lips when it comes to making a case for better salaries and wages and better benefits under the social welfare code. If we look back we find that the only time the cost of living index was dropping was during the most catastrophic years in the whole history of the country. At no time are things so bad as when the cost of living is falling. This we witnessed in the early 30s. If you look back at the history of the economy of this country you will find that that was the only time when the cost of living index was dropping. These were the years when there was little available to anybody, when the masses of the population had to do with little, when our people had to emigrate — and at that time it was permanent emigration. It was not emigration to England then because there was little there for them. It was mostly emigration to America where they settled down permanently and did not in most case return.
A rising cost of living is inevitable where the economy is expanding, and we are experiencing that problem now. Without resorting to statistics or quoting figures in respect of the price of this and that in one year as compared with another, one has only to do an empirical examination of our economy today. It is not an unusual experience to go into any catering establishment or recreation establishment, to a race meeting or to any gathering from one end of the country to the other and hear people say: "Where is all the money coming from?" Never in any country were there such signs of luxury living and people improving their standards as are evident in this country today, and I defy contradiction on that. However, this brings with it very definite problems. There are those who may not be able to take part in the race for better living. There are those who feel they are being left behind, perhaps due to no fault of their own. There are sections who believe they are not being brought up equally with others. It is up to the Government to ensure, both socially and economically, that there is equality as far as it is possible and that a fair deal is given to everybody.
It is a lovely thing to work out a series of aspirations and call it a policy, especially if you are not in Government and faced with the task of implementing it. It is beautiful to take out a pencil and in five minutes write down on a small sheet of paper what your policy is — to improve the lot of the weaker sections, to improve the economy of the country, to expand imports, to establish more industries, to give the farmers a fair deal and so on. It is a lovely litany of pious hopes and aspirations, but to implement it and to get down to the actual work of putting it into effect is another day's work. This is the difference between the Government's policy and what may pass as the policy of any other Party in this House. The public will be aware of this by now. While at times some people may be misled, the vast majority of our people understand what is involved and appreciate the many difficulties which any Government must face.
When we introduced the Budget last spring it was a fair assessment of what we could honestly expect to be the funds at the disposal of the Minister for Finance covering every possible contingency. But, as he himself said, that was without making provision for all the unforeseen charges which could arise during the year. These have very definitely arisen and nobody has honestly attempted with any logic to assert that the Minister could reasonably be expected to anticipate those charges. If by some prodigious anticipation he did make provision for these things, he would be accused of making provision for something that had not yet happened and of creating unnecessary expectations in various sectors of the economy where increases would be sought. I would be glad if it were not necessary to have this Budget. I am sure every member of the Government would be delighted if it were not necessary to have this Budget.
In the see-saw life of a public representative, in the rough and tumble of facing the electorate and explaining situations year after year from that side of the House or this side of the House — and we shuttled over and back quite a few times — we must have gained a good deal of experience that can be logically analysed and used for the purpose of being realistic when these problems arise. Otherwise, we would have learned nothing. There is the simple exercise of making known to the people at every opportunity that, if extra benefits are to be obtained in any direction, it is the people who must pay for them. This brings about the problem of taking from those capable of paying and giving for the general benefit or the benefit of sections that would be otherwise unable to share the fruits of an expanding economy. It is as simple as that.
The Labour Party talk about an extreme socialist programme and policy. That might be a great thing but are the public not entitled to know what it will cost? It is easy to say what one can do, nationalise this, that and the other, and describe all the benefits that could accrue, but the people are entitled to know what this will cost in relation to present taxation on all sources. These are the fundamentals of policymaking. When we brought out the different Programmes for Economic Expansion for the first time in this country we at least pinpointed the direction in which we hoped to move. If economic circumstances interfered to prevent movement in that direction or movement as far as might be indicated towards these targets, that did not in any way condemn the very useful exercise of publishing programmes of expansion and setting out to the people, inside and outside the State, the lines on which we hoped to move and the targets we hoped to achieve.
This is spelling out the future line of progress in the only way possible, always taking into account that nobody can accurately, to a point, chart the future progress of any economy. Many things occur to create setbacks. The sensitivity of foreign markets to the various chill economic blasts regarding currencies and one hundred and one other things may interfere and upset the best laid schemes. It is, nevertheless, essential to have them and follow them and, as far as possible, to chart the course ahead. That is a very useful exercise and one which we must adhere to irrespective of how much we may be put out at any time. Indeed, some of the targets of the First Programme were exceeded; some were not quite reached, but, on the whole, it was a very useful exercise for those who had an investment in the country, for those concerned in business, in industry. It is even important for the family man to know what the future may hold and where we are going. These programmes served such a purpose and no matter how much we are criticised, any Government that exists here will — and I think should — continue that practice. Unforeseen difficulties arising time and again should not deter them from the course they wish to take. Indeed, the test of any Government is its ability to rise above temporary setbacks which are occasionally inevitable. If there is one thing more than anything else which Fianna Fáil can claim it is that in its past it has faced many crucial tests and many difficult times and faced them courageously and has overcome them.
The Budget we are discussing, to any casual observer, is really an exercise to ensure, as the Taoiseach said, that we continue on the rails and maintain the progress we have already shown. A growth rate of 4½ per cent in the past year is no small achievement. These are the important things. The red lights that flash here and there cannot be ignored. To do so is merely putting your head in the sand and that is one thing we have never done. It would merely build up trouble for the future. That is what we are avoiding now and, while our motives are being questioned by the Opposition, in their hearts they must know that, in order to meet the commitments that were unforeseen when the annual Budget was being prepared, the present Budget is essential.
The previous speaker said that cigarettes and drink and such things were once considered luxuries but are no longer so regarded but have become part of our social life. That is true, but there are priorities and it is much better to have a loaf of bread in the house than a bottle of stout—however well the two would go together. While these things may have been regarded in the past as luxuries — tobacco, cigarettes, beer and spirits — they are now things which most people enjoy in order to gain the relaxation which, I think, nobody begrudges. However, there are priorities and, no matter how much we hate to see the prices increasing, these things are not essential and it is only those who have money to spare who will indulge in them to any great extent. Those who have no money to spare may at least avoid the extra expenditure that would be involved.
I remember when I first went into business cigarettes were sold at 6d for 10 in the case of popular brands and you could get five Woodbines for 2d. In those days there were more Woodbines sold than anything else. Nowadays a shopkeeper would hardly know what a 2d packet of Woodbines was. The price has gone up practically every year since and the demand and the consumption has increased proportionately and, I predict, will continue to increase in all these. That is not to say that any Government, least of all the present Government, just wants to tax them out of existence. We want to get revenue and it is the least hurtful way of getting it. If we are to transfer some of the surplus money being spent on these things in order to give incomes to people who need them, and where it is justified, then we must resort to the least painful means of extraction. That is simply what any Government have to do at any time if they are to pursue any programme of expansion, particularly in an expanding economy.
As I said, an expanding economy creates problems and any Government of today is faced with doing things which the people were not expecting or, indeed, thinking about 30 years ago. This is good. The demand for domestic amenities such as the installation of water, electric light and sewerage schemes and all the other amenities throughout rural Ireland have come as an explosion. There is no question about it that this is a sign of improved standards and of an expanding economy. If the people demand these things and regard them as essential — and it is not too soon that we should have people demanding them because for too long were they without them — then the simple answer is that you must pay for them.
I remember a few years ago when I was in the Department of Posts and Telegraphs the demand for telephones in private houses was multiplying every year. One has only to think of villages in the country in which a few years ago there was not a single telephone but in which the telephones are now numbered in three figures. These are signs of the times. Many years ago there were only about four or five telex machines in the country — this is to illustrate the desire for communications — and when I left the Department we had installed over 1,000 of these machines and there was a waiting list of several thousand more. These machines are now regarded as essential by many business people who want to improve and expand their businesses and who are proceeding to modernise and become as good as the people using the same market, in other words, to become competitive and play a fuller part in it. This is best demonstrated by the all-time high figure recorded last year for industrial exports.
Deputy L'Estrange, one day, interjected across the House — and I am one of those who do not believe in interrupting people unless I am badly provoked — that it was not so long ago that we did not believe in exports. That sort of remark might be all right by way of interjection to try to put somebody off but I have a fairly good memory about exports and I remember when Deputy Seán Lemass unfolded his industrial development programme in 1932 and we made it a talking point in those days. It was not so easy to sell it to the people and it was very much decried by the Opposition in this House. One has only to turn back the records — and again I do not like wearying the House by repeating what we said in the past, because times change and people's thinking changes as they become mature — but one can turn over those records and see the factories which were coming in under protection in those days. Very few Irish people with money were prepared to invest in industry unless they got protection or a guarantee of protection from the Government, which they got. Those were the days when the nucleus of the industries of which we are now so proud was provided and which have been built up to the magnificent level at which our exports last year totalled £147 million from industrial production. The records of those days will show that the Opposition accused us of putting up workshops in back lanes and calling them factories and forcing the people to buy inferior goods when they could buy cheaper goods from abroad. There was nothing we might try to produce then that could not be imported cheaper from abroad against a very high tariff wall and we very often had what were suspected to be dumped goods and no doubt were.
However, in spite of that many patriotic people, apart from the profit motive which is an essential part of private enterprise, invested their money in industries to give a fillip to the industrial arm being established at that time. From a weak beginning, in the early '30s when there was little to expect from the home market, which God knows was a poor enough market then, these industries took root and reached the stage where today they can stand on their own feet competing in world markets against world competition. We reached the position from where we had two main industries, Jacobs and Guinness, to the point where last year we had £147 million worth of exports.
This did not happen by accident. There was a good deal of the taxpayers' money used to bring about that situation. If there is a very big fall-off in agricultural employment, which undoubtedly will go on — and it is not our problem alone, it is a world problem — we must continue to provide employment in manufacturing industry and in every possible type of industry that can be established, whether it is fishing, tourism, or just manufacturing industry as such. Every possible effort must be made and every £1 that we can spend must be utilised to get that position established. There are no simple remedies to absorb the surplus of labour which is coming from agriculture if we are to survive and provide the present improved standard of living for an increasing population which is bound to be recorded in the next census and which will be merely a continuation of the trend in the last census.
I do not think much is to be achieved by saying things which are dishonest or in which one does not believe. There is one thing that should be said in regard to the integrity of the Government and of the members of the Government, and, indeed, the integrity of the Oireachtas as a whole. By any standards, even the highest in the world, when Deputy Dillon makes veiled accusations, as he did speaking here a while ago, that there are rumours that members of the Government are getting personal gain from knowledge gained confidentially, that is a statement calculated to lower the standards of the House and of public life as a whole. It is not true and, if anyone outside this House thinks he can become a Member of this House or a member of the Government, and make money, then he must think again. If he thinks he can try to make money dishonestly in such a capacity, then he must think again, and he must learn that the Irish people, particularly those in public life, are not that way inclined. Neither do they countenance that sort of thing.
I speak, I think, for every Member of this House when I say that it will be found, that all down through the years the occasions on which anyone could make money the wrong way as a result of being in public life were very few and far between, if there ever was any such occasion in the experience of any Member of this House. Our civil servants, the Government, the Members of the Oireachtas generally are people of integrity and, when these accusations are made, however much one may be tempted to make them for the purpose of discrediting or lowering the image of one another, they result only in lowering those who make them and they certainly are of no benefit to the public life of this country.
I have never in my life had any person approach me to offer me a bribe and I have been some 17 years in this House. I do not think that any other Member was ever approached by anyone who affered a bride. I believe that every other Member of this House will say the same as I do. It is like a publican who waters the whiskey; if he wants to go out of business quickly he will water the whiskey but, if he wants to stay in business and have a good reputation, he will not do that. The same is true of the man in public life. We all do everything we possibly can to improve our image in public life and, if we are sufficiently insane to think we will improve our image by doing something dishonest, then we should not be Members of this House.
It is not fair to make accusations which cannot be substantiated. It does not do even the person who makes them any good. The road to this House is a hazardous one, which many have tried to travel but few have succeeded in making the entire journey, and the man who manages to come in here, who stays the course and makes the grade, must have something. Arriving here and staying here is not just that simple and the man who arrives must continue to have that something which will give him the confidence of the people he represents.
People engage in this kind of exercise for no other purpose than personal spleen in order to decry public life and politics generally. If such people are elected to this House they will find a very different set of circumstances. Often we are, perhaps, ourselves to blame because we make accusations when we know those accusations are untrue and ill-founded. All of us, at some time or other, in the course of public speaking have not been as correct and as guarded in our statements as we ought to be. There is a tendency to exaggerate. It is not a good one. Often one hears loose statements in this House: "Sure, you did nothing for the small farmers." I have heard that time and again in the last few days. "You have done nothing for agriculture." What exactly does that mean, remembering that we are spending millions every year to support agriculture and implement various schemes, every single one of which any farmer would want retained if he were asked tomorrow from what scheme money should be withheld or on what scheme money is not being properly used.
Small farmers have derating on valuations up to £20. That is costing a huge sum. They have headage grants for sheep and lambs and sows. They have subsidies for fertilisers. They have farm improvement grants. They have support for virtually everything they do. Then someone gets up here and says: "You are doing nothing for the small farmers". I could understand somebody saying we were not doing enough or that we could do more, but I get sick of the frequent accusation that we are doing nothing. It is a matter of all the water that has passed and the mill not working to full capacity; it is only human nature for people to keep on expecting more and more. Let us remember what we are doing and what the farmers are getmore. Let us count our blessings. If it is felt that more should be demanded in some other direction, then make the demand and justify it. But for heaven's sake, acknowledge what is being done out of the Exchequer, into which the taxpayer pays to ensure that what is being done can be done. That is why we are here today discussing a supplementary Budget, a Budget designed to provide more money to do something which nobody in this debate so far said is unnecessary.
I do not think it is necessary for me to repeat what my colleagues have said in the last few days, to repeat what we will continue to say and do in the years ahead. I do not think it would be relevant, Neither do I intend to pursue the result of the referendum, though most speakers on the Opposition side of the House saw fit to bring it in. I do not see all the things some people want to see in it. Perhaps it is only natural that the Opposition should try to pretend that they see many things in it. If we were on that side of the House we might use it too. I do not see much that one can read into it other than what was actually in it. It was not a political issue. It was for the people to decide. I remember on the last occasion we decided to abolish proportional representation and, at the same time, elect a President, the people returned our candidate as President but rejected our proposal for the abolition of proportional representation.
On this occasion they also rejected the tolerance proposal. I do not quite understand that unless it was that the Opposition in their campaign felt that, if they told the people to vote "Yes" on one proposal and "No" on the other, there might be confusion and they might vote "Yes" where the Opposition wanted them to vote "No", and "No" where the Opposition wanted them to vote "Yes". That is the only explanation. I do not think anyone can justify the decision taken on the tolerance question which is the practice in other countries——
Then the Irish electorate is ignorant and does not understand?
One thing I saw in the result of the referendum was that the people thought for themselves, and so long as they keep thinking for themselves, we will remain in power for all time.
They voted "No" twice when they thought for themselves.
They feared there would be confusion. That is the only possible explanation. The best thing I saw was the fact that they gave mature consideration to the proposal. Some of our friends said: "Look, if at some stage the tide of public opinion turned against you, the straight vote would sweep you out of office. You would never be put out under PR."
That is naïve.
That is true. So long as PR remains Fianna Fáil will remain the largest Party. That is an absolute fact. If Labour or Fine Gael ever hope to take office they can do so only under the straight vote. I am absolutely convinced about that. The only way they can ever take over the reins of Government as a separate Party is under the straight vote. I am absolutely convinced of that. One of the reasons why we lost was that that was pointed out very clearly in the campaign.
The growth rate of the economy over the past year has been most satisfactory, and people who say that is a reason for not bringing in a supplementary Budget are not talking even elementary economics. At a time when the growth rate is satisfactory, when the signs are satisfactory, and when everything is moving in the right direction, if anything occurs that is likely to upset that trend and that progress, that is the time to take action. If there is excess consumer spending and increased exports any Government in power must and will take action to change that trend. It is a question of when they should take it. If it is left too long it becomes a problem which is not so easy to solve. If action is taken in time, it can be painless and more effective, and you can bring about the desired results before there are any serious effects. That is most commendable. If people were weak and wanted to be guided entirely by expediency they would tend to ignore those things until a crisis would make it essential to take action. We have not ignored the trend.
We are as conscious as anyone else of the unpopularity of taking action at this time. It would have been noticed less if we had waited for a crash to come, but then people would say: "Why did you not do something in time?" We have been talking about the maturity of the electorate. We must be alive always to the growing interest in and better understanding of public affairs which people have. They do not expect any longer that they can have the sun, moon and stars without paying for them. They expect to be told the facts. In an expanding economy with the need for new educational standards and new schools and colleges, with the need for modern amenities, for water works, sewerage, better roads and more houses, these things have to be paid for by ever-increasing taxation and an ever-increasing cost of living. Let us be honest and not try to tell the people that you can have all these things and not have more taxation at the same time. You cannot. It should hardly be necessary to have to shout about that now, but it seems to be necessary because it is still being said. The impression is being given that we can have everything we like and no extra taxation.
Deputy Murphy suggested that a look might be taken at what is being taxed and at the method of taxation. That would be a matter of shifting from one to another. In this Budget we have selected the most painless means of extracting the necessary moneys without which we cannot go on. We would be just postponing the evil day and then it would be more difficult to solve the problem than it is now.
I do not want to go into the whole range of the social services There will be another occasion for that. There has been some criticism of the social services but not much. I am happy that the £72 million which is being disbursed is a reasonable proportion of our gross national product to pay out to the weaker sections of the community. There is not a single aspect of the whole social welfare field on which a case could not be made for more money, but we have been moving our standards steadily and consistently up to the international level.
We subscribed to the International Labour Conference recently. A minimum requirement is laid down by that Convention and our code of social welfare fitted easily into it. We more than qualified for the ratification of our subscribing to that Convention. I was at a social welfare conference in New York recently where most of the Ministers and all of the countries were represented. There was a discussion on the world problem of making social welfare an integral part of economic planning. A big variety of schemes was outlined by different representatives in respect of different countries.
I am not trying to tell the people that I am happy with our present level of social welfare but I can say without hesitation that we are better than a great many others and that the far off hills which look so green are not so wonderful when you examine them. Virtually half of our social welfare people come under the assistance side, the non-contributory side. This is a complete drain on the Exchequer. The non-contributory old age pensions, widows' pensions, children's allowances, orphans' pensions, disability payments, are a complete charge on the Exchequer.
What disability payments does the Minister mean?
I am talking about the non-contributory side. The DPA is administered through the local authorities. No one in this country goes hungry because there is not some scheme for him. These schemes have been improved. In the past ten years they went from £30 million to £72 million. That is a fairly good increase. The best and most encouraging thing about it is that our programme and policy is to continue to give that percentage of the gross national product to the weaker sections and to continue to improve their lot and expand the economy. I have said this on TV and elsewhere. I have a memorandum for the Government which has been under examination for some time. It outlines the direction in which we should move in the future. If I brought it in as a White Paper everybody would want it implemented the next day. At some stage I might do that.
We are not increasing by the percentage which the Minister mentions.
I would like to make it clear that I do not believe in saying we are going to have this soon because the cost would be out of proportion to the capacity of our people to meet in relation to other things which take priority. We are conscious of the lines on which we must move. We have blueprints for the future. I hope to implement them as time goes on, always consistent with what my friends in the Department of Finance would see fit to give me and what I can extract from them by one means or another.
One could go into many fields in this debate. I do not believe in holding up the House any longer than is necessary. The debate is quite important — too important to waste time on irrelevancies. I do not propose to cover all the field. One would be tempted to reply to some of the provocative statements made from time to time but I do not think that achieves much. We have discussed what was done in the past by this and other Governments. The only thing we can do is make comparisions and the only comparisons we can make are with the other Governments that existed. If we had been consistently in Government since 1922 we could make no comparisons. We would have to accept it if the Opposition asserted that what we were doing or not doing was wrong, and so on. But we have had breaks in the continuity of Government which give us an opportunity to make comparisons. If we take any single sector of the economy and compare it with the performance of those years we come out on top very strongly.
There is much a Government can do if they get money to do it, but they must make known that they need money to do it. The capital programme is the important thing. We never have sufficient money. We never have sufficient money to do all the things that everybody would like us to do if we were to meet all the sectional demands but we have come a fair distance. We have had to face much criticism when it came to the point of doing it. We never shirked our duty. The last Coalition in particular had a peculiar outlook on the economy of the country. When the red lights were flashing they continued to pretend that nothing serious was wrong. They went gaily ahead for almost two years when the red light was showing on every dashboard. Then, when the crisis came, they suddenly applied their retroactive brakes and crashed. That is the action of a Government which waited too long.
"Retroactive brakes"— that is a good phrase. A Leas-Cheann Comhairle, the Minister for Social Welfare has just stated no comparisons could be made if Fianna Fáil had been in office continuously from 1922 onwards. The position was that in 1922 this State was being established in very difficult times. Fianna Fáil were undermining the establishment of the State and endeavouring to hinder the Government of the day in their efforts to establish law and order, and in their efforts to establish industry and lay down a solid foundation for native government. They had to be dragged into the House in 1927, if what we are told in history is true. Despite the fact that they were dragged in here in 1927, they proceeded in 1933 to plunge this country into an economic war. The economic war has left its mark to this very day. There were very many prosperous people prior to 1933 who eventually in the late 1930's found themselves dying in the workhouses throughout the country as a result of the economic war. Numerous people on the land were put completely out of business. Many families throughout the length and breadth of the country today will never forget the early years of the Fianna Fáil administration.
It is very difficult for one speaking on this Budget to make a comment that has not already been made. It is quite amusing to be sitting listening to members of the Fianna Fáil Party defending this Budget. The whole position is that one must very candidly admit this Budget is a trick. Prior to the referendum Fianna Fáil had underestimated the intelligence of the people. They are again underestimating the intelligence of the people if they think that they are going to get away with this second Budget of 1968. There was a time when, in accordance with the proper procedure of good government, there was an annual Budget with a complete stocktaking of the financial structure of the country. The Minister for Finance presented this House with his estimate of the moneys required to run the country for a financial year. The Fianna Fáil Party have, in recent years, departed from good housekeeping and from good business procedure. They have departed from the annual Budget. We now find ourselves with two Budgets per year and, in addition to finding ourselves with two Budgets per year, we also find ourselves with increased general taxation which can be imposed without recourse to a Budget but by Ministerial Order.
Everyone knows that the Budget of last April was deliberately designed and deliberately framed by cute and cunning politicians for their own purposes, for the purposes of Fianna Fáil. They knew well that the referendum would be taking place and they knew also that if they imposed any severe taxes in that Budget they would not be relished by the electorate. They decided, therefore, to take the gamble and to introduce a three-quarters Budget in the month of April and to come with the further instalment after the referendum. The real facts are that they had to get away with the referendum.
Severe as this Budget is, if they had won the referendum they would have introduced a Budget that would have left severe blisters on the backs of the taxpayers in this country. At the same time, it is evident that there is a good deal of fear amongst members of the Government. They realise that the people are not as gullible as they thought them to be. They realise that the the people are more mature and that they now give more serious thought to issues affecting themselves.
I venture to say, without looking into any crystal ball, that the general public were never more wideawake, never more mature and never more fully aware of the scheming and planning of Fianna Fáil than they are now. The Government will not get away with this supplementary Budget. As everybody knows, this Budget is designed to enable the 1969 Budget to have a further political flavour. When the Minister for Finance introduces a Budget in 1969 it will be so planned as to almost overwhelm the people with benefits.
That is a dangerous thing to say.
It will be the last effort of Fianna Fáil to purchase the Irish people, their last attempt, through budgetary methods, to further the interests of their own security of tenure. It is no harm to let Fianna Fáil know that the general public realise this and that they will not be deceived in any way by them. This Government are rapidly going out of office. People in every walk of life — farmers, business people, and professional people — have now reached the stage in which their one ambition is to put Fianna Fáil out of office. Fianna Fáil, like stale breadcrumbs, are breaking up among themselves. This fact will be kept, in so far as it is possible, from this House and from the public in order to keep up a united front for the morale of their own supporters, and particularly for the "Tacateers" who are putting their hands into their own pockets to purchase for themselves, through Fianna Fáil, dishonest concessions.
Enough has been said about that. The smear campaign should be over now.
We had a good example of the smear campaign yesterday from one of the Parliamentary Secretary's own members.
The Taoiseach invited Fine Gael to produce the facts or else to shut up and I am now inviting Fine Gael to produce the facts.
Nothing will ever make Fine Gael shut up.
They will keep up the smear campaign. They do not know anything else. Deputy Ryan is wasting his time.
I wish to assure you, a Leas-Cheann Comhairle, that the dogs are barking in this city and everywhere else in the country. Everybody must be hearing these things, except Fianna Fáil. The entire Government is looked on with suspicion.
Produce the facts.
They are not trusted any longer. There is a wave of suspicion and a wave of distrust.
The Deputy was speaking about the maturity of the people. They are mature enough to realise the folly of the Fine Gael charges.
I do not trust any of the Fianna Fáil Government and I do not exclude the Taoiseach from that. I believe that they are a highly dishonest group of politicians who feel that no one else has a right to rule this country. They look on Fine Gael and the Labour Party or anyone else who may try to rule the country as not having the ability or the qualifications to do so. Even if another Party were to get a complete mandate from the people to rule, Fianna Fáil would say that the people would be wrong to allow anyone else to administer the affairs of the country.
We have faith in ourselves.
We cannot close our eyes to the fact that Fianna Fáil have led themselves to believe that there can be no alternative Government to themselves.
Last week, we had a lengthy debate on motions of no confidence in the present Government. If Fianna Fáil are so convinced that they cannot be replaced, why do they not dissolve the Dáil, have a general election and clear the air so that business people who have money to invest may do so in the knowledge that we will have stability of Government. The Government have introduced this supplementary Budget for dishonest motives. May I ask the Taoiseach when he expects that the limit of taxation will be reached in this country?
The Parliamentary Secretary has been promoted.
That is all right. I was not expecting it so soon.
I presume the Taoiseach will be replying for the Minister for Finance. I know the Parliamentary Secretary felt elevated by that observation. It was generally intended for the Taoiseach when he is replying.
Thanks very much. I like to hear it.
We all know very well that the Parliamentary Secretary has been dying, within the past fortnight or three weeks, to nudge and shove the Minister for Agriculture and Fisheries out.
That is another Fine Gael example.
However, the Minister for Agriculture and Fisheries is so steadfastly there that he just will not go when he is being pushed out.
Fine Gael will never learn. Fianna Fáil have been split for the past 30 years according to Fine Gael.
The position is that everything is right but that Deputy Blaney, the Minister for Agriculture and Fisheries, will not go. The Parliamentary Secretary knows that he is earmarked for the job.
Thanks for the flattery.
I was addressing my inquiry to the Taoiseach as to when he expects that the limit of taxation will be reached in this country. To listen to the Minister for Social Welfare speak, and indeed some others of the Fianna Fáil Party, one would imagine that we were living in a country in which nothing existed only the highest possible degree of prosperity. We cannot close our eyes to the fact that, whilst there may be evidence in some circles — in some influential circles — of high spending there is also evidence of unemployment to the extent, as far as we know, of between 50,000 and 60,000.
We have large numbers in this country still in receipt of unemployment assistance and unemployment benefit. We have small farmers who, despite all that has been said about what Fianna Fáil are doing for them, are put to the pin of their collar to eke out a miserable existence on the land. The clear evidence of that is the large number of people who have left the land, who have just packed up and left. Again, we have in this country a vast amount of hidden poverty that has not come to the surface but that is there — poverty amongst disabled persons; poverty amongst old persons; poverty amongst pensioners; poverty amongst those on fixed incomes who have no prospect of having their income increased; poverty amongst the many lonely people who are on fixed incomes and who do not or will not disclose their circumstances.
The plight of all of these people is well known to many charitable organisations without whose aid and assistance many of them would find themselves, in the evening of their life, in very strained circumstances. We have the case, to give the Parliamentary Secretary an example, of the widows of civil servants. We have the case of the widows of members of the Garda Síochána. We have the case of the widows in receipt of non-contributory widows' pensions. Again, we have the many and numerous old age pensioners throughout the country.
Can anybody tell me if this Government are satisfied, having regard to the degree of national welfare, national prosperity, that we have, that our old age pensioners are in receipt of sufficient old age pension to keep them in any form of Christian decency? Again, we must realise that the families of many unemployed in this country are living under very difficult circumstances. The cost of living has gone completely out of reach of the ordinary people of this country. We all know that the Government are not the ordinary people of this country. They are not the ordinary people because they are a group of 12 or 13 men who are in orbit and who are far removed from the conditions of people on the land and people in industrial employment and the old and the aged in receipt of social welfare benefits. They are so completely removed from these people that they do not know the circumstances in which they are trying to live.
I wonder if there are statistics available in regard to the sales of butter and the sales of margarine in recent times in this country. The sales of margarine have vastly increased in this country in recent times. There are numerous homes where there are children in which margarine now has to be purchased because of the prohibitive price of our butter.
Can Deputy O.J. Flanagan tell the difference?
In quality?
No.
I could not tell the difference in taste.
Then Deputy Flanagan does not win the £1.
I could not tell the difference in taste but I know that, if the advertisements are right, there is ten per cent butter in margarine. But, if we are told that, for nourishment and strength, we should have Irish creamery butter then it should be available for Irish families at a rate at which they can afford to purchase it. Their income should be sufficient to enable them to purchase it.
Does Deputy Flanagan want the price of milk reduced then?
It is fantastic that, in many cases, our own people have to eat margarine because they cannot afford to pay for our own creamery butter which can be bought on the export market for considerably less than it is available here. The British can eat our creamery butter for a price much lower than it can be bought here. That is a very great restriction.
I should like to know what the Government intend to do about providing work for our people. Recently, they scrapped the minor employment schemes, the bog development schemes and the rural improvement schemes. They had already scrapped the Local Authority (Works) Act which gave very valuable employment as well as doing very useful work. There is evidence of a cutting-down on forestry work. There is also clear evidence that road work throughout the various local authority areas has been reduced. Local authorities have reduced their road-working staffs and, when workers retire or go on pension, they do not appear to be replaced. I feel that the provision of employment is a matter of major and urgent importance. This Government have failed to provide full-time employment or anything approaching full-time employment to anything like the extent it is required.
When I hear the Taoiseach pay tribute to his Government and when I hear each Fianna Fáil Minister speak in praise of his colleague and when the Taoiseach himself gets up in this House to propose a Vote of Confidence in himself, as he did last week——
Nobody else would do it.
Nobody else would propose a Vote of Confidence in him but himself, a Vote of Confidence which was passed by his vote and the votes of his colleagues. The Government should seriously take stock of themselves. If we were to go through the activities of all the Ministers, we should find that there is no Minister with a creditable record.
We are correct in saying that the cost of living will be seriously affected as a result of this Budget. The cost of living will be mainly affected after 1st January when the wholesale tax increases from five per cent to ten per cent. That will have a very serious adverse effect on the cost of living. The cost of living has been allowed by Fianna Fáil to go sky high. Again you do not have to wait for annual budgets to raise the cost of living. This Budget has increased the cost of living on all smokers and drinkers; it has increased the cost of living on all business people, on everyone who uses the telephone or buys a stamp. Yesterday we saw reported an increase of 4d per lb on tea.
When is there likely to be an end to the chase of wages after prices? Is it not true to say that the last round of wage increases granted to workers is gone now as a result of this supplementary Budget? The Minister for Industry and Commerce did not deny that this increase of 4d per lb on tea had his sanction. In reply to a Parliamentary question recently the same Minister listed at least 130 items which have very serious effects on the cost of living and which have been increased by Fianna Fáil to make it more difficult for the people to exist.
The Minister for Transport and Power said here the other day that he does not like to see workers spending a £1, that for every £1 the worker spends, 8s 6d of it is spent on something that is imported. That gives me to understand that there is a policy in Fianna Fáil to take money by way of taxation out of the pockets of the people, particularly the workers. They are not going to be allowed to spend their own money. Fianna Fáil will take it from them and spend it for them as they think fit.
This Budget puts the licensed trade in such a serious position that they have to seek an immediate interview with the Minister to discuss what additional prices they can put on in order to keep their staffs in employment. I look upon the licensed trade as a very useful and productive section of employers who treat their staffs in accordance with trade union regulations. It would be a great pity if the licensed trade had to reduce their staffs. That is what will happen, because we have seen throughout the country many licensed premises being improved and brought into line with modern times, and now this Budget will mean less business for them, and a smaller turnover. It will also mean that trade union members working for the publicans will have to seek higher wages in order to meet the higher cost of living resulting from this Budget. When the cost of living rises and when it becomes more difficult for people to live, their only remedy is to seek, through their trade unions, an amount which will enable them to purchase the necessaries of life in the form of food, light, heat, clothing and shelter.
Is it not as plain as A, B, C, that when the Government introduces a supplementary Budget such as this, they are immediately inviting another application for all-round wage increases? The trade unions have a duty to their members, particularly in the new year when the effects will really be felt, to see that those members will be in a position to secure the necessaries of life. This is a Budget which takes all and gives nothing.
I addressed a question to the Ceann Comhairle and he disallowed it because he said it was a matter proper for discussion on the Financial Resolution at present before the House. Therefore, I assume I am in order in dealing with it. I was about to ask the Minister for Social Welfare what steps he would take in conjunction with the Minister for Finance and the Revenue Commissioners to make pipe tobacco available at a cheap price to old age pensioners and to inmates of institutions — for such people pipe tobacco is reaching a prohibitive price—or have Fianna Fáil reached the stage where they are out deliberately to deprive the old age pensioner of his pipe tobacco? They are not concerned about pipe tobacco now. They are more concerned about the valuable cigar Tacateers. I have seen more Ministers smoking cigars——
They go better with the champagne.
Last night the Minister for Agriculture and Fisheries did not deny celebrating the turnover tax by having a couple of bottles of champagne. On the night the turnover tax was passed by the shady and queer methods by which it was passed, the Minister decided he would bring his friends down to the Dáil restaurant and would buy a few bottles of champagne in order to celebrate the great event of taxing the people out of existence. They drank toasts to the confusion of the people and success and long life to the turnover tax. They drank champagne. The Minister tells us he bought a few bottles of champagne.
Pink champagne.
I am not interested. They bought champagne, he tells us himself, and they had toasts. They were so delighted and charmed that they had succeeded in taxing the people out of existence with the turnover tax that they had to drink to the health of the taxpayers and confusion——
The Deputy will have to make up his mind.
And now, the Parliamentary Secretary to the Minister for Finance, Deputy Gibbons, says that going with the champagne is a cigar.
Dr. Risteárd Mulcahy advises cigars rather than cigarettes.
"Doctors differ..."
Deputy Corish should not have said that.
Why?
You caught him on the wrong foot. We will give him time to think.
I am not a cigar smoker. I am not a cigarette smoker. For all I know, there was another toast in champagne when this Budget was introduced the other night. Perhaps, it has now become the custom that every time new taxes are inflicted on the Irish people there is an adjournment to the Dáil restaurant where, as guests of the Minister for Agriculture and Fisheries, they have a champagne party. Now we have the suggestion that coupled with the champagne party, on the recommendation of the Parliamentary Secretary to the Minister for Finance, they should smoke cigars. More power to them. They can drink champagne and smoke cigars and celebrate the great victory of additional taxation on the people while no effort is made to provide the old age pensioner with his lowly pipe of tobacco at a reasonably cheap rate. A good case can be made for providing that on presentation of an old age pension book it should be possible for the pen-sioner to obtain an allowance of tobacco at a reasonable rate. The price of tobacco has gone out of control. Something should be done about having cheap tobacco provided for inmates of county homes and institutions where there are large numbers of old people who like a smoke and to whom smoking is the only pleasure.
There was a reference this morning and yesterday to members of the Government working as a team. What kind of team is this? Can anyone say which member of the Government has any achievement to his credit since the last general election? I should like to hear what are the achievements of the members of the Government, individually or collectively, since the last general election. The last member of the Government who spoke in this debate was the Minister for Social Welfare. The social welfare benefits and assistance applicable in this country must rank as amongst the lowest in Europe. Is that what the Minister has to boast about? Unemployment assistance, unemployment benefit, widows' pensions and old age pensions, the disablement benefits administered through the local authorities are completely inadequate to keep body and soul together and are tied up in red tape. The Minister for Social Welfare has nothing to offer by way of achievement. The Minister for Health has nothing to offer because our health services, again, must rank as, perhaps, one of the worst health services in the world. For instance, there is in operation the old dispensary system with no choice of doctor, as was promised. There is the spectacle of our people having to use every possible means open to them to obtain a medical card.
The Minister for Local Government has no achievemnt to offer. He is in the greatest disgrace of all because, not alone has he no achievement to his credit, but he has disastrous failures on the debit side. Instead of looking after the housing needs of the people of Dublin, Cork, Limerick and elsewhere, he has devoted the greater part of this year to talking about a referendum, trying to create a position in which as a result of the rigging of constituencies he and his Party might remain in office. The housing position not only in the cities but in all provincial towns is reaching the stage of national crisis and the Minister for Local Government has no achievement to offer in this respect.
The Minister for Transport and Power has no achievement of offer. That is evidenced by the increased rail charges, increased bus fares, unresolved difficulties with the ESB and their staff, substantial losses by Bord na Móna, reduction in employment in Bord na Móna.
What has the Minister for Posts and Telegraphs to show? As a result of this Budget there will be increases in the price of stamps, of the telephone service and all these other services to which the public are entitled. Yet, the Post Office is alleged to have been paying.
The Minister for Industry and Commerce has failed miserably to keep the cost of living within bounds. He has failed to introduce any form of price control. By orders which he makes he has allowed prices to go sky high, and, as a result, the high cost of living has created more difficulties for the aged, the sick and the workingclass. The Minister for Industry and Commerce, therefore, has nothing to show to his credit.
The Minister for Agriculture and Fisheries has nothing to show to his credit. As has been mentioned many times in this House, he has gone beyond taking advice and has reached the stage where he is talking to no section of the agricultural community. The only boast that the Minister for Agriculture and Fisheries could make was his announcement during the week of 1d per gallon for the first 7,000 gallons of milk produced, which means £28 or £30 per annum. Like every other member of the Government, the Minister for Agriculture and Fisheries has no achievement to show since the Government were elected to office.
If we are reviewing Government policy and take Minister by Minister we cannot point to one Minister who has a worthwhile achievement to his name since the last general election. We were told that the establishment of the Department of Labour would help to solve labour difficulties and to bring about a greater degree of cooperation between employer and employee. We were told that during that time the Department of Labour would solve the problem of the many weeks which were lost in this country as a result of strikes.
Progress reported; Committee to sit again.