asked the Taoiseach if he will make a statement on the proposed British import restrictions; and what action the Government intend to take to deal with the situation.
Private Notice Question. - British Import Restrictions.
I would refer the Deputy to the statement issued by me yesterday, copies of which have been placed in the Oireachtas Library. I propose to cover this matter in the course of my reply tonight to the debate on the Financial Motions.
Arising out of the Taoiseach's reply, is it not a fact that this action by the British Government is a definite breach of the Free Trade Area Agreement? In view of the fact that this breach of the agreement was made by the British Government without advance consultation, can the Taoiseach say what action it is proposed to take in relation to it?
The question of whether the action of the British Government is a breach of the agreement — their action in introducing a scheme of import deposits — is a matter on which there can be conflicting opinions. Nevertheless, we are of the opinion that it is clearly a breach of the spirit of the agreement. As to what action we propose to take, this is a matter we have at present under consideration, but the immediate and most effective action has been taken with the co-operation of the banks.
While appreciating the action taken to relieve the problems our exporters will have, surely it is a situation which calls for action on our part? We have a situation in which the Government here are lending the British Government money to get them out of their balance of payments difficulties while the British Government clearly have taken action which is contrary to the letter and the spirit of Article 18 of the Free Trade Area Agreement.
The Deputy has mentioned Article 18. It is open to either party to the agreement to take certain action in the event of that country running into balance of payments problems. Such action includes the imposition of quantitative restrictions. These are defined in Article 24 as prohibitions or restrictions on imports, whether made effective through quotas, licences or other measures with equivalent effect, including administrative measures and requirements. As I have told the Deputy, whether the action of the British comes within that definition is open to argument. The position is being examined closely by us at the present time. As for lending the British Government certain moneys, I do not think that applies because the moneys which will be used for this purpose would not be available to us for capital purposes in the ordinary way.
Will the Taoiseach contemplate taking any action to offset the British action? Under Article 18 of the Agreement, we are entitled to take counter-balancing action if we wish to do so. Has that aspect been considered and, if so, what action do the Government propose to take?
Certain action is under consideration but one does not rush into taking action of this nature unless one is sure the effects will not be to our disadvantage. As I have said, these matters are under consideration.
Will the Taoiseach agree that in view of this action by the British, taken unilaterally, the possibility of breaking this agreement should now be considered by the Government? Does the Taoiseach agree that this last action by the British is serious enough to merit our consideration of breaking the agreement?
At present I do not.
Will the Taoiseach say whether it will cost approximately £50 million to provide this assistance to Irish industry?
It is hard to say. It has been estimated that the cost involving six months exports of the kind that will be affected would amount to maybe £20 million to £25 million by way of the required deposit.
About six months?
About six months.
This could mean £50 million a year.
No.
It is £25 million.
That means it will cost £2½ million in interest.
It would cost £2 million.
Who would pay?
The Government have undertaken to the banks that they will not be at a loss.
The Irish taxpayer will pay it.
The Irish taxpayer, yes. We have undertaken that the banks will not be at a loss. If we cannot get any other redress as a result of negotiations to be undertaken, the taxpayer would be responsible.
Does the Taoiseach recall that when bringing this agreement before the House it was made clear there would be consultations between the two Governments before anything like this should happen?
We got short prior notification. We did not have consultations and we would have expected consultations in a matter which was as serious as this. We did not have those consultations.
As this is the second occasion within two years in which the British Government acted unilaterally and gave the minimum notice——
How does the Deputy mean "the second occasion"?
The levies.
The surcharge was imposed before the agreement was effected.
But it continued after the agreement was in effect and it continued after Deputy Lemass, as Taoiseach, tried to get its removal. Is it not a fact that this definite breach of the agreement, taken in conjunction with a recent decision by the British in regard to agricultural exports through which there is to be some sort of selective system operated, means that the British have broken the agreement deliberately in respect of two major aspects of our economy?
There was no recent decision taken by them in regard to agriculture. The announcement by the British Minister of Agriculture amounted to a restatement of a production plan in existence for some years.
That is a euphemistic impression.
It came as a surprise to the Minister for Agriculture and Fisheries in the last few weeks. He did not know about it until he read about it in the newspapers. He said he is examining it only now in relation to agricultural exports.
The matter was dormant for a long time.
The British did not consult us.
Oh, Deputy——
Now, Taoiseach——
There is no point in snide remarks from the Leader of the Labour Party. The fact is that what has been there in the British plan in so far as their projected selective expansion is concerned was indicated clearly to you as well as to us in 1964. There has been a projection of that in respect of the period 1970-72 and my Department and I, and the Government, are examining what is now being said. We should examine it fully before we open our mouths too widely.
The Minister did not seem to know anything about it until he read the newspapers.
I had asked for leave to discuss this matter on the adjournment of the House but, because an opportunity has been given to discuss it, I beg leave to withdraw my request.