Before I call on the Minister I should point out that some copies of the Finance Bill have been found to contain an inset of pages relating to another Bill. Correct copies are available for any Member who may have received the incorrect version.
Finance Bill, 1969: Second Stage.
The bells and the Bills. You cannot get anything right, apparently.
The responsibility is not mine.
Why is it necessary to have all these resolutions? Do they relate to some new section? Could the Minister tell us in the course of his speech?
They are the Financial Resolutions and the Money Resolutions which must be taken before the Committee Stage. They do not arise at present as we are now only at the Second Stage.
I move: "That the Bill be now read a Second Time."
The Bill contains the provisions implementing the Budget proposals as well as provisions on some other matters. All the sections are dealt with in the explanatory memorandum which accompanies the Bill. I propose to give a brief outline of the provisions, while treating at greater length certain matters of particular interest.
Part I is concerned with income tax. Section I maintains the rates of income tax and surtax unchanged, while section 9 provides for the increased personal allowances announced in the Budget.
Part I also contains provisions to meet specific cases involving hardship or expenses arising from special responsibilities. Section 3 introduces a new deduction of £100 for a taxpayer who has to employ a housekeeper to look after a totally handicapped spouse. Section 7 extends the relief for medical expenses introduced in 1967. Section 10 permits the parent of a handicapped child over 16 years of age, who is not in receipt of full-time instruction, to claim the child allowance of £150 instead of the dependent relative allowance of £60. It also provides for the adjustment of the tax deduction for children eligible for the increased social welfare children's allowances announced in the Budget. Sections 13 and 17 are consequential on this provision. Section 11 increases the income limit for the income tax deduction in respect of a dependent relative. As a measure of assistance to manufacturers and traders who have to purchase new machines or adapt existing machines for the purpose of the changeover to decimal currency, provision is being made in section 4 to enable the cost to be written off immediately. Section 5 provides relief for Irish assurance companies in respect of income from pension annuity business carried on in Great Britain or Northern Ireland, the purpose being to put them on the same competitive footing as British companies. Section 6 contains a technical change in regard to assessments for the years prior to 1963-64.
Section 8 deals with the method of taxation of the employees of the Bank of Ireland on its forthcoming merger with the National Bank and the Hibernian Bank. Its effect is to maintain the present system for the existing employees of the Bank of Ireland and to put all new employees on the PAYE basis. Section 12 is a consequential provision.
Section 14 amends the existing legislation in regard to capital allowances for new ships as a consequence of the recent legislation introducing investment grants for such ships. The extensions of the periods of the exports tax relief and the "Shannon" relief which I announced in the Budget are given legislative effect in sections 15 and 16.
I would like to draw particular attention to section 2 which deals with the exemption from income tax of earnings of writers, composers, sculptors and painters. The purpose of this relief is, as I announced in the Budget Statement, to help create a sympathetic environment here in which the arts can flourish by encouraging artists and writers to live and work in this country. This is something completely new in this country and, indeed, so far as I am aware, anywhere in the world. We are entering a field in which there is no precedent or experience to guide us. It is a difficult undertaking because there are bound to be differences of opinion as to what constitutes a creative work and what has or has not cultural or artistic merit. We must, therefore, approach the matter in an empirical manner, feeling our way as we proceed, in a spirit of willingness to learn from experience and to adjust our arrangements from time to time in the light of that experience. I would ask, therefore, that people would not be unduly critical of our first attempt.
The relief will apply to earnings from a book or other writing, a play, a musical composition, a painting or sculpture which is original and creative and which is regarded as having cultural or artistic merit. This question will be for adjudication by the Revenue Commissioners who may consult persons or bodies whom they consider competent to advise them. In view of the experimental nature of the measure, I am asking the Revenue Commissioners to be liberal in administering it and to give the benefit of the doubt where it arises to the writer or artist. I might add that the Revenue Commissioners have long been accustomed to seek expert advice on pictures, writings and other works of art for the purpose of the exemption of such articles from death duties under section 28 of the Finance Act, 1931. No particular difficulty has been experienced in the administration of that section.
It will be noted that the section provides that, once the Revenue Commissioners have determined that a particular work has artistic or cultural merit, the writer or artist will be entitled to exemption in respect of earnings from that work and all his other works in the same category. They will look to the status of the individual rather than to any particular work. In other words, the idea is that once an individual establishes that he is a creative writer, composer, sculptor or painter, his income from all his work in that capacity is free of tax. I expect therefore that persons who have already won general recognition in these spheres of artistic and cultural endeavour will qualify for the tax exemption on their reputation and that only a minority will be required to submit their work to the Revenue Commissioners.
I am convinced that we are right in making this attempt to improve our cultural and artistic environment and I am encouraged by the welcome given from all sides both at home and abroad to the principle of the scheme. I am hopeful that it will achieve its purpose.
Part II and Schedules 4 and 5 contain the provisions to give detailed statutory effect to last year's policy announcement that income tax under Schedules A and B would be abolished. The Finance Act, 1968, provided in effect for the abolition of these schedules by terminating assessments as from the current tax year, but their definitive removal from the income tax code requires much more detailed legislation.
Section 18 exempts from tax farm profits including profits from fees for the services of a stallion. At present, the latter are taxable under Schedule B or Schedule D depending on whether the stallion stands on the taxpayer's land. The Survey Team on the Horse Breeding Industry set up in 1965 by the Minister for Agriculture recommended that in view of the trend towards the syndication of stallions and the size of the investment now required to purchase a good class stallion, the sale by syndicate members of nominations for, or shares in, stallions should be exempted from tax. The abolition of Schedule B carries with it as a necessary consequence the exemption of profits arising where the stallion stands on the taxpayer's land and I am also making provision for the exemption of profits arising to an owner or part owner of a stallion from the sale of services or right to services where a charge under Schedule D would have arisen.
It may be as well to mention at this point that where a company engages in farming it is at present liable for corporation profits tax or any profits therefrom and this will continue to be the case.
Section 19 provides that profits from cattle dealing and milk dealing shall, as heretofore, be chargeable under Schedule D, but under Case 1.
As a consequence of the exemption of farming profits under section 18, provision is made in section 20 that dividends out of such profits shall be paid without deduction of tax. This arrangement is similar to that which applies to dividends paid out of profits exempted from tax under the "Shannon" relief.
The effect of section 21 is to bring the tax treatment of profits from farming in Great Britain and Northern Ireland into line with the treatment of similar profits from other countries.
The abolition of Schedule A presents the opportunity of bringing the tax treatment of long lease rents, that is, rents from leases of over 50 years, into line with the treatment of other rents. This is effected by section 22. Such rents will now be paid gross and the recipient will account for the tax thereon. This will not involve an extra charge on the recipient; in fact, he will now, for instance, be allowed a deduction for the cost of collection. The section also brings into charge receipts from easements. These receipts, which are in the nature of rents, include receipts from car parks, caravan sites, fishing rights, etc.
Section 23 prescribes the deductions to be made in arriving at the amount of the income from rents and easements which is to be charged.
Sections 24 and 28 provide relief from the charge under section 22 in certain cases.
Section 25 involves an exception to the new system of taxation of rents under section 22 in respect of rents payable to a non-resident. This is necessary to safeguard collection of the tax. Further exceptions are provided by section 29. Certain technical points arising out of the new system of rent taxation are dealt with in sections 26 and 27.
Sections 30 and 31 provide relief to meet specific situations on the abolition of Schedule A.
A new basis of assessment of the benefit in kind by way of accommodation provided for directors and certain employees is introduced under section 32. At present, in certain circumstances their value is based on the Schedule A assessment. The section provides that such benefits will now be taxed on the basis of the letting value.
Section 33 effects the amendments of the Income Tax Acts and of the Estate Duty Acts which are specified in the Fourth Schedule and which are consequential on the abolition of Schedules A and B. The repeal provisions in connection with this abolition are contained in section 65 and are listed in Part I of the Fifth Schedule.
Part III of the Bill, which deals with Customs and Excise matters, provides for the increases announced on Budget day in the rates of duty on tobacco, hydrocarbon oils, beer, wine, spirits and on duty-paid tobacco stocks held by manufacturers on Budget day.
This part of the Bill also contains some minor reforms of the Customs and Excise laws not mentioned in my Budget Statement. The Bill takes account of future developments in relation to hovercraft; responds to representations from the Irish wine makers by permitting the bottling of Irish wine in warehouse and the use of duty-free spirits to fortify Irish wine in warehouse; simplifies the tobacco manufacturers' licence duty and makes better provision for safeguarding the table waters duty. The sections are relatively straightforward and I need not add to the information contained in the explanatory memorandum.
Part IV contains two sections giving effect to the reliefs in death duties which were announced in the Budget. Section 45 enables the abatement of estate duty in respect of a widow's benefit to be increased in certain circumstances. Section 46 extends the scope of an existing relief relating to agricultural land.
Part V of the Bill deals with the budgetary changes in stamp duty. Section 47 reduces from a rate not exceeding £3 per cent to a rate not exceeding £2 per cent the duty on purchases of property valued at not more than £6,000 and increases from £3 per cent to £5 per cent the rate for property exceeding £50,000 in value. Section 49 abolishes the stamp duty on first purchase of grant-type houses, on sales by local authorities to tenant purchasers and on sales by public utility societies to their members. A new charge of £10 per cent is being imposed by section 50 on contracts valued over £50,000 for office block development, except where they are owned by the State or a local authority or are in an undeveloped area.
The provisions reducing the rates of duty will operate from Budget day, 7 May. The increased duties take effect from a current date.
The provisions in Part VI on corporation profits tax are consequential on changes made in Part I in regard to income tax.
Parts VII and VIII of the Bill relate to the changes in sales taxes legislation and do not require further explanation at this stage. Section 57 provides, of course, for the increase in the wholesale tax on certain less essential goods. In view of the social aims of the Budget, it seemed appropriate that some of the extra revenue required this year should be obtained from these sources.
Finally, I come to Part IX of the Bill. Section 61, which is a customary provision, fixes the annuity for the redemption of the debt incurred on the voted capital services in 1968/69 and 1969/70.
The Provisional Collection of Taxes Act, 1927, is a most useful part of our financial legislation. Financial Resolutions which are given statutory effect under this Act by the Dáil in Committee on Finance on Budget day, enable revenue to be collected immediately at the higher tax rates. This prevents the massive clearances of goods at pre-Budget rates of duty that would ensue if the budgetary increases could not be enforced straight away.
Section 4 (1) (f) of the 1927 Act provides that Financial Resolutions lapse in the event of a dissolution of Dáil Éireann. This is the provision which made it necessary in 1938, 1944, 1951, 1954 and again this year to present the new Dáil with a Collection of Taxes (Confirmation) Bill which had to be passed without delay in order to give statutory cover for the increased rates of duty collected since Budget day. I think that the provision serves no useful purpose because, even if a new Government did not accept the budgetary proposals of the former Government, they could bring their own proposals before the Dáil and indeed could propose, if they so wished, that the increases collected since Budget day should be refunded. There is, therefore, no need for the provision in section 4 (1) (f) of the Provisional Collection of Taxes Act, 1927. It merely creates doubt and uncertainty about the collection of the revenue at a critical period. I propose therefore in section 62 of this Bill to repeal that provision. Section 63 secures that premiums payable on the maturity of Government securities shall be exempt from tax except where they form part of the profits of a business of dealing in securities.
Section 64 introduces two amendments of the provisions in regard to capital allowances for manufacturing premises and hotels. First, these allowances are now being extended to capital expenditure by manufacturers and hotel keepers on providing recreational and welfare facilities for their workers. Second, the allowances may now be claimed for capital expenditure on holiday cottages registered by Bord Fáilte.
Before I conclude, perhaps I should say, even though precedent would not indicate that it was necessary for me to do so, that while I am not an artist, writer, composer or sculptor I do some farming and bloodstock breeding. I now commend the Bill to the House.
This Bill, as do all Finance Bills, deals with a number of technical matters which may more appropriately be considered on the Committee Stage. Some of these will be the subject of more detailed consideration when we reach that Stage but there are a number of more general matters that I think might be appropriately discussed at present and which, in one way or another, have been the subject of consideration in discussing economic questions and also in granting relief in certain respects for persons affected by the rise in prices.
I suppose the post-war era has been more marked than possibly any previous comparable period—certainly with greater intensity than any other period—by the continuous rise in prices and the continuous drop in the value of money and the general consequences of results commonly referred to under the heading of inflation. Government policies, both here and elsewhere, as well as discussions in the Dáil and in other parliaments have dealt at considerable length with the steps which should be taken at particular times to deal with the problem and minimise its effects. It is generally accepted that price stability is not merely the aim of governments and political parties but is in a general way the aim of all responsible sections in the community.
Rising prices produce a wide range of unpleasant—to put it mildly—and, in some cases, serious reactions and consequences for those affected by them. Increased prices involve increases in the cost of Government expenditure not always matched by revenue buoyancy and involve at particular times budgetary and other difficulties.
So far as the average individual in the community is concerned, the serious consequences of rising prices and inflation generally are felt in the impact on wages, salaries and incomes, and more particularly the social effects on persons affected by price rises. This, of course, is particularly so in the case of pensioners and others on fixed incomes. So far as State action is concerned, in the past 20 years there have been many pension increase Acts—I think the first was in 1949 or 1950—to deal with the position of State pensioners and other persons assisted by the State, either retired State personnel or social welfare recipients. In the intervening years, at annual intervals, sometimes less frequently, pension increase Acts have been introduced which were designed to mitigate or offset rising prices either by granting increases in the pensions payable to personnel who had retired or by directly increasing social welfare benefits.
These measures were, of course, confined to certain categories—retired State and semi-State personnel and to social welfare recipients. There are, however, a large number of persons in the community who do not benefit from these measures—persons on fixed incomes not drawn in the form of pension either from the State or from some other such body and who are outside the social welfare category. However, this has very often been overlooked in framing legislation to deal with the problems I have presented.
In the course of a number of discussions, we have strongly advocated the introduction of a prices and incomes policy. Many references have been made in NIEC and other publications to the need to adopt such a policy and to the responsibility which devolves on the Government to give a lead in the matter as well as to encourage and to assist in its implementation. Attention has been recently directed to this matter by the NIEC in their publication on the out-turn of the economy for 1968 and the outlook for the current year, and it has been referred to also in the Irish Banking Review for June 1969 when the matter was described in a heading. “New Incomes Policy Vital”.
The Governor of the Bank of Ireland also dealt with the matter at some considerable length when he referred to problems which have been created and to aspects which affect not only banking investment and so on but also wage and salary earners. In the course of this paper, he remarked on the proposition that as long as the extent of inflation is small or minimal the reactions and experience as felt by individuals and families are not considerable. However, he adverted to certain serious aspects which affect not only Government or institutional borrowing but have their effect also on the substantial growth of debt and the consequence for both State and institutional borrowing of very steep rises in inflationary tendencies to the extent we have experienced in recent years.
I believe it is important to consider this matter in the light of the trend that has manifested itself and having regard to the effect of price rises on many sections in the community, particularly those on fixed incomes, those who are not covered by the provisions in the Budget or by the reliefs in the present Finance Bill or who will not benefit by the increases in the social welfare arrangements. It is true that in a number of cases where increases have been granted the tendency has been for these increases to be offset within a relatively short time by a rise in prices. The effect of inflation and price increases on these sections of the community has been particularly severe and the attempts by the Government to deal with this problem have so far been inadequate and insufficient. The continuous comments of the NIEC, as well as the references made in publications such as the Banking Review and so on, indicate the concern of a large section of people for the situation which has continued and that has been reflected in prices changes and price increases which have been shown from statistics.
In the actual reliefs provided in the Finance Bill, there are certain aspects that do not deal sufficiently or in as full a way as is necessary with the particular categories concerned. There are two specific provisions designed to give relief for income tax purposes in respect of income and also in respect of persons who have to employ someone because of the incapacity of a spouse. Rightly or wrongly, when the Budget was going through I think a number of people were under the impression that this relief in respect of a person who was incapacitated and who had to employ someone to look after him would apply to an unmarried as well as to a married person.
My attention has been drawn to at least one specific case where a person is disabled and unable to look after himself who resides alone and has to employ a housekeeper to look after him. Under the provisions in section 3 this tax allowance is confined to a married taxpayer whose spouse is incapacitated and who employs a housekeeper to care for her. The person who is unmarried and incapacitated should be treated in the same way and should be entitled to claim relief. In some cases the hardship can be just as great and the need for help just as pressing as in the case where a married person has to employ help because the spouse is incapacitated.
There is a similar difficulty in regard to section 11. My attention has been drawn to a case where a person is in receipt of a tax free allowance of £60 on his PAYE certificate in respect of his mother-in-law who has no income except a contributory widow's pension and whatever financial support she receives from her son-in-law. In the financial year 1968-1969 the inspector of taxes advised that as an increase had been given with effect from January last and the mother-in-law's income had exceeded the limit of £140 per annum by £18, the allowance was consequently reduced by £18 at the rate of 7/- in the £ per year. In section 11 of the Bill it is proposed to raise the allowance from the sum of £140 to £196. Whether that increase will cover the case or not is not clear, but I mention it now so that the matter may be considered between now and Committee Stage. The present contributory widow's pension of £3 5s per week amounts to £169 in a full year, or a sum of £29 over the income limit. This reduces the tax allowance in this case to a mere £31. As a result of the increase of 10/- per week which will apply as from January next, this person will have an income of £195, or £55 over the limit, and this leaves the net tax allowance at £5 per annum. I mention these two specific cases for consideration.
There are, however, other aspects of this that require to be adverted to. In recent years there have been a number of reports which have now been completed and certain action has been taken in respect of the simplification of the tax structure. I think there were in all seven reports and while some changes have been made, it has often appeared to me that a number of these changes should be made at a time other than during the passage of the Finance Bill. The Finance Act, in the main, implements the Budget decisions and gives statutory effect to the resolutions passed on Budget day and to the other taxes and consequential changes in the tax structure. There are a great number of matters that should be simplified and considered in isolation from the annual Finance Bill, at a time when it would be possible from every point of view to give more detailed and careful consideration to them.
In a number of debates here recently we have had reference to the intention to introduce the added value tax. I want to advert particularly to this problem at present for the reason that the operation of the present tax structure involves great administrative and bookkeeping difficulties for small shopkeepers and traders. They have not merely to meet the ordinary income tax or surtax, if they are liable, but also to deal with turnover tax and wholesale tax. The present system is complex and difficult for individuals but even more so for traders.
We have, over many years, given relief in respect of agricultural land. Indeed, reference has been made to the fact that to a very considerable extent agricultural holdings are relieved from rates. There is no similar relief in respect of urban dwellers such as small shopkeepers and traders who have to face not only a steep rise in rates, to a great extent due to the health charges, and the other rises incidental to increased expenditure, but also severe competition from large concerns such as supermarkets. It seems to me, therefore, that consideration must be given to providing some from of relief for small shopkeepers and traders.
The Finance Bill is being taken at a time when a great deal of attention is being focused on the operation of the free trade area agreement. I and my colleagues have consistently argued that the circumstances in which the agreement was originally negotiated, in anticipation of membership of the EEC, have changed radically and that the time has come for a full-scale review of that agreement.
It is 3½ years since the agreement was negotiated and many changes have occurred in the meantime, particularly the introduction of the British import deposit system, the limitation in respect of certain agricultural products and the annual reduction of tariffs here. As I understand from some remarks of the Taoiseach, it is proposed to initiate a review at a relatively early date. I want to urge that that review would be a full-scale review of the effects of this agreement before repercussions of a permanent character are felt by Irish industry and agriculture and also by those employed in these spheres.
The Minister, in the course of his speech, referred to certain tax changes. One aspect of the present income tax allowance structure is that the allowance in respect of earned income relief for married women workers is virtually non-existent. Indeed, many married women workers have complained about the operation of the present system. Nowadays a great many married women are obliged to work to supplement the family income. In such cases the income tax allowance is minimal.
Other categories of workers are also adversely affected. I refer, in particular, to those who work at times when public transport is not available. The case has been made to individual Deputies by those concerned that there should be some relief in respect of travelling expenses where workers are compelled to supply their own transport, either individually or in cooperation with their fellow workers. There is a strong case for giving some relief to this particular category.
The provision for the encouragement of artists, writers and so on has been referred to not merely in the Budget debate but also in the Minister's introductory speech today. This is a provision that should be interpreted very liberally. There is no precedent except, perhaps, whatever precedent may exist after consultation of certain recognised authorities in the case of death duties. We must consider this from the angle that there are few areas in which there is room for such disagreement as there is in deciding what is or is not a work of art. We have had evidence of differences of opinion, differences in views and in attitudes recently on the part of members of the Royal Hibernian Academy. I believe there is a strong case for interpreting this provision as liberally as possible. Apart from consultation with bodies like the Arts Council, I think there should also be provision governing the right of appeal. There is also a case for considering certain selfemployed people, who earn a large income in a particular year and who show no profit another year. There is a strong case for allowing such people to stagger tax liability, averaging the tax out over a number of years.
The relief provided in section 16 is the measure which has resulted, above all, in promoting the growth of industrial exports. This is a continuation of the relief introduced in 1956, a relief which is the single biggest factor in promoting industrial expansion.
The provision in section 57 for covering the increase in wholesale tax will involve a considerable rise in costs. I do not know whether the Minister and the Government have considered the effect of an increase of as much as 5 per cent in the wholesale tax, particularly in relation to contract prices.
The provision consequent on the abolition of Schedules A and B and the change envisaged in section 18 is desirable. The bloodstock industry is one of the most important in our whole economy. It provides large-scale employment over a wide area. There are relatively few counties which do not benefit in one way or another. In addition, the employment is male employment of a permanent character.
There are nice young groomswomen going around.
There is a large income from the sale of bloodstock and benefits accrue to small breeders and owners as well as to those of substantial means. Nowadays—this is a post-war phenomenon—the good stallion with breeding and performance is rather expensive. In almost every case he is beyond the resources of the individual owner or breeder and the post-war era has seen the widespread introduction of syndication or share ownership. This has a number of advantages. It offers opportunities to more breeders to avail of the services of the stallion. It also spreads the risk over a number of persons. It is generally favoured by breeders and is regarded as beneficial in present conditions. Any steps we take to help and encourage the bloodstock industry will be welcomed. The changes proposed in section 18 are both desirable and worthwhile. The development of the bloodstock industry as a result of the encouragement provided by the revenues raised by the Racing Board has dramatically altered the whole picture of Irish racing and the effect of Irish bloodstock, not only here but abroad; the industry has not merely attained the highest standards common in other countries but has on many occasions surpassed the competition provided by other countries.
We have over the years endeavoured by a variety of devices to encourage industry to provide employment in the rural areas and, to that end, we have given incentives of one kind or another. This particular industry is, as I say, widely dispersed and with the exception of the facilities provided in respect of the encouragement of stakes and so on, it is largely financed by those involved in it. This measure of assistance must be regarded as being devoted to the right objectives and should provide for the further attraction to this country of high class stallions and the further development of the industry in every way possible. It is an aspect of our economy that very often gets insufficient attention from those who are not familiar with it. From an economic and social point of view, and, indeed, from every aspect from which this matter is considered, it has attractions that should involve the State in promoting and encouraging it to the maximum extent.
The change provided in section 32 is also consequential on the abolition of sections 30, 31 and 32 and the abolition of Schedule A and I should be glad to know whether the proposed change was covered by the Financial Resolutions and also whether the effect of this will not be to impose possibly some increase in respect of say a manager of a factory who is living in a house or in accommodation provided by the factory. As I understand the change, he will now be assessable on the market value. Will this change involve an increase in tax liability and, if so, has any estimate been made of the effect of such change and to what extent is it affected by the Budget Resolution?
There is another matter which normally would not be within the terms of the Bill but which, because of the widening of the scope of the debate, merits some attention. This is the question of Government policy in regard to the Buchanan Report. It is difficult to understand the reasons for delaying the publication of this report. A period of nine months elapsed before it was published. While one can understand that the Government required time to reach conclusions on it, it is difficult to understand the reasons which, after delaying its publication, have been advanced for not reaching decisions. I want to urge that this matter be considered fully and openly before decisions are reached. The recommendations in that report involve decisions in respect of certain defined areas and certain towns and cities will be affected to their advantage while others will possibly be affected to their disadvantage. Of course, it marks the end of any policy such as was operated in respect of the Undeveloped Areas Act. I suppose that Act was effectively dropped, from the point of view of further development, 10 or 11 years ago, at the time the Grey Book was published. The decisions involved in the Buchanan Report are major decisions which must be taken in advance of action in respect of certain matters, decisions which will apply for a considerable period ahead.
We have always favoured the idea of growth centres but there are political and other consequential decisions involved. It may have been impolitic to announce, on the eve of the election, some of these in advance but now the election is over and, indeed, it is possible that by the time the decisions become effective we will be nearer the next election, no matter how active or energetic the Government may be in pursuing their implementation. However, there is an obligation in matters of this sort to encourage and facilitate public discussion on them before decisions are taken. These decisions and their implications should be announced only after full consideration of all the implications, economic and social. The Finance Bill this year is being introduced not merely after an extended gap after the Budget and the normal time, but also after the election and for that reason some of the normal aspects of it may have been deferred until this stage, but at the same time matters dealing with specific reforms of the taxation system and of the structure of our tax code, and particularly implementing recommendations of the Commission on Income Tax, of a technical or other character, should be taken in a separate measure. Some of them have already been dealt with.
There is one aspect of the Bill to which I want to refer and that is the question of death duties. As I understood the Minister, there are to be certain changes. When the decision was taken in the 1965 Finance Act to aggregate, for the purposes of death duties, insurance policies with the rest of the estate, we criticised and opposed this. Subsequently some modifications were made. This was one of the most retrograde steps that was taken and it has imposed burdens on people who have to meet these duties. It denies them the opportunity of anticipating them in the way in which a number of people did, by taking out an insurance policy in anticipation of death duties. That law should be changed. I know that there is a chance to take out a policy that will mitigate or offset the effects but it is a reduced benefit compared with what existed before, particularly in respect of small businesses, small farmers and people with family or other commitments whose capital is involved or invested either in business or in a farm. Certainly the changes imposed here do not appear to meet the needs of such cases and I believe that they should.
Mr. J. Lenehan
No wonder, when all the gang behind the Deputy are fast asleep.
When the Bill was introduced here before the election the Minister went into quite a lot of detail in the White Paper and in the speech which he read today, I notice that, like the wise man he is, he gave a very bare minimum of detail, simply quoting sections of the Bill rather than going into detail about the matters which he had covered. This, I suppose, is one way of preventing people who have not either the time or inclination to go deeply into the matter from taking part in the debate. It is perfectly legitimate, I suppose, and we cannot complain too much about it but, in view of the fact that the Budget was described by the Government as an election Budget——
By the Government?
By the Government.
You said it was.
I occasionally have time to glance at newspapers. I saw the smiling face of the Taoiseach listening to what he claimed were the items included in the Budget for which, in order to ensure that the people who were to get them would get them, they must return Fianna Fáil. Do not say now that it was not an election Budget. Do not say that you are not claiming that it was there for the purpose of getting votes, and votes you got by using it.
I suppose we did get a few votes on it.
I suppose you did. I wonder for what other reason you could have got them. On the evening of the Budget a number of matters were discussed here and the Minister will bear with me when I try again to refer to them because I feel that, if we keep it up, eventually he must take cognisance of what is being said and must make an attempt to remedy matters.
First, let me list the old thorny one which the Minister knows as well as I do, that is, the question of the personal allowance. Is it reasonable, in 1969, to include a personal allowance for a single person plus £15 and for a married couple plus £30 on what was fixed away back in 1961? I gave particulars here on a motion last November showing that when the arrangement was first made for the introduction of PAYE, in 1961, the personal allowance was then roughly £6 10s— £6 5s a week and the insurance made it £6 10s. Maybe the Minister could explain why he considers it sufficient to give an additional £15 to the single man or woman on that. In view of the fact that agricultural wages or wages in rural areas at that time for, as they are called, unskilled workers, were around that figure, and, therefore, they could draw a full week's wages before they became taxable, why does he consider that in the year 1969 it is in order to tax them on approximately £5 10s to £6 per week? Does he believe that the cost of living has gone down or does he imagine that they are now able to live on that or does he believe that the increases they were getting were too much and that the State should take some of it away? I do not think the Minister realises that when an ordinary worker gets £1 per week increase, such as was granted or promised recently, the Minister, through them tax collectors, will take 5/3 out of that £ before it is handed over to the worker.
It was 25/- actually.
The 25/- has not come. I am talking about what they got and I will talk about the 25/- in a few minutes. There is 5/3d taken, so that they get 14/9. Of that official £1 a week, the State gets 5/3d. The result of this is borne out by the fact that in 1960-61 PAYE produced £48,800,000 and last year, up to 31st March last, the figure had increased to £69 million. Where did the increase come from? The increase came from the pockets of the lower paid workers. They are the people who are paying the maximum amount of tax.
The Minister will remember saying, not once, but several times, in this House, when asked to give some concession to these people, that he agreed that they had a good case but, on one occasion, he said it would cost too much and, on another occasion, he said it would be too much trouble, which I assume was the same thing. There are too many small people being taxed and, therefore, to give them a tax concession would cost too much. The tax concessions should have been brought up when the wages were being increased. There is no reason why there should not have been an increase in the personal allowance. There is every reason why the personal allowance should have been increased every year.
These increases that we are giving, small though they are, will take 30,000 people out of the net at the lower level.
The Minister, I am afraid, is living in 1960-61. I do not care who tells me it will take 30,000 people out of the net. There is nobody now working at a wage of £6 10s per week——
The £15 and the £30 that we are giving in this Bill will take 30,000 people out of the net.
It cannot do it. It cannot take any of them out of it. The Minister must understand that if the tax free allowance is £6 10s no matter what way you count it, you add your £15 extra to that and you get £6 15s.
The Deputy is mistaken. You add the £15 and the £30 to the single allowance and the married allowance, respectively.
Eventually, it is the same thing.
The £6 10s only means that anybody earning that or less does not go into the tax net at all, is totally out, but by adding £15 to the single allowance and £30 to the married allowance we will take 30,000 people who are now paying tax out of the net.
For a week or two, until the next increase comes.
In effect, what the Minister is saying is that this extra £15 or £30 will bring 30,000 people into the position that their income will not be taxable.
I do not wish to interrupt the Deputy. The only point I am making is that the Deputy was talking about the lower paid people.
I am still talking about them.
I am merely pointing out that there will be 30,000 of that type of persons at the lower end of the scale who at the moment are paying some tax, usually a small amount of income tax, who will not be paying any.
The only people, if there are such people, will be people who, because of certain commitments, are being brought pretty close to the tax level but the ordinary person paying tax in the normal way will still be paying tax and the remission of the extra £30 or £15 will be only shillings per week. The Minister, I am sure, will agree with me that that is so— it will be shillings per week extra that they will be entitled to earn. As you know, I am a trade union official and it is my job to deal with these people every day of the week. These people are living on a subsistence level, many of them below it. I do not think the State has the right to take from these people money which they require to live. I do not think it is just or morally right.
Take the question of the 25/- that the Minister referred to. Of course, again, that 25/- was discussed before the election and there were certain arrangements to be made. The State was to have 25/- paid from 1st June and £1 from 1st October to certain categories of workers. I do not know whether the Minister is aware of the fact or not but discussions to iron out to whom it should be paid have not yet taken place. No arrangements have been made to have discussions in order to straighten out the matter. Certain officials are working pretty hard to find out what category they can squeeze out of this increase.
In addition, it was promised that local authorities were to be brought in; the managers were to be brought together and they were to be told that this was a national arrangement; that it applied all round; that provision was made in the Budget for the money and, therefore, it was all right. What happened? The managers were brought in by one Minister who told them: "The negotiations for local authority workers' wages are made by the managers; I am not telling you anything except that this is what the State is doing. Go back and talk to the trade unions". Is that not a very different story from the one we were told before the general election when we were informed that it would be 25/- from June and £1 from October for everybody? Now that the election is over there are second thoughts. I do not know whether the Government consider this to be a clever way of doing things but I do not think it is.
Whatever agreement I made will be adhered to.
The trouble is that the Minister made an agreement——
Not a promise.
The Minister made an agreement and said: "Look, this is what we propose to do." However, what the Minister proposed to do has not been done and I will go further than that and say that there are certain sections of people who should operate this agreement but who have no intention of doing so. The Minister's colleague who met the county managers —I got a copy of the circular the Minister sent to the trade unions—makes it quite clear that he does not interpret it in the same manner as the Minister for Finance.
The Deputy need have no fears whatever. What I agreed to with the public service committee of Congress will be adhered to to the letter.
I shall hold the Minister to that promise when the time comes. In fact, I have a question down which should come up during the week and which should reveal what progress has been made.
The Deputy need not bother to put down a question. I am to be found in my office and if there is any problem arising, the people who made the agreement can come and see me at any hour of the day.
The people who made the agreement made it as trade unions representing the workers and I happen to be one of the people they were representing at the discussions with the Minister and I am now asserting that the agreement made has not been implemented so far. Perhaps, the Minister will say that it does not matter if these things can be put back for several months.
I do not say anything of the sort. I am not at all aware that any agreement is not being implemented and if the people with whom I made the agreement have any cause for complaint I will see them tomorrow morning.
Perhaps, the Minister will say when he is replying to the debate if he is aware of what has been done since he had the discussions with the trade unions because I know that when we tried to get discussions with some of his Departments we were told that the matter was being considered. It took two and a half years on a previous occasion to consider some things which were supposed to be cleared before the Minister's advent to the Department.
Reference has been made to the question of income tax in respect of wives who are working. It is most unfair to tax a woman on every shilling she earns more than the limit of 30/when she must go out to work because her husband is not earning enough to keep the family. This is very unreasonable and I do not think that anybody with any sense of justice could tolerate it. This arrangement applies even to those women who do seasonal work in hotels or holiday camps. They will be told that they will receive an adjustment at the end of the year and sometimes they succeed in getting some of the money back but very often they do not succeed in getting anything back. This is something that requires attention. As I said here before, those people who have plenty of money cannot see why anybody should complain that he or she has not enough money to carry on but there are thousands of people in this country who are finding it extremely difficult to carry on.
I have in my pocket a letter that I received today from a woman who tells me that she is earning £6 5s a week and she points out that she is taxed on everything over 30/-. She wanted to know if I considered it fair that she should have to hand back more than 30/- per week to the State out of her £6 5s. I certainly do not think it is fair. Another issue which has been mentioned is the question of overtime. I do not know whether it is generally known that workers with rather poor wages have a great reluctance to overtime work when they find that they must give 5/3d out of every £ to the State. It may be said that this money is required for the purpose of running the services of the State and that the money must come from somewhere. However, people who work so hard— I personally believe that people who work overtime earn their money very hard because they are already tired after a day's work when they start overtime—consider that it is far too much to expect that they hand back 5/3d in the £ to the State. This has the effect of leaving these people at the flat rate instead of the overtime rate which they had hoped to get.
One example of this which comes to mind is the question of married nurses. Many married nurses will not work in hospitals in spite of the fact that there is a great need for them because of the amount of income tax they would have to pay out of a relatively small wage. I am quite sure that the Minister, as well as I, has sympathy with these people but the only difference is that he is in a position to do something about it. There is no reason why he should not do something about this matter.
The Minister has also referred to the exemption from income tax of the earnings of artists. I do not wish to go into that but there are a few aspects of it which strike me as being peculiar. The Minister says:
...the Revenue Commissioners have long been accustomed to seek expert advice on pictures, writings and other works of art...
Who will make the decision?
Normally, there will be no decision because most of the people will be clearly recognisable as artists. This only refers to marginal cases.
If they are recognised artists that is all right but if they are not this way of deciding may not be the ideal way. Some people have said that this exemption may bring in people from outside but I do not think this will happen.
I do not consider the increases in social welfare to be quite so wonderful as some people seem to think, not even as wonderful as those people who were influenced by the progress advertisements in the newspapers before the election seemed to think. I wish to go on record as saying that no matter what Government was returned to office those benefits at least would have to be paid. It was most unfair and, indeed, grossly wrong for anybody to try to blackmail unfortunate people into thinking that they would not get the increases unless Fianna Fáil were returned to power. I was amused at one statement that Cumann na nGaedheal took 1/- off the old age pensioners. This was used as an argument, but nobody asked who was the Minister for Finance then or what party does he belong to now. It might embarrass the Government.
He was not in our party.
Earnán de Blaghd? Of course, he is a member of Fianna Fáil.
The Labour Party took in so many "quare hawks" recently that I would not be surprised if they took him in also.
He has never been on a Fine Gael television programme in his life.
Be careful that the "hawks" do not catch you.
He is not a member of the Fianna Fáil Party.
He seems to be in the intellectual wing of Fianna Fáil. It is good to see the question of the shilling being taken away raised again and then to see the fellow who is responsible for this under the wing of the Fianna Fáil Party.
I personally have nothing against the individual concerned. He is not a member of Fianna Fáil.
He is, unless you got rid of him in the last few days.
He was never a member of Fianna Fáil.
He was. He appeared on television programmes and declared his belief in and allegiance to Fianna Fáil recently.
That is a different thing. There are 700,000 people who believe in Fianna Fáil and who voted for us.
Not quite. The exact figure is 630,000 people. Two days before the general election notices were sent out to all recipients of social welfare benefits giving them the glad tidings that they would get money on a future date. They were also sent stickers for their books. Such a move might be good political tactics. Would it not be a great idea to have broken a precedent and to have sent them a few shillings and have explained that as the extra taxes had come on from the day of the Budget that they were going to get their increases immediately, perhaps, even on the day of the election? Could the Minister for Finance not do that? The Minister just showed the "promised land" and told the people that they would get more money in August if they lived that long. This is an example of cheap political tactics which only Fianna Fáil could think of.
Fianna Fáil gave nothing to the old age pensioners for 16 years from 1932 to 1948.
The former Minister for Education got tangled on that, and he would want to check on his facts. Deputy B. Lenihan mentioned 2/6d per week, and in that he was almost as wrong as the Minister who said 10d a week.
I was looking at Deputy Tully that night and he was wrong in what he said. The Deputy was factually wrong.
Anything I say is usually wrong, according to Fianna Fáil. The Minister for Finance did not even brief his colleague who was to appear on television. He thought it was 10d a week. It was 10d per day.
The Minister for Finance thought there was a crisis on the 10th May.
The Labour Party had a crisis on the 18th June.
There was a crisis in Wexford on the 18th June for a few people.
No, there really was not a crisis. Somebody has to lose, and the Deputy lost once.
Wexford has unpleasant memories for us all.
Sorry about that.
There are some reasonable things in the Budget and the £100 remission for a disabled spouse is a good idea. The Minister was very definite, when speaking the other day, that there is a big improvement in the change-over to the necessary machinery for decimal currency. The tax remission on the money being spent on the change-over will not do the trick. The Minister might like to look at it later on and find out whether, as we come nearer the time, it is going to have the effect which he thought it would.
The Minister might clear up a few points for me. Was I wrong when I said that the children's allowances are being taxed for the first time? I was not. The Minister for Finance has arranged to tax children's allowances. We could all agree on such a tax if only the very rich people drew children's allowances. The proposition is framed in such a way that certain pretty poor people will now find themselves paying income tax on children's allowances.
No.
The Minister can explain that again, when he is concluding the debate. I challenged the Minister previously about increases in the cost of social welfare stamps. Is it not true that the cost of these stamps is to be increased by approximately 3/- per week? If that is so, why was that not mentioned in the Budget? Why has it not been officially mentioned to date? We all know the answer to that. The Minister should say to people that the position is that although they are looking forward to getting a few extra shillings through the remission of the £30 and £15 that they will realise it is being taken off under another heading.
The question of the increase in the tax on what was referred to as luxury goods is rather amusing if it was not so serious. The Minister for Industry and Commerce, Deputy Colley, referred in the Budget speech to the fact that only luxury goods were being taxed. I asked him did he include radios under that heading. The Minister said "yes". I asked the Minister did he include motorcycles and he said that workers who wanted to use motorcycles to go to their work could buy secondhand motorcycles which are not taxable. Deputy Colley is not quite "with it", although he would like very much to be so. If there is one thing a man has to curse it is a secondhand motorcycle. I have had experience of that myself. It is not good enough to suggest to a man who wants to get to work on time and who has a distance to travel that he should buy a secondhand motorcycle and thus avoid the penal tax. Items like that are necessaries and not luxuries. People want to use them and they should not, in my opinion, be subject to extra tax. A few years ago the then Minister for Education, Deputy B. Lenihan, was telling people in Roscommon that the turnover tax would only apply to luxury goods. He mentioned high power cars, furs and jewels. The Minister for Finance did not mention high power cars, furs or jewels, when introducing this tax. This is the sort of thing which is trotted out to people who are being taxed to the ground and yet are being told that they are not affected by the taxes at all. When people come to buy items, they find they are badly affected by the taxes.
Unfortunately, this year the tourist business is not as profitable as it was previously. A number of reasons are given for this. One cause which is repeated again and again is the price of drink. I met a couple of Englishmen recently who had come over here and who intended to go on a good binge. They went into a pub and asked for pints of lager only to be told that they were 3/7d here, whereas in England they can be bought for 2/6d.
The price of a pint of lager is 4/- now.
It may be that price next week. The high price of drink is one of the things which is doing harm to our tourist business. The second harmful fact is the price of food. Of course, if taxation keeps going on as it is then everything, including the price of food, must go up. The Government are trying to give the impression that they are introducing a Finance Bill for everybody and that they are, in fact, according to the brief which the Minister read out today, giving things away all over the place. Actually, when you read down deeply into this you find that it is the usual old Fianna Fáil budget which takes as much extra as it can and covers it up as well as it can. They are robbing the poor to pay the poor.
The Minister's colleague was adamant during the course of a television interview that there would not be a second Budget this year. When a Minister spoke on the Budget the last day he gave a solemn guarantee, as did the Minister on television, that when the debate was concluding the Minister for Finance, who is here now, would promise there would be no second Budget this year. Will the Minister give that guarantee when he is concluding on this debate?
Tell them up in Bonnybrook where you sent out the leaflets.
I did not send out any leaflets.
Fianna Fáil did. You did not sign your name to it.
There is one aspect of the proposal to offer relief in income tax to the creators of literary and cultural works which worries me, having regard to the Minister's statement today. The Minister states that the Revenue Commissioners will look to the status of the individual rather than to any particular work. This would appear to indicate that the person will get relief according to who he is and not according to the quality of his work. This appears to underwrite a conviction which is abroad in this land that it is who you know and who you are which matters, that it is not what you are and what you can produce which matters. It would be most undesirable, even in the interest of doing what is worthwhile achieving, that we should give statutory recognition to the notion that it is the status of the individual rather than the quality of his work which will confer benefits on him.
That is not what I said.
The Minister said that they will look at the status of the individual rather than to any particular work.
I said any particular work. In other words, every work a person produces will not have to be examined. Once a person is established as a creative artist, a writer or a composer every work will not have to be examined. The Revenue Commissioners will not have to look at every single thing the person produces.
Once a person arrives he is all right. We understood from the Minister's Budget statement that this was to be encouragement to the young people, that it was to be an incentive to people to engage in cultural, literary and artistic pursuits so that we might have an increased volume and improvement in quality. Instead of providing, as we ought, encouragement to the young we are saying that they will get no reward until they are established.
The Deputy is saying it. Nobody else is.
I am giving a fair paraphrase of what the Minister said today and what is possible under the terms of this Bill.
It is a false and malicious statement in regard to what was said.
What is actually being said is that once a person has arrived and his status is recognised he will get unlimited tax reduction, no matter what rubbish he produces.
The Deputy will always find ground to change around what has actually been said.
The Minister does not know much about artists.
I know more than the Deputy.
We are now saying that once a person's status is established, once he has a picture exhibited that he will get this tax reduction, despite the fact that we know of examples where people succeeded in producing rubbish after they were established. We know many artists have done so even after they showed great promise. Some of them never lived up to the promise they showed on the first occasion. One can certainly understand that it might be difficult at all times to achieve as good a standard as one did at the beginning but the whole nature of the Minister's remarks today and the proposals in the Bill are not to give encouragement to people when they are climbing up, not to give encouragement to people who are endeavouring to produce works of quality but rather to compensate those who have achieved what is called status. Who will give the individual the status which is to allow him the haven of non-payment of tax? We are told it will be the Revenue Commissioners who will do so on receiving advice. Advice from whom?
Deputy Paddy Belton.
We are told that we have already been receiving advice in relation to the value of paintings for some years past. It would seem to me that people who are not satisfied with the decisions of the Revenue Commissioners will be processing their complaints through our law courts. We will then achieve the strange situation in which law judges, who are not qualified to test works of art, will be adjudicating on the decisions of the Revenue Commissioners, and they will be judging those cases presented to them.
What about Lady Chatterley's Lover.
I know nothing about Lady Chatterley's friends. Perhaps, the Deputy might like to tell us more about his companions. We are told that encouragement will be given to works of cultural and artistic merit. Could the Minister state if it is proposed to extend this benefit to the makers of films? It seems to me that if encouragement is to be given to some people who produce works of artistic and cultural merit similar encouragement should be given to the makers of films which in many respects must be tested by the canons which decide whether or not works are of cultural or artistic merit.
We can appreciate, of course, that the income from films for most people is not so great as to make them liable for income tax arising out of filmmaking but we have good reason to be proud of the number of Irish citizens and people living in Ireland because of the extremely good quality of their film work. If we are now going to confer this benefit on some people engaged in cultural and artistic pursuits it is desirable that we should bring within the ambit of this benefit people who are engaged in the modern media.
I support the remarks made about the utterly inadequate tax allowances given to married women. I support them not only because of the humanitarian reasons already advanced but also because of the argument that the allowance of 30/- a week is meaningless in relation to present day values. But I advance also as an urgent consideration the serious disincentive which present tax liability is to married women working at all. There are many industries and employments in Dublin which are suffering seriously at present because of the non-availability of women workers. Even in cases where the domestic circumstances of women are such that they could, without any disadvantage to the family or themselves, engage in employment, the women will simply not come forward to work because the tax liability imposed on them is such as to make the effort not worthwhile. I am sure the Minister must himself be aware that there are many industries with a large proportion of women amongst the employees which are working under capacity because women workers are not available to them. On that account, I was rather surprised that there was not a substantial concession given to married women in respect of their earnings. I believe that this is justifiable. So far as the women themselves and their home circumstances are concerned, I think it is necessary so far as our industrial production is concerned.
We in Fine Gael welcomed already the partial relief given to purchasers of their own homes. It is a total relief in relation to new houses which qualify for the State grant. In relation to those houses, it is simply another way of increasing the grant. I suppose, in relation to the total cost of a house, it is very small indeed. Nevertheless, it is a welcome one. We can appreciate that any Minister for Finance has difficulties in giving any concession because of what it costs. It seems unfair not to give relief of a similar nature to purchasers of previously occupied houses. One of the reasons a great deal of house property in this city fell into decay was because the legislators failed to recognise the need to make the ownership and occupation of older buildings attractive — failed to give the incentives necessary to property-owners or potential property-owners to maintain older property in good condition. It seems to me that the giving of tax relief of the stamp duty of £50 or thereabouts to the purchaser of a new house may well act as a disincentive to people who might otherwise buy a previously occupied house.
Already, there are other disincentives operating against the purchase of previously occupied houses. Auctioneer's fees in many cases have to be paid at a level which, in Ireland, is much higher than operates in other countries and legal fees have also to be paid at a level equivalent to what operates in other countries. Legal fees and auctioneer's fees on previously occupied houses are, in all cases, a great deal more than are applicable in relation to newly-built houses. In many cases, where older houses are purchased, they are such as entitle the purchasers to receive from the State and the local authority some grants for the purpose of repairing them— grants which cannot exceed £240. Again, these grants are inadequate in relation to the cost of repairs and maintenance of house property at the present time. But, if the State has seen fit to give a concession in relation to stamp duty on new houses where the State grant applies, I think it should also be possible to give a relief from stamp duty in cases of previously occupied houses which would be such as would entitle the owners to receive repair and improvement grants.
For many years, the rateable valuation of £19 was taken as a fair standard by which to judge the suitability of houses for the housing of the working class. We have now very properly departed from that undesirable description. However, I think we might consider relieving from stamp duty houses of a lesser rateable valuation than £20. Alternatively, I think we should relieve from stamp duty houses of a lesser market price than £4,000. I personally would have preferred to see the Minister giving complete freedom from stamp duty to all property of £4,000 or less which was for the purpose of habitation rather than to give the concession of another one per cent to houses in the £4,000 to £6,000 bracket. I can appreciate that a decision in relation to these is probably affected by two factors: (1) the cost of alternative allowances and (2) one's personal preference. My personal preference would be to give the total relief to people purchasing houses under £4,000 rather than to give a partial relief up to £6,000.
The stamp duties are only a small portion of the cost of acquiring property. It seems to me that the State ought to take some steps in this country to put a limit on the fees earned by auctioneers. In other countries, there is a sliding-scale applicable to auctioneers' fees so that the higher the cost of the property the lower the percentage earned by the auctioneers. Here, alone in Europe, I understand, we maintain the same scale of fee irrespective of the value of the property which is passing from one hand to another. This is something, I think, on which the State ought to move. If the Auctioneers' Association will not, of their own accord, fix a scale which is on a sliding basis then I think the Minister for Finance should step in to tax earnings which are not related to the amount of skill or endeavour or application on the part of the auctioneer.
The Minister in his statement today commented on the wholesale tax on certain less essential goods in a manner which seemed to me to indicate he did not consider it was of any great significance. What I think is of significance is the unfair aspect of requiring our people to pay this substantially increased wholesale tax on a variety of goods from 7th May, 1969, without conferring any social welfare benefits until 1st August of the same year in some cases and until 1st January, 1970, in other cases. Not only has this wholesale tax to be paid by all the people in respect of whom it is supposed to be levied for the purpose of conferring social welfare benefit but, in addition, people who are working and who are insurable will be required to pay an additional 3/- a week in order to pay for the benefits which will not come until over three months, in one case, and almost nine months, in the other case, elapse. This appears to me to be very wrong.
I think that the State should certainly endeavour to close the gap between the levy, imposition and charging of a new tax and the conferring of benefit. It is surely wrong to require payment of tax for eight months of the financial year for the purpose of conferring benefit in respect of the last four months of that year particularly when, at the time the new tax is imposed, we are told there is a need to increase the social welfare allowances. Here, we oblige people to pay the imposition and we do not confer benefit until it is too late. The Minister may say that the items he selected for payment of wholesale tax are not such as will normally be purchased by people on whom benefit will be conferred. That is not so in relation to many of the people who will be receiving an increase in their contributory pensions as from 1st January. Such people are not properly subject to a means test and many of them will, in the previous seven months, be paying on a range of items and it is not fair that they should be required to pay for so long before receiving any benefit.
We consider that the new provision in relation to the building of new ships is to be welcomed. If we in Ireland are to engage in a shipbuilding industry we need to give a great deal more assistance than we have yet given. Other countries are giving additional assistance through a variety of means which are not available in Irish shipyards. From time to time we have seen criticism, understandable criticism, from people engaged in the shipbuilding industry here of Irish concerns which are purchasing ships abroad but a number of these concerns are under a statutory obligation to purchase their ships at the lowest price which is commensurate with efficient building and they cannot avoid placing their orders in foreign shipyards. I know that a number of these concerns are most anxious to give the work to Irish shipyards but until such time as the State gives to the Irish shipbuilding industry all the incentives which are available elsewhere there is the likelihood that further orders for shipbuilding will go abroad and, indeed, further orders for ship repairing. Anything, therefore, which is done by way of giving assistance to the Irish shipbuilding industry is, I believe, well worthwhile and something which we on the Fine Gael benches are only too glad to encourage.
May I initially on behalf of the Labour Party likewise assure the Minister of our general approval and support for the innovations in his speech this afternoon? Most of the provisions—the social welfare increases, the limited relief given to house purchasers, the exports relief, the general tax exemption given to creative writers and so on—are by and large welcome. Like the previous speaker, we envisage a fairly hilarious case history of adjudication on the part of the Revenue Commissioners in their attempts to define creative writers as such. Nevertheless, it is welcome that their literary elevation has come about and that possibly the only spark of real innovation in this year's Budget goes in that direction. I do not particularly agree with some of the more silly remarks of Deputy Ryan in that regard.
As regards the statement generally, one of the more disturbing aspects of the general analyses of both Government spokesmen and of some of the Opposition spokesmen in relation to this Bill and in relation to the introductory statement made when the Budget was originally presented was the general failure, in my opinion, to try to reflect and respond to the quite dramatic changes that have taken place in the occupational structures, in population structure, in the structure of the economy as a whole particularly over the past decade. While it may appear to be somewhat mealy-mouthed on our part to comment on that I feel that one must, in the debate relating to the Finance Bill, display some sense of political objectivity and that one must at least acknowledge the tremendous changes that have, in fact, taken place, changes which, quite frankly, are not necessarily reflected in the method and form of the Budgetary accounting system now operated in the State. This is something which should give quite considerable cause for concern to the Minister and his colleagues. Certainly this is a feeling which I have in relation to what exactly has taken place in the past ten years.
In relation to the First Programme for Economic Expansion and, indeed, the Second Programme for Economic Expansion, although by no manner of means can the changes be attributed directly to those programmes, nevertheless, they occurred in parallel, it is true that during these periods the economy has expanded something like three times as fast as it did in the 1949-59 period. This must be acknowledged. The two periods, 1949-59 and 1959-69, are quite separate and distinct in terms of political development, in terms of economic development and no particular correlation of political developments can be taken from these periods. Nevertheless, this expansion has occurred. There has been in the Irish economy a real measurable increase in our living standards over this period even if it has not been as widely spread and as spread in as egalitarian a manner as we in the Labour Party would wish it to be but certainly this has occurred and I think one of the major difficulties now facing the economy and particularly facing the Minister is to try to correlate that into the Budgetary developments in the years ahead, particularly to try to assess whether it is worthwhile having this yearly circus of an annual Budget and so on and doing it in a very conventional manner with the usual show attached to it which has been the occupational hazard of all Ministers annually in the Department of Finance.
Perhaps, it is long overdue that this form of annual Budget should be more sharply overhauled and brought into the alignment of 1969. I welcome in the Budget itself—and, indeed, this has been reflected very much in the NIEC reports available to the House, not necessarily read by the Members of the House; the vast bulk of them I feel are not read by the Members of the House—the continued export relief given by the Minister to exporters in this country because we in the Labour Party acknowledge that our future prospects for economic growth in the country and for a rising level of employment whatever prospects there are, certainly lie almost exclusively in a massive effort on our part to maintain and to increase industrial exports. Indeed, the measure introduced by the Minister will be welcomed by the 50,000-odd workers engaged directly in export industries in the country.
I feel though that the Budget does not sharply underline the need for other measures designed to increase exports in this country. In that context I would classify it as a somewhat conventional Budget. Admittedly, CTT have brought in a new scheme for the general diversification of exports but nowhere in the Minister's statement is there a general introduction of special Budgetary measures relating to adaptation and so on which one would have expected now that Ireland has emerged very strongly as a major exporting nation. I certainly would hope that in the years ahead these types of budgetary innovation will be brought in as they have been brought in in most of the European countries as in Britain where the Chancellor, by every possible means, has tried to stimulate, through financial measures, special incentives for the exporting industries themselves.
There does not seem to have been in the Minister's statement any particular analysis of one of the major revenue-gathering sources in the country and the future role that taxes on motor cars and road fund revenue might be likely to play in the years ahead. For example, when I came to Dublin first in 1957 there were roughly about 125,000 motor cars in the whole of the State. Today there are 350,000 registered vehicles in the State. Yet, year after year the Minister imposes piecemeal taxation——
The statistic that surprises me is that the Deputy only came to Dublin in 1957. He seems to have been around for a long, long time. I cannot remember an election without him.
Yes, indeed, and I hope to continue. Certainly, the Minister in the context of future Budgets could take into account that even in the past ten years—to take another period, 1959/69—the number of registered vehicles has grown from 154,000 to 350,000 and yet we have the conventional introduction year after year of piecemeal measures relating to this, one of the major aspects of revenue. Indeed, in terms of differential taxing of motor cars, there does not seem to be very much reaction from the Minister in many of the measures that he has brought in on these occasions.
Another aspect which is worthy of consideration is the whole of the future tax structure of the country. The Budget has ignored the major employment changes that have occurred. Referring to the Second Programme for Economic Expansion as long ago as 1963 when he was Minister for Industry and Commerce and was speaking to the National Productivity Committee seminar The Taoiseach said in relation to the projected figures under the Second Programme, that “these stand as a watershed in our economic development and if events follow the pattern forecast we will find for the first time in our history a greater number of people being employed in industry than in agriculture, forestry and fishery combined.” Then he spoke about the revolutionary impact of this on the Irish labour force. Yet one finds in Budget Statements year after year that these major changes have not been, by and large, brought into account. I suggest that it is overdue that the Minister should try to analyse the dramatic impact that these changes would have in the next ten or 20 years in terms of income to the State and, in particular, in terms of long-term and budgetary forecasting of the State itself.
There is also the Report on Full Employment. One is not quite sure whether the Government have ever accepted it. Certainly, its fate is like that of the Buchanan Report and other reports. Quite frankly, the Government found it politically expedient to sidestep the full implications of these reports and not have them discussed in public and certainly not in the environs of the Dáil. In regard to the Report on Full Employment by and large, on a given set of assumptions that are not being challenged in any very authoritative manner, it assures us that by 1980, ten years away, we shall have 107,000 fewer people engaged in agriculture and that in industry we shall have 168,000 more people employed.
I am asking the Minister if there are currently any studies being made within the Department of Finance, or Revenue, or within the projected budgetary income, of what the likely out turn might be from these particular figures. Otherwise, we shall assemble here on the yearly circus, as I have said, analysing the Budget and being not quite sure what is going to emerge from the slot machine of next year on the basis of the annual figures given to us. This is a serious matter which should be considered by the Minister.
I also suggest to him that there is possibly a necessity to revive and bring once again into operation the Commission on Income Taxation which, to his credit, Deputy Sweetman established. I find very little in Irish economic history to give him credit for, but I give him credit for that much. That was one of the major commissions in our history; it modernised the whole structure and system of income taxation. It now goes without saying that the basis of taxation policy is long overdue for general review. I think it was in February, 1957, that commission reported. They held a very large number of meetings — well over 140 — and well over 50 committee meetings. The general recommendations of that commission were taken sufficiently seriously by the Government — we got White Papers in response—that perhaps during the lifetime of this Dáil, rather than driving ourselves into political insanity, rather than bemusing ourselves with the predilections of the Minister for Justice in relation to the Criminal Justice Bill and so on and having all-night sittings on the kind of arrant authoritarian nonsense he goes on with, we could instead devote some time to the country's taxation system. Then, perhaps, we might emerge in four and a half years' time with some lessening of the general disenchantment about Dáil Éireann—a disenchantment I certainly felt and from which I have not yet necessarily recovered since my entry into this House.
I should certainly hope, therefore, that the Minister would revive in any other form he wishes the Commission on Income Taxation. Frankly, I hesitate to suggest a Select Committee of the House because such committees seem to have a rather notorious history. I think this could be a useful innovation in the lifetime of this Dáil. The present system of taxation, as we in the Labour Party find it—we have told the Government enough of the general feeling about it—is neither fair nor particularly just. We have repeatedly said that, while wage and salary earners must pay income tax on their earnings to the very last shilling and have a PAYE number stamped indelibly and irrevocably on their backs for the lifetime of their industrial employment, there are still open various devices of evasion, various means of tax-avoidance, over the whole range of income taxation, whether it is turnover tax or any other schedule one cares to mention.
Revenue is certainly being lost to the State. Even though in practice that revenue may be quite marginal — it probably is quite small—it has given rise, particularly in the major urban areas, to a great sense of injustice on the part of wage and salary earners and, perhaps white collar professional people who are caught in the PAYE net because they feel they are bearing a burden of taxation which is neither fair nor just. The Minister could give such people some prospect of equality if he were prepared to set up a general commission to review current practices in that regard.
It may not be very popular to say this in this House — I have no doubt I will be crucified for it at the chapel gates at which, in the next by-election, the Minister cares to speak — but it is time there was a review of the taxbearing capacity of certain sectors of the agricultural population. I see the Minister being rather coy about this, but this is no anti-rural bias on my part. This is the kind of pious nonsense Fianna Fáil have gone on with in relation to the income tax capacity of certain sections of the agricultural community. I suggest to the Minister that he might usefully set in train some working party to try to broaden the tax base of the country in a manner which would not impose an undue burden on small and medium sized farmers but which would certainly bring in the land ranchers and land speculators in rural Ireland who have — and they are immensely grateful to the Minister— succeeded in having themselves exempted from the normal social responsibility which most of us have to bear. This is an aspect of tax levying systems which the Minister should seriously consider. This is quite outside the partisanship and the general political party propaganda which I have no doubt some of the Minister's colleagues — I exempt the Minister in many respects from that — will avail of when they read the Official Report.
Likewise, I think the Minister should take a sharp look at the turnover surpluses of some of our co-operative groupings. Again, one will be denounced for making the proposition. When one reads in the newspapers of the revenue of the Cork Marts, of Ballyclough, of Mitchelstown and of various other aggregates of co-operative societies throughout the country— many of which are somewhat remote in some respects from the Minister's concept and my concept of what co-opera-tives are—tax reforms cannot exclude such massive developments in the State in the context that private enterprise is obliged to pay corporation profits tax and these other sectors of the community engaged in trade and business are exempted. I do not suggest that the co-operative societies, playing such a very crucial, vital and necessary role in economic development, should have any undue burden on them, but I think they bear a share in the general taxation system of the country.
On the question of tax reform, I do not think that the Minister needs any special reminder on the need to introduce a land development tax. It was brought in in Britain; it had its teething troubles, but it is an important innovation to ensure that people will not benefit from the sale of land which might be utilised for the provision of hospitals, schools and so on. It is essential that such a measure be brought in. It would accord with the general wishes of the NIEC. It would accord also with the attribute of the Irish people to the effect that people will not get away with substantial capital gains for their own economic benefit through transactions in land.
In many countries such a system is in operation and I do not think it is beyond the Minister's capacity or that of his Department to have such a measure introduced as an essential element in the broadening of the tax basis itself. We have had references to the introduction of a capital gains tax in stock exchange speculations and other such transactions. Such a system is in operation even in the US—this arch approach to private enterprise is in operation in many areas there. A similar measure should be introduced in the Republic.
I hope there will be a fairly sharp analysis by the commission suggested, and, whether the Minister likes it or not, of the added value tax, for instance, an outline of which has been laid before the Oireachtas. It might be siphoned to the commission. They could examine it in an objective and impartial manner and that operation would give that body a useful operational basis on which to work. The turnover tax has been in operation since 1963, a considerable period, and it has not been subjected to an intensive review. The staff who operate that tax might be consulted on the method of its operation because they have wide experience of it. On the other hand, the wholesale tax does not require any investigation because of its comparative newness.
In Ireland, there is an exceptionally high proportion of total taxation taken by way of indirect taxation. This is an added reason why there should be an immediate examination of the system. Taxation on expenditure represents as much as 68 per cent of total taxation and, taking any European country, this is a uniquely high proportion of personal taxation. It has been referred to in the FII report, among others—68 per cent of total taxation coming indirectly——
I am not clear on the point the Deputy is making. Is he talking about personal taxation or indirect taxation?
I am talking about the percentage of taxation accruing from indirect sources generally.
Indirect?
Yes. It is exceptionally high in the Republic relative to other European countries. In Sweden and Switzerland it runs to a percentage of from 30 to 50 at maximum. There are a range of European countries to which the same applies. Comparatively, it is exceptionally high in this State.
They are the aspects of taxation which we feel are worthy of consideration by the Minister. There are other aspects of national budgetary matters which are equally worthy of the Minister's attention. I hope I do not sound patronising, but there have been periodic reviews by the NIEC, beginning in 1964. There have been broad implications and general propositions but these have not gone past the general discussion stage. In the context of a Budget debate, it is important that consideration be given to the views of such an authoritative body outside the Dáil who have continued to produce reports. Something more should be done than to condemn such reports and recommendations to a limbo or a shelf of the Dáil or of the Government. It is important that the Government should endeavour to take cognisance of the recommendations of this body in regard to budgetary matters. There has been a recommendation not only of the NIEC, but also of budgetary experts of OECD in the February OECD Observer of this year. They recommended:
A basic requirement for the formulation of fiscal policy is the correct appraisal of current economic trends. In a number of countries, official economic forecasting is little devolped and has not been intergrated into the budget process. Most countries could profitably improve upon, and add to, the use of resources devoted to the tasks of economic forecasting and analysis including improvement in the scope, accuracy and timeliness of basic economic statistics.
Although the NIEC might assume such a role it would not in the slightest relieve the Minister or the Cabinet or, indeed, Dáil Éireann, of any of their responsibilities. The point I am making is that far more recognition could be given to the recommendations of these expert bodies on many occasions.
They are some of the points I wished to make before passing on to the social welfare aspects involved in this Bill to which the Minister referred. Special palliatives were given to them in this year's Budget. I suggest that the Minister should get together with the Minister for Social Welfare with the object of bringing in a system of wage related benefits and contributions. It would be a beneficial introduction and would be a large revenue gathering exercise for the State. It would modernise social welfare, something which is long overdue in this country. Unless and until this development occurs, we are wasting our time every year giving 5/- or 10/- per week by way of benefits and adding on 9d or 10d per week by way of backing up social welfare contributions. There should be consultation between the two Ministers and the Irish Congress of Trade Unions in an endeavour to devise a fair system of wage related contributions and benefits, which could be given effect to in the Budget.
Such a proposition will not cause any great alarm in the country. It has been so long overdue that one wonders how in recent years the Government have been otherwise so preoccupied. Certainly they have had plenty of opportunity over the past 12 years to do so, and this is one recommendation we would make strongly to the Minister.
I would also urge the Minister—if I am talking at undue length it is because I feel strongly on many budgetary aspects—to make a statement, not necessarily in reply to this debate on agricultural subsidies in respect of which we are facing a very difficult period. In his November, 1968, speech the Minister was quite explicit, quite emphatic about the massive support required from the Exchequer for milk subsidies. It does appear that, unless the Cabinet gets to grips rather urgently with this problem and reviews the form of subsidy, the extent of subsidy, the manner in which the immediate requirements for future subsidies based on the existing system are going to be obtained from the taxpayer, then we go again into the merry-go-round of farmer agitation, taxpayer reluctance to pay and general mayhem in terms of the economic management of the country. In November, 1968, you said in your introductory speech that in 1968 about 520 million gallons of milk would be delivered to creameries.
Would the Deputy address the Chair?
I do not think I said anything here in November, 1968.
He was not here.
The acting Minister.
I extend my apology. I am glad to see the Minister back. The Taoiseach, then acting Minister for Finance, stated in the House that of the 520 million gallons of milk delivered to creameries, 200 million gallons would be consumed at home, mainly as butter, and all the rest of the milk must be exported in some form at a loss which increased steeply with the quantity exported. In 1968 it was stated that about 240 million gallons would be exported mainly to the United Kingdom and the cost of these massive exports was mentioned. I think the Minister is in for an extremely difficult period in relation to milk subsidies unless there is a very sharp review made of the national capacity to bear the major subsidies that are now required and to which the Minister and his Cabinet are committed. As regard the need for reform and the particular measures which will be introduced, after 12 years I do not propose to advise the Minister on the particular measures, the changes and the realignment which are certainly necessary. However, it is going to be rather difficult in the years ahead to devote increasing revenue of the State to social projects, to the major demands of the health services, to the major demands of housing and of the general capital programme, if these extreme demands continue to exist in the major sectors of the Budget. Even if the Minister feels that the present policy won the election in rural Ireland—as possibly it did—no doubt in the sober, post-electoral period this problem will give cause for serious Cabinet concern.
Again I suggest, not out of any sense of negativism but of necessity, that as Deputy Cosgrave indicated in his speech, there should be a sharp review of the impact of the Anglo-Irish Free Trade Area Agreement. This is rather hackneyed and has been proposed to the Minister more than once, but now that we have had successive ten per cent cuts from 1st July, 1966, and now that the impact of the tariff reductions is becoming apparent and certainly will be more apparent by July, 1970, and bearing in mind that of the 180,000 people in manufacturing industry in the country, only about 40,000 of them are exempt from the impact of these tariff reductions, I do suggest to the Minister that it is time for a review of the operations of the Anglo-Irish Free Trade Area Agreement. The British have been keeping it under very close surveillance and I doubt if the Minister or that naïve Republican, the Minister for Industry and Commerce, Deputy Colley, who wants a factory in every townland notwithstanding the Buchanan Report, is prepared to make a full review of the operations of the agreement to date. This is something which is well worthy of consideration, and the 50,000 workers in the export industries and the workers directly affected now by the tariff reductions will be concerned to ensure that this review does take place.
One aspect which is encouraging in relation to the agreement has been the relative success of both the Government's attitude and the CTT's development programme in relation to to diversification of exports. It is not without significance that there has been considerable progress generally in the diversification of exports. It has not been by any manner of means as much as we should have liked in the Labour Party in terms of getting us away from excessive dependence on the Free Trade Area Agreement but, by and large, it has been a measurable success. In 1968 exports to non-UK markets were estimated at £125 million, whereas in 1958 the figure was only quarter of this amount. This is the result of the new scheme of diversification by CTT and I have no doubt that in the years ahead this approach of the CTT and the exceptional work done by the staff of this organisation will lead to greater achievements.
I have met many of them at the annual export review meetings and so on when I was in the Irish Congress of Trade Unions, and I have generally been impressed by the ability of the staffs of this organisation. Given the necessary freedom by the Government—I do not think they have been unduly hampered in their activities—I have no doubt they will succeed in diversifying Irish exports to a degree where we shall not be excessively dependent on the outcome of the Free Trade Area Agreement. However, this does not eliminate the necessity to have the Free Trade Area Agreement reviewed in terms of alternative strategies as quickly as possible.
Deputy Ryan and Deputy Tully referred to the development of the tourist trade in relation to the Budget. This is of major importance, particularly when one considers the alleged reduction in tourist traffic in Ireland at the moment. I would strongly recommend to the Minister and to the Minister for Industry and Commerce — I have no doubt Deputy Belton will take note of this as well— that there should be displayed in all licensed establishments, not necessarily illuminated with searchlights but certainly available to the general public and particularly to tourists, a price list so that nobody will be under any illusion as to what is being charged for drinks in every lounge and bar in the Republic of Ireland. I have received some complaints from tourists. On the Continent and certainly in the United States, it is common practice to display a price list, and when anyone goes to buy something he does not have to depend on a count of his change to find out what price is being charged for a particular commodity. Therefore, the Minister could address himself usefully to this proposition, and it will not do the licensed trade a bit of harm; indeed it will help the staffs and everybody else concerned. These are some of the things worthy of consideration.
I noted in the Minister's Budget Statement very little reference to the general allocation of State funds to new industries and funds in relation to adaptation. That pattern was repeated in the Minister's speech today. I suggest that until such time as the Government make up their minds where they stand in relation to growth centres, particularly in relation to the Buchanan Report, a great deal of the work of the Industrial Development Authority and of the projected expenditure for new industries and for the adaptation of established ones will be frustrated. The Government are well aware that some six years ago the Committee on Industrial Organisation strongly recommended that the Government should make up their mind on the question of the development of growth centres. Likewise, the NIEC has made emphatic recommendations to the Government in that regard. Yet, repeatedly in Government statements and in the attitude, in particular, of the Minister for Industry and Commerce we have seen no clear-cut statement of intent on future prospects of the implementation of the Buchanan Report.
As the Minister is well and truly aware, in Northern Ireland for the Craigavon and the other industrial growth centres it was the Government which designated the areas and put up the infra-structural cost and allocated the moneys. They faced up to the decisions. Even though those decisions were unpopular in certain areas, they, nevertheless, faced up to them and succeeded in giving the initial impetus to economic and industrial development in Northern Ireland. That impetus is painfully lacking in the Republic, I regret to say. These are the problems which, I hope, the Government will face up to in the years ahead. In Northern Ireland there is a permanent secretary in charge of new industries. I do not think our Government have solved their own problem of internal responsibility because this vital development of internal growth centres has not yet been allocated to a Minister of State. The Government can from that aspect be faulted in terms of internal strategy. I pity many of the major industrial undertakings in our State, such as Roadstone, who are not in a position to plan five years ahead in terms of this development.
We have available the report of the committee on the development centres and industrial estates. That report was published in July, 1964, after the committee and working party was set up in September, 1963. Yet, for a solid five years, the Government sat back and did nothing in terms of a definitive approach to this problem. In relation to the allocation of budgetary finance to this form of essential industrial development the Minister could certainly usefully decide where the money will go, where it will be allocated and the manner in which it will be allocated.
Deputy Tully dealt with the social welfare aspect and I do not think I need elaborate any further on them. However, I think it is very necessary to dispel — I am not embittered because it does not pay politicians to be either bitter or silly; that seemed to be the opinion of Deputy Ryan in regard to the electoral responsibility of the people though, one would imagine, he would have reached a greater maturity in the years he has spent in this House— a certain atmosphere that was created by the Taoiseach. The Taoiseach was intellectually dishonest in suggesting there was in operation here a social security system equal to, or on a par with, or superior to other régimes—that was the expression he used—in Europe. If the Taoiseach would spend 20 minutes on a trunk call to any European state, to Northern Ireland, or to Britain, he would very quickly discover that our social security system is very far from all that it was alleged to be in the recent general election. This is an aspect to which the Minister could usefully advert when he comes to reply.
There are other aspects I should have liked to deal with, such as an incomes policy and so on, and the failure of the Government to ensure an effective system of industrial training. We lag very far behind Northern Ireland, Britain and other European countries. For a country with such great ambitions in regard to industrial exports it is a matter of profound concern that we have failed lamentably to avail of the unrivalled opportunity to establish, in the context of budgetary policies, manpower developments of a very advanced nature. We have separate and distinct educational developments of a wide variety but we are, nevertheless, ten years behind. Britain has 20 industrial training boards and 15,000,000 workers are now undergoing training while we are just getting off the ground. The Minister can feel far from complacent about giving export reliefs because, in the final analysis, it is the skill of the workers which will determine what will leave the country in terms of both quantity and quality. I hope the Minister will indicate his desire to reform the budgetary structure, apart from the innovatory spark with regard to creative writers. I hope that he will not give us once again in 1970 an exercise in conventional budgetary wisdom. I am quite certain he is more than capable of giving us something better than that when he sets his mind to it.
There are three things which I particularly regret have not appeared in the Finance Bill. First of all, there is no provision for tax remission for people who incur very heavy travelling expenses going to and coming from work every week. Neither is there provision for alleviating the position of many people earning extremely low incomes and who under our regressive tax system still have to pay income tax. There is no new provision in this Bill to prevent non-nationals from acquiring vast tracts of land. I hope that at some future date something will be done in respect of these matters.
In relation to travelling expenses, people who incur very heavy expenses per week in paying for their transport to and from work should be given a remission on their income tax. There are many people in my part of the country who travel 30 or 40 miles to work in Dublin and very often they have to travel by private transport because the bus services in their area are quite inadequate. This expense knocks a very big hole in their weekly take-home pay. In view of the fact that the housing situation in Dublin is far from what it should be and, therefore, people cannot find accommodation in Dublin, and in view of the fact that it is cur policy to develop growth centres and to encourage people to travel long distances to work from these centres, and also in view of the fact that there have been substantial increases over the past ten or 15 years in the price of petrol, then in order to facilitate these people and put them on a par with people who have to travel only short distances to work the Government should consider giving them complete exemption on travelling expenses above a certain amount in relation to income tax.
There has been a precedent in this regard in relation to medical expenses over £50. I do not know if the sum over £50 is exempt but certainly it is taxed at a much lower rate. Some similar provision could be introduced in relation to travelling expenses and thus ensure that people who live in the country would remain there and would not be forced to live in sub-standard accommodation in the city. These people should be able to stay at home and go to work in the city every day, thus preserving local communities. If we introduced some form of exemption for high travelling expenses we would do much to ensure that people remain in these rural communities and ensure equality between different workers.
The fact that people earning £6 15s 0d a week, or people earning something more than that, should be paying income tax is a tremendous blot on a Government which claim, rather spuriously, that they are a Government of practical socialism. Whatever the cost, taxation in relation to people on very low incomes should be used as an instrument for social justice. The fact that under this Government people earning £7 a week have to pay income tax is a fair measure of the Government's concern for social justice; it would be more accurate to describe it as their total lack of concern for social justice. As a minimal interim step this allowance should be raised to at least £8 a week.
The third point I wanted to raise was that many non-nationals are acquiring large tracts of land, very often in areas in which there are many people who want land from the Land Commission and who could work that land usefully. Yet the land is being taken up by people who previously had no stake in the country and are accumulating this land and by pushing up prices are preventing local people from buying land. I do not think that anybody objects to non-nationals coming to live here and buying a reasonable amount of land to enable them to farm but what we do object to—and I speak for most people and most farmers in my area—are non-nationals acquiring large tracts of land.
I would make a tentative suggestion how this could be prevented. At the moment there is a 25 per cent levy on the purchase of land acquired by non-nationals and I suggest that this levy should be raised to 50 per cent in respect of all purchases in excess of 300 acres. This would prevent or discourage people from acquiring large tracts of land and to some extent would also prevent some of the ugly occurrences which there have been in relation to property and so on. If some effort along those lines was made to prevent foreigners from securing large tracts of land we could look forward to a much more peaceful situation in the country and it would also reduce the substantial expenses incurred by the gardaí and the inconvenience caused to them by having to guard estates of non-nationals in anticipation of an attempt being made to interfere with them. This would also ensure that local people would be able to get land at a reasonable price.
As other Members from these benches have said, we are in general agreement with the increases provided for social welfare recipients. In some measure they will offset the increases in prices which have occurred as a result of the Budget and, indeed, of the turnover and wholesale taxes. These taxes affect the poorer sections much more than the organised sections who are better able to look for increases when they see their standards of living being eroded. A steep rise in the prices of essential commodities in the past few years made it necessary for the Minister to give these somewhat substantial increases in social welfare benefits. If no action is taken to stabilise consumer prices, then the Minister will have to come back again with a Budget, be it in November or in April, and give further increases in social welfare benefits.
Section 2 of the Finance Bill has intrigued quite a number of people. The Minister has asked us not to be unduly critical of his efforts to give relief to creative artists, sculptors and musicians. He hopes by this to create in this country a haven for artists and musicians. Some questions would have to be asked of the Minister in this connection. What, for example, would be the loss in revenue through this provision? The tax burden falls proportionately more heavily on a minority of the community since there are more old and young and unemployed in this country, percentage-wise, than, say, in Great Britain. Are we to add another section of the community to those persons who do not contribute to the tax fund? There are many people who are making a living through their own efforts and they have to pay taxes.
There is also the question, are non-nationals to benefit through this concession? Will they simply come to Ireland and set up house for a few years and then gain the benefit of these exemptions? Recently there was a statement in one of the evening papers to the effect that a member of a wellknown pop group was to set up house in this country. I suggest that an individual who would do no credit to this country may come over here and evade quite a considerable amount of tax in Great Britain as a result of the provision which the Minister is introducing.
The Minister also stated in introducing the Bill that the relief is mainly directed towards established composers, sculptors and painters. I would suggest that perhaps the young struggling artist might also be given some relief when he too gets some income through his efforts.
The rises in prices in recent years have had, as has been said by other speakers, a detrimental effect on one of our largest industries, the tourist industry. Since I represent one of the tourist counties — Wicklow — I am naturally concerned that the increase in prices may, as we have seen from recent figures, be pricing us out of the tourist market. Already, there are some depressing figures coming to hand as regards the number of visitors to this country, particularly from Great Britain. People, it seems, are finding it just as cheap now to go to the Continent and perhaps, when they know they are—I shall not say guaranteed— at least, more assured of better weather and lower prices there, it will certainly become less attractive to them to come to Ireland.
I would say that Bord Fáilte have not helped this country by their misguided advertising in the British press through the smaller circulation but more influential Sunday newspapers, such as the Sunday Times, which get to only a small percentage of the British community. I would appeal to the Minister to keep a very watchful eye on the effects that this is having on our tourist industry.
Once again, the old reliables, as the Minister has described them, fell in for increased taxation, namely, beer, spirits, tobacco, petrol and oils. It is rather curious that petrol and oil should always be referred to in the same breath as beer, spirits and tobacco which, in whatever other way we may describe them, are the great luxuries whereas petrol and oil are items which are becoming increasingly part of everybody's budget and of everybody's essential spending. Nearly everyone nowadays has to commute between his home and his place of work. The increases in petrol and oil are having a very adverse effect on the price of CIE fares. In many parts of rural Ireland it is essential for persons going to work to use cars and to purchase cars and the very steep increase in the price of both cars and petrol has become alarming in recent years. The price of most smaller models of cars has increased by almost £50 in the last few years and the price of petrol has increased by almost 2/- in the last three or four years. I would ask the Minister for Finance to keep a close watch on these items because I think he is pushing the price of them to the point where diminishing returns will come into effect, with consequent loss of revenue and adverse effect on several industries, such as the tourist industry, particularly in rural areas.
In conclusion, I would say once again that we basically are in agreement with the provisions which bring much needed relief to social welfare recipients and I would reiterate my appeal to the Minister to do something about the steep rise in prices which is taking place and, also, would ask him to bring in some measure which would help to keep prices down in the next year and to level out the steep increase which has occurred, particularly in the price of consumer goods, in the last couple of years.
Even though there are very welcome provisions in the Bill, the measure is more notable for its omissions than for what it contains. Speaking as a rural Deputy from a tourist county—County Kerry—I must say that there is great concern there at the moment in regard to the number of tourists coming into the country and as to the way the few who are coming in are being channelled into the country. It is about time that the Minister for Finance or some Minister took another look at the recently announced tie-up between Ryans Tourist Holdings and Aer Lingus. Certainly there are many people, I am sure not alone in Kerry, who have put hard earned money into guesthouses and the extension of small family hotels who are now feeling the pinch.
It is entirely wrong that the State should subsidise certain companies such as Ryans because once a tourist arrives either at Shannon or Cork or Dublin he is immediately provided with a car by Ryans and his bed is booked for him, whether in Cork, Kerry, Galway or Dublin. I would appeal to the Minister for Finance to take a very close look at the situation as it is developing.
Anybody in the tourist business knows that this month of July is one of the worst ever months for tourism in this country. Many excuses are being put forward—the trouble in the North, and so on—but the nice position that Ryans find themselves in now is that they can have a package deal, keep you in any of their hotels for £28 for a fortnight and give you a car and book your bed on your flying in from Birmingham. All this is done for £28. There is not a hope for the small guesthouse or the small hotels. It is time the Minister for Finance stepped in and relieved the position.
There is another aspect of the tourist industry. Recently a number of valuation officers were seen travelling up and down the country. Where any guesthouse happens to have a sign outside the door and, perhaps, a new roof and newly-painted doors and windows, the valuation officer goes in and the house is immediately revalued. In some cases the valuation jumps from £15 to £20 or from £7 10s 0d to £13. Everybody knows of the high rates that have been struck—£5 in the £ in Kerry and over £5 in Mayo and £4 15s 0d in Donegal. If this trend is to continue the small man will be driven out of business and I wonder if it is not the intention to drive the small man out of business.
I agree with what Deputy Burton and the Labour spokesman said about travelling expenses. I agree with them that there should be a relief in income tax for this purpose. I wish to stress the point also that in tourist counties such as Kerry, Wicklow and Wexford there should be an allowance for digs money. In those areas, the cost of digs is increased during the season by at least 50 per cent and sometimes more than 100 per cent so that board and lodgings may cost up to £6 or £7 and that is a lot for those lads who only earn £8 or £9 a week.
With regard to grants by Bord Fáilte for hotels I would suggest that when an hotel is being built a certain number of houses should also be built for the personnel who will work in the hotel. Those unfortunate workers are being exploited and one often finds that three or four of them live in one room. The housing conditions for these people are nothing short of being chaotic. Bord Fáilte have a duty to the country to see to it that one of the conditions attaching to a grant for an hotel should be the provision of houses for the people who will be working in the hotel.
Regarding the Land Commission, I am greatly disappointed at the way in which the Commission has worked during the past few years. Farms that have been taken over by the Land Commission are still not divided after five, six and even seven years. During an election campaign one often finds the local Fianna Fáil TD telling the people that they will get some of the land which is held by the Land Commission but the land is still there undivided by the time the next election comes around. There should be some clause to the effect that if a farm is not divided within at least two years, a commission should be set up to examine the reasons why the Land Commission failed to divide the farm.
It is very wrong that we have a situation in which small farmers are anxiously looking over the ditch at a Land Commission farm while a rancher can come along and give so much money to the Land Commission for the grazing rights of the farm for 11 months. I might also add that when that grazing is being let, priorities are given to certain people. That is entirely wrong. There should be a public auction for the grazing rights of those lands when they are being offered to the public.
Speaking as one who has been associated with greyhound racing for a long time, I appeal to the Minister to have another look at the tax on the admission charge to greyhound tracks. The attendances at greyhound racing are falling off. Everybody knows that a large number of rural people enjoy greyhound racing. It is part of our pastimes and I, therefore, appeal to the Minister to do whatever is possible to bring about an exemption from this tax and to put the money towards prizes for those who are keeping the dogs.
Finally, I would also appeal to the Minister that in the case of anybody who wishes to develop his house so that he may keep one, two or three people there, when the plan is submitted they would be told that their valuation would go up by 30/-, £2 or £2 10s. At the moment, people are afraid to develop or extend their houses for the purpose of improving conditions and supplementing their income in a small way because of the fear of what the increase in valuation might be.
I find myself in the extraordinary position of having to make an accusation against the Minister for Finance, an accusation which I never expected to make, but from the evidence of this Budget, the Minister obviously hates women. I ask the Minister to tell us why he is so vindictive towards women in this Budget and why he appears to hate married women?
Of course, what I am referring to is the complete inadequacy of the tax relief for married women who go out to work. The time has come in this country when there is a block to development because there is so little encouragement for teachers, nurses and other skilled people to go back to work because of the rate of income tax for which they are liable. Very often these are highly skilled people who have a great deal to contribute to national development but they are being discriminated against. They often stay in homes which they would rather get away from and use their skill and knowledge in contributing to social well-being but they do not do this because of the small amount they will receive after income tax has been deducted. From the point of view of gaining for the nation the value of the training that a great number of married women have received, I urge the Minister to see that there is a drastic upward revision in the allowances for married women in regard to income tax relief. I urge the Minister to do something about this now and not to hold it up for another four years so that he can do it with a flourish at the next general election.
I wish to comment briefly on what one might call the brilliantly orchestrated second section of Part 1 of the Bill which is related to so-called work of artistic merit or creative work. I notice that the Minister confines the categories to words or music or painting where there is an end product. This seems to me to introduce a rather invidious distinction among creative workers. Because we have in Ireland a very great theatrical tradition, it seems worthwhile doing everything we possibly can to encourage and develop this tradition. To my mind, a person who recreates a part on a high level in an artistic way is doing as valuable and cultural an action as a person who writes a poem or carves a piece of sculpture. Anybody who lives in or near Dublin is aware of the huge numbers of young people who have made an immense contribution to the theatre in other parts of the world, young people who have had to leave unwillingly because of all the hardships of the artistic community. I speak with personal knowledge of the hardships of people who are trying to make a living by cultural activities in Ireland but of all these people those engaged in the theatre are the most numerous and the most hard up. Not alone does the Minister appear to hate married women but he also dislikes actresses, but if he does, he ought to overcome his dislike and extend the scope of this section.
This is a section which has been made fun of, improperly. It is a section which will provide some difficulties of interpretation and administration. Indeed, it is not beyond the wit of the Minister's servants to contrive methods which will be reasonably just and workable in order to decide who is to be put in and who is to be left out. This thought about people in the performing arts prompts me to say that there is one other obvious section here where the end product is a finite thing. It is just as finite as a painting or a piece of sculpture, or a novel, and that is where the end product is a film. We, in this country, have an internationally recognised ability with words. We have creative writers beyond what the numbers of our population would indicate. We have very considerable theatrical talent also. We know in terms of international industry that we have the good fortune, in this context, of our speaking English which is the language of the largest markets in the world.
We know we have all the conditions for film-making in terms of locations, and in terms of expert personnel who have been gathered together by the setting up of a television station. We have writers and actors. We have all the objective conditions for a successful film industry which in terms of revenue and employment in the country, and the projection of the awareness of the country, would be of immense international value. I know the Minister is aware of this. Would it not be desirable to extend the inducements which are included here towards books and plays so as to cover films also? It seems to me an invidious distinction to say that a novel is a work of culture, of art or of creation but that a film is not. Many films have already been produced by dedicated people in this country and these films are undoubtedly works of art. There is an unfair distinction here. An extension of the scope of what is an imaginative and constructive thought of the Minister in the way in which I have urged would not alone be good for our theatre and film industry but would also carry out more effectively the intention which the Minister obviously possessed when he framed this section. It would not present difficulties of application which could not be surmounted fairly readily by the Minister's servants.
It is very appropriate that we should start the term of the Nineteenth Dáil by discussing one of the final measures of the Eighteenth Dáil, a measure which in its selectivity and in its provisions points the way to what we hope will be the achievements, particularly the social achievements, of this Nineteenth Dáil. The Finance Bill which we are discussing this evening gives legislative effect to the provisions of the Budget. It does more than that. It outlines the fiscal policy of the Government for the next four years, as the Minister said in his statement. It clearly defines the principles on which the social policy of the Government will be implemented. It introduces many new desirable principles in certain aspect of Irish life which are becoming increasingly important as our economic environment develops. The Minister has said that the purposes of this Budget and of this Bill are to eliminate poverty and injustice and to bring everybody along the road to greater prosperity and fuller life. Consistent with this principle, the benefits of the Budget and the benefits which we are discussing in this Bill have been accordingly applied in the areas of greatest need. The revenue and taxes raised have been raised on those sources best equipped to meet them.
I should like to make a few brief comments this evening in connection with the taxation system and the levelling of this taxation. It is very clear that there is an introduction of the indirect taxation system in this Bill which we are now discussing. The Minister indicated in his Budget speech that the three-tier system of taxation— which applies to the turnover tax, the wholesale tax and then the wholesale tax on selected luxuries — could be readily introduced in any indirect taxation system. On this broad base these proposals are highly commendable. In the course of a debate such as this it is impossible, and inappropriate, to argue the merits and demerits of various taxation systems, but there are some points which warrant some consideration from the social and economic point of view. So far as our concern in this legislation is to ensure that the lower income groups are brought up to a greater measure of prosperity, while at the same time ensuring that the higher income groups pay their appropriate fair share of the services that must be provided in any enlightened community, there is always under the system which we have at the present a certain inequity and imbalance directed against the wage and salary earners, and directed in favour of the self-employed, the professional people and the big farmers which Deputy Desmond referred to earlier.
I might indicate to Deputy Desmond that his concern that some of these people at least should be considered for appropriate taxation is not entirely new in these Houses. Any of us who are concerned for the broadening of the scope of taxation in a fair manner would immediately consider that this exemption which some of the larger landowners—I do not necessarily call them ranchers which is a term which may evoke wrong reaction — have enjoyed should be subject to renewed consideration. When one considers that the wage and salary earners are immediately amenable under PAYE to the full burden of appropriate taxation after having been given adequate and due allowances — and here again I welcome the extension of the allowances introduced in this Bill—it would be impossible to argue that others in selfemployment are paying anything like the equivalent amount of taxation in proportion to their income as people on fixed wages and salaries are paying. I do not know enough about taxation systems to suggest that in the present scope of our taxation code this could be remedied. I know that the Minister has over the past few years, made very definite proposals to ensure that the professional people will be subject to a more accurate return of income. Nevertheless, human nature being what it is, ways and means will always be found by self-employed people to avoid the just burden of taxation.
It seems desirable, therefore, in view of the fact that the Minister has clearly stated that our programme will henceforth be particularly directed towards a levelling of income and towards social justice, to extend this programme, which the present Government have always stood for, that this must be on area which we should encourage the Minister to pay particular attention to. I do not believe this calls for any further comment. I think the imbalance is obvious to anyone who considers it even briefly.
An indirect TVA system, if it is introduced in a selective manner, could in some way be used to curb the inflation which has been a problem in this country in recent years. Inflation has been a feature of the increasing prosperity of the country. In its own way it leads to increases in our imports in one way or another. When people feel inclined to buy luxury goods, which are not readily available in this country, they buy imported goods. This inflation could be curbed in the early stages by a selective application of the TVA system. I would hope that it would thereby combine the social aims of widening the net of our taxation and of bringing home to all the people in this country their social responsibility to other members of the community. Many of our wealthier people have no idea of what their responsibility is to people on pensions and people in the lower income group. This would bring home to them that now they are actively participating in this economic and social development.
I hope I am not interpreting too liberally all the signs and indications. However, I hope the House will give the Minister every encouragement in any further extension of this type of taxation. There is also another aspect of the legislation which gives great grounds for new hope and new drive at this time in our national development. We must readily admit, despite what is sometimes said on the Opposition benches, that most of us feel the economic miracle has been achieved in this country. I believe most external commentators would readily accept that fact also. Many of them have referred to it in their highly reputable articles and contributions.
It has always been the concern of the Fianna Fáil Government—and this is particularly evident in this Bill — to safeguard what Americans call, and which has now become a cliché, the quality of life of this country. This is one of the matters which we as a Government, or as a Legislature, must be directly concerned with. Our immediate function is to create a proper economic and social environment but we must also ensure that the artistic and cultural activities and also the philanthropic activities are looked after. We must be concerned with those activities now. I welcome the inducement given in this Bill to those people in these fields. Artists and people of cultural merit will be highly regarded in this country, as indeed they always were, perhaps not in recent centuries but certainly in past centuries. Our artists and other people who contribute something to the beauty of life, to the real essence of life, will now be given an opportunity under this income tax relief scheme not just of developing their own works but also of influencing the environment of our people.
Deputy Keating made a strong case for the inclusion in the group of those who are entitled to exemption, of actors and people actively engaged in the theatre. I am sure the Minister will meet many problems. There is one matter which strikes at the sensitivity of anybody travelling through our city, that is the deplorable quality of the recentlyerected new buildings in Dublin. We recall the great periods of architecture being replaced by the new buildings going up. Those old buildings were of great artistic merit. I do not believe Dublin at the end of the 20th century, if it continues the present trend, will be a place which anybody will care to look at from an architectural or an artistic point of view.
While I know those engaged in constructing those new buildings are possibly most concerned with this matter, it should also be possible for the Minister to consider including buildings of artistic merit or architectural quality in the reliefs he is giving to works of artistic and cultural merit. Some encouragement of this sort could be given, so that our new buildings will add to the aesthetic beauty of our city and of the country as a whole. If help is given in this regard it would arouse the sensitivity of the nation, increase our awareness of these matters and so add beauty to our city. I know it is not possible to do anything this year but maybe some time in the future the Minister might give some grant in this regard. I know the application of this would be more difficult than the application of section 2 of this Bill, but it might be possible for the Minister at least to seek the views of the people concerned with this and who would consider it a worthwhile development in this city and country.
It is a very welcome sign of our new concern with recreational facilities that we are giving this encouragement to artistic works. The Minister rightly said in his Budget speech that, as the economic well-being of the nation progresses, so will it create problems. Those problems particularly concern the effective and positive use of leisure time. People will need, by way of break and relaxation from their ordinary activities, something to fill that leisure time.
This is surely something we must all be concerned about. If our only concern in this House was that of the economic development, the social development in its narrow sense with regard to our social services, if this were our only concern, without having any regard to the environment of the country in which these particular benefits were to be applied, I think, in fact, we should largely be wasting most of our time. Therefore, I would simply say to the Minister that I hope that this start—in what is almost, I suppose, in terms of national revenue, a nominal sum of £100,000 being provided for sporting and recreational facilities—will be extended and that we can expect to see further developments along these lines in the Budgets which Deputy Haughey will introduce, I hope, in the next five, ten, and indeed 15 years.
Also, at the conclusion of his Budget speech, the Minister referred to his direct responsibility as Minister for Finance for the Irish language. He referred to the setting-up of Comhairle na Gaeilge, a new body to advise on the development of the language and the encouragement of its use as extensively as possible and also for the extension of the facilities of the Language Institute of Ireland. Let me just say to the Minister that I think this is one of those factors that can combine in our economic development in a very significant and practical way with the reaffirmation of our national characteristics.
Let it never be forgotten that a nation without national characteristics in these days of international trade—a nation without even characteristic costumes and characteristic products to export to other countries — has little or nothing to offer to other countries and, accordingly, will gain nothing either on the international market or in international repute. Therefore, I would suggest to the Minister particularly to extend and intensify our efforts in this field in as practical a way as possible, as I know it is his intention so to do. He said he is concerned with the practical study of the language and the application of it.
Having had some limited experience of the use of languages in continental countries—and I think this is where it has a relevance to our EEC hopes or, indeed, whatever achievement we may have — it is immediately clear that it must become the ordinary language not just of the school, not just of teachers or of those directly involved in the language but it must become the language too of the pub and of the playing fields. It must become almost the language—as it always was, indeed —of typically Irish invective, abuse, colour of expression that sometimes is very evident in this House in the English language and which I feel should equally be evident throughout the country in the Irish language. Then people will begin to realise that this language of ours we talk so much about is in fact a living medium not just in which you can say your prayers or speak to your former teacher but is one in which you can communicate in the widest possible sense in your everyday environment.
This is not intended to be an Irish language debate but I might relate it directly to our EEC prospects. I feel rather acutely that whatever sound or economic base may be here in this country towards entry into EEC, however well-based our plans may be, the one problem we shall face more and more if and when we do become part of that community—and, even if we do not, in dealing with that community— concerns our basic lack of awareness of the normal daily life and routine of the European peoples. We have been hedged in for a long number of years between two great cultures as they were — the Anglo-Saxon culture and the newly-developing American culture, "cultures" in the broader sense — I had better qualify it because I think there was more to the developments in these countries than just "culture" in the narrow sense.
I feel it is almost a first principle that most Irish homes and families are more immediately aware of life in Britain and America than of life on the continent. For some of us, our only association with life on the continent is a fortnight's holidays maybe every year or every second year. This is not enough. All of us must become increasingly more aware of the nature of life out there; how to communicate with them in their ordinary environment so that we can drive the hardest bargain, seek out the best market and also, basically, even, create our products to suit the style and temperament of the people to whom we are selling them. Here, I would hope that this new development in the language sphere in Ireland, in relation to our own language, could be combined with a practical study of the European languages.
Let nobody tell you that one language interferes with or impedes the development of another. The nature of language itself is such that fluency in one idiom lends itself to fluency in two or three or four or more of them. I would hope that our drive to re-instil in ourselves the ability and desire to talk in our own language in every environment will complement the drive we so badly need, and will so badly need, to speak and converse in the European languages and thereby make ourselves more readily equipped for the development of our markets in those European countries.
A matter that causes some concern —it was referred to by the Minister in passing and I also shall refer to it in passing—is not so much our education as, in fact, what happens to some products of our education. I welcome particularly the new drive towards the development of technological education in this country, the new drive towards the extension of educational facilities to those who are best entitled to them. I see in this the great hope for the development of our markets, for the development of our people. Our market research, I feel, in the spheres of education up to this time, has not been as effective as it might otherwise be. I would hope that the moneys which are increasingly being spent more and more in the educational programme will be applied—again, as the Minister indicated they will be applied —to increasing the funds of young technologists who will advise us and plan for us our entry into other markets and how to achieve the best results in those markets.
It is unfortunate that so many of our graduates who are now so badly needed —it was not always true as, for instance, when I was at university some years ago—still follow the same slavish pattern of going across the water to earn somewhat more while so much more needs to be done and is challenging to be done in this country. I hope that the developments which are again evident from the educational programme—as mentioned briefly by the Minister in his Budget speech—will encourage these people to contribute most to the country that is most entitled to it, namely, their own. I hope, too, that, from now on, we shall stop talking about these poor young people who have to emigrate — these poor chaps who have engineering, architectural and dental degrees. That might have been true ten or 15 years ago but it is no longer true. We should now come to those young men as they are leaving the North Wall for Liverpool or elsewhere and ask them whether they can in conscience leave a country that needs them so much and that has much better opportunities for them. These remarks can, I suppose, be interpreted very loosely as being relevant to the measure under discussion.
With regard to the other aspect of the Minister's proposals—the benefits which are being applied and the revenue being sought to provide these benefits—all of us who are concerned must be very happy. One thing I like is the increasing encouragement given under legislation of this sort to people to provide benefits and proper services for old age pensioners, whether disabled or not, for mentally and physically handicapped people in their homes. An allowance was introduced in last year's Budget which applied to a daughter who had to leave employment to look after an old age pensioner parent. It was extended in this Budget to include a daughter who never could go to employment. I feel that the principle behind this should be extended as fully as possible in any further legislation to be introduced. It could be applied to a wide range of people in need of attention. As yet, income tax relief has only been introduced for the spouse of a physically disabled person. I feel it could be applied to any relative engaged in looking after such a person. I am sure that it is not trespassing too much on the Minister's positive approach to suggest that he should extend that allowance and not confine it merely to a spouse.
The income tax allowance for widows who have dependent children up to the age of 21 if they are still in receipt of education is the type of positive measure which is significant in itself but is much more significant for its enlightened approach which one hopes will be continued and extended in future legislation. After all, the purpose for which all these benefits are applied is the comfort and security of the person to whom they are applied. Any of us who has any experience of people who are disabled or people in poverty or misery of any sort will realise that the best way to relieve this is to provide for greater comfort and security for them in their own homes and in their own environment. I would ask the Minister to keep that actively in his mind as he has done up to now and not to be deterred by any economic factors in extending that to a very wide range. The scope is great indeed.
My final comment on this legislation —I may have wandered a bit widely in what I intended to be a brief contribution—is that this Bill is very significant not just for what it contains but for the attitude which it indicates, an attitude which I hope will commend itself to all sides of the House, an attitude which I hope will not be the subject of niggardly criticism such as that which I heard from Deputy Tully when he asked whether this was the first time that children's allowance had been the subject of income tax. I would probably represent, as would many in this House, the type of person who gives back in tax what he gains in children's allowance. Surely this is something— as the Minister indicated—which is preferable to applying a means test, which in any social legislation must be avoided as much as possible? Surely this type of repayment is a very proper and natural way to go about this? Despite that, facile criticisms of this sort emanate from the House.
I feel that any further measures of this sort, which endeavour to introduce an equitable application of benefits, must be welcomed particularly by those of us, and that includes very many of us in this country, who are being given the opportunities under our finance legislation, under our industrial and commercial programme, under our agricultural policy, to achieve our economic aims. Those of us who have done that with the assistance and facilities given to us by the State, surely, through measures of this kind, should pay it back by way of benefits to those who are most in need? I hope this particular development will continue in many further Bills to come before this House.
It is a pleasure to listen to and to follow an instructive and thoughtful speech of the kind we have just heard, with a very large proportion of which I would agree and I think that would be true of people on all sides of the House.
Before speaking more broadly but I trust relevantly about economic and social matters, I should like to raise one or two points which, perhaps, are more appropriate for discussion on Committee Stage but I should like to raise them so that the Minister may have an opportunity of saying something about them in his reply which might guide us in our approach to the Committee Stage of this Bill.
I have some difficulty in understanding some clauses of section 2. That is not surprising. A Finance Bill which one did not have difficulty in understanding would not be a Finance Bill of the traditional kind that we are used to getting. I wonder if the Minister might is his reply say something to us about subsection (3) (a). Subsection (3) (a) refers to "works in relation to which the Revenue Commissioners have made a determination under subsection (2)". In subsection (2) there are two sub subsections, one of which involves the Revenue Commissioners taking a view of a person in relation to whether he is a creative person arising out of evidence about his work and the other sub subsection is one that concerns itself with the actual individual works of art or literature, the creative works that are involved.
I am wondering whether this determination by the Revenue Commissioners in subsection (3) (a), in fact, relates both to subsection (2) (a) (ii) (II) — I am sorry for the number of figures but that is very much of a sub, sub, subsection or whether it also relates to subsection (2) (a) (ii) (I) because this would affect considerably the interpretation of the whole measure in regard to works of art. It would help us, if we knew what the intention was, to approach this on Committee Stage.
I am also a little concerned about the reference in the same subsection (3) (a), indeed, in the words immediately following the ones I have quoted to "a work of his in the same category as that work". I am wondering how the Minister visualises the word "category" being interpreted. Does it mean that if a work is a work of literature and then another book is written, though, perhaps, on a different topic, perhaps, non-fiction where the first was fiction, that it is in the same category because it is written or does it have to be of the same genre, such as poetry?
No. It means writing, painting or sculpture.
If the person happened to be good at several of these he would have to re-prove his position again in relation to a sculpture if he moved into it from literature?
The purpose of this division is to cater for people who are well known and generally recognised as practitioners of a particular art. They will be exempt straight away. There will be no problem about that. The other case is where a person is not immediately recognisable as an artist or a poet and the Revenue Commissioners may have to ask for the submission of some of his works. That is the reason for the distinction.
I appreciate the reason for the distinction. I think this is a well-thought-out provision in this respect but I should still like the Minister, when replying, to explain perhaps whether the determination referred to in subsection (3) (a) relates to both of these, to the works only or to the works and the man.
Perhaps the Deputy would say what his difficulty is in that direction?
My difficulty is that in subsection (3) (a) there is reference to
...the work or works in relation to which the Revenue Commissioners have made a determination....
What I want to know is whether this refers to subsection (2) (a) (ii) (II) running from line 8 to line 18 where individual works are looked at or whether it also applies to the previous subsection, where the man is looked at but where, in looking at the man in order to determine whether he is a creative artist, his works have to be considered in that context. I wonder whether "determination" in subsection (3) (a) relates to both or only to the second of these two subsections. Perhaps, in replying, at the end of the debate the Minister might like to give us some guidance.
In relation to the same provision about works of art and creative artists, I am a little bothered—and here the Minister might perhaps comment also when replying. In subsection (4) (b) (ii) it is said that an individual making a claim shall in the case of a painting or other like picture or a sculpture, if the Revenue Commissioners so request,
provide, or arrange for the provision of, such facilities as the Revenue Commissioners may conside necessary for the purposes of a determination under the said subsection....
That is fair enough. If a man wants some work of art of his to be allowed for tax purposes and he is not established as a creative artist he must at least submit it to the inspection of the Revenue Commissioners whose artistic judgment would then have to be applied to it. The subsection goes on to say.
...(including any requisite permissions or consents of the person who owns or has in his possession the painting, picture or sculpture).
I see some difficulty here. This could mean that if, in fact, the artist or writer fails under this provision of subsection (4) to persuade the owner of the work of art, who may be in any part of the world, to put it on show for the Revenue Commissioners, then, as I read it, under the last clause of subsection (ii) he, by failing to comply with this request, has invalidated his claim. It seems unfair that the artist's claim should depend on his ability to persuade the person who has bought the work of art to show it to the Revenue Commissioners. Again, it is a Committee Stage point but I thought that if I raised it now the Minister could think about it and make some comment about it at the end of the debate.
It is the sort of power the Revenue Commissioners always rightly look for but one does not visualise that it will ever be used.
I know they always look for this kind of power——
There may be just one single case 20 years from now in which the Revenue Commissioners may have to invoke this provision.
I am quite sure such a case could arise. My concern is that the man should then be penalised because he fails to persuade somebody abroad to open up the doors of his art gallery to show the work of art to the Revenue Commissioners. It is, perhaps, a point for debate later on. I wondered if this is something that must be in the Bill because it seems to be carrying the right of inspection a little further than is practicable.
Section 7 of the Bill extends in a manner which I find obscure — perhaps on the Committee Stage the Minister will explain it—the relief on the amount people pay for health services, doctors, drugs and so on. The problem about this relief as it is at the moment —and I do not think this clause, as I read it, helps very much—is that the relief relates not to the taxpayers but to the person in respect of whom particular payments are made to doctors, dentists, chemists and so on. I have a practical problem here myself and I think most people have. We do not employ different doctors and chemists for all members of the family. We have a family doctor, who from time to time sends in his bill in respect of oneself, one's wife and one's children. He does not distinguish in that bill between those he called to see. Many of his calls, particularly when there is some infection about, relate to several members of the family. Similarly the chemist sends along drugs as requested or supplies them when one calls to buy them and he does not provide bills separately for each member of the family.
It is possible, that if a very careful scrutiny were made of his register and if the doctor in each case was specific about the particular name and not just the initial of the member of the family, that the chemist could, through diligent research, establish for which member of the family a particular drug was supplied. I should not be very keen to impose this task on my local chemist. I suspect he would ask me to change my custom pretty quickly because the profit such as it is—I know it is significant—would evaporate rapidly because of the amount of time he would have to spend in preparing bills and documenting them for me. This, in its present form, is so impracticable that I should like to know from the Minister how many people claimed this allowance. I am in the difficulty—and I have the assistance of somebody with my income tax because I find the problem of dealing with it beyond my own powers — that I find it quite impracticable so far to claim under this heading for the reasons I have stated. I have not been able to extract from my doctor and I have not had the courage to seek it from my chemist the kind of information which is at present required.
The Deputy realises that these provisions were never intended to apply to that sort of normal, routine medicine. The idea was to cover an exceptional illness.
This is my point. Of course, it only applies where, I think, the minimum sum involved for one person is £50. That is fair enough, but if you have somebody in the house with an illness costing £50, which is not abnormal, other members of the family will have had various illnesses during the year also and the segregation of the doctors' and chemists' bills in respect of these is impracticable. I am pretty certain that I am entitled under the law as it stands to make a claim in respect of last year in respect of one member of my family but to make that claim is almost impossible because of the difficulty of getting the information. Mark you, one is required to prove the claim, not merely to provide the information. Anybody who has to prove anything to the Revenue Commissioners will know that it is doubtful if there is any more stringent form of proof required——
I shall ensure that they will take the Deputy's word for it.
The Minister does not know the Revenue Commissioners as well as I do and possibly they know me better than he does. They do not take my word for it. In a case like this they require proof. The Act requires proof.
The change being made now is that up to this it has been £50 for each member of the family and from now on it will be "or £100 for the family as a whole".
My difficulty was that I could not understand the wording of what is here and I wanted to know from the Minister — he has answered me before I had even asked the question with his customary acumen, knowing that I was going to inquire — whether in fact this does remove this difficulty. It does so, although in a manner which may not meet every individual case.
You can qualify either way now either as an individual member of the family with £50 or more, or a total of £100 for the family as a whole.
If this is the case— I wanted to establish that it was the case — this is a definite improvement. The other provision was almost entirely impracticable because of the extreme difficulty of proving what it was necessary to prove to the Commissioners. This therefore does open up some possibility of somebody making a claim and getting some relief under it.
In relation to section 10, Deputy O'Kennedy said that Deputy Tully had said, at a time when I was not in the House, by way of question or inquiry or by some remark implied that he was unhappy about the taxation of children's allowances. I did not hear the remark and I am rather surprised that such a comment should come from such a source. It is possible that Deputy O'Kennedy misunderstood. On the contrary, I welcome this provision. It seems to me absurd that children's allowances should be paid to everybody regardless of means when, without imposing the kind of means test which is so objectionable where it exists in relation to old age pensions, it would be possible to go a long way to change this situation and to ensure that almost all the money for children's allowances goes to those who need it. I am delighted that the Minister has made this change. It is highly desirable.
In the course of my canvass in the general election I was struck by the number of instances in which people put it to me how inequitable the existing situation is. It is not often that we find people complaining that something is not taxed but, in fact, this complaint came to me admittedly, in many cases, from people who were not, perhaps, paying tax, or who were not conscious of being in that category, and who felt that there would be more money for them. If children's allowances were taxed, there would be more money for the allowances, and they would not be hit. Indeed, in many cases they were people who were in receipt of the allowances, who were paying taxes, and who would be hit by this measure. Many of them were not aware of the fact that this was proposed in this Finance Bill in any form and were seeking this extra taxation because of their deep feeling about the inequity in regard to children's allowances being paid to people who are extremely well off, when the amounts involved are so disastrously small that they clearly need to be drastically increased.
The Minister will be aware of the Fine Gael policy on this matter. What we proposed was to allocate over the period of four years in question, an extra 50 per cent in expenditure for this purpose, but to supplement this by this very process of taxing children's allowances so that children's allowances would be increased not by this 50 per cent for which money could be made available reasonably readily over the period, but by two-thirds of the extra amount coming from the proceeds of this taxation. Therefore, I should like to congratulate the Minister on this move. What he has done is, in fact, to recover only a proportion, a fraction, of the amount involved. Perhaps he might go further, not because anyone wants more taxation — none of us want it; none of us paying it want it; I am one of those who suffer from it — but because every £ we get back from people who do not need children's allowance is an extra £ which we can give to people who are in very real need.
I am sure the Minister is aware that our system of children's allowances is one of the particular disgraces in our social welfare system. We are, of course, a poorer country than others near us. Our social welfare provisions are inevitably somewhat less generous but, over and above that, we ourselves do not take this problem seriously enough. We do not, even in relation to our standard of living and our present level of wealth, match the social welfare provisions of other countries with the same standard of living. In no area is this discrepancy more noticeable than in the case of children's allowances.
The Minister is aware that until the recent change was made, a country like Italy whose standards of living and national income per head are the same as ours, had children's allowances approximately five or six times as great as ours. I do not think anyone can justify that kind of discrepancy. It is quite clear that this provision must be extremely expensive in Italy, a country which also has large families. If they, with a standard of living very close to ours, can afford to pay five or six times as much in children's allowances, there should be no problem about increasing ours drastically. I am glad that even belatedly the Government have done this in this Budget. I am glad they have been able to do a bit more than they could otherwise have done by trapping some of the money back again by this form of taxation.
So much for the actual provisions of the Finance Bill. There is much more which we will be discussing on Committee Stage. Those are just a couple of points which occur to me at this stage. There is much in the Bill which we welcome. At the same time, it has the same characteristic as other Finance Bills in recent years, and for many years past. It has a tendency to tinker with problems. There is this new and imaginative provision in regard to creative artists. For the rest, the changes though, for the most part welcome, are not major changes. They do not affect the structure of our tax system and yet there is so much that needs to be done. Each year one hopes that, perhaps, a beginning will be made, and that somewhere at one or other of the sensitive points drastic changes will be initiated, but that does not happen. I know it will not be easy to modify drastically our tax system. It will not be technically easy because any such changes are technically difficult to achieve without disturbance. It will not be politically easy because any significant changes in tax systems must involve as well as reliefs for some people extra payments for others. If everyone pays the same amount after a review of a tax system it is not much of a review. We need to change a number of features in our tax system. The obvious one — and I shall not dwell on it because so much has been said about it not in this debate but in others — is the system of taxation by rates which is carrying a heavier burden than such an arbitrary system should have to carry.
There are other weaknesses in our system. I would commend to the Minister's attention the whole area of estate duties. The amount of avoidance of estate duty is something for which we have no statistics, necessarily, but it is clearly very great. Several years ago The Economist in an authoritative article on the subject in Britain, estimated that the avoidance in Britain was to the tune of two-thirds. I have no reason to believe that the ingenuity of Irish solicitors and accountants is any less than that of those in Britain. Indeed, several even more ingenious devices have been thought up here than in Britain.
The reason why there is so much avoidance is that the tax is haphazard and inequitable. A tax which can fall two or three times within a year or so, or not for 80 years, is so haphazard as to be bound to create a feeling of injustice amongst those threatened with having to pay it two or three times in a short period. A tax which is levied on average every 29 years — the average interval between estate duty payments — is a tax the level of which, when paid, has to be very high if it is to yield anything. It is no good having a tax of 1 or 2 per cent every 29 years. It has to be a tax in the higher ranges, a tax of up to 40 per cent in this country. Indeed, it is higher in Britain and it was higher here until it was reduced some years ago.
When a tax is at the rate of 40 per cent and it is a tax on capital the incentive to avoid it is enormous. It seems to me that we cannot be satisfied with a tax which is so haphazard, and so onerous when it is paid, when there is such an incentive to avoid it and when it is easy to avoid it. It is estimated in Britain that well over half the total amount of tax that should be paid is not paid. It seems to me that the system is wrong and I commend to the Minister the idea I put forward elsewhere of changing this into some system of more regular annual payments, some kind of capital tax designed to yield from the people who are now paying it, the same amount or, perhaps, less, but which would catch as well as those who are now paying it those who do not pay it. If you had a regular tax of this kind it would not be open to avoidance. There would not be the opportunity for avoidance nor the same incentive to avoidance. Something of that kind should be considered.
I know there are problems in valuing estates. I believe these can be overcome. If one were willing to accept a valuation of an estate within the past five years, even though this would mean you would not get the full amount on every occasion the tax was paid, it would be acceptable and it would mean that every estate would be valued every five years only. As there are probably about 5,000 estates in this country only large enough to warrant this kind of taxation — perhaps, there are a few more now but when I last did the calculation it was about 5,000 — this would mean not more than 1,000 valuations a year. I cannot believe that this is impossible to achieve. If we are prepared to put up with an extra bit of administrative inconvenience, I believe the yield from the tax at a lower rate than the tax is today would, in fact, be over double what it is today. I commend that to the Minister as something to consider. There is no reason why in this, as in so much else, we should slavishly follow Britain. We could have a different system here.
There are other areas of taxation where there are obvious inequities. The whole problem of capital gains is a difficult one. We know that attempts to deal with this elsewhere have been by no means uniformly successful but, in view of the scale and nature and source of capital gains in this country, it will have to be looked at in the years ahead. I know the Minister's attention is being engaged by the question of the substitution of an added value tax for the turnover and wholesale taxes. I should like to hear about this. There was a suggestion recently that the Minister's mind is moving in another direction and that he is less enthusiastic about this than he was, and that the Government may decide against it. I should like to know more of the Government's mind on this matter.
I hope the Minister will come to the House and afford us an opportunity for debate before taking any final decision. On matters of this kind a debate in this House can be helpful. It would be a good thing if the style of the Government generally were changed, marginally anyway, by increasing the number of occasions on which the views of the House are sought before decisions are taken, rather than insisting that decisions must be taken first and the views of the House sought afterwards. I do not know why the Government — not just this Government but other Governments and this Government in particular — feel that their prestige is tied up with this idea of taking decisions without consultation and Parliament being told after the event. The Government's prestige would, in fact, be increased if they were willing to open up matters of this kind for discussion before a decision was taken. I commend that to the Fianna Fáil Government as being worthy of consideration.
One other point about taxation generally which I should like to mention in relation to income tax is that our income tax code is one which involves payments in one direction only. We pay the Government. This is not necessarily the best kind of system. Under our present system there is no ready means of redistributing income raised through taxation back to the people unless they are in receipt of some kind of social benefit. If a man is married, has no children and is on a very low income, in poor circumstances, but not in such poor circumstances as to bring him within the benefits of the various kinds of social welfare emoluments, there are no means of distributing income towards him unless he is unemployed or is aged.
The Minister should consider the whole question because we need two different systems of redistributing income. We need a social welfare system by which we can pay out benefits and a taxation system by which the State gets in money. At present we pay out large sums and very large sums are redistributed back by way of taxation. The Minister may be aware that studies have been carried out in Britain into this redistributing process. He will find that at certain times tables have been issued.
There is a typical case of a man with a wife and two children. It shows how much tax he paid and how much income he gets back. The figure given for earnings was £1,250 a year. He was paying £250 a year towards social welfare and getting back £200.
This is an absurd system under which very large sums are raised from people to be paid back again to them. This situation goes to the root of the entire system of redistributing income because if a lot of money is taken from people and then paid back to the same people, with the addition of administrative costs, the mechanism is faulty. If we could leave the money to the people and take from them only the net amount necessary, resistance to higher taxation here would be much less. This aspect is becoming much more important nowadays.
The tax rate here is 30 per cent of gross national product. I do not regard this as an intolerable level of taxation but it is approaching the highest level in Europe, though it is not at it by any means. However, it will not take many years before out taxation burden becomes 34 or 35 per cent of gross national product, a level not reached in any European country with the exception, possibly, of one. At that stage we will get great resistance from the people and that resistance will make it increasingly difficult for us to achieve the redistributive aims which, I understand, we have in principle but which we are slow to put into practice.
Therefore, anything we could do along the lines I have been advocating would be of great benefit particularly now when the level of taxation can become a critical issue. Accordingly, the whole issue of having two separate codes of redistributing income is something we should think about seriously. It has grown up haphazardly during the past quarter or half century. There is no reason why we should have two different systems of distribution and collection which cut across each other.
I commend to the Minister that he should take a radical look at the taxation and distribution system in so far as it affects social welfare. This cannot be done quickly because it might take many years to work it out. I hope he has the imagination — I think he has — to plan ahead and to look at the problem seriously before it becomes a critical one. This should not happen before the late 1970s but at that time we will definitely need a different system.
I wish to contrast the Bill itself — it has many good things but mainly it is a tidying-up, a tinkering measure to a large extent — with the need for such a review which, I believe, the Minister is well equipped to attempt.
I turn my attention now to the economic situation which comes within the ambit of this debate. In a way, it is surprising how little was made of this in the recent election campaign when all Parties were slow to talk about it although it is worrying and is liable to create serious problems for us in the near future. We are now at the point when the Dáil will adjourn in a couple of weeks for some months. Within those months the situation could deteriorate to a level at which the Government will have to take drastic action. Which are the dangers the Government will have to deal with during our absence? That question, in turn, suggests that we should not now confine our attention to the details of the Bill but should expand it to the situation now facing us.
Last year, our balance of payments deficit was nearly £22 million — more than £20 million. It has deteriorated steadily since. I have not got the June trade figures — the Minister may have some preview of them — but for the 12 months ended on 31st May I should think our balance of payments deficit was in the order of £45 million, more than doubled. We have to bear in mind that this is a year in which the tourist industry is not doing well: all the evidence we have for June is that tourism is not expanding as well as we had hoped. The economic situation in Britain and in Northern Ireland has had an effect on tourism not only in Northern Ireland but here, and the increased receipts from tourism which we experienced in other years are not likely to recur this year. We cannot look for a £15 million increase in our net invisible receipts this year. Therefore, our balance of payments deficit, even assuming some improvement in our net invisible assets, will have deteriorated in the first five months of the year and is likely to exceed the Government's estimate of £55 million for the entire year. The latest figure from the Economic and Social Research Institute is £57 million, based on the position up to the end of April. I am not sure either figure is realistic.
However, if the situation continues to deteriorate at the rate it has been during the first five months, more than £5 million per month, the deficit will be more than £80 million for the year. I do not wish to give that out as an alarmist figure because there will be factors which will work as a moderating influence if there is any prospect of keeping incomes under control, which I doubt. Even if incomes do not get out of control any more than the tendency of the moment, the deficit looks like being more than the Minister's estimated £55 million. Indeed, it looks like being midway between that figure and £80 million.
This, by our standards, or by any standards, is a very large deficit. If this were Britain and if she had the same deficit in relation to gross national output, she would consider herself in very bad shape indeed. The British considered themselves in crisis when there was only a fraction of that deficit, proportionate to our gross national output. The reason for this is that Britain is an importing and we are a developing country: we can afford a higher deficit than Britain. However, we cannot take this too lightly and far from suggesting that we should be alarmists, I submit that we are moving towards a situation in which, even if incomes were restrained, of which there is no evidence despite the Government's pre-election forecast, it is highly improbable that the figure of a £55 million deficit will be right. Therefore, we have to consider where this leaves us, especially in view of the position as regards incomes.
I recall being engaged in a television broadcast with a Minister of the Government before the election in which he stated flatly that there was no problem about incomes, that the Minister for Finance's crisis of March had evaporated because of an assurance — I forget the word he used; it was stronger than "assurance"— from the Irish Congress of Trade Unions that incomes would be kept under control. In fact, nothing of this kind happened and the Minister is aware as I am, that the trade unions themselves are extremely worried about the situation. The Minister knows that since the maintenance strike there have been other claims and other settlements and that we are now well on the way to a situation in which wages and salaries will rise in the latter part of this year and into next year at a rate not only greater than we can afford but several times greater than we can afford.
It is not clear what action can be taken and certainly not clear what action the Government propose to take to deal with the situation. If this continues the way it is now going and unless it can be stopped — and I do not readily see how it can be stopped — the external deficit and the general inflationary position could become very much worse than it looks like being on the basis of current trends.
The election cut across this situation. It was unfortunate that the election came when it did. The Minister was, perhaps, alarmist in the way he presented things on television in March and to make his point, perhaps, he overstressed the situation. I do not think this mattered in itself, because it is necessary at times to exaggerate a bit in order to make a point; what mattered was that, having exaggerated a bit at the time he, facing the election, had to pull back and pretend the crisis had disappeared, and the crisis had to be put into cold storage for several months. The crisis is still there and is liable now to re-emerge. Whatever assurances may have been given before the election that there will not be an autumn budget, these are assurances which it may not be possible to maintain in the situation now looming up.
This raises the question as to how this problem is to be tackled. It is not easy to see what can be done in the short run to tackle the incomes problem. The present round is now so far advanced that it is very hard to see how it can be stopped or how anything more can be done to moderate its impact. One lesson of the present situation, which I shall not dwell on now because we have to return to it, is that in the medium term we must work towards an incomes policy, the work which was started in 1965 and which was abandoned because everybody lost interest or became frightened of it or felt they had committed themselves too far on all sides, the Government, industry and the trade unions.
I do not think we can continue to ignore the problem as we have done. In fact, it must be said that there is a great revival of interest in this question and on the trade unions' side and on the employers' side there is a much more responsible attitude, an attitude of concern to achieve something. However, this is not for the immediate future, I stress again. I cannot see, and I do not know anybody who can see, that anything in the line of an incomes policy would solve our problems of 1969 or early 1970 for us. They are outside the control of any incomes policy.
What we can do while we try to cope with these problems is to use the climate of opinion created by this critical situation to make progress in relation to an incomes policy, progress of a kind we should have made after 1965 and which we did not do, and we did not make progress at the time because nobody was prepared to make the necessary effort. On this side of the House I can blame the Government for not taking the initiative, and I think I am fair in doing so, but to be fully fair to the Government let me say they did not get much help from anybody else either.
It is a pity the Government did not take more of an initiative. If the Government had shown more initiative after 1965 they might have brought industry and the trade unions along with them some of the way, but there was a depressingly negative attitude on the part of the Government on the whole question of an incomes policy. They were not unique in that; they merely reflected the climate of opinion in industry and in the trade unions. However, it is not the job of the Government to reflect opinion; it is their job to lead opinion. There was a lack of leadership in this connection. It would have been difficult to lead people in this direction. I am not suggesting the present difficulties could have been avoided if the Government had given a lead but at least we would be more likely to get some kind of order into the situation as we move into 1970.
It is now a matter of urgency and I hope it will be tackled with energy by the Government. It is a problem which will fall into the lap of the new Minister for Labour. I hope he will have the energy and ability to cope with the problem. It will not be easy for him and he will have our best wishes in dealing with this problem and, indeed, I am sure he will have our support on this side of the House in any constructive action he feels able to take in collaboration with the unions and with industry.
To return to the immediate situation, the problem the Government face in the months ahead is, first of all, to decide whether to act at this point in time, by which I mean within the next three months, and, secondly, to decide how to act. I do not suggest that from this side of the House I or anybody else can tell the Minister precisely what he should do. We have not got as much information as he has, and the decision has to be his, based on his knowledge, on his information and his judgment. It is a difficult decision, but there is reason to believe he will need to decide fairly soon if he is going to act or not. I should like to read to the House the concluding paragraphs of the Quarterly Economic Commentary of the Economic and Social Research Institute, which are relevant to this point:
If the foregoing analysis is correct, and the accompanying forecast a reasonable expectation (bearing in mind the inevitable degree of uncertainty) short-term economic management is likely to pose some difficult problems over the next few months. As the forecast indicates, a fairly satisfactory outcome for the year is quite possible. The relatively low growth rate predicted is a direct result of the production lost by the strike, and will (in the absence of a corresponding strike) be automatically compensated by the growth in 1970. The apparently alarming increase in the price level is largely a reflection of price movements which have already taken place, and the implied rise over the rest of the year is not very great. If it is firmly accepted by the authorities that a large external deficit accompanied by a moderate fall in external reserves is a tolerable concomitant of a high rate of investment, and that this strategy will not be suddenly abandoned in favour of safeguarding the reserves, then the external deficit predicted need not cause undue alarm.
There is a paragraph which is fairly optimistic — I think myself unduly optimistic — but then the Institute goes on to say:
...there is little point in allowing demand in money terms to run so far ahead of domestic production capacity that any increase in it can be met only by price increases and higher imports rather than by greater production, and, on the other, that sudden massive restrictions of demand and cut-backs in social investment and expenditure are wasteful of resources and should be avoided if possible.
From this viewpoint the current forecast suggests that the economy is running quite close to the former danger, with little safety margin if present assumptions prove wrong or if unexpected set-backs occur. Given that action, to be effective, has normally to be taken before the full facts of the economic situation are available, a decision will need to be made quite soon as to whether that thin safety margin is adequate.
The point is here that we have a relatively optimistic forecast. This is a forecast of a deficit of £57 million, close to the Government's own estimate. This is not an alarmist document but it does point out that we are right at the edge of real danger, that if anything goes wrong action will be required very quickly. It is a quarterly forecast and I think what the author means to say is that before we have the next quarterly forecast the situation may have deteriorated because of some unexpected change such as the further increases in wages that are occurring to a point where action will require to be taken. It does not require action at this point in time but it makes it clear that within the next three months a critical decision will be needed. If the Government decide to take no action and the situation continues to deteriorate we could find ourselves in the kind of position we were in in 1956 when things were left too long and the action taken then had to be unduly drastic. If, on the other hand, the Government act prematurely and unnecessarily, it could slow the growth of the economy. This is one of these moments when a critical decision has to be taken and when it is very easy to be wrong, and easy, indeed, for us on this side of the House to criticise the Minister if he is wrong.
If the Minister feels that particularly with the growth of incomes there is a real danger, let him not be inhibited by the fact that some of his colleagues were foolish enough to give assurances — he may even have done it himself — of no autumn Budget. There are times when politicans have to eat their words and the safety of our economy and of our economic progress should loom larger with the Minister than any concern that we, on this side of the House, might be able to say: "We told you so." The Minister may have to eat his own words. He may have to take action. Let him have the courage to do so even if it means going back on what he said before the general election.
What kind of action should he take? In the past the tendency has been for this Government — it is arguable that the same is true of the previous Government — to take action mainly affecting the capital side and not to cut consumption to the same degree. I think this policy was wrong economically because of the greater disturbance caused. Perhaps it is even wrong politically because, even though the aim is to avoid disturbing people too much by slowing down consumption and slowing down the growth of purchasing power, the fact is that if one disrupts one's capital programme and causes unemployment in the building industry, and so on, this ultimately has a greater political impact than a much smaller, thinner and more widely spread-out cut in the growth of consumption or in consumption itself.
There is evidence that the Budget last November, open to criticism on many grounds, had one notable feature: it did tend to cut consumption and the Government's policy seemed to be to try to maintain the capital side, to maintain investment and cut consumption. I would hope that that is still Government policy and that, if there have to be cuts, they will be in consumption rather than in investment. As consumption is four times bigger than investment any cut in consumption will have only a quarter impact on consumption as against the impact any cut in investment would have. A quite moderate reduction in the growth of consumption will achieve the savings needed and release the resources required, where to achieve the same result in capital, the whole investment programme of the country, public and private, would have to be disrupted. In so far as policy last November was aimed at cutting consumption rather than investment — I offer no praise of the mini-Budget — to that extent the mini-Budget was on the right lines, although it should not have been necessary and there are other aspects on which I criticised it at the time.
What concerns me now is the evidence that the Government's policy has changed, or someone's policy, because it is not always clear who makes the policy. The Central Bank within the last couple of weeks has issued advice and that advice runs completely counter to the concept of trying to deal with problems of this kind by slowing down consumption. It seems to hit at investment, and investment in the private sector. Last year domestic bank credit increased by £106 million. The Central Bank recommend £66 million for this year. That is a cut of £42 million in the growth of credit. It is a considerable cut. The Central Bank points out that the amount of credit the public sector will need is an increase of £52 million this year, the same as last year, and, when we subtract the £52 million, what is left for the private sector? What is left is that the private sector which last year had £54 million increase in credit, this year will have available, if people do what they are told, an increase of £23 million to £28 million. That is to say, the increase in credit last year to the private sector will be cut by between 50 and 60 per cent. If that is not a credit squeeze then I do not know what it is. It certainly does appear to be a reversal of the change in the pattern of Government policy last November, a change designed to safeguard the investment programme and employment in the building industry.
This could have serious repercussions. This credit squeeze is now beginning to bite and in a manner that could cause serious disruption. I should like to have from the Minister a fairly plain answer to certain questions. Does this cut in credit represent Government policy or Central Bank policy? Does the Minister endorse this policy? There have in the past been certain divergences of emphasis between the Central Bank and the Government. I should like to know if this particular policy is Government policy and does the Minister believe that this is the right thing to do. If so, it seems that he is, in fact, very concerned about the economic situation, despite all that has been said. Is it a fact that the Minister feels we are facing a critical situation and this restriction is, therefore, required? The public should be told. Why is it, if there is need for restraint, that the whole brunt of this has to be borne by investment and, indeed, investment in the private sector? Have the Government reversed their policy here? Is it the case that they no longer feel consumption should bear the brunt? Do they feel that, once again, investment has to be hit? We need the answers to these questions.
It is an extraordinary situation that we now find ourselves faced with serious economic difficulties and with a Central Bank decision, or a Government decision — we do not know which it is — which is of great import and could have very grave repercussions on our economy. Yet, we have no statement from the Government as to whether or not the Government regard the economic situation very gravely, no statement as to why this action is necessary or why they choose to hit investment rather than consumption. The Dáil will adjourn for the Summer Recess and for three months the country will be run by the Executive, without the guidance of the Legislature.
We could always ring the Deputy up.
But there are more than me involved.
I doubt it.
One hundred and forty-four calls would overtax the Exchequer. And Parliament has to meet to consider these things. We are meeting now. That is why he should consider the situation. The Minister has a duty to make a full statement on the position and I would have thought he would have done so on this Bill. Perhaps he intends to do so in reply. The country should be told whether this extremely harsh credit squeeze is the Government's answer. The country should be told why the Government have chosen this answer and what consequences are expected to ensue. We know what happened in 1965-66 when a similar kind of credit squeeze was implemented in the private sector. We know the disruption that occurred at the time. Something similar could occur now. Even without a fresh crisis announcement such a severe credit squeeze is initiated. I have an uneasy feeling that the Minister may be waiting for the House to adjourn before taking certain action. He may even be slightly embarrassed by the Central Bank announcement of its intentions. The Central Bank could not hold back any longer. The fact that the election occurred was unfortunate, but the Central Bank had to give this advice. This debate could be very valuable if we could elicit from the Minister the Government's thinking and if we could help and guide the Minister in the action he should take. I would not presume to guide him as to how to act at this point. The Minister knows more than I do. We have not got the facts. It has to be his decision. If action is required I am unhappy that it may be of the traditional kind, disrupting the economy, when more appropriate action could be implemented. If what appeared to be the new Government policy last November has been reversed, I should like to ask the Minister to reconsider that reversal and consider if, perhaps, the line taken in November was not the better line.
There are two other matters with which I should like to deal. I should like to refer briefly to the full employment report. All of us should re-read that report. I shall re-read it myself during the August holiday period. That report was one which should have been of great importance because it called attention to a dereliction of duty on the part of all of us fundamentally as legislators. It pointed out that the real reason why there is not full employment is because we do not really want it. And the reason we have not got full employment is because we put, first and foremost, and alone, the expansion of our own incomes — that is, those of us who have jobs and can get jobs and others of us who are here — and, so long as that attitude is adopted, we will not have full employment.
As long as priority is given at all times to raising incomes and never to creating employment, never to measures of restraint of incomes which would create employment, we will not have full employment. We do not have full employment because the people who are victims of this are not here to vote. We talked about the postal vote and the postal vote is something which could change the face of this country if there was a postal vote for every Irish born person in America. There would be a very different Government if we had that. It is true that all of us have failed to appreciate the significance of this. All the pressures in politics are pressures for spending money, often for wasting money, or for excessive consumption. The pressures all the time are for increasing costs and making us uncompetitive, to disperse our industries. Every pressure we get, from all sides of the House, is designed to slow down the growth of our economy. If somebody would sit down and thoroughly assess our growth potential and tried to assess how much faster our economy could grow if these pressures did not exist or were restrained and if we restrained ourselves from succumbing to them, we might find that we could achieve a growth rate of six per cent rather than four per cent.
The reason why our growth is four per cent and why 20,000 people are emigrating is because we choose as legislators to take the easy way out, to succumb to every local and sectional pressure, all of which inhibits economic growth. Economic growth is not an end in itself but the means without which progress cannot be made. This document, the full employment report of the NIEC was drawn up by industrialists, trade unions and civil servants with no axe to grind and is one which should have been read by everybody in this House. It should have struck home to all of us. Indeed, its concluding paragraph pinpoints the responsibility of everybody in the community to avoid all the time pressing for the wrong policies and the responsibility of politicians to resist such pressures. It is a depressing fact that this report fell like a very small stone into a large pool with a small plop. There was only one programme about it on RTE which had far too many people on it and the programme made no point and never got across. There was a motion to discuss it tabled in the other House but the Government over 18 months had no time to discuss it; it was a matter of unimportance as far as the Government were concerned but it is a matter of importance to 20,000 people who are emigrating every year, not because of the failure of any policy but because of the attitude of all legislators who succumb to the attitude of the public for more doles, more sectional pressures. Even in the brief period for which I have been here I have noticed our ability, and even I have done this, to ask questions relating to local matters and I might say legitimately so.
I do not think we take our duty seriously enough in this respect. I suggest that we could fruitfully have a debate on this report, not now but when we come back in the autumn. Indeed, it would be very useful for the Minister to consider having debates like this on such matters, not necessarily for us to blame the Government or for the Government to crow about their achievements, but in order to let our hair down and discuss our problems with less inhibitions, to discuss publications and reports of this sort and learn from them how we could, on all sides, conduct ourselves in achieving better results.
I should like to refer to one matter, that is, the Buchanan Report about which we already have had some talk from some people in this House. This report, perhaps, is the perfect illustration of the generalities to which I have been contributing. Here is a report which has a respectable ancestry and which sets out clearly what would be the result of adopting certain policies, how many more jobs would be created, how many less would have to emigrate over the next 17 years. Let us go back over the origins of this report. The idea of concentrating growth in certain centres, not in Dublin, most of them in the west, which is where they should be, lay in the days of the Committee on Industrial Organisation. When that committee produced a report favouring a policy of industrial concentration and stating arguments for it the Government, having received the report, treated it like a hot potato and set up another committee. That committee considered the matter and produced a report and then after ten months the Government decided to appoint the Buchanan team. They took 22 months and the Government held the report for eight months and everybody thought that the Government were going to announce some decisions. I thought that it was an inappropriate procedure. I would have thought that the Government would have published the report and have a public discussion on it and then make their decision. However, what the Government did was to hold the report for eight months and not announce their decisions and then publish it so that we had the worst of both worlds.
It is now 64 months since this matter was first brought forward and out of those 64 months only 22 months, or one-third, of that period was spent by the Buchanan group in studying the matter; the other two-thirds was spent by the Government in not taking decisions, in delaying action and putting off decisions. Now they have published the report with various sibylline statements which seem designed to assure the people in the areas which will benefit that they are adopting it and to assure those in areas which will not benefit, that they are rejecting it. It is, in fact, a non-decision.
What is involved in this report? There has been an extraordinary amount of nonsense talked about it and this is not confined to any one side of the House and, indeed, people both inside and outside the House have said a lot about this report which might suit them locally. Indeed, I found myself on a radio programme with representatives of the other two parties and it was interesting to see those two people lined up in agreeing with each other to talk nonsense although at least one of them had read the report. The fact is that the report points out that the likelihood is that if present policies are maintained we will have an increase of population in the years ahead but which, first of all, will be quite inadequate to provide full employment and prevent emigration, and a population growth will be concentrated in the east of the country.
The Buchanan Report sets out to see what can be done about this. It sets out to accelerate growth, create more jobs and increase the population more rapidly and, above all, to do this in the west of Ireland. The proposals it puts forwards are assessed in great detail and there are many tables and appendices. Indeed, the report without the appendices is useless and the report appears to be in the Library without the appendices. I do not think anybody can get value from the report without looking at the appendices which are not in the Library. It sets out the consequences that will follow from its implementation. Nobody has challenged its conclusions and no expert has come forward to say that the report in its conclusions is unsound, or that the people were incompetent or biased. There is simply agreement by many people whom the report does not suit to ignore the report and to announce that it is doing something quite different from what it is doing. Anybody reading the articles in the newspapers referring to the report would get the impression that it was sounding the death-knell of the west of Ireland and sweeping people out of it and concentrating them in Dublin. Every article written about it — with certain exceptions and I myself have written on it — had tended to give this impression. The fact is that the report shows us for the first time in concrete terms how to accelerate growth of employment and create an extra 70,000 more jobs, how to step up population by another 140,000, above the normal increase, in 17 years and primarily how to do that in the west and how out of the 140,000 no fewer than 120,000 would be in the western half and fewer than one-third in the eastern half of the country.
That is what this report sets out to do and yet various vested interests have set out to damn this report by talking about it in terms designed to convince the public that it does the opposite, to convince them that it is designed to destroy the west of Ireland and this is political expediency carried to a point that I find unacceptable and I think we have to face our responsibilities. The Government have to face their responsibilities.
The Deputy is not being very balanced himself in his presentation. He is quoting as facts things which are only projections.
I am quoting what the report says. Of course, the report is estimating the results of the policies it proposes.
The Deputy is putting them across here as if they were concrete facts.
What I am putting across is this — perhaps I had better "recap" my position on this and make it clear. We have had in this House the benefit of expert advice on this subject. I know of no subject on which expert advice has been so unanimously given to this House in the last 20 years. We had first of all the Committee on Industrial Organisation — a unanimous report from trade unionists, industrialists and civil servants in various Government Departments — not a dissentient voice on the question of growth centre problems——
Do not repeat all that. We heard all that.
——followed by the NIEC reports on the subject, followed by the report of the Government's own committee on development centres and industrial estates, followed by the Buchanan team. The Government chose this team; they chose the most competent team they could find. Nobody impugned the Government's choice when it was made. They chose a team of people who were renowned throughout the world for competence in these matters and these people made a study in enormous depth lasting almost two years. No study in this depth had ever been carried out in this country before, and they reached conclusions which they put forward in the greatest detail. As the Minister knows and as the Deputies should know, the report has two appendices attached to it, appendices which set out county by county and, indeed, part of county by part of county, what in fact would be in their view the consequences of existing policies and the consequences of their report being adopted.
Now, it is open to anyone to challenge this report. It is open to anyone to get up and tell us here that the people were incompetent and the Government were incompetent themselves. Maybe that is what the Minister is trying to say. Or, it is open to anyone to get up here and say that, well, yes, they were competent people but that they made a mistake on page 42, a miscalculation. Nobody has said that. It is open to say that the people concerned were biased. This has not been said by any responsible person in the country. It is open to them to argue that there was some defect in the method of arriving at the conclusions. There are all kinds of ways in which one could legitimately argue with this report. It is not gospel. It is not the Bible. Of course it is open to argument but nobody has done so. We are not in a situation where there is a conflict of opinion. There is not even one other expert coming along and telling us that he has studied the figures and that there is a miscalculation there and if they had done it differently they would have produced a different result. The report has been challenged by no one except by people who do not think or have not read it or do not care about it. I am quite prepared to accept that this report could be criticised but I have not heard any criticism. What I object to is the idea that the report is going to be damned without any criticism whatever by people who in fact have no evidence of any kind that there is anything wrong with the report and who simply are concerned to protect the particular vested interests that they think they represent or who are afraid of the consequences of accepting the report.
I want to say to this House that there are 140,000 in this country — I put it this way, there are 72,000 people in this country today, children in this country, who, on the assessment of this report, will be somewhere else if this report is rejected and in Ireland working here if it is accepted.
That is not true.
If anyone wants to challenge that statement, let them come into this House and tell us where the report is wrong.
That is just not true.
That assertion has been made by the Minister's and the Government's own team of experts, whom they employed, in a study which goes into more detail than I conceived possible and it is open to anyone to criticise them. There is no fact which they have not laid bare for criticism. If somebody wants to criticise them, let him do so. Until somebody comes into this House and takes this report to pieces and tells us what is wrong with it, it is the nearest thing we have to a blueprint for creating jobs for 72,000 of our children who otherwise will have to emigrate. Nobody in this House of any party has a right in those circumstances to tell those people they have to emigrate just because it is going to lose votes for somebody somewhere in this country. It is time we came to our senses about this and time we accepted our responsibilities on all sides of this House.
The Government are the people primarily responsible. It is your job on that side of the House to take the decisions and it is your decisions, not ours, yours, which will decide whether these people remain in this country or not. This needs to be said and I think it is right that it should be said in this debate. I would be glad to hear the Minister on it in replying. Let him not reply that this report is not gospel, that the figures in it may not be right. Let him tell us where they are wrong. If he does not do that let him stay quiet about it and accept the conclusions until some expert criticism, or even inexpert criticism based on some logical argument, comes from somewhere to tell us where this report is wrong. The fact is that we have here the views, first of all, of the industrialists, trade unionists and civil servants who examined this problem and who were unanimous on the subject. Each committee set up was unanimous on the subject. The Government tried, and hoped, possibly, in setting up the second committee that they would reach a different conclusion. They did not. So the Government had to appoint this team of consultants and they too were unanimous on it.
Who are we in this House to reject the total weight of expert opinion? What right have we to say that everybody is wrong except us? They had no interest in proving something. They were people who had nothing to gain or lose and for them, whether they were industrialists, trade unionists, civil servants or experts, their job was to tell us the truth. If we reject that evidence, if we reject that report without having read it properly, without having examined it, without having argued it, if we reject it simply because it does not suit us, then we will carry on our consciences those 72,000 people who are children in this country today. It is we who will have sent them out and, particularly, you, gentlemen, on the opposite side of the House who have responsibility for taking the decisions.
As one who supports the report, could we have an assurance from the Deputy's party that four out of every five Fine Gael Deputies are happy about the report? I speak as one who completely agrees with the Deputy.
I think we could exchange such assurances on both sides.
That reciprocation will occur but it is, I think, a fact that the bulk of the Deputy's party, particularly outside of Dublin, to the best of my knowledge, are profoundly unhappy, just as many other commentators are. I do not share the unhappiness.
I have been directing my remarks to the whole House. Indeed, while the Government have, as far as I can see, repudiated the report, no such repudiation has taken place on our side and I understand, indeed, although I missed the particular part of Deputy Cosgrave's speech, that he largely endorsed it in his speech today. So, I am not quite clear as to what the nature of Deputy Desmond's problem is.
He should put it in proper context.
All of us do not represent Dublin constituencies.
Who gains out of this? Now, there we have an intervention which shows the state of mind of people in this House of any party. Dublin! Who gains in Dublin? The figures are quite simple.
I am just pointing out that ten Deputies in the Deputy's party do not accept the report at all. I admit that the Government's attitude is quite inexcusable, but equally it applies to the Deputy's party.
It would not surprise me to find Deputies of all parties, who find that a particular area they represent would be marginally disadvantaged by the report, would be more influenced by that than by the consideration that vast numbers of extra jobs would be created elsewhere. We are all human. I would just like to put to the Leader of the Labour Party that it has nothing to do with Dublin and the rest of the country; the whole purpose of this report is to build up cities and the rest of the country. The whole problem in this country today is that the ineffectiveness of our existing industrial policy is allowing Dublin to grow and Dublin alone to grow. The weakness of this country is that we have no other cities but Dublin large enough to take a large industry. I would like to put it to the Minister or to anybody else in the House to consider, supposing a fairy godmother of an American arrived with an industry with 2,000 jobs for men in this country and he wanted to plank it down somewhere, where would it be put? Where outside Dublin would you find a pool of labour of 2,000 men. Where would you find the houses for them? Where would the water be and the sewerage for such an industry?
You certainly would not get it in Dublin.
In Dublin, indeed, you are going to have trouble to get the fresh housing but the people are living in the appalling housing that is there. At least, there are 2,000 people. And that industry would come to Dublin because there is a pool of unemployed in Dublin. Whereas, in fact, that industry should go to some other part of the country. It is the ineffectiveness of our present policies that is leading to continued growth of Dublin. What we have to do is not to try to stop Dublin from growing negatively, because that might mean indeed that that was the only policy we had got. That is the only policy one hears from some people. If that is our policy, then in that case all we are going to do is to stop industries coming here at all and stop our existing industries from growing. It is easy enough to stop economic growth. You can do that at the drop of a hat. The problem is to create it and to accelerate it.
You are experts at that over there. You did that magnificently on one occasion.
Yes, all right, you can introduce your cracks. You are very welcome to them, but I am being serious on this occasion.
You brought the economy to a standstill.
If the Minister's only reply to the discussion which I am trying to initiate about 1986, which is the date this report refers to, is to go back to 1956, I despair of the country. I do not think the Minister should bring the debate back to that level.
Oh, dear me. You want to forget it.
The Deputy could address his remarks in equal measure to Deputy George Colley, who has as much responsibility as Deputy Haughey.
I am glad of the Minister's intervention which enables me to make a point which I had here but which I might have forgotten. I want to emphasise this point about the larger industry. Our problem is that there is not any place in this country capable of taking a large male employing industry, yet every year, 10,000, 12,000, 14,000 men have to emigrate for lack of jobs. Let us look at Northern Ireland. Let us compare ourselves with them. In Northern Ireland, with all their deficiencies — and we do not need to go into them tonight — they have adopted an industrialisation policy that is very different from ours. They, perhaps, are less subject to democratic pressures but, nevertheless, in Northern Ireland they have adopted not one but a dozen industries on a scale larger than anything which we have created or acquired from abroad during the past 15 years. They have done so because they set out to get these industries. We set out to prevent them coming.
That is utter nonsense.
A Deputy
What about Sligo?
I shall speak about Sligo in a moment. The fact is that we are not geared to take such industries. Our job should be to build up in every corner throughout the country centres with the facilities to take in industries on a very large scale. As long as we concentrate on getting cottage industries which is an unfair but not a totally incorrect description of policy to date we will be in the position where Northern Ireland will continue to have this rapid industrial expansion while we continue to make little or no progress.
Anyone who examines the progress of industrialisation in this country within the past ten years cannot be but impressed and depressed by what they will find. When one sees the scale of industries in Northern Ireland and contrasts that with what we have got — we have many new industries; I do not criticise the Government beyond a certain point; their policy has succeeded up to a point but it has not been good enough——
We were placed third in the OECD list of industrial exports last year just the same.
I could produce all the statistics the Minister wants and I could prove to him tomorrow that this is a wonderful Government but I am concerned with facts. We are speaking about the fact that Northern Ireland has attracted industries on such a large scale while we have attracted nothing on a comparable scale. We have attracted many industries, our policy has succeeded up to a point but there is no comparison with Northern Ireland. Let us face the facts and let us not make political points.
The Deputy is making a totally political speech.
The Minister must be deeply embedded in politics if he sees my speech as being a political exercise. Sligo was mentioned by a Member from the other side of the House. Let me say in this regard that the Buchanan Report tells us that if present policies are adopted, certain results will accrue in Sligo as regards population growth. It says that if the policy of industrial concentration is adopted, the rural areas of Sligo will have in 1986 2,000 fewer people in them than they would have on the basis of present policy but that the town of Sligo would have 10,000 more people in it than on the basis of present policy. What I want to know is what is our concern? Is it for the maintenance of population in rural areas? Do we tell 8,000 people to get out of the country because we are so determined that they should live outside the town of Sligo instead of inside it? I hope the people of Sligo will be unanimous in their answer to this question. The people of Sligo would be much better off if their children could find jobs a few miles from their homes than having 2,000 more people in County Sligo and the rest in Coventry or elsewhere. However, all this is only a means to an end.
I was glad to hear Deputy O'Kennedy having something good to say about the inequality of life in Ireland and the need to concern ourselves with this problem. We have two major problems in this respect. One is the problem of social reform and we also have the problem of social priorities. We are moving in the right direction and I think I can fairly say that this is due in a good measure to the efforts of the Opposition since 1964/5. More and more attention is being concentrated on this issue but there are still areas where there is inadequate concentration. We have achieved a certain amount — the development of children's allowances in this Bill is an example of this but our major deficiency is in the field of housing — I shall not speak on that now — but I will say that although a certain amount has been achieved, we are still far behind by comparison with the thinking of other countries and we still do not realise how much our priorities are out of time with the thinking of this century by people, whether they be Christian or communist or whatever their beliefs may be, about their duty to their neighbours.
Our social services lag far behind those of other countries with comparable living standards. I shall not dwell on that now but I wish to say something on the general issue. This is an intangible and difficult thing to handle. It is easy for me or the Minister or anybody else to talk about facts and figures and to throw out figures on economics but it is not easy to talk about the quality of life and say anything useful. I do not think that I am able to say very much that is useful but I would like to say to the House that we need to change our attitude here. We are destroying much of what we have got and we are letting much else die and what we are putting in its place, as Deputy O'Kennedy has said, speaking in the architectural field, is not always particularly attractive. The area he spoke about is a good example of our attitudes and I appeal to the Minister and to the Government to think hard about this.
I do not believe that this Government would like to go down in history as being the Government which allowed much of our heritage to be destroyed. However, far from a fresh start being made, we have as the first decision of the new Government, a decision to give planning permission with regard to houses that are quite near to us here. When I heard that, my heart sank. I thought that, perhaps, enough had been said on the subject to arouse the people on the other benches as to their responsibility. If this policy is continued, all that is worthwhile in Dublin will be destroyed. It is appalling to think that this will now happen unless we can make some appeal that will touch the hearts and the consciences of the people on the other side of the House. What is now proposed is to dive right into the middle of the city and start pulling it down.
This is only one aspect of the trend. We have it again in regard to the Irish language. The policies with regard to the Irish language have been damaging to the language and yet there is a reluctance to face this fact. We seem to have concentrated so wholeheartedly during the past ten years on economic growth that we can think of nothing else. It was right to have this concentration on economic growth during the 1950's and 1960's but at the same time we have not raised our sights to some of the things we should have done. We have had some new thinking with regard to social reform but not nearly enough and when it comes to retaining our national heritage, we still have nothing new to offer. We have a responsibility here and the nineteenth Dáil should not be the Dáil to let this happen.
I appeal to the Government to think again on this matter with regard to these buildings and to think again about their over-all position. It is time they raised their sights for economic growth. They should not let up in trying to achieve economic growth. They should adopt policies and accelerate policies to increase growth. They should be prepared to look at the broader picture and to ensure that the country they hand on in five years time, instead of being an impoverished and diminished country, will be a better country for posterity.
The Finance Bill contains one element of innovation. The rest of it, as we see it, runs on established lines with variations within predictable limits. I should like to say something about the element of innovation. I refer to section 2 which gives certain taxation exemptions to writers and artists in certain circumstances. The Deputies from these benches have welcomed that innovation. I want to welcome it very warmly in so far as its spirit is concerned. Its spirit, as I see it, signifies an attempt to bring to an end the cold war which this State has waged on its writers and artists almost since its inception and certainly since the Censorship of Publications Act, 1928, and the successive sad implementations of that Act.
This change is important. I should like to agree with Deputy Dr. FitzGerald in what he has just said. It is important for being more than just a tax concession. It is important as representing at least the possibility or the beginning of a changed attitude towards writers and artists in the society and towards the kinds of talents, which are often rather unruly talents, which writers and artists possess. This has a bearing on creativity in the community more generally, not only artistically but also politically and economically envisaged. This change, because of the spirit which it shows, is itself an important and creative one. In welcoming it, however, I should like, in Deputy Dr. FitzGerald's footsteps also, to wonder about certain things and to wonder how far a change of this character is consistent with other things that are happening. I wonder how it is consistent with the continued, although somewhat attenuated, implementation of the Censorship of Publications Act and whether, for example, writers banned under that Act will be generally recognised under this Bill as having cultural or artistic merit. I wonder whether, if this is not so, this Bill will only apply to a category of tame artists who may safely be dealt with.
Is this welcome change here consistent with what is happening in our city? How can we encourage the production of works of art, creative and original, in our time if we do not respect the heritage of creative and original works of art which our past have left us in the buildings of this city. We should like to hear from the Minister on that subject. We should like to have an opportunity of hearing from his colleagues also. It looks as if a large part of this city, and particularly the most historic part, is to be torn down, as much of it has been torn down already. That is not consistent with the spirit we are warmly welcoming in this section.
I should like to make another point in more detail, which we might develop in Committee, about the language of the Bill which says that this section applies to an individual. That is legal terminology and I am not complaining about it as terminology, but I should like to bring to the Minister's attention the point that works of art are not always produced just by individuals. Many of our greatest works of art of the past were produced by collectivities or communes as the great cathedrals of medieval France were produced. In our own time much of the artistic productivity is in the form of collective work. The theatre is, for example, pre-eminently a collective work and is also the art form through which this country has contributed most to the art of the world, in recent generations at least. Many of our Irish playwrights in recent times and other times have contributed much that was creative and original but all these playwrights would agree that no two people have contributed more to the theatre in this city than two people whom we do not associate uniquely with the writing of plays. One of them has written plays. I refer to Dr. Michael MacLiammóir and Hilton Edwards. They have done a great deal for the theatre in this country. Many playwrights would not feel that this principle was being properly applied if it did not apply to people like those whose creativity was not in the form of writing necessarily.
There is a difficulty which I hope will be met by the Revenue Commissioners' liberal interpretation, of which the Minister has told us, of the words "generally recognised as having cultural or artistic merit". Few works of art are generally recognised in that gratifying way until their creators have been in their graves for some years. The Revenue Commissioners would have to be liberal in their interpretation of "generally recognised". There is another point. The phrase "having cultural or artistic merit" is fairly broad and is the sort of idea one can imagine as being reasonably construed by an enlightened Government Department. The explanatory memorandum uses the words "which is original and creative". Those words appear in the explanatory memorandum and also in the Minister's speech. Perhaps, I have not read the Bill carefully enough but I do not see those words in it. If they do not appear in the Bill I should like to hear from the Minister about this difference which I seem to detect between the explanatory memorandum and the Bill.
They are in the first line of the section.
In that case I stand corrected. Thank you very much. These words would be extremely hard for a Government Department to interpret. There is always considerable doubt about what is "original and creative". The novel Ulysses would be regarded generally now by most literary critics, though, perhaps, not by most people opposite, as being the epitome of an original and creative work in the novel form. At the time of its publication it was not so regarded. I am not even sure whether the Revenue Commissioners would so regard it now. Those words are not useful; “having cultural or artistic merit” would be a better discrimination.
In any case, there is the point that if this is meant to do some good to writers and artists the limitation to "original and creative", as distinct from "having cultural or artistic merit", will restrict the scope of what has been conferred. Strictly interpreted, "original and creative" are very narrow terms, indeed. The story is told that the French poet Paul Valéry met Albert Einstein and wished to find out what Einstein did with his original ideas. He asked: "Do you make a note of them on your cuff?" Einstein replied: "No, I do not." Valéry then asked if Einstein kept a notebook beside his bed in which he recorded his notes. To this Einstein also referred in the negative. The poet then asked: "What do you do with your original ideas?" to which Einstein replied: "There is no problem. I have had only one original idea in my whole life." As I say, this idea of originality, if construed with Einsteinian vigour, would very much limit the cost of the proposition before the House.
I do not want to say very much about the Budget in general. It is essentially a status quo measure. I suppose the Budget could be called a good one within the framework of the assumptions of the Government. It is not a Budget intended to be used as a major instrument for economic and social change. It is not a socialist Budget. We cannot complain about that. The people knew the kind it would be and they approved at this particular time of that kind of thing.
We feel that most of our criticism in relation to what the Budget represents should not be at this stage on the details of the Budget itself but in the form of a critique of the society of which the Budget is expressive — a society in which the alienation of our heritage is going on in more ways than one, including the form I referred to, that of the destruction of most historic parts of our city, a society in which unemployment and high emigration are accepted as continuing facts of life, governed by a general philosophy of marginal regulations with the essential of laissez faire.
Deputy O'Kennedy in his interesting speech earlier today — I concur with Deputy Dr. FitzGerald in praising its general tone and tenor — referred in rather too strong language to the emigrants who did not have to emigrate — solicitors, dentists and so on. He rather suggested that it was their duty to remain here, certainly under this Budget. I spent a large part of this morning down at the North Wall. I spoke not with solicitors or dentists but with dockers who are being steadily and systematically laid off. They are being laid off under terms which for the moment bring them no immediate hardship but laid off they are being. The prospect is of further laying off for men there. It does not look as if they have much alternative but to emigrate, to collect their golden handshakes and leave the country. That is one symptom very near where we are sitting of the kind of evils not being attacked with the kind of urgency required to deal with it. I agree with a good deal of what Deputy Dr. FitzGerald said. I do not want to end entirely on that note however. I should like to renew my praise of the spirit of the second section of this Bill and to hope that it is for this achievement rather than for any other that Deputy Haughey will be remembered in the history of the Government of our State.
The debate I think has wandered far outside the usual limits of a debate on Second Stage of a Finance Bill. Of course, we all agreed that it should do so. While we had a full discussion on the Budget as such, when it was before the House, nevertheless, there were many Deputies who might be given an opportunity on this occasion to discuss the principles and the strategy of the Budget once more. One would, however, agree with regard to the latitude which has been extended in this way to Deputies to express far-reaching, wide-ranging views. This does not operate to compel me to follow them through those interesting but, perhaps at this stage distracting, byways.
I would like, therefore, to confine the few remarks I wish to make at this stage to matters which are particularly relevant to the Bill itself and which are appropriate for a Second Stage discussion on the Finance Bill. I do not think I should be expected to deal with town planning issues raised by some Opposition Deputies. My own view is that there is a great deal of emotive exaggeration about those matters and I think the people who take strong views about preservation are not always fair in their presentation.
Deputy Dr. FitzGerald spoke a great deal about the necessity for economic expansion; the necessity to achieve full employment; and to take the hard decisions which the achievement of full employment would require. If he speaks in that way surely he must also recognise you cannot freeze a capital city forever and there must be many times when difficult decisions have to be taken between the necessity to expand and develop on the one hand and at the same time the desire to try to preserve what is old and beautiful on the other. I think there is no perfect solution to problems of that sort but I do not think anybody helps the situation by exaggerating what is happening.
The Minister is exaggerating the dilemma between growth and preservation, not I. There is no absence of that.
I see a very real dilemma. I know very many people in this city who spend their working lives in office accommodation which is totally substandard. In that sort of situation people must admit the necessity for new buildings.
Not necessarily in Georgian squares.
If there are going to be new buildings let us try to have them of the highest possible quality, aesthetically as satisfying as possible. Let us try to make sure they merge into the existing city as pleasingly as possible. Again, let us try to preserve a sense of balance about the whole thing. I am certain the Minister for Local Government is just as interested as any Deputy in this House in trying to preserve what is old, valuable and beautiful. He also has to face up to realities. If people can prove to him that pulling down and rebuilding is the only possible course of action, then I do not think he can in all honesty and fairness refuse permission on planning grounds in certain circumstances. This really is not a matter for me: it is a matter for the Minister for Local Government. My only plea at this stage is to suggest that we would all approach the problem — it is a real problem— in a balanced and reasonable way.
Is the Minister not the owner of some of these houses, or the lessor, as Minister for Finance?
In my corporate capacity, yes.
So it is a matter for the Minister.
In these matters, it is entirely a matter for the Minister for Local Government.
Planning permission, permission as to whether it will be sold to a developer for that purpose, is for the Minister.
My lease in these buildings is running out. They are completely useless, from my point of view, for office accommodation. So far as I am concerned, in my corporate capacity as Minister for Finance, I am out of the situation. I have no interest as Minister for Finance in the property.
I would suggest the Minister has responsibility: they are his buildings.
The Minister should be allowed to conclude his statement without interruption. Then, if there is a question to be asked at the end, the Deputy could ask it.
Right.
Again, Deputies spoke of the necessity to do something about personal allowances. I recognise that there is a need to do something about them. In fact, we are making a small improvement in the situation in this Bill. I want to emphasise again what I have said here before, namely, that any significant improvement in the personal allowance for income tax purposes could be made only in the context of some pretty fundamental overhaul in the structure of our entire taxation system. To increase personal allowances at the moment, even moderately, is enormously expensive.
Dr. FitzGerald asked about the system whereby our income taxation would flow in both directions — in other words, a system where payments would actually be made to people below a certain income. This matter is being studied in other countries. We are keeping abreast of these studies and, indeed, doing our own investigation and research. I believe one description of this is "negative" income tax. However, we are keeping abreast of the situation and making our own studies. I can assure the House that, whatever about anything else that is or is not in the Finance Bill being complicated, that is perhaps the most complicated subject of all. I should not like anybody to gather from what Deputy FitzGerald was saying that it is something that will easily be introduced or adopted.
There was a great deal of talk by Deputy FitzGerald also on the Buchanan Report. I do not intend to discuss that either at this stage: there will be another opportunity to discuss the Buchanan Report and all its implications. The Minister for Local Government has indicated that such a discussion can be held here any time it is required. Usually, Deputy FitzGerald is very honest about these things although sometimes I think he gets carried away by his own academic arguments. Generally speaking, however, I think he is reasonably honest in his presentation of matters in this House, as also in the Seanad. It is a bit unfair, to say the least of it, to suggest that "Buchanan" is a panacea; that all we have to do is to adopt "Buchanan" and, hey presto, we have 72,000 persons with jobs. He knows himself that that is not so. In fact, in another part of his speech here this evening, he indicated the difficulties in economic planning, in promulgating and giving effect to policies of full employment. That part of his speech, I think, was more correct than when he was talking about "Buchanan." It is misleading to suggest that you have just to adopt the principle of growth centres and everything else automatically falls into line. No matter how accurately they may have been drawn, or expertly devised, we must recognise and tell the people that figures mentioned throughout "Buchanan" are only projections and estimates of what could happen in certain circumstances. I do not want to go into the merits of "Buchanan" on this occasion, either.
Deputy FitzGerald attacked the Government for their alleged inaction over the years in this whole field. He must recognise that there are two growth centres actually under way, one in Waterford and one in Galway. I hear a mention of Shannon. Shannon was initiated long before even the fashionable phrase "growth centre" had evolved. But, even since these discussions about growth centres, and so on, started, the Government have moved positively to establish growth centres and now we have two under way— one in Waterford and one in Galway.
I do not think it is fair or honest to attack the Government for not rushing in for the adoption of "Buchanan". It is a complicated business and should not be decided merely by political pressures. Any Deputy of this House is perfectly entitled to represent and promote the interests of the particular part of the country from which he comes. I do not see anything wrong in that. It is up to the Government, of course, who have the ultimate responsibility— having received and considered all the best advice they can get — to take decisions. Any Deputy of this House is entitled to try to influence the Government one way or another in taking these decisions. It is, however, a very complicated business. The decisions which will be taken will be very fundamental and far-reaching. They will affect the future of this country and of different parts of this country for many decades to come. In that situation, I think the wise thing to do is to be completely sure you are right before you act.
A number of things have happened in our experience as a Government since "Buchanan" was published which put a different complexion on some of the ideas and proposals put forward in the report.
Deputy Dr. FitzGerald had a rather peculiar interpretation of what is or is not a credit squeeze. The situation in regard to bank credit is quite straightforward. Last year the Central Bank issued advice to the banks as to the increased credit they should make available and the banks, for one reason or another, did not adhere exactly to the level recommended by the Central Bank. This year the Central Bank came along and recommended a very substantial increase in credit, but which was in fact — and rightly so — less than the amount which had been made available in the year before. I do not think you can call an increase in bank credit of £60 million, £70 million or £80 million a credit squeeze. I do not think you can legitimately describe that as a credit squeeze. If the level of bank credit were being absolutely reduced, that would be a credit squeeze. But when you are actually making a great deal more credit available, even though that amount is less than the increase made available in the year before, I do not think it is legitimate to call that a credit squeeze at all.
Deputy Dr. FitzGerald is very often difficult to keep in one's sights because he roves over wide fields. Indeed, I found him, from time to time, a little bit better perhaps in his hindsight than in his foresight.
It is true of us all.
Perhaps, but then we do not all speak with the same overweening self-confidence as Deputy Dr. FitzGerald. In matters of economic management I think it is as well to be prudent and not to attempt to pretend to know everything and to know all the answers.
Precisely what I said.
The Minister is being patronising now.
I have sat here most of the day being patronised from many directions.
The Minister is entitled to give his reply.
I want to say that at no stage could any Minister for Finance or anybody concerned with the running of the economy of the country ever sit back and say: "Everything is well; everything is perfect; there are no problems; there are no dangers; there are no indicators which would seem to warn us of forthcoming troubles". It would be idle for me to pretend that there are not dangers inherent in our present situation, but it would be equally foolish for anybody to talk about crises. We have a difficult situation to face for the rest of this year. We have a number of things we have to watch. Undoubtedly, we have to keep the balance of payments situation very carefully under review but we did anticipate a fairly substantial deficit this year and we were prepared to tolerate that. So far, there is no indication that there is anything going radically wrong with our estimates or with what we anticipated would happen. We do have to watch the incomes situation very carefully. I make no apology for saying again that after the settlement in the maintenance men's strike a dangerous situation presented itself to us. We grappled with that situation. We took initiatives and again, thanks to the very enlightened attitude of the Irish Congress of Trade Unions, we were able to bring a certain sense of realism back into the situation. I hope that that situation will continue but it may not and there are indications that we might have further difficulties perhaps this year on the incomes front. But all I can do there is to assure the House that we will watch that situation also. If it appears to be getting out of hand, then we will not hesitate at all to discuss the situation again with the congress, and indeed with anybody else who appears to be in a position to help, and take whatever action we can.
There is no reason why, in spite of all these difficulties and these potential dangers, we should not have a fairly good year in 1969. We should, I think, achieve a growth rate of four to four and a half per cent and that is quite good by western European standards. Perhaps we could do better. Perhaps we will be able to do better in the future, but the world situation is threatening and ominous at the present time. When Deputy Liam Cosgrave spoke of inflation he was of course right to point out the dangers of threatening inflation, but he should have gone on to point out that this is a world-wide phenomenon at the moment and that practically every developed country seems to be experiencing or to be threatened by dangerous inflationary pressures. Of course, we have an open economy and it is very difficult for us to avoid importing inflation when inflation is rampant around the world. Again, the only thing we can do is to watch the situation carefully and, without risking or without unnecessarily interfering with our growth prospects, to take whatever remedial action may be necessary from time to time. No matter what Deputy Dr. FitzGerald may say, we have not been doing too badly in this business of economic management and using the conventional fiscal remedies to deal with dangerous situations. In fact, we have got the commendation of the OECD for the way in which we have on occasions dealt with difficulties which arose in our economy.
I do not want to say too much about section 2 of the Bill because I am sure we will be talking about it again on the Committee Stage, but I am reasonably happy at the way in which it has been received by most Deputies. I suppose with something like this it is only natural that Deputies would express apprehension as to how it might work in practice, but my own feeling is that it is a reasonably practical section and I am hopeful that it will work without any great difficulty. It will be our intention to make the section work. We have brought this concept forward because we believe in it and, believing in it, we will do everything we can to ensure that it achieves the purpose for which it is intended. I will not hesitate to amend this section next year if necessary, if experience of the working of the section indicates that we should do so. I shall ignore — I think that is the best thing I can do — what Deputy Richie Ryan said and the warped interpretation which he endeavoured to put on the section. I shall just content myself by saying that he is completely wrong in what he said and that it is a gross misinterpretation of what is in the section and indeed what is intended by the section.
A number of Deputies said that this was the only innovation in the Budget. Perhaps I suffer from some pride of parenthood, but that is understandable. Apart from anything else, there was in the Budget the totally new provision to make money available — an original grant of £100,000 — for recreational and sporting facilities to help to provide amenities and facilities in the recreational field for our young people. Deputies have spoken about our way of life, and about attempting to make sure that we use the fruits of economic growth to improve the quality of living. Again, I want to say, with all due modesty, that I have been preaching this particular doctrine for more than three years now and that I have not brought in one Budget that did not attempt to do something to promote some form of cultural activity and encourage something that would help to improve the quality of Irish life. I agree this is something to which we must give increasing attention in the future and, apart from just talking about it and bandying the phrase "the quality of living" around in the House, I would welcome any practical, constructive suggestions which Deputies might put forward and which could be adopted to this end. I should even be prepared to consider favourably on its merits anything that Deputy FitzGerald puts forward in this connection.
These are the only remarks I wish to make at this stage. I expect that we shall be getting our teeth into the realities of the Finance Bill when we come to the Committee Stage and I shall then be happy to answer any questions Deputies may have on particular provisions and I shall try to elucidate any points which may be worrying them.
Question put and agreed to.
Committee Stage ordered for Tuesday, 22nd July, 1969.
The Dáil adjourned at 10.15 p.m. until 3 p.m. on Wednesday, 16th July, 1969.