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Dáil Éireann debate -
Tuesday, 11 Nov 1969

Vol. 242 No. 4

Committee on Finance. - Immature Spirits (Restriction) Bill, 1969: Second Stage.

I move: "That the Bill be now read a Second Time".

The Bill is concerned with the minimum period for which potable spirits, whether home-made or imported, must be kept in warehouse before being released for home consumption. At present, the law requires spirits, with some exceptions, to be matured in warehouse for at least five years. The Bill proposes to reduce this general age requirement from five years to three years and it also provides a special lower age requirement of one year for rum.

The Bill does not in any way affect the position of those descriptions of spirits which have always been exempt from the age restrictions. Examples of these classes of spirits are gin and liqueurs.

The proposed change in the law is being introduced at the request of the Irish distillers in order to provide them with greater flexibility in meeting the requirements of export markets. Whilst the law we are discussing applies only to spirits sold on the home market it has an indirect effect on exports. This happens because in an important export market like the USA imported spirits cannot be released for consumption unless they are eligible for sale in their country of origin. In the United Kingdom the general minimum age limit is three years. The result is that Scotch whisky and indeed Irish whiskey produced in Northern Ireland may be sold in the USA at three years whilst our whiskey must be five years old.

In considering this subject we must also bear in mind the trend of developments in Europe. The Council of Europe, of which Ireland is a member, has produced a draft Convention which defines various types of spirituous beverages and the definitions include a reference to the minimum age at which the spirits may be marketed. The minimum age proposed for whiskey is three years and that for rum is one year. It is to be expected that the European Economic Community may also decide to adopt similar definitions of various types of alcoholic beverages.

It can be said, therefore, that the amendments proposed in this Bill will do no more than bring our law into line with international thinking on the subject.

I would like to emphasise that the Bill is not designed to alter the character or reputation of Irish whiskey. All the law does is to specify minimum age requirements. The Irish distillers have always taken great care to safeguard the quality and reputation of Irish whiskey and they can be relied upon to continue to do so. In this respect, the interests of the consumers and the distillers coincide.

The Bill does not alter the duties on spirits in any way. As a corollary to the enactment of the Bill, however, it will be necessary to provide that spirits which have been warehoused for three years or more but less than five years will be exempted from the small additional duty of 2s 6d a proof gallon which is chargeable on immature spirits. In order to achieve this, the Government propose to make an appropriate Order under the Imposition of Duties Act, 1957. Neither the Bill nor the proposed Order will have any effect on the revenue.

This Bill certainly has one great merit in it: it is one of the simplest draft Bills we have ever seen. We in this party are satisfied with the proposal put forward by the Minister. As far as I can find out the original term for which spirits had to be kept was laid down in 1915 by a British Act, and that Act provided that the minimum period was to be three years. That was changed to the present level of five years by the Immature Spirits (Restriction) Act, 1926.

I find it rather odd to note in looking back over the Dáil Debates of that time that the period was increased from three to five years without any explanatory statement by the then Minister for Finance, without any speech from the other side of the House, without any speech from the Minister's side of the House, and that it went through the First, the Second, the Third, the Fourth and the Fifth Stages in this House without any comment. In the Seanad they apparently appreciated their palates slightly more and they did introduce two drafting amendments which came back to the Dáil, and again the Dáil offered no comment. We are therefore completely in the dark as to why the period was changed from three to five years in 1926, and of course the 1947 Act merely repeated the 1926 Act.

It cannot be stressed too much, however, apart from the facetious angle to which I have referred, that this will not in any way affect the taste or the quality or the maturity of the whiskey here at home, be it Jameson or Gold Label, which the Minister and I drink. I do not know whether, when he is down south, he goes to Paddy Flaherty, but I must confess I do not. However, the whiskey we drink here at home will be exactly the same, thank goodness, as that which we have been drinking before.

It also stands to reason that, in relation to export markets, particularly in these days of high interest rates, we cannot possibly hope to sell five-year-old whiskey in America in competition with a three-year-old; the price differential, with rates at about 10 per cent per annum, would be something of the order of one-fifth. If our distillers are to be able to compete effectively in America they must be able to compete on the basis of equality in the price of their wares.

It was, I think, largely to enable a broader base to tackle the export market that the United Distillers of Ireland was formed, and it was formed following suggestions right down through the years that the distillers themselves should do something to tackle exports. We are helping them to do that in this case because—and I am aware of this from my own personal knowledge—the law in the United States is that one cannot sell spirits from any country at any lesser maturity than is permissible under the law of that country, and hence without this Irish whiskey would have to compete at approximately a 20 per cent price disadvantage. The distillers have gone a long way to try to break into the American market by the adaptation for that market of blends and tastes, and it would be very wrong if we were not to help them to do this by this legislation.

I do not know, perhaps the Minister does, anything about rum. I thought, until I sat down to think about this particular Bill, that I knew most things about most beverages but I am afraid I know very little about rum. In relation to the change in the maturity period for rum envisaged here I shall have to take the Minister's word that it is a beneficial change. I should be prepared to accept either the corporate word or, on this particular subject, the individual word.

I was a civil servant in the Department of Finance when the 1947 Act was passed, and I do not think Deputy Sweetman's account is accurate. The 1947 Act was brought in because the distillers were running into difficulties at the time and they wanted the period of maturity changed. Deputy Sweetman said that the 1947 Act repealed the 1926 Act.

I heard Deputy Sweetman talk about the 1926 Act.

But did the Minister not hear Deputy Sweetman say that the 1947 Act repealed the 1926 Act? I am saying that was not so. I am quite certain I am correct about this because I know the circumstances in which the 1947 Act was brought in.

In the Schedule of the enactments repealed by the 1947 Act it clearly sets out: 5 and 6 George V, C.46, The Immature Spirits (Restriction) Act, 1915, and No. 26 of 1926. The Immature Spirits (Restriction) Act, 1926. Both were cited as being repealed in the Schedule to the 1947 Act.

That is correct, they were both repealed, but the 1947 Act did not re-enact what was in the earlier Acts. The point was made at the time that Scotch whisky could be sold at only three years whereas Irish whiskey had to be much older. I am quite certain about this, although I do not have the records here as I have not sufficient interest in the subject to bother about it. The fact is that the law was changed at the time because of conditions brought about by the war.

The 1947 Act dealt with rum.

I have no doubt whatever about the circumstances in which the Bill was brought in, and it was not as the Minister is now suggesting. It arose because of representations made by the distillers.

I have not a great deal to say except to assure Deputy Sweetman that rum is a very interesting drink and one about which we do not know enough in this country. In the West Indies, where rum comes from, there are as many different varieties and qualities of rum as there are of French wine. It is possible to become a connoisseur of rum.

I would correct Deputy Dr. O'Donovan by saying that the 1947 Act was brought in because rum was very scarce after the war and the maturation period was temporarily reduced from five years to three. That was the simple reason for the 1947 Act.

Question put and agreed to.
Agreed to take remaining stages today.