I listened with great interest last night to Deputy Garret FitzGerald and Deputy Patrick Hogan speaking on this Budget. Their criticism of it was quite remarkable. Deputy FitzGerald made it perfectly clear that his objection to the Budget was, strangely enough, the insufficiency of taxation. I admire Deputy FitzGerald's honest approach to the matter and his willingness to allow political capital to be made against his party. At the same time I find it very difficult to see how Deputy FitzGerald can reconcile that with having voted against the only new taxation which was imposed in the Budget. Deputy FitzGerald makes the case that there should have been much more, but the one bit of taxation there was, the additional 2½ per cent, was opposed by Deputy FitzGerald.
Committee on Finance. - Resolution No. 3: General (Resumed).
As the wrong tax.
Deputy Hogan believes that the Minister for Finance made the error of applying turnover tax to items generally and should have confined himself to two items in particular, spirits and cigarettes. I asked him where he thought the necessary £20 million would be raised and he said by putting a few pence on cigarettes and a few pence on spirits. An extra 4d tax on spirits would raise £1.4 million. Deputy Hogan seems to be unaware that in order to raise £20 million you would have to put so much tax on spirits and cigarettes that there would no longer be any return from them. I thought, without intending any disrespect to either Deputy FitzGerald or Deputy Hogan, that their two speeches were exceedingly weak, but I will grant them this, they were as good as could possibly be made in the circumstances. Neither the Opposition nor anybody else in the country can justifiably criticise this Budget. It is one of the finest pieces of financial legislation that has ever been introduced. The Opposition were flabbergasted that, with all their moaning and groaning, the Minister for Finance was able to balance his books and introduce a Budget such as this.
The important thing about the Budget is the priorities which are made. The Minister had a certain amount of money to give away. It was given to three principal groups, and I doubt if anybody in this House or outside it could disagree about the three groups to whom these benefits and reliefs were given. They were given principally to social welfare recipients, and we now have the situation that our contributory old age pension is equal to the basic contributory old age pension in Britain and in Northern Ireland. Furthermore, the additional allowance for a wife in our contributory old age pension is higher than the corresponding allowance in Britain and in Northern Ireland. The Minister for Finance has taken the wind out of the sails not just of the Opposition in this part of the country but of the Unionist Party. How long have we had to listen to them say that if the people of the six north eastern counties were to be reunited with the rest of the country their social welfare benefits would be reduced considerably?
What about the health services?
There is the extraordinary situation that a socialist Chancellor of the Exchequer in Britain did nothing for social welfare; in fact he relieved surtax payers somewhat. Our Minister for Finance, against the opposition of the Labour Party, who voted against the Budget, gave the largest increases ever given in social welfare benefits and gave substantial reliefs in income tax to lower paid workers, to the people who needed those reliefs most. He also gave considerable assistance to farmers, particularly smaller farmers.
When Deputy Burke spoke here last week he was particularly struck by the fact that the socialists in this House, at least 11 of them, should have seen fit to vote against the Budget. In fairness, Deputy Burke might have pointed out that not all of them voted against it. Some of them abstained, and I congratulate and admire them for it.
That is not accurate. It is quite false.
Six members of the Labour Party, according to the record of the House, did not vote against the Government. I was giving them credit where I think credit is due.
Every Labour Deputy who was in the House voted against the motion.
Almost ten Fianna Fáil Members did not vote for it either. Did they abstain?
A total of 68 Fianna Fáil Members voted for it, and the others were either ill or out of the country. Deputy Noel Browne, for example, was here but did not vote against the Government.
This is not accurate. Every Member of this party who was in the House voted against it. Deputy Michael O'Leary unfortunately was not here.
It seems to me very remarkable that the Labour Party should go to such trouble, through Deputy O'Donovan, to impress upon us their opposition——
To the turnover tax.
——to an increase of 17s 6d in the old age pension.
The motion was for the turnover tax, the doubling of taxation on every commodity that is sold in the shops.
What would pay for these increases in social welfare benefits and the reliefs given in income tax to lower paid workers?
If the Minister is the financial genius you say he is he should have devised other means.
Last night I pressed Deputy Hogan at some length to say where the money would come from if he objected to the turnover tax, and he suggested putting a few pence on spirits and cigarettes. That is the extent of his thinking in the matter. He feels that £20 million is going to be raised in that way. I am very glad for the sake of the country that the Minister for Finance is more reasonable in his approach to things than the Fine Gael Party. It seems to me remarkable that having heard Deputy Cosgrave and Deputy O'Higgins criticise the alleged savageness of the Budget we should have another prominent member of the party criticising the failure of the Minister to impose sufficient taxation.
It is also worth drawing the attention of the House to the fact that the Budget was introduced eight days after two by-elections which Fianna Fáil lost. Needless to say the Government were aware for several weeks before those by-elections of the general nature of the Budget. It would have been a very easy matter for the Government to have brought forward the Budget or to have put back the by-elections. Indeed, many people say that the by-elections might have been won by Fianna Fáil if the Budget had been introduced before them but Fianna Fáil are not prepared to descend to that kind of thing. We have refused to do it before. We were accused in the Budget of 1969 of trying to buy favour, that we brought in a false and untrue Budget in order to help us win the general election last year and that as a result of the allegedly false and untrue Budget, a mini-Budget or a supplementary Budget would have to be introduced.
We were told first that it would be in September and then we were told it was coming in October but it did not come. Nearly every day the Taoiseach was pressed at Question Time or on the Order of Business about the supplementary Budget. It was to come in November and when it did not materialise then we were told it was to come in December. There was no sign of it then and we came right around, 12 months later, to April, and then we had another Budget. We were told that we must expect the most savage Budget ever to pay for and to make up for the financial mistakes of the Fianna Fáil administration over the past 12 months or over the past 12 years. What do we get? We get the largest increases ever in social welfare; we get much welcomed and badly needed reliefs in income tax for lower paid workers; we get substantially higher subsidies, bonuses and incentives for farmers, particularly small farmers. All that is paid for in a way which is particularly appropriate at present when we are approaching, we hope, Common Market membership, when we have got to adjust our thinking and our general financial attitudes to the way things are done in the Common Market, when we have to begin to think in terms of added value tax as the principal source of revenue in future years.
I was very happy, indeed, to see that the Minister kept away from direct taxation and began to adapt this country and the people to thinking in terms of the added value tax. It was unquestionably the most appropriate tax to put on and equally it was the fairest tax to put on. So far as I can see most of the disagreement on the opposite side was that there was not enough of it put on.
Could we settle the bank strike and the cement strike?
I was interested to note that the Opposition while discussing the Budget failed for 90 per cent of the time to refer to the provisions of the Budget. Instead they spoke about inflation and about the general economic situation, about general economic difficulties and all the rest, but they shied away from the Budget. Of course, I can readily understand why they should shy away. The fact is that the Budget has taken the wind out of their sails and shocked them to the core. They realise that the country has been run properly for the past ten or 12 years and particularly that it has been run properly over the past 12 months.
Another aspect of the Budget which appealed to me particularly was the fact that the Minister for Finance— whom we all hope will be back in the House very shortly—was his own master as far as the imposition of taxation and the kind of reliefs or benefits to be granted are concerned. In this Budget he has refused—and I admire and thank him for it—to follow the advice of professional economists. Professional economists would have us sum up the situation as this: that if you impose more taxation you increase costs and, therefore, you increase inflation, but if you do not impose more taxation you increase inflation anyway. They would have the Minister in a vicious circle, racing around trying to catch his own tail. However, while he may not be a professional economist, the Minister is sufficiently practical in his approach to matters to realise the foolishness of listening to all this advice and sufficiently practical to sit down and draw up a Budget which will benefit the people and the economy. This he has done in a most remarkable way. He deserves the congratulations and good wishes of us all whatever side we sit on.
It seems to me that the previous speaker made the sort of political speech, in terms of party politics, which is the last thing this country needs at this time, or which the proper approach to our economic situation requires at this time. He has applauded this Budget unreservedly. Incidentally, I wrote down the sentence "the most remarkably fine piece of financial legislation that has ever been brought in." That is quite unreserved; it would be hard to approve more. I hope I have quoted the Parliamentary Secretary correctly. It is, of course, possible that the whole spectrum of economic opinion is wrong and that the Minister for Finance is right. It is possible, but I can only say that it is no longer a matter of the Minister's opinion, or the opinion of the economists or of the Parliamentary Secretary, or my opinion; it is a matter for unfolding facts of the next six to 12 months to reveal and the passing months in my view will reveal——
The Deputy said that last year, too.
It is possible it was said. I was not here on the occasion. I believe that this assessment of a remarkably and extraordinarily fine piece of legislation is entirely wrong in this case. In saying that, let me say that, of course, one can make little bits of superficial political mileage if one wants to pretend that members of the Opposition of whichever party are really opposed to the granting of improved social welfare benefits and really opposed to the releasing of large sections of working class poor people from income tax and really opposed to such concessions—very minor indeed; I will argue about that later— as were given to farmers. This is, of course, if one wants to debauch and degrade the level of economic and political debate in this country, a possible point of view but the kernel of the argument against the Budget is that whatever may have been given—and certain bits of it are to be applauded although when one looks at the small print one sees that it was nicely dressed up but turns out to be much less than it appears on the surface— will be eroded at a quite extraordinarily rapid rate by the inflation that this Budget has not alone failed to tackle but which it has, in fact, encouraged.
Perhaps what I am uttering about inflation are truisms that are obvious to everyone but since it has appeared possible for Deputy O'Malley and others to applaud the line of action in the Budget I may, therefore, spend a little time in trying to spell out from a Labour Party point of view why it is that inflation is so intensely objectionable to us.
If a person has assets in an inflationary situation the assets appreciate. If a person is without assets, if his wages for the week are approximately equivalent to his expenditure for the week, if he is in the circumstance where a very large section of his income must go on food, housing and the narrow range of minor luxuries that are available to working people, then he is hit much more by inflation than a person who is better off precisely because there is no fat to be taken up and there are no assets to appreciate.
Mention was made of the by-elections. One might analyse where by-elections were lost or not lost. One of the things that struck me then before this Budget was the intense annoyance of every housewife to whom one spoke about the fact that every time she went back to the shops things were dearer. That is the way it presented itself to her and I think that is perfectly correct. The point is that that will get worse over the next 12 months, in my view— I say this regretfully—and it bears precisely on the weaker section. So that an interesting exercise is to compare the increases given in money terms and in real terms in relation to the inflation that has taken place over the last 12 months and that we can expect to take place in the future.
In assessing the significance of a Budget like this one must take into account that it has many purposes. A Budget has an obvious purpose of raising revenues for essential and proper public expenditure but it also has responsibilities, duties, that go far beyond that—the responsibility of ensuring economic stability, the responsibility of ensuring economic growth and, in the view of my party, the responsibility of ensuring income transfer, a more equitable distribution of income within a community. It has all those responsibilities as well as the more obvious straightforward matter of raising revenue for necessary expenditure.
In assessing this Budget one might look for a moment—I do not propose to dwell at great length on this—at the economic situation in the parts of the world that most directly bear on us. I think it is fair to say that if the United States sneezes Britain gets influenza and if Britain gets influenza we get pneumonia, economically speaking, in a sort of cascade effect in relation to our economy which is a small one and a weak one, relatively speaking. At this moment, surely, the economic indicators from the United States, pointing as they do in opposite directions, are such as must cause great apprehension about the stability of an economic system profoundly important to us but one over which we have no control. The rate of inflation in the United States is not as high as here but is of the order of 5 per cent a year and we have this happening at the same time as production is, in fact, sinking very slightly. We have an anomalous and disturbing situation in regard to the United States economy and in many ways we have this same inflation-without-growth situation or with very little growth in Britain.
It is for reasons like that, I would have thought, rather than short-term political advantage that the Chancellor of the Exchequer in Britain brought in a Budget that was described by the industrialists and bankers as being responsible and as being a rather conservative one in relation to the prospect of a general election. The interesting thing in the British scene is that the British electorate, with the degree of responsibility and maturity that they now have and the level of education they now possess, have responded extraordinarily favourably to Mr. Jenkins's responsible Budget but we can see from an examination of the economic scene in the United States and in Britain and from the reactions to it on the part of the financial authorities in Britain that indicators profoundly important to us but over which we have no control are pointing to a period of difficulty, of disturbance, and we see this inflationary process going on in many places.
Before resuming the thread of my argument I want to say a word about another observation by Deputy O'Malley, that is, that the Minister had refused to follow the advice of professional economists and that he was to be commended for this. I am far from being a professional economist. I think it is absolutely right that the primacy of a Parliament should be established and that the central responsibility of a Minister for Finance to take financial decisions should be seen to operate and should operate at all times. I want to refer to this statement because it ties in with similar statements that were made by another Minister a few days ago in a television discussion in which I participated with him.
Let me express my attitude to professional economists in this way—there are descending degrees of precision possible in the different sciences. In physical science, an immense degree of precision is possible. In the area where I was trained and work—biological science—less is possible but, still, extremely valuable statements can be made and the range of error can perfectly simply be indicated in the numerical method by which you express your decision. Exactly the same thing applies but to a greater degree in the area of economics and in the area of sociology. These are not exact sciences in this sense as physics is an exact science but to conclude, therefore, that the insights and calculations, the deliberations of professional economists are valueless in the guiding of an economy seems to me an extraordinary "know nothing" and irresponsible attitude.
Were I a professional economist not tied to any particular viewpoint but doing my job honestly and honourably in the light of the circumstances in which the country now finds itself I would feel extraordinarily slighted by this. I would feel the whole of my professional expertise and professional stature and sense of my own validity had been thrown away, had been disregarded.
While members of a party such as my own traditionally have been the least willing to accept the pronouncements either of bankers or economists and people like that, the range of real choice inside an economy is fairly narrow and every professional expert who gives his life to a subject is entitled to be listened to. I do not mean that we are moving into an elitist, technocratic society. I hope we are not. Neither are we, I hope, moving into a society where economic decisions affecting everyone are made either for party political interest or by a process of denying that valid forward thinking is possible and that, therefore, you can close your eyes and use a pin or that, therefore, you simply do something that commends itself on the basis that it is easy to administer.
I would, therefore, from these benches, like to say something in support and in commendation of the body of economic expertise that has grown up in this country and that is profoundly valuable to us. If the Minister for Finance and his party do not do so, I hope that the nation cherishes their work and that we expect them to give us useful guidance in the future. That is enough about the role of the professional expert in an area like this, whatever his expertise may be.
I wish to go back now and talk about the perils of the economic situation that we are now facing. In doing so I shall endeavour to avoid the repetition of points that have been made from these benches during the debate. There are many points on which I shall not speak because their significance has been emphasised admirably and with simplicity beyond the need for repetition.
With regard to the central assumption, I see danger signals in the American economy, just as I see them in the British economy. All of the people to whom I, as a responsible public representative, have to listen also see danger signals in the Irish economy. Yet, if this Budget is to work out, there are two assumptions that are questionable. It seems to me that not alone is continuing inflation accepted in the Budget but it gives the Government a vested interest in seeing that that inflation continues, because it is only on the basis of two things happening simultaneously that we can avoid a very severe crunch in our external balance of payments and, worse still, in the earnings of industry within the 12 months. We must assume that economic growth will continue while inflation continues or the Budget makes no sense.
There is a world league table in the rate of inflation. The British have a more rapid rate of inflation at present than have the EEC; and if we are aspiring to join that economic grouping or if we are preparing ourselves to do so, every bit of inflation here that is more rapid than theirs puts us at a disadvantage. In the United States and Great Britain, where economists reckon there is a severe crisis from this point of view, the rate of inflation is considerably lower than ours. While I am not a professional in this area and while I have not made a world league table in regard to rates of inflation, there is some evidence to indicate that we have the highest rate in the world.
A point about this and one which has been made before is that this rate of inflation renders us unable to compete on the British market at a time when, due to the working out of the provisions of the free trade area agreement, any remaining protection we have is, in the course of time, being dismantled. Already. we can discern in the economy the deficiencies which the Labour Party discerned in the free trade area agreement at the time it was made. Even if our rate of inflation was the same as that of Britain we would suffer a disturbing deterioration in our economic conditions vis-á-vis Britain. With the implementation of the agreement, with an already high deficit and with a faster rate of inflation we are arriving at a situation where, when the professionals tell us there are many perils in our economy, we must accept that warning.
While one welcomes some of the provisions of the Budget, especially in regard to social welfare recipients and the lower grades of those who pay income tax, it seems to me that the great core of the criticism lies in the fact that it is impossible on this basis simultaneously to guarantee economic growth with economic stability. As I see it, both cannot be reconciled in this Budget. I am not making this criticism in sharp party political terms, but I believe that there will be a very severe political battle to be waged during the next year on the basis of the correctness or otherwise of the measures inherent in the Budget. Either the Parliamentary Secretary's analyses are correct, either the analyses of the Minister for Finance are correct that the inflation plus the economic growth can be contained and that, therefore, no savage cooling of the economy becomes necessary within the 12 months, or they are both wrong, in which case certain things will have to be said about the Budget in party political terms. However, I am not embarking on that exercise at this time. Rather, I am trying to outline the great central criticism of the Budget as I see it.
That leads me to speak on two other topics—about the way in which necessary revenue can be raised and about the Devlin report. First, to suggest that because of superficial similarities a turnover tax is something of a preparation for an added value tax is rather shallow. They are both forms of indirect taxation but beyond that one is not really much of a preparation for the other. One cannot defend turnover tax on the basis that it prepares us for the EEC. There are traditional and, I think, valid objections on the part of socialists to indirect taxation. This, of course, is not a total objection and one admits the role in certain circumstances of properly organised taxes. But when we say that we accept the EEC without criticism, we must also say that the thinking of the EEC is, to a great extent, the thinking of the industrialists. That body is not yet a democratically structured organisation. It does not yet have a representative directly elected by a European Parliament and it has not yet been made answerable to the needs and the interests of the organised Labour movement of the six countries. The fact that they adopt a particular taxation system is in itself no argument for that particular system.
The fact that the turnover tax bears a superficial resemblance to an added value tax is no argument for the turnover tax. An effort has been made to present this Budget as the most remarkably fine piece of financial legislation ever brought in and, because of that, it is worth repeating our objections to a tax of this sort. It is a tax on practically everything, with a few insignificant exceptions, from the point of view of what the average household has to buy. It is a tax on bread, on tea, on sugar as well as being a tax on petrol, on cigarettes and on beer.
Why did the Government, it is asked, not increase the tax on beer, cigarettes and petrol? The fact is that they taxed all these and everything else as well. The great objection to this tax is that it is discriminatory against the lowest income groups. It is not a redistributive tax that takes from where there is a surplus and gives to where there is need. Rather, it aggravates the need at the lower end and bears less heavily in those areas in which there is already more than enough. This is the core of the objection. It seems to me contradictory to relieve income tax, though I welcome the relief, on the one hand, in the case of the income groups and then replace that relief by an indirect tax. This is an inflationary form of taxation; it bears most heavily on those least able to pay. It does not conform with what I consider to be the essential of a good Budget, namely, the redistribution of income from the richest to the poorest. There is none of that. There is the opposite. From that point of view it seems to me an objectionable Budget.
I come now to the question of where the money should be raised. If this is presented as a Budget which prepares us for entry to the EEC, then someone is out of step because it will have the opposite effect. It will make us less ready, less competitive and less able to hold our own in the EEC situation. The kind of taxation we would wish is the kind of taxation forced on us as a result of EEC negotiations, not for reasons of which socialists would approve but nonetheless the inevitable outcome of EEC negotiations. Industrial growth here is based on the premise that you offer a location, labour and facilities to foreign firms, with a tax free holiday until 1990. The capital is, of course, desirable. So is the expertise. It can be argued that the price is too high unless you simultaneously build a much stronger public sector in industry. It is not that we are opposed to industrial development, to foreign capital or foreign expertise or to marketing opportunities, but we believe this is fundamentally a very dangerous way in which to develop.
The rules of the EEC in regard to equal competition are such that it is very unlikely we will be able to negotiate our tax holidays up to 1990 into the EEC and it, therefore, seems to me obvious that we should seek to raise revenue, as many other countries do, from those sections of industry not now being taxed. We should seek to raise revenue, as many other countries do, from taxes on capital gains of various sorts. We are not now talking about the effect of a few pence on the pint or on the packet of cigarettes. We are talking about very large potential sums and I believe we should seek to raise these revenues specifically in the surtax area, the richest area of the community.
The financial expertise of the Minister for Finance was referred to. The Minister for Finance has people to advise him, people with an intimate knowledge of the situation in other countries, countries in which revenues are raised from taxation on capital gains and these revenues run into very large sums indeed. The argument, therefore, that the only place in which you can get £20 million is in the area of the turnover tax is a specious argument; the increase in turnover tax is estimated to bring in £20 million. This is a very specious argument. It offends intelligence.
If surtax were doubled one would get another £4 million or £5 million. That is all. What is the Deputy's estimate of what one would get from a capital gains tax?
Which is the Government and which is the Opposition in this House? It is the Government's job to budget.
For me to offer advice without a fair amount of investigation would be a piece of superficiality. I would not dream of offering an estimate as to what tax would yield this or that amount. That is not an exercise to be done in this House. It is too serious.
I turn now to the effects of this Budget on the agricultural community. It was a little unedifying to see the way in which various figures were hawked before the by-elections. To an overwhelming extent farmers' incomes are now determined by Government decision. Farmers, unlike other sections, are not in a position in which they can indulge in collective bargaining in response to an inflationary situation. They cannot say: "OK. You took 7 per cent out of our pockets by permitting inflation and we will have to get 7 per cent back in our pay packets." That is not something farmers can do. The effect of inflation on farmers is to diminish real incomes, and this diminution of incomes cannot readily be redressed. The effect of the turnover tax will be to put up farmers' costs directly because it will raise the price of everything they have to buy, with a few insignificant exceptions. If one is, therefore, doing a sum of addition and subtraction it is only fair to express in real terms how much money is being taken out of their pockets by a continuing inflation and balance that against the money offered to them in this Budget.
As I said earlier, one of the objects of a Budget is to ensure economic growth. What is happening now is that a large amount of public money is being spent in the countryside. This is quite proper and absolutely justified but my conviction is that, in the long run, cheap food is as much in the interests of an industrialised EEC as it is in the interest of industrialised Britain. There has been a reduction in the price of butter in the EEC. There were good political, social and economic reasons for creating butter and other surpluses by holding prices over a decade and letting inflation produce a diminution in real prices, but the European prices of agricultural produce of significance to us will come down in real terms.
The more intense modern type of competition on a productivity basis will break out inside EEC, as has already happened, and many Governments are spending a lot of money on re-structuring small farms. When you have an industrial pool you have the prospect of moving into an industrial, urban environment the surplus people squeezed out of the countryside. This is the situation in EEC. They can soak up the people squeezed out of the countryside and take in Turks and North Africans and others also because of the high rate of industrialisation. But to achieve real gains in efficiency what I might call, if I am permitted to use jargon—if it is acceptable in the case of Professor Galbraith it is surely acceptable for me to use it—modern capitalist farming will break out as distinct from small proprietorship farming all over EEC. It has happened already and it will become more intense. Therefore, if we really want, by means of budgetary policy, to prepare ourselves for entry to EEC we must spend the large amounts of money from public funds now being put into the countryside, to buy increased rationalisation, efficiency, productivity, output and power to compete and, therefore, hold our own in an EEC situation. Our farmers assume at present, on the basis of looking at prices, that this will be an advantageous situation. Indeed, it will be advantageous for a year or so but it will not continue to be advantageous when the big grain farmers, cattle farmers, milk producers and big horticultural combines really get steamed up and get their costs down very low.
The point about EEC policies in regard to the price of goods is that a price differential system—not a two-tier milk price but a many-tiered milk price system such as we now enjoy—is not permissible under EEC regulations. The present differential price system, of which I approve in principle because I think there is in it an element of redistribution and social justice, could not operate. I think you will have to graduate the size of the steps in a tiered price system to push people on to larger units, greater efficiency and productivity. Anything that halts the evolution in the countryside to a really competitive position, far from preparing us for EEC is in fact perpetuating a situation in which we are unprepared and this I think will have very serious long-term social consequences. The financial provisions of the Budget in regard to the countryside are such as to perpetuate existing supports of a political character which are not such as to produce, as a result of the expenditure of a vast amount of public money, the sort of evolution in productivity and efficiency that would fit us for the Common Market. They are counterproductive in regard to the real needs of the Irish countryside.
Turning to the Devlin Report I wish to say that for five years I was an established civil servant. They were years for me of extraordinary bitterness and frustration so that I come to this theme with strong feelings. I shall endeavour, having declared their existence at the outset, not to let them cloud what I have to say. I should like to applaud and endorse in this respect what was said by Deputy FitzGerald last night. It is profoundly important for us that we have a public service of the highest quality, not simply as a statement of abstract desire, but because that public service will be exposed to competition and measured against public service in other European countries in the near future if the proposals that are so—to me— lightheartedly endorsed by the Government are, in fact, carried out and we become members of EEC without a great deal of in-built protection. The Government attitude seems to be to accept EEC in toto and all we negotiate about is the extent of our representation and the duration of the transition period. If that happens we shall measure our public service against the public services of other European countries and if it does not measure up it will be to the detriment of the whole nation.
There was some discussion last night about what was the kernel of the Devlin Report. It seems to me the kernel is the suggestion for the setting up of a Department which is itself responsible for the structure of the public service and which is not answerable to the secretary of the Department of Finance and Minister for Finance—the need for the establishment of a separate Department with a separate secretary. From my own point of view, this is not half enough and I shall say why in a moment. What worries me is that already this demand of the Devlin Report, which seems to me to be the precondition of the further evolution I desire in the public service, is being swept away and watered down. It seems to be yet another example of the Government bringing in people, calling on their expertise, accepting their work and then casting aside the result of that work with very little discussion or analysis and very little explanation of what they are doing.
This essential recommendation of the Devlin Report is, in fact, being swept under the carpet and this I greatly deplore because even if everything in Devlin were done tomorrow we should only be at the beginning of the sort of evolution we need in our public service. If I were to say what we need in it, it is, in one word, democracy. We could spend many hours in this House trying to explain what the real concept of democracy is because it is a concept that is growing in depth with every year that passes. If at its most simple, etymologically it means the rule of the people, then in the public service there must be participation in control by those employed at all levels. In other words, there is a basic contradiction between a completely hierarchically controlled system inside the public service and the democratic system outside.
If democracy is really to have meaning in our society it has to be democracy in all the places where people work together, not just democracy in Parliament and local government but democracy in field and farm, in schools and hospitals, but above all, democracy in the largest single bit—to use the computer programmer's term—of our State which is the public service. This means there must be a great deal more openness, more exchange and availability of information and an ending of the sort of thing we saw at Question Time today. This was a case where public money was spent and an outside expert was called in and as a responsible expert used the money of the public for certain deliberations about a question of national social importance and, when a responsible Deputy asks to see the document in question, the Minister can simply say: "No" and totally resist pressure to lay before responsible people the results of these types of investigations.
There has to be much more openness in regard to information and there also has to be much more openness in regard to the interchange between different sections of public life. There are countries in the world where public servants, business people and people from the academic life can move backwards and forwards and interchange ideas and give each other the benefit of their experience and expertise. This seems to me to enrich those three bodies: business, the universities and the public service.
There is always an organisational block against the institution of reform. I do not want to spend time resaying what Deputy FitzGerald said eloquently and at times very amusingly about the total absence of reform in the public service during the life of this State. Of course, there has been piecemeal reform but the block against reform at present is a structural block of control within the Department of Finance. Therefore, the key to the introduction of the sort of democratic reforms I am seeking in the public service is the abolition of the immediate block in the Department of Finance and the setting up of a new Department with a new secretary totally outside that tradition. There is no need for us to copy everything British and, indeed, the British have been very far behind other countries in matters of public service reform, but this is something they have found it necessary to do.
I am not now arguing the question of what Minister that Department and Departmental secretary should be answerable to and I am not now arguing the question of whether we need a new Minister. I am simply arguing for the implementation of the Devlin recommendation about the need not for a unit, which is the phrase used in the Minister's speech, but for a new Department because, as I say, not alone is there a block in mind, in tradition, and in method, but there is also an actual structural block. Nobody suggests that the sort of evolution into democracy in the public service for which I am pleading can come easily or quickly. Real democracy in which people can participate fully at many levels is something which can only slowly evolve. It is valuable to the extent that right from school people are taught to participate. It will be slow to come but it is essential for the well-being of the public service and the well-being of the nation that it should come. Therefore, it is essential that its introduction is started and started soon. The great block to the beginning of its introduction is the present structure of the Department of Finance.
Finally, I want to turn back, in gentle and speculative terms I hope, to the question of why this Budget was introduced, the way it was introduced and the time it was introduced. On the face of it, it is hard to explain. I do not believe that the Minister for Finance stood aside and said to his technocrats: "Go ahead. Produce a Budget for us." I do not believe he is that sort of man. With two by-elections over and with a general election, perhaps, at the end of the full term of this Dáil, or, perhaps, the Dáil may not go its full term, certainly with no general election in the offing immediately, it is not a Budget designed to win a general election. It is not what you might call a Civil Service Budget. It is not a general election Budget. While it has exceedingly short term attractions, it presents us with the most profound dangers in regard to stability and economic growth and development over the next 12 months.
Therefore, it seems to me an irresponsible Budget at a time when a much more responsible Budget could have been introduced. I am to some extent mystified by the political motivation behind it because I believe that, at bottom, it is a political Budget and not a Budget produced by financial people with a perspective of the whole economic needs of the country. I can only surmise that the Minister for Finance—and in passing may I wish him well and wish him a full recovery so that he will be back in the Dáil soon—is in possession of information which the House does not possess and that we are at the opening of a period when new political facts will emerge on the horizon. We can then judge this Budget which cannot be praised or even understood in terms of long-term need. We can then place it in the context of the political requirements which dictated it, whatever they may turn out to be. We can only speculate on what they may be. There is obviously some reason for producing a Budget which so signally failed to guarantee the two great requirements of a Budget: to ensure the continuance of economic growth and to ensure economic stability.
I also wish the Minister for Finance a speedy recovery and I wish him well in every way. On this side of the House there is no enmity towards him at all. I find myself very much in agreement with Deputy Keating on the need for a safe Budget this year, a Budget that would not impose too heavily upon the poorer sections of the community and would not impose too heavily upon people whose incomes cannot be adjusted, those self-employed people who still constitute the majority of our population and, at the same time, would keep our competitiveness as we move towards freer trade and leave ordinary business people and ordinary industry in the position of being able to continue to preserve a profit, preserve employment and improve employment, an objective at which we all aim.
We were told in the papers this morning that the Minister for External Affairs has been assured that we will go into the Common Market together with Britain. This means the free movement of men, money and goods within a very large area, possibly an area almost as big as the United States of America. In such a context, competitiveness is all-important, particularly in the case of a small nation that cannot have a great influence on the moulding of this great community in the future and which will have to "go with the boys as the boys decide to go". Because of the size of our country our industries cannot be huge industries. In the engineering industry we can have light industry only. Except in one instance we do not make huge ships or huge machines. If you use the word "make" in its full context we do not make motor cars. In fact, our competitiveness, our journey on the waves of economic safety in the years to come, will be decided not by our motivation but by our inclusion in a freer area of trade with the British Isles and with Europe.
I want to warn the House that 18 per cent only of our work force is involved in the production of goods in industry. The figure in Britain is 38 per cent. There is no magic wand we can wave to change things overnight even if there were power in Government circles, which there is not, to do anything about wage increases.
I do not even believe in the consumer price index. It includes many items not in general use today and excludes many which most of us would regard as the normal needs of daily life. The real cost of living, the cost of ordinary spending, has increased spectacularly, far above the figures which have been circulated to us in the last fortnight. We have been on a wage spiral and I shall speak later about this.
The milling industry—I am an employers' member of the joint labour committee—has had the average experience so far as wage increases are concerned. I am not against wage increases, I am for a prices and incomes policy. To view the present situation in its proper context, the position in the milling industry was that for the 18 months ending 4th April 1970 there had been a price increase equal to 35s plus many side benefits. From the 4th April onwards the position is that there will be an increase in the next 24 months of £4 plus 35s plus side benefits which means an amount approaching £6. I have been nauseated by the inaccuracy of the argument here that if production increased by four per cent it was possible to give a similar increase in remuneration. It might be possible to give an increase of 1 per cent or of 40 per cent because you have got to take into account the wage content of the production in which the person or company is engaged. This can vary from 10 per cent to 90 per cent and it must be examined in detail. The Taoiseach in producing these figures is not fooling anybody. The position is that the assessment of what could be afforded is extremely difficult.
I condemn this Budget as inflationary and dangerous in regard to the preservation of jobs. We are in a competitive position. We have had confirmation from a responsible member of the Government today—with the exception of the Minister for Finance possibly he is the man on whom most of the responsibility rests—that we are going into the Common Market with Britain. If this is so, then this Budget which will raise our costs is dangerous to the preservation of jobs, much less the creation of new ones. It has been accepted by all the business organisations that the general increase as a direct result of turnover tax will be of the order of 4 per cent. People in the retail business who have been absorbing the 2½ per cent cannot afford to absorb 5 per cent.
It is a conservative estimate to suggest that the increase directly resultant on the changing of 2½ per cent to 5 per cent by the Government will be of the order of 4 per cent. If this is so, there is also the increase in costs due to wage increases. I estimate that such price increases will be on average from 10 to 15 per cent. This is a fantastic amount and is something we have never had to budget for before. It will not be seen in its full brutal force until next January but it is there.
I was involved in certain negotiations in the Labour Court in this regard and I sat beside one employer-member who told me that the wage increase in the first instance was exactly 1½ times the net profit of his company. Because the wage increase will be greater next January and April he now has to seek approximately 1¾ times his net profit. For obvious reasons I shall not mention the name of the company but it is highly successful, operating in the middle of Ireland is what is relatively a rural area. There is no replacement for it, unless somebody has a magic wand, if that industry cannot do what its managing director said was necessary.
The present situation, whereby we have an inflationary Budget in the circumstances now obtaining, is serious. A situation exists that companies are faced with a loss based on their net profits of previous years and the situation cannot be retrieved merely by increased efficiency and production or wiping out profits but can only be achieved by a spectacular price increase.
I do not know where we go from here but it is quite clear that there was a need, as my party pointed out seven years ago, for a prices and incomes policy. People have been critical of the British Minister, Mrs. Barbara Castle: some have suggested that she failed. However, the fact is that Britain has got out of her difficulties. A prices and incomes policy does not have to be 100 per cent successful to succeed; if you can get people partially to agree with you on such a policy and get it partially through the complex economy of all modern States that every movement towards that goal is good and is against the erosion of people's wages and the value of money then you have succeeded to some extent. The situation will affect those people who are in small self-employment and who cannot by their will and their power increase their own incomes. This group of people, whether they are farmers, small shopkeepers or persons producing services, are still the largest group within this country and they are the people who must bear the effects of the wage increase spiral.
A prices and incomes policy is a must for this country and I charge the Government with grave dereliction of duty in not having produced it years ago. They have been in office for long enough; the last interruption was in 1957 and this is now 1970. In the Government's Review of 1969 and Outlook for 1970, at the back of the book there are a few pages devoted to an incomes policy. There is not one word about prices although prices and incomes are directly related. We all know what the wage spiral plus turnover tax will do to the goods we have to buy. Even though we have only a relatively small proportion of our working population—18 per cent —involved in the production of goods in industry, these increases plus the increases generally applied by the Government will mean a heavy impost on a section of the community who must bear it from incomes they cannot control.
The need for a prices and incomes policy is apparent. It must have the support of the people and must be seen to be fair. This Government have not done anything about it and that is one good reason why the sooner they get out of office the better.
The Government must also be seen to be adhering to a prices and incomes policy irrespective of political considerations. When the Government and the Taoiseach say something it should mean something. Then more people will listen to them. If it is a case of getting around the corner of the next by-election or the next general election or just throwing a figure up like a mad hatter, then people will not adhere to it and will regard their right as that of the pressure group, that of the vested interest, whether it be that of the proprietors, persons who own industry, or whether it be strong trade unions or craft unions who have a stranglehold on a certain production. All these people will merely use their brute force and power rather than come together and decide that one of the things that happen from the incorrect use of their brute force and power in the increase of money incomes is that the value of money is eroded and that they get only paper money, and the better thing to do, even if they want to think selfishly, is to accept a prices and incomes policy based on what, in agreement and by long consultation with all the interests concerned, the country can afford, and thereby preserve the value of money. That is the salient factor. That is the thing the Government have not mentioned in any of the volumes they have circulated. That is what has been promulgated in the NIEC document No. 28, which has not been mentioned except from these benches, and that is the only saving of this country.
A prices and incomes policy must work two ways. It must work on the powerful trade union which desires to get more than its due share of the fruits of production for its members. It must work as well on the powerful monopoly that, perhaps, desires to get too high dividends and too high a reward for putting up the money, providing the management and the risk involved. They both must see to it that the money they get is no longer paper money. This Budget—I agree with Deputy Keating—is incomprehensible. One could, perhaps, call it a political Budget. Whether there is another contest coming I do not know, but I shall not discuss that here.
Again in relation to a prices and incomes policy, when one looks at the balance sheets and the profit and loss accounts of public companies one finds that, relative to the wages paid and the costs of raw materials, profits and dividends are extremely small, and that if there were to be a 10 per cent increase in wages, even without an increase in prices, very often profits and dividends would be wiped out entirely. The trouble here is more severe and more serious than, perhaps, the wiping out of some rich man's profit, because, whether we like it or not, we are living in—it seems to be a dirty word—a capitalist society on this side of the world and money is money on risk. I want to suggest that nothing, neither the land of Ireland, the money of Ireland, the factories of Ireland, compare in their wealth and in their production of wealth with the work of the people of Ireland. Therefore, they are fully entitled to the larger share, but it must be borne in mind that the old slogan "Take the profit away and distribute it to the workers" just does not work any more, because it is so small it will make no material improvement in the lot of the workers in any given industry.
That brings to my mind the old story about Rothschild who at the end of the French Revolution was called on by three gentlemen who told him they were not going to chop his head off but were going to take away all his property. They hoped he would work and help them in the building of a new state. He would no longer own anything in the building in which they called upon him or any of his vast empire of land, factories, rich and rare objects. Rothschild said: "Thank you very much, gentlemen. Yes, I will work with you and help as best I can to build up this new state. Now I want to give you all your share", and he produced from his pocket five sous, the one-hundredth part of a franc. This was based on the mathematical formula that the vast Rothschild estate in France was worth the one-tenth part of a halfpenny per person at that time.
The Government and the Minister for Finance should have faced the fact that we were on the dangerous road to ruin, where we had nothing to distribute, and where we should have been selectively looking for the corrective measures which would not hurt people in the community who need bolstering up economically, but would do the trick that Mr. Wilson did, put this country back in surplus on balance of payments, as was done in Britain under the most difficult circumstances in the last 18 months.
The Leas-Cheann Comhairle who was with me at the Council of Europe will remember a paper by a Frenchman which impressed me very much. He proved mathematically that by ordinary budgetary devices Britain could not be ready to enter the Common Market inside 12 years and the only way she could get into the Common Market within 12 years was by budgeting for a large surplus in each of the 12. It has been done by another artifice, very difficult for us. The Government had to put commercial deposits on imports into Britain to stop people exporting goods there. People who were sending goods to Britain from all over the world decided to send them somewhere else. It might suit us a lot better if we drank a bottle of beer manufactured here instead of a glass of wine, or if we drank a small whiskey instead of a small brandy. Those are just two of the luxury items that come to mind.
These things could have been done, and I shall refer to what was done in 1956-57 and the lie that was perpetrated, and by that I mean a deliberate falsehood by certain political people at that time. If there is to be a prices and incomes policy the Government must accept there must be included in this policy the right of those who are unjustly paid to correct their situation vis-à-vis their fellows. That is the opposite line of country to the maintenance strike or to the case that has passed into history now, the famous sugar cook situation. Something similar to the NIEC, with trade union representation, business representation, Civil Service representation and representation from other sections of society, could have been a framework for this. There could have been the right for persons unjustly treated to try to correct their lot.
There would also have been the clear duty devolving, in the last analysis, on the Taoiseach to speak out clearly against those people who by their vested interests, as I have said, whether they be trade unionists, rich industrialists or whoever they may be, desire to take too great a slice of a cake that is not baked yet, which we have had to pledge by borrowing abroad because of the amount of capital moneys needed to build up our State, and with which I do not disagree, except for the fact that we lose a lot of income tax from the dividends which people get from our loans when these dividends go abroad.
Somewhere along the line there must be a reckoning, and this was the time when the reckoning was overdue and when a realistic and a kindly approach could have been made in this Budget of 1970. It would have paved the way towards our entry into Europe, towards the culmination of the Anglo-Irish Free Trade Agreement and, perhaps, a better deal for the majority of our people who have got a worse deal.
I regard the work of the people of this country as worth every stick, stone and sod and more and more besides that. It is their right to seek a decent living therein and they have every right and, indeed, a responsibility to their families to do so. However, at the same time we are creating an economy in which there is no incentive for investment or for people to come from abroad to invest money and to employ people. There is, in fact, a disincentive. The other day I had the pleasure of sitting near the Minister for Industry and Commerce at an official opening of a factory and the Minister to some extent boasted about the fact that there were 16,000 more people in industrial employment now than there were last year and that this had, for the first time, or the second time, counterbalanced the number of people leaving agriculture, namely 12,000. We created 4,000 new jobs but do you realise how much we spent on that last year? We spent £33 million in grants.
Can we continue to do this at this rate? I hold, on the basis of the capital budget and on the basis of what is being done, that we cannot continue to do this. What I have been saying for some years is that the climate for growth in industry and for the creation of jobs is more important than all the grants you can provide. Of course, freedom from income tax for new exports is an incentive. Unhappily when we enter the Common Market it is probable that it will not be possible to continue that incentive; we may be able to continue our grants. It is utterly impossible to bring our State to the condition in which we would like to see it on the basis of an expenditure of the magnitude we have seen and an increase in real terms of only 4,000 new jobs.
The Minister was speaking at a very successful factory. These were excellent people who came from abroad, started in a very small way and have done very well. What the Minister was talking about represented exactly 20 times the number of people in that factory through which we walked in 20 minutes. This is a nation and nations succeed on the basis not of handouts but of good, sound economy and nothing else. On that basis and on that basis only this Budget stands condemned. I am now going to tell a story and again, of course, I cannot mention names. A certain gentleman died and about three weeks later his secretary telephoned me and said: "Mr. So-and-So's partner in London is in very great distress over the industrial situation here. Production has stopped because of a certain situation here and he wants to talk to somebody about the position. Another gentleman mentioned your name and he wants to know if he can ring you up." I said that he could and that night he telephoned me. I told him all I could about the industrial situation and I gilded the lily as well as anybody on the opposite benches could do—and that is saying something. I made every effort to get him to realise that we were not all ogres here and that there was not a strike on in every factory. He replied: "Yes, Mr. Donegan, but I have had too much of this. If my partner were alive he would probably succeed in convincing me I should come here with the other £500,000 of our backers and start another factory. Do you know where I am going by plane next week?" When I replied that I did not he told me that he was going to South Africa, that it was safer there. This is what I am talking about in relation to the climate for growth. Our position as far as employing people today is concerned, leaving out Government helps, is that we are regarded in international business circles as being less safe than South Africa where you have 40 times as many black people as white people who are determined to get their share and the white people are determined that they will not get it. This is the sad situation in which the Fianna Fáil Government have placed us.
Now I want to refer in detail to the wage spiral. I referred to my experience on a joint labour committee. I wish there was such a committee for every industry. It is a good thing and while you may end up paying 5s a week too much at least you have the beginnings of discussions on a prices and incomes policy. We have ten people on the employers' side and ten people on the union side talking, with no votes, to independent members. I remember at one time, before he went into politics, the independent member was the Minister for Industry and Commerce, Deputy Colley. That was about 12 or 15 years ago. I can say what happened in relation to the milling industry apart from flour milling.
There was an arrangement for 35s over 18 months, which did not last for 18 months, and £4 over 18 months starting on 4th April last and then there were various side effects as well such as service pay and things like that. If we take 5s as the side effect for service pay, shift allowance and so on, it works out at £6 for two years. The unfortunate workman who had three children, not the man with four big sons who are working, and only one wage packet coming in, needed every penny of the £6. However, what has happened? It has been eroded and if he was taking home £20 in the last two years, £3 10s of that has gone.
I am fully aware that I am comparing different periods because I am comparing the last two years as indicated by the rise in the consumer price index, as indicated in the documentation we got before the Budget, with a period of one year behind and one year in front. We can now look at what is going to happen in the year ahead. The sum of £4 has to be found where £2 had to be found. I have told the House that one employers' member told me that he now has to find one and a quarter times the net profit and next year one and three quarter times the net profit. Where is he going to get it? He is going to get it in increased prices. What did the Taoiseach say? He said 7 per cent or 30s and a fortnight later the paint manufacturers were recommended by the Labour Court to pay an increase of 23 per cent. We have a saying in our county in relation to the Rockabill which is known locally as "the cow and the calf" that a man who is away off the line is as far out as the cow and the calf. In this instance the Taoiseach was not as far out as the cow and the calf; he was as far out as Holyhead.
The Minister for Industry and commerce has indicated that there is to be no increase above the figure of 7 per cent or 30s when it is written into the cost of products. Over 18 months the industrialist has had to pay anything from 13 per cent to 25 per cent. I have indicated that in most cases if you examine the figures his net profit is a very small portion of his wage costs. Where is he going to get it? He is going to get it from prices. Mark you, the instances in which it is possible for the Minister for Industry and Commerce to control prices are limited. He is able to control the price of a stone of flour or the price of a pint of stout but, apart from those, he cannot control anything. Nothing works but a voluntary prices and incomes policy. Compulsion does not work. I suggest that if I go to buy a suit from a tailor similar to the one I am wearing and the cloth of the new suit is a little bit different in colour, and, if I paid £X for the same sort of suit last year and I am now confronted with a bill for £X plus 10 per cent, then if that is produced in evidence against the tailor he will be fined and told that he cannot do this. It would take what the ex-Minister for Agriculture, Deputy Smith, referred to—ten fields of inspectors to do this sort of thing.
If I have a pair of shoes the brand name of which is "Hogan" and they cost 70s and they wear out and I go the following month for another pair, the shop may offer me a similar pair having an extra eyelet or a slightly different sole pattern, bearing the brand name "Bogan" and they cost 85s, can the Taoiseach or the Minister for Industry and Commerce do anything about that? I say that they can do nothing and they have been doing nothing for the past 10 years.
That is the reason why the country finds itself in its present position. If the Taoiseach and his Cabinet had been bigger men they could have attempted to sell the idea of a prices and incomes policy on the basis of voluntary participation by all, accepting the fact that paper money is of no use to anyone and that a system of wage increases followed by price increases is of no help to anyone. Until that is done there is no hope for the country.
We have witnessed spectacular reductions in the net profits of public companies that shocked us in the last few months. During the Kildare by-election campaign I witnessed a spectacular loss that shocked me in the case of a company in that constituency. I have seen a satellite factory outside my constituency being closed. I have seen what had been a handsome profit in a certain industry turned into a colossal loss. The other day in the case of a company whose name is as old as industry in this country a colossal loss was revealed. At the same time, new factories, sometimes monopolistic factories, are in some cases producing fancy profits. Remember, if there is a profit of £10,000 in an industry in which the annual wage bill is £100,000 and there is no change, as is suggested by Deputy Colley and the Taoiseach, if the wage bill goes up by 10 per cent the net profit is gone. The industralist concerned immediately falls out of love with his bank manager and the bank manager falls out of love with him. That is not a climate for growth in industrial jobs. A prices and incomes policy is for voluntary participation by all.
The suggestion of a 7 per cent or 30s increase in the cost of a product is out of date. I could quote other situations that the Taoiseach might or might not know about in relation to price control. There is the story of a business man who had a very big business in a rural area. He had to buy the eggs from the local women because otherwise they would not have the money to buy the goods in his shop and his competitor would get the business. That was in the days when tea was blended or mixed and packed by the shopkeepers. When the loss on the eggs became intolerable the shopkeeper concerned reduced the quality of the tea. Yet, the simple man sitting opposite me now thinks that there is such a thing as price control. Mr. Seán Lemass in relation to a Budget at one time said that it was a sweet "Fanny Adams" Budget. The Government can do sweet "Fanny Adams" about price control. They may produce it in name but not in any real sense.
There was a famous case not so many years ago as to whether or not there were marrowfat peas in a packet. That case ended in a bottle of smoke. I do not know whether or not at this point of time there are marrowfat peas in a packet. For some of the basic industries where it is obvious to the consumer that goods can be controlled, a rigid price control would be disastrous. The trouble is that the Cabinet is a political Cabinet which has always been prepared to bow before votes. They would be prepared to introduce price control even though the results would be disastrous to industrialists unless the industrialists had the entrée to Taca or some other organisation about which the less we know the better.
I should like to talk very briefly on the question of the farmers. Farmers cannot have much control over their own income except by increasing production in an economic way. They are known to be the best people to live off their own fat. If things are going badly the farmer simply buys three or four cattle less than he did the previous year. He does not produce a trading account or a balance sheet. He continues in his usual way, selling a little less and buying a little less. He can continue in that way for a decade.
This country largely depends on the farmer for the supply of ready capital from abroad for the purchase of the raw materials for industry and, therefore, for employment here. Fewer people will be employed on the land and more people than we need will be employed in industry as a result of foreign money purchasing raw materials for industry. A bullock that is exported and that is worth £100 has a net cash value to the country of £70, whereas an industrial product valued £100 may bring nothing back to the country except a small amount of profit and the value of the labour it provided for our own people, which, of course, is an excellent thing. The export of the farmer's produce is the bulwark that provides the ready money for the purchase of raw materials for industries. However, when things are going badly the farmer does not increase production.
The farmer was down 3 per cent on agricultural exports last year. We hear about the incentives—the lime scheme, the fertiliser scheme, and so on. If a climate for growth existed in agriculture the farmer would have increased production. He has remained the same and has not made the extra effort.
Recently I was in the company of persons involved in the biggest fertiliser industry in this country who asked me why it is that throughout the country there is a low user this year of grass fertiliser. I have no doubt as to the reason for that. I realise that we must not engage in a discussion on agriculture at this time but I think I am entitled to state why the farmer is not increasing production.
If a farmer wants to get more wheat from a field this year he puts fertiliser directly under the seed and in that way increases the yield but if he feels that his bill next harvest or now, if he pays cash, for grass fertiliser, will affect his way of living, if he must pay his child's school fees he cannot buy fertilisers and for the next ten years he will have to live off his own fat. That is the situation in which the infamous Minister for Agriculture and Fisheries, Deputy Neil Blaney, has landed the basic industry of this country in 1970.
To get on to the question of beef subsidy; I am not at home to milk my own cows. Indeed, it would suit me far better if I did not have any cows but if I must pay four men to milk them I must get the money from somewhere so I find it necessary to keep 35 cows. If my cows were producing only 500 gallons of milk—thank God they are producing more—and if the average price was 2s a gallon, my gross income per cow would be £50. If I were to derive a gross income of £30 or £40 per beef bullock each year I would be doing extremely well and £16 added to that does not induce me to go from milk to beef because there is no guarantee after this year's Budget that the £16 subsidy will be continued. Therefore, if I, in my particular position, were to take advantage of the beef subsidy, I would finish up exactly where I was but if Government policy were to change and the £16 subsidy were discontinued I would be worse off. I am sure that the Taoiseach will not give us a guarantee of a subsidy of £16 for beef for even the next ten years.
I wish to discuss what should have been done for agriculture. We must prepare for agriculture within the Common Market and this will be a tough job. It is said that as far as beef is concerned we will be all right. That is fair enough but the figures I have given indicate that the income from beef is not sufficient on the small farm of today. The small farmer has fixed overheads and unavoidable overheads. We all know what fixed overheads are but the unavoidable overheads are the veterinary surgeon, a car, maintenance of milking machines and other machinery so that the farmer of today, while his fellow-farmer of 30 or 40 years ago managed to exist on a small gross income, cannot do so because he must have a greater gross income to cover not only his own net income but his fixed and unavoidable overheads.
Therefore, while it is excellent that we may get a big increase in the price of beef within the Common Market, the upgrading of farming and farm produce will require an enormous injection of capital. Some years ago when the Taoiseach was Minister for Finance he produced Budget tables before a Budget which indicated a drop in the capital available for the Agricultural Credit Corporation. At the time he informed me in reply to a question that the drop was not, in fact, a drop and that the resources of the Agricultural Credit Corporation and the return on loans from farmers plus payment on hire purchase machinery constituted another large income so that in the particular year there would be a greater amount of capital available to farmers. I forget what were the actual figures on that occasion but as far as I can remember there was a figure of about £5.4 million with £1.7 million to be provided by the Exchequer in that year. If we are to build up a farming bank here with particular interest for farming economy and if we are to add to it each year with capital sums from our capital Budget, we are doing what is right because we are increasing the amount of funds available to the Agricultural Credit Corporation.
However, what happened this year is that the amount coming directly from the Exchequer was reduced from £1,500,000 to £800,000 or less than half the figure as it was when the Taoiseach and I had our argument on this question on an Adjournment debate some years ago. On that occasion the then Minister for Finance, Deputy Lynch, was good enough to indicate to me that if the income of the Agricultural Credit Corporation were to fall below that which was estimated, the Exchequer would put up the difference. I now invite him as a poor substitute for what it should have been then to indicate the same on this occasion.
It is terrible to think that this marvellous farming bank that has done so much to propagate agriculture in this country should be put in the position now that because the pool of funds and the interest coming back constitute an increase in their funds, we, for our part, who need so much to develop farming, should reduce the amount of money coming from the capital Budget for their purposes.
If we are to go into the Common Market and produce beef at, say, 247s per cwt, we shall be in an improved position but if we are to do this in the old-fashioned way we shall not succeed. There is a great need for self-feed silage units and for the introduction of modern farming practices all of which cost large capital sums.
In the political and financial manoeuvering which is so much of a facet in the make-up of the Minister for Finance, one of the ways he has of saving capital moneys is to reduce by £70,000 the amount of money set aside in the capital Budget for the Agricultural Credit Corporation. If for no other reason, this Budget stands condemned because of this disgraceful action and its political stupidity.
If we are to make strides these are some of the improvements which should have been made in respect of agriculture.
Where then, if I am so critical of this Government and of this Budget, should the Minister have sought his remedies? The way in which Mr. Wilson sought his remedies has been briefly indicated. Something which might be howled at me by the Fianna Fáil people on the other side is that the levies were put up in 1956-57 and resulted in heavy unemployment. Of course, this is a lie and I now invite the House to consider the figures. Today, I have deliberately restrained myself and endeavoured to stay off the ream of statistical material which has been sent to us because, as the Minister for Finance said in his Budget speech, there is not much point in circulating it if we are to talk about it afterwards. The terms of trade in relation to the index import unit values are such that even if everything we bought from abroad was as dear or as cheap as everything we exported in relation to base 1953, 100, the figure would come out at 100. Our position in terms of trade in relation to 1953 now stands at 100.1. In other words, as far as the goods we sell abroad and the goods we buy from abroad are concerned we are basically in the same position.
Import levies had to be imposed in 1956-57. What were the terms of trade in those years? In 1955 we were at a discount, 97.4 per cent. Everything we sent out in relation to 1953 was worth only £97 10s. It is about time the lie was nailed and the reasons clearly stated showing why there was difficulty here. In 1956, everything we sent out was worth £90 8s in relation to the value of the things we took in from abroad, with base 1953. We were almost £10 in every £100 worse off in 1956. There is nothing one can do about international trading. In 1957, when the political wolves were howling—one of them is now present, and did he howl? —the value of the goods we sent out in relation to the goods we took in was £87 8s. I invite the House to consider what would be the position today in our present budgetary situation, with this illogical political Budget before us, if all the goods we were sending abroad were worth only 87 per cent of what we are bringing in. We are in quite a favourable position. Had we wanted to we could have attended to the things we buy from abroad. I have indicated the average wage increase and I now want to offer the opinion that the figure of balance of payments deficit aimed at in this Budget, to wit £50 million, will be far exceeded. There is no disincentive offered not to export consumer goods.
No incentive was produced to export the products of our industry and our agriculture, with the exception of the beef scheme, perhaps, which is merely the transfer of money from the amount spent on the subsidising of milk products to farmers who are voluntarily prepared to give up milk, maybe after grading up a herd, as I have done, for 25 or 30 years.
A selective tax could have been imposed if we needed money, as we do, for our unfortunate social welfare recipients. This tax would not have affected the cost of living unless people of their own volition wanted to have luxuries instead of necessaries. Why what was done was done I do not know, but I prophesy and I am an optimist—some people say I am an incurable optimist—that this day 12 months this country will be in serious trouble. It was stated in the Budget that if things were going wrong the Minister for Finance would not hesitate to act. The reasons why a prices and incomes policy was not introduced 18 months ago was that there was a general election pending. Everyone of the economic indices indicated that action should have been taken, not in this Budget but in the previous one, to put our economy on the right road, but there was a general election pending. As far back as the by-elections in Kildare and Cork the former Taoiseach, Mr. Lemass, indicated there would be a 12 per cent increase in wages. Three days before the election an increase was given to the Army in the knowledge that there was a large concentration of soldiers in both Kildare and Cork. I define this sort of thing as nothing less than political prostitution. The Fianna Fáil Government are prepared, for their own political ends, in order to hold on to their State cars, and for their own self-aggrandisement, to throw aside the things that need to be done.
How will the increase of 15 per cent as between turnover tax and price increases affect the majority, the people who have no command over their own incomes? The civil servants will get £10.3 million. Good luck to them. I was having lunch with one today and he asked me would I kindly find out if that meant about 30s a week for him. This figure of £10.3 million was taken out of a hat. Nobody has indicated what it is supposed to represent. The Taoiseach's figure of 7 per cent or 30s was produced like a rabbit out of a hat and the dog had chased the rabbit before a fortnight was out and the paint workers got 23 per cent. These are things that some politicians may, perhaps, be afraid to say because mention of them might be interpreted as a desire not to see increases in living standards.
This Budget could have been an important instrument for the future of this country. Time is running out. God knows, Fianna Fáil have what seems to be a perfect future—four years without an election, if they so desire. They could have applied the remedies. The remedies are not difficult. They could have made the position far easier for the majority of decent people. They could have set the climate for growth, the growth that is so desirable in both industry and agriculture, the growth which would permit us to give not just 17s 6d but 37s 6d to the old age pensioners.
The basic duty of the Government was to set the economy to rights. But Fianna Fáil could not care less. There was some mention at Question Time today of the Taoiseach ticking off his Ministers. As far as I can see it is a question of which Minister ticks him off. Deputy Dillon used to describe Fianna Fáil as this monolithic group that was just one great big block of sandstone. I have been here for 15 years and in every one of those 16 years in which Fianna Fáil were in office Deputy Paddy Burke, decent and simple man that he is, would say, when the division came after the Budget: "Ah, you are voting against the increase for the old age pensioners". In the context of about £850,000 out of £160 million I was horrified to hear the Taoiseach when he was leaving the Chamber this year pass exactly the same comment. We are not against the increase for the old age pensioners, but we hold that it is insufficient and if we had the opportunity we would give them more to help them meet the 15 per cent increase in prices which will result from this Budget. The snide comment was made: "Examine your consciences". The man who made the comment should examine his own, having allowed his Ministers to do whatever they like. We had the ex-Minister for Finance, the ex-Minister for Industry and Commerce, the ex-civil servant and now Taoiseach doing anything but what they should do. The Taoiseach has failed completely to put the country on the right road to prosperity. Whether that was because of fear of his Ministers I do not know. The advice I give is the advice given by Deputy James Dillon, possibly his last words in this House, and possibly the best advice the Irish people have ever got: "Get the rascals out".
Listening to Deputy Donegan it seemed that, briefly, his real problem is that this Budget should have been much more severe and should have provided greater impositions. I take it that in speaking from the front bench, in view of all the criticism he makes of the lack of unanimity on this side of the House, he is talking from the united front of Fine Gael. He tries to cover up at the end by saying that greater taxation could have been imposed in a nice sort of way. Throughout his speech he undoubtedly implies that the Budget is much too nice and too easy for Fine Gael's taste and much too popular in the country, from his point of view and presumably his party's point of view. They never speak in separate voices from the Fine Gael benches—at least that is what Deputy Donegan would like us to accept.
He implies that by not introducing a more drastic Budget the Government have some sinister motive and he tries to indicate as other Fine Gael spokesmen have done that the Budget will not be sufficient. Immediately the Budget speech had concluded we had the old cry: "There will be another Budget in the autumn." We heard that last year ad nauseam. We could understand what motivated the Opposition then to try to create the scare in the public mind that there would be a second Budget and that Fianna Fáil was running away from its responsibilities because it was facing a general election. On this occasion there can be no such excuse for the Opposition to make this groundless charge because they do not provide any logical proof to support the case they are making. They have fairly vivid imaginations when seeking out scares to create in the public mind but even in their fertile imaginations they cannot conjure up a political reason such as they are seeking to back up the sort of speech we have heard from Deputy Donegan and others since the debate began.
I suggest that Fine Gael should get wise to themselves and should stop seeking spies that do not exist under the bed. They should stop seeking plots that are not there and they should become fully involved in their own Parliament and as an Opposition assume some sense of responsibility.
After over 30 years it appears that they can never aspire to being a Government themselves. Could they not, after all those years, try in the year 1970, to be a responsible Opposition and so make this a better Parliament and help to remedy any shortcomings that the Government of the day may have? What Government have not shortcomings? This is their role; and after all their time in Opposition one would expect them to be accustomed to it and that nobody need tell them anything about it. My advice to them is that, if they are sincere in trying to do something for the country, they must work from the Opposition benches. They have no hope of crossing the floor. No amount of imagination or scaremongering, particularly 10 or 11 months after a sweeping majority for Fianna Fáil in the last election, will enable them to get across. There is no easy way to the Government benches: you must go out and get the people to back you and the people have not at any time since 1932 given any indication that they want Fine Gael as a Government. They should need no advice as to their true role which is opposition. They should try to be a little helpful and constructive. If they do spend the next 30 years assiduously trying to be a good Opposition, who knows but they might make a little more progress towards becoming a Government after that time than they have done by their total, critical opposition and the scaremongering they have indulged in on every occasion, this year being no exception?
We had the usual jibes about State cars and self-aggrandisement but these are the sort of jibes that members of any Government get from an Opposition with no sense of responsibility and no experience of being in Government themselves and no hope of being in Government in the future. Let us ask Deputy Donegan how he has fared in self-aggrandisement under this sinister Fianna Fáil Government in all these years. I should say that he has fared very well and good luck to him; may he do better in the future; but he should not use his position here, particularly the responsible front bench position he now occupies, to throw mud at a Government that has been doing its best and has been succeeding against various kinds of obstacles, not only the Opposition in the House— which is, indeed, the least difficult to overcome—but all the difficulties encountered in all the years that Fianna Fáil have ruled as a Government. We should like Fine Gael to do as the Taoiseach asked them on other occasions—put up or shut up when they start this mud-slinging. It would be better for the House as a whole if we had less innuendo, less mud-slinging across the House, generating in the public mind what I suppose some people in Fine Gael want, a feeling of insecurity for which there are no real grounds. I think this is the purpose of it and it is a base purpose which I think responsible members of Fine Gael do not support. However, what can they do when somebody appointed to their front bench, such as Deputy Donegan, sings the same old tune again?
The suggestion is made that the Budget was something brought about by a drawing of lots and that the £10 million earmarked in this Budget to cover public service pay increases in the coming year is merely a figure drawn from a hat. We have put it in the book and we are accounting for it in our Budget this year. We are not running away from the knowledge that there will be an increase to be met during the year and in the Budget we have provided this additional £10 million, in anticipation. We know the increases in the public service pay will take place as they have been and are taking place and will take place in other walks of life. It is this responsible attitude that Deputy Donegan would condemn and would ridicule by saying that it is a figure pulled out of the hat.
You do not pull figures out of the hat when you are in Government. A Minister for Finance does not have figures like that to pull out of any hat and a Minister for Finance who would attempt it—and, indeed, some Minister in a Coalition Government some years back attempted it—would realise eventually just how wrong it is, how stupid it is and what folly it is to try to pull figures out of a hat because, when the day of reckoning comes, as it does at the end of the accounting year, and the income does not balance up nearly with the actual outgoings, the trick is found out and the Minister and the Government responsible for that sort of trickery get their walking papers, as that last Coalition Government did.
Remember, they tried every trick in the bag to keep themselves in office during those three miserable years by cooking the books in various ways, in every possible way they could and, at the same time, they were trying to tell the people that everything was grand, that there was money for everything they wanted, that there was no question but that it was available. My own recollection is very clear on the subjects of housing and local government. We remember the débacle that was made of the building industry at that time. We remember very precisely the numbers of builders who were shoved into bankruptcy at that time, really by the action of an irresponsible Coalition Government acting on the type of mind that Deputy Donegan has displayed here today, pulling figures out of the hat with nothing behind them to sustain them.
When the day of reckoning came all the promises that were being made in September, 1956, could not be honoured by January or February of 1957. Of course, the boys deserted the ship, ran off it, scuttled off like rats leaving the sinking ship, and they left all this gory mess behind them for Fianna Fáil to clean up. What a mess it was. Only we in Fianna Fáil who had to take over directly after them fully appreciate it. Indeed, if we in Fianna Fáil, as a Government, wanted any lesson as to why we should never be tempted, for whatever reason, to try that sort of juggling with figures in the Budget, we had the clear evidence as to the sorry outcome of the 1956 budgeting with the gory details of unemployment and close-downs, and bankruptcy in the building industry to mention only that industry to guide us for the future.
This £10.3 million is, as I say, a definite actual commitment and provision being covered by taxation in the book of accounts, as it were, for the coming year. We are not running away from it. We are not in any way attempting to run away from it. We are, in fact, facing it before it has arisen. Surely this is prudence at its best in so far as the financial operations of the Government and the Minister for Finance are concerned. It is far from being what Deputy Donegan has suggested it is, some sort of trick in which there is no substance. He said that some civil servant eating lunch with him today was wondering what it was all about and would he, the civil servant, get 30s out of it or would he not. Whom does Deputy Donegan think he is codding? Does he think he is codding the public service? Does he think he is codding the public, or has he even the merest suspicion that he is codding the people on this side of the House into thinking that there is any substance whatever in the sort of talk that he has been at here this evening?
Could we also ask Deputy Donegan or those who will follow him—perhaps he will inform them because he has not informed the House—what measures he and his party would propose were they in a position to frame the Budget at this particular time? What method would they devise that would be less difficult, as he put it, than the increase in the turnover tax provided for in this Budget? Has he found ways that we do not know about? Has he sources of income of which we have never heard? Have Fine Gael really got the goldmine we have heard so much about in the past? Have they really got it after all? Are they holding it up and still hoping that they will get into Government and that they will then start reducing taxes and increasing services as we have heard them promise during election after election down through the years?
Is this really the truth or is it the myth that they are still trying to create and make the people believe in, in the forlorn hope, I put it, that three or four years hence they can replace Fianna Fáil as the Government? If they have any idea of coming across here they had better divest themselves of the myths. They had better get down to realities and start talking straight to the public and giving us the alternative to what they condemn in this Budget. Tell us what they would do in detail. Tell us where they would put the taxes on. Tell us what imports they would restrict, how they would restrict them, and to what degree they would restrict them. Let them tell us all that.
Let them tell us also how they would handle incomes, how they would curtail the increased percentage of incomes that many of our workers are enjoying today and are seeking at this moment and will come to enjoy before we come back to another Budget debate next year. Let them tell us those things and when they do, even if it does not sound too good, at least it will give some credibility to the story they are trying to put across that there is another and a better way of budgeting than has been provided by Fianna Fáil in the past week or so.
Let us look at Deputy Donegan's suggestion that an increase of 17s 6d in the old age pension is something to be sneered at. He says 17s 6d would read 37s 6d if he had his way. Let us not forget that they had their way, and Deputy Donegan was a Deputy then as he is now. Deputy Donegan's party were the dominating influence in the Government of those days when they had their opportunity, and there was no question of an increase of 37s 6d for the old age pensioners. There was no question of an increase of 17s 6d, but there was a question of an increase of 2s 6d over three years. No amount of talking in bigger figures than the 17s 6d in this Budget will ever eradicate from the minds of the public the fact that these great people in Opposition today were in Government and had the opportunity—and I am sure would have had the backing of the Labour Party—to provide 37s 6d if they were capable of providing the finance to pay for it. Instead, a miserable 2s 6d over three years was their entire and total contribution to the old age pensions at that time.
It was the first increase in 15 years. Fianna Fáil were 15 years in office and they did not put a shilling on it.
That is not true.
Look it up and find out.
Order.
I do not think the purpose of Deputy Harte's interruption is——
It is to correct the record.
——to add anything useful to the record but merely to try to interfere in some way with what might still go on the record, or to prevent some of what is going to go on it from getting there as quickly as I should like to put it there.
For 15 years Fianna Fáil never put a shilling on it.
Will Deputy Harte please restrain himself? If he does not cease to interrupt I will ask him to leave the House.
If it was an interruption I withdraw it. I meant it to be a correction.
The correction having been made the Deputy might listen to the Minister. I am sure the Deputy will get an opportunity of speaking.
A Cheann Comhairle, one has got to make a mistake before a correction can be made and I have not yet made that mistake since I started talking.
The Minister should consult the record.
Here we are with a correction being provided to a mistake that was never made. I want to tell Deputy Donegan again that, in their time, they did not give 37s 6d in any one year, or 17s 6d in any one year, but they gave a grand total of 2s 6d in three years, aided and abetted by the Labour Party who were the other partners, but the very minor partners, in that Coalition. I feel sure that the Labour Party would blame Fine Gael for not having given more. They would like to have given more, but the people who controlled the Coalition were the Fine Gael Party, Deputy Donegan's party.
It was a two and sixpenny Government over those three years, a tenpenny Government if you divide it by three. As it turned out in 1957, tenpence was a rather high valuation to put on the Government at that time. However, we had this sort of attitude again, the usual outburst from speakers from Fine Gael and round assertions after making claims about what they would do if they were here. The fact is that they are not here. They are not wanted here. The people have made that quite clear. I do not think there is any hope of their being here in the next 30 years unless they mend their ways very considerably and, perhaps, take a little bit of advice.
On what basis does the Minister claim that the people have decided that he should be in government.
That is not a point of order, that is an interruption.
Of course, the people have decided——
With 45 per cent of the votes?
Of course, the people have decided that we should be in government. Do not worry about that. If we have 45 per cent of the votes, have Fine Gael more?
I can easily answer that.
Order.
You tried that before; it does not work.
What about Longford-Westmeath?
You had to get a breather some time, otherwise you would disappear. However, despite the interruptions, I still want to continue. Deputy Donegan's speech was a typical Fine Gael speech, wailing and moaning about what we are doing and are not doing, how we are not going far enough in the Budget, wailing about old age pensions and the less well-off people in the country. It ignored the record of Fianna Fáil in so far as social welfare is concerned. Our party were the initiators of social welfare schemes against the vociferous opposition of Fine Gael and their parent, Cumann na nGaedheal. When Fianna Fáil came into power we only had an old age pension scheme—that was the sum total of our social welfare services. In those years it had been 10s, which sum was reduced to 9s. We started from that point and everything we have today for the less well-off sections of the community by way of social welfare and services has been put there by Fianna Fáil against the opposition of Fine Gael——
You do not mention free beef.
That is your heritage and I suppose it is hard to live it down. They say that the leopard never changes his spots and this is probably only too true. Despite the fact that the party changed its name from Cumann na nGaedheal to Fine Gael, it does not seem to have made much difference to the nature of the animal. During the years we have had evidence of this party who are for everybody when they are in Opposition but whenever they had an opportunity of doing anything for the people they either failed to do it or went a long way towards wrecking the economy by doing it the wrong way.
We have had this hoary old chestnut from Deputy Donegan, which he has mentioned before, that the Taoiseach should reprimand his Ministers. Fine Gael have this story one day and the next day they say the people in Fianna Fáil have no minds of their own, that they are all yes-men. When it appears that we in Fianna Fáil have minds of our own, the cry goes up from this self-righteous party that the Taoiseach is not doing his job because he is not reprimanding his Ministers, is not silencing them and putting them into the wilderness. Fine Gael want us on some days to be other than yes-men and then if somebody in Fianna Fáil says something with a slightly different intonation—and I repeat "intonation"—Fine Gael promptly say he is speaking out of turn, the Taoiseach must do something about this, Fianna Fáil will be ruined. Naturally, Fine Gael are worried about this——
What about collective responsibility?
Of course, we have collective responsibility?
Deputy L'Estrange spoke about corrective responsibility.
Of course, we have collective responsibility. This collective responsibility the Deputy talks about is not to be confused with the caucus groups that form themselves in Fine Gael and have their own little leaders emerging every so many months at different points of the compass to the great disappointment and, I am sure, embarrassment of a decent man who has the misfortune to be in the position of trying to lead the rarest bunch that has ever been collected together in a political party. These are the people who talk and point their finger and say to the Taoiseach "You should whip your Ministers into line." If we are not doing things as we should be, if the Taoiseach is not doing his job, and if I and the other Ministers are not fulfilling our tasks, then Fine Gael would have a hope of reaping benefit from it by transferring us from this side of the House to their side. However, in all the years of Fianna Fáil dominance in this country Fine Gael have not been able to transfer us from this side of the House. If Fianna Fáil are as bad as Fine Gael claim, how desperately bad must be the state of Fine Gael since they cannot replace us. If we are as bad as Fine Gael say we are, then that party must be in a very bad way.
The Minister was trying to replace the Taoiseach.
Order.
We have got a leader——
The Minister was trying to oust him at the Fianna Fáil Ard Fheis.
When we talk about having a leader we mean a leader. We do not go around sniffling and condemning, as I have heard some of the Deputies opposite condemn their own leader not so very long ago, openly and publicly.
The Minister tried to get rid of his own leader.
I have listened to the denigration of the leader of Fine Gael by his own Deputies, some of whom are in this House at this moment.
The Minister should name them.
I can name them.
Then, do so.
I will name them if I am pushed.
We are pushing you.
The record of the Fine Gael party is such that I am almost moved to compassion not to name the man and to add further to the burdens of an already broken down party that is trying to appear responsible by criticising those who are doing a better job and to whose places here they would aspire except that they know they have not a chance, not this side of the year 2000.
The Minister walked out of a Cabinet meeting. He promised the farmers £14 million——
Deputy L'Estrange must cease interrupting.
What the Minister has been speaking about for the last hour has nothing to do with the Budget. I have been listening to him on the inter-com and his speech had nothing to do with the Budget.
Will the Deputy listen carefully now?
If the Deputy leaves the House for his own peace of mind when I am here, perhaps he would be far happier if he did not listen on the inter-com and had his tea in peace——
The Minister walked out of a Cabinet meeting two weeks ago.
Does the Deputy expect that I would come out in a wheelchair because, if so, that is something you will never find me doing.
The Minister left that Cabinet meeting——
To put the record straight, I came out of that meeting in the same manner as I have come from every meeting in the 13 years that I have been a member of the Government. We came out as we went in, a united Government with our leader, Deputy Jack Lynch, still our leader and no question about it.
The Minister tried to oust him at the Fianna Fáil Ard Fheis.
Deputy L'Estrange should control himself.
"This is the time and this is the place; put up or shut up."
I have asked Deputy Harte to obey the Chair's ruling but he has refused to do so. I would ask Deputy Harte to leave the House.
It will be a pleasure.
It is mutual.
Deputy Harte withdrew.
This is a most unfair ruling.
There is no question of criticising the Chair's ruling. I warned the Deputy on three occasions——
The Minister has been making provocative speeches, not about the Budget.
If the Deputy is not careful he will walk too.
I do not mind.
I shall have to leave also. I cannot see any sense in that ruling.
Sir Anthony Esmonde withdrew.
This is Parliament, not the crossroads.
The Chair should have called the Minister to order. He is making a most provocative speech that has nothing to do with the Budget, as the Chair well knows.
If Deputy L'Estrange had gone and enjoyed his tea then the House would have been more decorous and he would have avoided getting his colleague the grand order of the boot. If the Deputy from Westmeath feels provocative statements are being made in the House, I should like him to realise——
Notice taken that 20 Members were not present; House counted, and 20 Members being present,
The Minister for Agriculture and Fisheries.
Before the Minister resumes could we have it recorded that there is not one member of the Fine Gael Party in the benches even though they have called for a quorum?
We have left under protest at a very unfair and biased ruling of the Ceann Comhairle.
Deputies
Withdraw that.
I would ask the Ceann Comhairle to take particular note of the last remark of the Deputy who has now again left the House, and who should not be allowed with impunity to make such assertions and allegations against the Chair.
They are quite true.
The Deputy should not interrupt from behind the barrier.
As I was saying, if my remarks have been provocative, which is apparently what Deputy L'Estrange has been complaining about, and if they are not related directly to the Budget it is because I was replying to the crassly stupid statements made by his front bench colleague a moment ago, Deputy Donegan. Deputy Donegan was complaining that Fianna Fáil were not doing enough, were not doing it quickly or well enough and that Fine Gael would do it much better. What is wrong with Fine Gael is that they are totally disappointed with the Budget turning out to be so popular throughout the country, doing so much for so many people and at the same time providing the wherewithal to pay for these things we propose to do during the year. These are the things that are being criticised. This is what rankles with Fine Gael, with Deputy L'Estrange and others, what has provoked them to misbehaving themselves to such a degree that one of them had to be sent packing, and in my humble opinion the man who has created the greater amount of trouble in the House has not yet been sent packing. However, perhaps that is the sort of publicity that Deputy L'Estrange is seeking here this evening, and perhaps in your wisdom you feel, Sir, he should not be permitted that additional publicity for rushing down from above, where he has been listening to what is happening on the inter-com, and making trouble. This seems to be his sole role in life, his sole purpose in the Fine Gael Party, to make as much trouble as he can in order to disrupt the business of the House and obstruct it to the greatest possible degree.
Coming back to his colleague of the front bench talking about the united Fine Gael Party, we know they have several leaders; in any room you go into they have a leader. Deputy Donegan spoke here about how they were being unfairly criticised, that they are being sinned against when the suggestion is made that they voted against the provision of the money in the Financial Resolutions here only a week ago, when we say they voted against the provision of the additional money required for the old age pensioners, for the social welfare classes, for the additional health service charges, for the increases to farmers.
That is their role on the occasion of every Budget, as the record will show. They will talk platitudes about our not going far enough in giving this, that or the other but, when it comes to the Financial Resolutions to implement the proposals they vote against them, and then come squealing, as Deputy Donegan has done, that they are being unfairly criticised.
Whom do they think they are codding? Is it themselves or the public or is it the Fianna Fáil people over here? What purpose does it serve to try to put this myth across again that they are for everything we have provided but they are against the provision of the wherewithal to pay for it and that they should not be criticised and exposed for the hypocritical humbugs they have shown themselves to be in that lobby only a week ago? Is the evidence not there in the record, not only this year but every year, that this is Fine Gael's role? Do more for everybody but do not provide the wherewithal to pay for them. We had the experience of that during the disastrous Coalition years and we do not want any more of it. Fianna Fáil and the Minister for Finance have been dealing prudently with the country's finances particularly in this Budget. As I have already said, not only are they providing for that amount which will be spent additionally but they have even gone to the point of providing the £10 million odd which will be required during the year for the payment of the public service and we are even criticised for that.
This is taking figures out of a hat, figures which have no substance and we are merely acting as humbugs as they would do if they were here. They are so imbued with humbug and codding the people that they cannot believe that it is possible for a Government, in a year after an election, and with four years ahead of them, not to be up to something sinister. This is the content of Fine Gael and all we can do is pity them or laugh at them. It is sad to see that this is the only contribution that that decrepit and broken down outfit of Fine Gael has to contribute as an Opposition. It is a poor substitute for an Opposition. It is the only role they have to play and they know that yet they would not even attempt to act in a positive and constructive way. If they did this, perhaps, they might—in some fairy tale way—have some hope but there is no hope for them acting as they have traditionally done, with obstruction, mud-slinging and seeking spies under the bed. This is Fine Gael's role but rather than condemn them we should be charitable and forgive them for their sins.
Then we have this further peddling of an untruth, of the scare that the increase of 2½ per cent in turnover tax is going to make a difference of 15 per cent in the cost of living. This is surely a juggling of figures to create a scare. If it was for some good purpose one might forgive them but it is solely for the purpose of creating unrest and trying to make the workers dissatisfied even before the impact of the 2½ per cent is felt. Fine Gael are solemnly saying that there will be a 15 per cent increase as a direct result of the additional 2½ per cent. How misleading can one be? It is really scraping the bottom of the barrel when we hear Deputy Donegan talking in these terms on top of all the other misleading statements which he and his colleagues have been making not only here but outside in recent weeks. We can, perhaps, leave these people quietly to lick the political sores inflicted on them by this very sound financial Budget, this very sound financial exercise by the Minister for Finance and the Fianna Fáil Government.
The Budget is popular because the people recognise its total implications in regard to the spreading of its benefits and in relation to the method of collecting additional money. They realise it is a good, sound and solid Budget which is giving more to those who need it and redistributing the wealth of the country, taking more from those who have money to give and giving it back to those who have not got sufficient for their everyday needs. This is Fianna Fáil's outlook and it always has been and I hope it will always continue to be. No diversionary tactics by the Opposition will ever put us off this way of thinking, this social conscience which our party has, to look after the less well-off by the redistribution of the wealth which incidentally continues to grow due to the activities of Fianna Fáil in regard to agricultural and industrial policy. Production is going up steadily year by year and it has only been by these methods of increasing production that it has been possible each year since 1957 to put additional millions aside for those who are less well-off than the majority. This has been made possible by greater earnings, greater production and bigger wage packets and an increase in the volume of exports. All of this has been due to Fianna Fáil's comprehensive policy and we are not going to be diverted by any tactics of the people in the benches opposite.
In regard to this question of social welfare we could, perhaps, take a look at ourselves in somewhat greater depth. On many occasions we have been criticised by others who have said "Your social welfare services are not nearly as good as those in Britain". How many people realise that our retirement pensions have reached and in some cases have exceeded the basic retirement pensions under the British social welfare code? How many realise that there is the distinction that here the worker stamps his cards over the years and at the end of his job life there is no means test? If he retires he can continue to do what he likes with his savings but on the other side, about which we hear so much, there is a means test. There must be true retirement of the subject before the pension is paid. If that is not tantamount to a means test then, perhaps, the Fine Gael financial wizards will tell us about it later on.
There are a few other facts which are well worth consideration here and if we think about them we can all, no matter on which side of the House we are, refute some of the allegations about how badly we do here compared with across the water. Let us ask ourselves if there is a similarity between our input into social welfare by way of contributions and over there. Taking the highest contribution we find that the contribution is 28s 3d but what is it on the other side? It is £4 3s and if we are to make comparisons between what emerges in the way of benefits from our social welfare services then we must also, for a true comparison, consider what amount is being put in. Those are the comparisons you have to consider when you hear people talking glibly about our not keeping pace with them over there. We are catching up and catching up rapidly with them; we have caught up with them in certain directions and I have no doubt that given Fianna Fáil guidance and the leadership which has brought us so far we will be right up with them in a very short time. Remember that our contribution is 28s 3d while their comparative contribution is 83s 7d.
This might be worthy of consideration on all sides of the House. It might also be worthwhile to follow the matter a little bit and find out what are the various other cost benefit analyses—I think that would be the proper term to be applied to this. It might be a worthwhile exercise for Fine Gael if they devoted their energies to this sort of thing instead of looking for scare stories, making allegations about the sinister Budget which has been produced, seeking to find out why there was a sinister Budget and if there is going to be an election which they cannot foresee. They do not know what is going on at present. There is a little homework there for them to do which will be a good mental exercise for them to engage in. It will be an education for them to see how far we have come and how rapidly we have been coming with our social welfare code from a very lowly, bad start obstructed by the people who went before them —the old Cumann na nGaedheal Party—when we were trying to establish, in the thirties, the very base on which our entire social welfare code now rests so securely and is taken for granted, as it should be, by the population today.
We should also take not of the fact that agriculture, about which, strangely enough, one does not hear these days as much as we were prone to hear over the last couple of years—agriculture, to the great disappointment, I think, of Fine Gael, in its political mind at any rate, has been doing pretty well; its performance has been pretty good. Perhaps a little breakdown as to how it has been performing and why it has been performing might be very useful to the same Fine Gael people who are so brain-washed by their own vivid scare stories that they do not see the wood for the trees, do not see the reality as against their own phony stories that they keep putting about in an effort to bolster up their courage so as to believe that if they live long enough, perhaps, they will get over here and become the government.
The situation is, very simply, that over the years, from a very early time in its history Fianna Fáil started to build up the agricultural element of our country in the full realisation that agriculture—to a greater extent then even than now—was the main element and the main base on which all other advancement might and would have to be built. Over those years as the money became available from those who were capable of providing it through direct and indirect taxation Fianna Fáil has been trying by various means and devices to provide the encouragement, the incentive and the confidence in the people on the land to use it to greater advantage than had been the case in the days of the old Cumann na nGaedheal regime which one can never really forget although, thanks be to God, we are far removed from it in 1970. Through the years, consistently, while we have been keeping the entire national front moving forward, agriculture has had its due place in the plans, the programmes, the expenditure, the schemes and the encouragement provided by successive Fianna Fáil Governments. So it is that right into the decade that has just gone Fianna Fáil more and more as times demanded and as circumstances allowed, continued to put more into this vital industry in an effort to make it a better industry for those engaged in it and for the well-being of the economy because it is such a vital exporter factor in so far as our national well-being and the welfare of the economy are concerned.
Let us consider the returns after those years. We find, for instance, that in our programmes over the years we have been providing money at various levels. We find, for instance, gross output from our farms in the year 1960 was calculated to be £193.1 million and by 1969 this had risen to £316.9 million. I should add that the latter figure is an estimate and has yet to be finally confirmed but it is near as makes no difference to what the ultimate figure will be. The increase in gross output over those years of the decade just gone amounts to 64 per cent. This is no mean achievement. Lest it might be said that it all took place in the early years of the 1960s let me say that I do not think this is borne out by the fact that the gross output in 1966 was £248.9 million compared with the £316.9 million that I have mentioned for 1969, showing over those three years an improvement of 24 per cent in actual gross output.
This, again, averaged out at 8 per cent, is a fair indication of the manner in which we have steadily gone over those years because 64 per cent over nine years and 24 per cent over three years shows a fairly steady 8 or 9 per cent—give or take 1 per cent—one year with another.
We have heard a great deal about farm income, and rightly so, in these more recent years. In 1960 farm income was £111.8 million and it had risen by 1969 to £173 million—again an estimate subject to final accounting but, nevertheless, showing an actual rise in the period of 55 per cent in actual farm income over the nine years 1960-1969.
Before Fine Gael get off on some sort of tack that they are liable to adopt in this respect and say that the increase is not nearly as much as has taken place in other sectors, let me record the regrettable fact, an internationally known dilemma today, that this is now being spread over a lesser number of people on the land than was the case in 1960. So, in so far as individual farm income is concerned, it does not have a direct relationship and, in fact, shows a much higher percentage as between the income for the individual farm in 1960 as against 1969.
These are facts and figures that no amount of argument by the Fine Gael people will controvert. I mention them for their edification so that when they come down out of the clouds and read some of them in future they will see in cold print these irrefutable facts which it would be well for them to digest before disgorging themselves of all sorts of criticism such as we have heard from them since the debate on the Budget opened. I would also suggest to them that they should look at the following figures in regard to agricultural exports and the value of our exports. In 1960, we exported £82.2 million. In 1969, we exported £162.9 million. This represents an increase in 1969 over 1960 of 98 per cent odd. This, in any context, is a pretty good performance for this industry that is so much decried as a dying industry and which it is alleged that Fianna Fáil have been neglecting. There have been suggestions even that we are crushing it out of existence. It is a very lively animal at this time and has shown remarkable growth on all those fronts in those nine years that I have cited for the benefit of the rabid opposition in Fine Gael who will not see except when they are made to see just how well we are doing despite the worst premonitions, imaginings and nightmares which they try to get across to frighten the public into not voting for Fianna Fáil, as they tried at the last election. Of course, they are even now beginning to build up those fears for the next election, for 1974.
That is only part of the story. We look, then, at our cattle population. We hear a great deal today about cattle. We heard Deputy Donegan, in all his wisdom, asking what was the use of the increase in the beef subsidy, what was the point in having it at all, that it was merely transference of losses on dairy products—in other words, that you are going to lose it over there in any case, so put it over here in the hope that in that way you will pull some of us out of milk, as he said, having built up over 30 years a high yielding herd. It would seem to be implied that he has got out of milk since then. All I can say is that if he jumped out that quickly, he jumped too quickly because if his herd was that long abuilding and was as good as he implied, he would be making very good money and better money in it than out of it at this time and Deputy Donegan knows this just as well as I do. I rather wonder whether he made a slip in his delivery here or whether, in fact, he was deliberately trying to cod me or the House or somebody outside for the political advantage of his waning and dying party.
We have the figures and they are that in 1960 our total cattle population was 4,684,000 in round figures and that in 1969 there were 5,688,000 cattle of all ages in the country. This showed the very substantial increase of 21 per cent during the years 1960 to 1969. Those who fully understand, as do many Members of the House, will realise how long a haul it is to bring about this sort of an increase. While we might be anxious to have gone further in even a shorter time, we have done well to have accomplished this increase of more than a million cattle in that time. Of course, this is not unconnected with Fianna Fáil policy but has been brought about as a result of Fianna Fáil's care and nurturing of the cattle industry during the years. However, more about that later. The increase in cattle output is the pay-off, if you like, for all that we have hoped for and all we have gained by the increased numbers between 1960 and 1969. The figures will show that the value of cattle output in 1960 was £56.4 million and in 1969 this figure had risen to £104.1 million, indicating an increase during those nine years of 85 per cent. Again, this has been a very solid performance and is an indication of the wisdom of the care that Fianna Fáil exercised in relation to the cattle industry during the past decade.
I turn now to the question of creamery milk. When we ask ourselves how that industry has fared during the same period, we find that in 1960 the intake of milk at our creameries was 281 million gallons while in 1969 it has risen to the figure of 526 million gallons, an increase between the years 1960 and 1969 of 87 per cent. Not a bad performance for an industry about which we have heard so much crying from the Fine Gael benches. In fact, those people in Fine Gael almost dripped butter and skim milk powder here during the past couple of years in their anxiety and worry about the creamery milk suppliers. The records will show, without confining ourselves to the past two or three years, that there has been the increase I have mentioned during the past ten years.
Just as the heifer scheme was wisely introduced in 1964 and added immensely to our cattle numbers, so also has the very solid financial support given to agriculture during these years helped the creamery milk industry so that last year it amounted to £31 million. This has brought about the increase of 87 per cent in milk intake between the years 1960 and 1969.
Pig output is a matter about which two years ago every Member of this Government was blackguarded by the great farmers on the Fine Gael benches who claim to know everything but who do not seem to be able to get that across to the public. Deputy Richie Ryan has described this public as "a stupid electorate" because they did not return Fine Gael's man in a by-election in Dublin some months ago. This electorate have left Fine Gael languishing in opposition, the same Fine Gael Party who strike like vipers, who try to create trouble and who try to obstruct the Government in their job of building up this country and its economy. They wept about the decline in the number of pigs. Of course, they blamed Fianna Fáil for the downward trend, but there is no word from them now during this debate pointing out that in the past year pig numbers have exceeded all records of the past in so far as throughput into the factories is concerned.
I can only say to the departing Deputies of Fine Gael that there is no need for them to torture themselves by listening to what Deputy L'Estrange describes as provocative talk from this side of the House because they can read all about it when the Official Report is published in a few days time. Of course, we will not then be able to judge from their expression just how deeply these figures hurt, despite their prophecies of doom. Just as they said two years ago that Fianna Fáil were responsible for the downward trend in the pig industry, will they now stand up and be manly enough to say that we are now responsible for bringing the industry up again and stop snivelling and saying that we had nothing to do with this upward trend—that it came about in spite of us?
The performance of the past year in relation to this industry matches the best performance in any year in our history since records were first kept and I hope this trend continues. I believe it can continue and it can benefit even further the producers, the fatteners and all others connected with the industry as well as benefiting the economy of the country as a whole. Between the years 1960 and 1969 pig output has increased tremendously in value. In 1960 the output value in millions was £21.7 while in 1969 the figure has risen to £38 million. I have no doubt but that it will be more than the £40 million mark this year because this industry is still on the upward trend. Evidently, the pig producers have not taken the advice that was given to them by Fine Gael, both inside this House and outside, when they told them that there was no place for them, that they should get out of pig production. The producers were told by Fine Gael that too much was being charged for fattening while too little was being paid for pork.
Let Fine Gael now admit that they were wrong in blaming Fianna Fáil two years ago. Will they not now admit that Fianna Fáil are entitled to the credit for the upswing in pig production, throughput and output that I have indicated very briefly this evening? Let these people know that this upward trend has come about by our aiding, encouraging and inducing pig producers to stay in the business and by our inducing them by grants to invest in fattening houses, whether this investment be on a co-operative or other basis, to ensure that when they produced pigs they would not be left without a market through the lack of fattening space. It is my belief that it is the lack of fattening space that has been responsible for the upward and downward trends that have been puzzling many people in Europe for many years and not just in this country alone.
Let us say then to those people in that industry that they have been doing a good job in reviving the industry to the degree to which they have revived it. They have now broken the 2,000,000 barrier and it is straight ahead in so far as their further production in the coming years is concerned. We, in Fianna Fáil, will be as concerned about them in the future as we have proved ourselves to be in the past and we will help them along every step of the way to make the industry bigger and better, more profitable for those engaged in it and, ultimately, on the export market an earner for us abroad.
Let us look also at the total contribution and calculate what has been the total contribution in terms of cash. Remember, cash returns to our farmers are what they can count and it is what they can count that really matters in the last analysis in any endeavour of a commercial nature whether it be farming, business or what-you-will. What have we contributed, taking one year with another?
Not £14 million anyway.
In 1960-61 we injected into agriculture of all descriptions a sum of £19.9 million. By the year 1969-70 that figure has risen to £90.5 million which figure will probably come to be corrected upwards when the final accounts are adjusted, as they will be very shortly. This action is an indication in a real sense and, if people do not appreciate the other reasons I have given and the schemes I have mentioned, I think they must be appreciative of these figures showing the millions the Government have directed into agriculture over the years. The increase from £19.9 million to £90.5 million represents an increase of 355 per cent. That is an increase any Government can be proud of and I am particularly proud of the performance of the Government in that regard.
Let me deal now with the Opposition, particularly the absent Opposition. There is an Opposition on my left but I am sure the Labour Party will excuse me, apart from a few complimentary asides I would have made about them, if I deal for a moment with the invisible Opposition who need this sort of education more than the Labour Party does because they are misled and they must be corrected; if they are not corrected they will only do damage to the country by advising wrongly. Deputy Donegan, for example, says he has gone out of cows having spent 35 years building up a herd. Deputy Donegan will do damage to himself. Come the next election, the invisible Opposition will be back on their farms and not in their seats here. They are only birds of passage. That is why they squawk so much when they come in here to rest for a little while. They do not mind how they foul the place up because they know they do not have to sit too long in it.
I advise Deputies of the Fine Gael Party to realise, appreciate, digest, absorb and consider and, having done so, keep silent for about six months. Then they can come back and tell us what they think. If they do that I believe the Fine Gael Party image will improve immensely and their performance in this House will equally improve. Parliament will work better if they do just that.
There are a few other matters I should like to put on record. So far as the overall development of agriculture is concerned we have been making appreciably greater advances and growth than we are generally credited with; I am not now looking for any bouquets but, from the point of view of the confidence that our people on the land are entitled to have in themselves, they are, I think, entitled to know the facts and to appreciate them. They should not allow themselves to be diverted from an appreciation of the facts by any imaginative exercises indulged in by the Fine Gael Party. Confidence in themselves is a vital ingredient for those working on the land. The records created and the achievements over the years are theirs. Any part we have played in them we have played as a responsible Government. They should appreciate that they have achieved these things and they should not listen to the weeping willies who tell them they are sunk and that there is no future for them, whereas, if they only stop to think, they must realise that year after year, and no year better than this year, they are better off than they ever were before. There is now confidence abroad. Why should there not be? That is the way it should be and it is detestable that that group over there should keep pumping into them that there is no future for them. If it is not the Government it is the EEC; if it is not the EEC it is the Anglo-Irish Free Trade Area Agreement; if it is not these things it is the man above—bad weather will come and wreck everything no matter how well things are arranged by all these other agencies. Fine Gael prophesy doom. This will not do anybody any good. I want the farming community to look askance at anything that emerges from Fine Gael because it is not intended to do any good to those who work on the land or to agriculture in the future.
We had a target of 1.7 million cows. In 1964 we brought in the heifer scheme, a scheme that was much criticised. The criticism has now died down and, despite all the scrub cows that were denigrated by all sorts of people, we cannot get away from the fact that that scheme did a great job in bringing the number of cows up from 1.4 million to 1.665 million. In other words, we are within kicking distance of the 1.7 million we set out as the target away back in 1964. This is good shooting when you consider all the difficulties and the length of time it takes to build up from what had been regarded over the years as a sort of traditional number of cows. It was a kind of barrier; 1¼ million was regarded as the norm. We are now moving right into the 1.7 million and I want to pay tribute to those who introduced the scheme, Deputy Paddy Smith and the present Minister for Finance who were both Ministers for Agriculture. The scheme was blackguarded as being no good, a waste of money with the money going to all the wrong people. The fact is that the cows are there now and Fine Gael and the other critics can talk to their heart's content. The cows are there. They are producing calves. Out of them we are getting beef and still more calves. That is what counts where the farmers are concerned and not the hollow talk and the specious arguments and predictions of the Fine Gael Party.
We have, too, the extraordinary situation of being almost dead on the button so far as milk production for 1970 is concerned. Away back years ago milk production was down to 337 million gallons. That was in 1963. We set our sights at 550 million gallons by the year 1970. Despite all the abuse, despite all the alleged rows and non-rows, the fact is that last year, in 1969, we were within 34 million gallons of the target we had set for 1970. Again, I say very, very good shooting in a matter as complex and difficult to project as milk output and input.
It cost a little, did it not?
If by means of money we could get milk from stones there would be no need for us to worry. We could dispose of the 1.7 million cows. We could get calves somewhere else and milk the rocks of the country by putting in a coin and getting a cup of milk—is not this really what it is?
Notice taken that 20 Members were not present, House counted and 20 Members being present.
As I was saying, we could not get milk from rocks even if we had all the gold in the world. So, the answer to Deputy O'Donovan's question, interjection or interruption—I do not mind which; I know he was trying to be helpful—is that if you have no cows you cannot have milk regardless of what you are prepared to pay. In fact, we have practically reached our target after all those years in the complex matter of milk production, moving up from 337 million gallons to 520 million gallons last year and with every expectation that we shall reach about 550 million gallons this year, given a reasonable milk season. If it is a very good season we can be over, if very bad, we can be under but we are as near as makes no difference. To those who projected the figure originally and guided production to the present point since then, I say this was very good projection and very accurate shooting from 1964.
Pig output in 1969 is now estimated at 2,060,000 and that has exceeded our target for 1970 by the odd 60,000. The output in 1963, before this projection was made, was 1.7 million pigs. With whatever aids we got from whatever sources we have exceeded the 1970 target in 1969. Again, this was extremely accurate projection which can give us confidence for future projections. This is important to realise.
Barley output in 1969 was 570,000 tons compared with 414,000 tons in 1963. The target for 1970 was 600,000 tons so that in 1969 we were within 30,000 tons of what was projected over six years ago as the target for 1970. Here also we have scored, if not a bull an inner. It is close shooting by any standards when one considers the difficulties to which it was subject not the least being climatic conditions. We need only an additional 30,000 tons to be dead on target this year.
These are things the House is entitled to know and have on record so that Deputies may be aware of the really solid, steady, planned progress that agriculture has been making. This is no accident; it was planned and the targets were set as long ago as seven years. On all major fronts of agricultural activity and output we are approaching those targets very closely so that we can congratulate those who predicted so accurately what the output would be. This is something of which we should be aware and which our farming community should fully appreciate. They are being helped by a Government and a Department of Agriculture assisted by other Departments involved in these exercises to project and plan for the future and to hit the targets with such remarkable accuracy as we are now doing.
In the coming year the projected income increase for the farming community will be of the order of over £10 million. Distributed over the family farm income this gives an increase in this year's earnings for the farmers of approximately 8 per cent which is just ahead of the figure called for by the Taoiseach and the Government in recent months. In arriving at that £10 million, full consideration was given to the various claims made by the farming community and transmitted to the Government by me. All the furore about the Minister for Agriculture and Fisheries making demands for this figure or that figure is just about as well-informed as are suggestions by Deputy L'Estrange that on the day on which we came to consider this matter I walked out of the meeting. As I asked him, did he expect me to come out in a wheel chair? I walked out, as I do every day. I should have added that I came out arm-in-arm with the Minister for Finance who very kindly gave me lunch, I think, that day. It was not in order to dry up my tears because we are, and have been friends, not only in the Government but outside it.
Deputy L'Estrange and others like him who would like to make trouble over here are only codding themselves and wasting time. The Deputy should devote his energies elsewhere where he can find these splits and cracks and fissures in which he can interfere, perhaps, with some success: he will not find them over here between any Ministers in the Government or between any Minister and the Leader of the Party and Taoiseach, Deputy Jack Lynch. This seems to be an obsession in Fine Gael at present. Having no settled leader themselves they think we have none either. They would like to make it appear that way. I think it is envy over there that generates these wild charges of disruption in our front bench, or in our party, and splits between Ministers and between Ministers and the Taoiseach.
For their discomfort I can assure them this is totally and absolutely untrue and that we are, as we have always been, a united party and Government that will do what is right when it is right regardless of the political consequences so long as it is in the interests of the country we are all privileged to serve.
I can tell the House that we got consideration for agriculture in relation to the entire situation. We got from the Exchequer this year an additional sum for agriculture of approximately £5 million, and it will be nearer £7 million in the next full financial year. It is £5 million for now and is included in and goes to make up the £10 million I have mentioned, bringing about an increase in family farm income of approximately 8 per cent. This has been the sheer consistent Fianna Fáil policy. The Government have provided this additional £5 million out of the Budget to bring about, with additional increased income from farming, a figure that is just above the norm of 7 per cent which it has been decreed and calculated is the figure which our economy can stand during the coming year without doing damage.
All one can say is that it is a pity that the other elements in our community would not be guided by some thought in the direction of the goose that is laying the golden egg. Remember, our goose has been laying pretty golden eggs in recent years. We are doing extremely well. It would be a pity if by over-anxiety, by over-pressure, by over-enthusiasm, any large section got so much in any one year that it upset the balance of the economy. This would be to the ultimate detriment of the entire community.
Do the farming organisations share the Minister's optimism?
I am not talking for the farming organisations. I am talking for myself, my Government and my Party, when I say that we have provided in the Budget, together with the natural increased outturn from farming, a family farm income increase of about £10 million which, distributed individually, will mean an 8 per cent increase approximately. This is 1 per cent above the figure that has been called for by the dictation of the trends that have been read over the years as being the right norm at which our increases should take place.
As I say, I only hope that during the year others who have not perhaps the restraining influences or, indeed, the stability that the farming community has, will not unbalance our economy to a degree that will not only kick back on the farming community but also on those very people who try to get—and who can blame them?— and succeed in getting perhaps a little more than our economy can sustain at this time.
We are going ahead. Let us continue in that way. Let us not have too much rocking of the boat in the manner that is being sponsored by the "boyos" over there who are not there tonight. Let us have less of that and a little more constructive criticism from over there and a few more suggestions of some worth. I am sure they are capable of contributing if they will only get down to it. In this way I think that this year ahead between now and the next Budget will prove to be another good year of progress under Fianna Fáil.
As the statement of the Minister for Finance indicated, if further action to redress any imbalance is needed, we have a Government here capable of acting at the right time in the right way, and fearlessly so far as the economy of the country is concerned. Whatever may be the outcome this year—and we are hopeful that it will be good—the people can be aware that the Government are a united Government, a Government that know their job and are prepared to do it, and that we will act if action is needed, but we hope it will not be necessary in these coming months.
We should also keep in mind that this Government will be here bar some strange and extraordinary happening —and there could be one that comes to mind—but bar that——
An earthquake.
No, but the next thing to it. Bar that, there will be a Fianna Fáil Government here for the next Budget, the Budget after that and the Budget after that. Then we will have an election and we will be coming back for another four or five Budgets on the trot. All those in the opposition who feel they have anything to contribute—and there must be a few of them—should put their heads together and give a little help and a little encouragement to the Parliament of the people of this country to which they are elected.
For which Budget will the Minister be Taoiseach?
They should give some indication that they know they have a role to play and are prepared to play it, that of being the permanent Opposition until Deputy O'Leary—I do not know which party he belongs to——
The Labour Party.
Which of the Labour Parties? Until one or other of the Labour Parties displace the Fine Gael Party, they are permanently in opposition. Over there they belong, and over there we intend them to stay. The way to do that is by sound budgeting, good programming and planning for the future as we have been doing, prudent spending and the raising of the money for any and all additional expenditure, raising it properly and not trying to cod the people that we can give them more and charge them less, which has been the hallmark and the downfall of the Opposition parties over the years.
Having listened to the Minister for two hours——
Was he two hours?
I think so. Having listened to him for almost two hours once again telling the people of Ireland, and particularly the people in the rural parts of Ireland, that they "never had it so good", I am inclined to think that the Ministers will have to come down off their high horses and talk to the ordinary people to find out some of the real facts of life.
On Friday last my name was mentioned, amongst others in this party, on two or three occasions as being one of the people who voted against the increases in old age pensions, widows' and orphans' pensions and social welfare. Since I came into this House I have become more and more aware of the way anything that is done or said by people on this side of the House is misrepresented. When the Ceann Comhairle put that part of the Financial Resolution to the Dáil the motion simply referred to "an increase in turnover tax and other items of 2½ per cent". That is what I and other members of the Labour Party voted against. I voted against an increase in turnover tax of 2½ per cent and the Leader of the party, Deputy Corish, set out in very clear terms why the Labour Party intended to vote against it.
In case some members on the Government benches have forgotten it, this turnover tax was debated for a very long time in 1963, when it was first introduced. The arguments against it then are just as strong now. The arguments against increasing it now are even stronger. On that occasion the House was told that for several reasons this was a bad tax. It impinged as heavily on the necessaries of life as on luxuries.
It has been increased on necessities such as tea, sugar, butter, bread and milk to the same degree as on the luxuries which people can often do without. It is a tax on medicines for human consumption—not on medicines for animals. When Deputy Tully questioned him, the Taoiseach was not aware that there was a tax on medicines. A snap reply of his suggested that there was not such a tax but this was later found to be incorrect. A tax on these necessities of life was what I and other members of the Labour Party voted against. It affects ordinary items such as butter, for instance. Recently we have had a lot of talk about an increase in the price of butter as against substitutes. This, of course, means that butter is more expensive and out of the reach of the ordinary people because it is now raised to a prohibitive price of 5/- per lb.
The tax is bad because it is a tax upon a tax, one that is computed on the gross receipts of a business. In 1963 every retailer was made a tax collector; his job is doubled now. This year he has to collect for the Government twice as much as he did last year. In 1963 the turnover tax amounted to approximately £8 million. It would have brought in this year, had it not been increased by 2½ per cent, approximately £23 million. It is now estimated that for the period of the Budget the turnover tax will bring in £20 million. The Budget has imposed £20 million by way of turnover tax which will impinge much more severely on the poorer sections of the community than on any other section.
The tax puts in jeopardy the fate of a number of small shopkeepers throughout the country. It will affect those shopkeepers who are close to the large centres of population and who find that their way of life is put in jeopardy as more and more people find it cheaper to drive to the supermarkets in the large centres of population. This dilemma faces many small shopkeepers in County Wicklow whom I represent. I am sure the same position obtains in many other constituencies that border on a large town where foreign concerns have moved in and taken over the retail trade.
The Minister for Agriculture and Fisheries howled down the suggestion by a Fine Gael Deputy that this tax would impose an increase in general prices of 15 per cent. I do not know where the people in Fine Gael got their figures, but before the Budget was introduced statistics were issued by people in the Economic and Social Research Institute in their quarterly bulletin. They stated:
With regard to prices it appears inevitable that 1970 will see a further substantial rise in general domestic prices. Pay rises of the order being granted cannot be absorbed from profits and official price control cannot prevent widespread price increases. Even without any additional stimulus from higher rates of indirect taxation, an annual rise of between 5½ and 6 per cent in the consumer price index can be anticipated.
That was stated before the Budget and before anybody knew that additional taxation would be imposed by way of turnover tax. In common with many other speakers, and I think people on the opposite side would have to agree, I do not believe that a 2½ per cent increase would be the very minimum. People who are asked to do the Government's work by collecting taxes for them will add on the extra few coppers for themselves in order to compensate for the additional trouble imposed on them by having to collect this tax.
Will they overcharge then?
I am suggesting that the people will have to pay for the extra work their staffs must do. I know of one firm in my own town who employ two people to manage the turnover tax alone, to make up the returns and to send them in. These people must be paid and their employers have to find the money. I suggest that at the very least 3 per cent can be added, bringing the expected rise in the consumer price index this year to 9 or 10 per cent.
The people who have chided us for voting against this tax have themselves been careful not to suggest that they were adding to the burden of the poorer paid workers. When they blamed us for voting against increases in social welfare, they neglected to say that they themselves were adding further taxation to the cost of such necessary items as tea, sugar, butter and bread. In the public Press this week there is an application for an increase of 4d being sought by the millers for the loaf of bread. This is before the imposition of the turnover tax and if this is allowed by the Minister for Industry and Commerce we can expect this one item to increase by 4d plus a charge of 1d or 2d in respect of turnover tax. Therefore, on one of the most common items in a household there will be an increase of at least 6d on a loaf of bread.
It was strange that when the Taoiseach made the Financial Statement he criticised one section of the community more than any other for the suggestion that the economy might suffer from inflation in the coming months. He referred, without mentioning them, to the brutal exercise of bargaining power by strong organised groups. It was wrong to single out the trade union movement for special mention as being unfair to the rest of the community in their operations on behalf of their members. I am a trade union official—a branch secretary of the largest union in the country—and in the past few months I have been involved in several days of negotiation for the improvement of wages and conditions of workers in my own town and the area around it. I certainly make no apology to anyone for trying to get the best deal possible for these workers. Employers themselves are hard men to deal with, and anything that a trade union official gets is hard won. It is not given easily. It is often given grudgingly and as a result of protracted strikes.
Before Christmas the Taoiseach asked for a 7 per cent ceiling to be imposed on wage settlements. At that stage several demands had been made and processed throughout the country. Some of them had resulted in increases which, over the phased period for which most of them are granted, will result in an increase of about 20 to 25 per cent, some of them up to 30 per cent over their original position.
The reason for these huge increases is very simple. Over the last two years prices have risen for everybody by almost 20 per cent. When workers meet their trade union officials and ask for claims to be formulated on their behalf, they look at what has happened to their wages and are very vociferous in letting their officials know they want to be compensated for the reduced purchasing power of their wages. It is ridiculous to expect a worker earning £15 a week to limit his demand to 30s when it means imposing on himself a reduction in his salary of an additional 30s, because through the increase in everything he has to buy he finds his wages have lost 20 per cent of their purchasing power. The worker will also say: "If this was the trend for the last two years, what guarantee have I got for the period of the next agreement that prices will not go up by a similar amount?" The evidence contained here in the report of the Economic and Social Research Institute would lead one to believe that he must face an additional 10 per cent rise in prices.
With all the talk over the last few days about inflation and having regard to the directives of the Taoiseach before Christmas and of the Minister for Finance in this Budget that a 7 per cent increase should be adhered to for workers, it seems ridiculous that immediately this Government should impose price increases of at least 3 per cent on all commodities right across the board. The trade union movement has produced figures which show that, whereas ten years ago one worker out of every four paid income tax, at the present time three out of every four workers are paying income tax. Furthermore, the worker is paying not just one form of taxation but several, including a tax which he never paid before. Although there are welcome reliefs in the income tax code in the Budget, nevertheless whatever increases the workers receive over the next few months will put many of those who, it is suggested, should be free from income tax back into the tax net. Much of that increase of £2 10s to £3 which most workers are settling for at the present time will be taxed and, therefore, some of that increase will return to the Exchequer. As well as that it is fairly safe to assume that in the next few months they will have to pay an increase in the social welfare stamp.
This Government have been allowing outside agencies to do work that they themselves should have been doing in this Budget. The lack of any great urgency to see an end to the cement strike which has dragged on for 13 weeks and which has operated to the detriment not only of the unfortunate worker in Dundalk and Limerick but of the business people in those areas, has in itself been a form of pressure on the economy because it has brought the housing programme to a virtual standstill. The few bags of cement which are brought in over the Border by some of those people who always take the opportunity of making a few pounds out of a bad situation will in no way help to bring about any easement for the numbers of people engaged in the building industry and who have been laid off work in the last few weeks. The suggestion that the increase in the unemployment figure of almost 10,000 people is due completely to the cement strike shows the effect that strike is having on the whole country. I am sure that at the end of the year this strike will be given by certain people in the Government as the reason why many more houses were not built during the present year. There has been no great initiative until this weekend to have an end to this strike. This is one rather subtle way the Government have of trying to reduce the inflationary tendency that is showing in the economy.
The increase of £29 in income tax relief for married women, although it is small, is welcome. However, I should like to have seen more done for those young married women, newly weds, who find they must continue to go out to work. They must continue to work for a few years after they are married in order to make ends meet and to set up a home. I would like to have seen the Minister paying more attention to these people, giving young people a better incentive at the commencement of their married lives to set up home and to enable them to buy all that one has to buy in the first few years of married life. Unfortunately he has not done this but I hope that in some future Budget he will give these people some relief.
The Minister for Agriculture and Fisheries has been telling us that the farmers never had it so good. It is strange that the farmers, in order to maintain their present standards of living, considered that they required at least £20 million extra. Even if they had, as sometimes happens when one is bargaining for extra money, inflated the figure somewhat in the hope of upping the amount the Minister would give, they must indeed have been very disappointed with this Budget. Despite what the Minister said many of them feel that they have been treated despicably, used as a football in a power struggle between two Ministers. They looked for £20 million, they were promised £14 million and they got £5 million. Doubtless that section of the community must be very disappointed.
All of us on these benches welcome the increases given to social welfare recipients. If they had not been given, and given in the size in which they have been given, we would have been very vocal in looking for them for that section of the community. As I said earlier, the increase in the cost of living in the past two years and the expected increase in the next year make it all the more important that this section receives very generous attention. It is ridiculous always to be talking in terms of percentages. No matter what anybody says, whether £5 is increased by 20 per cent, 10 per cent or 5 per cent, it is not a very big amount of money on which to live for a week and to suggest percentage increases at that level is not much use to people in the social welfare group.
The contributory old age pension will be £5 from October. It is unfortunate that these people have to wait for this money until October. We are told that this is because changes are required in regard to the printing of books and in book-keeping and this time must be allowed. The man in the street, and indeed any one of us, must wonder how the book-keeping can be got over in regard to turnover tax which can be imposed right from the beginning of May but the social welfare recipients have to wait for six months for their increase and have to put up with additional taxation in the meantime.
Any increase in taxation of the type imposed in this Budget would have to be opposed by me and by the Labour Party generally; any increases in the cost of the necessaries of life, which weigh so heavily on the poorer sections, must also be opposed by us. The Minister has made up the amount he requires by just one additional tax, the turnover tax. As a responsible Minister he should have spread the load more evenly over the whole community, asking those who are better off to bear a heavier load than those who are less well off. It is for this reason that I and my colleagues have opposed the increase in turnover tax.
Deputy Moore and Deputy McLaughlin rose.
Deputy McLaughlin.
Sir, I have been here since 4 o'clock this evening. Twenty minutes ago there was not one Fine Gael Member present. They had all gone on strike. I am not questioning your ruling, a Leas-Cheann Comhairle, but I must protest against the carry-on of the Fine Gael Party this evening. They boycotted this House——
This is most disorderly and the Deputy knows that.
Now they have walked in and I must take my place again. It is most unfair.
It is most unfair to Deputies who were here all afternoon.
The Budget debate gives us an opportunity to give the Government information which otherwise they might not have. We live among the people and we know which schemes are being administered and we know of the many schemes that are not being administered and which would be a help to the community. While this Budget may read pretty well on paper people will know far more about it after some six to nine months because the Budget is increasing everything which people have to buy to run their homes or in the course of business. Every day they will discover the effect the turnover tax is having, the effect which the Minister meant it to have. This Budget is going to set prices soaring. Not alone will there be a 5 per cent increase but in many cases there will be a 10 per cent increase and no Department will be able to check on this. Wage demands will follow and there will be a repetition of the vicious cycle of wages chasing prices.
We welcome the social welfare increases and thank the Department for them but they certainly will not offset the hardships that will be imposed by other provisions of the Budget.
There is an increase in the beef subsidy and in the lamb subsidy but it must be borne in mind that the number who will benefit by the beef subsidy will be very small in comparison with the number that will derive no benefit from it. A farmer who has a well-established dairying business, who has a well-bred herd of dairy cows, a well-kept dairying concern, milking machines and other equipment, will be reluctant to change over to beef in order to avail of the grant of £21 for the first cow, £19 for the next and £16 for the remainder. Such a scheme will not attract many dairy farmers. It may attract the man who has a job or who is growing old and is unable to milk. Generally, the scheme will not be availed of to any great extent. While the grants are tempting they will not compensate for the eight or ten creamery cheques per year and, from my experience, the calves will be just as valuable to the farmer who would feed them in the farmyard as to the man who would have them suckled. In my opinion, the improved beef subsidy scheme will not be availed of to a large extent by dairy farmers. However, it will be welcomed by all those who do avail of it.
The Department of Local Government should take a good look at the question of housing. The housing problem is particularly noticeable when a house becomes vacant even in a town with a small population.
I should like to dwell on the subject of drainage. I come from Sligo-Leitrim and am familiar with the conditions that prevail throughout a wide area of the west. There is a scheme known as the arterial drainage scheme and a scheme known as the local improvements scheme.
The Deputy will appreciate that matters that fall for discussion on Estimates are not suitable for a Budget debate. A Budget debate is confined to the financial matters before the House. The Deputy may make a general reference to these things but detail should be reserved for Estimates.
On a point of order. May I refer to the speech of the Minister for Agriculture and Fisheries and the wide scope he was allowed?
Correction. The Deputy was not in the House at that stage and does not know what went on. You lost your heads then.
It was heard on the inter-com. It is very unfair to limit a Deputy and allow a Minister to go haywire.
If I were to talk about drainage in the west, would that be general or should I talk about drainage throughout the country?
Detail is reserved for Estimates. There is an Estimate on which that would be relevant. The Office of Public Works is responsible for drainage and on the Estimate for the Office of Public Works drainage is a subject which would fall for discussion.
I accept your ruling but when the Estimate comes up I shall have a lot to say on the subject of drainage.
Prior to the introduction of the Budget the Minister for Agriculture and Fisheries had a number of meetings with various groups connected with agriculture and with the Irish Country-women's Association. Over periods amounting to 70 hours the Minister for Agriculture and Fisheries discussed every facet of agriculture. He agreed that it would take about an extra £20 million to bring the farming community up to date and to meet their requirements, in view of present costs. The farming community were very happy that the Minister for Agriculture and Fisheries was going to do something that would heal many old sores. We all looked forward to Budget day when the farming community would get £20 million. We were disappointed. The most the Minister got was around £5½ million.
A far cry from £14 million.
Where would you say the other £15 million should come from?
Deputy McLaughlin is in possession. Other Deputies may contribute in due time.
It is a far cry from £20 million or £14 million to £5½ million. Five and a half million pounds for the farming community over the Twenty-six Counties is a very limited amount of money. We all know that prices are rising, that wages are increasing and that the management of even the most economic small holding has become a problem. This treatment of the farming community and of the townspeople in the west, in particular, is having a very serious effect. Let there be no doubt in anybody's mind. This treatment of these people is not a recent development; it has been a feature of Fianna Fáil administration over a number of years.
Railways have been closed down; homes have been abandoned; families have emigrated. That results in closure of schools. One reads in the press of disputes in regard to the closure of schools. In the last few years business houses have been closing, particularly in areas that have become depopulated as a result of the other closures I have mentioned. In my view there will be more business houses closing after this Budget because they will not be able to bear the increased turnover tax.
Garda barracks have been closed due to a decline in local populations. A decision is made in Dublin that the number of persons on the register would not warrant the maintenance of a Garda barracks. As a consequence there are squad cars travelling around the country and there is very little contact between the Garda and the people. Very often the result is that it is difficult to detect crime. One result of this sad picture is that parochial houses are closing down and when that happens the situation is very serious because by then practically everything has closed down with the exception of the church but if the decline in population continues there is a danger that some of our churches will have to be closed.
Some few years ago there was a circular from the Department of Local Government saying that quarries would have to be run as economically in one county as in another but to my mind that did not make any sense in so far as Leitrim was concerned because if we are to keep the people at home there must be some give and take. As a result of this flight from the land or from the town, as we might now say, many post offices are closing. This decline is the result of the non-provision of employment by the administration. When I first became a member of the county council I was made aware that many people were happy to work on their small farms from the beginning of the year until September or October when they could then get a few months work with the county council. These few months work would help to supplement their incomes and provide the farmer's wife with some cash. However, such employment is not now obtainable because of, among other reasons, the closing down of the county council quarries. The people have gone away. Perhaps we should not regard the picture in such a pessimistic manner but we must remember that many homes have been closed and once a home has been closed it is not easy to open it again.
While I am on the question of employment I should like to mention that in my constituency I am aware that forms have been handed to people with a request that the forms be filled in with information as to where persons are working and as to whether they are seeking employment. Some of these forms are being sent to people in England but when some people have come home in the belief that employment is readily available, they have found that this was not the case. This is a very serious matter and is one that should be looked into by those concerned.
As far as I can see there are many schemes that could be speeded up by the Department if there was more co-operation between them and their engineers. Some time ago an increase in salary was sought by engineers employed by local authorities to bring them into line with their counterparts in other concerns. The increase was agreed by the local authorities but authorisation was not obtained from the Department. I have every reason to believe that engineers are not pushing many schemes that might be pushed because of the fact that they have been treated in this way by the Department. Therefore, I would seriously request the Department to consider this matter in the near future. The engineers are a very important body within our community. Many schemes can be held up if there is not the proper co-operation with them. People have often had to wait for up to four months to get schemes under way only to be told then that certain materials cannot be obtained. It seems strange that the necessary materials cannot be obtained with less delay.
This Budget will militate more against the business people than against any other section of the community because it is they who must bear the full effects of it by virtue of the turnover and wholesale taxes. These people usually buy a large amount of goods or materials at a time. At the time of purchase they must pay wholesale tax and the goods or materials may be left lying on their hands for six months before being sold. The Government should consider these people.
If members of the Government had gone down to rural areas and saw what was happening I do not think that we would have the serious situation that we have now. We read recently that £15 million had been given towards an industry in Cork. During the referendum campaign the Minister told the people of Leitrim that if they did not do as he wished, the county would be divided into three different constituencies, one part going to Donegal, one to Sligo and one to Roscommon and that is what happened because of the people's refusal to do as he wished. That was unfair. Leitrim is the poorest county in Ireland. There cannot be any sincerity in all this talk about saving the west.
There is plenty of work there to be done. On the few occasions on which I have suggested some industries for parts of my constituency I have been told by the Department that if I could satisfy them that there was local effort and a local contribution forthcoming they would then seriously look into the matter. Asking counties like Sligo and Leitrim to put up money and to put proposals before the Department, proposals which would satisfy the Department, is certainly not the best approach if we are sincere about saving the west. The Department should send down inspectors and engineers to towns like Ballinamore, Drumshanbo, Manor-hamilton, Sligo and other centres of population to see how these towns lend themselves to some kind of industry which would keep the people at home. The people would be happy if they got some small industry employing even 20 in each town.
The Department should come to the rescue. What is happening is that taxation is going up every year. Rates are rising. The cost of living is going up and these people are left to linger on in this parlous state.
I wish to preface my remarks by joining with the other speakers today who wished the Minister well and a speedy return to this House. I have been here now for six years and I have heard six Budgets presented in this House. Every year the attitude of the Opposition has been the same, so much so that one tends to find the criticism boring. It begins to sound very insincere indeed. The attitude of the Opposition parties surprises many of us. It is all very well to say that one favours an increase in social welfare payments; it is hardly logical then to go and vote against the means of providing those increases. To say the least of it, this is hypocrisy.
Speakers today suggested means by which such money could be raised but not one came up with the full total of almost £20 million. It may be part of the function of an opposition to criticise. I suppose it depends on what one's attitude to a Budget should be. To my mind a Budget is yet another step towards a wider distribution of the national wealth. It would be easy for the Minister to balance the Budget without imposing additional taxation if he were simply doing a commercial exercise but running a country is not like running a business. A country is run for the benefit of those who live in it and it is the duty of Parliament to ensure that the wealth of the nation is equitably divided.
To my mind this Budget is an equitable Budget. While one will never have a perfect Budget, the Minister has, I think, set a very fine example and shown his continued care for the under-priviliged, the aged, the handicapped and the weaker sections of our community. Organised bodies can make their voices heard. They have an important part to play in helping the Government to guide our economy on the right lines. Those who are unorganised cannot make their voices heard. The present Minister, like his predecessors, has shown a continued concern for the old and the handicapped. I do not suggest for one moment that this Budget contains everything one would like to see in it. I do not accuse the Opposition of being heartless. There are men on those benches over there who are as concerned as we are about the aged and the handicapped but they lack a realistic approach to the whole problem. Wishful thinking and emotional thinking will not give an old age pensioner 1/- more. Neither will it increase the pension of the ex-garda, the ex-teacher or the ex-civil servant.
If we want to distribute the wealth of the country equitably we must, first of all, create the wealth. I believe the policies of the Government are doing just that. We will in time see—I do not like the word "affluent"—a better-off society in which all our children and all our aged will be cherished equally. To do that taxation must be raised and if Deputies come in here and take the cream but refuse to impose the necessary taxation they are not serving any purpose, be it their own or that of the democratic Government of this country.
Inflation was mentioned by practically every speaker. Inflation is a worldwide problem. It was said that the Minister should have been much more harsh in his impositions in this Budget. Three or four weeks ago, just before the by-elections, we heard ad nauseam the warnings given by Opposition speakers, who cried: “Beware of the Budget. It will be savage.” The Budget has been savage but now we are being criticised for not making it much more penal and much harsher.
If this were an election year we would be accused of bringing in an election Budget but the next general election is three or four years off and so there is no need for the Government to do any window dressing. This shows the honesty of the Minister and the Government that they have brought in this brave Budget. It is only being opposed by certain member of the Opposition. It was stated this evening that some Members of the Labour Party would not vote against it. I do not know if that is true; admittedly, some of them did not vote in the earlier division. If they abstained deliberately, I congratulate them. This may be the dawning of a new approach to our common problems in the House and the country.
It has been said that the Minister ignored the economists and would not take their advice. I do not believe this: I believe the economists would be heard but I do not think any Minister for Finance would allow himself to be ruled by economists. There was an incident in the United States in the 1960s and the then President, after the Bay of Pigs episode, said: "Why should I listen to the experts who are so often wrong?" This could be true anywhere. Economists can be wrong; an economist is not charged with running the country or introducing the Budget and can only advise. It is the Minister and the Government who must take responsibility.
The Government are united in introducing this Budget and putting it before us for approval. I think it would be approved by the vast majority of the people if put to them as an issue. While I am sure the Opposition do care for the aged and underprivileged I think they have a guilt complex about social welfare. When they were in office no doubt they tried to increase pensions and other social welfare payments but because the economy was not in a proper condition to bear the burden they had to cut back very much on social welfare. I suppose it is human nature, when they see a Government here which can manage much better, to attribute ulterior motives to them and never to say: "We believe you are doing this because you believe in social justice—social justice which demands that the aged and underprivileged must have first call on the national Exchequer." Unless the economy can provide the money for these services it is no use telling the old age pensioner or the retired public servant or the handicapped person: "We would like to give you more but we cannot do so because the economy cannot bear it".
It may be said that each year there is a limit to what the economy can bear but, at the same time, we must take cognisance of the fact that under the present Government in every year since 1957 some increase has been given in social benefits. This is as it should be. It is what a social policy is all about.
We have a housing problem, as all growing countries have. When we are criticised for not having enough houses, let us accept that the only country with no housing problem is a dying country. We know that when our people emigrated in great masses we had not much call for houses here; they were housed in Birmingham, or London or Liverpool.
Our party refuse to accept that our people should be reared for export and the whole basis of Fianna Fáil policy is that we should create a society which will offer a full life to our own people. Only two or three weeks ago Mr. Con Murphy—I do not know if one would describe him as an economist but he has produced several excellent reports such as that on the Dublin docks and I think the maintenance strike—forecast that emigration could come down to 5,000 a year. I do not think it has ever been lower than that because, for different reasons, some people will always emigrate. One can call a missionary or a person going to do some social work abroad an emigrant. Thank God, after all these years we are approaching the day when emigration will be down to a very small trickle and those who wish to stay and work here will have the opportunity of doing so.
A Government must take measures to correct the imbalance of payments and inflation and every Government in the world is doing so at present. It depends on the outlook of a particular Government and also on the conditions in the country as to how they do it. Britain did it by pegging back wages and by putting a levy on imports although they had agreed not to do that in our case a few years earlier.
People say we should have an incomes and prices policy and nobody will disagree but I do not know any country that has so far worked this out perfectly. Britain, I think I am right in saying, is trying to do so but has not yet put it into practice. They have encountered tremendous difficulties. I believe that some day, and the sooner the better, we must sit down and work out a policy on wages and incomes not based on any foreign pattern because our problems may be different from those of Britain, West Germany or Sweden, countries that all share this problem.
I have often thought that with our very bad record in industrial relations the trade unions, the employers and the Government should, in the interests of all, try to work out a system whereby, as the gross national product increases, so also will the disbursement of wealth back to the people who created it. We believe we should do this democratically but we reject any kind of soulless socialism. We feel our people are quite confident and willing to work to create a society where there will be, first, full employment and an adequate return for the worker, whether he works with his hands or brains or both. This must come sooner or later. I hope it will be sooner because we must think of the families with no houses and the men with no jobs and these should be our first concern. Throughout our history our people have made many sacrifices for a common ideal. Even though we live in a permissive society and in a world of rank materialism, I think that with our history we could rise above these things and bring about the changes that are necessary to remove the faults which prevent us from having the type of society we seek.
For a politician the Budget is of absorbing interest. For an economist it is an exercise in economics. For the old age or blind pensioner or for a man earning an inadequate wage, it is something more than that. It means real life to these people. If you take the dead figures from their columns and realise what they mean to thousands of our people, then they become alive. Instead of the Budget being just another financial resolution we must read behind it and see what it can mean for the country in the coming 12 months.
People I spoke to in the city have welcomed the Budget which was introduced last week. To old age pensioners and old people to whom I have spoken their hero, their pin-up boy, is the Minister for Finance. That is as it should be. He has given his great ability to introducing a Budget which seeks to spread the wealth of the nation more equitably. Let us hope he will continue to do this until we can say we have gone as far as we can in distributing the wealth. Apart from the social welfare payments the Minister has, by his aids to industry and agriculture, ensured that employment will increase so that more wealth can be produced, which means more for distribution.
The economists always told us that the national economy was like a cake. If it was a small cake there was less to go around. If it was a big cake there was more to go around. Perhaps we are falling down in not recognising this. From all sections there are demands for more and more benefits in every way. Unless the economy has been geared to increase production, these demands cannot be met. Members of the House on my left may decry capitalism and say that the profit motive is unworthy. That is a great fallacy because, if you look at our trade figures with countries behind the Iron Curtain, you will see that they sell us more materials than we sell to them.
They can produce goods cheaper than we can. They have a profit motive all right but, while we here may have a profit motive in individual firms, they have a profit motive at government level. In this way they are able to outsell us in many markets. I am glad that in his Budget statement the Minister referred to this fact in a general way. He stated that our embassies have been instructed to go out and negotiate new trade agreements. We may have qualms of conscience about dealing with some of the totalitarian states. We may be inclined to ask how are their goods produced, is there industrial democracy, or are the workers still hounded? To my mind we should not deal with these countries until we are quite sure that the dignity of the individual is recognised. We cannot do this. We cannot go into those countries and probe every aspect of their organisations. We buy goods from them but we must trade with them £ for £. The Government should tell these countries that unless we trade £ for £ with them, the deal is off.
An effort was made some years ago, and is still being made, to get our people to buy our home produce. I heard Deputies say how hard it is to buy Irish made products in our shops. Anyone who goes to buy even certain articles of clothing will find this. Very often you are offered the imported article. Perhaps it is from Red China, or from somewhere behind the Iron Curtain. If people want to back the Government in their policy of building up the economy they must buy the products of their fellow workers in this country. I would regard an article made in the Six Counties as being just as Irish as an article made in the Twenty-Six Counties. Women's organisations in particular could do a great deal more—and I admit they are trying hard—to try to induce the housewife to buy Irish produce as far as possible, to help to keep their husbands and sons in jobs.
I have stated that, like other countries, we have a housing problem. We are overcoming it but I wish we could accelerate the rate of building. Between 1960 and 1970, 98,000 houses were built and 60,000 dwellings were improved with the aid of grants. In Dublin at the moment, as a result of the wise purchase of land, we have sites for over 50,000 dwellings. If tomorrow morning we had all the money we need for housing, I wonder could the building trade step up its output so that, instead of reducing the housing shortage to minimal terms in, say, the next five years, we could do it in three years. I regard it as being only phase one of the housing drive to house our families in modern homes. I have always refused to accept the figure of 4,000 approvals because I believe it should be 8,000.
At the same time, I want to emphasise to the agitators in this city— and some of them come in very respectable guise—who shout about 10,000 homeless families, that this is an utter myth. There are not even 10,000 applications for houses. I hope that the Government, the building trade and the employers will accelerate the drive for more houses. I regard the lack of houses, emigration, unemployment and industrial relations as four of the great problems facing us.
We are thankful that emigration, unemployment and bad housing are dwindling problems. We can look forward to the day in the seventies when we shall have full employment and practically no emigration. However, we will still have a housing problem because of increased population. People are now demanding a better standard of living and we are faced with the fact that not alone in the cities but throughout the country, and particularly on the eastern seaboard, there is a great demand for houses. It cannot be said that this Government have ever lost sight of the fact that we need more dwellings. I hope that in the seventies we will increase by 50 per cent the output of housing of the decade just past.
We find many cases of people coming back to Ireland to settle down. Deputy McLaughlin mentioned the plight of the west and he used that horrible term "save the west". I sympathise with the Deputy; it is one of the saddest sights when one goes to the west and sees the vacant houses there. However, if one went to Scotland or parts of England one would find the same situation existing there. On the continent they are moving people from the land because of a change in agricultural policy. These people are moving into towns. The same situation is occurring here. Up to recently most of our people came from the west and from rural Ireland. However, they did not stop at the eastern seaboard; they moved to England or to the United States.
A major problem exists for the Government, not merely of saving the west but of revitalising it. I do not know if industrialisation is the answer. In parts of the country we have, even now, major labour shortages. In some trades there is over-employment and here is a task for our educators. We need more tradesmen. It is the job of the educators to try to dispose of the old Irish tradition that a boy who became a clerk was superior to a boy who became a craftsman. This sentiment is dying but not quickly enough. It should be part of our educational system to instil more worthy values in our people. In this computer age prospects are not very bright for the clerical worker but we shall always need craftsmen. I am aware of the strides made in vocational education, where a boy or girl can now take their intermediate certificate, but I think greater stress should be laid on the fact that for a young person with a trade the world is wide open, should he or she not wish to stay in Ireland. The old dictum of being "a hewer of wood and a drawer of water" which has affected so many of our people throughout the ages should be dispensed with completely.
At the moment there is a problem in regard to the rents of local authority houses in cities. It is a question of finding an equitable scheme, fair to the tenant and the rest of the community. This situation could be helped by providing larger housing subsidies but to do this we must increase taxation and this burden will fall on the people we are trying to help. However, I do not think it is beyond our tenants and local authorities to work out a system that will help the needy family. For the young man raising a large family on £12 or £13 a week, although his rent is assessed accordingly, I consider the rent too high. We should be able to increase the allowance made by local authorities in respect of children. While the family are still young they should be helped in every possible way, but when they grow up and go to work, then the rent which the local authority states is equitable and fair should be paid. There is no easy solution; one cannot have cheap housing merely by wishing for it.
I am aware that local authorities are trying to introduce a better scheme of rents. At the same time, having spent many years on the Dublin Corporation, I know of all the snags. We must face the fact that people have to pay rates on their houses and this particularly affects those on fixed incomes. I can quote a sad case of a widow whose husband thought he was leaving her well-off as their house was mortgage-free but many widows are facing a frightful problem in trying to pay the rates on their properties.
Some years ago the Minister introduced a scheme for derating agricultural land. At the time I welcomed this step forward but I also stated then that I would have liked some scheme of derating in respect of urban dwellings. The rates of urban houses increase each year and the burden gets heavier for widows with young families who need all their money. This year the Minister for Local Government brought in an Act which is giving some relief to certain sections of the ratepayers. Today an old age pensioner came to see me; he was very happy because he had got a 50 per cent remission on his house. The amount was £20, which is a considerable sum to an elderly couple. I think, however, we should go further on this matter. I do not want to discuss the rating system on the Budget debate but I have submitted proposals to the Government which I hope will be adopted. I look forward to a better system of rating; it must come. It may come about by increasing the rates on some of the big concerns who do not pay them now or it may come in the form of relief in the Budget.
We must accept, even if it means increased taxation, that there are people who are finding the rates burden a complete nightmare and must be helped. I do not believe the people will ever cavil at paying extra taxation once they know it will be wisely spent. Can you spend it any more wisely than coming to the aid of the widow, the young family or the young couple who have a house and who see the rates increasing yearly?
Today when the great accent is on education, we could spend our whole time in speaking about it. The achievements here are something for which we should be thankful and on which we can congratulate ourselves. Ten years ago public expenditure on education was £19¼ million. There were fewer than 500,000 pupils in primary schools, about 100,000 in secondary, vocational and other schools, and 11,000 in our universities. Today we spend £70 million on education. The numbers in the primary schools remain static but the numbers in the post-primary have increased 100 per cent. This is as a result of the enlightened education policy of the Government who are trying to ensure that each boy or girl who has the ability and wishes to avail of post-primary education will not be denied this because of the lack of means of their parents. In the universities there are now about 90,000 students. This is the age of the student revolt and from Berkeley in California to Dublin we have all seen evidence of this, and one accepts there are many students who are very sincere about this whole thing.
However, I should like to mention another type of student, that is, the child who may be mentally or physically retarded. In the dark ages of the past our attitude was "love from the parents" and from the community: "What can one do?" Now the Irish people generally, in common with other people, have seen what can be done for retarded children. In our growing economy we cannot afford to neglect these children. I would say that 6 per cent of them, if not more, can become useful citizens if we are in earnest about their problem. I would pay tribute here to the religious orders who, before it became fashionable to deal with this problem, were doing just this. Today we vote more and more money for the care of these children. We must build more schools for them and then we must attract the best brains of Europe and the United States to advise us on the best way to train these children so that they can play a full part in our society.
Then there are children without parents who are sent to orphanages and other schools. While they are quite happy and safe from the world while they are in these enclosed institutions, it is altogether wrong that when they leave these schools they have no training. We should broaden our educational schemes to cover them. In this way we can really say we are keeping faith with the people who fought to build this State. It eases our conscience if we can say we are doing everything possible through our educational system to provide education and training for the handicapped or retarded child. The largest section of our children go to the primary schools.
These would be matters for the Estimates rather than for the debate on the Budget.
I would point out, with all due respect, that they are in the Minister's statement.
We cannot have a debate on education on the Budget.
It is in the statement which the Minister supplied to us. There will be a tremendous increase in the demand for university education, as stated on page 11 of the Minister's statement. Whether we change the system or the structure of the universities we must ensure that post-primary education means education right up to university level. I am not suggesting everybody needs this or would even go for it but the facilities should be available to anyone who wants them.
It would have been very easy for the Minister to produce a business like Budget and save us almost £22 million in taxation. However, had he done so, he would not have catered for the public service, the social welfare improvements, agriculture, the care of the aged or, as Deputy McLaughlin mentions, the west and conservation.
It is only right, this being Conservation Year, the Minister should have seen fit to reserve £100,000 for this very worthy purpose. It will be very interesting during the year to see how the moneys are spent, because this is a very great problem. No less a person than President Nixon of the United States has launched a great campaign for conservation and against pollution. Our problem is of much less degree than theirs.
There is one question I should like to put to the Opposition as regards the turnover tax. In the last Dáil Deputy Dillon was speaking on a Budget and decried in his very able way the turnover tax. Some of the backbenchers here had the temerity to ask him, if his party assumed power, would they abolish it. He said it was impossible to unscramble an egg. I take it what he meant was that he would not. I put it to the Opposition now if by some chance or mischance they were on this side of the House, would they remove the extra turnover tax or, indeed, the whole tax? If they did, they would have to find £20 million extra in order to finance the benefits given in this Budget. I should like to hear how one finds £20 million without increasing taxation.
They may well say that they would tax luxuries like cigarettes, drink, motor cars and such things. Some may disagree and say that these are not luxuries. However, it is very difficult to find any items which would yield £20 million and the Opposition must make up their minds and tell us how they would raise this extra money. Would they simply avoid taxation by not giving benefits? I do not think they would get away with that. If you tax the old hardy annuals like cigarettes, drink and petrol you may well reach the point of diminishing returns and you may not get the revenue you expected. In addition it must be remembered that in a few years time there will be less revenue from tobacco. As we are aware television advertising of cigarettes will shortly be banned. The Government and the Opposition must consider where they will find extra revenue from taxation.
By that time too the percentage of our aged people will have increased and we will have to provide for them. I hope that by then our gross national product will also have increased and that our exports will have continued to expand so that we will be able to impose extra taxation to help less well off people. Nowhere is this more important than in our health services.
It has been my experience that a tremendous number of people do not know what they are entitled to under the Health Acts. I hope that the last Health Act will provide the blueprint for a system of much better health services. It will cost a great deal more but, again, nobody will begrudge this expenditure. There will, of course, be a problem in regard to the local authorities and who will pay for the services. Should the State pay more? We have often heard the suggestion that the cost of the health services should be taken off the rates but, if you do that, you will be giving relief to people such as the large private corporations who are contributing to the rates at present and instead somebody else will have to pay for them.
Let us be quite fair to the Minister. The amount from central funds is increasing all the the time. In the present financial year grants to health authorities will cover 6 per cent of their total health costs. This proportion is rising all the time and we can look forward to the day when we will see the total health costs being covered by the Exchequer. However, that is merely to say that we will pay health costs through other forms of taxation. At the same time, it will remove the heavy impost from ratepayers such as widows and those with young families who are purchasing their own houses. The health demand will continue to increase because with the development of wonder drugs life expectation has increased and in the future the science of geriatrics will play a much greater part than it did heretofore. This will also cost money. People here say that we should have health services with no means test, which would be very welcome, but if we had such a thing it would not be the less well off that would benefit but those who are very well off. Take people in the middle income group, around the £1,200 mark. These people could look for, and get, greater help under the health services. Like social welfare, the cost of the health services will continue to increase each year. This is as it should be.
These costs will continue to rise as long as we have a stable and growing economy which can afford this increase. The day when the economy is not in a position to do this we will be in trouble. We will be in real trouble unless we come to our senses in commerce and in industry, whether one is a trade unionist or an employer, and think of the great problem we have. It has been said on several occasions in OECD reports that we have one of the highest strike rates in Europe. As Deputy Kavanagh mentioned, a cement strike has been going on for three months. As this was before the Labour Court today I do not want to comment on it but I do want to draw attention to the fact that people are waiting for houses and thousands of building workers are out of jobs. Surely we can do better than this.
The officials of the Department of Labour are held in very high esteem by both sides in industry but we have got to improve industrial relations and create an atmosphere wherein any disagreement between employer and labour need not necessarily result in a strike. By all means let them have their differences but let them iron out their differences while the machines are still running and wage-earners are still drawing a wage.
The Government have often been criticised for allowing outside investment. In his speech the Minister mentioned that the ESB could undertake one of their greatest projects because they had been able to negotiate a loan on the Continent, through the Government. We have to make up our minds whether or not we welcome outside investment. There are some types of investment which we do not want. Certainly I would welcome investment in industry but I would not welcome it if it means that an outside competition and the contention is that it is better to sell out to these people because it means that the industry will continue to produce and to provide employment. I have heard some ill-considered criticism of the types who come in and invest money. The very fact that outsiders want to invest here is a tribute to the nation because obviously they feel that it is quite safe to invest here. It would be a wonderful thing if the people by their own savings and increased production could ensure that we did not need outside capital. Unfortunately, that is not the position. Perhaps it is not possible.
The Minister has shown his awareness of the need for savings by introducing the new scheme which I hope will be very successful in encouraging saving for investment for the benefit of the country while giving a return to the individual saver.
The question is asked: why should a person save in view of the continuous reduction in the value of money? It is true, but only to a certain extent, that money loses value. The need to buy money on outside markets at a very high rate could be offset by savings. The small wage earner will contend that it is difficult to save. I agree. The fact is that even the smallest amount saved by the poorest person contributes to the development of the economy. If the people save, our children on leaving school will find employment in their own country and will be able to enjoy a decent standard of living.
In the last decade there was a most remarkable growth in the economy. I say without fear of contradiction that it was the most successful decade in our history from the point of view of industry. It marked another milestone on the road to a better society in that for the first time in one hundred years the population showed any appreciable increase. I feel sure that the next census will reveal a further increase in population. It is gratifying that the economy is growing but that growth poses problems. Economists maintain that it is easier to solve chronic unemployment with a rising population than with a falling population. Our whole efforts must be geared to improving the economy. This is vital. Those who would sneer at a capitalist State must remember that whether it is authoritarian or socialist, a State has to abide by the laws of economics. A country that fails to produce wealth by its own exertions cannot expect the world to provide it. The world does not owe us a living. We have God-given intelligence and we should use it for the common good. If we do not, the blame is ours.
The Opposition feel that they must rap the Minister and the Government and the Fianna Fáil Party for what they call penal taxation. No Opposition speaker has given us a complete pattern of how they would provide the money to increase benefits without increasing taxation. That would be a worthwhile and most illuminating exercise.
In addition to the excellent provisions that he has made, the Minister has, I think, changed the pattern of Budgets. I admit that he has had more means of doing that than some of his predecessors may have had. In the past, Budgets were balanced first and then a small amount was given to the social welfare classes. The previous Budget and this Budget have changed the pattern. It has come to be recognised that it is not just what is left over after balancing the Budget that should go to the aged and other categories. A niche has been provided in this Budget for social welfare recipients and future Budgets will show our increasing consciousness in this regard. An economist's Budget might be a perfect exercise in book balancing but could be a very anti-social or unsocial document. Such a Budget would represent failure even though the economist could say that as long as the Budget is balanced the country will not go bankrupt, that while you may not have much more at the end of the year, at least you will have maintained your present position. It is not acceptable today that we should merely stand still, that we should regard the present level of old age pension as being sufficient. All the time, effort must be made to increase social welfare payments and to create a society in which the aged, the widowed, the young family will be protected and will be assured that the State cared for them.
The question has been asked as to why the North of Ireland should come in with us when regard is had to our social welfare code. I shall not go into this matter now. It is not the place for it. I do say that we are well on the road to building up the social welfare code so that it will stand comparison with any that we know of. The Minister for Agriculture and Fisheries pointed out this evening the great disparity between social welfare contributions here and in the United Kingdom. An examination of the figures will show that the social welfare recipient here gets much better value for his contribution than does his counterpart in the United Kingdom. Comparisons with the North of Ireland may be invidious inasmuch as we have to find our own money; we have not got a benevolent big brother to give us £100 million in subsidies per annum. It is all the more meritorious, therefore, that we have built up the economy to the point where it can afford the payments now being made.
It is not in any way a form of charity that the State acknowledges the rights and the needs of old age pensioners or handicapped persons. In the case of the aged they have a right to these increased benefits because they have made their own contribution to the national wealth during their earlier years. It is said that the mark of any civilisation is the way in which it treats its old people. I hope that, when our history is written, it will record that we made a great breakthrough in putting an end to problems such as emigration, unemployment and bad housing. I do not know of any economist who has yet discovered a magic wand which he might wave in order to give everything that is asked for without having to increase taxation. If such a man were in existence he would be much sought after by Governments all over the world.
With our entry into Europe probable within the next two or three years we must face the harsh realities of the economics involved in our becoming members of that group. It has been said that the turnover tax increase will acclimatise us to the new forms of taxation we will encounter in the EEC where there is an added value tax in operation. The fact is that up to a few years ago we lived in what might be termed a cloistered position. Our industries were protected by heavy tariffs but this year there is a reduction in these tariffs. We had certain problems during the 1960s but we have overcome many of them. However, during the next decade we must face even greater problems and we must gear ourselves to face the harsh realities which membership of the EEC will entail. We must be prepared to compete with people who have had many more years than we have had to prepare for membership. It will be interesting to see how the Minister, in future Budgets, will direct his approach to the new situation.
I was glad to note that in his speech, the Minister spoke of a national science council. At this time there is a great breakthrough in many of the sciences and, while we cannot afford to build reactor stations or even computers, at least we are trying to play our part in the advances of science. The setting up of such a council is probably one of the most exciting events to happen for a long time. Of course, the cost involved will be great but it will be money well spent. Anyone who visited the Young Scientists Exhibition at Ballsbridge will appreciate the great extent to which our young people, as a result of new educational standards, are taking an interest in science. Some day we may even produce an Einstein but for the moment, at any rate, we are interested in ensuring that our young people have all the facilities necessary for the study of science. Of course, we must ensure that on leaving university these young people will be able to obtain posts here and so make some return to the country for the opportunity it has afforded them. There will always be some who will emigrate but, when they do, it is better that they emigrate as trained people and so give their talents in helping to build up some other economy and in contributing to the progress of man.
During the years the Government have had programmes published for economic advancement. If all the targets in these programmes were to be reached we would have a blueprint for the future of science; but of course there is nobody involved in the science of economics who can guarantee that any programme drawn up will reach full fruition in any specified time or, indeed, in any time; there are factors at work for and against such a forecast. Therefore, when we suffer a setback in economic planning we must allow a margin of error in the preparation of the programme. All we can do is to learn from the experience of other countries in so far as their approach to economic problems is concerned.
I should like to see a greater broadening of education. Perhaps there could be an interchange of teachers whereby teachers from secondary schools could teach in primary schools or others and vice versa. Parents in this country have always shown that they are prepared to sacrifice a lot in order to ensure that their children receive proper education. I am aware that the amount being set aside for education in this Budget is tremendous but I would like to see some further provision whereby the parents of a child receiving post-primary education and who suffer a loss in wages might receive some compensation. The Estimate speech of the Minister for Education was very helpful and I am hoping that some of the new provisions will help in this direction. However, these are matters for discussion on Education rather than on the Budget. My point is that the Budget is the source which provides the money for the various Estimates and it, therefore, provides one with an opportunity to comment not alone on specific policy but also on such matters as education, social welfare, housing and other matters appertaining to the Budget.
The Chair cannot accept the Deputy's contention. The Chair cannot accept that interpretation of the purpose of the Budget debate.
The Minister's statement refers to all these things.
The Chair accepts that that is so but the Minister's statement deals with these matters in a general financial context. Details applicable to Estimates must be discussed on the appropriate Estimates.
I am not questioning your ruling but I have been on the Budget all the time.
If the Chair were to permit the Deputy to go into details applicable to Estimates on the Budget, then every Estimate, as the Deputy will appreciate, could be debated on the Budget.
I am not questioning your ruling.
Is it not permissible to discuss every matter on the Budget?
The Chair has pointed out on many occasions that primarily what can be discussed on the Budget is taxation in general. Details applicable for discussion on Estimate must be confined to the debates on the Estimates. When Estimate are before the House the opportunity is given to Deputies to go into detail on the various Estimates.
It is very hard to follow.
It is very old ruling.
It may help the Deputy when I say this is a debate on finance generally.
I appreciate that. The Minister for Finance has the task of finding the money so that all the various services can be provided. I should dearly love to hear some Member of the Opposition tell us where the fault lies in this particular Budget. It is very easy to point to an increase in taxation. Of course there is an increase in taxation. Any Budget worth anything must increase taxation. If services are to be extended and improved the money must be found to finance such extension and improvement. People are, quite rightly, demanding better standards. The Minister must find the necessary revenue to help improve standards.
In this Budget the Minister proposes to raise the necessary additional revenue by increasing the turnover tax. When the turnover tax was first introduced seven years ago there was uproar. There was a great deal of misrepresentation. No one likes an increase in taxation. It was, I think, Edmond Burke who said that no one has ever yet found it possible to increase taxation and remain popular. It is not a question of remaining popular: the Minister must do what is right. He has done what is right in this Budget and I honestly believe the Opposition know in their hearts and souls it is right because they have so far been halfhearted in their criticism of it. The vote against it was not very big. Some Deputies were away. Others were ill. It was whispered that some would not vote against it. I should like to believe that.
I hope the Deputy will wait and listen to what I have to say.
I have listened to the debate so far and I can only describe it as a milk-and-water debate. I should like to hear helpful criticism.
Constructive is the word.
It is a much abused word. I should like someone on the Opposition benches to tell us how we can improve social welfare benefits without increasing taxation. The Labour Party talk about corporation tax and excess profits tax. I am not opposed to such taxes but I know they will not bring in the money. We have not got enough millionaires to tax heavily enough to enable us to avoid increasing the turnover tax. Some day we may have enough millionaires and then, perhaps, we may not have to tax the ordinary people, but even in the United States and other wealthy countries they still have to tax the ordinary people because even the millionaires are not sufficiently wealthy to carry the whole burden.
The Budget is the instrument by means of which the economy is financed. The economy cannot be properly financed without increasing taxation. There are some who would seem to suggest that we could spend the additional £22 million needed this year without in any way increasing taxation. This is impossible. Our very able Minister for Finance, the experts who advised him and the Government believe that the best way in which to find the moneys required is by increasing the turnover tax. So far no one on the Opposition benches has come up with any better suggestion. I am sure if some better method were suggested the Minister would be only too happy to adopt it. Perhaps the annual Budget is not the best way of doing the State's housekeeping. Perhaps other countries have found a better way. Some may prefer two Budgets in the year. Others may prefer a Budget every two years. The Minister has shown a refreshing approach to change. We have now a capital and a current Budget. We know from whence the revenue comes and where it goes. It may well be that that pattern will change.
Our industrial relations would appear to be bad and people on both sides of this House have condemned wild-cat strikes. The Fine Gael Party this evening gave a demonstration of a wild-cat strike.
The anarchist dragged them out.
I will not refer to this at length but this evening's incident did the Fine Gael Party no good. That does not matter a great deal; what does worry me is the fact that this is our national Parliament. Ours is a democracy which is not a kind of self-perpetuating system. It is a very delicate thing and if the actions of any party here bring Parliament into disrepute it should be remembered there are only too many people anxious to see an end to democratic institutions.
The Minister for Local Government should pay attention to what the Deputy is saying. He walked out. He also bullied his way in here with his thugs. The Government Members should pay attention to what the Deputy is saying.
We should now return to the Budget.
I referred to that matter because it was part of the Budget debate. The Minister for Agriculture and Fisheries made a masterly contribution this evening to this debate. He dealt perhaps more extensively with agriculture. It was an education to listen to him speak on the contribution that agriculture makes to the Budget and the contribution the Budget will make to agriculture. If I have spoken more on the industrial side rather than the agriculture side it is, perhaps, the urban mind against the rural mind. There is room for both here. In the Budget the Minister has given about £90 million to agriculture in rates relief and contributions to various schemes. The Minister had to find this money as he had to find the rest of it. Money has been found to the extent of almost £475 million. We have the happy result that the Budget will benefit not only the agricultural and industrial sectors but also the aged and handicapped. If this sets the pattern for the future development of the economy, it is a good augury. I hope there will be a further increase in social benefits in the Budget of next year—if it is still in its present form— and also greater aids to industry and agriculture. An economy cannot stand still. We must go forward so as to provide for the growing population and we must admit, no matter on which side of the House we are, that the economy is buoyant and gives promise of better things to come.
The Budget has been well received, judging by the reactions of those to whom I have spoken. Nobody looks forward to paying more tax but we are realistic enough to know that you cannot have good social services without adequate taxation. The people who decry taxation remind me of a recent song to the effect that everybody wants to go to Heaven but nobody wants to die. Everybody wants to give great social benefits but nobody wants the task of imposing extra taxation. The present Minister for Finance and his predecessors have created a new concept of the annual Budget. It is not just a matter of balancing the books but of distributing more widely the national wealth. As long as Parliament exists and we have a democratic Government I am confident that, with the greater awakening of our social conscience, the Budget will become more and more the instrument of social progress. I hope it will become the hallmark of fair taxation. If anybody disagrees with this concept of a Budget there is little place for him in our society.
If we are to continue increasing social benefits we must go on increasing the national wealth. Unless this happens we shall not have the money to improve the benefits, as we all desire. I emphasise this because of statements inside the House and outside it. Street corner speakers have no responsibility but we, whatever side of the House we occupy, have responsibility. The people elected us to make our best contribution to the running of the country, to offer constructive criticism and oppose anything we think is not for the common good. In seeking a good common to all I think the Minister in his Budget has shown his willingness and his desire to fulfil his responsibilities. In this Budget he has remembered the weaker sections of the community. If you go through the Budget you find that every section, even the itinerants, are being helped. A few years ago one would not expect any reference to itinerants not because we are callous but because urban people, at any rate, did not think about this problem. There has been in Europe generally, and particularly in Ireland, a social awakening. We now realise it is our duty to provide for all in need. The wealthy people are able to care for themselves. I think the whole reason for a Budget is to ensure that the wealth that is being produced will be distributed according to need and any country accepting this principle is not far wrong in its attitude to things that really matter.
If we were to have some great disaster during the year we would find money very quickly by some means to cope with it. My point is that the Minister has put forward figures which, if there is no untoward happening, will suffice until the end of the financial year but if something happens and we have to find more money the Government would act quickly to procure it. Again, it would have to come from taxation and if the people believed in the worthiness of the cause they would contribute happily.
I think the people have accepted this Budget. I do not know if I can say it has been passed here because it still has to be voted on but, whether we have passed it or not, the people have accepted it. The vast majority of the people have accepted it with good grace, and why not? It is a good Budget. It may be said that the turnover tax will impinge on the weaker sections of the community but, if you look at the figures for the social welfare payments which are being given and the estimated increased cost of commodities, you will see that, even allowing for that, the recipients of social welfare payments will still be better off than they were. That is as it should be.
The point is that we must tell the people the truth about the turnover tax. The housewife is perhaps more realistic than other sections of the community. She has to manage on the salary or wage of her husband each week. She is in a way a minor Minister for Finance. She cannot impose taxation. It is the duty of the Government to do this so that the revenue may be put to good use to make our people better off.
No one can criticise the Budget for lack of professionalism and preparation. It was unfortunate that the Minister could not be here to introduce it. The Taoiseach, who is an ex-Minister for Finance, introduced it and I think the House accepted what he stated. Even though some Deputies criticised his speech, I think that a Minister coming into the House with a Budget like this has an easy task. The hard work has gone into the preparation of the Budget. We get the end product here and we realise the amount of work the Minister, the Department and the Minister's advisers have put into it. They have been influenced to a great extent, I am sure, by public opinion and public needs. They are not unmindful of the fact that many of our people have not yet reached the desired standard of living which we all want them to have. They have taken steps to bring the people along the road towards a proper status.
The fact that the social welfare payments have been stepped up emphasises the desire of the Government to go on improving our social welfare code. We do not have to compare with other countries. We want to satisfy ourselves in our own hearts that this is the best we can do for our people within our resources. We want to ensure that with good Government these resources are built up but not for the sake of attaining some status or proving that the Government side is much better than the Opposition. That is a very shallow outlook. The Government want to build up the economy to allow for a much greater distribution of wealth amongst our people.
We want a society in which each family is housed in a family-owned house preferably, in which each man and woman can get a good basic education and in which those who have the ability can go forward to post-primary education. All these things cost money. The source of all these things is the Budget. I certainly support the Minister in his Budget but, at the same time, I want to put something to him for consideration. A year or two ago the Minister derated some agricultural land. I should like to see in the urban areas some kind of derating system for houses. This year a Bill was brought in by the Minister for Local Government which gave some relief to people who had a rating problem and who had not the necessary wherewithal to meet the rates. I look on that as a start. It is reflected in the Budget. I hope that next year the Minister will try to equate the agricultural holding which has been derated with an urban dwelling and apply the same derating policy.
It may well be said that the people in the rural areas who got this benefit needed it. Perhaps they did. I will not argue that. A principle has been established. I know the Minister is aware of this problem and the fact that he has not tackled it this year is not due to any reluctance on his part to do so. He had to provide the increases I have already mentioned. You cannot do everything in one Budget. This Budget has set a new headline in social welfare payments. It is not so long since the old age pension was 10/- a week. The old age pensioner will now get an extra 17/6 per week. I am not suggesting that he will live in affluence on this extra 17/6d. I realise that we must do much more for them. The important thing is that this is being done within the limits of our resources and it augers well for the future.
Everybody rejoices in the fact that these increases are being given. Could not those who criticise the Budget and those who voted against it—to my amazement—have said: "We do not like new taxation but we realise that this sets a new high in social welfare increases"? Could they not have said: "To record our appreciation of this we will not oppose it"? If they said they could not vote for the turnover tax, well and good; but at least they could have said: "We will not vote against increases in social welfare because we regard them as being very worthy indeed." Future generations may well look back on the records of this House and see that the Opposition parties voted against increases in social welfare.
No, we voted against an increase in the turnover tax.
They voted against increased social welfare payments.
We voted against a Financial Resolution.
They voted against this. They did. I would excuse any new Deputy but this is what the Deputy's party did, and the Labour Party.
The Deputy must have a little commonsense.
The record is there.
We voted on the turnover tax.
I know that Deputy FitzGerald did not speak but Deputy O'Higgins could have put forward something like this the other night to try to separate them.
I spoke for an hour and three-quarters.
But that was not before the Vote.
He is playing for time.
I am not playing for time.
He has been playing for time for the past hour.
I want to emphasise that the Fine Gael Party and the Labour Party voted against the increases in social welfare payments.
On a point of order, this is the second time that a Fianna Fáil Deputy said that.
That is not a point of order.
The first Deputy was Deputy Burke. We voted against Resolution No. 2 only.
That is not a point of order.
Surely if repetition is out of order, repetition of an untruth is doubly out of order.
Misrepresentation is out of order.
If only two Fianna Fáil Deputies have said that, there are 75 to say it.