asked the Minister for Finance if he intends to phase out food subsidies.
9.
Ceisteanna—Questions. Oral Answers. - Food Subsidies.
8.
asked the Minister for Finance if any policy decision has been made on the future of food subsidies.
10.
asked the Minister for Finance the decision, if any, to phase out food subsidies which has been taken by the Government; and if he will make a statement on the matter.
I propose, with the permission of the Ceann Comhairle, to take Questions Nos. 8, 9 and 10 together. I would refer the Deputies to the reply which I gave Deputy Noel Browne on 27 June 1978 in answer to a similar question tabled by him. That reply still represents the most up-to-date position in the matter.
What is the status of the recent speculative remarks of the Minister for Economic Planning and Development, who entertained the idea of phasing out food subsidies?
I am assuming from the Deputy's question that he is unaware of the references at pages 83 and 84 of the Green Paper on Development of Full Employment which referrred to this matter.
To what effect? Saying they would not?
They give the up-to-date thinking of the Government in this regard.
Would I be correct in saying that the pages and references referred to by the Minister indicate that the Government's intention would be to phase out food subsidies over a three-year period?
I do not think that would be correct. The Deputy will be aware that the Green Paper referred to various options and possibilities and that the options and possibilities in relation to food subsidies were referred to in the pages I mentioned.
Were they referred to in the context I mentioned—that one of the possibilities being considered by the Government would be a phasing out of food subsidies over a three-year period?
I do not have the reference in front of me but speaking from recollection I do not think it referred to three years, but it did refer to the possibility of phasing out.
The Minister referred the Deputy to the pages in the Green Paper but when he is asked to state precisely what is in it and when I state what I believe to be in it, he says he does not have the reference.
If the Deputy did not bother to read the Green Paper which would tell him what was the latest issue from the Government on this matter, I cannot help him except to the extent of telling him again where the references are so that he will not have to thumb through the whole paper.
I have quoted it. I read the paper. The Minister wrote the paper and he apparently does not know it.
I know what the Government's position is in the matter. That is what I was asked.
Let us in on the secret.
I have replied to it, and told the Deputy that the up-to-date position is as set out in the Green Paper.
Reducing food subsidies?
Would the Minister accept that one practical effect that would follow from any reduction of the food subsidies would be an immediate rise in the price of basic foods for a great number of our population? Does he accept that a high proportion of the income of the most necessitous categories in our population is spent on these basic foods? Would he accept that there can be no tinkering with the food subsidies because of the adverse effects which such reductions would have on the living standards of the poverty-stricken sections of the population?
No, I would not accept what the Deputy says.
Which part?
The Deputy seems to suggest that there could be no question in any circumstances of interfering with the food subsidies, and I do not accept that. In regard to what Deputy Cluskey said I have now the reference from the Green Paper which says that the more appropriate approach would appear to be to phase out these subsidies over a period of years. Does the Deputy now accept that his quotation was not correct and that my recollection of it was correct?
As the Minister was one of the authors of the paper, would he state what the Government mean by "over a period of years?" Do they mean three years, five years, ten years or 20 years?
What does the Deputy think the phrase "over a period of years" means other than over a period of years?
Over what period?
If it meant over a specific number of years it would say so.
The Minister does not know. Is he saying he does not know what the phrase in the paper of which he was a joint author means?
It seems to me to be self-explanatory.
The Minister does not know. I accept that.
Does the up-to-date position of the Government include a further dimension? Do they accept the request of the European Communities that the subsidy on bread be abolished? Is it the intention of the Government not over a period of years but in the relatively near future to abolish subsidies on bread and accept the Community view on that matter?
That is a repetition of the question on the Order Paper which has already been answered.
I am talking about food subsidies.
It is a repetition of the question as on the Order Paper.
In view of what Deputy B. Desmond has said might I say that his version of the view of the EEC is not correct?
May I ask the Minister if a particular request has been received by the Government to withdraw the subsidy on the price of bread as being contrary to Community alleged regulations, that the Government have accepted that Community position and intend to abolish the subsidy on the price of bread in the immediate future, not over a period of years?
The answer to each part of Deputy Desmond's supplementary is in the negative.
It is not at all negative.
Would the Minister agree that as food subsidies between August 1977 and August 1978 rose by over 10 per cent and that as this is the major item of expenditure of the poorer sections of the community to remove food subsidies in the future would impose a further severe burden on these sections?
Surely the Deputy is aware that food subsidies were introduced at a time of enormous inflation, which is considerably less now, and he is also aware that it is possible to take measures which will ensure that the impact on the poorer sections of the community would not be as he said if there were a reduction or phasing out of food subsidies.
Does the Minister accept that the rate of inflation between August 1977 and August 1978 is less than the rise in food prices in that period and that food prices consist of a major portion of the expenditure of the poorer sections of the community? Therefore an increase that would compensate them for that must be significantly more than the rise given in last January's budget.
The matter is a little more complex than as indicated in the Deputy's supplementary question.
Whatever about the Minister's interpretation of what the Green Paper said I should like to know—and the Minister is the person principally who will be making the decision on this—does he accept that since a high proportion of the income of the welfare classes, or the poorer sections of the community, is spent on food it would follow that it would be a savage onslaught on their living standards if the food subsidies were phased out over any period? Does the Minister accept that that effect must follow?
This question has been repeated many times. I am calling Question No. 11.
I do not think the Minister accepts that.