Can the ACC make their own arrangements to borrow up to a certain ceiling or do they arrange a loan on the Continent and then seek the sanction of the Minister?
Agricultural Credit Bill, 1979: Committee and Final Stages.
Section 1 agreed to.
SECTION 2.
Question proposed: "That section 2 stand part of the Bill."
The only time the Minister gives his sanction is when it is a specific big borrowing from outside the country.
Does the Minister of State mean that they can make small borrowings without the Minister's sanction?
Yes.
I do not know the Minister's definition of small and big borrowings and it would be helpful to have it. On Second Stage the Minister said that it was necessary financial discipline that they should be subject to his control. How can control be exercised if they are allowed to make a series of small borrowings which could equal the amount of a big borrowing?
We are also talking about exchange losses. The Minister would have to find out what was involved in the borrowing.
I am talking about borrowing.
(Cavan-Monaghan): Surely there must be guidelines under which the ACC operate. Surely the Minister or his advisors are aware of those guidelines. What Deputy Barry and I want to know is the limit imposed on the ACC in relation to borrowing. In 1979, with inflation at such a high rate, I would not regard £25 million as a big borrowing.
It is not a big borrowing in the context of this Bill.
There are no specific limits on borrowing but the ACC are in close contact at all times with the Minister for Finance.
Is it not right to say that all foreign borrowings must have the approval of the Minister?
They would have to be in close contact with the Minister in relation to borrowing.
It is my information that all foreign borrowings must be approved by the Minister. Is that true?
That is right.
(Cavan-Monaghan): On Second Stage I made the point that it was most inappropriate that the ACC should be subject to the Department of Finance, that it would be more appropriate if they were subject to the Minister for Agriculture. The Minister of State, who was sent in here by the Minister for Finance, who is, apparently, the boss of the corporation, told us that there was no control over small borrowings. He implied that there was control over large borrowings. The Minister of State now tells us that there is no control but that they are in close contact with each other. A child is in close contact with his father and he has to ask his father for any money that he wants. Apparently there is some sort of similar close contact in this situation. It emphasises the point that I was making: that the wrong Minister is the father figure, that it should be the Minister for Agriculture. The House is entitled to know what control the Minister for Finance exercises over the ACC in regard to their borrowings. That is a fair question and it should be clarified. There may have been irrelevancy on Second Stage. If anything is irrelevant at this stage it is how the corporation exercise their borrowing rights. The Minister should clarify the position before we go any further.
There are no hard and fast rules in relation to this matter. The Deputy has suggested that the ACC should be under the control of the Department of Agriculture. As the ACC have been in existence for a long time, the Deputy should have done something about it before now. If the Deputy believed that this was the best course, he had four-and-a-half years in office in which to do something about it.
(Interruptions.)
(Cavan-Monaghan): The Minister should have given that reply on Second Stage. We are now on Committee Stage and a specific point was put to the Minister.
There are no specific restrictions. Close co-operation is expected between the Minister for Finance and the corporation.
I should like to deal with the political point made by the Minister of State. I hope that he and any other Fianna Fáil Deputy that comes into the House is listening because we have not seen a member of the Cabinet all week, with the exception of the Minister for Finance who made a contribution to our Bill. It is evident that the Cabinet have disowned responsibility——
Acting Chairman
The Chair would prefer that the debate be confined to the section.
The Minister said—and he was not corrected by the Chair—that we should have done something during our four-and-a-half years in office.
Acting Chairman
The Chair was about to correct the Minister. The Chair would not welcome any widening of the debate on the section.
The Fianna Fáil Party fought the Cork by-election on the basis that the National Coalition Government did not work and that was the theme song of the Cork papers for a fortnight. On the 7th of this month the electors of two constituencies in Cork gave the Fianna Fáil Party their answer. They told them to stop whining and to do their own work.
Acting Chairman
The Chair fails to see the relevance of this argument to the section.
In future any time I hear a member of the Fianna Fáil Party saying in this House "why did you not do that when you were in Government" I will remind him of their advertising campaign in the Cork by-election and the answer they got from the Cork people to those advertisements, so let none of them raise it again.
As regards the money, obviously— and I cannot see why the Minister does not come out and say it— the Agricultural Credit Corporation cannot borrow freely abroad without the sanction of the Minister for Finance. That must be a fact; otherwise one could not run a country. What I am trying to establish is: are they allowed to do so up to a certain limit by the Minister, say £100 million; then go away and, when they have used up that figure, come back to the Minister, or do they go abroad and examine the possibility of borrowing £7 million, £8 million or £11 million from different banks around Europe, coming back to the Minister seeking sanction for each specific one? That is a small point but there must be a rule about it and the Minister should tell the House.
I am trying to explain and to outline the co-operation existing between the Minister for Finance and the ACC. The Minister for Finance has general control over their lending policies; he has a general control. But the ACC do not need any specific approval for every penny they borrow. What I am trying to say is that there must be co-operation between an institution like the ACC and the Minister for Finance. I think I have cleared the matter; I have tried to.
I can understand, of course, that there must be co-operation because the ACC comes under the control of the Minister for Finance. Is the position now that the ACC can go abroad and borrow moneys provided they do not exceed a certain ceiling? Is that the position?
They do not need specific approval for every penny they borrow.
Therefore, there is a ceiling put on the amount they can borrow and they make that up as best they can?
I assume that matter is brought to the attention of the Minister for Finance, as is whatever discussion takes place here.
Is there control on the amount that they may borrow in specific foreign currencies?
The answer is no.
If there is not that control then is it possible for the ACC to borrow in a currency which it might be the opinion of the Minister for Finance and his officials, on the basis of their knowledge of likely prospects in exchange markets, is a bad currency for them in which to be borrowing because it is a currency likely to increase in value thereby ensuring the repayments will exceed the amount received?
If there is no control on the ACC in this matter, is it not possible that they would be making very unwise decisions as to borrowing in particular currencies as against other currencies? Indeed there has been experience in the past, if I am not mistaken, of the ACC borrowing in Deutschemarks before the Deutschmark rose, and finding that they had to make very substantial repayments far in excess of the amount they actually received because they had borrowed at the wrong time and in the wrong currency. The Minister tells us now that there is no control on what the ACC may do in this matter. That seems to me to be a very bad thing because there should be general control as to particular currencies if we are to avoid a recurrence of the unfortunate event I have mentioned, when this country and the ACC lost because they borrowed in the wrong currency and at the wrong time.
I appreciate that there is general control in the matter, as the Minister has said. If there is merely general control but no specific control, and the ACC may borrow in a way that is against the wishes of the Minister—up to the limit they have of £600 million—it seems that if the Minister disagrees with this the only recourse available to him is to sack the board. Is the Minister saying that his control, in effect, amounts to nothing more than the possible exercise of the threat of sacking the board? If that is what he is talking about, if that is the control he is exercising, or the weapon he has to use to exercise it, then I believe it is insufficient because of the vagaries of the international exchange market. As far as foreign borrowing is concerned I believe there must be more specific control, certainly if not at the particular banks from which they borrow—a matter that could be appropriately left to themselves—at least as to the amount and denominations of foreign currencies in which they borrow.
The only ceiling is on the one that is now being voted.
(Cavan-Monaghan): The six hundred million?
That is the only ceiling.
That is not very satisfactory.
(Cavan-Monaghan): I have not the Minister's introductory speech before me, but my recollection is that the Minister did say that he recently had authorised the borrowing of £25 million abroad. Would the Minister tell us, in relation to that transaction, why authority for the borrowing of that sum was necessary, if it was necessary, and, if it was not necessary, why the Minister was involved?
In fact I think the reason given by the Minister in his opening speech was that this Bill was necessary in a hurry because of the £25 million.
I mentioned in my reply the question of exchange loss.
What has that got to do with it?
Well, the Minister would have to guarantee it.
It is not correct for the Minister of State to say that the Minister will guarantee the exchange loss. As far as the ACC are concerned, if there is an exchange loss, they would have to carry it themselves. The Minister does not guarantee the exchange loss.
I think he does for this £25 million.
Where the £25 million is concerned, the Minister has guaranteed.
Yes, he has, for this one.
May I take it then that the Minister will carry any exchange loss involved in this £25 million?
Yes.
This, then, is certainly a change of policy. I raised that question about the exchange loss here. The Minister of State is now stating that the Minister and the Department of Finance will carry any exchange loss as far as this £25 million is concerned. Is that correct?
Yes.
Might I raise one other point. I am somewhat confused here as to whether or not there are restrictions on foreign borrowings. My information is that any foreign borrowings entered into by the ACC must be cleared by the Department of Finance irrespective of their size. That is my knowledge of the situation and I should like that confirmed.
It must be that.
Secondly, might I raise the question of interest rates paid on deposits with the ACC. I asked the Minister a specific question in this regard in the course of my Second Reading speech.
Acting Chairman
The question of interest rates does not arise on this section.
I am sorry, I feel the £600 million and interest rates are very relevant to that issue.
They are. This Bill is here because the £25 million would put the borrowing over the £350 million, and the £25 million is at subsidised interest rates.
Acting Chairman
The Chair's understanding is that this section relates to the borrowing of moneys and does not state anything about interest rates.
Interest rates are very relevant to the borrowings. The control here is exercised by the Department of Finance. It is up to us to try to ascertain exactly what is happening because it is my belief that had the present restrictions not been so tight, more deposits would have flowed into the ACC. They are not in a competitive position at present. I should like that point clarified.
Acting Chairman
The Deputy is widening the debate very considerably.
I asked that specific question of the Minister and he did not answer it—whether any application was made by the ACC in respect of interest rates on deposits. The Minister did not answer that specific question. It is my belief that had those restrictions not been so tight, more money would have flowed in on deposit to the ACC, when they might not have needed foreign borrowings.
Acting Chairman
The Chair has no control over the content of the Minister's reply to Second Stage.
I accept that, but I believe I should be allowed raise it under section 3 of the Bill.
Acting Chairman
We are now on section 2 of the Bill.
On section 2, because it does concern the borrowings of up to £600 million.
Acting Chairman
The section refers solely to authority to borrow, and the question of interest rates does not arise.
Is the Chair ruling me out of order on that?
Acting Chairman
I am, and I would likewise rule the Minister out of order.
(Cavan-Monaghan): Might I direct the attention of the Chair to section 2 (1) which says:
(1) Subject to the approval of the Minister, the Corporation may raise or borrow money (including money in a currency other than the currency of the State) in any manner it thinks fit,...
Surely the conditions of borrowing would come under those words "in any manner it thinks fit"? If that is sufficiently wide to cover the terms and conditions of borrowing, then I would respectfully submit that the question being put by Deputy D'Arcy is very much in order.
Acting Chairman
I fail to see the relevance of the remarks made by the Deputy. It refers solely to an authority rather than to the details.
(Cavan-Monaghan): I do not wish to argue with the Chair. It specifically confers on the corporation a right to borrow in any manner that they think fit. We are entitled to investigate that authority and say where we agree or disagree with it. “In any manner it thinks fit” is wide enough to cover the conditions and terms of borrowing.
Acting Chairman
The Chair does not understand that as extending to include the question of interest rates.
Is the Chair aware of somewhere one can borrow without paying interest?
The most important thing about borrowing is the rate of interest to be paid and who is in control of the rate of interest. We must extract some information from the Minister on this issue because it is terribly important to the debate. The Minister has not given us any information in his reply with regard to the borrowings and the interest payable by the ACC or how much control the Department of Finance have over these interest rates.
Borrowings must be approved by the Minister.
The Minister of State said the opposite a minute ago.
Of course they must be approved by the Minister.
There must be some discussions with the Minister regarding the rates of interest.
I asked if the Department of Finance had any application from the ACC to increase their interest on deposits. I have asked that question three times.
There was a request and the matter is being considered.
When was the request made?
I have not got the details.
The time lapse between the date of the request and the date of the decision is very important. A passage of three to four months between the application and the decision will damage the chances of the ACC in getting deposits.
On the information available to me the request was made and the matter is being considered.
What time has lapsed since the date of the request? This is an issue on which the Department of Finance could drag their feet.
It is a matter of internal administration.
It is not internal.
According to my way of thinking it is not. The Department of Finance can drag their feet on this issue, thus putting the ACC at a disadvantage with regard to other money lending institutions. This is the kernel of the problem as far as the ACC are concerned.
It is a very complex question.
That is not the answer.
It is very complex and involves quite a lot. The Minister has every right to give full consideration to the request of the ACC in this matter. Every Deputy must know the implications in this.
We all know the implications. The ACC should be given the same advantage as every other moneylending institution. In fact the Minister would do no harm to give them a slight advantage in this. At the moment they are quoting at a figure of 11 per cent which is a disadvantage. The banks are quoting from 11 per cent to 13½ per cent, the building societies are quoting higher prices than the ACC. The ACC are at a disadvantage. The Minister said that an application has been made but has not been dealt with by the Department of Finance.
I did not say that.
The Minister said it was under consideration, so to my mind it has not yet been dealt with.
I did not say that. The request was made and the matter is being considered by the Minister for Finance. This is a very complex question and the Minister is only right to give consideration to this before a decision is made.
The Minister of State would clear my mind if he told me what time lapse there has been since the application was made, and how long it has been considered. It could be considered for a year if it suited the Minister for Finance. As far as the ACC are concerned the disadvantage they are at in relation to deposits showed its head in July and we are now into November. It is easy to understand why there is a flow of deposits from the ACC. I would appeal to the Minister of State to ask the Minister for Finance to deal with this question immediately. We are entitled to have the answer to this question. We are there to protect the ACC whereas the Minister for Finance has shown that he has no commitment to agriculture.
That is not right.
I support Deputy D'Arcy. Because of the decline in the flow of deposits to the ACC their lendings to farmers this year are no greater than they were last year, whereas other credit institutions have increased to a limit of at least 18 per cent on their lendings to the various sectors for which they were responsible last year. After all the ACC will have to pay the interest and if the judgment of the board is that they should increase their rate, the Minister should take it as the judgment of competent people who have to bear the cost.
The Minister said something very contradictory in answer to my last contribution. The Minister said that the only limit was the limit of £600 million contained in this section on the borrowings of the ACC, then in answer to subsequent questions he said that the Minister controlled the borrowings of the ACC, and he said at another time that there were constant consultations between the Minister and the ACC, which is an intermediate position between not controlling them and controlling them. We have three possible answers to one question, which is, to say the least, confusing and not something that one would expect of a Minister in charge of getting this legislation through the House, which is still a responsible legislature. If the Minister is worthy of the name of Minister he should be able to answer, a question in a consistent fashion. If the Minister of State is unable to answer, the Minister for Finance should be here. I am disappointed that the Minister of State has not been able to give a clear answer to a straight question on this issue.
Perhaps the answer is that although the Minister does not control the borrowings he controls the giving of state guarantees in respect of borrowings undertaken, so that technically he does not control the borrowings but any borrowings undertaken have the benefit of a guarantee from the State. When the guarantee is given the Minister has a final and absolute control on the borrowing. The Minister is obliged by law to lay before this House a detailed statement of the guarantees given by the Minister in respect of ACC borrowings. All we get in the House is a global statement of the amounts guaranteed, which does not coincide in full with the requirements of the Act, but that is another issue. The answer to the question may be that while the Minister does not control the borrowings he controls the guarantees in respect of the borrowings, which gives him effective control. If that is the answer the Minister should have been able to give it himself, and it should not have come from the Opposition.
Acting Chairman
The question of guarantees arises in another subsection and we can come back to it again. I am calling Deputy T.J. Fitzpatrick.
Could I have an answer from the Minister?
They must get the Minister's approval for borrowings.
Every borrowing?
They must get the Minister's approval for borrowing. There is no point in trying to twist it.
(Cavan-Monaghan): I rise to support Deputy Bruton. On the Order of Business this morning I complained about the manner in which this Bill was brought before the House. I complained that we were requested to give the Bill after a short debate as the money is badly needed and it cannot be delayed. We agreed to that.
We have had the Bill since Tuesday.
We are dealing with £250 million.
(Cavan-Monaghan): We agreed to give all Stages today once the Second Stage was completed.
That is important.
There was no specific time.
(Cavan-Monaghan): The least we might have expected in return was that the Minister for Finance would come in here and deal with the Committee Stage. I am not saying that in any patronising way. I have sympathy for the Minister of State who has been sent in to deal with this Bill section by section, which is outside his office, which is the Office of Public Works. The absurdity of the debate has become apparent. In the early stages of the debate on the section the Minister told us clearly that the approval of the Minister for Finance for borrowing was not necessary in every case. In another intervention he told us equally clearly, and with apparent conviction, that the approval of the Minister is necessary in every case. I agree with that, because the section we are dealing with says that subject to the approval of the Minister the corporation may raise or borrow up to £600 million.
If the Minister's approval is necessary to borrow, he may consider the conditions under which money is borrowed. One of the conditions is the rate of interest which may be charged. Deputy D'Arcy's worry is that the Minister is restricting the corporation with regard to the interest they may pay and, as a result, they are becoming short of money and, as a result, the farmers are suffering. We understand that, in fact, the Minister has refused to allow the corporation to increase their borrowing rates. He has not stated that but he has adopted the usual ploy of the Minister for Finance by refusing to answer questions, refusing to give them the necessary authority and putting the matter on the long finger.
That is not good enough, and it is one of the reasons why they have to borrow abroad. Attractive enough rates of interest are not being given at home. I regard the turn which this debate has taken as quite serious. I do not blame the Minister of State, who is a junior Minister in charge of the Office of Public Works. The man who should be here to deal with the Committee Stage of this Bill, which is being given today to facilitate its early passage, is the Minister for Finance. Normally Committee Stage would not be taken for a week and the Minister would have a chance of studying the points made on Second Stage and answering them. It is obvious that the Minister of State is not equipped to answer all the questions which have been asked. I deplore that.
Acting Chairman
The Chair is anxious to avoid repetition.
I answered the questions. Some twisting is being tried to be given to my reply. I have given the answers.
(Cavan-Monaghan): The Minister of State said that approval is necessary and approval is not necessary.
If the Deputy wants to twist my answers——
I cannot allow the Minister to get away with that. I think he made a genuine mistake in the beginning because he did not understand it. It is quite obvious that no Government could allow any State body under their control to borrow freely without the sanction of the Minister. What I set out to establish was whether he gave a blanket approval for a certain amount, or whether each specific borrowing had to be approved by the Minister. The Minister said they could borrow anything they liked. It is quite obvious that could not be the case, but he stuck to that point up to ten minutes ago, and now he has changed completely. We are doing no twisting at all. We are trying to establish the truth about this, as we are entitled to do, and as it is our duty to do. The Minister changed from what he said originally to what he said a few minutes ago.
Let us be honest about this. I gave the answer. Naturally if an institution like the ACC want to borrow big money they will have to discuss the matter with the Minister for Finance, and will have to have his approval. I said that.
(Interruptions.)
I did not interrupt anyone during this debate. I want to get the record straight. A number of Deputies were shouting one after the other at that time. I stated that specifically. It is true that a credit institution like the ACC would have to have consultations with the Minister.
And his sanction?
I said that.
The record will show.
If the rate of interest was to be guaranteed by the Minister it would also have to come to the Minister.
For sanction?
Deputy Bruton was shooting up on one side and somebody else on the other side. I want to get the record straight. I gave the correct answer.
The record will show.
The rates of interest are not guaranteed by the Minister.
I said he would have to know the rate of interest.
For which? Foreign borrowings or borrowings at home?
For borrowing.
It should be clearly established that for any foreign borrowings, which are important, the sanction of the Minister is essential irrespective of the size of the borrowing. Is that correct?
Yes.
On the question of the interest rate, which is a different question, it is news to me that the Minister is guaranteeing the interest rates on the foreign borrowing of his £25 million. Is that correct?
Correct.
This is a new step so far as the Department of Finance are concerned. Is this something new?
He is guaranteeing the exchange loss.
That would be related to the interest of course. Is the borrowing of £25 million——
The exchange loss.
Is the interest at a static rate or a fluctuating rate on the £25 million?
The terms are still being negotiated.
Sir, the previous occupant of the Chair said we could raise the guarantee about the exchange rate on section 3 only. Deputy D'Arcy referred to it and was answered by the Minister on section 2. May we pursue that now or will we wait for section 3?
I suggest that the Deputy wait until we reach section 3.
(Cavan-Monaghan): That is one way of making progress.
Question put and agreed to.
SECTION 3.
Question proposed: "That section 3 stand part of the Bill."
Can the Minister say whether the Government are accepting the exchange rate risks in regard to this £25 million and, if so, whether they have guaranteed the ACC to this effect?
That is the position.
In reply to the Second Reading debate the Minister referred to the questions that had been put to him regarding the subsidisation of various aspects of agriculture. Deputy Callanan suggested that there should be subsidisation in respect of the erection of sheds, for instance, while Deputy D'Arcy suggested that subsidisation might be used in order to make up the losses that farmers are experiencing in regard to cattle. I made the same point and referred also to the poultry industry which is in a very serious situation. We have been told that neither the Minister for Finance nor the Minister for Agriculture could agree to such subsidisation because to do so would be in breach of EEC regulations. However, to accept exchange rate loss risks is a form of subsidisation. Therefore, if the Government can engage in this activity for the ACC, I fail to see why they cannot subsidise interest rates also. Consequently, the Minister should reconsider the answers he gave in this connection in replying to the Second Stage debate and say that he will agree now to subsidise interest rates but in a limited number of cases and where there is obvious hardship. The Minister for Agriculture would be in a much better position to recognise such cases than would any of us here.
Deputy Crotty said that it would be to the benefit of the cattle industry if farmers did not have to pay 18 or 19 per cent on the money they borrowed and that if rates were lower farmers would be enabled to keep cattle on the land and that this would have the effect of stopping the fall in cattle prices that producers have been experiencing this year. I fail to see any reason for the Minister not being able to subsidise interest rates in respect of the cattle industry. The same applies to the poultry industry, an industry which, for a number of reasons, cannot compete with the huge foreign-owned enterprises that are taking an interest in the Irish company, in one case to the extent of 50 per cent. That is in one of the biggest of the Irish companies. These outside enterprises have almost virtual control of egg production in the six counties and are sending the eggs down here at the expense of our producers. Irish egg producers will not be able to continue in business after Christmas unless immediate and drastic action is taken to help them in regard to the protection of their interests.
This is an area, too, where the Minister can help. It is not sufficient to say that he is prevented from subsidising interest rates because of EEC rules now that he has let it be known that the Government have guaranteed exchequer rate risks in regard to money borrowed abroad by the ACC. The same can be done in regard to interest rates. For instance, in respect of a rate of 17 per cent, the borrower could pay 10 per cent and the Department could pay the remaining 7 per cent. It is not good enough to hide behind technicalities of this kind. It would appear that no other country in Europe is as much tied up in red tape as we have been for the past two years. Recently I heard the Minister for Agriculture described as being the most unreasonable man in Ireland when in Ireland but the most reasonable man when abroad arguing with fellow Ministers for Agriculture when he has no difficulty in seeing the point of view of his British, Italian or French counterparts, whereas he is not able to see the point of view of the agricultural industry at home. Unless some urgent action is taken in regard to this industry, serious damage will be done to the economy as a whole.
As I said at the outset, the question of interest rates is being considered by the Minister for Finance and the Central Bank, but this whole issue is very complex, as I am sure Deputy Barry, being a businessman, will appreciate.
We had this sort of subsidisation before in respect of the brucellosis and TB eradication schemes.
As a businessman, the Deputy must be aware of what is involved.
Not as a businessman on the scale of what we are talking about here. However, if the Minister is saying that I know the value of a pound, I will agree.
We are going into a broad field.
What is involved is a simple calculation. If somebody can prove that he is in genuine difficulty and needs to borrow £5,000 from the ACC at the current commercial rate of 17 per cent, he could be subsidised by having to pay only 10 per cent interest with the Government subsidising him to the tune of the additional 7 per cent.
The Deputy is talking about a very costly calculation.
I welcome very much the new development whereby the Government are to carry to risk of exchange rate losses. That is a worthwhile development because when there is a shortage of money in the country we have no option but to go elsewhere to borrow. We must realise that membership of the EMS has not improved our position on the foreign money market. Previously the ACC or any other Government organisation, as a result of our linkage with sterling, were in a position to go to the London foreign money market and borrow money overnight at very low interest rates, but the fact that that is no longer possible is a serious loss to us. On many occasions when interest rates were running at up to 14 per cent, we could borrow money overnight in London at 2 or 3 per cent. The change in this situation has created a problem for the ACC. A word of praise is due to the Minister for guaranteeing to carry the exchange rate risks attaching to the borrowing of this £25 million.
The question raised by Deputy Barry in regard to the subsidising of interest rates is very important. I do not think that the Deputy was referring to an across-the-board type of subsidisation in this regard. However, those people whose holdings are uneconomic or who have no hope of being able to buy extra land in order to bring their holdings up to viable standards because of the very high interest rates prevailing, should be helped in this respect by way of the subsidisation of those interest rates. This sort of operation would not cost a huge amount of money because it would relate only to very limited borrowing. We have had such subsidisation before. It is necessary to have it again, and in this instance the people who should be involved are the ACC. With respect to the Department of Finance such an operation would not be one for them. The ACC are doing a specific job in the sphere of agriculture and, consequently, should be under the aegis of the Department of Agriculture. Having said that, but not wishing to sound bitter, I would not wish to see the present incumbent of the office of Minister for Agriculture with that responsibility, having regard to his performance of late.
(Cavan-Monaghan): What Deputy D'Arcy is really saying is that he would not like to see the Government in control of anything.
The Deputy is speaking specifically about the ACC, but if we were to subsidise in one area we would have applications for such facility also in respect of the various other groups. We would have one Deputy making a plea for the farming community in this respect and another making a plea for some other sector.
I am sure the Minister will accept that agriculture is our most important single industry and that the growth in that industry has become static.
I am not denying that.
It is generally accepted that the growth rate in agriculture will be in the region this year of .5 to 1 per cent whereas we have had a much higher growth rate. Obviously, then, something serious has happened to bring about such a setback, but it is in the interest of the economy as a whole that the present trend be reversed immediately. I might remind the Minister that in his party's election manifesto there was a promise to subsidise interest rates for people on uneconomic holdings. We stated that before. We had not got around to it but things were different at that time. Nobody expects subsidisation of interest rates across the board. However, the export of our agricultural produce is important for the nation. If we reduce the £1,100 million of exports the economy will be in serious difficulties.
(Cavan-Monaghan): I do not want to prolong the debate as to whether the Minister said earlier that all borrowing was not subject to approval and that later he said all borrowing is subject to approval. I refer the Minister to the verbatim report of the debate. It makes interesting reading. I do not think it is blurred or interfered with by any interruptions. It is crystal clear that the Minister who should be here is the Minister for Finance. It is not treating the House properly to expect all stages of a Bill like this on short notice and not to come to the House himself.
Deputy Barry raised the matter of the poultry industry. This is very important for my constituency of Cavan-Monaghan. We have an economy that is based on processing agricultural products—pigs and poultry including chickens, ducks and turkeys. The pig industry in Monaghan and Cavan gives valuable employment. In County Monaghan the poultry industry employs about 800 people and, consequently, it is very important. Deputy Barry was quite correct in what he said. The poultry processing industry in County Monaghan is under very heavy pressure from Northern Ireland. People there are engaging in unfair practices in that they are virtually dumping products on the Irish market to the detriment of the industry in County Monaghan.
I am satisfied that under this Bill the Minister and the ACC have the necessary powers. It may be a complex matter but semi-State bodies are there to deal with complex problems and to solve them. It is not good enough to say that subsidising interest would lead to this, that or the other. If there are hundreds of jobs at stake in County Monaghan—I am speaking from memory but I think the number of people employed in the poultry industry in that area is 800—the House will realise that this is a very important matter. It should be tackled by the ACC and the Minister for Finance. We are told they are in close contact with each other practically every day; in fact, I have come to the conclusion that there is a Department of Finance tachograph in the ACC. If that association prevails it is up to the Minister for Finance to find a solution to the problem that exists in County Monaghan in the poultry trade by making cheap money available, by subsidising interest or by some other form of support. The time to prevent redundancies is before closures take place. Deputy Barry has given advance warning about the matter. He has been approached about it and he has the facts and figures.
I make this strong appeal on behalf of poultry producers in Monaghan and Cavan for help from the ACC by way of subsidised interest. It is obvious now that the Minister approves of all loans. I am sure he has the power to authorise the ACC to make loans available at subsidised rates of interest. I am asking him to do that instead of leaving it to Fóir Teoranta, the rescue body under the aegis of the Department of Industry, Commerce and Energy, which usually comes into the picture when the cause is lost. If the Minister for Finance and the ACC assist the poultry industry in Monaghan it will not be necessary for later fire brigade action by the Minister for Industry, Commerce and Energy.
That is a matter for the Minister for Agriculture and I cannot answer a question on his behalf.
The subsidising of interest rates is not a matter for the Department of Agriculture.
(Cavan-Monaghan): I appeal to the Minister to be fair to himself and to the House. We know the man who has control of the ACC is the Minister for Finance. That is why his Minister of State is here. The Minister for Finance fixes the rates at which the ACC can borrow and I am sure he fixes the rates at which they can lend. He has wide powers that have been exercised before to subsidise interest rates and that is what I am asking him to do.
I answered the question about subsidising interest rates.
Unsatisfactorily.
It is difficult to establish clearly the position having regard to the contradictory statements made earlier on section 2. I understood the Minister to say fairly clearly that the reason the Minister for Finance had been asked to sanction the £25 million loan was that he was undertaking to guarantee a possible exchange loss. Is that correct?
I have answered that question.
I wondered if the Minister was going to give the same answer now.
I have answered the question. It is wrong to rehash the whole thing over again. I have answered a number of questions that Deputies put to me and I think I have been very fair with them. I am not saying anything further.
This is the first contribution I have made on Committee Stage. The Minister should have answered my question because it was in relation to a further point. The Minister of State said that the Minister for Finance had underwritten an exchange loss guarantee in relation to this loan, but it appears now that the terms are still under negotiation. I want to know in what currency the loan is being borrowed. Further, I should like the Minister to inform the House—and this has far-reaching implications for the ACC and other public bodies—whether we may take it that because of the guarantee of the Minister for Finance to underwrite any exchange loss, any further overseas borrowing by the ACC or by any other State body will contain a similar exchange loss guarantee.
My earlier reply about borrowings may have been misunderstood. I want to tell the House that the Minister does not have to approve every penny borrowed but he approves of every block of borrowing transactions. It is possible that that is where the misunderstanding between us arose.
My remarks about the confusion were justified because the Minister of State is no saying that the Minister does and has to guaranty all borrowings. Deputy Barry asked him in the course of debate on section 2 if the ACC make their own arrangements to borrow up to certain ceilings or if the arrange a loan on the continent and the seek the sanction of the Minister. The Minister of State replied that the only time the Minister gives a sanction when there is a specific big borrowing from outside the country. Now, 45 minutes later, the Minister of State is telling us that the sanction of the Minister is required in all cases. Perhaps the House now appreciates a little more the reason for the confusion. The Minister caused some confusion by telling the House 4 minutes ago——
I clarified the position. There was a lot of talk at the time and a number of Deputies were shouting at me.
It did not appear to give the official reporter much difficulty, because the record is clear on that matter. The Minister of State has now confirmed that the sanction of the Minister for Finance is required in respect of all borrowings but he has not given an answer to the important question I asked. The Minister for Finance has undertaken exchange loss guarantee in relation to the loan of £25 million, and correctly so, but, as we are discussing further authorisation to the ACC to borrow up to a certain sum, I should like to know if we can take it that the Minister for Finance will guarantee exchange loss in relation to any further overseas borrowings by the ACC? Can we take it that if other public bodies are to borrow abroad they will also be given a similar exchange loss guarantee by the Department of Finance?
I want to be fair to the Deputy. There is no commitment as to what the Minister will do in that respect in future.
In respect of the £25 million loan there is an exchange loss guarantee but we are not to take from that that a precedent is being established for further exchange loss guarantees in relation to other public capital borrowings abroad?
I cannot do that. There is no commitment for the future.
This is an integral part of the discussion on the Bill, which seeks to allow the ACC to borrow up to a certain limit. Some of those further borrowings almost certainly will be on the foreign money market, and the question of whether the Department of Finance will take up the very real problem in regard to exchange loss on those borrowings is an important aspect of the discussions.
We will have to answer for each case as it arises. We must be honest about this matter. I should like to know if it is the policy of Fine Gael to hold up the progress of this Bill?
The Minister of State is aware that that is not so. I gave my word on that.
Words are being twisted and misinterpreted.
That is not true.
Bring in the Minister who should be answering and we will get replies to our questions.
Every Opposition Deputy who contributed to the debate on this Bill spent a lot of time discussing matters relevant to the Department of Agriculture and other Departments rather than confining their remarks to the provisions of the Bill. I sat for hours listening to the debate and, in replying, I tried to be fair to Deputies who asked for information in relation to the Bill. I cannot answer questions relating to agriculture or lands. The Leas-Cheann Comhairle on many occasions had to remind Deputies that they were dealing with questions of agriculture and land rather than the provisions of the Bill. I did not interrupt Deputies even though I was aware that their remarks were not related to the Bill. Now, Fine Gael, after they had agreed to give us the Bill, are holding it up on a technicality, on confusion about something that was misinterpreted. I have clarified that matter and answered all the question that were put to me.
The Minister for Finance is not hiding behind anything. He has the interests of the farming community at heart. The introduction of the Bill is a gesture by the Government to the farming community. If the Fine Gael Party want to hold up the granting of permission to the ACC to borrow this £25 million they should tell that to the farming community. They should tell the farmers that they have spent three days discussing this. It is difficult for one to keep one's patience in relation to this. This is a disgrace. Opposition Deputies talk about gloom but I have not heard the farming community pleading gloom.
(Cavan-Monaghan): One would think that cattle prices went up by 50 per cent, according to an advertisement?
I am sure farmers will be disappointed at the Fine Gael approach to the Bill. They have done everything to prevent it being passed so that this money can be made available to them.
At the outset of my contribution on Second Stage I told the Minister that after the contributions on that Stage we would give him the other Stages immediately. That is still the position. When Second Stage completed one hour ago we could have asked that Committee Stage be taken next Tuesday, which is the normal thing to do. The histrionics displayed by the Minister of State a few moments ago do not impress me. That is not a matter for the Minister of State; it is a matter for the Chair. I accept that the Leas-Cheann Comhairle corrected some speakers whom he felt were wandering outside the scope of the Bill, but for the last hour we have been endeavouring to get information on matters of finance from the Minister of State. That is our duty and we are entitled to that information. If we are to remain here until five o'clock we will get the information which we feel it is the right of Members to have on the record. Any blustering, shouting, attempting to bully or blackmail by the Minister of State by saying that Fine Gael are trying to hold up the farming development of the country does not impress us. It is the Minister's job to give Members information in relation to Second Stage. We will remain here for as long as necessary—if necessary we will move before 3 p.m. that the House sits late because we gave our word that the Bill would pass today—to finish the Bill in the interest of the Government and the farmers. However, we are not going to allow legislation through without examining it in detail. Deputy Boland put two questions to the Minister. The Minister answered one and, out of courtesy to Deputy Boland, he should answer the second. Deputy Boland has the same rights here as the Minister of State.
I answered all questions put to me. There was a misunderstanding about one aspect but I clarified that. I do not know what else is expected of me.
My question still stands in relation to any further borrowing that the ACC may be authorised to carry out on foot of the passage of this Bill. Would the Minister for Finance give the same exchange loss guarantee as he has, apparently, given in respect of the £25 million loan currently being negotiated?
That is not an agricultural question.
I thought I had answered that question. I cannot guarantee any future commitment by the Department of Finance on future borrowings. I cannot commit the Minister to this. Fair is fair.
This is a financial measure introduced by the Department of Finance. The only questions I asked relate to financial matters, contrary to the Minister's suggestion that every Deputy who spoke spoke on other topics and other Departments. If the House is to be asked to pass this Bill and are told that the Minister has now given a guarantee in relation to large overseas borrowing, and if the House cannot be told whether a similar guarantee will be given by the Department of Finance in relation to any further borrowings which the ACC may make under this Bill, it leaves Deputies disadvantaged in establishing just how costly the ACC overseas borrowings may be and also in establishing in relation to other State bodies who may be borrowing abroad in the future if that similar guarantee will be given to them in respect of exchange law. I am surprised, in relation to a Bill of this nature that the Minister of State is unable to inform the House what is the Department's and his Minister's policy is in relation to that important aspect of overseas borrowing.
I am sure everybody appreciates that future borrowing is something which will have to be discussed. Events change and I could not commit the Minister for Finance and his Department in relation to this. I cannot guarantee that in relation to future borrowing by the Department of Finance or the ACC.
The Minister may be able to reply to another question I asked. I asked about the currency in which the present loan is being negotiated.
Some will be Deutsche Marks, and we are not sure about others.
Will they all be in EMS currencies?
Yes.
Could we have some indication of what will be the approximate rate of interest for the foreign borrowing of the £25 million?
The terms are still being negotiated.
We should have some indication. We know that the rate of interest in Germany is around 7 per cent to 9 per cent and there are variations between the interest rates there and in Ireland. Have we no indication of what the rate of interest will be? I understand that some of the negotiations are almost complete.
They are not fully completed.
We will have to put down a question to the Minister for Finance.
By all means.
Question put and agreed to.
Section 4 agreed to.
Title agreed to.
Bill reported without amendment.
I move: "That the Bill do now pass."
(Cavan-Monaghan): Before the Bill leaves the House I should like to say a few words on it. This party agreed to facilitate the passage of this Bill through the House. Deputy Peter Barry undertook to take all Stages immediately after the Second Stage was disposed of, and we are doing that. That did not mean that we agreed to allow this Bill to go through the House without proper debate or without proper investigation. This Bill authorises an increase in the borrowing powers of the ACC from £350 million to £600 million. The money that is borrowed will be lent to farmers. Surely this side of the House are entitled to discuss agriculture under this Bill, because the additional £250 million which the ACC are being authorised to borrow will be lent to farmers. The House would be in great dereliction of its duty if it did not express its views about the various sectors of agriculture in need of more capital and if they did not advise the ACC and the Minister how that money should be lent, to what sectors of the agricultural community it should be lent, and if it did not discuss in general under this Bill agriculture and agricultural policies.
It is very hard to remain here listening to the Minister of State at the Department of Finance complaining bitterly because agriculture was discussed under the Bill. I do not care what Minister should be here, but we would not be doing our duty if we did not have that sort of discussion. I make no apologies to the Minister for contributing to that debate. If a similar Bill was introduced next year, I would also contribute to it on the same lines if I am on this side of the House, which is not at all certain. The Minister may not like a debate on agriculture as he is a city man and is perhaps not very familiar with it.
We spent the morning dealing with the technicalities of the financial provisions of the Bill. Surely that was in order? The Minister seemed to resent that. He seemed to think we were probing too deeply into it, that too many people were asking questions. This morning was taken up, with the exception of the brief flight into poultry, with the technicalities of the Bill in regard to borrowing. I make no apologies for asking questions about whether or not the Minister's approval is necessary for borrowing. I believe that the points raised by the other Deputies were also very relevant and close to the sections.
The Government should either order their business in such a way that there can be an ordinary debate on the various Stages of Bills—that when the Second Stage is dealt with the Committee Stage is taken a week or two afterwards—or keep their cap on when they come in and ask to be facilitated by the quick passage of Bills through the House and ask that the Committee Stage and subsequent Stages be taken on the same day as the Second Stage. When that facility is afforded to the Government it means that the Minister may not be as well briefed as he should be, but he should certainly not become aggressive and accuse the Opposition of being obstructive when they are facilitating the passage of the Bill through the House.
I would not want to be misinterpreted. I welcome question on this matter. Some Deputies suggested that we should not come back to the House to raise the statutory limit of borrowing and I said in my reply that it gave Deputies an opportunity to raise questions on this and on the working of the ACC and that it might be a bad day's work if that ceased. That alone gave an indication of my willingness to receive any queries. It indicates my willingness to help Deputies on all aspects of the workings of the ACC. It was wrong of the Deputy to misinterpret what I said. I always try to help Deputies.
Question put and agreed to.