It is hard to recall any budget that has been received with such universal criticism. Of course, some of this criticism comes from interested parties, and must to that extent be partially discounted. But what is unique on this occasion is the combination of attacks by those directly and adversely affected in particular ways with criticisms by neutral observers concerned only for the economy and for truth.
Today's business page headlines in the papers tell their own story. I will read the headlines from one paper. "Fitzgerald adds to cost burden of industry", "Further pressure applied to company liquidity", "Omissions will seriously damage corporate sector", "Expansionist budget will worsen balance of payments deficit", "Gilts need new direction, not a neutral budget", "Six long years of borrowing", "State borrowing target unlikely to be accurate", "Figures show financial disorder". Those are the headlines in one newspaper on the business pages, the assessment of people who have no vested interest in particular benefits, but who are there to comment impartially, on what the Minister said in his speech for an hour and three quarters yesterday. Perhaps, in present circumstances, a budget that would have pleased the different interests in the community would have been bound to attract adverse comment from concerned and objective observers. Equally, a budget that pleased those concerned with our economic fortunes, might have been expected to have aroused hostility amongst different groups whose interests would have been hit by measures designed to get our finances in order. But to manage to please nobody has required a unique kind of blundering which only a Government that had totally lost its nerve, and its sense of judgment, could be expected to engage in.
The farming community are, justifiably in my view, incensed that so little attention has been paid to their plight. If their income were to have retained in 1981 its 1978 purchasing power it would need to have been of the order of £1,450 million. In fact farmers' income this year is now estimated by the Economic and Social Research Institute at £815 million, a shortfall of no less than £635 million or 45 per cent. Of course one has to face the fact that no Government could attempt to effect a transfer of income of anything like this order of magnitude between different sections of the community. It was inevitable that, under present circumstances, farmers should suffer some loss of income, have to tighten their belts and any politician who told them otherwise would be misleading them grossly. But equally any Government concerned not alone with the hardship that important groups are at present suffering but also with the survival and future development of the agricultural industry in Ireland would have made a serious attempt to alleviate these difficulties in ways that would help to halt the destruction of our breeding hered and the erosion of the productive capacity of our land.
Fine Gael put forward a package of measures with this in mind. It is not, of course, the only possible package of such measures; one could think of others, but it was designed as a serious contribution towards alleviating the problem. The Government, bereft of any ideas of their own, and clearly still quite incapable of grasping the seriousness of the farming crisis, have contented themselves with taking several of these proposals and implementing each of them only partially. The abolition of rates which we proposed becomes an alleviation of rates. The abolition of bovine TB eradication levies becomes a temporary remission of these for this year. Our stock relief proposal is turned into something different and much less valuable in terms of operating as an incentive to retain the breeding herd.
As for our other three proposals, the Government have ignored these altogether. Thus the resource tax for 1980, of which £250,000 only was actually paid during that year, has not been remitted as we proposed. Stamp duty relief to apply for three years to transfers of land to younger farmers, which would have cost virtually nothing in loss of duty as so few such transfers at present occur and which could have been an important incentive to such transfers, is ignored as is the vitally important proposal for interest relief. All these are equally swept to one side. The last, I think, is of great importance. I must say I am extremely surprised that the Government should have omitted any reference to it or any attempt to assist in this particular area where the dangers are so great for farmers who are now at risk in regard to holding on to their farms.
When one sees in the papers news of farmers being forced to sell out in specific cases one can see how grave is the situation. What is interesting is that, in all this, the Government have not a single idea of their own to contribute as to what might be done to help farmers in their plight. All they have done is take three of our six, emasculate them, and ingore the other three. The only thing they have produced on their own account is an announcement their they do not intend to abolish the two tax payment dates and to revet to a single payment date. I doubt if a single farmer was aware that it had ever been proposed to revert to the single date, and the idea that by not doing so they are being given £5 million by the Government is not likely to impress them. The Government might as well have told them they were giving them £100 million or £200 million by not taxing them this much extra. It looks as if the Government themselves are simply not prepared to face the farm crisis but are content to hope that Brussels will bail out the Irish farmers. I doubt if Brussels will be much impressed. Brussels is more likely, like God, to help those who show some sings of helping themselves within the EEC rules, as it is open to our Government to do and as the French Government, for example, have been doing. If the Irish Government so clearly believe that Irish farmers need no serious help why should Brussels bother with this problem? Yet that is precisely the atmosphere that has been created by the Government by their inaction. The danger is now great that any attempt by the Minister, Deputy MacSharry to impress the new Commissioner, Poul Dalsager, will fail because his answer will be simple: if you really think your farmers are in trouble why have you done nothing about it yourselves within your own limits, within what is open to you and possible for you without breaking EEC rules? There is no answer to that if it is put to the Minister by the Commissioner.
I turn now to the PAYE sector. Their claims to greater equity have been swept aside with contempt. For the second year running after a 37 per cent rise in the cost of living in these two years, there is to be no increase whatever in the Personal Allowances. This fact was last year masked to a degree for the PAYE taxpayer by the introduction for the first time of the special PAYE allowance, and relatively little comment, therefore, was directed last year to the failure to increase the Personal Allowance. For the second year running they have been left where they were despite the fact that the cost of living has increased by three-eighths in that period. Moreover one only of the tax bands is to be adjusted to allow for inflation. This helps only married couples with more than £12,800 a year, or single people with over £6,700. They represent a fairly small minority, of taxpayers. The vast majority, something of the order of 85 per cent, 90 per cent at a guess — I have not had time to do the calculations — are given no assistance. The rest can throw their hats at any element of indexation relief this year. What is the effect of this? Tax savings of £50, to £70 for married taxpayers with children between approximately £4,500 and £10,000 a year, with no savings at all for married couples without children in the commonest income range of £3,000 to £6,000 annually. Incidentally as the indirect tax increases in the budget involve at the very least a 2 per cent increase in the cost of living — and I am putting it at its lowest; I think it would come out nearer to 3 per cent, but taking it even at 2 per cent — even the taxpayers who save £50 to £70 will all be worse off. Thus a married man with children earning say, £7,000 a year will save £70 in income tax but he will have to pay at least £140 more in indirect taxes, losting a net £70 on the deal. This is certainly treating the PAYE taxpayers with contempt, they know it and they have already shown that they know it. At a time when we need greater national cohesion the Government have thus incensed both of the two main groups of taxpayers.
I come now to the business sector. At the same time as the Government have acted in this divisive way they have inflicted a penal blow on businesses. After much toing and froing between the CII and Government — well publicised by the latter — all that has emerged is that businessmen must, in 1981, pay one and a half year's tax within a single year to bolster up the faltering finances of the State for this single year. The impact on the liquidity of many firms already in difficulties can readily be imagined. When they had, not unreasonably, been seeking some relief — even if they probably knew in their hearts that they could not get much relief in such a difficult year — they must be fairly sore at what represents a total incomprehension of their problems on the part of the Government.
What return do all these measures yield apart from disillusionment in so many important sectors of the community? What great progress has all this yielded towards the goal, extolled by the Taoiseach and his Ministers earlier this year, even as recently as August last — as I shall have occasion to point out in a few moments — of financial stability? How much nearer are we to reducing borrowing from last year's 14½ per cent of national output? How much nearer are we to reducing the massive deficit in the current budget? After all this tranuma we are precisely nowhere in respect of these two crucial issues. Borrowing is actually higher at 15 per cent. Do not let us be fooled by this talk of privatisation, on which I want to dwell for a few moments because there has been a lot of deliberate obfuscation of this issue and I, think we ought to try and get to the truth of it. I am not against provatisation. Indeed in the adjournment debate last year, in a speech prepared and made available to the Press before I had seen the Taoiseach's own speech on the matter, I incorporated the same idea. Obviously there are some advantages in seeking private financial participation in projects that have hitherto been financed solely by the State.
I would favour — and this is true of my party — the involvement of the private sector on a minority basis in public enterprises. Private entrepreneurship might bring new skills to bear on the problems facing some of these bodies, and the raising of future capital in partnership between the private and public sectors could offer an assurance against the State bodies getting preferential treatment with respect to capital. This would thus remove the only valid inhibition to their being allowed to compete freely with private firms in the domestic market because one of the things that, ever since the days when Séan Lemass as Taoiseach tried to make these companies and indeed Government Departments into development corporations, has held up progress in this respect is the inhibitions that exist in the public sector on competition with the private sector for the reason that the private sector holds that the public sector gets its capital not only easily but often literally free and that therefore competition between a public firm and a private firm would be unfair. That is a fair point and it must be taken into account. But if in fact the public firms were to raise their capital on the market through rights issues in which the subscription by the Government were to be determined by the amount that the minority private interests were prepared to put up then because their capital was raised in the same way that argument against free competition would disappear. This country could do with free competition between public and private enterprise on fair and equal terms. It could do with the release of the entrepreneurship that exists in these bodies of which I had personal experience in the first 12 years of my working life in Aer Lingus and which, despite the strictures on them from the opposite benches, some of which in one or two cases are certainly deserved, nonetheless contain considerable capacity for entrepreneurship which could be released in this way.
But private shareholding in State companies is one thing, and the kind of privatisation now proposed by a Government desperate to appear to reduce their rate of borrowing is quite another. Let us analyse in a little detail what this idea, as now being put forward by Fianna Fáil involves.
First of all, as one powerful repressentative of the private sector said yesterday, this sector will not be content to get involved in providing capital through privatisation merely on a basis of getting the same return as from gilts — at present just over 16 per cent. So the capital to be provided in place of fixed interest bearing stock, which is no longer to be described as borrowing, is apparently going to cost us, the taxpayers, more than straight borrowing. I see what the private sector gets out of this, but I do not see what the taxpayer gets out of it, except for the dubious privilege of paying more for the money needed to finance public services. This point needs to be answered and I hope it will be in the debate before we proceed any further along this path.
A second new form of privatisation is the extension of the privilege of an initial allowance of 50 per cent for investment in industrial buildings to industrial buildings leased to a State-sponsored industrial promotion agency, such as the IDA which then sub-leases them to individual companies. Here the private investor, who at present is given this initial allowance to encourage him to take the risks involved in investing in industrial buildings that may or may not be let, and let profitably, is to be given the same benefit in relation to a totally secure investment with the IDA. This seems to go well beyond what is necessary in order to get private interests to take over part or all of the industrial building programme — something, incidentally, which I am very keen to see happening, as I regard it as a waste of State capital to have it invested by the IDA in buildings instead of on grants, when these buildings could be provided by the private sector — but perhaps on somewhat less generous terms than are now proposed. The last report I looked at involved the diversion of £43 million into buildings which could have been financed by the private sector.
A third example of privatisation carried to extreme lengths is the proposed new special allowance of 100 per cent in respect of expenditure commenced after 28 January on the construction of moderate-cost rented residential accommodation, with consideration also for an appropriate incentive to involve the private sector in the provision of multi-storey car parks and toll roads and bridges. The idea involved here is excellent, and I support it in principle. But let us reflect on just what the Government are offering. They are saying to a man who builds a block of flats, or a group of houses for rental, costing, say, £30,000 each, and rented at say, £3,000 each, that he can receive this rent free of all tax for a period of ten years. Do we really need to go so far to get people to make this kind of investment?
Is this, and some of the other privatisation proposals, not very reminiscent of the 20-year tax remission on mining profits accorded, if I remember correctly, by the present Taoiseach as Minister for Finance to mining companies, at a time when they would have settled happily — as director's of one of the world's largest mining concerns told me themselves in the Shelbourne ten years or so ago — for a five-year remission? They got four times as much as they expected.
We, in Government, had to go through the unpleasant experience of revoking that grossly over-generous concession, at some cost to our credit as a country, because the concession was totally unjustified. I do not want to find myself in the same position again. I believe that this House should look very carefully and closely indeed at any privatisation proposals put forward by this Government on terms that appear unduly generous and, when the time comes, if the Government force through with their majority proposals which seem to us contrary to the interests of the taxpayers of this country, this party will have to decide whether we may not have to serve notice on those concerned that these concessions might have to be revoked in favour of equitable and adequate incentives when the Government changes.
I merely mention this by way of preliminary warning at this stage because I feel it is essential that a full and informed discussion takes place on this whole question of privatisation before we launch into selling off parts of the public domain at a bargain price, just in order to be able to claim on the face of it a nominal reduction in what would remain a grossly excessive level of Government borrowing, or fund-raising of one kind or another.
The budget presents borrowing net of these presumed contributions from the private sector through other channels and in other forms. The capital programme is more honest in stating in the main text the full sum to be raised "from other Exchequer sources", and adding in a footnote the fact that this total includes the £200 million to be provided, hopefully, as a result of these privatisation measures.
Even this, of course, is not entirely honest, because when one reads the text of the capital programme one finds that this proposal is still at the stage where there are no commitments, so that it is not possible at this stage to make specific deductions from borrowing for particular investments in respect of private sector funded projects. Today's papers tell us that in fact only £40 million to £50 million is likely to be available from the private sector. If this is correct — and it is said with some authority by commentators who are well informed—then quite apart from the merits of the privatisation proposals the likelihood of their contributing £200 million is limited and we have to look for another £150 million borrowing over and above that to which the Government are admitting.
So we must face the fact that no real reduction in borrowing has been achieved, and that the sums the Government have to raise to finance their capital programme represent a percentage of GNP not far off twice the 8 per cent target of the Fianna Fáil manifesto.
I want to turn now to the current budget outturn. There was remarkable fiddling of figures yesterday which left many people under the delusion that there was a reduction in this budget in the current budget deficit by comparison both with that of last year and that projected in the Estimates of receipts and expenditure. I want to show that this is fallacious and a piece of financial juggling like so much else in the budget. At the end of all the steps that have been referred to earlier, which increase the total tax burden on the ordinary income earner, which give the farmers nothing of any substance to help them with their problems and which require businessmen to pay one-and-a-half years' tax in one year, the current deficit is apparently — and I stress the word "apparently"— reduced from last years' £547 million to £515 million, a reduction of £31 million or 5½ per cent.
But this is not the full picture. It is the picture for the calendar year 1981. To get the true picture we must look to see what the effects of this budget would be, in a full year. Let me list the additional costs, or revenue losses, involved in a full year as against the calendar year 1981. If my estimates are incorrect, no doubt the Taoiseach or some other speaker will put me right in due course. The social welfare increase of £111 million for nine months of 1981 would be £148 million in a full year, an increase of £37 million. The income tax concessions of £61 million would cost £91 million in a full year — an extra £30 million. The corporation tax additional yield of £66 million is, of course, a once-off benefit, which would not accrue again in a later year. The Post Office arrears of £41 million from 1980 to 1981 — a highly dubious figure in any event, after a year in which expected Post Office arrears of £100 million turned out to be only £33 million is also non-recurrent. Between these four items the 1982 position on current account will be £174 million worse than that shown for 1981.
On the other hand, in fairness it must be said that if the agricultural disease levy were to be restored as the Government appear to threaten, this would yield an extra £9½ million in 1982; indirect taxes would yield an extra £13 million and Post Office charges assuming the new higher charges become effective in May, would yield an extra £15 million in a full year — a total additional revenue in a full year of £37½ million. Thus the net difference between the out-turn of 1981 and of a full year incorporating all the changes proposed in this budget, and no others, would involve a current deficit position £136½ million worse than that shown for 1981 in this budget, namely a current deficit of £651½ million.
It is very important that this fact should be grasped. The budget as presented — whatever about the quality of the prose, or the logic of the structure of its presentation, its arithmetic is ingenious — is designed to give the impression that the Government are getting the current deficit down, not perhaps by much, but by something. In fact it is raising the annual rate of current deficit from £547 million last year to £651½ million in 1982, namely by £104½ million, or by 19 per cent. This means that the current deficit is being raised, and not reduced, to a higher level as a percentage of GNP, which even on the Government's own account will not increase this year by as much as 19 per cent in money terms. I would particularly urge that the media take note of this point which is fundamental to an understanding of this deliberately complex and confusing document.
So much for the general outline of the budget. The speech itself is so shapeless and badly drafted that one is forced to reconstruct this pattern from the disjointed bits and pieces of material it contains. The Minister was displayed on television yesterday claiming personal credit for the document; I wonder if he was wise to do so in view of its exceptional incoherence and its remarkably misleading character.
Already commentators and politicians are speculating as to the reason for such an incoherent and shapeless budget, achieving so little when so much needs to be done. The Government Deputies are as puzzled as anyone else and clearly do not relish having to take it back to their constituencies tonight to explain it to their Cumainn. They know they cannot sell it as offering any goodies that any reasonably intelligent person could conceive to be so; nor can they make any claim that it is a step towards putting right the mess into which our public finances have been falling after three-and-a-half years of Fianna Fáil rule. They are, as we saw last night, a pretty demoralised bunch, all the more so because of the build-up that the Taoiseach's PR team gave to the budget for weeks beforehand, as a weapon with which to win an election.
So far I have taken the budget at its face value. This is being charitable. Clearly it gives something less than a full and true picture of the likely costs of government in the 12 months ahead. Last night on television three independent commentators were asked for their views on this aspect, and while one was somewhat less critical of the budget than the other two, all of them were agreed that expenditure would in the event turn out — as in the past two years — well ahead of the budgeted figures.
In this House yesterday Deputy Bruton ably and entertainingly displayed some of the absurdities of the Book of Estimates — the Departments which were going to stop posting letters and making telephone calls — for example, the Revenue Commissioners, whose activities in this respect are to be cut back by 60 per cent in a year in which those Post Office charges are to be raised by somewhere between 17 per cent and 25 per cent, the other Departments which are going to stop travelling like Foreign Affairs whose travel vote is cut by £600,000 or almost 30 per cent in a year when travel costs will certainly rise by 15 per cent. Deputy Bruton, also referred to the remarkable economies in Naval and Army stores that are envisaged. One is left to wonder how many Army vehicles, Naval vessels and Air Corps aircraft will still be operational on 31 December next if all these cuts involving reductions of over two thirds are actually made.
There are many other oddities in these Estimates to be teased out in due course — the two-thirds cut projected in compensation for malicious injuries, referred to also by Deputy Bruton, and the 30 per cent reduction in spending on farm modernisation schemes — one must hope for the country's sake that this is a misleading figure and that the Government do not seriously contemplate such a reduction in this area — the halving of support for agricultural schools and farms; the remarkably optimistic and totally unexplained assumption that CIE's losses will fall by £5 million, and the halving of grants for harbours.
Then there are the extraordinary increases upon which the Government are counting, in appropriations-in-aid — revenue accuring to Departments from remunerative activities of one kind or another. These are often overlooked in the Book of Estimates. In eight Departments alone — excluding the special case of the Post Office — increases in revenue of this kind are calculated at £46.2 million, a rise of almost 30 per cent, or double the rate of inflation expected. Does this mean that these Departments are going to increase their charges for services by twice as much as the general inflation rate, and just what will this do to the cost of living on top of the open increases in the budget?
These are all questions raised by what must surely be — even including last years's — the oddest and most unconvincing, Book of Estimates ever to come before this House. No wonder one comementator last night expressed the view that the actual outcome of 1981 in terms of current expenditure would be, £115 million more than shown in this remarkable volume of fiction.
It is not only here in this Book of Estimates that we come across non-credible figuring by the Government in their preparations for this budget. Let us look for a moment at the document distributed just before the budget, the "Economic Background to the Budget". This document tells us that although the volume of expenditure by the public authorities on goods and services showed an increase of just 2 per cent over 1979, "expenditure increases significantly, largely because of the cost of pay in the public sector". How true. This pay increase in 1980 was no less than 35 per cent or almost double the increase in the cost of living. In a year in which the numbers in the public service seem to have risen about 2½ per cent, this means an average increase in pay per capita of about 32½ per cent. With consumer prices up 18½ per cent, this meant an average increse in living standards for public servants of about 12 per cent. By contrast the increase in pay per head in manufacturing in 1980 is estimated by the ESRI at 18 per cent, implying an average drop of ½ per cent in living standards for those working in industry. For farmers, incomes last year were static in current money terms, leaving them with an 18½ per cent drop in living standards, on top of a similar decline in the previous year.
This contrast between the patterns in growth and decline of living standards for those three categories raises questions of equity that cannot indefinitely be ignored especially as there is no sign of any change in this pattern. In their pre—budget estimates, having provided for increases of £225 million or 14½ per cent in public service pay in 1981, which just matches the likely increase in inflation, the Minister then went on in his budget speech, first, to hope, then earnestly ask, public servants to consider seriously in the national interest the pressing of special pay claims on top of the national understanding. Leaving aside the oddity of this language from a member of a body called a Government who are put there to govern, the value of these pleadings is then totally undermined by the announcement to the group who are being asked not to look for more money over and above the national understanding that the Government are setting aside a tidy £80 million extra to pay them the money the Government hope they will not look for.
When one recalls that last year the Government set aside £100 million in not dissimilar circumstances and then paid out £180 million, one cannot be too optimistic that this £80 million provided this year, and more besides, will not be drawn on. If the figure were kept to £80 million this would involve a 19 per cent increase in public service pay, which, with an anticipated increase of 1 per cent in numbers, implies an average rise of 18 per cent per person, that is a 3 per cent increase in average living standards. By contrast, workers in the private sector are apparently expected to abide by the national understanding and to take 13 per cent, involving a drop of 2 per cent in living standards and farmers are forecast, for the third successive year, to have their living standards cut by a further 13 per cent, with a 2 per cent increase in income and a 15 per cent inflation rate.
This disparity, increasing year after year, between the purchasing power of wages of public servants, who have security and pay-related pensions and of other non-agricultural workers, with no security and only very partial and generally not pay-related pensions, and that of farmers, with no security against their farms being taken over tor non-payment of debt and no pensions at all, is difficult to defend and is a growing source of divisions within the community of which we, as politicians, must be aware. I shall pursue the matter no further at this stage but I would not be doing my duty if I did not draw attention to these disparities.
The next point in this document "Economic Background to the Budget" to which I wish to draw attention is its paragraph on the balance of payments. This paragraph states, rather blandly, that the data available implies a net capital inflow of £1.120 million. This sounds rather good on the face of it — people pouring money into the country as a good place to invest. The reality is somewhat different. Just half of this is accounted for by Government borrowing of £564 million. While no figures have been published beyond September for the external borrowings of State bodies, judging by the fact that in the first nine months of the year they had borrowed abroad no less than £307 million — almost two-thirds of all their foreign borrowings since the foundation of the State — it seems likely that the figure for the year as a whole must have been in the region of £400 million, or a total of over £950 million borrowed by the State abroad in one form or another. This leaves no more than £170 million net coming in by other means, including, of course, direct investment in new industries here. This is not such a cheerful picture as appeared at first sight; and it becomes even less cheerful when one realises that, if the Government and the State bodies had not borrowed abroad something in the regions of £950 million, our official external reserves, instead of rising by £370 million from £97 million to £1,345 million would have fallen to a mere £400 million — less than what we would need to cover one months imports.
The simple truth is that our external deficit is now so large and is at present rising rapidly, forecast to rise from £750 million to £900 million this year — I suspect there will be another estimate — that we are forced to borrow abroad on a massive scale, even if there are resources at home for this purpose which could be used at lower cost, just to keep our external reserves from disappearing within 18 months, as they would disappear if we did not borrow abroad and kept the present rate of external deficit. This is quite simply a path towards disaster and we do ourselves no service by hiding the fact.
The next point I want to make about this publication "Economic Background to the Budget" is that it is misleading with respect to the impact of the 1980 Budget indirect tax increases on consumer prices. At the time of the budget it was officially stated that the effect on the consumer price index of the budget indirect tax increase was 3.8 per cent, and, while I contest this figure because I believe that the underweighting of items like petrol in the official index tends to understate the true impact of indirect tax increases on the cost of living, I feel that the Government should at least be consistent with themselves and not try to fob us off in this document with the misleading statement that the effect of the 1980 budget on consumer prices was 3 per cent rather than 3.8 per cent, almost a quarter lower than the figure officially published at the time by the Central Statistics Office.
More serious, however, is what this document has to say about employment during 1980. It estimates that during that year there was little or no change in the 1979 level of employment "an increase in services employment being offset by a decline in agricultural and industrial employment."
It is very difficult to give any credit to this statement. In the national understanding, published only in August last, the Government estimated that the increase in the labour force was 5-10,000 a year. The Economic and Social Research Institute in their current Quarterly Bulletin provide figures indicating a 10,000 increase in the labour force between April 1980 and April 1981, substantially confirming the Government's national understanding statement on this point. If the labour force is rising by 10,000 and unemployment is static, how could unemployment then have risen by 34,000 in the last 12 months? The answer of course is that the statement about there being little or no change in employment in 1980 is quite unsustainable, to use polite language in this House. It is clear that there must have been a fall of over 20,000 in employment in the last 12 months or so. Otherwise, with a 10,000 increase in the labour force, one could not have had a 34,000 increase in unemployment. This is confirmed by the Economic and Social Research Bulletin, which estimates a drop of 21,000 in employment between April 1980 and April 1981, the dates officially used for employment comparisons, rather than calendar years. This involves a drop of 7,000 in industrial employment, and of 11,000 in the number engaged in services, which the Government document claims actually rose in 1980.
There is a limit to the extent to which documents printed and published over the authority of the Government and traditionally subject to scrutiny by the public service that they do not contain gross misstatements of fact — in our time that scrutiny was insisted on and accepted by us — can be allowed to become totally misleading. I can recall, as a Minister, with other Ministers discussing with civil servants this point, employment forecasts and employment estimates and putting the point to the civil servants: did they not think that there was a case that the level of employment in, perhaps, construction, was 1,000 or 2,000 higher than they thought? We argued the case and, when they showed that the optimistic figure I was thinking of was incorrect, we accepted it. We accepted that a figure in a document published on the authority of the Government must have been one which could be stood over, that it represented a view which was solidly based and which the civil servants themselves accepted. In an argument civil servants win, and that is the end of the matter. You do not fake the figure. Has that all changed?
How could a Government document come out talking about an increase in employment in the services sector when it is clear that actually there was a fall of 11,000 in that very sector, offset by 2,000 more being employed in the public sector? I should point out incidentally, that this 21,000 drop in employment in the 12 months ending in April next means that the whole of the gain in employment in industry and in services made between April 1979 and April 1980 will have been lost.
These facts should not be hidden by statements in official publications which have the effect of obscuring the truth, to use polite language. At present we are being faced with a barrage of misleading information from Government sources on every aspect of our economy, designed to cover up the appalling reality until the Government can find a convenient moment to go to the country without, they hope, their sins finding them out beforehand. Our job is to find out their sins and display them. That is what we are here for. Our only trouble is that there are so many sins that it is hard to track them all down, but we will keep after them and get most of them into the public eye before the election.
It is one of the tasks of the Opposition to counter this kind of activity although in this country in the past no Opposition have ever had to encounter such a mass of misleading information in official publications, as distinct from Government speeches which, traditionally, coming from the other side of the House have not been entirely accurate, publications which in the past have been accepted as repositories of objective truth. It is vital to this State that they should continue to be so accepted and that, whatever is being done with them now, when we have a change of Government they will be so accepted again, and the public can again trust documents published over the imprint of the State.
This whole campaign is orchestrated by the Government led by the Taoiseach. An example of his methods is provided by his Ennis speech on 17 August last. I shall take four statements from that speech and compare them with the truth as now disclosed. First he said:
The Budget we introduced checked the excessive growth of public expenditure which we could not afford.
The fact is that current expenditure had risen by £501 million, or 21 per cent, in 1978, Deputy Lynch's last year as Taoiseach. This is the excessive growth of public expenditure which the new Taoiseach was to check. In his first year it has risen by £797 million, or 27 per cent.
Secondly the Taoiseach told the people of Ennis who, no doubt, were enthralled by all this:
The Budget we introduced achieved much greater equity in the tax system.
What are the facts? The facts are that last year's budget had the effect that taxpayers with incomes under £10,000 a year, and with average patterns of expenditure, were left worse off. Those with more than that income were left better off and a man with £50,000 a year, by taking appropriate measures under that budget, could improve his net after tax income by a cool £10,000. That is what the Taoiseach called introducing much greater equity in the tax system. To the Taoiseach equity means the rich getting richer and the poor getting poorer. The word has no other meaning for this man.
Thirdly he said:
The general financial strategy of the Budget has been successful. The financial targets set have been generally adhered to.
The fact is that the current budget deficit exceeded that provided for in the budget by £200 million and capital spending exceeded the budget by £120 million. Borrowing exceeded the budget planned level by £320 million.
Fourthly he said:
The balance of payments situation has been stabilised.
This statement was backed up by other Government spokesmen at that time forecasting a £575 million external payments deficit. The fact is that the balance of payments deficit far from falling, as had been predicted, from £730 million to £575 million actually rose to £750 million according to the "Economic Background to the Budget" which, in view of the other statements in it, is unlikely to make the position any worse than it really is.
One is entitled to ask the Taoiseach whether he simply had not a clue five months ago as to what was happening in our economy and in the Government's own finances, or whether he knew but gave a misleading account to the people when speaking in Ennis.
The outstanding hallmark of this Government has been their total inability and unwillingness to come clean and tell the people the truth about our situation — the essential first step to putting right so much that is now terribly, terribly wrong. The people are entitled to a minimum of truth and frankness from their rulers. They are not getting it now.
They will get it after the next election when Fine Gael in Government will tell them the truth about the situation we will have inherited from Fianna Fáil. We will take the people into our confidence about the measures needed to put things right. Through open Government we will bring this country back to solvency, to prosperity, and to a situation in which the new generation can trust their Government and have a genuine hope in their future in this island.
