I listened with interest to what the Minister had to say about this Supplementary Estimate and I wish to put on record that I cannot accept the reasons expressed by him for bringing in this Supplementary Estimate. I hope in the course of my response to show that no Supplementary Estimate was necessary.
I do not believe that the second paragraph of the Minister's speech came from the Department of Posts and Telegraphs. It was either from the Department of Finance or from the Government. It renews what I called the propaganda paragraph dealing with the State's finances in relation to the budget of 21 July. Seeing that it has been included in the statement I should like to put a few questions to the Minister that have remained unanswered since the Government came to power.
The current deficit is stated to be £952 million. I and many other Deputies from this side of the House asked where that figure came from. It has never been defined. I asked for a breakdown of it but it has never been given. One can produce figures and it is very easy to do so but it is a different matter if one is put on the spot to give information on them so that they can be constructively criticised. I can only assume that this figure cannot be quantified by anyone. In their projection for the current budget deficit for this year the Central Bank have not arrived at any such figure and neither have the ESRI or any other body. Therefore, I hope the Minister will take the opportunity when replying of giving us some definition of this £952 million. The Central Bank have not deviated from their projected figure of about £800 million. That is the figure they were talking about both pre-budget and post-budget. The ESRI produced a pre-supplementary budget current deficit of £770 million. I fail to understand how the figure of £952 million was arrived at.
When we talk about decisions taken by the Government to reduce current budget expenditure in this year we are entitled to be given some of the facts as to where the savings have taken place. In the budget statement of July 21 there was reference to a figure in this connection of £148 million. In the Minister's speech at that time there was an indication of where part of that amount could be accounted for. This was by way of the increase in charges being allowed to the ESB and the Minister assumed that the Fianna Fáil Government had intended subsidising the ESB to the extent of the charges that were not allowed earlier in the year. We have been accused of not allowing the increases for political reasons but we know that the ESB applied for an increase of only 12½ per cent. That was at the beginning of the year but when we considered the trends in world markets in respect of oil and so on and when we considered also the total financial position of the board, we decided that in the difficult economic circumstances in which we found ourselves this was not the year to sanction an increase in ESB charges. However, not only did the new Government sanction the increase but they doubled it thereby allowing the ESB to increase charges by 25 per cent. Shortly afterwards the ESB accounts were published and showed a profit of £6.6 million. Built into those accounts was a depreciation of £28 million. That is normal but what is abnormal is amortisation of £28 million and which we all know represents a doubling up and an improvement in the cash flow. It was not responsible of the Government to sanction the increases in the present circumstances. Their decision will have serious repercussions not only for the individual user but for industry during the coming winter months. It will have a serious effect also on the accounts of the Department of Posts and Telegraphs since they, also, are a commercial concern.
We should be told where the remainder of the £148 million is to be saved. Despite all the propaganda about what this Government are doing, despite the long meetings that took place behind closed doors early in July, we find from the Exchequer returns for the third quarter of this year that current public expenditure is running at just more than 5 per cent more that it was for the first half of the year. The figure when we left office was 20 per cent greater than 1980 figures but that was not exorbitant when we take into consideration that the inflation rate was not very much more. The figure now is 30 per cent ahead of the 1980 figures. That is not in line with the sort of propaganda that is inherent in the statement of the Minister today or in any other statement emanating from the Government.
Apart from the extra revenue that will accrue as a result of the supplementary budget we know that returns for the last quarter will show a big increase also but the £952 million figure has not been quantified. I hope to show during my contribution that the reason given for this Supplementary Estimate is not the real reason. The Government are trying to put the blame for the requirements of extra money on us by saying that we did not provide for sufficient funds under the various headings. Within the past week spokesmen of the Department of Finance have admitted that of the £332 million they have been telling us was being saved, £134 million is not a real saving, that it represents demands being made for additional equity by semi-State bodies. Therefore, this £134 million is not being considered this year. It is being put forward into next year. This was a sleight-of-hand in the presentation of figures to the public and to the House but I suspect that this illusory amount is part of the £952 million current budget deficit. We are entitled to know how the balance is made up.
Regarding CIE charges, the Minister will know from the records that there was no question of a postponement of increases so far as we are concerned. In the first half of the year there was a conscious Government decision not to increase fares. This decision was taken as part of our anti-inflation programme. In addition, we realised that it would not make good sense to increase transport charges at a time when the transport fleet was breaking down all over the place. To have allowed the increases would have discouraged people from using public transport whereas our aim was to do the opposite. A Supplementary Estimate was approved unanimously here for the purpose of recouping CIE to the extent of £9 million. Therefore, there is no point in the Government endeavouring to include CIE and the ESB as part of the savings they are talking of. I shall wait patiently to learn how the £148 million can be made up.
From listening to the propaganda put forward by the Government one would be forgiven for thinking that this is the first year in which Supplementary Estimates were introduced whereas we have had them for practically every year since budgets were introduced to the House. Because of the nature of the Department of Posts and Telegraphs, they will always lend themselves to the necessity for Supplementary Estimates but the reasons for this must be given. This Department are a service Department and should not be treated in the same way as any other State Department at Estimate time. They offer a round-the-clock, 365-days a year service to the public in the area of telecommunications and also on the postal side. The public are paying for the service and they are entitled to have it. Consequently, we must provide for any contingency that may arise in the Department during the year. An example of such contingency was the breakdown in the lines in Clare Street not very long ago and when, if all the available people had not been put to work on the necessary repairs, about 1,400 business people might have been put out of business because of not having telex and telephone services for some time. That would have happened if the philosophy being propagated by the Department of Finance had been brought to its logical conclusion.
The Department of Posts and Telegraphs are a service Department. They must be looked at and treated separately in that respect in relation to the service they perform and the way they serve the public. The public are paying dearly for the service and are entitled to ask for and get it. This Department are always subject to the very same increases as any other industrial project, manufacturing industry or otherwise, in the private sector. They are subject to normal increases in rates. When the people in the Department of Posts and Telegraphs do their Estimates starting in July or August they are not aware what the rates will be for the following year. They are subject to the increases that take place in electricity charges, to which I have already referred. Was anybody aware of what this increase would be last September-October or December when these Estimates were made out? Could you look into your crystal ball and see what they were going to be? Could the people there have been aware as to what decisions would be taken in the budget that affected the Department of Posts and Telegraphs? There have been increases in the price of petrol and oil, and the Department operate a very big transport fleet. All those areas come up during the year for decision at various times, and it was not possible, nor will it ever be possible for anyone doing Estimates in October, November and early December to foresee what these increases would be. There is no point in trying to put a different picture on it. That is the reality. I have been there for a short time and I know the reality. You must look at reality and not be living in cloud-cuckoo land.
When we look at the way the Estimates are approached in relation to the Department of Posts and Telegraphs — it is probably the same for any other Department; I have experience in only one — we see that no allowance is made by the Department of Finance for contingencies during the year. This is the way the business is run, and when this is the way it is run you play the game by the rules. In the private sector that would not be termed good accountancy if contingencies were not allowed for, but this is the way the system runs. You play it by the rules and there is no point in trying to say that the rules are changing from year to year. They are not. They are the very same rules as always. During this year I attempted to change the rules somewhat, and had that course been followed through the amount the Government would be seeking in this House today through the Supplementary Estimate would be no more than £5 million and it might be even slightly less.
No allowance is made for contingencies by the Department of Posts and Tele-of-han graphs in relation to Estimates. Neither is there any allowance in the Estimates in the beginning of the year for claims that are being negotiated freely through the civil service arbitration scheme. The Department of Posts and Telegraphs employing as they do over 28,500 employees, represent half the civil service. Surely any sensible, reasonable person looking at the situation will know full well that in the pipeline at all times there must be various claims from various sectors of that huge Department and the huge number of people employed there. No contingency allowance is made in any Estimates of any year for awards that may be made. It is not possible to prejudge what awards may be made or what negotiations will be entered into freely during the year. Of course, we know the approach of this Government to agreements negotiated freely in areas of the Department of Posts and Telegraphs since they came in. The biggest item here in relation to the Supplementary Estimate is wages, travelling expenses and adjustment of allowances. The bulk of what we are looking at here is the outcome of agreements negotiated freely and entered into freely. No contingency allowance is made by the Department of Finance for the Department of Posts and Telegraphs in advance. Consequently you have and will continue to have a Supplementary Estimate for the Department of Posts and Telegraphs every year.
I come to the main point and I will listen with interest to what the Minister has to say in reply. In my time over there I examined in detail both the current and capital Estimates of the Department of Posts and Telegraphs. I found that the building and equipping of new telex exchanges are paid for out of current expenditure. The building and equipping of new post offices are paid for out of current expenditure and the new data exchanges and all that goes with them in equipment are paid for out of current expenditure. You do not need an accountancy mind or a very upper-class intelligence to know that if you build telephone exchanges and they are paid for out of capital expenditure it is not a great challenge to anybody's intelligence to know that so too should telex exchanges, data exchanges, new post offices and all that goes in that area be part of a capital programme. There is a traditional reason for this which goes away back into the past. Even the Department of Posts and Telegraphs do not mention telephones, telecommunications, telex or data. This is one of the oldest Departments of State. It was posts and telegraphs and all that was involved in the early stages was sending telegrams. We have moved a long way since that, but the Estimates for the Department of Posts and Telegraphs have not moved with the times and with modern developments. When I looked at the situation very closely I found that the statutory position did not allow that situation to be rectified and put right. However, I took the opportunity early this year in this House of bringing in what used to be called a telephone Bill. I changed it to "telecommunications" and I made provision for this situation to be put right. It should have been put right, but the matter has not been followed through. The expenditure for the items which I mentioned and many other capital items still appears in the current account of the Department of Posts and Telegraphs which is the wrong place for it. Had that exercise been followed through, the legislation that I introduced earlier in this House would have resulted in up to £20 million being moved from current expenditure, where it is wrongly placed, to the capital account. If you were to subtract that from the net figure of the Supplementary Estimate brought forward here today of £24.45 million odd, there would be little or no need for any Supplementary Estimate.
When we look at savings and where they are taking place in relation to some subheads, surely we must question whether it is the responsible and sensible thing to do. When we talk about the reduction in subhead C of money on sites and buildings, is it good commercial philosophy to follow the road of cutting back on a development programme at this time? We must take a commercial view in relation to the development programme. Time is money and if we postpone the buying of sites and the erection of buildings, does anybody suggest seriously that it is going to cost less next year or the year after or the year after that? Time is money, but the public sector apparently do not take the same view as the private sector. They are always inclined to cut back programmes, to push them back down the line, but the end result will be that it will cost more money in the long term. In the commercial area in which the Department of Posts and Telegraphs operate the best commercial sensible approach is to do the job as fast as you can do it. It is going to cost less now. It is going to bring all the other investments you have made prior to now into being much more quickly and you are going to have a quicker return on your investment and at the end of the day you are doing a better job for the country and for the taxpayer. Forget about the philosophy of trying to do only a bit this year, only a bit next year and only a bit the year after. That is the expensive way in the long term. It is penny wise and pound foolish. It is not a good approach to a commercial situation such as exists in this Department. I hope that in that programme there will be no cutbacks of any material that will upset the programme that is there.
The economy and the country need it very badly. Exporters rely very heavily on telex and telephones. This is their lifeline in business. We should do everything we can to help them rather than making cutbacks in these areas.
Balancing books is a philosophy which is being tossed about. In this area that is bad business and the economy and the taxpayer will be the sufferers in the long term. What effect will these cuts have on our economy? I wonder what is the strategy of this Government to high unemployment when I see what is taking place, and what is reported to be taking place, in that Department. No new jobs are being created. Up to now no telephone installers have been employed. There have not been any exams for trainee technicians. There have not been any promotions or new positions, although the telecommunications are is expanding. What will that do for our unemployed?
I read with interest the budget statement of the Minister for Finance. I thought there was a glimmer of hope and he was seeing the light of day in the area of recruitment to the productive part of the public service. In a situation of rising unemployment and an expanding telecommunications business, it is daft to cut back on jobs that need to be filled by technicians, trainee installers, labourers, engineers and so on. These jobs are available so why not train the young people to do them?
I regret the clock has been turned back in this area. I also very much regret that agreements freely negotiated under the conciliation and arbitration scheme when I was in office were set aside after the 21 July embargo and the Department were reneging on implementing those agreements. That is a breach of goodwill between management and unions. What do the negotiators who have gone through a great deal of trouble to get those agreements, feel when the Government of the day refuse to implement those agreements? I ask the Minister to look at this area again and to tell the House that agreements negotiated by a previous Minister with the trade unions will be honoured. If they are not honoured — there is a deadline and I have heard it said the Government may change their minds — there will be trouble not only in the development programme but in the maintenance of services. Everybody knows there is a history of bad industrial relations in that Department. We changed the situation and if this Government do not implement agreements reached during the term of the previous administration, I believe they are going along the wrong road which will affect the Department, the public and the development of our economy.
I cannot see the sense of not employing the many school-leavers who are coming on the employment market. Many of these people are suited to the jobs available — trainee installers, technicians and so on. I cannot understand why the embargo should apply to the productive sector of the public service. I raised this matter with the Minister for Finance last week and I am raising it with this Minister today because it is not good economic policy to shut the door on opportunities that exist for young people. Why not train as many people as we can because we will need them in the future? For too long the Department were starved of the required number of engineers. In a projection for the eighties — having looked at the requirements of the private sector and the Department — it transpired that the universities will not produce sufficient electrical engineers to meet requirements. Over the last year engineers have been recruited to the Department. Why should we stop recruitment now? These people are needed now more than ever before and we should take this opportunity to recruit them so that we can implement this programme. We should give school leavers the opportunity to take up good and interesting careers in telecommunications. They should not be stymied by the policy pursued by this Government of no recruitment to the productive sector of the Department of Posts and Telegraphs.
This is a big and unwieldy Department but an interesting area in which to work. In my short time in office I tried to look at the vast amount of work done in Dublin. I am sure the Minister is having the same problem I had, that is, many people come to our clinics and ask for transfers to the country. The initial step of decentralisation was taken by the previous Government who transferred some work to Waterford and Dundalk, but that should be only the start. There is far too much work done in Dublin. Too many rural people are working in Dublin, and not by choice because they would love to work in their own areas.
With the development of computerisation there is more room for decentralisation. The accounts department need not be in Dublin. By linking computer lines to the computer in Dublin that job can be done anywhere. For that reason I took a decision to appoint regional managers, with responsibility for sending out accounts and collecting money. We would have a far more efficient and effective service if we expanded this operation.
An application for a telephone involves 29 pieces of paper. We should get away from that situation and take full advantage of the computer industry by streamlining that operation. This could affect not only telephone applications but also accounts and many other areas. If we did this the Department of Posts and Telegraphs could be the most efficient Department of the State.
Computerisation has brought many advantages. What happened the directory inquiry computer service I had tested and which was ready to be introduced when I left office? For a short period there was an industrial dispute which has been settled for some time. Yet I have not seen the introduction of the directory inquiry computer service which is so badly needed by the public. This work imposes a very heavy workload on telephone operators. By using the new service a person could find a telephone number within a few seconds. Perhaps the Minister would tell the House when this new service will be introduced.
There are many other services which should be ready for introduction — for instance, the car telephone. The specification was well on the way when I left office and should be ready by now. The Minister might tell us when this scheme will be implemented. It could be extremely useful in areas where there are difficulties in providing ordinary telephones.
We are facing many technological changes which are part of telecommunications development. Ireland is fortunate in that last year we took the decision to use modern digital technology which can bring our telecommunications service to the same level as that of our EEC partners. Many people thought this would not be possible and may still have some reservations, but if they look at the transformation of telecommunications in France between 1974 and 1981 they will see that the job can be done by the use of modern technology. The situation in France was much worse than here.
I wonder why the digital exchanges in Athlone, Kells and Bantry have not yet been opened. Perhaps the Minister would clarify whether this is due to reneging on agreements which had been freely negotiated with the staff. I believe this is the reason these exchanges have not been opened. There has been a policy of non-co-operation with the Department during recent months. I hope the agreements will be honoured and that the exchanges will be brought into use as quickly as possible.
We have read in the newspapers that RTE are exerting pressure for an increase in licence fees and apparently they lodged an application for an increase some months ago. The Minister might tell us his approach to this matter and when he will announce his decision.
I also wish to refer to citizen band radio and the personalised radio service. My approach to this subject was clearly defined during my term as Minister and before I left office my policy had the full acceptance of the general public and CB fans. I had drawn up a statutory order which had not been returned from the Attorney General's office. The use of citizen band radio is common in all western countries. It is very difficult to estimate exactly how many users there are here but there could be as many as 50,000. Various arguments have been put forward as to whether they should use the FM or AM frequency and I made a decision to license both for a period of two years. During that period those using the AM frequency would have had the opportunity to eliminate all interference and to prove that AM usage causes no more interference than FM. This was a fair response to a situation which the Department of Posts and Telegraphs are not in a position to supervise. The resources available in the radio section of the Department would not be adequate to trace those using very high-powered amplifiers. The body representing CB users were prepared to identify these people if they did not comply with the statutory order I had prepared so that they could be stopped from abusing the system.
It appears from the statement issued by the Minister for Posts and Telegraphs that he has decided to narrow the two-year period to one year and that he will not give the opportunity to prove that AM usage causes no more interference than FM. He has already made up his mind that AM will not be licensed after the initial period of 12 months. This is a retrograde step because there will not be co-operation from CB users and problems will escalate.
The Minister is responsible for ensuring that there is minimum interference for radio and television users. Many of the complaints received in the Department cannot be traced back to the use of CB radio. They are due to inadequate connections for cable television and inadequate provision for television reception in certain areas. Citizen band users have helped many people to eliminate interference by putting certain gadgets on televisions. They were offering co-operation. Apparently that co-operation has been refused; the clock has been turned back. That is my interpretation of the Minister's statement today. I am asking him to have another look at it because I do not think it is the correct approach. Given the two year period, those people would be able to show to the Minister and everybody else that the situation can be changed drastically. I do not know how the Minister will change the position if he continues in the direction in which he has been going.
If the policies I followed and the decisions I made in the Telecommunications Capital Act had been carried out I suggest there would have been no reason to bring in a Supplementary Estimate for the amount now being sought — it would not have been any more than £4 million or £5 million. I have already asked the Minister if he accepts that of the £332 million mentioned in the second paragraph of his statement, £134 million is an illusory figure, a transfer from this year to next year, that it represents the demand for equity by the various semi-State companies and that in effect it is not a saving this year because a commitment was not given to bring it in.
Does the Minister, and the Government, now accept that that £134 million is not the saving they had made it out to be? The Minister may not be in a position to quantify or qualify for me what is the balance of the current expenditure of £148 million about which I have asked for information. I accept the Minister now in the House is not responsible for Finance and may not be in a position to give me the information, but if that is the position he should not have included that second paragraph in his statement. Statements on current budget deficits are irrelevant during the debate on a Supplementary Estimate. However, if they are made and when I as an Opposition spokesman challenge their veracity I hope the Minister will be in a position to let me have the information.
If the Department of Finance continue to proceed along the old traditional lines in their dealings with the Department of Posts and Telegraphs we will have Supplementary Estimates every year. Contingency allowances are not made by the Department of Finance: they do not make allowances for possible increases in the budget or for agreements on negotiations that may be in the pipeline under the conciliation and arbitration scheme. As long as that situation remains we will have Supplementary Estimates every year. A commercial situation should not be approached in that way, particularly in relation to a service industry like that operated by the Department of Posts and Telegraphs. The approach and the treatment must be changed if we are to get accuracy in accounting and in estimation. If the approach is changed we can do away with the need for Supplementary Estimates. That is the logical position. We cannot say in present circumstances that this is the last year in which Supplementary Estimates will be needed. I am glad that the Minister for Finance last week acknowledged in reply to me that the procedure must be changed and that more information will have to be given not only to the House but to the general public so that we can do our job more efficiently and consequently more effectively.
