Dáil Éireann debate -
Wednesday, 15 Jun 1983

Vol. 343 No. 7

Private Members' Business. - Postal and Telecommunications Services Bill, 1982: Committee Stage (Resumed).

SECTION 14.

Debate resumed on amendment No. 30:

In page 14, subsection (1), between lines 4 and 5, to insert the following:—

"(a) to provide a national telecommunications service within the State and between the State and places outside the State,".

—(Minister for Posts and Telegraphs).

Mr. Leyden

I was making the point before the adjournment that I accept the Minister's amendment. My amendment is to emphasise the need for a full and efficient telecommunications service. To the man in the street telecommunications means a telephone service. I am not satisfied with the quality of service we have today. We must make every effort to improve the service.

It will be the responsibility of An Bord Telecom to complete the four-year programme which we introduced in 1980. Improvements should be evident in the next 12 months. The board should investigate at the earliest opportunity the reason the service has not been improved.

In relation to telephone accounts I made the point that there is major dissatisfaction with the accounts system. When I was in the Department I put forward a proposal to introduce a two-monthly account which would allow a consumer to have a better knowledge of the phone calls he or she made. The bill would not coincide with the Electricity Supply Board's bill and so ensure that the consumer would not receive two large bills on the same day. The ESB, who must arrange for the manual reading of metres and for the return of the figures to the offices, are able to provide a two-monthly account system so I see no reason why the Department or the new board when in operation will not be in a position to provide an accurate service. With the new technology, with particular reference to the digital exchanges, facilities are available for the provision of accounts showing details such as the destination of each call and the cost of it. In Britain there is in operation for a trial period a pilot scheme involving about 10,000 consumers. The new board should introduce a similar type scheme as soon as possible after taking over. As I stated earlier, I receive many representations from my constituents in regard to telephone accounts. When I was in the Department I was aware of the many complaints from every constituency in this regard. I am sure the Minister will agree that a detailed account system would make it much easier for consumers to know how their accounts were made up.

The other day I received an unusual complaint about a telephone account. What was interesting about the complaint was that the person concerned had received a letter from the Department referring to an inquiry he had made on May 2. My constituent had paid his account by that stage and had not made any complaint in relation to it. He received from the Department information in respect of reverse charge calls supposed to have been made to him from London or elsewhere in Britain and from other places. I have followed up this matter and I have made telephone calls to some of the numbers involved only to be informed by the people concerned that they had never heard of the gentleman in question or of his telephone number. Some of those I phoned had never heard of the area that the person was from. I have asked the fraud squad in the Department to carry out a full investigation of the circumstances surrounding this case. I am not referring to officials of the Department when I say that there has been some major error but I should like to get to the bottom of this complaint because it may be an indicator of the many other complaints that arise in the Department. The consumer in question is very concerned now in case this situation has been arising for a number of years in relation to his accounts.

An Ceann Comhairle

The Chair has some doubt as to whether the Deputy is relevant.

Mr. Leyden

It is relevent to the telecommunications services in terms of meeting the commercial, industrial and social needs of the State.

An Ceann Comhairle

Perhaps that is so in a general way.

Mr. Leyden

That was the detailed point I wished to make. I am sure a survey would reveal that the general consumer is not all that satisfied with the present service. In some cases there may be justification for this but not in others. As a consumer in an automatic area, I have no complaint to make regarding the service but many consumers and business people particularly have major difficulties in obtaining lines for the purposes of carrying out their business. This is one of the most important areas that the new board should investigate.

On the cost of the installations, I am very concerned that there have been 12,000 refusals for telephone service. This is a major blow to the Department and it will also present difficulties for the new board because if this trend continues they will be in a very difficult situation. Some of the popular radio stations have carried out surveys on installation costs and have found that they are very high. I would refer to a situation in which the Minister had discussions with a certain institution. I shall not go into this in great detail now but I shall probably follow it up later. As reported in the Irish Inde-pendent and the Irish Press of June 14, the Minister made a statement regarding the 12,000 rejections in respect of telephone installations.

An Ceann Comhairle

Surely this is more a matter for the Estimate.

Mr. Leyden

I do not think we will have an opportunity of debating the Estimate for this Department. The Minister said that the refusals will create major difficulty for the Department and for the board. The scheme prepared by the Department and sent to postmasters throughout the country is accurate. The Minister should have been aware that this scheme was being proposed. He stated that my information was not correct. He said that a letter had been circulated to head postmasters and district managers telling them that a scheme had been agreed with Bank of Ireland Finance but not approved by him and that there was no deal. The Minister should investigate the reason for that document being sent out. It indicates that he had arranged loans covering about 75 per cent of the advance payments by way of three instalments on the telephone bill and that the scheme would come into operation at the end of May. Either the Minister is misleading the media or the Department are misleading him, but it is unfair of him to make the allegation that the officials carried out something without ministerial approval.

An Ceann Comhairle

The Chair fails to see how this is relevant.

Mr. Leyden

I am satisfied that it is relevant to the section. It relates to services.

An Ceann Comhairle

The section proposes to establish a new system but how something that has gone on under the old system is relevant is difficult to understand.

Mr. Leyden

It is relevant that 12,000 phones have been rejected.

Minister for Posts and Telegraphs (Mr. J. Mitchell)

That was last year.

Mr. Leyden

And the number is increasing.

Mr. J. Mitchell

Yes.

Mr. Leyden

There are many people who had telephones installed——

An Ceann Comhairle

We are not discussing the old service.

Mr. Leyden

In terms of policy the old service has much relevance to the board. They will be interested in what has been happening in the past three years. Last year 12,000 phones were rejected. The Minister may be able to indicate whether the trend this year in that direction is increasing. He was proposing a scheme. I have never criticised the scheme but I criticised the fact that it was being undertaken without other banking organisations being given the opportunity to participate.

An Ceann Comhairle

The Chair has not objected to the Deputy's passing references but I am ruling out any further discussion on this matter.

Mr. Leyden

It is in the best interest of An Bord Telecom that an arrangement be made to reduce the installation fee for telephones. People are finding it extremely difficult to afford the installation fee. Furthermore the people who have phones installed are finding them difficult to maintain due to high charges for telephone calls and the difficulty experienced in the billing system. These areas will have to be investigated quickly. The decision making areas should be improved under An Bord Telecom. There will be a new dynamic board with dynamic management and continuity of arrangements. In the last 18 months there have been three changes of Government and three Ministers and that has played havoc with continuity. With a chief of the calibre of the man appointed there will be continuity and an opportunity to improve the service as a whole. If we are going to draw up a scheme it should be drawn up at minimum charge to the consumer, with the best possible interest rate, with fair competition with all the banking institutions and priority should be given to the Irish Telecommunications Investment Company Limited.

It is unfair of the Minister to say that my information is inaccurate and it is also unfair to deny that this information was circulated and that the scheme was prepared and put forward to the sub-postmasters.

An Ceann Comhairle

Deputy Faulkner, please.

Mr. J. Mitchell

Would Deputy Faulkner mind if I answered?

An Ceann Comhairle

The Minister is entitled to come in now.

Mr. J. Mitchell

The letter to which Deputy Leyden referred was issued without my knowledge or authority and the first I heard of it was when I read about it in the paper. The explanation is that officials in the Department were working in advance to tip off people that a scheme was coming up for early implementation. When the proposals were made I said that they were not good enough and that we would look elsewhere. That is what we are doing.

Earlier we referred to the fact that this was the first year in which postal charges were kept down. This is the case with the telephone system. Because of the present connection charges there is a growing cancellation rate. A survey showed that the reason for cancellations was because most people could not afford the high connection charges. I initiated proposals to make charges less onerous on the public. I hope to bring in a new scheme under which the connection charges can be paid over the first number of quarterly bills rather than on the first quarterly bill. There is not a final agreement yet but I hope arrangements will be made in the immediate future.

I got the impression from the newspapers that Deputy Leyden was attacking what I was doing but I am glad to hear that he welcomes the efforts we are making to reduce the initial outlay.

In relation to Deputy Leyden's comments on the billing system, I share the Deputy's concern at the number of complaints. I have initiated discussions to see how this might be improved. With digital exchanges coming on stream there will be an improvement in the service to the consumer but we will not have digital services everywhere for a long time. We are also looking at the possibility of making meters available to customers for a small rental charge to see if it will improve the situation. I am conscious of the problems and we are tackling them.

Mr. Faulkner

My comments on Deputy Leyden's amendment would be similar to those made on his amendment to section 12 but as the Minister had agreed to have a look at that I am reasonably satisfied. The provision of a telecommunications service to meet the domestic, industrial commercial and social needs of the State or a comprehensive and efficient telecommunications service to satisfy all reasonable demands for such a service throughout the State was the basic reason for establishment of An Bord Telecom. If I had believed that the Department could operate more efficiently in respect of this type of business I would not have decided on introducing the new system or establishing the interim Bord Telecom.

I agree with Deputy Leyden that there is considerable public dissatisfaction with the service. We ought to ask ourselves why the service was bad over a long period. The answer is that it was totally underfinanced. For far too long the finance available for the development of telecommunications was abysmally low. We had a very small staff of technicians and engineers and a considerable amount of time was spent in repairing a system which at its best was unsatisfactory. I do not blame former Governments, Ministers or the Department. We must recognise that up to the end of the 1950s, when a very considerable industrial revival began, the demand for telephones for industrial purposes was relatively low and the demand for telephones for social purposes was also low. In those circumstances if a Minister came to the Government and intimated that by 1980 we would need so many thousands of telephones, he would have been told by his colleagues that this was rubbish and that they had to utilise capital for building houses, schools and hospitals. Industry developed rapidly throughout the 1960s and the telephone system was caught napping. It was some time before it was recognised that a better telephone service was needed. It was because of this that in the late 1970s I requested the Government to make available £650 million over a five-year period for the development of the telecommunications system. The Government agreed to this. That £650 million was more than had been spent on the whole telecommunications system from 1922 to that date. That gives some idea of the under-financing. It is very easy in hindsight to say what should have been done but it is quite a different matter when dealing with it at a specific time.

We needed at that time 500 new buildings and we had to start from scratch. To speed up the provision of these buildings I decided to set up a joint committee of officials from my own Department and the Office of Public Works in order to cut out red tape. They were told that the money was there and that they should go ahead and do the job. One has only to look around the country at the number of buildings now available for telecommunications purposes to see the very considerable progress that has been made.

An Ceann Comhairle

The Chair feels that the Deputy's speech would be more appropriate to a Second Stage debate, since Committee Stage is confined.

Mr. Faulkner

I have a right to explain very briefly the background to the problem and why development did not take place until relatively recently. It was very interesting that one national daily paper criticised me in a leading article for having the temerity to set up this committee and make money available at a time when there was a Post Office strike. If they look at that article now they might have a different view.

One of the advantages of having a very antiquated system was that we were able to move from that to one of the most advanced systems, leaping over the British system. I believe there will be a very worthwhile improvement in the system in a relatively short time. We are coming towards the end of the five-year period and the installation of telephones has advanced very rapidly. I read a statement by the Minister that telephones would be available on demand towards the end of the year.

Mr. J. Mitchell

Next year.

Mr. Faulkner

It was not too bad a forecast.

Mr. J. Mitchell

Our problem is that nobody believes us following Deputy Reynolds's term of office.

Mr. Faulkner

Deputy Leyden has already raised the question of the cost of installation. While any new scheme to help with installations would be worthwhile, the Minister might consider subsidising installation costs on the basis that in the future there will be profits from the telephone system. We are entitled to expect such profits judging by the experience in Britain.

Deputy Kelly made some comments on the name "An Bord Telecom". He mentioned the fact that the usual word for telecommunications was "cumarsáide", He also mentioned "cian amharc" in relation to television. Having been responsible for the name An Bord Telecom Éireann, I think he would accept that words are introduced from one language to another. For example, "telefís" is reasonably close not just to the word "television" but also to the word of that meaning in other languages besides English. In respect of An Bord Telecom Éireann we are aiming at a name that would be easily recognisable and freely used. If we used the name "An Bord Cumarsáide" people might have greater difficulty in using it.

An Ceann Comhairle

The Chair's difficulty is that we are on section 14 and there are 104 sections and two Schedules and we must conclude by 5 o'clock tomorrow.

Mr. Faulkner

I mentioned that there are quite a number of buildings around the country now ready for use but I am somewhat disappointed that two such buildings in my own constituency, one in Drogheda and one in Dundalk, are still not in operation. The building in Drogheda was to have been in use by the end of 1982 but will not now be in operation until the end of this year and a similar situation exists in Dundalk. We could make considerable progress in the area if these facilities were operating and it looks as if sufficient money is not being made available. I would ask the Minister to get these buildings into operation as soon as possible.

Mr. O'Sullivan

My main concern is the loss-making aspect of providing certain services. This could be discussed under the financial headings but it is unlikely that we will reach them.

An Ceann Comhairle

It is getting more unlikely.

Mr. O'Sullivan

I wish to express my concern that there is no provision for compensation in respect of loss-making activities. The review body took cognisance of this and expressed concern that there were no means by which this money could be recouped from the State. Services for old age pensioners provided by the ESB and CIE are funded by the Department of Social Welfare. No such facility is being provided in respect of posts and telecommunications and I would ask the Minister to consider this matter before Report Stage. It is extremely important for the future viability of both bodies.

Mr. Shatter

I welcome the amendment but I am not sure exactly what effect it will have. My interest in this legislation, particularly in the context of section 14 and the amendment, is to ensure that what I regard as an outrageously inefficient and appalling telephone service should provide a proper service for the consumer. I am concerned that the high ideals expressed in section 14 and the added obligation on An Bord Telecom which will arise as a result of this amendment will be only so much window-dressing. The point must be made that the transfer of the whole monolith of the telephone and telecommunications services from the political auspices of the Minister for Posts and Telegraphs to An Bord Telecom will not by the wave of a magic wand produce an efficient telephone service.

I am concerned about this. I should like to see very specific obligations in section 14, the empowering section, which lays down the obligations of the board. It may well be that both the Minister's proposed amendment — Deputies opposite seem to be unanimous in relation to the board's functions — may produce the trick, but I am not convinced. We have to be convinced because at present the telephone service, rather than meeting the industrial and commercial needs of the country, is effectively sabotaging the industrial and commercial needs of the people. It certainly is not meeting the domestic needs of the country because in the city and county of Dublin the telephone service appears to me to be in a state of chaos.

An Ceann Comhairle

The Deputy should not be wasting time denouncing the present state of affairs.

Mr. Shatter

Section 14, with the Minister's amendment, must be read in conjunction with section 84 which I do not think we will get an opportunity to debate. I urge the Minister to ensure that in the context of this legislation there will be some reasonable protection for the consumer. I am not sure that all these obligations being imposed on An Bord Telecom will be meaningful because it seems to me that if the board do not comply with the obligations, if they do not provide an efficient national telecommunications service, whatever that means, it seems the consumer will not have redress because no matter what the board do, as a result of section 84 the consumer will not have a comeback, no matter how inefficient, negligent or idiotic the board may be. I do not mean to insult any member of the telephone personnel——

Mr. Reynolds

That is what the Deputy is doing.

Mr. Shatter

I am voicing the frustration of ordinary people not directly involved in the telephone service. This section, read with section 84, does not give any real protection to the consumer. That is not assisted by section 45 in the Act which provided a telephone users' council which has as much teeth as an elderly pensioner who goes to a dentist in order to get the final tooth removed to have false teeth inserted. It seems to me there is a need to top up the consumer protection element. I know the Minister and Deputies opposite mean well, but without being critical of any individual Minister or Government, the state of chaos in our telephone service will not automatically be solved by what is in this section in conjunction with the Minister's amendment.

An Ceann Comhairle

The Deputy is repeating himself.

Mr. Shatter

My concern is not being voiced solely by me. It is also the concern of people outside the House who have not had the intimate knowledge of the telephone service the Deputies opposite——

Mr. Reynolds

If the Deputy had he would not be talking like that.

Mr. Shatter

Section 14 will not do anything more than to isolate the telephone service even further from a degree of political responsibility because there is nothing in it that will protect the consumer. In the context of the difficulties everyone is experiencing because of a lack of accurate information about the telephone service, it seems the effects of this section will merely further isolate the telephone service so that it will be impossible for Deputies even to discover what is happening in relation to individual constituents by way of Dáil question, something we should not have to engage in if we had an efficient information system.

Even as a result of the Minister's amendment, the section does not give any guarantee that An Bord Telecom will provide any more efficient service than the Department of Posts and Telegraphs. If what I am saying in any way upsets staff in the Department I apologise, but it is a reality. If we simply transfer the problems that exist in the Department to the board, if nobody gets down to tackling them, the board will be saying, as Ministers said in the past: "We cannot do anything about it; we will transfer it to some form of board."

Mr. Molloy

This section places an obligation on An Bord Telecom to provide an efficient telecommunications service, and I assume the Minister agrees that an efficient service would be one in which the billing system would be efficient. I am sure the Minister will also agree that the method of assessing the charges on a quarterly basis is not sufficient. It is not accurate. It is the cause of much frustration and heartache and many complaints are being made to the Department about it. I am asking the Minister to give us some information whether it is proposed to introduce an efficient system whereby telephone subscribers will have a means of establishing to their satisfaction that the bill they will receive will be accurate and correct.

The present system does not allow subscribers to check whether they are getting correct bills. They are left at the mercy of the Department. Many people have despaired when they receive their bills because far in excess of the number of calls made are charged for. It seems they do not have any comeback. They can make appeals and it has been known that the Department have reduced some bills, but to my knowledge they have never explained the grounds for reducing them. They have never been able to explain the grounds in the first instance for sending excessive bills. They seem to make a shot in the dark like the Revenue Commissioners when they make assessments: they guess at someone's tax liability and let him prove that he does not owe it.

I do not think it is fair that a system of that kind should be operated here. I do not think the Minister can claim that if that system is to be continued he will be fulfilling the terms of this section, even if amended. In other words, he cannot claim he will be providing an efficient service. I hope he will explain to the House whether it is possible for a telephone subscriber to receive a bill for telephone calls which he did not make and which were not operator-assisted. It is possible for somebody to give another number when making a call through the operator.

An Ceann Comhairle

This is more an Estimate speech.

Mr. Molloy

We are talking about an efficient system. If the Minister is to introduce a system which will be efficient it will have to include an efficient billing system which will give people accurate accounts. If the Minister cannot indicate to the House that he will make substantial changes in the accounting system he cannot claim that he is proceeding to provide an efficient system. Hundreds of my constituents have made complaints during the years. I am not blaming the Minister, but the complaints system will have to be changed. We have all suffered from it. I have a bill in my pocket for the last quarter. It is for £519. It includes hundreds of calls that I never made. What recourse have I? All I can do is to shrug my shoulders and say that I cannot prove I did not make the calls because there is not a meter on my telephone or in the exchange which I could go in to look at.

An Ceann Comhairle

The Chair wants to get progress made so that the Bill will be given a reasonable discussion in the time ordered by the House.

Mr. Molloy

My little contribution will not hold up the House for long. Until now I have not spoken at all on the Bill and it is not my intention to delay the House. Everyone wants to see an efficient telephone system. As Deputy Faulkner said, Fianna Fáil Governments in the past made major commitments to investing capital in the telecommunications system which is at present in the process of being installed and hopefully over a reasonable period this country will have a system which will operate very efficiently.

This system will not be satisfactory to the subscribers unless the accounting is accurate and the subscriber is not held up to ransom, as happens at present. The Minister is aware of this difficulty, but it would help if he would explain to the House whether it is possible under the present system to receive a bill for calls which were not made on one's phone and which were not telephone operator-assisted. I would also like him to explain if it is proposed to introduce a more efficient accounting system in the future. It is incumbent on the Department to install these meters free of charge, as the ESB do when they extend electricity supply to a domestic dwelling. The householder can look at the meter provided by the ESB and assess the number of units he is using. He knows his capacity to pay and if the number of units used is high, he can ease off. With the telephone system one never knows until that dreadful envelope drops into the letter box.

Mr. J. Mitchell

I am aware that there is a significant perception that there is something wrong with our accounting system, and I have already initiated inquiries in the Department to see if anything can be done about it. I mentioned earlier the increasing number of digital exchanges which are coming on stream and which will enable us to provide better facilities in many respects. We are looking at the possibility of providing meters on the same basis as the ESB which, contrary to what Deputy Molloy said, are rented to the subscriber by the ESB.

Mr. Molloy

A telephone subscriber pays rental for the telephone.

Mr. J. Mitchell

We are looking at this. I know many people feel there is a problem in this area, and I will be working hard to see how we can improve the situation.

Mr. Molloy

It is highway robbery at the moment.

Mr. J. Mitchell

There are three of my predecesors present; only my colleague, Deputy Cooney, is not here. I am the fifth Minister for Posts and Telegraphs since this telecommunications system was inaugurated. That speaks volumes for the changes that have taken place and for the lack of continuity. It takes a while for a new Minister to learn the ropes. I want to pay a tribute to each of my predecessors, Deputy Faulkner, Deputy Reynolds, Deputy Cooney and Deputy Wilson, who have taken a lot of flak, which I will have to take too until we have an efficient telephone system. The steps they took when in office will result, hopefully before the end of next year, in an efficient telephone system which we all want and which the country badly needs.

Mr. Reynolds

I could not but reply to some of the comments made by Deputy Shatter on a subject he obviously knew little about. He sarcastically criticised some of the officials in the Department of Posts and Telegraphs. As the Minister said, the lack of continuity had an impact on the situation but this is a five-year programme and one cannot expect miracles overnight. The telephone service was neglected for too long. We should have started this reorganisation 15 years ago.

The reorganisation of the telephone system should have led to the commercial development of the system. This should have been treated as a commercial service in a business environment, but it was not. It was tied up by red tape, bureaucracy and outdated regulations which had to be complied with. It did not lend itself to being treated in a commercial manner. The previous Fianna Fáil Government set up the two boards to give them freedom to operate in a commercial environment, to devise management and marketing structures and to develop an efficient system, but that will not happen overnight.

We are talking about overhauling the whole telephone network in Dublin in five years and changing from an outmoded system, parts of which could end up in a museum. In one sense we were lucky that money was not wasted over the past few years because we had the opportunity of jumping the intermediate stage of development technology into the digital technology. This should give us the opportunity to have one of the finest telephone services in the EEC. As I said, one of the major problems was the restrictions on the Department when they tried to come to grips with this problem.

One of the problems facing the new board is complicated by the very high cost of telephone installations, which I believe is bad marketing strategy. We have heard of large numbers of people who are discouraged from applying for a telephone. I believe in developing the network as fast as possible and having the maximum number of consumers using that network. The correct marketing strategy should be to connect as many people as possible so that the network will be used to capacity and one will get a return on one's investment. What has happened is that the cost of installation has put the telephone beyond the reach of many people. It that trend continues the bright financial future we foresaw for those boards a few years ago will not materialise. The new board should aim at getting the maximum number of subscribers while recognising that Dublin city has a particular problem. I do not know what changes have taken place in the structure of the management of Dublin city since I left but the management structure was not geared to deal with this problem. The whole of Dublin city was one area. In my view it should be split into various subregions. This way the management could do their job quickly and efficiently.

There is another major problem in Dublin city which should be recognised and appreciated. Most of the old cabling running through the commerical areas in the centre of Dublin is very old, subject to flooding and all the problems associated with major breakdowns. All that recabling has to be done and that is a major job. It is easy to do overhead cabling and produce fairly quick results, as happens all around the country.

Many rural divisions will get phones on demand. This is the situation in Limerick and Waterford. Drogheda and Sligo are coming to that stage. Fire brigade action will have to be taken in Dublin city to remedy these major problems. Recabling operations will have to take place. Whether overhead cabling, which is undesirable from an environmental point of view, will have to be resorted to I do not know. I am not an engineer or a technician. Those are the problems that give rise to the complaints we hear in Dublin City. We cannot expect a new system overnight. It is only when the whole system is overhauled and it all gels that one will see the benefits of the big investment that has taken place.

I would urge the Minister to look at the cost of the installations. As Deputy Molloy says, people are being frightened by the size of their bills. I know the difficulties in the accounts section. I went into the Department just after the end of the very long strike and there was a huge backlog of accounts to be brought up to date on a manual system. That whole system needs to be computerised. I believe the accounts for each region should be done in each region and fed into a central computer. We should decentralise a lot of the management that is making the service top heavy in Dublin. If we could get it down into the regions it would loosen up the system quite a lot.

The strategy behind this Bill is to get the proper management structure to give the people the tools to do the job which they are expected to do. If the management pick up the challenge that is there to finish the job that has been started we will see the results in the not too distant future.

Amendment agreed to.

An Leas-Cheann Comhairle

We discussed amendments Nos. 30, 31, 31(a) and 31 (b) together. It was made clear that if No. 30 was accepted Nos. 31, 31(a) and 31 (b) could not be moved. Is that agreed?

Mr. Leyden

I accept that.

Mr. Mac Giolla

I do not accept it but I am not pressing the amendment because the Minister agreed that he will take into consideration the arguments that were put in relation to the wording of section 31 on the previous Bord Poist and we accept that.

Amendments Nos. 31, 31(a) and 31(b) not moved.

Section 14, as amended, agreed to.

SECTION 15.

Question proposed: "That section 15 stand part of the Bill."

Mr. Leyden

Quite a lot of the debate that went on for the last hour was more relevant to section 15. It is interesting that the Minister has admitted to the Dáil that it was only as a result of reading the newspapers that he was aware of the circular that went out from his Department regarding the terms of an agreement with a banking institution regarding telephone connections. It is a disturbing admission. From my experience it was unusual for the Department to go ahead with a circular to the staff of post offices and other sections of the Department. It is an interesting insight into the activities of the Department at the moment. The Minister should be concerned about the circular. It looks an authentic document. It is framed in the standard way and it was sent out in the Minister's name. Now the Minister denies the existence of the details in this document and says he does not agree with them. The Minister should carry out a detailed examination in the Department to find out why this document was sent out. My experience was that the Secretary of the Department and the staff would not send out a document like this without the Minister's approval or the approval of the Ministers of State of which there are two. The Minister's admission clarifies the issue. It also exonerates me from the blame the Minister initially placed on me for disclosing this information.

As Opposition spokesman I was entitled to query the scheme. I did not attack the whole idea of having a scheme. I queried the reasoning behind dealing with one particular institution without giving an opportunity for other organisations to compete. I did not attack the concept of some sort of scheme to assist the consumer in the connection of his telephone. I welcome the Minister's statement that he is proposing to bring forward a scheme which would be of benefit to the consumers and to the Department. The idea of assisting subscribers and applicants for telephones is worthwhile. A more worked out scheme and a better interest rate would be more appropriate. The whole situation should be reviewed.

Section 15 (1) reads:

(a) charges for services are kept at the minimum rates consistent with meeting approved financial targets, and

(b) revenues of the company are not less than sufficient to—

(i) meet all charges properly chargeable to revenue account (including depreciation of assets and proper allocation to general reserve) taking one year with another.

The difficulty in the Department was that the advance payment system is practically statutory at the moment and the arrangement for paying in advance for three and four years, depending on the distance from the work involved, is something that has arisen over the years. The general philosophy behind that was that if a person paid the advance rental he would not propose to take out the system in a short time. It was protecting the Department from the high installation costs involved in overhead wiring and erection of poles. In some cases that reached three years, advance rental and the connection charge would be £586. The actual installation cost would be £540.70. That is a lot of money to pay in advance for a system. The Minister will have to look at the situation but it will be over to An Bord Telecom in the ultimate to provide a service.

In Government we encouraged the provision of meters. I believe they should be provided to the consumer without any charge or at a minimum charge. What worries me is that the meters will not be taken as evidence by the Department. Even though the Department will approve and arrange for their installation —they are being produced in Dublin and their production is providing much needed employment — the Department will not accept the reading as proof. The Minister should encourage the idea that the meter be accepted as evidence that the account was accurate. The thing that annoys most people is that if you make a telephone call from, say, this House through the operator to a manual exchange you will find that after completing the call and if you are trying to ring somebody a few minutes later the operator may say to you: "Have you finished this call?" One is presumably being charged for that, even though the call was terminated some minutes earlier. That is happening. I have no doubt about it. It is creating many difficulties.

I was assured that, when you made a local call from a private telephone, under no circumstances could the meter be activated to record it as a long distance call. I was never fully satisfied about that. Very senior people in the Department will assure you from the advice given to them by the technical people that the meters are stored and are available in the exchanges, that the meters are photographed and the information is sent to Dublin to be dealt with and to have the accounts send down. Like any other instrument the meter can go wrong. A meter may be faulty. There is very little admission from the Department that they detected a faulty meter. The general public are concerned that some meters can be faulty. From my own experience I believe that some local calls could activate the mechanism which would record a longer time or a longer distance. Those are the two areas where the greatest difficulty arises.

There are also major abuses of the system. One abuse is accepting a reverse telephone call at a telephone box in a bar or a public place. You can arrange for a long distance call to be put through from Britain or elsewhere to a number in a public place. I realise that when you ring from a telephone kiosk a light comes on in the telephone exchange which indicates to the telephone operator that the call is from a kiosk or a telephone with a coinbox attached. This has created a certain amount of fraud. A reverse call is made to a prearranged destination at a prearranged time in a public bar or lounge or hotel. The person answers the call and accepts the charges. It is very difficult to eliminate that type of fraud. Many people who have public telephones have this difficulty. We will have to try to eliminate the problem.

When a person rings an operator and asks for a number the operator should ring back. I am told by the Department that the amount of fraud in this area would not justify the operator ringing back. I was told that the operator will ring back once in every ten calls coming through. You can credit a call to another number in your area. That is happening all the time. A person will know the number of his public representative or another well known number. He rings the operator and books a call to Dublin. He gives the number of his neighbour or somebody else and that is what is recorded. If the operator asked the person to put down the telephone and rang him back that would eliminate that problem. When I was in the Department I suggested that the operator should have the responsibility of ringing back and checking on all calls made. This has given rise to many complaints in my experience. Some years ago the operator rang back and checked. An Bord Telecom will have to give priority treatment to this area.

Deputy Reynolds said the accounting system should be decentralised. This is very important. The Minister should indicate to An Bord Telecom that there should be total decentralisation of the telephone accounts system. This would give the consumer an opportunity to query his account locally. When I was Minister of State I queried a telephone account on 14 December 1982, the last day we were in Government. I asked the Department to investigate this account. I put down a question in the Dáil this week about that account. I do not know what the reply was, but it took six or seven months before I received a response to a representation I made as an outgoing Minister of State.

In the GPO the accounts section are absolutely bogged down. They are overworked and frustrated. I compliment the section in the Department who take the calls from consumers in Dublin. They have a very difficult existence. Mr. O'Reilly was dealing with that section when I was in the Department and he had a great deal of patience. I compliment him publicly on the way he handled queries from the public. On a few occasions I took calls myself from angry consumers and it is a very difficult task to appease a consumer who has a major difficulty. His telephone may have been out of order for two or three months. The officials in that section have a great deal to contend with. They provide a grant service for the consumers who take out their frustrations on these officials. They really let go at them. These people are the frontline of the Department work under great strain.

If Bord Telecom are to work efficiently and effectively they must tackle this area as a matter of priority. This illustrates the reason behind the setting up of two boards. With new dynamic leadership and with a dynamic chief executive eager and willing and ready to get going when this legislation is passed Bord Telecom will eliminate these problems. Former Ministers had to worry about constituency problems and the other problems with which Deputies and Ministers have to concern themselves.

Mr. Reynolds

Dáil Questions.

Mr. Leyden

Dáil Questions, as my colleague said. The Department of Posts and Telegraphs must be the most demanding of all the Ministries at the moment, Today's work in the Dáil practically from 10.30 a.m. to 10.30 p.m. has been taken up almost exclusively with the Department of Posts and Telegraphs. They are one of the most hard worked Departments. They have been the butt of many attacks by the public. In the Department we have a great staff, great people who work very hard. They will have greater opportunities under a new board of management and a new chief executive. I know the personnel going in there. They will have to tackle the problems we have outlined. They will read the Official Report.

Some months ago the Minister opened up the telephone exchanges to allow the consumer to go in and see the telephone system. I was a step in the right direction to have open days for the consumers to try to satisfy them that everything is working right and that the meters are operating correctly. The public are quite clear in their minds that the system is not working right, that there is no accountability. There is not an adequate response from the GPO because the GPO are bogged down not only with parliamentary questions but also with the number of queries which have arisen on accounts over the years. In the next few days the Minister will find there will be even further queries. Due to the coverage of this debate tonight the general public will be further worried about their accounts. I regret that, but I must highlight this issue to assist Bord Telecom when they are in operation. In the meantime the Department will be in charge for six to nine months possibly. Do not allow the situation to continue. Consider programmes and policies in keeping with An Bord Telecom. If possible, decentralise the accounts system, provide more jobs in rural areas, provide a better service and give people a chance to appeal and query the accounts, a full investigation to be carried out. Ultimately the only way the public will be satisfied is with the provision of meters. They are vitally essential and I would ask the Minister to have them available on the market. They were supposed to be on the market last November-December. Let the Minister put one in his own home and see how it works. I would be delighted to have one and I shall be booking a meter because I want to know how it operates. I believe there is not one Deputy who does not want a meter installed.

Mr. Taylor

I have just a few comments to make on this section. I cannot see that it adds very much to the Bill. It purports to impose a general duty on the telecommunications company to do certain things. Now a duty is something a person or a body is obliged to do. The whole thrust of that is removed immediately and subsection (2) therefore does not mean what it appears to mean. In actual fact the company is to have no responsibility in carrying out or being responsible for any of these duties purported to be imposed on it. Really this is little more than a pious indication of what the Minister, perhaps, would like to see emerge from the company. Putting pious intentions in without any teeth is a waste of time. Looking at the wording is it, I wonder, deliberately put in the form in which it is? It says the charges have to be kept at a minimum rate consistent with meeting approved financial targets. What targets? Approved by whom? Will it be the company or the Minister? Will it be some superviser? Who will approve of these targets? That is an expression which almost has the genesis of a definition.

The whole thrust of the general duty imposed on the company in this section has altogether too much in my view of business orientation: meet all the charges properly chargeable to revenue account, including depreciation of assets and proper allocation to general reserve, taking one year with another, generate a reasonable proportion of capital needs, remunerate capital and repay borrowings. Any semi-skilled accountant would have little difficulty in interpreting that to mean that the company would have carte blanche as to what organisation it would make of the finances and what the trends and objectives of the company would be in the form of charging. Quite frankly, a company having the duties this company will have would be operating a social service in the same way as the postal service, or electricity, gas, transport and so on. The idea of such a company operating to make a profit would be and ought to be anathema. Indeed it can be argued that this should be operated as a social service subsidised to some extent out of central funds.

It is not an ordinary run-of-the-mill business and should not be looked at as if it were. I would not like it to be run in order to make a profit or even to break even. I would like to see a duty imposed which would provide that the service would be made available to people in need of the service, particularly old people living alone. The provision of a telephone service for these is not a luxury. It is a vital necessity. In many cases it can be a matter of life or death. I should like to see in this provision an obligation on the company to make special provision for old people and those who have a special need of the service. Many old people are living alone in fear and television should be readily available for them at a cost they can afford and, if they cannot afford it, at no cost at all. That should be provided as a general duty in the section.

Mr. Wilson

There is a certain lack of logic in what Deputy Taylor has said. He attaches no particular importance to the wording of the section. He says the section will have no particular effect and he suggests other words. How he thinks his substitution might have more effect than those already there I just do not know.

Mr. Taylor

Subsection (2).

Mr. Wilson

Subsection (2), had the Deputy read it to the very end, says "before any court to which it would not otherwise be subject". That changes the meaning of what the Deputy read. I regard section 15 as a very important section in view of what has happened to so many semi-State companies in comparatively recent times. A company is asked to generate a reasonable proportion of capital needs and remunerate capital and repay borrowings. Unfortunately in recent years — this was not always true and it certainly was not true of the total history of semi-State bodies since they became popular under the encouragement of the late Seán Lemass—what has been happening is that we are getting big headlines about operating profits by this company and operating profits by that company and one is not in fact really reading the true story of the operations at all. The capital needs are provided by the taxpayer and the taxpayer also has to provide future capital needs. The account one reads in the press about companies does not even refer to an obligation to remunerate capital. It is just written off. There is no question of the company remunerating capital or repaying borrowings for that matter. Really therefore one is not getting the true account of what is happening in many of these companies.

Deputy Taylor says he regards television as a social service. We very positively made certain social provisions in our social legislation and we can on this side of the House take pride in that. It was our doing. It was a Fianna Fáil idea and it is far in advance of what is available even in wealthier countries. But that should not preclude the possibility of making a profit on what is a booming business. I know there have been drop outs; so to speak, in demand but if the experience in other countries as of now because of the demand for television is that profit can be made I do not see why we should not aim at making a profit. From discussing this with the board and the chief executive who will be the chief executive of An Bord Telecom this is the objective. That money will of course be used for the development of the service or a reduction of the charges, which is a very desirable objective indeed judging by what we have been hearing during the course of the last couple of hours.

With regard to financial targets and so on there are other relevant sections which no doubt will come to the attention of those interested in this particular aspect of the Bill. Before I left office I thought that the meter would be generally available before this. I also believe that the charge would be very low. I do not know what charge the Minister is thinking of now; I read in a newspaper it would be about £16.50 per annum. I thought there would be a nominal charge of £5 or even less. There is not much point in providing a meter for people who might not make more than three or four calls per week. Charging them £16.50 for a meter would come to more than the 165 telephone calls they would make in a year.

I think in the last few months there has been the occasional callback from the exchange. Deputy Molloy made the strong point that people are perturbed at the idea that other subscribers are using their telephone numbers. The Minister used the phrase "the public perception" several times today. I agree with him that that is very important. If people think something is happening this generates its own lack of confidence in the system.

Deputy Reynolds mentioned decentralisation when he spoke about the break up of the centre. This has already occurred in some regions throughout the country and the general belief is that it has improved efficiency in various areas. This section will become increasingly important as time goes on. The kind of vibrant approach to this that I found in discussions with the chairman and chief executive of the board is the right kind of mood for launching An Bord Telecom. The members of the board, specifically the people who are mentioned, have made very widespread studies of systems in various countries, some very far away, and they have considerable experience in using telecommunications all over the world. They have stories to tell which indicate that many prestigious countries have not such a great system of telecommunications and compare unfavourably with what we have here.

Mr. Reynolds

In relation to charges for telecommunication services, it is fair to say that the business and commercial community are extremely worried about increasing costs and the strain which that puts on industry and commerce in general. It has neen one of the failings of the system up to now.

The Department of Finance decide that the Department of Posts and Telegraphs will be merely a tax collector for the Exchequer. There is no consultation about what damage those charges will do to the development of the service and the imposition it is putting on industrial and commercial costs. I spoke about this in a different debate but it is well worth making the point again. The sooner we get away from that system the better, because we have a very expensive telecommunications system and the customers who pay those very high charges are not getting the service they deserve. I know we are in the development stage but, nevertheless, the customer only thinks of the money he is paying and the return he gets.

I have already mentioned the very expensive cost of installation. It is very important to treat customers properly because basically we are selling a service. Last week I came across a case which speaks for itself. A lady had a telephone for 20 years, she moved to a different area but the Department were not in a position to provide her with a telephone because there were no terminals in the exchange. Subsequently they offered her a connection and sent her a bill for three years' rental in advance. That lady had paid her bills promptly for 20 years, yet the Department implied that she might not be there in six months' time, which is the reason for the three years' advance rental. Not enough attention has been paid to good customer relations and good business practice. This is one of the things we shall be looking forward to when the board are in operation as well as a new management approach, new marketing strategy, corporate strategy, new objectives and targets——

Mr. Mac Giolla

On a point of order, I know the previous holders of the office of Minister for Posts and Telegraphs have a lot to say on every aspect of the Bill and it is good that they make contributions. However, I appeal to them to keep their contributions short because we should be at about section 70 by now. There are sections of the Bill which deal with conditions of employment and so on and we will not reach them if Deputies speak for too long. It is now 10.15 p.m. and we are still at section 15.

Mr. J. Mitchell

I support Deputy Mac Giolla's plea. There are many important sections which are not going to be discussed if Deputies speak for too long on one section.

Mr. Reynolds

I limited my contributions on this Bill although I wish to speak on every single line of it. If the Deputy was in the House all day he would know that I made short contributions to most sections. This is one of the most important sections of the Bill. We must have the proper charges and keep our customers happy. If you have not got customers there will be no business. Deputy Mac Giolla need not be talking about workers if we have no business. You sell a service, get the money in and employ workers to do the job. That is very important. The other sections are equally important but I did not hold up this Bill. I refrained from contributing on many sections. It is important that we do not price ourselves out of the market.

Mr. Taylor

Deputy Wilson wants to make a profit out of it.

Mr. Reynolds

Why not? If that is the Labour Party's philosophy it is a wonder the Bill is here at all. Of course you must make a profit out of it. A big investment of £750 million has gone into it——

Mr. Taylor

If you make a profit you are charging high prices.

Mr. Reynolds

Not necessarily. You need a profit for re-investment and maintenance. One of the reasons there are complaints from Deputies is that there has been a cutback in relation to repairs because of shortage of finance. The customer is not getting the service for which he is paying. He is entitled to the repair service that any other business would give him and he is not getting that for the obvious reason that there is a shortage of money. There is a fictitious notion that a fairy godmother will produce the money for this. You can only get the money from two sources — taxation or borrowing. Large sums have been borrowed for the development of this service and I look forward to this operation making money and to the development all the ancillary services also and to expanding the whole service. If we do not make a profit we cannot do that. That is my philosophy and if the Minister has a different one, fine. One final suggestion is that he study the system which operates in France. Instead of demanding very heavy installation charges they think in terms of giving the customer a share in the company.

Mr. O'Sullivan

The Deputy is now preaching socialism.

Mr. Wilson

There is nothing wrong with good, healthy socialism.

Mr. Reynolds

I would have the best of both systems. I am not hung up on a particular philosophy, but am not hypocritical like some people on the Government benches who say that they are socialists——

Deputies

Hear, hear.

Mr. Reynolds

——and are right wing conservatives at the same time. How they are able to keep a foot in both camps beats me.

Mr. Donnellan

The Deputy may be able to do that.

Mr. Reynolds

If you want to get the customers into this network and are depriving them of the opportunity because you are charging them £500, £600 or £1,200 installation fee, here is the opportunity of giving them shares in the company, of partaking in the profits of the company.

Deputy Taylor might bow his head when I say something like that, but that is the way the system can be developed. But when you have a company set up, hand it over to Bank of Ireland Finance or some such company who have the ways and means of doing their own business. I set up the telecommunications company to make sure that this service would not be deprived of the necessary capital for its development. Having developed it, let it remunerate that capital and, if there are profits, why not have 530,000 shareholders — if that is possible after the capital is remunerated — and let them partake in the profits? There might be less vandalism of the telephone service if they were all getting a share of the dividends at the end of the day.

Mr. J. Mitchell

I have listened with interest to what the Deputies had to say. In relation to the financial targets mentioned by Deputy Taylor, that subject is dealt with more specifically in section 104.

I would like to touch on the question of profit. I want this service to make a profit. I believe in State enterprise and one of the things which has hamstrung State enterprise is lack of that motive. As a consequence, State enterprise has got a bad name.

Mr. Reynolds

It has.

Mr. J. Mitchell

Not all State enterprise is loss-making but many sections are. It is very important that State enterprise should succeed because if they are to get the support of the public there have to be some clearly successful State companies.

Deputy Taylor also mentioned making provisions for free telephone for old people and so forth. That is a very desirable social objective, but it should not be the duty of the telephone system. That is a matter for the Department of Social Welfare and for social policy. If you hamstring this company with all sorts of overheads or income losses, the danger is that you would be condemning the company to failure and we have enough failures as it is in the State sector. State enterprise should be given the proper environment within which to operate successfully and it very often has not been given that. I hope that the section is carried.

Question put and agreed to.

SECTION 16.

An Ceann Comhairle

Amendment No. 32 is in the name of the Minister, and Deputies Mac Giolla and De Rossa.

Mr. J. Mitchell

I move amendment No 32:

In page 14, subsection (2) (a), line 45, to delete "7" and substitute "12".

Section 16 (2) sets out the provisions which must be included in the articles of association of An Post and An Bord Telecom. Paragraph (a) requires that the number of directors in each case shall be at least seven, or such greater number as may be determined from time to time by the Minister for Posts and Telegraphs, with the consent of the Minister for the Environment.

The purpose of this amendment is to confirm the intention to have at least 12 directors on the board of each company. Twelve is the number of directors in the case of each of the State-sponsored bodies to which the Worker Participation (State Enterprises) Act, 1977, applies. Taking account of directors to be appointed following election under this Bill when enacted, An Post will have 15 directors, including five employees and one postmaster director. Bord Telecom Éireann will have 12 directors, including four employee directors. It is appropriate to say at this stage that it would be my intention on the interim board to make provision for the number of trade union directors to be equal to one-third of the number. I want to make that clear. We are proposing to have 12 on the interim board and will therefore be proposing to increase the number of directors by three — there are nine at the moment — to ensure two extra trade union directors.

An Ceann Comhairle

Amendment Nos. 32 and 32a are to be taken together, by agreement.

Mr. Leyden

Again, we shall not get hung up on this section. I would certainly agree to 12 as opposed to nine directors. The Workers' Party have a similar amendment to the Minister's, so we are all very much in agreement. My reason for putting in a minimum number was to ensure a fair balance of appointed and elected directors. It is absolutely essential that the maximum number be elected from the unions and all the organisations attached to the board. Unless you have the direct involvement of the workers on the board, you will not have the incentive produced by direct contact between the employees and the board itself. It is an essential part of this Bill that the needs of the unions and the workers be satisfied by adequate representation on the boards. I fully subscribe to the minimum number of 12 directors and believe that directorship will ultimately be 15 on An Post. The actual number will be decided by the Minister, in consultation with the Minister for the Public Service.

The main point is that there will be a fair balance and with the directors from the Post Office Workers Union and one director from the Subpostmasters' Union there will be good participation. We must bear in mind that on the interim board we have the secretary of POWU, the secretary of the Subpostmasters' Union and appointed directors also. Direct contact and direct representation of the workers on the board are absolutely essential if the policies are to be implemented by the board and the employees will be fully represented when decisions are made in regard to major policy areas. This would give protection for the workers and assist the consumers, ensuring that all decisions are made in the best interests of the Department and of the consumer as well.

An Ceann Comhairle

Deputy Mac Giolla also has an amendment down.

Mr. Mac Giolla

I thank the Minister for having accepted this amendment. It is an important one and has agreement from all sides of the House, so we can move on.

Mr. Enright

With regard to the number of directors for each company, this will be 12 for each company?

Mr. J. Mitchell

No.

Mr. Enright

The minimum will be 12 and may be increased. There will be approximately four worker directors.

Mr. Reynolds

Included, I presume.

Mr. Enright

That is what the Minister has outlined.

Mr. Reynolds

Is it eight plus four that the Deputy is talking about, or 12 plus four?

Mr. J. Mitchell

It is eight plus four in one case. It is nine plus one postmaster director plus five in the other.

Mr. Reynolds

Is it a case of nine plus one plus five?

Mr. J. Mitchell

No, that is the postal board. The other is eight plus four.

Progress reported; Committee to sit again.