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Dáil Éireann debate -
Wednesday, 12 Dec 1984

Vol. 354 No. 11

State Financial Transactions (Special Provisions) Bill, 1984: Second Stage.

I move:

"That the Bill be now read a Second Time."

The object of this Bill is to enable me as Minister for Finance to ensure the continued efficient operation of State financial transactions.

The measures in it are such as would be reasonable to cater for any temporary disruption or threat of disruption of the public finances. This need not necessarily be due to a strike but could be due to any other factor e.g., breakdown in a computer facility. It is therefore, desirable in the widest sense that this Bill be passed.

I propose now to refer to the provisions contained in the Bill. First, I wish to draw the attention of the House to two minor errors in the Bill as circulated. In Section 1 on line 22 of page 2, the word "Exchequer" is misspelt and in Subsection 2 (2) (c) on line 49 of page 3 the word "reference" should be in the plural and the comma after the word should be omitted.

Section 1 contains some necessary definitions. Provisions for commencement and termination are contained in section 2 (1). I would point especially to the provisions in section 2.1 (a) that before making any arrangements under the Act, the Minister for Finance will be required to be satisfied that due to special circumstances it is impossible to carry on business in the normal manner and may accordingly, in the national interest, make whatever special arrangements are deemed necessary.

As Minister for Finance I am responsible under the Ministers and Secretaries Act, 1924, for:

The administration and business generally of the public finance of Ireland and all powers, duties and functions connected with same, including in particular the collection and expenditure of the revenues of Ireland...

I wish to make it clear that it is the Minister for Finance alone who is responsible for the State's financial business. Many of the functions carried out by the Central Bank on a day-to-day basis are delegated to it for reasons of convenience.

The collection of the State's revenues and payments of the State's expenses are, rightly, the subject of careful statutory restriction. Article 11 of the Constitution provides for payment of all the revenues of the State into a single fund, known as the Central Fund, and payments into and issues from that fund are regulated by law.

Section 2 of the Bill provides, if necessary, for the introduction of special revised arrangements for operating the Exchequer and State accounts and for carrying out certain State financial transactions, and it is the purpose of the first important part of the Bill (section 2 (2)) to provide statutory support for these arrangements.

A statute which is particularly relevant in this regard is the 1866 Exchequer and Audit Departments Act. This old statute is still the basic Act governing much of the State's accounting practices. It sets out strict controls in relation to the lodgment of revenues to and the issue of moneys from the Exchequer Account involving the Comptroller and Auditor General in his capacity as Comptroller of the Exchequer. The Office of the Comptroller and Auditor General has been fully consulted by my Department in relation to the preparation of this legislation and that office agrees with the need for the proposed legislation. The Bill provides for my Department to consult with the Comptroller and Auditor General in relation to any arrangements made and it will be the intention of my Department to provide arrangements which satisfy him. The arrangements made will, of course, be subject to review by the Comptroller in the normal course.

The second important part of the Bill (section 2(3)) empowers me to postpone by order the redemption of, or the payment of interest or dividends on, Government domestic securities where I am satisfied that it is not possible to make such payments. During the Central Bank strike it will not be possible to make dividend payments on domestic Government stocks or land bonds listed on the Irish Stock Exchange issued before the commencement of the strike on 3 December 1984; or to redeem domestic securities falling due for redemption during the period of the strike, where the registers of such issues are held by the Central Bank.

Section 3 sets out the procedure for arranging for the redemption of, or payment of interest or dividends on, securities postponed under section 2 (3) when the situation returns to normal. A new date for the redemption or payment of interest or dividend may be fixed by me and this new date must be within three months of the end of the strike or whatever special circumstances required the postponement. The section also provides that interest will be payable on payments which were postponed and the order will specify the actual rate.

Section 4 provides for the laying of orders made under the Bill before each House of the Oireachtas and section 5 is the normal provision for administrative expenses.

To sum up, this Bill is necessary to:—

Enable the Minister for Finance to fulfil his statutory responsibility for the administration and business generally of the public finances; to ensure that he has adequate statutory support for such temporary measures as are needed to maintain operations on the Exchequer and other related accounts; to provide for payment of interest to persons who may be deprived of interest or dividends or repayment of capital owing to the temporary inability of the Minister for Finace to ensure payments.

Failure to take the proposed measures would cause very substantial disruption to the state's financial business and very considerable inconvenience — and hardship in many cases — to ordinary citizens. Even with the measures in place there could still be considerable inconvenience.

I commend this Bill to the House as a realistic and sensible measure to ensure the continued smooth operation of the State's banking and financial business.

This is an unprecedented Bill introduced in an unprecedented way to the House. It is indicated on the back cover of the Bill that it was presented by the Minister for Finance on 7 December 1984. That is a totally and utterly false statement on the cover of the Bill. The Bill was first brought to the attention of the Opposition in proof — not final — form on 10 December 1984 after I had returned from some very important consultations in which my party were engaging with the Irish Congress of Trade Unions. A proof form of the Bill was on my desk at six o'clock in the evening requesting a full debate on all stages yesterday, 11 December.

No copy of this Bill was available to anybody inside or outside the House until 11 December. Significantly also, no explanatory memorandum was available on what everyone acknowledges to be a highly technical and complex Bill and it is not yet available to any Member of the House. To say that the Bill was presented by the Minister for Finance on 7 December 1984 is a serious mis-statement and is not in accordance with the facts. It was not presented to the House until four days later and even then on the basis that we would have to deal with all stages in three and a half or four hours today, 12 December.

I agree with the reservations expressed by Deputy Mac Giolla and we would oppose this kind of action if there was any other option open to us. However, because of the Government's failure to deal with this matter in a proper, reasoned way, this House is now obliged to deal with unprecendented legislation in a hasty, rushed and totally unsatisfactory way without Members having any opportunity of considering the consequences of what we are obliged to pass here today.

It is quite extraordinary that in this term there has been little or no legislation in the normal course of Government business, but there is this exception. Many examples of emergency legislation of one form or another have been introduced in this rushed, hasty fashion, some of which had later to be withdrawn. Let me give the House some examples. There was the Copyright Bill, introduced because it was needed urgently to cover some loopholes in the law but withdrawn subsequently because it had not been properly prepared or presented. There was the Air Transport Bill introduced becase of emergency requirements to protect certain positions of Aer Lingus, but subsequently withdrawn because, obviously, it had not been given due consideration. We hardly need to mention the legislation required to liquidate Irish Shipping, the time given to it in this House and the unsatisfactory manner in which we were again forced to attempt — and it was hardly even an attempt — to discharge our role as legislators in relation to legislation of that importance rushed in without any background explanation or detailed information being given to this House.

Quite consistent with that we have today this Bill which the Minister may say was necessary to enable him to fulfil his statutory responsibilities. It can have far reaching consequences that may even now undermine the role of the Central Bank in relation to control of credit, our exchange control and our role, in particular, with the EMS. Whatever caused the necessity for this legislation should not have been allowed to happen. It is not my purpose to go into the question of the industrial relations dispute at the Central Bank. My colleague, Deputy Ahern, will go into that matter in greater detail. However, if as a consequence of Government directive, persuasion, influence, or pressure, the actual staff negotiations on pay and conditions of service in the Central Bank are being brought within the restrictive approach to the public service, then the Government are responsible for our having this emergency legislation brought in now.

Can the Minister assure this House that he or the Government have not in any way attempted to influence the Central Bank, which incidentally under the 1927 Currency Act is authorised, and obliged under section 31 (3), to conduct its own negotiations in respect of salaries and remuneration? That Act says:

There shall be paid to the Secretary and the other officers and servants of the Commission—

That is the equivalent of our Central Bank.

such salaries and remuneration as the Commission may determine.

Clearly, we must be assured that in approaching the need to vindicate the role of the Central Bank and its independent function — and it has independent functions which the Minister will recognise are enshrined in a statute, very important functions which Ministers for Finance time after time have pointed out — that bank would not be obliged to contravene the terms of the Currency Act of 1927 which says that those matters shall be determined by the Commission. We must be assured that the Central Bank were not in any way influenced, persuaded or directed by Government to apply the norms of the public sector pay negotiations within the public service. If that is what is happening there will be farreaching consequences of that directive.

This Bill will enable the Minister not just to ensure payment into and out of the Exchequer account, because obviously we all recognise that that must be done. We cannot see the whole machinery of State revenue and expendure in that sense being undermined. However, it goes much further than that and this is what the Minister has not said. This Bill will enable him to delegate the vitally important exchange control function of the Central Bank to a commercial, profit-making bank. One does not have to raise the question of the good faith or malafides of any bank, but it is quite clear that that function in terms of exchange control where large amounts of funds being transferred into and out of the country are subject to these exchange controls, for very obvious reasons resides with the Central Bank and not with any commercial bank.

This function resides very obviously with the Central Bank because commercial banks are in the nature of things in competition one with the other. One or other of the commercial banks will now be given that delegated function for as long as this Bill remains in force. There we are certainly moving away from what was always intended under the Central Bank legislation and even going back as far as the legislation to which the Minister referred — the Exchequer and Audit Department Act of 1866. There are very good reasons for this independence and for the Central Bank's fulfilling its function within fiscal monetary control and being the only body to have that authority. The Government should have done everything possible to head off a situation in which that essential function of the Central Bank is now being necessarily transferred to a commercial bank.

Does the Deputy mean that they should have given in — yes or no?

No, I do not. Deputy Kelly can make his contribution, but nothing that I have said suggests that. Giving in to whom? Deputy Kelly may explain afterwards what he means by that. Is he suggesting — and perhaps he is — that the Government were somehow parties to this industrial dispute?

Has the Deputy got an opinion on that industrial dispute?

I do not know what the Deputy means by giving in.

Has the Deputy got an opinion on it?

Each Deputy must be allowed to make his contribution uninterrupted.

What about the poor man looking for his money on 1 January? God help him.

That is why we have this Bill.

This I do know, if the Deputy wants to have my opinion and I have said this many times before. This Government took this tunnel view and narrow actions in respect of, for example, their borrowing programme. They took a decision that they were going to adhere to certain rigid limits in terms of domestic and foreign borrowing and did not even seem to have the capacity to see how that would distort our whole internal money market and give rise, automatically, to interest rate increases.

This is another example, in my view, of the same risk. They bring in this emergency legislation four days after they said it was published and we, the legislators, will get only three-and-a-half hours to deal with it and do our job as legislators to ensure that it is all done according to law. They have not thought out what options there might have been to ensure that this legislation, with its consequences, would not have been necessary. Someone might say that before the Central Bank legislation in 1970 the Bank of Ireland had this kind of role in any event, the 1970 legislation stating that the power resides with the Central Bank; but at that point we did not have the exchange control and certainly did not have the sole responsibility of the Central Bank in retaining the position of the pound within the EMS. The primary function of the Central Bank in that instance — this cannot be discharged by any commercial body — is to maintain the value and exchange rate of the IR£ within the system. This involves the preservation of the position of our currency relevant to the EMS constituents. This is an essential function of the Central Bank since we joined the EMS system.

Major foreign currency dealings are conducted through the Central Bank as are Government dealings in the foreign exchange business. The transfer of these accounts to other institutions seriously undermines the process of maintaining the currency to the extent that we do not even have an official quotation for our currency from the Central Bank. That is an immediate consequence of this industrial dispute but it is also a consequence of the fact that action was not taken much earlier to head off a dispute of this nature and ensure that the provisions of the Currency Act, 1927 which require that these matters be determined by the Central Bank were complied with. We have no official quotation as to the exchange rate of our currency within the EMS. For those who wish to buy other currencies it is a question of taking a leap in the dark. I am sure the banks will work on some kind of a guide. However, it is an essential function of the Central Bank to provide such a quotation and this Bill cannot deal with that. Everyone will recognise that this is, to say the least of it, a very sorry state to be in.

In the course of his short statement the Minister did not deal with any of these implications. The Minister for Finance has a statutory function in relation to the management of our finances. I thought he would have pointed out some of the difficulties that will inevitably arise. As regards the management of our official external reserves, the transfers of these accounts under the proposed legislation will impede the management of these reserves because the monitoring of Government foreign exchange dealings will be extremely difficult. The Government's foreign exchange dealings have been transferred from the Central Bank to a commercial institution. The lack of experienced personnel in the Central Bank as a consequence of this strike means that the investment of the official external reserves is not being correctly managed. That is a matter which the Minister for Finance with his statutory role and responsibility must be concerned about. It could mean that the bank are losing vast sums of money every day on their investments. The Minister said nothing about this.

The Bill was introduced just as if it was a question of arranging to have the Exchequer account managed so that we could make payments into it and get money out of it but the Minister said nothing about the fundamental role of the Central Bank in the areas I have mentioned.

As a result of this strike, no credit information or monetary information is being compiled. That is a matter which will have serious consequences. This means that the Central Bank are no longer able to monitor credit data at a time of high seasonal demand which this year has been accelerated by the inordinate demand by the Government for money from the domestic money markets. No one is monitoring the control of the credit demand at this time of high seasonal demand and when we have the all-embracing, consuming appetite of the Government on the domestic market.

In relation to the dividend payments on existing Government stocks this legislation — the Minister says necessarily — invalidates the contract which the Minister for Finance entered into with ordinary citizens. The Minister may say it has to be that way but that is what it does. Over 200,000 investors who supported Government fund raising projects in the past have already suffered considerable loss through the rise in interest rates. Now the deferment of redemption payments will seriously undermine public confidence in Government stock investments. We cannot accept, as is suggested in section 3, that at any time when this strike is over — the Minister had an interesting reply to make to Deputy Connolly yesterday which seems further to confirm the purpose of the section — the Minister will then determine the rate of dividend payments and interest on these dividends in respect of the period during which the strike took place. In the reply the Minister gave to Deputy Connolly he said that on the cessation of the strike, arrangements would be made for the payment of those interest or dividend amounts which have necessarily been postponed. He said payments would also be made on amounts due in respect of securities. Then he said that in all such cases interest at a rate to be determined would be payable on the amounts in question in respect of the period of the postponement at a rate to be determined.

That is very vague.

At a rate to be determined by whom? From this legislation it appears to be by the Minister. Surely it would have been reasonable for the rate to be determined by the Central Bank. They should be the arbiters of what should be the appropriate rate not just to compensate but, in equity, to make up to those who have been deprived of their dividends, payments and entitlements under contract. It is being left on the basis that it will be determined by the Minister.

We have a very limited time to discuss this Bill and I know my colleagues wish to contribute. We will insist, however, that a time limit be put on this proposal. The Minister may say that it is not possible or that he is not prepared to do it. We will be putting down an amendment, which we hope the Minister will accept, which will ensure that the interest rates to be paid at the termination of the strike will be determined objectively — not just by the Minister as he might determine — having regard to the rates which have been applicable during the period. Our view is that it is the Central Bank alone whose function is being undermined in this legislation, not deliberately perhaps, nevertheless as a consequence.

It is a matter of great regret to all of us that we must have legislation of this kind coming in as it has come in. I am sure it is a matter of concern for the Minister. The Central Bank has fulfilled a very important role. Their staff are expert in areas where only they have been dealing. Their whole grading structure indicates that they are not in any way in line with public sector grades. There are grades and responsibilities in the Central Bank which do not exist anywhere in the public service and vice versa. Their functions as bankers to the Government and to the banks, as lenders of last resort and regulators of the money market, the Minister will recognise at least as much as I do, are essential.

I regret that this kind of emergency legislation must be brought in here just to protect, apparently, the income and outflow from the Exchequer account. It is doing much more than that. What is here now as enabling legislation could be on the Statute Book forever and could be implemented by order whenever. I hope that that will not be the case and that we will put a time limit on this which will make it appropriate to the need of the occasion. Secondly, I hope that we will deal with the other matter I have suggested in terms of the contractual obligation to Government stockholders.

I want to begin a fairly short speech by saying that what I have just heard from Deputy O'Kennedy is of a piece with the financial advice which he has been giving the electorate over the last several months. He is not alone in that. The rest of his party, so far as they are competent to do so, have been joining him. It is all criticism but no suggestion as to how the thing might otherwise have been done. I do not single out Deputy O'Kennedy in any way. Perhaps he is not by any means the worst. He just happens to have spoken this morning, and he spoke recently on another financial matter. Only a week ago I heard him say in regard to the rise in the bank rate that it was all the fault of the Government because the Government had borrowed too heavily, in the domestic market, thus, since money is a commodity when it is short the price of it — which is interest — goes up, thus leaving too little for the private borrower, thus pushing up interest rates. I have not heard that anybody took Deputy O'Kennedy through his point of view and put these matters to him, but the insinuation there was that the matter of domestic borrowing was entirely black and white, that to have borrowed domestically instead of abroad was something in favour of which nothing could be said or so little by comparison with foreign borrowing that it did not deserve discussion.

Deputy O'Kennedy was Minister for Finance for a period and he knows perfectly well the difference between domestic borrowing and foreign borrowing. Either course has disadvantages, but foreign borrowing has colossal disadvantages. The foreign borrowing indulged in by Government over the last decade has been responsible largely for leaving us in the condition out of which this Government are trying gamely to fight their way.

That sounds like last week's debate.

(Interruptions.)

Order, please. I ask Deputy Kelly to bear with the Chair for a moment. I do not wish to appear to be curtailing any Deputy on either side of the House, but let me point out that this obviously is not a general financial debate.

I accept that, but I wanted to draw a parallel——

On a point of order, a good many speakers want to come in on this debate. Is there a timetable for the speakers? I do not wish to be rude to Deputy Kelly or any Member, but a good many speakers want to come in. Is there a time limit on each speaker?

The only time limit on the speeches should be the realisation of Deputies that they have made an order under which this item must conclude at 4 p.m. That is not as long as it appears. Two hours will be taken out of that time which means for all practical purposes that it is concluding at 1.30 p.m.

Perhaps Deputy Kelly should confine himself to the issue.

Leave that to the Chair.

If the sense of Deputy Connolly's interjection is that the Minister should be left here like one of the figures in a fairground barrel 50 years ago as described in Fiche Bliain ag Fás at whom people on the far side are entitled to throw blocks, without anyone throwing any back, that is not what I consider debate to be all about. I will not speak for more than ten minutes, but I want to say that nothing that Deputy O'Kennedy has produced here contains a tittle of a suggestion as to what else the Minister might well do. It is a Second Stage debate so far, and possibly we will hear from the Deputy or his advisers on Committee Stage, but the Second Stage contribution coming from that financial spokesman, that alternative Minister for Finance, that shadow chancellor of the Irish Exchequer, reveals not a single idea in his head about how this crisis, this emergency, is to be confronted. He insinuated that the Government are at fault somehow in not having “headed off” the industrial dispute which closed the Central Bank. He refused to give an opinion about the industrial dispute itself, because the industrial world for Fianna Fáil is becomming analogous to sub judice. It is sub industrial dispute, so we must not say “Boo” to either side, no matter how strong one's opinions may be. His insinuation was that the Government were in the wrong. I asked him to say where the Government were in the wrong on the dispute, and he ducked that with all the eel-like skill which 25 years' membership of the Fianna Fáil Party would make second nature to him. Nonetheless, he was willing to lambast the Minister for having brought this situation to pass.

It is not just Deputy O'Kennedy I complain about; this is true in regard to all of the Opposition, and people on this side can be guilty of it also when we are over there. He had not it in him even to say that the Minister is not to blame for the emergency which the State financial apparatus is now facing, and that if he can help the Minister to put it right by making constructive suggestions then he will make them. The Fianna Fáil Party are not short of tycoons, bankers, people who know what big money is all about. That is why they are in and supporting Fianna Fáil.

You have a good few in it too.

There is no shortage there of people, who deal in strings of noughts as long as your arm, to advise Deputy O'Kennedy about what might have been an alternative way of facing up to this crisis. That the notice was short I accept, and also that Deputy O'Kennedy had this Bill before him for less than 48 hours. That may be so, but 48 hours is time enough to get advice from the kind of people who are available on matters such as this, and Deputy Connolly, Deputy Ahern and Deputy Brennan know that. They are doubly available to a party such as Fianna Fáil, who go out of their way to conciliate those sectors by promising them anything which their own shortsightedness does not lead them to see is going to plunge the country deeper into hardship five years further on if they are given the chance to put it into effect.

Every reason given by Deputy O'Kennedy why the Central Bank should be left with its functions unimpaired and why this legislation should not pass seems equally strongly to argue for a proposition which he never approached within an ass's roar of. That is: that certain public functions vital to the people should be outside strike freedom altogether. Hundreds of thousands of people in the country who vote for all parties know that in certain vital functions the ordinary freedom to strike should be suspended by contract or agreement or as a point of honour. In saying that I am making no comment on this dispute or on either side in it. I must admit that I am only dimly instructed about it. However, every reason given by Deputy O'Kennedy for the necessity to leave functions with a bank which has effectively closed its doors is the reason why that strike should not have taken place. A similar thing could be said about a very large range of other disputes which bring other closures in other parts of the public sector which are injurious, not to capitalists or to the system — as I am sure Deputy Mac Giolla will tell us — but injurious to the public of which he and those who vote for him are members also. I should like to know what Deputy O'Kennedy thinks the Minister might have done. I am not an expert on public finances, so I cannot say whether the mechanism he has chosen represents the one best calculated to serve the object which it is his statutory duty to support. I will not judge that; but not a word I have heard from the Opposition spokesman, or shadow chancellor, enables me to judge that mechanism any better than I could have done half an hour ago.

Do the Deputies on the other side imagine that it would be possible to leave the State in the same condition during the Central Bank strike as they left it during repeated strikes of the commercial banks? I recall the late Deputy Colley when he was Minister for Finance, in the fifth month of a national bank strike, having no ideas about what might be done if the banks never reopened. There was no hint from the then Government that an effort would be made to adapt the Post Office system into a rudimentary banking substitute, or of trying to start what I am sure Deputy Mac Giolla would have supported — a State banking system, which would have been wound up as soon as the commercial banks came back into operation. The result was that, in the late Deputy Colley's picturesque phrase, people "wrote their own credit," kept issuing bits of paper which were dishonoured when the banks reopened. That had the effect of ruining many people. On three occasions in the past 12 years the public have had to endure bank strikes, one of which was extremely prolonged and which caused enormous hardship. But there was no suggestion from the Government of the day as to what might have been done to break that strike, if I may use that ugly phrase.

I do not have anything against people who in the normal course of industrial relations assert their rights; but we must remember that the public come first. Their interests are more important than Fianna Fáil. They are more important than Fine Gael. The interests of the public are more important, too, than any union or any number of unions. Every trade union member himself depends on a huge range of public services, just as those of us who are not union members depend on those services.

I am not qualified to comment on the strike in question but this whole area is one that politicians have fought shy of for far too long. I have read about a time when Fianna Fáil had far more guts than they have now. If one were to shake them today one would hear a farthing rattle around their insides, they are so devoid of guts.

In 1941 the late Mr. De Valera and the late Mr. Seán McEntee were not afraid to introduce a Bill limiting the number of unions to one per trade. That was a regulation of the right of association but the Supreme Court ruled — wrongly, in my opinion — that it was a denial of the right of free association. That was in 1945, and we have not heard anything about legislation of that kind since. It was an effort by the Government of the day to save the country's industrial structure from the disruption which the proliferation of unions was causing even then, and which now has gone beyond all limits, as anyone who is not afraid to say booh will recognise.

Naturally, we will not hear anything in this regard from the Opposition, because they are putting their weight behind the ICTU in the hope of luring disillusioned Labour voters. If I have the opportunity during the Adjournment debate, I shall have a good deal to say about what Fianna Fáil have hooked themselves onto in support of the ICTU document and on its doctrines and programmes with which they must recognise themselves to be identified. I do not believe that even 25 per cent of the people in Fianna Fáil have read that document.

To some extent we are all guilty of fighting shy in this whole area of industrial relations but that can be said of Fianna Fáil more than of any one else. We are not talking about an area that is sacrosanct. There is no sacrosanct area of legislation in this country. The State is proposing to stick its nose into people's business in their own businesses, their own property, their own homes, in how they rear their children and in every other area. I do not see why industrial relations should be a no-go area for this House, for the other House or for the President. We are talking about the governing body of the people of Ireland, irrespective of membership of trade unions.

Deputy O'Kennedy says that what the Minister is doing "invalidates" contracts made by the Government with their investors. That was a well chosen phrase. What is happening may frustrate those investors. That would be the correct term to use. The arrival on the scene of a cause from outside, in this case an industrial dispute, may frustrate the discharge by the Government of their contracts with their investors, but that should be said plainly. The Government have not broken their contract and do not propose to do so.

Deputy O'Kennedy's last remark which he appeared to consider to be his best point, judging from the flourish with which he led up to it, was that the phrase, "the rate of interest would be determined" might mean that investors would receive only an arbitrarily chosen and perhaps derisory return of interest on payments that will be overdue. Obviously, the Deputy intended frightening investors into believing that that will be the case. He should know that the State cannot pay something less than what is a fair rate of interest. To do so would be confiscatory. It cannot be done in a free country, or within the terms of a Constitution such as ours. I do not mean to prejudge what rate would be appropriate; but the Deputy is wrong in trying to frighten investors into believing that Government would pay a rate of something like 2 to 3 per cent.

I trust we will hear more of Fianna Fáil's ideas about this dispute, and about disputes of this type generally, as well as what alternative they might have to this legislation, when other speakers from that side address the House.

Deputy Kelly wandered a good deal but I suppose that living in a metropolitan area he is in cloud cuckoo-land in many respects.

I wish to deal particularly with section 3 of the Bill because it appears to have far reaching consequences for investors. Thousands of people are due interest on land bonds on 31 December this year. The money is paid on 1 January. I have tabled a parliamentary question in this regard for written reply and I have done so as a result of having being approached by constituents on this matter. Two of those with whom I spoke outlined that they had entered into commitments with builders and with builders' providers and had given undertakings that on 1 January they would be able to honour those commitments as a result of the dividends that were due to be paid to them on that date. Those commitments are now in a shambles.

In those circumstances where do the small builders, the builders' providers and other business people stand? What is happening could result in some companies going to the wall. They are depending for cash flow on moneys which apparently will not now be paid. Nobody here would be foolish enough to think that contracts are not entered into in good faith in relation to houses, farms and so on. Now investors will not be able to meet their financial commitments on 1 January. Could the Minister not make an arrangement to deal with that situation so as to pay investors their legal entitlements on 1 January? The Minister is looking for a deferment and in reply to a question I put down in the Dáil the Minister was vague about the terms of interest. The interest rates should be spelt out. Will the interest rate be 16¼ per cent as it is on some land bonds and other Government securities? That is something I and my colleagues will want to know about. I agree that some arrangements have to be made but I am perturbed about some cases that have been brought to my notice where people will find it difficult to meet financial commitments. These people could take action against the Minister for Finance if their money is not paid on the due date. Government securities were always reckoned a safe investment. What will investors, shareholders and others think if their money is held up for a considerable time and if commercial companies are looking for their money in January and cannot get it. Many companies have gone into liquidation and have brought others with them and now there will be a stop on the cash flow which is badly needed to sustain the industrial life of the country. When replying will the Minister say if some arrangements can be made for the people who invested in good faith? The Minister should be able to make some arrangement with the commercial banks who will now be taking over the role of the Central Bank.

I am not clear whether the Opposition are in favour of or against the Bill. Deputy Connolly's contribution has been opposite to the contribution made by their spokesman on Finance.

To create the impression that the Minister for Finance is responsible for what is happening in the Central Bank is not right. That problem is caused by a trade dispute. What we should be concerned with are the measures being taken to give the Minister for Finance powers to deal with this situation. That is part of the role of the Minister for Finance. This is not a complicated Bill but so far we have been discussing a Finance Bill rather than a simple measure to allow the Minister to carry out his functions. In giving the Minister these powers I would be concerned that it be seen that Dáil Éireann is not giving the Minister the right on our behalf to be a strike breaker. We should not be seen to be making a precedent which would be seen by the trade unions to be strike breaking. I would like the Minister to say how he proposes to deal with the movement of cash from the Central Bank and what staff will be employed to carry out this function. Would people now employed at senior management level carry out this function or do the management in the Central Bank propose to take in staff? Will we make the bank situation worse by doing this? Only the absolute functions of the State's finances should be dealt with in the course of this dispute.

From listening to Deputy Kelly one would have thought that a trade dispute should not have a side effect but no matter what trade dispute is involved it creates inconvenience to the public. It should be remembered that the main inconvenience is caused to the people who are on strike and to their families. I am horrified that people talk about trade disputes as if they were illegal. A trade dispute is as legal as actions taken under other legislation. The right of people to withdraw their labour is a fundamental constitutional right which we should safeguard. As long as people go on strike in accordance with the law of the land they are upholding democracy and not tearing it down. I am horrified at the way some people talk about the strikers and their effect on the public. The farmers went on strike in a democratic and legal way when they wanted their rights and trade unionists go on strike to achieve their rights. There is nothing wrong with that.

I would like to be reassured that the measures being taken will not be seen by the trade unions as an attack by Dáil Éireann in order to smash a strike. I wish to be assured that this will only be a temporary measure which will not be used as a precedent in other disputes that may occur in banking institutions or elsewhere in the public service. I entirely agree with the point that has been made in relation to the last bank strike. On that occasion the whole finances of the State were left in somewhat of a heap because as a result of the dispute many people suffered severely, not during the strike — strange as it may seem, many people had a ball in that time — but after the strike. People found they had lost their life's savings not as a result of the strike but because of lack of control or direction at Government level of the operation of financial transactions.

The Minister may be able to tell us if he is aware of any efforts that were made to try to resolve the dispute which would have avoided the necessity to introduce this Bill. At one time I was responsible for a section of a banking institution as a trade union official and I know it is not always easy to get satisfactory agreements in that sector. Perhaps the Minister might look at that in consultation with the Minister for Labour. In an essential service, proper arbitration and conciliation machinery should be available to deal with industrial disputes in a concentrated way. Very often, people like those in the Central Bank would come to the conclusion that a threatened strike would not happen, that some fairy godmother might hand out something to avoid the strike. There is a lot of brinksmanship in that sector and it has been there for many years.

Therefore, when this dispute is over the arbitration and conciliation machinery in the Central Bank and the method of negotiation should be re-examined because I suggest the Minister's portfolio will come into this more and more. I ask the Minister to reassure us that this Bill is essential and that it is not being used and will not be used in any way to interfere with industrial relations in the Central Bank and that the legislation will not be abused in order to interfere with or break what is an officially and legally constituted strike.

I echo the point made by Deputy O'Kennedy — I have made the same point many times in the House as Government and Opposition Whip — that it is totally unfair to the Opposition to be subjected to certain Departments coming up with this type of legislation in the last week of a session. Unlike Deputy Kelly who can master these things in a few hours I do not have the ability to do so. I do not know any of the millionaire advisers Deputy Kelly spoke about, but then I am not a professor and I do not frequent the sort of places those afternoon people go to. That is obviously why Deputy Kelly holds the views he expressed on strikes and industrial relations and senior advisers in banks. The rest of us politicians in Opposition do not have access to those academic millionaires Deputy Kelly referred to.

The Bill is dated 7 December, so some people had it last week. It was printed on Friday but the Opposition merely got a proof. I am not blaming the Minister for Finance, but this practice is unfair. Today I am involved in two Bills, this one and the Social Welfare Bill in regard to which the Dáil has been given similar treatment. It is a very shabby way of doing things. Having been Government and Opposition Whip I know exactly why this practice exists. Certain Departments, one in particular, hold back Bills until the last moment so that they may be able to get them through quickly because debates will be limited. I have said it is not the Minister's fault. The Department of Finance through the years have been very good at this practice, but other Departments have nearly equalled them. In the last session an attempt was made to push through the Air Transport Bill on the second last day at a time when the Minister was out of the country. The Minister of State admitted that he had not read the Bill but he tried to ram all Stages through.

We will have a Bill at the end of this week which can be introduced at the last minute.

I accept that, but the Transport Bill came in on the second last day of the last session and had to be pushed through. The Minister should try to do something about it. I tried some time ago, and I succeeded in stopping the practice in some Departments. The Minister spoke about computers breaking down and said that is the reason why this legislation might be needed in the future. That was a real try-on by the Minister because would it not have been better to fix the computers than to draft this complex legislation? The real reason for the Bill is the trade dispute between the Central Bank and the staff. The Minister has said that under the Ministers and Secretaries Act, 1924, he needs these functions. I do not say that he can do otherwise and therefore we will not be voting against giving a Second Reading to the Bill. We are a responsible Opposition.

In his usual rambling speech, Deputy Kelly asked what was the alternative to this Bill. My reply is that the Minister should not have asked to come here today with this Bill. The strike should have been avoided. In a Private Notice Question last month I asked the Minister for Labour if he had considered the serious consequences of this strike for the national economy and what steps he proposed to take to avoid the threatened strike of the 450 staff in the Central Bank. The Minister for State told me that the union involved had made a claim for a 15 per cent increase. An offer of 3 per cent with a seven months pause in accordance with Government pay guidelines had been made and the offer had been rejected.

Here there has been obvious interference by the Government to ensure that the terms of the national plan would be followed in the Central Bank dispute. Last month the Minister of State said the Government would not get involved. He said that until now section 31 of the 1927 Currency Act had given the Central Bank a unique statutory position which entitled them to negotiate pay but that that had altered in some way. Of course, the official answer is that the Central Bank made up their own minds, but from my experience in dealing with trade unions and disputes it is clear to me that there was massive interference. To find who is guilty of such interference is a difficult job. I met the full council of the Labour Court and heard their views. I had a good discussion with them. As far as possible they are trying to uphold their independence. I am sure the Central Bank will do the same.

Decisions are being made consistently in the public service and in a number of other areas where the public service have influence which are obviously being dictated to certain people. I have already said that is leading us down a very dangerous road. Deputy Kelly seems to be talking about something that happened 20 years ago. There is no question of anyone being afraid to say anything to the unions. Our party had a good, straight talk with them the other day. It is not a question of running away. When the process of free collective bargaining which was fought for for years is interfered with and undermined, and when undue influence is exerted on people who negotiate, that is fundamentally wrong. In Government Fianna Fáil had difficulties about free collective bargaining but it is wrong to interfere with it. This House should not do anything which makes free collective bargaining more difficult.

This Bill does that indirectly. The Minister has to carry out his functions and I support him in that because otherwise he would not be doing his job. If the Minister for the Public Service was not running the country into industrial chaos this would never arise. That is our argument against the principle of this Bill. Confrontation is building up in a number of areas, and this is one. The entire public service area came under threat in a number of cases such as Irish Shipping and the Land Commission and there is alleged interference in several other cases. They went before the Labour Court and decisions were made. Others are awaiting reports and recommendations from the arbitrator.

They are all getting into unecessary difficulties. This requires the Minister for Finance to bring in legislation. The Minister would prefer the 200,000 people to get the benefits and dividends to which they are entitled. Some of them badly need them. People invested in what they thought was the last safe place. The Minister for the Public Service does not see it that way. He goes down the road of aggressive action, confrontation, no conciliation. He had to be forced into appointing an arbitrator in the face of a national strike on 3 October. All these things are building up resentment.

I will give a few quotations. In 1980 the Minister said that the Government did not propose to interfere with the administration of the Central Bank which would be independent in carrying out its functions. He said this independence was possessed by almost every central bank in the world and it was a very desirable provision. That was said by a colleague of my own. In the Dáil debate in 1980 Deputy Garret FitzGerald endorsed what the Minister said about the role of the Central Bank and stated that there would be a grave danger for our currency if the role of the Central Bank was undermined. Deputy Peter Barry said at that time that everyone in the House would ageee that the Central Bank should not be interfered with in any way by Governments or politicians. He said it must be independent.

This is taking away their independance. The Minister is doing that for a reason. In our amendment we are asking the Minister to do this for the duration of the strike only. We know that industrial relations problems are the reason for the Bill. There is no need to try to cloak that. Nobody denies that the Minister has to carry out certain functions. This Bill should be taken off the Statute Book on the day the industrial problems are solved. If the Minister does that, he will be doing a good day's work. This is emergency legislation and it should be dropped as soon as the difficulty is over. If the computer breaks down and the Minister needs the Bill again, we will put it through on the nod. The Minister is having no difficulty today even though in principle we are against his reason for doing it.

The staff of the Central Bank are being treated unfairly. Successive Governments in recent years have followed fairly stringent guidelines and there have been holdbacks and cutbacks. The staff of the Central Bank have lost substantial increases and pay benefits. They have lost from 17 per cent to 27 per cent. They did not receive special increases which were given to the generality of the public service. Arbitration decisions given in favour of the Civil Service were not given to the Central Bank employees. It is unfair to say they are linked to the national plan and the Government guidelines. In the negotiations with the Central Bank an attempt was made to link them with certain analogous grades. Their representatives disputed those grades. The staff wanted to have a say in regard to which grades were analagous.

The Leas-Cheann Comhairle was a good trade unionist in his day and I am sure he would say that was not unfair. This group of responsible and respected people, from clerical grades to economists, do not want to be involved in industiral action over the Christmas period. They are not the type of people who are unruly and who try to bring down financial institutions. The employees of the Central Bank give an excellent service. They work in difficult circumstances and under pressure. They are not paid inordinately high salaries. They did not get some of the increases and the perks which employees of other banking groups got over the years. We are not dealing with an elitist group of 400 employees. Quite a large number of them are females on very low salaries and in grades earning under £100 a week. It is not a case of these people having to be set up and taught a lesson.

This Bill will be passed because the Government have a majority. We will not oppose the Second Stage of the Bill. We will wait to hear the Minister's comments on Committee Stage. When the Bill is passed I hope the Minister will urge his colleague, the Minister for the Public Service, to speak to the people in the Central Bank and to release the constraints which obviously he has put on them. He has taken away their power to follow the provisions of the 1927 Act. He has taken away their right to co-operate with a large responsible trade union group and to participate in free collective bargaining in the normal way. The employees looked for 15 per cent and they were offered 3 per cent. If the principles of free collective bargaining had been adhered to, I have no doubt that a settlement could have been reached and analagous grades, which are at the centre of this problem, could have been found.

It is a little strange that, while the Central Bank could not negotiate with the clerical staff of the ASTMS, they went ahead and the Irish Printing Federation agreed to give a 9 per cent increase in two phases over 15 months after a four months pay pause. They are committed to maintaining relativity between 48 security guards and security guards in the associated banks. The increase in that area is 10 per cent over 15 months.

It has been stated to the staff at present in industrial dispute, who are now in their second week marching the streets coming up to Christmas, that the banks' 24th pay round must remain, as indicated, a seven months pay pause and 3 per cent from 1 January next over an 18 month agreement. This is contained in a letter written by the Central Bank stating that that must be the position and there is no need for me to repeat it at length. The Department of the Public Service have said that the pay guidelines as laid down in the national plan must be maintained in the case of the Central Bank staff because they should set a guideline to other workers. But while there are 450 people marching the streets we are here discussing unnecessary legislation, legislation which can be dangerous in certain respects.

Deputy Bell made a valid point in that respect. If we were to arrive at a situation — and we have seen this happen in the case of companies not too far from here — that every time there was an industrial dispute the Minister present, for valid reasons under his powers and functions brought in this type of legislation, such could become a vehicle to beat disputes in other areas — in other words, that the solution is to introduce emergency legislation, rushing it through this House. That is how one beats certain classes of workers. There may be a temptation for people to do so in other Parliaments. I hope this will not be only the first of such instances here. I accept the Minister's reason for doing so on this occasion but not those of the Government because they could have done something about it while the Minister could not.

There are others who wish to speak. I must contend that the Minister for the Public Service and his officials obviously are not concerned because neither he nor the Minister for Labour has bothered to enter into any part of this debate though they are the people directly responsible. Rather they have sent in the Minister for Finance to the House today. Perhaps even some of their officials would examine what has been said in the course of debates, endeavouring to bring this industrial dispute out of its present deadlock, which I believe can be done. I believe that some little discussion on analogous grades could break the deadline if the rope was taken off the Central Bank, if they were allowed continue in the normal way, following the guidelines they have been following for 55 years, following the normal free collective bargaining pattern.

They should be allowed to follow what has happened in allied institutions such as building societies, insurance companies and other banking institutions. Were they allowed to follow the pattern followed in those institutions, this dispute could be ended tomorrow morning. I accept that the Minister for Finance cannot do that but it could be done by the Minister for the Public Service by way of a telephone call from Government to the Central Bank. If there is no such breakthrough effected these unfortunate workers will be placed in the position of having to continue their industrial dispute. That would be unnecessary action for them, causing unnecessary difficulties to investors and all of the other problems outlined by the Minister for Finance today and mentioned by several Deputies.

It does not seem much to ask that in the week before Christmas the Minister for the Public Service could at least do that. Obviously he will not win his battles on his 3 per cent. Obviously there will not be an arbitration decision of 3 per cent. Why not at least endeavour to offer 9 per cent or 10 per cent to these workers overnight, agreeing that analogous grades be taken into account, which I believe would lead to a breakthrough. There should be discussions carried out in line with what the Central Bank has done, accepting relativities with the Irish Printing Federation, with the security guards and the associated banks. If they can do so in one area why not in another? There is an inconsistent approach being adopted. That is because of Government interference in the process of free collective bargaining.

Hopefully the provisions of this legislation will continue merely for the duration of this strike. I would ask the Minister for Finance to use his good offices to convince the Minister for the Public Service not to continue down this disastrous path rubbing salt into various trade union groups, in an endeavour to win an argument he must know he has not a chance of winning, by endeavouring to set unrealistic and unfair guidelines, forcing workers out onto the streets, leading in turn to other industrial disputes in, say, local authorities, which will be the next to arise. They can be avoided. I want to see them avoided, the Minister for Finance wants to see them avoided and so does the country at large. In the midst of our current economic difficulties we cannot afford such major industrial disputes. The reason they have been brought about is the tough, unfair and unreasonable attitude adopted by the Government, through the Minister for the Public Service, forcing his colleagues rather than himself to introduce fairly dangerous legislation if allowed to remain on the Statute Book for too long.

In these the last few days before the Christmas recess I hope we shall be given some assurance that this will not be the path we shall continue.

I should say I resent the inferences contained in Deputy Kelly's remarks about our discussion with the Irish Congress of Trade Unions. We are entitled to talk to whomsoever we wish. We are entitled to accept whatever principles we wish. Deputy Kelly may wish to drop out of Government, to revert to the back benches and to pontificate on all types of policies and all sorts of matters, at times being totally irresponsible and at other times being responsible. We are a large Opposition party, an alternative Government. We are entitled to talk with the FUE, with the Irish Congress of Trade Unions, with the Irish Farmers' Association or anybody else. I resent anybody challenging our rights to so do. We did not make any major statement. We said we agreed with some of the principles contained in the Irish Congress of Trade Unions' document. Everybody in the country agrees with those principles. It is what is done about them that is important and it is to that end we shall continue to direct our efforts in order to arrive at some solutions to our unemployment problems.

This will not be achieved by dictates of Government or through their interference in the process of free collective bargaining, introducing emergency legislation, allowing semi-State companies to go down the chute, even to the extent of allowing other civil servants in the Land Commission to go the same way. That is not the way to solve our problems. If the Government feel they must bring in a few backbenchers to support that type of legislation from any onslaught, saying anything and everything, then that does not constitute very good government. Yet Deputy Kelly accuses us of not engaging in very good opposition.

I have said that we shall not oppose the Second Stage of this Bill. We see that the Minister for Finance has a function to play. But that should not prevent us from putting forward our point of view, which is that we should not continue to travel this path. Rather we should endeavour to persuade the Government to accept some of our amendments. If one were to follow Deputy Kelly's line of argument then it could be said that we should all go away, allowing the Minister for the Public Service to run the country subjecting everybody in the State and semi-State areas to various dictates. We would then arrive at a position some time in 1985 when there would be no civil servants remaining, whether they be public servants who do not wish to become involved in industrial disputes, staff of local authorities or those of the various health boards. This is the path we are beginning to follow, but one we must not continue to follow. The Minister's only alternative, which is to introduce emergency legislation within 24 hours, constitutes a dangerous and frightening pattern. The Government will have a few weeks over the Christmas recess to think about that, and about changing that pattern very quickly.

It is amusing to hear Deputy B. Ahern speak so sincerely, honestly, almost cravingly, that certain things be done. The reason the Minister and the Government have to travel certain roads in regard to Government pay guidelines is very simple: it is that Deputy B. Ahern and his party placed public finances in such a state that we cannot now afford to do what we would like for our public servants. Indeed, we would have more public servants employed if there had been a more responsible attitude shown by the people who had the responsibility then for managing public finances.

Deputy B. Ahern spoke about Fianna Fáil being a large Opposition party entitled to meet with the Irish Congress of Trade Unions. I should say that they are entitled to do whatever they like. But they should not endeavour to deny the rights of Deputy Kelly and me to criticise the Opposition party and the Irish Congress of Trade Unions or, for that matter, anybody else we feel fit to criticise if we believe them to be wrong. I shall do so on behalf of the people who elected me here. I believe it constitutes a gimmick on their part ——

A Leas-Cheann Comhairle, on a point of order, that is the very point I made: that Deputy Kelly was questioning our right to do certain things.

That is not a point of order.

The Deputy is now saying that he and others want to put forward their points of view ——

Deputy Ahern's argument must not hold much weight when he has to repeat it.

I feel very strongly that the time has come when we must all recognise our right to put forward our points of view as we see them. It is only through putting our points of view honestly that we can achieve some sort of consensus as to where we should be going. With regard to the meeting between the Fianna Fáil Party and the Irish Congress of Trade Unions, to some extent, we do resent it because the very same Congress have not even the courtesy to extend to some Deputies a facility to brief them, for instance, on their attitude to taxation. Only some months ago when the farmers were on the warpath the ICTU held the opinion that it was better for them to remain aloof from political parties and politicians and to deal only with the Government on formal matters. I do not know how this change came about.

I understand that Congress will be inviting the Fine Gael Party as well.

I do not want to hear any of Deputy O'Kennedy's points of information.

It is a matter for them to go if they want to.

I have the floor and Deputy O'Kennedy can speak later if he wishes. If Deputy O'Kennedy and Deputy Ahern want to express their point of view let them do so but they should not deny anybody else the right to express a point of view.

Is the Deputy suggesting that Fine Gael did not get an invitation from the Congress?

The gimmickry of Fianna Fáil should be exposed in trotting off to Libya with the IFA and pretending to support the ICTU. They are the people who brought about much of the unemployment we now have and the run down in the public service. This is probably the worst Opposition in the history of the State.

From the depth of the Deputy's experience. He is not a wet day in the place.

Deputy O'Kennedy has had many experiences. He spent six months as a Commissioner and then landed back here, for whatever reason. He would do better to remain quiet and put forward his point of view later if he wishes.

Please stay with the Bill.

I will, if Deputy O'Kennedy stops interrupting. The solution put forward by the Opposition is always very simple. This is the worst Opposition in the history of the State. I have to say that I am one of the backbenchers who would be critical of the Government as well. I do not believe it is my job to rubber stamp everything the Government do. I am on record as having criticised the Government where I believe they are wrong. I have put my point of view within the parliamentary party and sometimes outside it. Even in matters of this kind the Opposition constantly put forward the simple answer that it is the Minister's fault, always and ever. Their simple solution is to blame the Minister but this is not a simple problem. It is a difficult problem where a trade union dispute is involved. There has to be some right and perhaps some wrong on both sides. Surely we can elevate the debate beyond simply blaming the Minister and put forward some constructive suggestions based on constructive reasoning as to why the problem has come about. If we approach it in that way we may make a greater contribution towards solving the problem. We are undermining the people on strike and undermining the trade unions by always blaming the Minister. If we could put forward constructive arguments, saying that one part of their case was right or another part was wrong, we might be able to help in resolving the problem.

Deputy Bell made a point about the just rights of people. I accept that and pay tribute to the trade unions for their contribution through the years. Many widows were left with large families — I come from one of them — and they might not have survived if it were not for the actions of the trade unions. That does not mean that they are always right, that they are infallible, beyond criticism and that they cannot be questioned and brought to heel when they are wrong. We seem to suffer from cowardice when it comes to criticising any wrong committed by a trade union. I suspect that 99 per cent of Deputies do not know who is right and who is wrong in this dispute. The amount of information and briefing available on it is appalling. I regret that nobody has taken the time to brief Deputies on the situation. We cannot simply stand up and talk about just rights. Everybody has some rights but also responsibilities.

On the general question it may be asked who has the right to strike. Have the Army or the Garda the right to strike? Have the Judiciary the right to strike? Have the civil servants the right to strike? Have the Central Bank the right to strike? Presumably they have under existing legislation. We should really be concerning ourselves with the question of who has the right to strike. If we deny people that right then we must ensure that they have a proper means by which they can air their grievances and put forward a case. We must examine each case as it arises and not become involved with emotive terms such as "strike breaking" and "just rights". Right and wrong exists in every situation and sometimes it is a question of degree. At some stage this dispute will have to be resolved and I do not know why it has had to come to a strike. I should like Deputies to have more information so that we could make some contribution. To that extent I agree with Deputy Kelly. There seems to be a feeling that the elected representatives of the people in Parliament and the Government should not have the right to say anything about an industrial dispute, no matter how much it affects the public interest. I reject that. It is very silly of us to think that could be accepted.

I should like to know more about this dispute. There should be a briefing document for Deputies as to how it came about, how much the people concerned are being paid, how much they are seeking and exactly what are the terms of the problem. Obviously we must pass this legislation but we should know all the facts which have led to its introduction. Nobody has seen fit to brief Deputies in that regard.

Deputy Bertie Ahern criticised the Government for interference. "Interference" is a great word. We are supposed to interfere with the Garda from time to time or to interfere with this and that. All I can see down the line is people interfering with the rights of politicians, the rights of Government, the rights of elected Assembly. As elected representatives we have the right to raise questions here. Deputy Ahern went on to interfere by putting forward all sorts of arguments and suggestions. We have to be very clear that our loyalty is not to a party or a trade union; our loyalty is to the public interest. If that means criticising the party or the Government of the day or trade unions, that is where our duty lies. We must consider the public interest. It is not our duty to be unfair to anybody or to support the Government simply because we are Government backbenchers if they are being unfair to anybody. I do not wish to be unfair to anybody involved in this dispute. There is no point in saying that because one has the term "trade unionist" or the term "Fianna Fáil" after one's name right is on one's side. Our loyalty is not to a party or trade union but to the public interest.

What would happen if the Minister did not bring in this legislation? What would happen if the Central Bank were unable to function, if the public finances could not be serviced? How could we uphold the State without some powers to deal with the situation as outlined in the Bill in the event of an industrial dispute? I believe that people involved in the dispute will accept that there has to be some power to deal with what could develop into a serious financial situation for the State. If there is a strike in a hospital doctors will always keep emergency services going. This is an essential service and that is the essence of the thinking behind this Bill.

I want to make a point regarding section 2 (3) which empowers the Minister to postpone by order the redemption of the payment of interest or dividends. Perhaps the Minister would explain the effect of such a provision. If it is necessary to use these powers he should ensure that people who are dependent for their living on interest from Government securities are not left without an income. It may be said that there is no power under the legislation to make such a provision but an arrangement could be made with private banks, or some Government Department, to make payments on account to such people so that those who depend on interest or dividends from such securities for their livelihood are not left without money. We should provide for that especially in the period leading up to Christmas. A lot of retired people have put their nest egg into State securities and depend on the interest cheque coming to them. The Minister should tell us how such people will be dealt with. He should ensure that they are not in any danger in this dispute.

I clearly endorse and support trade unionism. It is a healthy and good thing and it has been very beneficial to the State. However, I should like to make it clear, irrespective of what people might think of the comment, that it is not becoming for Parliament to accept any snub, abuse or discourtesy handed out by any trade union leader without putting forward our point of view because we are fearful of being identified with criticism of trade unions. If we criticise trade unions, or their leaders, it is on the basis of what we belive is wrong in trade unions. It does not mean and should not be identified that we are opposed to them. There is that terrible fear among politicians. It is causing us to undermine trade unionism in the long run. Effectively, we are saying to people that we will do this and that when we get into Government but when we get into Government we cannot deliver on those promises. In turn that is being passed on to union members who become restless. We should be able to say that we are not doing this simply because it is a popular thing to be associated with trade unionism. We are doing it because we believe it is right and because we support what is good about trade unionism. I support the legislation. I regret it has been found necessary to introduce it. I hope the Minister finds it possible to give Members a briefing document on precisely what has caused this dispute from the point of view of his Department and perhaps, we may get a document from Congress giving their view. It is a matter on which Deputies should be brought up to date.

After the debate has concluded the Deputy will get a briefing document. That will not be of much use to us then.

I must again emphasise the danger of rushing legislation like this through the House in a short time, four hours in the case of the Bill before us. The Bill was not made available to Members until yesterday. It is a complex Bill and it is rather difficult for Members to understand the full implications of its provisions. We do not know yet what the implications of it will be. In his opening statement the Minister did not enlighten us on the need, the purpose or the effect the Bill will have on public finances. It is not a temporary measure. It is there to stay. It gives the Minister wide powers to introduce its provisions or phase them out any time he likes. There are extraordinary provisions in it and I do not understand the implications of them. One provision states that funds may be transferred to a commercial bank or any other institution. Good heavens, imagine putting that in legislation. What does it mean? Does it mean that the Minister can transfer Government funds to any other institution, a public or private company, any place he wishes? The Minister appears to have total power under a Bill that is being rushed through the House without Members having any idea of its implications. We are all supposed to say "yes" to it. It will be on the Statute Book for ever more without Members having any understanding of the implications of it for the public finances.

It gives a part of public administration over to a private company. It is creeping privatisation and it is permanent, not just for the course of the strike. In his opening statement the Minister said that the provisions were there to deal with any difficulty, where there was any threat of any temporary disruption or otherwise such as a breakdown in a computer facility or anything the Minister might see as a threat. We are giving extraordinarily broad powers to a Minister for Finance which totally undermines the independence of the Central Bank although successive Ministers for Finance down the years have emphasised the need for that institution to have independence. The Minister is removing all independence from the Central Bank with this legislation which amounts to a panic measure being rushed through as a strike breaking Bill. The House is being asked to get itself involved in strikebreaking, undermining the independence of the Central Bank which is supposed to have independence in negotiations on pay. The Minister is interfering in the pay bargaining procedure of the Central Bank in an attempt to ensure that his guidelines are kept. Already the Minister has pressured the Central Bank to the extent that they gave a totally unjust offer of 3 per cent over 18 months with a seven month pay pause.

Earlier Deputy Mitchell expressed the view that there were rights and wrongs and he asked who was right or wrong in this dispute. Any person who sees an offer of 3 per cent over 18 months with a seven month pay pause will know who is right and who is wrong. That person will see that the management of the Central Bank are the cause of the strike. The Minister is using the Bill to bring the Government and the House into the pay dispute. He is using it to interfere with the union bargaining position and the position of the Central Bank in the strike. Some Deputies today were moralising, like Deputy Gay Mitchell, about the public interest. They said that they were anxious to defend the public interest. Deputy Mitchell said all he was concerned with was the public interest but what is the public interest? The Deputy did not define that statement or tell us the public he was interested in. He certainly was not interested in the ordinary general public. The Government have not defended the interests of the general public either in their taxation system which is totally unjust or in their cutbacks on health and education. Was the removal of food subsidies in the public interest? Will Deputy Mitchell defend that decision in the public interest?

Last week bank interest rates were increased by 2 per cent and I should like to know if that was done in the public interest. The Minister for Finance last week said he was against that move and described it as a bad thing. The banks thought it was a bad thing and yet a motion on that was agreed here. The Minister in his speech today said:

I wish to make it clear that it is the Minister for Finance alone who is responsible for the State's financial business.

That is untrue. It is not the Minister for Finance alone who is responsible for the State's financial business because the commercial banks make the major decisions which effect everything the State does. In fact, they direct and decide what decisions the Minister for Finance can and will make in given circumstances.

That is nonsense and the Deputy knows that. The Deputy is the person who was looking for definitions a few minutes ago.

It is true. It is a fact that the Minister for Finance is not in control of the matter at all as was demonstrated last week. He said then that he did not want an increase in interest rates and yet there was an increase. What power has the Minister for Finance to decide on issues like that? What power has he to decide on the lending policies of the banks or anything of that nature? In this Bill he is undermining and interfering with the independence, instead of strengthening the position, of the Central Bank. The Bill has implications which we do not understand. I would like more time to discover all the implications of this legislation.

I ask the Minister to tell the House what other institutions besides the commercial banks will benefit from this Bill. The commercial banks will benefit for instance from the effects on exchange control but I am not competent to say what the full implications will be. When this Bill is passed the commercial banks will have a power they have always looked for. They have been fighting constantly with the Central Bank over issues like exchange control and transfers of assets out of the country. We do not know over which assets the Central Bank will no longer have control and the Minister has not given any indication what powers the commercial banks will take from the Central Bank.

Deputy Kelly made a very interesting statement which indicates the attitude of this Government, the Minister for Finance and Deputy Kelly himself. He said that to pay less than a fair rate of interest would be totally wrong and unjust and could not be done by a Government, but they have no problem in paying less than a fair wage. That would not be wrong or unjust or against the Constitution, against private property rights and so on. You may pay an unjust and unfair wage but you cannot pay an unfair or an unjust rate of interest. That is the attitude of this Government. Their monetary policy has a total disregard for the rights of people and the effects which their legislation is having.

Last week the Government looked around for any kind of EC document they could get to debate in this House because they had absolutely no legislation on their books, but this morning we were told that two important Bills were to be rushed through today with the guillotine introduced on each and the House did not have the right to debate them fully. This very dangerous legislation is being pushed through and when the full implications are examined it will be seen to be giving the must unusual power to the Minister for Finance to transfer powers from the Central Bank to commercial banks and other institutions. That is the most extraordinary information to be given in this Bill — that certain powers will be transferred to "any other institutions" whether it be the ESB, Guinness, local authorities or any other institutions.

What precisely has the Minister in mind? Why put in such loose wording? I ask the Minister to have another look at the implications of this Bill. Even if he insists on pushing it through as a strike breaking effort, I ask him to at least insert a provision that the Bill will collapse when the strike is over, in other words, that this Bill is only a temporary measure. It appears that the Minister is taking this opportunity to implement something he or the commercial banks have had in mind for some time. He is giving the Bank of Ireland powers formerly held by the Central Bank.

I object to this legislation and to the way it is being rushed through the House preventing Deputies from studying it and putting down amendments. I object to the Government Whip saying this morning that he phoned us last night but could not get a reply, implying that we were not in the House. We cannot sit beside the phone waiting for Deputy Barrett to give us a ring, when he did not ring that office once in the past 12 months. He never gave any indication that he wanted to consult us on legislation coming before this House but now he says he rang last night but could not get through. He seems to think that this covers him for rushing through this legislation today. I do not accept that. The way the Government are rushing this legislation through is dishonest because it does not give the Deputies, the public or the media time to study the implications of it before it is passed in this House.

My reaction to this legislation is simple. This is a sledgehammer to crack a nut. This is very serious, determined wide-ranging legislation to solve what is basically a very temporary and passing problem. I want to take up Deputy Kelly's invitation to say what we on this side of the House consider should be the approaches one would take in matters like this. First, one can panic and call in the parliamentary draftsman — who seemed to be too busy to draft legislation which we have been waiting for for a long time — to draft this legislation in a hurry and then rushed it into this House, but there are other ways to tackle this problem and there are other courses which should and could be tried before this legislation is passed. I am in some agreement with Deputy Mac Giolla about the wording of this legislation and I will deal with that in a few minutes, but while this Bill will solve some of the problems arising from this dispute, it will worsen a whole series of statutory provisions which are the job of the Central Bank.

This Bill may deal with the Exchequer Account end of the Central Bank, but it cannot deal in the long term with items such as the printing and distribution of currency, the regulation of the exchange rates, the EMS position, the protection of our foreign credit rating, the monitoring of key indices and assets and liabilities of banks, the liquidity ratios of the various banks and the role of supervising commercial banks. The Bill may solve a very short term problem but in the long term were the strike to drag on, it would have a very serious effect on our financial regulatory system.

We are not voting against the Second Stage. I sympathise with the fact that the Minister has to face a situation which has to be dealt with quickly. There were one or two other avenues which should have been explored. Deputy Kelly and I have one thing in common — we represent the Dublin South constituency and our currency is printed in the very fine plant at Sandyford which is in the constituency. From what I know of the people employed there, there is still a way of solving this difficulty. Section 18 of the 1976 Industrial Relations Act gives power to the Labour Court to intervene in a dispute provided that dispute is damaging the national interest. I ask the Minister and the Government to use that section of the Act and to ask the Labour Court to intervene to settle this dispute in the national interest. A dispute which merits emergency legislation is very serious.

The Labour Court have not been involved in this dispute except at conciliation level. They should intervene now and if they fail the House will stand behind any necessary legislation which is needed to resolve the problem. The Government should also explore the area of arbitration headed by a senior figure who might be available to the Labour Court to be of assistance. I fail to understand why this sledgehammer has been brought in when ordinary machinery has not been tried.

Deputy Kelly also berated the Opposition for listing the role of the Central Bank and reiterating all the fine work they do, without putting forward specific proposals. I have put forward a proposal and I do not oppose the Bill because I sympathise with the Minister who is attempting to handle a very difficult situation. From my perspective of the problem and from that of the workers I know in the Central Bank, they are amenable to a settlement of this dispute without greatly shattering the Minister's pay guidelines. The Minister is dealing with very responsible people who compile Central Bank reports — and every Deputy loves to get his hands on a copy of a Central Bank report — who know the figures relating to the economy and what the country can stand. They understand the Minister's language when he speaks about the need for pay restraint and the necessity to cut down budget deficits, which I wholeheartedly support.

It is important in a Bill like this to be very clear about the sensitivities of the Central Bank. The delicate nature of our financial system has been demonstrated many times. For example, the run — for want of a better word — on the Trustee Savings Bank which is directly under the Minister's control and is the safest of all banks for that reason, was due to groundless rumours. I commend the Minister for scotching the rumours and I support the action he took in that regard. It shows how fragile our financial system is and what a spark of lack of confidence can do. It also surfaced last year in the budget when we attempted to deal with non-residency accounts. Even the Minister was surprised at how quickly the most mobile of all commodities, money, moved. Confidence is essential in avoiding a breakdown or disruption of the financial system. How can the Minister avoid major disruption when the institution set up under the Central Bank Acts to regulate that system is, in effect, frozen by legislation? My main complaint is that it may not have been necessary if other courses had been tried.

The question of EMS realignment has to be mentioned in any debate on the Central Bank. As the Minister knows, EMS realignments tend to happen over a holiday weekend. Speed is of the essence in responding to EMS realignment which may happen every five or six months. Technical expertise is also essential——

EMS realignments do not happen every five or six months, the last was in March 1983.

There is nothing in the Bill to reassure me that, in the event of an EMS realignment, the State can react without the services of the Central Bank. Deputy Mac Giolla mentioned commercial banks. Obviously it is not desirable to have the institutions which the Central Bank was set up to supervise, regulating our financial system. I am attempting to be constructive and helpful because my information and understanding is that if proper procedures are tried in this dispute it could be resolved.

Obviously we cannot vote against this legislation because to do so would plunge the country into immediate financial disruption if the Bill were defeated. We do not have any alternative but we do not vote for it with any great relish. It is never very popular to defend the role of banks as one is accused of being a capitalist or a privatisation expert. However, it is time that people stopped double thinking and stated the precise role of these institutions. The last accounts of the banks showed an 8 per cent to 9 per cent return on capital. If the State or anybody else was running the system I have no doubt that we would be talking about a minus return on capital. Those who advocate a massive onslaught on the banking system as some kind of a get rich quick solution to the problems of the State are living in Walt Disney land. The difficulty is to earn more money for Ireland Limited so that we can distribute it among ourselves and are not continually fighting about an every-dwindling pool of capital and investment. However, that is a debate which I hope to take up on the Adjournment. The affairs of this State are at the lowest ebb for many a generation and I feel extremely strongly about that. I ask the Minister to use the existing machinery and not to have recourse to this Bill.

Perhaps before Deputy Enright starts to speak——

Excuse me, Deputy. I should like to remind the Deputies that one hour remains for all Stages of the Bill.

That is not in order because we have not had time to get into order in the House. Second Stage will conclude about now. The Minister must reply and before that Deputy Enright will speak. I do not want to interrupt any Deputy, particularly Deputy Enright. However, I hope to have an opportunity on Committee Stage to comment also. Could the Minister take account of that agreement in principle and see that we have at least an hour for debate on Committee Stage?

Very briefly, I intend to answer questions which Deputies have put to me here. The shortest speeches on this matter which have been made so far have been on this side of the House. Frankly, it is my sincere belief that the points made by Deputies O'Kennedy and Séamus Brennan could have been made with a considerably greater economy of language.

We are trying to be helpful in reaching agreement.

I am trying to help the Deputies.

That was a most unhelpful remark.

Are we to count the words?

If we come here to contribute to a very shortened debate, and the Minister makes that kind of remark, it is very unhelpful. This will be the last time we will try to help. The Minister is a most unhelpful person.

I am glad that there appears to be general agreement with regard to this essential Bill. Everybody in the House and throughout the country recognises its importance and we must all take it very seriously. We are dealing with the finances of our country and the accounts of our nation.

The staff in the Central Bank are in a very unique, special and privileged position. We all have a duty to listen carefully to comments and reports issued from that bank, because they have a thorough grasp of what is happening in relation to the finances of the country and our whole economy. What they say must be taken as the basic truth of the situation. People in such a privileged position with regard to themselves and the economy should consider very carefully their actions before pursuing the course they are on at the moment.

There must be faith and belief in Exchequer stock. People have invested in that public stock, issued on the Irish Stock Exchange, and there may be a regrettable delay in the payment of dividends and with regard to stock falling due for redemption. This is very serious. The actions of the Central Bank staff are causing problems for the ordinary investor and it is important that the Minister take whatever action is necessary to ensure that these delays are minimised to the fullest possible extent. People on small and on fixed incomes who are depending on the payment of dividends must be considered. They have invested in Irish stock which is used for the benefit of the country and withholding payment of such dividends is unfair and wrong and should not be allowed to happen.

People in such privileged well paid positions, should be very slow to strike because they cause such great inconvenience. These people are quick to lecture us and it is important that we are all lectured and listen to some of what is said. However, one is judged by one's actions. The Government have been forced to take necessary action to protect the State's finances and they are to be congratulated in moving in this manner. They have been correct in taking this important decision. By their present action, the staff of the Central Bank are jeopardising the good which they have been trying to do for the country. They should be more cautious and careful before taking such precipitate action. The Government have no choice but to bring in this measure this morning in the interests of the country. I hope that there will be full agreement with regard to its general provisions, although there may be some specific items about which some Members will not be happy. It is important that a measure of this nature should have the full co-operation of all parties in this House.

The Minister, to conclude Second Stage debate.

I shall be as brief as I can, bearing in mind that Deputies on both sides of the House have raised a number of questions which need to be answered at the end of Second Stage debate.

With regard to the date on the Bill as circulated, that is the date on which it was presented to the Clerk of the Dáil for printing. That date always precedes the date of circulation on every Bill brought into this House. Deputy O'Kennedy received a true copy I understand, of the Bill, on Monday and it was circulated on Tuesday.

On Monday evening at 6.30 p.m.

Yes, Monday evening. That is economy of language.

There is a difference to me.

This is not, as Deputy O'Kennedy has claimed, an unprecedented Bill. The 1970 Finance Act contained a similar provision in relation to the redemption of securities being deferred due to the closure at that time of the Bank of Ireland, which at that stage was handling the State's financial affairs. In 1971 the Exchequer account was transferred to the Central Bank from the Bank of Ireland which up to then had care of it. It is not true to say that it is unprecedented. The only statutory function of the Central Bank that is affected by the provisions of this Bill is the operation of the Exchequer account. The other statutory functions are not affected by the Bill. I do not say that they are not affected but they are affected by the Bill.

As far as the exchange rate operations and the EMS are concerned, the foreign exchange market continues to operate smoothly and continues to be monitored by the Central Bank. The operations of monetary policy are primarily a matter for the Central Bank and they continue to be in a position to control and monitor overall bank liquidity so that there is no immediate problem on that side. The normal reporting procedures which are required of the licensed banks continue to be observed. The Central Bank have at their disposal all the credit information necessary to monitor these developments. The provisions of the Bill do not interfere with the statutory functions of the bank other than the operation of the Exchequer account.

In relation to the payment on dividends and interest, this Bill does not represent the rupture of a contract by the State between the State and citizens. As Deputy Kelly pointed out, an external event has frustrated the operation of the contract. The provisions of the Bill are not to stop payment but to provide for payment at the earliest moment when it is possible to make payment. The provisions of the Bill are not the cause of people not being paid. In fact, section 3 is designed to remedy that problem.

But they will not get their money on 1 January.

I cannot make payments to the people who are entitled to them, simply because the register of people who are entitled to these payments is held in a separate bank and I do not have access to it. If I had access to it I could make the payments. That is why I had to make a specific provision in the Bill. The provision in the Bill is not the cause of the problem but rather attempts to bring about a remedy to that problem. To the extent that people have entered into other commitments in the expectation of these payments I appreciate they have a problem but in the absence of access to the register I cannot make payments. I would not know who was entitled to payment or any other information which is required.

Deputy Brennan characterised this Bill as a sledgehammer to crack a nut and then outlined all the things the Bill does not deal with. As he went through his list he seemed to be knocking bits off the sledgehammer so that what we have, to use his own phrase, is a very precise little hammer which does a particular job. This Bill provides the minimum that can be possibly provided in order to keep the financial business of the State going. It is in everyone's interest that this be done. It would be a mistake to present the Bill, as Deputy Mac Giolla attempted to do as a strike breaking Bill. What the Bill provides for is the measures which are the necessary minimum to keep the ordinary financial business of the State going. That is in keeping with everyone's idea of the public interest however it may be defined.

I would prefer if we did not have to have this Bill. However, there is a wider case for it than simply the dispute which has been the immediate cause of the Bill being introduced. In the national plan and in previous statements the Government have made clear their views on pay policy for the economy as a whole and for the public sector, the private sector and areas where they directly control pay and, indeed, areas where they do not directly control it. That is a legitimate activity for Government and it is in order for the Government to say they believe these are the limits which should be set in pay developments in both the private and public sectors. I do not accept that the Government should stay away from those areas as Deputies opposite seem to think, particularly since in a number of cases we are talking about areas which will directly or indirectly affect the total size of the Exchequer pay bill and the call we will have to make on the taxpayer in order to find that expenditure.

I have covered the more common points that were made.

What are the other institutions?

The other institutions would include possibly the ICC, ACC or the non-licensed banks, such as the Trustee Saving Bank.

I know the Minister had to be brief in his reply but there was one central point I asked about at the beginning of my contribution. Has the Government or the Minister been in direct contact with the Central Bank regarding the negotiations between the Central Bank and their staff?

I have made that clear. The Government made it clear to the public service and to semi-State bodies in the public sector what they believe the proper course of pay development should be. We have indicated clearly what the guidelines are to all semi-State bodies.

Including the Central Bank?

Yes. We have told them what the guidelines are and the path that should be followed in relation to public sector pay.

May I ask a brief question? The Minister stated in his speech that consultations took place with a number of people on the drafting of this Bill. Was there consultation with the Governor and Board of the Central Bank?

I stated that we had consultations with the Office of the Comptroller and Auditor General.

Were there also consultations with the Governor and Board of the Central Bank?

Offhand I could not answer that question but I can get the information for Deputy Ahern.

Question put.

The question is that the Bill be now read a Second Time. On that question a division has been challenged. Will Deputies who are claiming a division please rise in their places?

Deputy Mac Giolla, Deputy De Rossa and Deputy Gregory-Independent rose.

As fewer than ten Deputies have risen, in accordance with Standing Orders, I declare the question carried.

Question declared carried.
Agreed to take Committee Stage today.
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