Estimates, 1986. - Vote 3: Department of the Taoiseach (Revised Estimate) (Resumed). – Dáil Éireann (24th Dáil) – Friday, 4 Jul 1986

Estimates, 1986. - Vote 3: Department of the Taoiseach (Revised Estimate) (Resumed).

Debate resumed on the following motion:

That a sum not exceeding £5,632,000 be granted to defray the charge which will come in course of payment during the year ending on the 31st day of December, 1986, for the salaries and expenses of the Department of the Taoiseach, including certain cultural and archival activities and for payment of certain grants-in-aid.

—(The Taoiseach).

Mr. Haughey

As the Dáil rises for the summer recess the country remains in a state of deep economic depression. Unemployment, already disastrously high, is still rising and emigration is reaching catastrophic levels. Despite all attempts to create the opposite impression there is no economic uplift.

The Taoiseach, finally yesterday, was forced to disclose how seriously this year's budget is getting out of line. He had to admit that spending and particularly current spending had been running ahead of the level projected in the budget. Even though he did refer to the collapse of Dublin Gas and its adverse effect on revenue, he carefully concealed from the House the really serious information that the cost to the Exchequer will be at least £70 million this year and probably more.

Typical of the Taoiseach in an attempt yesterday to try to distract attention from the disastrous situation in the economy and the public finances at present, he started to attack imaginary proposals from this party. He stated that Fianna Fáil have been proposing time and again increases in public spending both capital and current which if implemented would involve a scale of borrowing which could only have a disastrous impact on the level of domestic interest rates.

I wish to state categorically that we have done nothing of the sort and that it is dishonest scaremongering by the Taoiseach to suggest that we have done so. It is his Government, the Coalition of Fine Gael and Labour, who are running current budget deficits at such a level that they have been compelled to borrow more than any other Government and to practically double the national debt in three and a half years.

There is hardly a single sector of the economy which is not either depressed or actually in decline. The amount taken by the Government in taxation is still abnormally high; real interest rates are still at a disincentive level; there is no prospect of the budgetary situation being resolved and Government borrowing remains at an unprecedentedly high level. The Irish economy has not responded in any way to the favourable conditions which are now developing internationally.

None of the different sectors of the economy offers any grounds for optimism. It certainly looks as if agriculture will have another poor year, due to a combination of bad weather and the squeeze on prices and production being exercised from Brussels. The IFA's chief economist recently predicted a real drop in farm incomes of about 10 per cent this year. Milk production is down by 11 per cent to the end of May. It is quite impossible to see on what grounds the OECD forecast "a projected recovery in agricultural incomes". It is, in fact, impossible to see any growth stimulus coming from agriculture.

State support for Irish agriculture has been cut in half since 1982, at the very time that the European Community support system is being gradually dismantled and replaced in other countries by increased Government subsidies to agriculture. The fodder schemes last autumn were totally inadequate and EEC schemes such as headage payments are not availed of fully, because the Government are not prepared to make their contribution. The European low interest schemes have been made virtually useless because of the additions made to the low interest rate by both the Exchequer and the banks.

Our agricultural interests have not been defended in the European Community over the past three and a half years. There has been a steady erosion of benefits from the CAP, and Community funded schemes have been abandoned by our national Government. Farmers are in real difficulty all over the country, even in the normally prosperous areas. Even with assistance, it is going to take them a long time to recover, but clearly under this Government no assistance is forthcoming.

There was something approaching a boom in the tourist industry in 1985. Unfortunately, however, the downward movement in the value of the dollar and the campaign to promote fears of international terrorism had a very serious detrimental effect on our prospects for this year. It is possible that there may be a decline in tourist earnings this year in the order of 10 per cent.

A major increase in consumer spending which was so confidently forecast by Government speakers and commentators and indeed, which was one of the central elements around which the 1986 budget was framed, has not materialised and does not, at this stage, look like materialising. It is highly unlikely that sporadic improvements here and there will translate into any sizeable overall increase in expenditure or that the projected boom is likely to happen within the next 12 months.

Incredibly, the construction industry is apparently to be allowed to decline yet again this year. Employment in this vital industry is certain to fall with a 12 per cent decline in cement sales in the first four months of this year already recorded. The number of private houses built is again set to fall, possibly by as much as 9 per cent. This cannot be compensated for by the home improvement grant scheme about which so much propaganda is being made. The public capital programme, in so far as it affects the building industry, has been cut in real terms every year under this Coalition and is now down by a full quarter in volume terms.

Direct impositions on the house building industry have been the increase in VAT from 3 per cent to 10 per cent in 1982 and, of course, the section 23 incentives have been virtually abolished. The recent annual report of the CIF states: "There is a massive haemorrhage of emigration at all levels of the industry". The report goes on to criticise Government forecasts as "widely optimistic" and that: "It is unfortunate that some politicians and economists forecast an upturn this year as this assists in preventing action being taken".

The position in manufacturing industry is depressing. The latest figures for the first quarter of 1986 show zero growth in total transportable goods industries compared with the first quarter of 1985 and the figures for March actually show a fall in the output of manufacturing industry by one quarter of one per cent compared with a year previously. In the Building on Reality document, manufacturing output was projected to rise by 36 per cent between 1984 and 1987. At the present rate it will fall 10 to 16 per cent below that target. Industrial employment in transportable goods industries has fallen by 17,000 since the Government took office to the lowest level for at least 20 years. The absence of any significant new investment in the last three years is now showing up in the industrial production figures. The forecast of a rise in output based on extrapolation of the slight improvement towards the end of last year appears to have no basis in developments so far this year.

If we look at the trade figures, the position is even more depressing. It is, of course, completely mistaken to believe that as long as there is no deficit on the balance of trade all is well. A balance at a very low level simply demonstrates the extent to which the economy is depressed. That is what is happening at present to the Irish economy. During the first five months of this year exports have dropped in value by £120 million, or by 3 per cent compared with the same period last year, while imports have dropped by £470 million, making a total decline of 8 per cent in the value of trade. That is precisely a reflection of the downward spiral to which I have often referred, a direct result of Government policy. Compare that with the recent statement in the OECD report: "Export growth may gather speed in 1986 and 1987 with the expected recovery of the high technology sector. Import volume is projected to rise significantly reflecting the firmer trend of final demand and the end of destocking". Somebody is fooling somebody.

While inflation is continuing to fall, it is now clear that there will not be the major reduction contemplated by the Government. It is difficult to see how average inflation for the year can now be less than 3½ to 4 per cent. However, the benefits of lower inflation are not being passed through to the productive sector because of the continuing very high level of interest rates. These, in turn, are related to Government borrowing, exchange rate policy and the introduction of DIRT. Money that left the country earlier does not seem to have returned. The Government's handling of the exchange rate is doing enormous damage. It is crippling a wide range of firms engaged in manufacture for export and will result in serious job losses. The policy has the purely political objective of lowering the rate of inflation, without regard to the damage being done to exports. The CII know this, but are apparently reluctant to say it publicly.

Official budgetary projections now, halfway through the year, seem to be without foundation. One of the consequences is that there will almost certainly be for the fifth year in succession a revenue shortfall and a larger current budget deficit than planned. Even on their own stated key objective the Government have failed to reduce the current budget deficit much below the 8 per cent level, if at all.

A couple of weeks ago I went into some detail on the current levels of taxation and how they are inhibiting recovery. I pointed out, for instance, that the amount of tax to be taken under PAYE in 1986 is about 25 per cent higher than in 1982, after adjustment for inflation.

This year the Government planned for an increased tax yield of 9½ per cent on the basis of a growth rate of 3 per cent. That is clearly not going to happen. I do not believe that the Government will achieve their revenue targets, and I think by the autumn this will have become very obvious. They seem unable to learn that they are trying to impose more than the traffic can bear. Even the most modest economic growth will be impossible without a reduction in taxation. We have argued again and again that reduced tax rates need not mean a correspondingly reduced tax yield. It is quite possible that the present tax yield could be broadly maintained at significantly lower rates of taxation in certain areas of our heavily overtaxed economy.

In his speech yesterday, in an obvious attack on the Progressive Democrats, the Taoiseach said:

I do not think that it is in the public interest to promise 25 per cent tax rates, unaccompanied by details as to how the system would operate beyond the revelation that it would involve the elimination of personal allowances.

But that is precisely what Deputy FitzGerald himself did in the 1981 general election. He made a specific promise to reduce the standard rate to 25 per cent. Wild promises of that type, whether from Fine Gael or the new group that is cast in their own image and likeness which cannot possibly be implemented, have no credibility with the public any more. What is wanted is a mature, sensible approach to taxation that produces a series of real as opposed to cosmetic and unreal reductions within the limits of the possible and without a wholesale dismantling of necessary services.

When I spoke in this House a few weeks ago in Private Members' time I referred to the conspiracy that exists to conceal the true position in regard to the public finances. The irrefutable facts are that the current difficulties began in 1973 when the present Taoiseach, Deputy Dr. FitzGerald, was the guiding hand behind the policies of the Coalition Government which held office between 1973 and 1977. It was then that the major rise in the national debt and foreign borrowing began.

Since 1973 the three Coalition Governments have accounted for 60 per cent of the increase of £20 billion in the national debt that took place in that period. Our total foreign debt is now £8.4 billion and the three Coalition Governments have been responsible for nearly two-thirds of that amount.

This present Coalition Government, in their three and a half years in office, have been borrowing at an unprecedented rate, the highest in the history of the State. Since they came into office the national debt has gone from £12.8 billion to £21.5 billion. That increase by this Government in three and a half years is the equivalent of the entire national debt incurred under all Fianna Fáil Governments that there ever were in this State.

I propose to keep on reiterating these basic facts until they are finally acknowledged by the Taoiseach. He had the audacity to try to mislead us again yesterday by blatantly misrepresenting this piece of financial history. He does not scruple at scaremongering based on his personal distortion of the truth. He spoke of those "terrible years" and "if our country were to fall once again under the control of those who so mortgaged it beyond the hilt". Of course, he was talking about himself.

I challenge the Taoiseach to deny the facts as I have outlined them. The record clearly shows that Governments of which he was a member are responsible for two-thirds of the increase in national debt that has taken place since 1973 and that this Government of his borrowed more in three and a half years than all Fianna Fáil Governments put together.

All the Government propaganda, all the handouts, all the briefing of friendly correspondents cannot conceal the simple fact that this year the public finances are in a worse state than when this Government took office. They are as bad as they have ever been in our history.

The latest Exchequer returns show that the Government are further than ever away from reducing the current budget deficit to 5 per cent of GNP in 1987. Building on Reality stated that:

the Government will ensure in the 1985 Budget that both the current budget deficit and the Exchequer borrowing requirement are kept broadly to their 1984 proportions of GNP. A significant reduction in the size of these aggregates is expected in 1986 leading to the position outlined for 1987.

The current budget deficit was 7.1 per cent of GNP in 1984. In 1985, it was 8.2 per cent of GNP, so it was not kept broadly to the 1984 proportions of GNP. Now this year, even on the Government's own admission, the deficit is likely to be at least £1.3 billion and probably 8 per cent of GNP. How in these circumstances can anyone in the media or anywhere else talk about getting the public finances under control? The Irish Times of Wednesday 2 July 1986 told us that the full year's figures should result in only a modest overrun. Of course, if it were a Fianna Fáil Government no overrun of any kind would be permitted.

I am afraid I cannot share The Irish Times' optimism. Over three-quarters of the deficit projected for the whole year has already been incurred. The Government's belief that the overrun can be contained to that sort of figure is based on expectations of a consumer boom which is nowhere in evidence. The comments in the May 1986 business and consumer survey published in European Economy tell their own story:

The slight improvement in the consumer climate in Ireland is the result of a somewhat more optimistic assessment of general economic prospects. But consumers assessed their own financial situation somewhat more unfavourably than hitherto and purchasing intentions have declined further.

VAT revenues in the first half of the year have fallen far below the target increase, rising by only 5½ per cent instead of 11½ per cent. In view of the fact that the VAT on some items is being reduced in the second half of the year from 25 per cent to 10 per cent it seems likely that there will be a significant shortfall in VAT revenue. This is the inevitable outcome of this Government's mistaken policy of trying to balance the national books by increasing taxation which is emerging fully and starkly this year.

The public finances are continuing to deteriorate because the economy is on the floor, because the productive capacity of the economy is falling, because there has been no investment now for three and a half years. That is why revenue receipts are, in fact, falling off and why the Irish economy is not responding to the more favourable international climate which now prevails.

The OECD forecast set out in their May 1986 bulletin was so divorced from reality as to be very misleading. They suggested that private consumption growth might accelerate to 3.5 per cent buoyed by lower inflation and a projected recovery in agricultural income. They also claimed that investment was expected to display more strength, primarily as a result of a pick up in construction. Everyone knows there is not going to be any recovery in agricultural income or pick up in construction and the Government owe this House and the Irish public an explanation as to why these, not just slightly inaccurate forecasts but grossly misleading claims, could be made by the OECD or who supplied that international body with that tissue of lies.

Nor is there any indication of any upswing in manufacturing output this year. The figures to the end of February show there is, in fact, stagnation. The latest figures for retail sales show a negligible 0.1 per cent increase in volume compared with the preceeding three month period.

The Irish economy is just not responding to favourable developments in the international environment because the policies of this Government are mistaken and are resulting in Ireland having the worst economic performance of any country in the OECD.

The Taoiseach has consistently tried to mislead the public about the state of the economy. He has time and time again forecast an upturn which has never materialised. At the IMI Conference on 27 April 1985 he said:

And the latest economic news has been encouraging too — the fall in inflation in February, the dip in unemployment in March and the decline in interest rates this month; all positive indications of the health of the economy; all signs that we are "winning through".

Here in this House on 21 February 1986 he claimed:

The country is now in far better shape to achieve a recovery that will benefit all our people than when we took office in 1982.

Going back again a year later, one cannot fault him for temerity, to the IMI Conference on 13 May 1986 he stated:

We are moving into a period of more rapid growth which will be led both by domestic consumption and by exports.

Yesterday in his speech he was forced to admit the reality when he said:

What we would like now is to see this increased spending power being translated into jobs. This has not yet happened either here at home or in other European countries.

Unemployment is 230,000 and still rising. We do not have the June figures, but it is almost certain they will show a further increase when they are published and the upward trend that was shown in the May figures will continue.

A recent study by the Youth Employment Agency on the young long term unemployment paints a frightening picture. It shows young school leavers with few qualifications, over half of whom had been unemployed for more than two years, coming from families where the parents and the brothers and sisters were also most likely to be unemployed. One quarter of those covered in the survey had not worked since leaving school. It adds up to a grim picture of social deprivation, human misery and disappointment.

It is scandalous that the Government are making no effort to provide reliable emigrations statistics. I am aware of the limitations of the passenger movement statistics as a precise guide. Nevertheless, the rise in the net outward movement shown in the Taoiseach's reply to Deputy John O'Leary is horrifying. A total of 10,000 left between June 1983 and May 1984, 38,000 between June 1984 and May 1985 and 64,000 between June 1985 and May 1986, a total of 100,000 all together. That is reason enough for this Government to resign forthwith. This increase cannot be explained away by specious arguments by economic commentators wheeled out to explain the Government's failures. This rising tide of emigration, of course, makes a nonsense of the suggestion that the Government are somehow getting on top of the unemployment problem. The official unemployment statistics are only the tip of the iceberg. The slower rise in unemployment is entirely due to the escalation in emigration. The real rate of increase in unemployment has not slowed down at all under the disastrous policies of this Government.

Is it any wonder that the ICTU, at their annual conference in Belfast on Tuesday, unanimously called on this Government to resign and go to the country on their economic record? I recommend that ICTU statement to the Tánaiste for consideration, rather than some of the rubbishy things he has been perpetrating on the Irish public.

I have on many different occasions inside and outside this House outlined the positive steps which the next Fianna Fáil Government will take to promote economic recovery; reduce taxation, revive the construction industry, develop our natural resources, and to develop a strong scientific and technological base, all designed to stimulate growth and provide employment.

The primary purpose of tax reductions should be to stimulate economic activity. Any steps taken by this Government latterly have been ineffective, and have done nothing to counteract the heavy increases in taxation already imposed by them. Excessive indirect taxation depresses sales, and depresses employment. Where the product in question is manufactured at home there is also a knock-on effect on industrial employment. I believe this Government have been exclusively concerned with the immediate short term revenue gain from their tax impositions without having adequate regard to the wider economic picture. Fianna Fáil will review the broad impact of the tax levels on particular items.

Excessive levels of taxation have increased the size of the black economy. The challenge for the next Government is to make the tax system fairer, and to lift an excessive burden of income tax from the employed sector. What is wrong with this Government's tax system is the ridiculously low levels at which the higher bands begin to bite. This Government have opted to reduce the top rate of income tax, instead of raising the threshold at which it applies. The middle rate was actually raised from 45 per cent to 48 per cent, a couple of budgets ago. Our proposal, which is sensible and which would not be expensive to implement, is to ensure that two-thirds of taxpayers pay only the standard rate of income tax, and that the top rate applies only to high income earners.

One of the very serious side effects of high personal taxation is that many talented and well-trained people, capable of making an important contribution to our economic development whom we can ill afford to lose are emigrating to countries with more favourable tax regimes.

The continued run down of public investment must be halted and reversed. Projects, particularly those with a construction element, which will add to our national wealth or improve our infrastructure, must be brought forward. We should not have to wait into the next century, for instance, for the completion of a natural gas network or for the building of a motorway ring road around Dublin. There are also many projects which could be undertaken to enhance our tourism facilities and preserve our heritage.

The development of our natural resources needs to be given a new impetus. We must develop our marine capabilities. There is no doubt that marine fish farming offers a great opportunity to give a new lease of life to our coastal communities. But it must be developed along the right lines and I am apprehensive that it may not be from what I hear. Nor are we making the best use of our forestry resources.

The oil exploration situation is in a state of depression with very little activity at present. The Tánaiste and Minister for Energy spoke at some length about this area in his Estimate speech. Within that speech I took particular note of one sentence uttered by the Minister. Speaking about the effect on exploration of lower oil prices, he said: "I am considering what further steps can be taken in present circumstances to encourage exploration in the years ahead without unnecessary impairment of the overall national interest". That sentence immediately raises some doubts and suspicions. I hope these are groundless but we all know there are very determined and ruthless commercial interests pressing for much more favourable treatment and that those interests are supported by a strong political lobby in the Fine Gael Party. It is also a fact that those commercial interests have recruited the Progressive Democrats to their cause, for some reason that we can only speculate about at this stage.

I wish to say to the Government that there must not be any change in the manner in which this important and valuable national resource is to be handled without the full knowledge and authority of Dáil Éireann. I hope there will not be any attempt to announce changes during the long summer recess or that when we come back in October we will be presented with a fait accompli. I would like to give notice now that we would not be prepared to accept any such procedure and would feel fully entitled to challenge any such arrangements, if they were made, at the first available opportunity.

We must review the services we can offer as a nation. We must promote Ireland better as a centre for transacting international financial services, now that our communications have been improved, as a crossroads between East and West, between Europe and America. As a neutral country we can offer training facilities to countries, who can be confident that we have no interest or wish to subvert the political or cultural ethos of their citizens. I have no doubt that we have the capacity to increase our foreign currency earnings substantially through training courses, conferences and seminars, but we need to upgrade some of our facilities. Ireland should further develop its international sports profile, and the facilities for hosting major sporting events.

We need to develop a greater range of high quality internationally marketable products. We have had some outstanding successes in recent years. We need more of them through a combination of product quality and export marketing. We should use to greater advantage our good environmental image and also make sure that it is preserved. We must develop the bridgehead that we have already in the high technology sector.

Good government is about identifying national opportunities and grasping them. Very little has happened over the past four years compared with the creativity of previous decades. There has been a failure of vision, a failure of imagination, with the result that the country has been put back into that depressed and stagnant state that we thought we had left behind us forever.

I must express astonishment at the Government's out of hand dismissal of the Commission on Social Welfare report. Only three or four months ago the present Minister was appointed to this portfolio and the Taoiseach told us at the time that he had done so because of the importance he attributed to implementing the report of the Commission on Social Welfare. That was an untruth and Deputies will recall that I pointed out at the time that it must be untrue and could not be the reason for appointing Deputy Hussey to the unlikely post of Social Welfare. Of course the Taoiseach told an untruth then.

The outcome of the recent constitutional referendum was a massive rejection by the people of the Taoiseach's proposal. This was not just a case of a proposal being put before the people by the Government. It was advocated by the Taoiseach with the strongest possible personal emphasis.

The Taoiseach did not confine himself to arguing in favour of the proposal. He made the issue very much a personal one and appealed personally and as Taoiseach to the people to accept it. He availed extensively of the national radio and television service and of press advertisements, to emphasise again and again his personal recommendation of the proposal.

In the event, the people decisively rejected both his proposal and his personal appeal. Any head of Government who puts a major proposal to the people and who personally advocates it so strongly and has it so overwhelmingly rejected, cannot claim to have the confidence of the people. Clearly a Taoiseach who brought such a situation upon himself, whose judgment has been shown to be so bad, cannot be regarded as having any mandate to govern.

The Taoiseach in his speech yesterday made the following extraordinary statement:

I am happy, proud indeed, that I brought forward the proposition and put it to the people.

He also spoke about leadership. I cannot say whether he has convinced himself in this regard or whether he is just putting a brave face on disaster. Can anybody claim that it is political leadership to lead this party into the greatest electoral humiliation of all time? Can anyone claim that it is political leadership to be so out of touch with public opinion as to put forward a proposal which is rejected by almost two-thirds of the voters?

The Taoiseach maintains that he was right to put the proposition to the people. I cannot see how that can possibly be sustained. We are talking here about a very major matter — a proposal to change the Constitution. I do not think it is right or good political leadership to put a proposal of that kind to the people just for the sake of putting it, as an exercise or, as it were, just trying it out. That is not the way to run a country or treat the Constitution, our basic fundamental law. I do not think that any serious student of politics could accept such an approach to the Constitution. It is not legitimate to put the nation to the expense and diversion of effort involved in a referendum just to satisfy some personal impulse when the proposal has no hope of succeeding.

Some of his political associates are talking about the Taoiseach's courage in bringing forward this proposal. They could also talk about the courage of Lord Cardigan in leading the Light Brigade to destruction in the jaws of death at Balaclava. Responsible political leadership surely is about the successful attainment of objectives, not about rushing erratically into crushing defeats.

Ireland's recent performance in international affairs has been faltering and hesitant to put it mildly. This Government no longer seem to wish or to be able to exercise freedom of action on important international issues. I think the Government should know that there is widespread, keen disappointment about their stance in regard to the unfolding tragedy in South Africa. Ireland had a very good international reputation in regard to apartheid. Under previous Governments we were respected around the world but we are losing that respect. I believe that among the people of this country there exists a widespread abhorrence of apartheid and what is happening under the state of emergency and the policies being pursued by the South African Government. Increasingly, there is a conviction among those concerned about the situation that only sanctions will bring the change that is urgently needed. Our friends around the world, and the Government should know this, are dismayed and are beginning to suspect that we are using the European Community and the political co-operation machinery of that Community as an excuse for not taking action.

This latest European Council in The Hague does not seem to have accomplished anything useful either. The discussion was dominated by the situation in South Africa but no real progress was made on the sanctions issue.

The civilised world has a responsibility to do something about South Africa, especially as many countries have a heavy economic involvement in the country. Following the European Council, it would appear that the Community is not prepared to interfere, except in a superficial and innocuous way. Investments and perceived strategic interests apparently count for more than elementary justice, freedom and human life itself.

Paragraph 5 of the European statement says: "In the meantime in the next three months the Community will enter into consultations with the other industrialised countries on further measures which might be needed covering in particular a ban on new investments, the import of coal, iron, steel and gold coins from South Africa." That does not involve any binding commitments made.

The Taoiseach claimed it was preferable to avoid a split in the Community. I find that somewhat unreal and would have preferred an outcome that those opposing sanctions would have been clearly identified before world opinion. When he says Community action is likely to be far more effective than action by any single country or member state, he is presupposing that there will in fact be Community action, something about which it is not possible to be very optimistic at this stage.

I do not think that this Government's own record on apartheid is very impressive. Concerned Irish men and women are complaining that the Government are less active and less committed than their predecessors. I gather that at the recent UN conference on sanctions against South Africa, Ireland was represented at junior diplomatic level, when other countries were represented by their Foreign Ministers. Furthermore, Ireland is the only country in the EC apart from Britain not to require a visa from South African citizens.

Coal, for instance, is amply available from dozens of other countries and there is no reason the Government should not impose a ban on coal imports from South Africa. Other European countries, notably Denmark, have taken unilateral sanctions, and it would increase the pressure on the larger member states to act if we did so.

The Presidency Conclusions cover a number of other subjects, but do not amount to anything of significance. The European Council carefully avoided any suggestion of a co-ordinated reflation as an answer to the unemployment problem. However, I acknowledge that at least the Irish Government are beginning to press for such a response from the Community.

The passage on agriculture means effectively that Irish farmers will continue to lose out. The conclusions state: "the European Council must continue to adapt the Common Agricultural Policy to the changed circumstances...a better control of total production must be ensured so that it is better adjusted to the market situation with the result that the share of public expenditure claimed by agriculture can be reduced".

Mr. Wilson

Scandalous.

Mr. Haughey

Irish farmers are in extreme difficulty. Their morale is low. Nothing has emerged from this Council to offer any hope or prospect of improvement.

The passage on nuclear energy is also totally unsatisfactory. There is neither hint nor implication in the language that even consideration is being given to the Irish Government's proposal for a European nuclear inspection force. That suggestion is studiously avoided. The Taoiseach points out a reference to nuclear safety in the conclusions. Surely he is not trying to disguise the clear implication contained in the statement when it talks about the Community institutions and the member states concerting this, "each within the limits of their powers". That effectively rules out any Community safety inspectorate. As a result, the Irish people live under the threat to their health and safety posed by Sellafield. We are again asking this supine Government in the interests of the Irish people to raise this whole nuclear menace with the British Government as a bilateral issue.

I must also express grave disappointment that in a list of more than 60 Eureka projects published earlier this week, there was not a single Irish participant. It is surely a serious reflection on our approach to science and technology that while non-EC countries, Austria, Finland, Norway, Sweden and Switzerland have all won projects we have not a single one.

I have already stated my view that the outcome of the referendum will not really damage the prospects of Irish unity. I have also said that if the Taoiseach and the Government believed it might, there was a responsibility on them to take that factor into consideration when they were deciding whether to proceed with the referendum.

The Fianna Fáil position, following the publication of the New Ireland Forum report, is consistent and clear. It is our view, as expressed in that report, that a democratic unitary State covering all Ireland would guarantee the civil and religious liberties of all citizens on a basis that would entail no alteration or diminution of the provisions in this respect which apply at present to the citizens of Northern Ireland. Such a State would represent a constitutional change of such magnitude as to require a new Constitution. Such a Constitution should be formulated by a Constitutional Conference which would be convened by the two sovereign Governments concerned and which would be attended by all parties on this island who are prepared to abide by and accept constitutional politics. I have good reason to believe that that proposal of ours would now find a much wider degree of acceptance where it matters than when it was originally put forward by us. I want to assert that, in my view, it still offers the only possible way forward out of the chaotic situation to which the North of Ireland has been brought today.

Unfortunately, experience to date shows that the Anglo-Irish Agreement has brought neither peace, stability nor reconciliation. There has, I am assured by responsible and trustworthy people that there has been no improvement in the area of employment discrimination. Six or seven communiqués have been issued by the Anglo-Irish Conference without a single reference to the issue of employment discrimination.

The Irish Consul-General in New York, who has been lobbying against the adoption of the MacBride Principles by legislatures in the US, wrote on 20 March to a Senator Ohrenstein of New York State in the following terms: "The Irish Government shares the goal of those who wish to see an end to discrimination in employment in Northern Ireland and will continue to work to eliminate it. It believes that the goal can best be achieved through the framework of the Anglo-Irish Agreement", despite the fact that the six or seven communiques have made no reference to it.

I want to avail of this opportunity to state that I fully endorse the MacBride Principles. I welcome the efforts and initiative of concerned Americans who wish to see something done about the chronic discriminatory patterns in employment in Northern Ireland. The regrettable position is that 14 years after the imposition of direct rule in Northern Ireland, the situation in most sectors of employment is as bad, if not worse, than it ever was. The purpose of the MacBride Principles is to ensure that if there is to be American investment, if there are to be American orders, the firms concerned will have to act fairly and in a non-discriminatory fashion in regard to employment.

I regret to say that I and many others have become increasingly aware of the politicisation of the Department of Foreign Affairs and the diplomatic service. This has been most unhappily evident in the US where public servants paid by the Irish taxpayers are being compelled to engage in political manoeuvrings which are certainly not in accordance with the normal standards applicable in the Irish public service.

There is a growing volume of suspicion about the Taoiseach's behaviour in regard to Articles 2 and 3 of the Constitution. He has never made any secret of his desire to remove them. Recently, however, it has been strongly suggested that the Taoiseach or other representatives of this Government gave members of the British Government the impression that Articles 2 and 3 which assert the integrity of the national territory, would be removed in due course. A British Cabinet Minister has been reported as telling a Unionist leader that: "You won't like some of the things I'm going to have to agree to, but in the long term, when we get the withdrawal of the territorial claim, then the Union will be stronger than before". That remark has not been denied by the British Cabinet Minister in question.

The Taoiseach has a duty to state clearly and unequivocally whether he or anyone else representing the Government gave the British Government to understand that there would be a referendum on Articles 2 and 3. The British Secretary of State for Northern Ireland, Mr. King, has never made any secret of his view that the Hillsborough Agreement is "a bulwark against a united Ireland". If this Government were to succeed in removing Articles 2 and 3 from our Constitution that would, of course, complement and support Article 1 of the Hillsborough Agreement and strengthen Partition and the Union more than ever.

The recent referendum campaign brought into sharp focus the part played in our public affairs by opinion polls. This is something to which perhaps this House should turn its attention. I want to congratulate Deputy Prendergast for raising it. I think the political parties should examine, carefully and responsibly whether the activities of these opinion polls is improving political life, or otherwise. The credibility of these polls has been severely undermined.

It is quite obvious from the referendum results that the state of the art of public opinion polling in Ireland is not very sophisticated. Over a period of three years one firm, Irish Marketing Surveys, a company which is closely associated with the Independent Newspaper Group, built up a profile of public opinion which was supposed to be in favour of the introduction of divorce in a restricted form. First of all, we must ask ourselves: are these polls conducted honestly and scientifically? Are they in any way open to abuse, and could they, or have they been used, in any way to try to manipulate public opinion?

In a situation where politicians — some more than others — may be influenced by polls and make decisions on what the polls purport to show, I think there may be a case for ensuring that they conform to certain criteria and standards. We all know that some politicians recently changed their political allegiances on the basis of their reading of opinion polls. Should these politicians be protected from misleading polls, or should we take the view that they should be better able to look after themselves?

There is also the question of the possibility of attempts to use opinion polls during the course of an election campaign to influence the result. In France, I understand, the publication of opinion polls during election campaigns is not allowed. Perhaps we should consider whether we should have some similar restrictions here.

The Taoiseach's political diatribe yesterday is indicative of the whole approach of this discredited Government. His constant tactic is to attack Fianna Fáil rather than try to expound Government policy or deal constructively with the urgent problems confronting our people today. In debate after debate in this House, since he became Taoiseach, he has spent most of his time in sterile party political attack and point scoring.

This Government are party politically motivated in everything they do. Their handling of appointments to State companies and agencies has been outrageous. It is not just that almost without exception persons have been appointed to these boards and agencies on the basis of their party political affiliations, undesirable though that may be. The really distasteful aspect of the behaviour of this Government in this area is the manner in which some excellent people, who had clearly demonstrated their worth by the contribution they had made to the organisations concerned, were summarily, and often discourteously, removed to make way for party political appointees.

It is now widely accepted that this Taoiseach is out of touch and totally devoid of political balance and judgement, as the outcome of the referendum clearly proved. But let me give you some quotations from his speech yesterday which I believe completely confirm the unreality of the world in which he is now living. He made the following extraordinary statement: "Both those at work and those relying on social welfare payments will begin to experience a considerable and noticeable improvement in their standard of living". I know that many tens of thousands of our people who are suffering severe hardship and deprivation under the inadequate social welfare provisions made by this Government and the tens of thousands of young people who are now facing emigration will regard that as nothing less than cynical, dishonest pie in the sky.

Speaking about the recent meeting of Heads of Government in Europe, the Taoiseach also, made this statement: "Overall, the European Council's conclusions on agricultural policy in the international context were satisfactory from this country's point of view". Irish farmers from every part of the country, who are experiencing the most serious difficulties they have ever known and are facing bankruptcy, will treat that particular piece of pious humbug with the contempt it deserves.

I think pride of place however, must go to the following gem: "We shall continue to provide the kind of honest dynamic and imaginative Government which has enabled us to come through one of the worst recessions since the 1930s". In the face of all the dreadful statistics with which he is confronted; with mass unemployment still rising, with devastating and demoralising levels of emigration, with exorbitantly high tax levels, with current budget deficits year after year involving unprecedented increases in the national debt, with vital public services such as health, education, welfare and even the level of policing being run down to dangerously low levels, how can the Taoiseach, faced with all this, dare come before this House and submit us to such rubbish?

It was with some incredulity that I read an item in Wednesday's The Irish Times that Fine Gael's draft taxation policy for the next general election was being finalised under the chairmanship of Deputy Richard Bruton — not Deputy John Bruton. What sort of unreal exercise is this? Fine Gael made a whole host of promises of £9.60 for the housewives, reducing the standard rate of tax to 25 per cent and so on in their June 1981 election manifesto which they have never implemented and which they are trying to forget. Other promises were made in the Joint Programme for Government, which have also not been implemented. Have the Fine Gael Party not been in power now for three and a half years and had every opportunity to implement whatever tax policies they have? The Fine Gael Party have no credibility left on taxation. They are the party of broken tax promises. I want to warn them not to try it again under any guise. They will only arouse indignation and anger amongst the taxpayers of this country who have been crucified by the taxes Fine Gael have imposed in the past three and a half years.

They are probably the most unpopular and most unsuccessful Government we have had in our history. They cannot get anything right or achieve anything on any front. After nearly four years in office they have not a single substantial or durable achievement to their name.

An initial fiscal rectitude stance, which was really only a platform from which to attack Fianna Fáil, soon fizzled out and gave way to barefaced financial opportunism like the recent announcements of £7 million to sweep up the Phoenix Park or £10 million to take down signs in O'Connell Street or an unknown commitment for Bewleys Oriental Cafes.

The financial policies pursued by this Government have failed completely to achieve their objectives and at the same time have done enormous social and psychological damage. They have created antagonism, division and alienation. They are divisive in practically everything they do. Our nation has lost its way, with people turning against each other, each section blaming some other section for being responsible for the present mess. This dreadful defeatist outlook which has taken hold in our national community shows up most clearly in the figures for people seeking to emigrate permanently because they have lost confidence in the future of this country. This is the direct result of ineffective bungling and bad Government.

Fianna Fáil duty will be to re-establish a sense of national unity derived from a broad consensus leading to policies which are in the best interest of all sections of the community. I wish to ask every Deputy in this House, individually and personally to assess the policies and performance of this Government and to vote accordingly.

This Government have brought mass unemployment, an appalling level of emigration and high taxation. That situation is still getting worse and will continue to do so until Dáil Éireann decides to bring it to an end. It is so disastrously bad that the Irish Congress of Trade Unions have taken the historically unprecedented step of calling on this Government to resign. Every Deputy who votes with the Government shares responsibility for the policies of the Government and the appalling results of those policies. There is a heavy political responsibility on Deputies at this time.

Basically this Government cannot govern. Deputies must decide how long more, for party, personal or whatever other reasons, they are going to leave our country in this desperate situation. This House must sooner or later act in the interest of the people and end this discredited administration. I appeal to them to act now because the people are watching, the people know what the situation is and their electoral treatment of those who are prolonging the agony will be all the more merciless the longer it is delayed.

Mr. Wilson

How can you educate them when they will not come to school?

(Interruptions.)

Mr. J. O'Keeffe

Get back to reality now.

Mr. Haughey

I hope my speech has not caused an emergency meeting of the Cabinet.

Mr. M. O'Leary

In this Adjournment Debate it is natural that one should make some reference to the recent referendum, but I hold with other Deputies who have contributed from both sides of the House that it is the economic problems which must chiefly command our attention at this time. On that referendum, like other Deputies, I respect the right of the electtorate to make their decision and I accept it fully, but I would be less than honest if I did not say I consider the result represents a back to the future decision. Instead of registering an important step towards the cleansing of our fundamental law of all confessional bias we have confirmed in the referendum the inclusion of Article 41 in the Constitution half a century after its first appearance. Almost in the words of the adman's sale for Irish butter, it could be said the result is that we seem to be saying that Article 41 is part of what we are. I do not disparage the electorate for their decision. They are perfectly entitled to make that decision, but I do not see the decision as a gain for the State in the problems it has in the marital and other spheres. I make no disparagement of the decision, but I do not think it advances us towards the solution of any of our problems.

If I have contempt for anybody in the wake of this referendum —"wake" may be the right word — it is for the 50 per cent of our electorate who did not vote at all. To them, I must say, I can extend no understanding and no sympathy. What twilight zone do they inhabit, the 50 per cent of our electorate who did not consider the matter worth expressing a view on? One may respect, on whatever side they voted, those who did vote for whatever reason, but one can have nothing but contempt for those who did not consider the issue worth coming out to cast their vote. Many of those who did not vote must have known of families with marital problems. I am driven to the conclusion that those who did not vote belong to that large group in our society — they have their representatives in this House as well — who, when anything controversial is on the agenda, prefer to pass on the other side, those who belong to the "mind you, I said nothing" brigade. For that group who did not vote, who did not consider it worthwhile to come out and give their view I have contempt, and that group find faithful expression here in this House, in all parties.

When will the matter rejected last week be next on the national agenda? On this side of the year 2000? Certainly many Deputies in the conventional political wisdom of this House will come to the conclusion that they have been confirmed in their fear that this issue should never be touched and that any treatment of it should be put off into the far distant future. The result confirms the fears of those Deputies who belong to that grouping which transcends all party divisions in this House, the "mind you, I said nothing" brigade, the fears of those Deputies who consider that the Constitution should not be touched, those who from the very start saw the issue as a departure from what they consider to be the normal round of a Deputy's life, normal politics as they see it. That round consists of making representations on this or that issue to various people and who see their representative role as constituting the staple ingredients of what should be normal politics. Many Deputies see the role of the TD as the friendly broker bearing the constituents' demands to the Minister or the Department concerned. Many TDs see their role solely as conduits between constituents and authority exclusively. In their view TDs should never enter controversial areas and their voices should never be heard on matters on which there is a likelihood of losing votes. That approach to politics permeates much of Dáil proceedings. Such an attitude by TDs to their role which deliberately eschews the expression of views which might be controversial accounts for the low estimate many members of the public have for the role of the TD.

What should be an honorable avocation, being a TD, is today regarded by many people as a kind of fixer, a direct descendent of the tangler at the old fairs which predated the cattle marts of today. I am not arguing against the necessity for having a TD representing community interests in his or her constituency or being available to deal with their problems in clinics. I have to do that and I am sure the same applies to all Members of the House. I argue against that exclusive interpretation of the TD's role as a conduit for constituents' demands. Perhaps there is an interaction between the large number, almost 50 per cent, who did not consider the issue worth voting on and the parties in here, those Deputies who from the start said that the referendum should never have been embarked on, that it was a controversial area and a departure from what they regarded as a TD's main role.

The chief matter which should occupy us in what is left of the Adjournment Debate should be the question of unemployment. I do not hold the view that there is a dichotomy between social and economic policies. I see them as part of the same seamless garment. Many politicians go no further than saying that unemployment is our biggest problem. They make the ritual pronouncements about the challenge of youth, the waste of human enterprise and so on. However, too many Members of this House consider their effort over by making this ritual genuflection to the spectre of unemployment. Their speeches are strong in sentiment but scarce in solutions, which is not to pretend that solutions are easy.

I have a few suggestions which I hope the Government will take up or at least examine. In relation to the economy, all the indicators suggest that there will be a rise in consumer demand towards the latter end of this year and if the Government, in alliance with the private sector, can respond to that demand, recovery can be sustained. Will our productive sectors be in a position to capture whatever modest consumer boom may take place? If they are in a position to capture the improvement in the home productive sector, there is a real possibility that our recovery could be sustained with a beneficial influence on the high levels of unemployment. Unless we make the arrangements now to make that possible, the increased consumer demand will only benefit imports instead of home produced goods. If that happens the long awaited forecast of improvement in our economic affairs will not occur. Will our industry be in a position to meet the demand or will such demand leak out of the economy in imports? If we are capable of responding to it, the recovery will assist the reduction in unemployment.

I have seven suggestions to make in what the Government could see as an alliance with the enterprise programme for the remainder of this year and next. The enterprise allowance scheme should be changed. It is a good scheme which gives two options to the unemployed; they can utilise money on a weekly basis for a proposed business, or they can apply for a capital sum on six months of their benefit for the year in question. They might use this capital to open a shop, to buy a van or to make a down payment on something which would help them to start a business. I am referring to small businesses employing one or two people but, nonetheless, if it happened on a larger scale it would improve the depressing climate of pessimism which exists in too many estates and housing schemes all over the country where whole families are out of work.

The scheme envisaged that those who qualified for unemployment benefit should be in a position to utilise their benefit for six months as capital, where a project was considered suitable for investment. I know of unemployed men and women who sought to rescue themselves from unemployment and to utilise this but who were turned down. From my examination of the scheme the part which should operate to permit people to capitalise on their unemployment benefit is a dead letter. It does not operate because Civil Service regulations have ensured that nobody may qualify. I appreciate that civil servants running the scheme are anxious that no public money is wasted; but, as I said, nobody seems to qualify. The bureaucrats have subjected the scheme to such onerous conditions that it can be considered virtually withdrawn in respect of the capitalisation end.

I believe that should be relaunched to permit anyone on unemployment benefit with a suitable viable project to capitalise his unemployment benefit for a six month period. It should be an automatic right for anyone on unemployment benefit to avail of their unemployment benefit to furnish capital to start their own business. The Minister has often lectured the unemployed about the danger of acquiescing in their position. But we find ordinary men and women attempting to do something about taking control of their own lives and finding that bureaucracy will not permit them to capitalise their unemployment benefit.

I would suggest that the vetting of these projects should be taken out of the hands of civil servants and handed over to regional voluntary boards of businessmen currently involved in the practical affairs of running a business. Nobody without such experience should be given the impossible task of assessing the viability of a real project.

The second point I would make is that interest rates are high here and low elsewhere at the moment. How may we encourage firms to borrow funds from abroad where the interest rates are cheaper? If firms could obtain investment funds from abroad at the moment, this would help in depressing interest rates and reduce the differential between the cost of borrowing here and that of borrowing abroad. The very large firms are doing this. But small firms who really need it are worried about currency fluctuations and, therefore, do not borrow for investment purposes in the markets that are most competitive.

I suggest that the Government should set up an exchange rate cover fund which could be done at small national cost and would be a major stimulus to investment while reducing the cost of funds to indigenous industry. It would have the national benefit of bringing down our interest rates. There would be small national cost and, since there is little real possibility of alteration in the relationship of our rate to the other currencies in the EMS, there would be little risk and there would be solid encouragement to smaller firms at present inhibited from so doing from natural fear that they would be totally exposed. If the Government were to give them this exchange rate cover fund for a period ahead, it would enable them to strengthen up at this stage to avail of the opportunity we hope is coming in a few months time with consumer demand improving.

The relationship of the Irish pound to sterling, at 90p to the £1 sterling, is making the competitive position of the older firms selling into the British market very difficult indeed. Many spokesmen for these industries have called on the Government to alter the exchange rate between our punt and the British pound. This would be a wrong step but the substance of the demand is real. Their goods are facing difficulty on the British market at the moment. We should introduce a temporary scheme to assist firms currently selling into the British market to break into other European markets. The CTT should be given additional funds to implement such a scheme. There are large sections of indigenous industry, clothing, furniture, the food sector, based on the British market where the currency relationship is putting up the cost of our goods — there has been a 15 per cent increase in the cost of our goods as a result of the alteration between our punt and the £1 sterling in the last six months.

We should assist these firms over the period ahead until a different relationship is achieved between the two currencies. We should assist them to pursue energetically other markets. Britain, being outside the EMS, has been playing a particular line with our currency and it has impacted more on us than on any other EC country because of our dependence on that market. Their cost structure has worked against us and I would suggest that CTT should make a very valiant effort to assist those firms over the period ahead to break into European markets.

The fourth proposal is to get the banks to invest in enterprise. The Government should encourage the banks to put equity into new enterprises, offering job expansion at a local level. In this connection I am thinking of each of the banks being asked to contribute £5 million. The Government should then reassess the size of the bank levy in the light of the response the banks make to such a proposal. The extent of what can happen where funds are made available for initiative at local level was seen in the recent Band Aid concert. I suggest that the banks co-ordinate on a permanent basis what Band Aid has done in a once off effort. In fact, one of the banks does something similar at present but there is only £0.5 million available for a business scheme. I suggest that the banks together set up this enterprise which would attempt to assist suitable local energy. It is not simply enough for the Government to respond to opportunities or difficulties. We must get the great financial institutions involved and the banks will have a crucial role to play here. One of the tasks before the Government is to get enterprise in the country willing to take the risks ahead if this consumer boom is to be channelled for our own purposes.

I should have said that in relation to proposal No. 3, the one in which extra assistance would be given by CTT for firms based in the British market to seek markets in Europe, that the extra costing which would not be great for CTT's extra effort in this area could come from a diversion of funds at present spent in training for that purpose. There are at present many people in training schemes with no prospect of jobs and I suggest that CTT, by making an extra effort, could assist these indigenous firms who are for the most part totally dependent on the British market to energetically seek fresh outlets in the economies of the other EC states whose consumers have more money to spend this year.

The fifth proposal is one I made before, that firms employing less than ten people and firms starting up should be exempt from all tax and bureaucracy for a year so that they will not be retarded in their growth by too much red tape.

There are risks in all these proposals but, unless we stop making ritual statements about unemployment and come up with actual proposals, the unemployed can reasonably look at this assembly and say we are offering them nothing that gives them hope.

The sixth point is that business apparently wish to receive proof positive before they are ready to invest. As I said, the co-operation of enterprise business in general is essential if we are to make some progress. So, as an indicator of the Government's confidence in the expected improvement in the economy, the Government should bring forward items on their capital programme from next year to this year. As an indicator of the Government's confidence in the expected improvement in the economy, the Government should bring items from their capital programme for next year forward to this year. I am not asking for an increase in capital expenditure, but the bringing forward of schemes for hospitals, roadworks and so on already agreed upon. If a scheme is good enough to be financed by borrowing next year, the same should hold for this year. If businessmen need proof positive that the Government believe what they say, this is a very concrete way of manifesting that confidence.

The seventh point I am suggesting is that the Government reduce VAT on house prices. Some spokesmen for the construction industry have already made that suggestion. High prices for houses make it difficult for some to raise the money for the deposit and purchase price. There would be benefit to the consumer and to employment in the industry if the price of houses could be reduced in this way. How will that be financed? Our fancies might take wing if we were not tied to a price tag for everything we propose. I suggest we need to reduce the house purchase grant. It is of no use to the consumer as long as house prices remain as they are. Over the entire area of housing the Government should examine all the fiscal involvement in the construction industry to see how the whole question in the area of value to the consumer and expansion of employment could be optimised.

Let me finish on the matter on which I commenced, the fall-out from the referendum result. Listening to the Leader of the Opposition today — and I am speaking without any effort at irony — he has the laudable ambition of securing an honourable and serious mention in the history of this period. I cannot believe, however, that the role of the Opposition party, which he leads, in the run-up to and the actual conduct of the referendum will convince those who read the history of this period in the future. It might be considered an ineffectual rebuke to make of the Opposition party's conduct, although I do not think so, to say that their behaviour in this matter cannot be reconciled with the central thrust of classical republicanism, as I understand it, the central thrust that denominational influences must be removed from our national life. This requirement that it must be contained is not merely a matter of fidelity to historical movements and models in the past in a country where real political divisions are attached to religious differences. It remains as true now as in Tone's day that an Irish State must demonstrate a settled determination not to permit confessional bias to be represented in fundamental laws. Basically, that is my objection to Article 44.

Nullity, is no answer. Our proposal says that the courts, after looking at the matter, would decide. Nullity simply seems to hand that right over to psychiatrists. That is not the answer human beings with respect for their relationships with other human beings would accept in the majority of cases. It does not answer the full problem. I do not know when we will come back to that problem, but I remain sad that the main Opposition party, whatever else they may have gained from their conduct in the referendum campaign, cannot in good faith go to any commemoration ceremony this year for the father of Irish republicanism — not in good faith.

Mr. G. Collins

Is olc an scéal é nach bhfuil rud ar bith déanta ag an gComhrialtas ar son na mílte daoine atá dí-fhostaithe ar fud na tíre, go mór-mhór na mílte daoine óga, níos mó ná ceathrú milliúin daoine go léir, atá ag lorg postanna dóibh féin i dtreo go mbeadh seans acu fanúint agus cónaí sa tír seo. Ba cheart go mbeadh náire ar an gComhrialtas gach maidin ó Luan go hAoine nuair is féidir leo na mílte daoine óga a fheiceáil taobh amuigh de na hambasáidí — Ambasáid na Stáit Aontaithe, Ambasáid na hÁstráile, Ambasáid Cheanada agus iad go léir ag lorg ceadúnas oibre sna tíortha sin. Is olc an scéal é freisin nach bhfuil rud ar bith déanta ag an gComhrialtas ar son feirmeoirí na hÉireann.

Any review of the performance of this Government will surely provide an extensive catalogue of negative developments and, certainly, precious few positive achievements during their term of office. The 1982 election manifestos that trumpeted the aims and objectives, determinedly stated and confidently made promises of the Fine Gael and Labour Parties, will provide a sickening contrast to the achievements of the Coalition Government to date.

It is only with the benefit of hindsight that the Irish people will see and appreciate the cynicism of this incompetent Government. It is only when achievement is measured against promises that the people will realise the extent of the trick that was perpetrated at the last election, when the marketing experts, the packagers, packaged Deputy Dr. FitzGerald as the clean cool hero, the Stevie Silvermint of Irish political life who would crusade for a new tomorrow and who would right the diagnosed economic ailments of the nation. At the end of the fourth year of this failed Government, it is perfectly obvious that the good doctor most certainly got the treatment wrong. He inveigled the Irish electorate into committing the country to his care and undoubtedly he has proved a poor manager of the country's economic health. The haemorrhage of emigration is draining the country's vitality, while the tumour of unemployment spreads and strangles the country into a depressive and submissive apathy.

Farming, which is the very heart of this country's life, is strained under the sustained harshness and rigours of a hostile environment in the European Community, under huge interest rates combined with the consequences of prolonged bad weather. Yet, on looking to the Government for relief the response to the industry was totally inadequate. It can only herald a serious decline in Irish farming in the future. Representing a farming constituency, I say the farming problem is at crisis level. The combination of bad weather, declining prices and rising production costs is imposing such an acute financial strain on farmers that many are facing bankruptcy and the sale of their farms. That statement is based on my experiences as a public representative in County Limerick.

The fabric of Irish agriculture is in danger of disintegrating unless something is done. The welfare of Irish farmers in recent years is in direct sequence to the lack of commitment by the Government to the industry. The gains to the industry that arose in the years following entry to the EC have in the past three and a half years been seriously eroded to the extent that the future of many farmers is in very serious jeopardy.

It is indicative of the deep-rootedness of the crises in recent weeks that, even with the much improved weather which gave us excellent growth, the fodder crisis is still acute in some parts of the country. We have all read in the newspapers that there has been a marked increase in the incidence of suicide among farmers. Nobody wants the spectre of death, everybody is afraid of dispossession and the fear of eviction haunts many farmers who some short years ago were people of substance with a confident faith in their future. Now, their starving stocks, their mortgaged holdings and their lack of hope cries out for a generous intervention by the Government; but, unfortunately, the response is all too inadequate.

I could fill the short time available to me for my contribution to this debate giving details of cases I am familiar with in County Limerick. I am aware of small farmers, thrifty and careful people who are now in a state of ruin and facing disaster. I have had to accompany farmers, in County Limerick, to the lending institutions to try to renegotiate their loans and debts for them. I have had to try "to stop the clock" as far as interest charges are concerned so that the farmers would have some hope for the future. These farmers want to pay off the legitimate debts incurred by them for the purpose of survival but they must be able to renegotiate their loans. It is unfortunate that I do not have time to highlight those many cases today.

No Member can challenge what I have said because rural Deputies must see the scene for themselves. I am aware of farmers who have had to try to sell their milk quotas, which is their "lifeline for survival", because they were under pressure from certain institutions to pay off part of what they owe. If those milk quotas are sold the farm is no longer a dairy farm and its value decreases considerably. Emigration faces many families. I am aware that many families face mental torture trying to sort out their problems. The response from the Government was grossly inadequate and showed that they are totally out of touch with what is going on. It may be that those responsible for agriculture in Government are not listened to by others who do not have any great concern for farmers.

The cheap grain vouchers, and the general scheme adopted last autumn, failed to address the problem. Many cattle have died and many more are in poor condition. The harsh weather of the spring postponed nature's rescue. I have had to plead with the Land Commission on behalf of farmers to postpone the annuities due to them on 1 May until July because of the poor condition of the stock and the poor prices on the market for same. I went recently to the commission and pleaded for an exemption for those farmers until the autumn in the hope that conditions and prices improve. We should and must try to do something to help those farmers.

Nature's rescue might have been more successful if the Government had not abandoned the lime and fertiliser schemes which proved of great assistance to farmers in the last three and a half years. It is difficult to imagine that the Government failed to appreciate the scope and depth of this problem — if they did their failure to deal with it is unforgiveable. If they failed to appreciate the seriousness of the problem, then they stand equally condemned. The Government are, it would appear, not only incompetent but also insensitive. In the eyes of the farming community, whose creamery cheques for the next year are mortgaged, the Government are doubly condemned.

Recently a senior financial executive of one of our major creameries told me that many farmers on his books have drawn all moneys they are likely to earn in the form of milk supplies to the creamery this year. He told me that the creamery had to draw the line and prevent farmers getting credit for 1987 because they could not cope with it.

The quality of farming output for a long time will suffer the consequences of neglect during the harsh weather of the past 18 months and the harsh Government of the past three and a half years. Crop yields this year are likely to be low arising from the retarded growth during the spring. The quality of milk has declined to the extent that creameries have reduced prices because of the low protein levels.

During the week two county councillors — one Labour and one Fianna Fáil — who were in Dublin for a meeting of the General Council of Committees of Agriculture told me that one creamery in their area paid out £5 million less than last year because of the drop in milk yields.

Stock quality has declined drastically. Cattle prices are lower than for two years. Undernourishment has led to loss of weight and death among cattle. Significantly the only exception to price decline in the cattle trade is the price of replacement calves. On Sunday a farmer from west Limerick told me that animals he kept during the winter and for who he had to buy fodder would have made £100 more per head had he the good luck to sell them last autumn. That farmer kept his animals hoping for a better price for a better finished animal at this time of year.

The implications for the country of the agricultural crises are appalling. Farmers who have not resources to replace lost stock are going to go to the wall. They will add to the numbers depending on social welfare and the precious resource of land which will go unused will deteriorate. The capacity of Northern Ireland farmers to come South and buy in advance next harvest's straw contrasts sharply with the impoverished status of many farmers down here. And, as always, it is the weak who suffer most. The small farmer who extended his borrowing in the hope of a brighter future is now stretched — many to breaking point — to meet his commitments. For every small farmer who succumbs to the strain of hardship it is another family thrown on to social welfare, another family broken and another community wounded.

In the name of humanity I appeal to the Government to look with compassion on the deprived and poorer regions of the country. We cannot afford the price of failure among the small farmers. Let us not reduce them to a level of subsistence but let us give them the resources and the incentives to rebuild their herds and upgrade their output.

Let us look at how the treatment of German farmers contrasts with the treatment of their Irish counterparts. German farmers are getting £165 million compensation this year for falling agricultural prices in the EC and on top of that they will get £66 million compensation for damage suffered as a result of the Chernobyl disaster. On top of that a further £50 million is given to the German farmers as a result of reclassification of over half of the total farmland in Germany as disadvantaged areas, although the quality of that land, the so-called disadvantaged, would be far superior to the quality of land in the west of Ireland.

Word should go from this House this morning to the Minister for Agriculture, wherever he might be, that I would like to hear him comment on what I have just said. He, our Minister, Deputy Austin Deasy, supported this measure. Does he not realise that, in allowing the German Government special treatment of their farmers, our Minister is providing them with an incentive to dismantle the Common Agricultural Policy. The attitude of this Government to EC farming aid is nothing short of disgraceful. Since taking office they have declined to take up, and have suspended, several EC support schemes to farmers. As a result, the prevailing attitude in many quarters in Brussels is that Irish agriculture obviously, or seemingly, does not need aid. The Commission must be excused and can be expected reasonably to assume that if we decline aid, therefore we do not need it.

In further contrast to the performance of the Government, let us look at the record of the Fianna Fáil Government of which I was a member during the period 1980-81. We made decisive interventions to stem the decline in farm finance and to cope with the effect of a wet summer at that time. The Irish farmer was given decisive support. A whole series of measures at national and EC levels were implemented to give the industry the support it needed. At the same time, we defended the Common Agricultural Policy resolutely. The present Minister, who is constantly under pressure, projects a very pugnacious image when he performs for the media, especially if he is encountering, what I might fairly describe as any richly deserved criticism. He does not seem to be much of a fighter where it would count, that is, at EC levels. Perhaps he might benefit from an adjustment of his demeanour.

It is with regret that I say on behalf of the farming community that he has not won one round yet at the negotiating table. I wish he would so do. I wish he would approach his responsibilities there with commonsense, with deep interest and with deep commitment on behalf of those who are, unfortunately, depending on him to try to help them. The Irish farmers cannot afford to continue being so badly represented in the forums of the EC. They certainly and very definitely deserve much better. They need help desperately. They need confidence primarily. They need grant aid towards revitalisation of their industry. They need low cost credit to facilitate development without the recurring threat of foreclosure.

The economic and social policies of this Government have been disastrous for farmers in particular and for the country in general. The Government have lost the confidence of the people as they stumble on ineptly, clinging not to any ideal whatsoever that anybody can see, but clinging to the trappings of office. It is regrettable that members of the Government parties are now saying today in Dáil Éireann: "We are in for a fine long summer break. There will be a six or seven week session only until Christmas. We will be back at the end of January and who knows what 1987 will bring." If that is not clinging to the trappings of office I would like somebody to explain the difference to me. Ideals have been left far behind. They were enunciated in the Joint Programme for Government. Every day they have been in Government, unfortunately, has made that document more irrelevant.

I want to ask: where is the promise to halt and reverse the growth in unemployment? What happened the promise that the PAYE sector would pay a smaller proportion of total tax? The tide of international recession hit its lowest point in 1982 when this Government took office. The flowing tide of recovery is rising internationally since then. This tide that we all believed would raise all boats has failed singularly to dislodge our economic ship from the mud flats because the Government have not provided any impetus to get us unstuck from the depressing and demoralising mess we were in. I say with regret that I felt a certain sympathy for Deputy Michael O'Leary a few minutes ago who, in his seven point plan for Government, advocated that VAT on the building industry should be removed. Deputy O'Leary voted for and supported the present rate of VAT on the building industry which destroyed this industry and reduced it to its worst state ever in the history of the State. Deputy O'Leary has forgotten that support which he gave for VAT on the building industry which he now suggests should be taken off.

We have been driven deeper and deeper into gloomy depths. Our unemployment has got even worse, by a colossal 30 per cent from 170,000 to 230,000. It is growing at the rate of 3,000 per month. Notwithstanding this spiralling increase in unemployment, emigration is also rocketing. It is estimated, conservatively no doubt, that it is now running to something in excess of 100,000 since the Coalition Government came into office.

On Tuesday, 1 July, Deputy John O'Leary from south Kerry put down a Parliamentary Question to the Taoiseach. From the answer it can be clearly seen that between June 1985 and May 1986, 64,000 people left this country. For the 12 months up to May 1985, 38,000 people left the country and for the 12 months before that another 10,000 left the country. These figures were given from the Taoiseach's office and they cannot be denied. When given they were taken by the handlers who tried to misrepresent them as if they were not so. I resent that. It is the truth. It is a shocking tragedy that these figures represent the cream of our country, the cream of our young people who are being forced to get out of the country where there is no hope for them whatsoever.

The Minister for Foreign Affairs may smile at me. I am sorry for that. I know he does not mean it. I hope he does not mean it. It is a fact that 100,000 young people have left this country. As I said shortly before the Minister came in, if the Minister and the Government, any morning of the week from Monday to Friday, could take time off to go and see the queues outside the American Embassy, the Australian Embassy or the Canadian Embassy they would not look as smug as they do at times and would not sneer at people like me, when they make the case for these young people. They are being forced to get out of the country because they cannot survive here.

An Leas-Cheann Comhairle

You have five minutes to conclude.

Mr. G. Collins

That is the shameful thing about it. Many people are in jobs which are not contributing to economic growth. The purpose of the exercise is to keep the figures down to, what is to the Government, an acceptable level of unemployment, a figure of 230,000 people. I have in mind schemes such as the social employment schemes and some of the levy-funded creations of the YEA and its satellite agencies. I want permanent, sustainable employment for our people, and social employment schemes, work experience programmes, social guarantees, and what have you, are not creating jobs. The work being undertaken may have laudable civic and social merits in many cases but it simply does not produce the prospect of sustainable employment. It is often providing a service which could not normally be afforded and which will not be continued once the funding is withdrawn.

Yet such part-time work is reckoned by the Government to be employment. It is not employment: it is only part-time work and it cannot be so regarded and sold by the handlers as full-time sustainable employment. The very basis of these projects owe more to the cosmetic propensities, that is, to keep up the appearance of employment. For God's sake, keep the figures down — that is the morning prayer of the Minister for Labour, who is Minister for unemployment, and social welfare. There is no serious motivation to tackle unemployment.

The Government promised to reduce the proportion of total tax paid by the PAYE sector. How does performance compare with promise? Predictably not very well, I am afraid. During the term of office of this Government personal taxation has been sharply increased. Any reduction in tax rates, which apply only to the taxable part of pay, were more than compensated for by the imposition of levies and the discontinuation of tax free allowance on interest paid. This exercise was ostensibly to stop the spendthrift abandon of the irresponsible consumer who could not get his well heeled Dublin 4 daddy to buy him or her the car, the furniture, the colour TV. Borrowing had to be discouraged because it was a bad habit, bad for economic health.

Of course the taxpayer was told all the time. "We are reducing your rates of tax". Let the taxpayers ask, "Did you reduce the amount we contributed"? The answer to that is a definite no. The amount was increased and its size in proportion to total tax was increased. From 1982 to 1986 the proportion of total tax accruing from income tax and levies rose from 36.8 per cent to 40.5 per cent. Within the income tax category the proportion paid by the PAYE sector as distinct from the self-employed has risen from 87 per cent in 1982 to 90.2 per cent in 1986. Income tax from PAYE in 1982 represented 31.3 per cent. In 1986 it represents 32.3 per cent, this with 230,000 unemployed. Surely this is adequate illustration of the abandonment of another promise by the Government.

It, like other promises, fell victim to an inept, incompetent Government that never deserved the confidence of the people. They gained the confidence of the people by projecting themselves as credible and competent administrators. They have lost the confidence of the people by their utter and abject failure to deliver on any simple promise of consequence which they outlined in their Programme for Government. They trumpeted from the roof tops, virtually, that they would phase out the current budget deficit. They apparently were determined to do this over four years. Then it became seven years. Now, almost four years on the deficit, far from being reduced, reached its highest level of £1,284 million last year, just over 8 per cent of GNP.

I have one question to ask of the Minister for Foreign Affairs. He may find time to tell us if he has any further news of the whereabouts of Mr. Brian Keenan, the Irish citizen who disappeared in Beirut a few months ago. Many people would be very anxious to hear whether any progress has been made in tracing him and if any indications have been received that he is still alive.

Minister for Foreign Affairs (Mr. P. Barry)

During my reply I will give the Deputy the latest information on Brian Keenan. If I do not get the information before I conclude I will send it to the Deputy privately. I am always amused at the great interest the Fianna Fáil spokesman on Foreign Affairs takes in matters of agriculture. A considerable portion of his speech this morning was devoted to it, as it frequently is. I presume his intention was to indicate to his Leader how much better he would be as spokesman on Agriculture than his colleague from the same constituency——

Mr. G. Collins

We remember when the Minister tried to talk on Finance. He could not even read his script.

Mr. P. Barry

I think the message has got across — the Deputy's Leader has got it. Having referred to his Leader, I will take up some of the points Deputy Haughey made this morning. I could not let Deputy Haughey's statement go that this Government are less active than their predecessors in opposition to apartheid. It is the Government's policy to oppose by all practical means the policy of apartheid, which is repugnant to all we stand for. It is because of our opposition to it that we have directed development assistance to Lesotho since the inception of the aid programme that the Government began in 1973. We believed then, and continue to do so, that we should assist a small country surrounded by South Africa to resist apartheid, and to develop in spite of a strong and hostile neighbour. It is this Government who introduced a ban on South African fruit and vegetable imports and it is we who decided to give grants to the International Defence and Aid Fund and to the Fund of the South African Council of Churches. These funds are used to defend political prisoners in South Africa. Their use is all the more necessary following the worsening political situation and increased oppression in South Africa.

We do not have to apologise for our record on South Africa. We will continue to argue within the Twelve and elsewhere for the imposition of effective, graduated, selective mandatory sanctions in order to bring home to the Government of South Africa the necessity to end apatheid and to treat all South African citizens equally, with dignity and justice.

Deputy Haughey charged this morning that officials in my Department are becoming politicised. That is a very unfair charge for any responsible politician to make about public servants. The officials of all Departments take their directions, as Deputy Haughey should well know — it is shameful that he should have put an opposing view on the record — from the Government of the day and faithfully administer the policies laid down by the Government, and no other policy. If there should be a change of Government in future — judging by the performances of Fianna Fáil recently I think that is most unlikely — then the public servants will execute the policies that the Government of the day direct them to administer.

Mr. G. Collins

It is no wonder the Minister was director of elections in the referendum.

Mr. P. Barry

Deputy Haughey also said that the consul-general in New York canvassed against the adoption of the MacBride Principles. This is false and was answered by me in the Dáil on 4 June. Following a number of inquiries, the consul-general wrote to the New York legislators enclosing a note giving the Irish Government's position on the MacBride Principles. The note indicated that, though the Government had no difficulty with the MacBride Principles, we were anxious to avoid any action that might lead to disinvestment or that might discourage investment. As I said on 4 June, the Government support the Principal aim, namely, the elimination of job discrimination on a religious basis in Northern Ireland.

I would like also to move on to the Anglo-Irish Agreement and to refer in particular to two aspects. First, the implementation of the Anglo-Irish Agreement through the work of the Intergovernmental Conference and, second, the establishment of the international fund for Ireland. In the last seven months the process of giving life to the Anglo-Irish Agreement has got under way. The Conference is well established. It has held six meetings, the most recent on 17 June at Belfast. It has become, as was intended, the instrument for the management of those aspects of Anglo-Irish relations which are set out in the agreement. Gradually, even among moderate Unionists, the agreement, the Conference and the Secretariat in Belfast are seen no longer as extraordinary things, but as part of the structures and processes of Government. The agreement will not self-destruct or be wished away.

Through the Conference, the Irish and British Governments are committed to work together for the accommodation of the rights and identities of the two traditions which exist in Northern Ireland and for peace, stability and prosperity throughout the island of Ireland. These are the broad aims: they are of immense importance to Nationalists. The role of the Irish Government in Northern Ireland affairs, and our right to speak for Nationalists are accepted and recognised in the agreement. We are acting accordingly.

I want to emphasise here the solid programme of work that is being undertaken by the Conference, the results that have been achieved so far and the results that I expect to come for the benefit of Nationalists in the North. The work is often of a highly technical nature. It involves indepth examination of the issues. The work is durable and far-reaching.

The early meetings of the Conference concentrated on relations between the security forces and the minority community in Northern Ireland, on ways of enhancing security co-operation between North and South and on measures which would give substantial expression to the aim of underlining the importance of public confidence in the administration of justice.

Since February of this year, officials have been meeting regularly to consider measures to enhance public confidence in the administration of justice and to report regularly to the Conference on progress on a wide range of measures, both legal and procedural. While it would not be appropriate to deal with matters which are the subject of ongoing discussions and negotiations within the Conference, I am satisfied that real progress is being made and that further significant progress is likely in the near future.

Most recently, on 19 June, notice of a substantial number of amendments to the Emergency Provisions Act, 1978, was given in the House of Commons. The amendments are a positive reaction to the concerns and grievances which have been voiced by Nationalists since this legislation was first introduced in 1973. Many of the provisions of this legislation, some of which will now be reformed, are re-enactments of provisions in the Northern Ireland Special Powers legislation which goes back to 1922. In particular, the new amendments will bring a welcome improvement in the provisions covering the admissibility of evidence; the granting of bail; the rights of suspects in custody and the security forces' power of arrest, search and seizure.

These are the more important amendments to the Emergency Provisions Act. Further changes are being made which should reduce delays in the court system and secure more trails by jury. One of the central aims of the Anglo-Irish Agreement is the improvement of relations between the security forces and the minority community. In this context, the Conference has reviewed progress in the application of the principle that the armed forces, including the UDR, operate only in support of the civil power. There has been progress in the implementation of this policy, a policy which will ultimately provide the minority with a substantial safeguard in its dealings with the security forces. We are pressing ahead towards the aim of full RUC accompaniment of military patrols, including the UDR patrols, in their contacts with the community.

In addition to these items, many of which are complex and on which discussions are continuing, we have put forward views and proposals on all the major areas covered in the agreement. These include: electoral arrangements in Northern Ireland, cultural heritage, flags and emblems legislation, economic and social discrimination, a Bill of Rights for Northern Ireland, as well as major policy issues, such as housing in Northern Ireland which is of particular interest to Nationalists. We have dealt also with items such as the role and composition of public bodies in Northern Ireland, prisons policy, and cross-Border economic, social and cultural co-operation.

That is a long list, but it shows that the work has begun in earnest, and that issues of real importance to Nationalists in Northern Ireland are being taken up.

There have been results in these areas also. I refer in particular to the reform of the legislation relating to "I" voters. The British Government have also given a preliminary and encouraging response to our representations regarding Irish language and culture. The details have been set out in the joint statement issued after the meeting of the Conference of 17 June last and which has been laid before the House.

I point to these achievements and underline them. The agreement has its opponents and its detractors, both North and South. Some, like the Northern Unionists leaders, are particularly vocal in their opposition, much of which is based on deliberate misinterpretation. Others, like the paramilitaries on both sides, the men of violence, write off the agreement; but they fear what it stands for. Others catch at straws. I refer to claims that the agreement is affected by change or the lack of change of our Constitution whether Article 41 or Articles 2 or 3.

The Opposition should have more sense than to chase some of the red herrings they have recently been doing. Earlier this week, Deputy Collins, their Foreign Affairs spokesman, put down a Private Notice Question, which was not allowed, asking me to comment on a statement which had been made at a press conference by James Molyneaux repeating a rumour he had heard 12 months ago. The Deputy ought to have more sense than to help Mr. Molyneaux to spread his red herrings. It would not be sensible of me, even if the question had been allowed, to make a statement about remarks Mr. Molyneaux had made on claims he heard from Mr. Tebbit a year ago.

As to the question of a referendum on Articles 2 and 3, the Government have no intention of seeking such a referendum. The referendum on divorce had nothing to do whatever with the question of Articles 2 and 3 and the Government had no plans for a referendum on Articles 2 and 3 in the event of the divorce referendum succeeding. What I have said is a repeat of what the Taoiseach said at a press conference in November last, when he was asked almost the same question about changing Articles 2 and 3 of the Constitution. That was at the time of the signing of the Hillsborough Agreement. The Taoiseach said, on the point about the Constitution, that there was no proposal to change the Constitution. That is not something which arises from this agreement which is to be undertaken within the framework of our existing constitutional situation. That is still the position. It is regrettable that Deputy Collins should allow himself to chase that red herring.

What I say is this: The agreement stands as it was negotiated and agreed between two Governments. The Conference and the Secretariat in Belfast are the machinery for implementing the agreement. Our work under the agreement will succeed because it sets out clearly the rights of Nationalists in the North and the need to accommodate their rights, because of the solid benefits — the results — that the agreement is bringing progressively for Nationalists, and because it is in the interests of both Governments that their co-operative efforts should succeed. The agreement will benefit Unionists as well as Nationalists because it will bring peace, reconciliation and stability.

In the immediate period ahead we will press on with the work of the Conference in all the areas I have mentioned. We are faced, of course, at present with the marching season in the North. During this period I will be most concerned to ensure that the lives and property of Nationalists — of Catholics — in the North are fully protected and that the police carry out their duties in a professional and even-handed way.

I should like to pay tribute now to the many members of the RUC who have suffered from the intimidation and violence of so-called loyalists in recent months, violence which they have borne solely because they have done their duty. I want also to say how deeply I regret the deaths of officers of the RUC and the other members of the security forces in Northern Ireland at the hands of the IRA gunmen. The IRA are trying to bring down the Anglo-Irish Agreement. The determination of all those who support the agreement will ensure that they do not succeed.

In the longer term our aim is to achieve a devolved Government in Northern Ireland on a basis that Nationalists and Unionists can accept. We want to see Nationalists play a full part in the structures and processes of Government, as is their right. We want to see an end, as I have said so often, to Nationalists alienation.

The second major item I want to mention is the International Fund for Ireland. On the afternoon of Wednesday of this week, the President of the United States signed into law a contribution of US $50 million in cash in the US fiscal year 1986 for the International Fund. I know that every Member of the House will join me in expressing appreciation to President Reagan, to the US Congress, and to the American people for this important and historic contribution. We must thank also Speaker O'Neill and the Friends of Ireland in Congress for their invaluable support.

The money will be paid from the Economic Support Fund administered by the State Department. There are no strings attached and no conditions, apart from the normal provisions for accountability. The cash contribution has been voted for one year only, but a further Bill authorising US contributions to the International Fund for the five fiscal years 1986-1990 will soon be voted by Congress.

The contribution to the fund is a significant statement of political support: it means that the people of the United States share our belief that peace and reconciliation in this country are realistic objectives and that they want to back up that belief with a tangible gesture of support. It means that they recognise that the Anglo-Irish Agreement is the proper instrument for translating that belief into reality.

The objects of the International Fund are based on article 10 of the Anglo-Irish Agreement, namely, "to promote the economic and social development of both parts of Ireland which have suffered most severely from the instability of recent years". The fund will also encourage contact, dialogue and reconciliation between Nationalists and Unionists throughout Ireland in accordance with the overall aims of the agreement.

The Irish and British Governments will decide very soon on the formal arrangements for the fund. These arrangements will provide for the fund to be administered by a board which will be representative of the interests of both Irish traditions, North and South. The two Governments will appoint jointly the chairman and the members of the board and will soon announce their names. The board will act independently and will not receive instructions from Governments. The board will consider applications for asistance which will be submitted to it through the two Governments. If the board is satisfied that the applications meet the objectives of the fund, it may authorise grants or loans for the projects for which assistance is sought. The board will be assisted by an advisory committee composed of representatives of the two Governments.

Because of the special problems in Northern Ireland, about three quarters of the fund will be spent on projects in the North. The rest will be spent here. The fund will concentrate on stimulating private investment and enterprise in both parts of Ireland, aiding infrastructural development where such development will be additional to existing programmes and encouraging voluntary efforts for peace and reconciliation.

Apart from the US Government's contribution, the British and Irish Governments have also been in touch with the Governments of Canada and Australia. We expect a positive response. We have been discussing also how best the European Community might express its declared support.

This practical assistance for Ireland, North and South, provides an important international element of support for the principles and aims of the Anglo-Irish Agreement. It gives recognition also to the continuing importance of the links between the peoples of this island and those people abroad with whom they have been particularly connected through kinship and history. On behalf of the Government I would like to say how deeply I appreciate this support.

Deputy Collins also asked me about Brian Keenan. Unfortunately, there is no news yet. Representations and contacts at all possible levels are continuing and we have been provided with co-operation by people of influence in the area. The fact that some people have been released there is a hopeful sign. During his recent visit to the Lebanon, the Minister for Defence went to West Beirut particularly to add his weight to the effort to secure the release of Brian Keenan. I hope that his efforts and those of our diplomats in the area as well as of people of goodwill around the world will have a desirable effect. I want to refer briefly to Libya. I undertook last week to inform the Dáil of the outcome of the discussions which our Ambassador at Rome — who is accredited to Libya — has been having in the Libyan capital, Tripoli.

The background was the concern which I expressed at the reports of Libya renewing its support for the IRA. These reports originated from a press interview given by a European Parliamentary delegation in Tripoli after their meeting with Major General Jalloud.

I stated in the Dáil on 18 June, and again on 25 June, that any foreign Government that supports the activities of the Provisional IRA — morally or materially — is behaving in an unfriendly way; and I said that I was seeking firm assurances from the Libyan Government that they will not encourage the IRA in any way, or have contact with members of the IRA.

The Ambassador has had discussions in Tripoli — most recently on 1 July — with the Libyan authorities. Throughout these discussions with the Libyan authorities the Ambassador has expressed the grave concern of the Irish Government about any support, or renewal of support by Libya for the Provisional IRA.

The Ambassador pointed out that the IRA is the enemy of the Irish State and of the democratically elected institutions of this State and he stressed that Libyan Government support, whether moral or material, for the Provisional IRA is absolutely unacceptable to us.

Successive Irish Governments have made repeated efforts to impress on the Libyan authorities the importance we attach to this issue. Indeed, an important reason for our entering into diplomatic relations with Libya in 1977 was to seek to correct Libyan misunderstanding of our policy of total rejection of the Provisional IRA. Most recently, in January of this year when an official Libyan diplomatic delegation from the People's Foreign Relations Bureau in Tripoli visited Dublin, we informed them of the Government's concern about LibyanIRA connections. We were told by them that Colonel Ghadafi did not support IRA activities.

The Ambassador has now reported on his discussions in Tripoli and I want to inform the Dáil of the result. The Libyan Foreign Relations Bureau, in a statement made to our Ambassador, has once again repeated the line that Libya has nothing to do with the IRA. I have taken careful note of the statement made to our Ambassador, but I have noted also the obvious difference between that statement and the remarks attributed to Major General Jalloud. The Government cannot accept that, notwithstanding the assurances received now or in the past, members of the Libyan leadership should express support for the IRA and repeat in public statements that support is or will be forthcoming for the IRA.

In the circumstances, it is my intention to continue to use our diplomatic link with Libya to impress on them the seriousness we attach to any outside support for the Provisional IRA, by way of statement or material support, and to underline to them our total commitment to the defeat of the IRA. We will pursue these concerns directly with the Libyan Government and within the framework of the common Twelve approach I have outlined in previous statements.

The conduct of normal relations between states must be based on a realistic assessment of mutual interest. This applies to states that have a democratic system like ours as well as to states such as Libya that are governed by other systems. On matters such as supporting terrorism, ambiguity is unacceptable. Libya must recognise that it is of fundamental interest to this State that no foreign Government should give even the slightest indication of support or of sympathy for the IRA. If that elementary fact is recognised and accepted, then a normal relationship is possible between this Government and the Government of Libya.

Mr. Reynolds

I welcome the statement by the Minister for Foreign Affairs giving details of the discussions of our Ambassador at Rome in Tripoli. It is the wish of all sides of the House that no support, either verbal or material, be given by any outside influence to the IRA. I am sure the Minister is aware that many press reports from Libya during the years have been found to lack veracity. One has always to be sceptical until one goes to the people concerned to find out exactly what was said. Even the German delegation——

Mr. P. Barry

I have checked it out.

Mr. Reynolds

The Minister is satisfied the statement was made? According to press reports, even the German delegation could not agree on what was said. This country wants no truck with the IRA and I join with the Minister in his comments on that matter.

We welcome the assistance of $50 million from the United States Government. I thought we might have heard from the Minister who was going to spend it and the kind of projects involved but, unfortunately, we were not told. Will the British Government have the final say? One of the projects I should like to see included for funding is the North-South Kinsale gas deal. If that had gone through it would have been the best flagship of North-South economic co-operation, and it could still be so if it were proceeded with even now. It would demonstrate to people in the North of Ireland that, while the British Government are not prepared to look after their interests in supplying them with natural gas, we are still ready, willing and able to do so. If we are to believe what we are told, the project fell through because of lack of funding and here is an ideal opportunity to restore that deal. It would be a practical demonstration of North-South economic co-operation and would do much more than all the pious platitudes expressed by some people in this House and in other places.

I regret to have to say that the Anglo-Irish Agreement has produced little or nothing so far. It has not achieved any improvement in the position of Nationalists in the North of Ireland and their situation is more or less the same as it was. Real economic co-operation is the prerequisite to building economic bridges. The intractable problems existing in the North will not not be solved overnight but will be solved by a process such as I have described. The restoration of the North-South gas deal should be the first step in building a bridge.

I listened to the Minister making snide remarks about the leader of my party. I was surprised a senior member of the Government did not take this opportunity to refute, if that were possible, the economic facts that Deputy Haughey put on the record of the House today. It is quite clear there are no answers. Deputy Haughey was not telling fairytales, such as emanate each day from the Taoiseach and other members of the Government. We have pointed out the economic facts that were taken from official records of events.

In one of the national newspapers today there was a banner headline, "We're looking good". It reminds me that the same words were uttered by the people in the control tower at NASA before the disintegration of the satellite in mid-air. The half-yearly Exchequer returns do not warrant the use of that expression. I should like to think that we were looking good but the opposite is the case. The Government should not try to deny the economic facts. They are there for all to see.

It is no wonder the Taoiseach and his Ministers have been found to be so much out of touch. He came to this House the other day with a long speech, a considerable portion of which was devoted to talk about telling the truth and not misleading the people. His whole statement was a misstatement of economic facts. Where is this country looking good? We have been hearing this kind of talk for the past three years. We have heard that the economy has turned the corner, that there is light at the end of the tunnel and now that we are looking good. I challenge any member of the Government before this debate is concluded to tell us what sector of the economy is looking good.

When I consider the OECD report produced last May, I wonder where all that information came from. It was completely out of touch and removed from reality in that they referred to a growth rate of 3½ per cent this year. This is at a time when we know we are heading for a nil rate of growth. We know that the information supplied for that report had to come from the Department of Finance. It named sectors of the economy where they predicted growth rates: it listed an increase in agricultural incomes, a lift-off in building and construction, an increase in tourism earnings and an increase in exports and imports. Let us consider each item separately.

Everyone knows that in the first half of this year there has been a drop of 10 per cent in agricultural incomes. I am not blaming the Government for the weather but I am pointing out the present position of agriculture. Can anyone really believe that in the second half of the year that 10 per cent drop will be reversed and growth will be achieved? It is an absolute nonsense to suggest that will happen.

The building and construction industry is now back to where it was in the worst days of the fifties. Cement sales, the best indicator of how the industry is progressing, show they are at 59 per cent of the 1979 figures. Yet, the OECD report, the Taoiseach and Ministers would like us to believe there will be an uplift in that industry. This country is bedevilled by experts and they have a good listening ear in the higher echelons of Government. The result is that every time the Government adopt all the theories and use the statistics given them by the experts, they end up in a worse position. After three and a half years in office the actions of this Government have left the country in a much worse economic situation. The cure has been worse than the disease.

The Government cannot deny that the national debt has increased to almost £21 billion. If they stay in office a little longer they will have doubled the national debt from the figure obtaining when they came into office. The unfortunate thing is that there has been no benefit for all the money that has been borrowed and spent.

The economic decisions of this Government leave much to be desired. The worst thing is that we are never given the facts. We are given guesstimates when major economic decisions are taken but invariably those guesstimates have been way off target. There is a shopping list of such guesstimates and I have not time to go into all of the instances now. However, I refer to the collapse of the ICI. We were told in this House the cost would be approximately £50 million. It is now in excess of £200 million and we do not know where it will finish. We were never told about the cost of the PMPA exercise. The Minister for Transport told us what would be the approximate end cost of the liquidation of Irish Shipping but now it transpires that no one knows where that will finish. Already the whole operation has cost for more than would have kept Irish Shipping going for five years. Was that a good economic decision?

Was the decision taken regarding the ICI a good economic decision? Even this week we saw in the half-yearly returns that there is a gap of £20 million in respect of Bord Gáis returns to the Exchequer. We are now told that is a "guesstimate" of the real position in Dublin Gas. Before this debate ends I challenge any member of the Government to tell me that the report of the receiver, which was submitted to the Government, shows that the write-off for Dublin Gas over the last 20 months was £79 million and that the projected losses for the next 12 months will be £14 million. What sort of Government would try to mislead us once again by giving us a guesstimate of £20 million.

It is no wonder the credibility of this Government and the Taoiseach is on the floor or that his personal appeal before the recent referendum were not listened to. When the people stop believing what their leader tells them, then he has a real problem — not to mention the other major problem in his own party where the knives are being sharpened. We can recognise this quite clearly because for a few years we had that experience ourselves. I look around this House and see the huddles of three or four Deputies, and an odd Minister here and there. I know from experience what that means. In the long hot summer maybe the knives will be fully sharpened. While Alice may have moved to Shatter-land, the Taoiseach still remains in wonderland, wondering how long the people will stand by him, or who will sink the first knife, or wondering if at the end of the day, like Caesar he will have to say "Et tu, Bruton". The forces are gathering in different directions.

It is a sad state of affairs that the economy is allowed to drift. Nobody can deny that because the Exchequer returns are there for all to see. We are talking about a consumer boom which is to lift this economy in the second half of the year. Let us look at the first half of the year and see what happened. There has been an increase in income tax of approximately £120 million over the same period last year, this from a Government which tried to tell us at budget time that they were lessening the burden of income tax on the PAYE sector. Stop that nonsense and stop moving figures around. This is reality. Also in the Exchequer figures we find that this Government budgeted for receipts of 11½ per cent in VAT and excise receipts, but at the half way stage they have only achieved 5½ per cent. What does that tell us? It tells us that consumer expenditure is so flat that the Government are only half way towards achieving their objective. We will have decreases in VAT in the second half of the year and this can only work still further against the Government achieving their target. Yet the Taoiseach wants us to believe that this magic consumer boom will solve every problem.

If the people get any extra money in their pocket everybody knows where it will go. I know the reality. I am not making political speeches when I say that every businessman will agree with what I am saying. The members of the executive council of CII are drawn from all over the country and they too will agree with what I am saying. I challenge anybody to say that even one member of that council would agree with the Taoiseach's analysis of the economic position. What the Taoiseach told us is unreal; it does not represent the hard facts of life. I checked with the banking sector and I was told that the biggest provision for bad debts they were making was in a section they labelled stress borrowing for personal borrowers. If any person gets any extra money into his pocket after the tax man is through, his first priority will be to pay his bank loan.

We hear a lot of talk about prices coming down. Talk to the housewives and they will tell you if prices are coming down. We import coffee, but ask the housewives what happened to the price of coffee over the past few weeks. When are all these major price reductions being introduced? I do not believe any major price reductions will be introduced because this Government do not realise the size of this market. They do not realise that competitive forces will not reduce prices in Ireland because the buying power is concentrated in a very small number of people.

Last January the Government made the wrong decision as regards the National Prices Commission. We cannot force the price reductions which should follow from weakening sterling or an appreciating Irish pound. Irish businessmen are suffering very badly as a result of the wrong decision taken on realignment. For the second time, the Government got it wrong. They devalued three years ago when they should not have done so, but they did not do it this year although they let the French con them so that they got realignment, thus giving them the competitive edge in the British and German markets. All the things we were told would happen as a result of realignment simply have not happened.

Where are the lowering interest rates we were told about? Interest rates in Ireland today are still higher than they were last December. Admittedly, they are getting lower but everybody forgets how high they went before realignment. The real interest rate is not the 10 per cent some people talk about. Ask the people who borrow. They will tell you that interest rates range from 12½ per cent to 17 per cent. The inflation rate is 4.4 per cent at present which is disappointing, despite the Government's projections that it would be down to 2 per cent or 2½ per cent at this time. The real borrowing rates for the business and productive sectors ranges from 8 per cent to 12 per cent. There is no way the business and commercial sector can compete under those conditions. To make a profit Irish businessmen must make a return of 20 per cent and few businesses in this country can claim to reach even half that target. The reality of the decision about the exchange rate is that Irish industry had export prices to the United Kingdom reduced by almost 10 per cent within two or three months. How could our businessmen be expected to take such a sharp drop?

Our Minister said we were a very strong economy and that we would not go along the road the French took. He said we were staying put. That was very bad advice and was of no benefit to anybody in the commercial sector who has to depend on exports. Interest rates have not come tumbling down. Inflation is 4.4 per cent. It is ½ per cent in Germany; it is half the Irish rate in the United States. Kingdom, the country to which we export 40 per cent of our products. It is lower in France and it is 1.6 in the United States. We are a major exporting country but that is the burden our exporters have to carry and the sooner the Government realise this the better.

More and more industries are closing because the Irish pound is overvalued at 90p, and if Britain ever decided to join the EMS we will be on a very sticky wicket. The two currencies in which we conduct most of our trade, the US dollar and sterling, have gone down significantly over the last few months — the dollar by more than 30 per cent and sterling by about 10 per cent vis-á-vis the Irish pound. How can we hope to trade profitably when the two major currencies in which we trade have moved so very significantly in the wrong direction as far as we are concerned? We know there are risks in the marketplace, but that size of shift is not even recognised in Government circles. They took the very narrow view of deciding to save money on the debt service. In the half year we saved £50 million. They must look at this in a wider context and see what price we will be paying on the other side if we continue along that crazy road of thinking we are a strong economy and living in an unreal world.

Indigenous Irish industry is not alone coming under fierce competition on the home market because of the weakness of sterling or the strength of the IR£, whichever way one wants to look at it, at the same time having to accept a 10 per cent reduction on the UK market and to face a 6 per cent competitive advantage since realignment with the French. The realignment that was supposed to bring benefits in the German market disappeared within 48 hours. If we continue along that line the first sector to crumble probably will be the Irish confectionery industry which uses native Irish raw materials, which has no input from the sterling area and has no write-off against sterling. What sort of loss will that be?

I will not name any company, but two companies come to mind who employ over 1,200 people and use 30 million gallons of Irish milk and the entire production of Mallow sugar factory. Those companies will crumble if this exchange rate is maintained by this Government and the £50 million will not be long disappearing in unemployment benefits to the people they will throw out of work. Our milk quotas in the EC are being squeezed and the Irish agricultural sector will miss the outlet for 50 million gallons. Because they are market leaders here, the confectionery industries I talk about can produce over there and send the products here and lose none of their market. We are on the road to devastating our indigenous industries if we do not recognise reality.

For far too long we have over-aligned on international investment in multinational corporations coming in to do the job for us. We will end up as a big warehouse with a computer in it if we do not get away from this narrow minded, tunnel vision view of the economy. We are not the same as other economies, and coming in here to quote favourable statistics which would reflect the strength of a developed economy is the direct opposite to what we should do.

We have balance of trade surpluses. Why? Because in the first four months of this year our imports went down drastically and in the production cycle in Ireland 50 per cent or 60 per cent of those imports are into reprocessing here and in four months' time we will see the result of that. We saw the tip of the iceberg in the May unemployment figures where the underlying trend was 3,200 the wrong way. That shocked the Government, me and everybody else because we had to look to see what was happening. The lower imports go with 60 per cent of them for reprocessing, will inevitably reflect itself in the second half of the year. Therefore, we are not looking as good as some people might like us to believe. This Government must take a wider economic view and recognise that their economic policies have led us into this and that mistakes have been made. We all make mistakes but if you make ten decisions and eight of them are right, the eight good ones will outshine the others.

We must take a serious look at the wealth created here and not put the same old reliance on multinational investment. What is happening in that area? In the past five years since 1980 the number of jobs in manufacturing in multinationals in this country has been dropping and dropping. Consider the outflow of funds through the black hole in this economy. In 1985 the outflow was £1.3 billion, and the best estimate for 1986 is £1.5 billion. In simple terms this country has become poorer by £2.8 billion in two years by the outflow of funds by multinational investment. Is shows that they made money here but how real those profits were nobody will ever know because of the transfer pricing involved.

This sort of wealth creation is flowing out and not flowing back into the economy. That is why we are not uplifting our job numbers and our wealth and why our tax burden is so high. We are not getting the results from investment that we had hoped for. We must look at our industrial policy in the long term, but we must also look at what we have and develop it. We must look at the areas here that are our own. Any businessman will ask himself what his unused assets are and how he can put them to use. Everybody knows what the assets are. Everybody is agreed on what has to be done, but this Government, while recognising many of the things that have to be done, have not yet done anything in their three and a half years in office.

Building on Reality 1985-87 provided that the grant to CTT for improving marketing skills and marketing distribution should be doubled by 1987. That will not be met. If it is £24 million today, it will have to be £35 million next year and we see by Exchequer returns that there will not be much money to throw around. It is just another broken promise, another recognition at the time of what has to be done, but traced to action it does not happen. It is one of the greatest weaknesses of Irish industry at the moment, and there is no point in the IDA preaching to small and medium sized industries that they must become internationally traded when, in the first instance, they cannot afford the expense of marketing single handed. Neither can they afford distribution in international markets. We need group marketing and group distribution in that area, but at the moment small industries will not be listened to because they are not part of the international trading environment.

The Taoiseach and Ministers must stop misleading the people and the House with guesstimates about the money found for ICI, Irish Shipping and every other debacle. Let them at least put the economic facts of life before the people who have found them out so often in the past. Otherwise they will find them out again. The worst thing than can happen to a Government is that the people stop believing in them, and this Government have this problem at the moment. No other leader in a western democracy would stick his neck out so far as the Taoiseach did in making a personal appeal to the women of Ireland to believe him and do what he wanted them to do. He got a flat rejection to his face. If he had the interest of the country at heart he would respond to the call of the ICTU in Belfast to put his record to the test. He will not put it to the test because this man and that Government rely on opinion polls and do their governing by them.

That is why they got things so wrong in the referendum. They jumped on a bandwagon, though not because they had the courage to run. Not long before that the same Taoiseach said he was not going to have a referendum in the life of this Dáil. However, when the Labour Party said this was the bottom line for staying in Government and when for a brief time the opinion polls indicated a majority for it, he up and ran. Let him not teil us that it was great, courageous visionary leadership that drove him to that decision. Politics is a different game.

If this Government have the interest of this country at heart, they should take decisions which will put this economy back on the right road. It is too late for that anyway because they will not enjoy the confidence of the people or the investors. They cannot put things right having failed so dismally for three-and-a-half years. The record is there to show they did not reduce tax, they increased it. They did not reduce unemployment, they increased it. They ignored the ravages of emigration and continued to bury their heads in the sand. The game is up for this Government. The bubble has burst. The goose is cooked and, while the turkeys did not vote for Christmas, the Taoiseach remains in wonderland and Alice has moved to Shatterland.

I will issue one warning to the Taoiseach, to come out of wonderland and stop burrying his head ostrich-like in the sands of time. The passing weeks and months are making this economy worse. If he wants to take a courageous decision, if he wants a place in the history books, let him admit that he was not prepared to take the decisions, that the other party in Government or maybe some of his own party would not agree with him. That is the only way true leadership will be shown. Where now is the slogan of the Fine Gael Party: "We always put the country first"? They are afraid to come to the polls. They look up at the poles and see on them the picture of Deputy Garret FitzGerald and the slogan, "Win with Garret". They do not want to face the reality of losing with Garret. We have never seen a consistent opinion from the opinion polls in which they always believe. We always like to rely on the real opinion polls of the type in which votes were cast last week. The Government have been devastated in by-elections, local and European elections and last week in the referendum. The ordinary people cannot be fooled any longer——

An Leas-Cheann Comhairle

Your time is up, Deputy.

Mr. Reynolds

Over the past few years the Government spent their time debating the abortion issue; then they turned their attention to family planning and divorce. They have failed in their programme of social reform and economic management. Pack up and go and give the country a chance to lift itself from the despair and disillusionment which are rampant among our people.

The whole boisterous and swashbuckling attitude of the Opposition over the last couple of days indicates total and absolute insincerity. Deputy Burke was quoted in the Irish Independent this morning as saying the Government were now living on borrowed time and that the Adjournment Debate was a parliamentary wake for the Coalition. He says the Government are living on borrowed time——

Mr. Reynolds

And borrowed money.

Mr. Durkan

This Government have lasted somewhat longer than the landscaping and tree planting exercise carried out in Dublin west constituency during a certain by-election a couple of years ago. We must tell the public exactly what we believe in and the fact is we are faced with tough times regardless of who is in or out of office.

Mr. Reynolds

So, we are not looking good.

Mr. Durkan

Deputy Burke also claimed——

Mr. Reynolds

This man is contradicting the Taoiseach.

An Leas-Cheann Comhairle

Would the Deputy control himself?

Mr. Durkan

——that the Government were trying to undermine the decision taken by his Fianna Fáil predecessor to abolish domestic rates implying that the Government should be prepared to reintroduce domestic rates. But we all know the attitude of Fianna Fáil councillors throughout the country to that issue. In our county of Kildare when the Opposition got an opportunity to abolish local charges and had a majority on the council, they all walked out before a decision could be taken because they knew if they remained there would not be a council afterwards and they could not risk that. I have to say that I take a lot of the sanctimonious diatribes I have heard over the past few days with a grain of salt.

Listening to the Opposition one would think the Government had done nothing in the past few years. There have been considerable achievements in the housing area. Any young couple seeking to be rehoused or to buy or build a house now has ample opportunity to do so in urban or rural areas. That was not the case some years ago. This dramatic change has been brought about by Government support grants and deliberate changes in Government policy, including the introduction of the £5,000 house surrender grant, the increase in the new house grants and the increased SDA loans scheme whereby more loans have been made available and are easier to obtain. The result is that far more people house themselves, relieving the State of the responsibility of looking after them. There is the added advantage of encouraging people to become selfsufficient and independent of the State. That is positive and this Government will be remembered for it.

Unemployment has been with us for a long time and will be for some time to come. Numerous schemes have been introduced by the Government, some of which have not achieved their full impact yet. If it were not for those schemes unemployment would be far worse. The Opposition have denounced these schemes and have said that people involved in them would be as well off unemployed. I reject that absolutely. It is far better for people to be employed even on a temporary basis, thereby getting some experience and having pride in themselves and in their ability to do a job, rather than being condemned to the unemployment register where there is nothing but despair. The Government also introduced the social employment scheme, the family income supplement scheme and other schemes. They have all had a greater impact than one would at first realise. If we did not have the schemes we would have a far greater problem to deal with and the Opposition might have good reason to raise their hackles and the hackles of those around them by condemning them. But those schemes are in existence and something is being done about the problems.

I mentioned the public perception of Government. One should also mention the public perception of the Opposition when one examines the situation which will unfold over the next 18 months. The Opposition are opposed to unemployment, to high taxation, to local charges, to rates, to moderation in pay agreements, to high VAT, to motor taxation and excise duties, and to poverty. They are opposed to all the things that everybody is opposed to. But they have not put forward any solid proposals to solve those problems other than by running away from them. Whenever a difficult decision needs to be made they have contributed by running away in the hope that, if they make enough noise in their retreat, the people will say they said the right thing even if they did not do the right thing.

That leads me to the Anglo-Irish Agreement. It is disgraceful that the Anglo-Irish Agreement should be used for party political reasons, particularly in this House. There are those who say that the Anglo-Irish Agreement has not achieved the great results that were anticipated in the beginning. The Taoiseach and the Ministers responsible were at all times at pains to point out that they did not expect a magic result overnight. But it was a beginning and everything must start somewhere. At least it was better than what has gone on for the past 15 or 20 years. To those who say it has caused suffering and death since it was introduced, let me say that there has been a great deal of intolerance, destruction and death over the past 15 to 20 years and remarkably little condemnation of it when one considers the amount of obvious aggravation the Anglo-Irish Agreement has caused to some people in the Opposition.

It is deplorable that we should play politics with a sensitive issue such as the Anglo-Irish Agreement which is, as has already been stated by people on this side of the House, only a first tentative step down a very difficult road. It needs all the support that it can get from all parties and all interests, both inside and outside this House. If one will pardon the paraphrase, there are those who see things as they are and ask why, and there are those who see things as they might be and ask why not. The Taoiseach and the Government had every right to ask why not in the case of the Anglo-Irish Agreement and try to put forward a new set of proposals which it is hoped with the passage of time will attract moderate people who will ensure the demise of the deplorable debacle of the last 15 to 20 years. The less of a political nature said about that in this part of the country in the future, the better.

When we talk about perception of opposition, I must also refer to the attitude of the main Opposition party in relation to the recent referendum. No doubt when this referendum was first mooted by the Government there was a long discussion at a party meeting before a decision was made as to what was to be done. I am sure that there was a great deal of soul searching before a clinical, political decision was arrived at that the best they could do was to say nothing. The best they could do was to sit on their hands and pretend to allow those who had diverse views within the party to express themselves — but not too loudly, lest they might rock the boat. At the same time they pretended that most of the party were about to allow the people to make up their own minds. I am afraid that experience in the various constituencies would seem to indicate otherwise. We saw members of the main Opposition party vigorously campaigning, but under a different banner — not campaigning under the party political banner — in a cynical and clinical political exercise which sought to do nothing other than defeat the proposal in the referendum.

We heard in this House the strident voices raised by the various spokesmen for the Opposition who protested with hurt pride and dignity whenever it was suggested that some of what they were saying in the course of that debate was in some way insincere. In the House again and again they loudly inquired, worried and protested lest somebody would get the wrong impression. They pretended that at all times they were sincere. I, for one, was not taken in by their attitude. I was disappointed by it and by the manner in which they welched on the public in that issue. I always accept what the people say and will accept it in the future, but we who are elected to public office have a duty to try to explain to the public all aspects of legislation put before them and, in particular, we have a very obvious duty in relation to putting forward the case in a referendum. We have a duty to explain, regardless of what our political attitude is or should be, the pros and cons of the subject and ask them to make up their minds on the basis of the accurate information given to them. I never saw so much fudging of an issue coming from the opposite side, or an organisation so willing to sit on their hands — a major political organisation — for so long and to say so little publicly. Mind you, they were very quick to jump on the band wagon once the people had decided and it was safe to do so, having gone through the performance of remaining silent for so long, at least to outward appearances.

A considerable number of people voted in favour of the amendment in the referendum and they will remember that the Opposition took a particular line. Those who spend a lot of time analysing figures would do well to analyse those figures a couple of times. After all, people do change their minds. Deputy Reynolds mentioned a couple of other items——

Mr. Reynolds

I must listen to this.

Mr. Durkan

——for instance, ICI and PMPA and Dublin Gas. I am not surprised that he mentioned them, but he mentioned them not from a business point of view but purely for political purposes, nothing more than that.

Mr. Reynolds

Nonsense. Let the Deputy answer the figures if he wants to.

Mr. Durkan

He did as all his colleagues have done for the last three years and will do in the future. What he has not said is what they would have done under similar circumstances. No doubt they would have done as they did over the last few months in relation to the issue which I have just been discussing — they would have said nothing. They would have a couple of meetings, a crisis or two; perhaps one or two Ministers would have been sacked, or would have resigned. There might have been a threat to the leadership. Many things could have happened. Perhaps in the case of the PMPA they would have let the whole insurance industry go into the ground.

In relation to inflation and interest rates, I am surprised that the Opposition have not in some way claimed responsibility for the reduction in both. They have not so far, but given the latitude and poetic licence that they usually take, I have no doubt that they will claim responsibility for that in the future. Opposition speakers always compare our inflation rates with those in Germany. They do not pick out similar economies to ours, but always the most vibrant, the most sophisticated economies for comparison. They fail to compare the interest rates and inflation rates here in 1979 and 1980 with the corresponding rates then in those economies. That would be a simple exercise which would help the public to come to a realistic and fair-minded decision when they wish to evaluate performance. They have long since forgotten that inflation rates here were in their twenties not so many years ago when Fianna Fáil had responsibility for holding the reins of Government, and interest rates were not too far behind. Any business man or farmer borrowing money then over a period of four years and running into financial difficulties had his debts doubled if he was not able to make his repayment. That is the sad, stark reality. Business and industry would well remember that when they evaluate the pompous pronouncements which have emanated from the Opposition over the last 24 hours.

Mr. O'Kennedy

So that there will be some time available for Members of The Workers' Party to speak, I am agreeable that some of my time be allotted to them. For that reason, I shall finish before the normal period of a half hour. Everybody wants to contribute to this debate and not just to confirm the reality of the depression and unrelieved gloom out there. It is important for us all, and particularly for the Government of the day, not to misrepresent that reality even in the interests of their standing and integrity. If the Government misrepresent that reality before the young, the old, the unemployed, business people, farmers and those who are emigrating, they face the inevitable consequence of a total rejection of them, and, perhaps, of the political process. A Government and a Taoiseach who misrepresent the realities so constantly are not doing themselves or the country any service.

When we read headlines in today's newspapers, based on the Taoiseach's speech yesterday, to the effect that we are looking good, we realise that we are reaching a dangerous point. Those who read those headlines will be infuriated by the fact that the leader of the nation is attempting to convey an impression which is at odds with reality. Irrespective of who is in Government — we all wish to claim virtue for ourselves and point to the lack of any virtue in the other parties — we must be careful not to infuriate our people by making false and spurious claims.

I have known the Taoiseach in political life since both of us entered politics through the Seanad in 1965 and, subsequently, the Dáil in 1969. I have respected him for his good intentions, his general attitude and for what is being presented as a unique feature, his integrity, up to a point. However, when those intentions fail, when the Taoiseach does not have the capacity, the judgment, the direction or purpose to implement those intentions, as he has demonstrated, then not only does he do a disservice to himself but the memory of whatever he has contributed over the years, particularly in Foreign Affairs, will be overwhelmed by the total repudiation by the public of a leader who insists on presenting a picture that is sodistorted as to antagonise every section of the community.

I will not repeat what has been outlined in great detail by our Leader this morning. I will not repeat the reality of the economic position, the deficit or the targets that have been forgotten about. I will not deal with the borrowing, although it was acknowledged officially by the Minister for Finance that the total national debt has increased from £12 billion to £21.1 billion in the Government's term of office. Those facts speak for themselves. We are all aware of the impact of taxation on our people and of the unemployment and emigration trends. The Taoiseach tried to distort those facts yesterday when he said that the unemployment trend had improved dramatically over the past three years. If the Taoiseach had used the word "increased" we could begin to accept that at least he was recognising reality. However, the leader of the nation, at a time when unemployment is continuing to grow despite the increase in emigration at a frightening rate, made a statement to the effect that employment had improved dramatically in the last three years. It is time the Taoiseach recognised that he is not entitled to distort the realities or address our people in such a manner as to infuriate them with such spurious claims. That is a measure of the Taoiseach's lack of capacity and something I regret.

I have listened to leaders of Government and Opposition over the years and, as we said in Government on many occasions, heard it said that it was easy for the Opposition to concentrate on attack but that the Government must stand by a programme or policy and point direction. The function of a Government is to point direction, to give the priorities, to show how they are meeting those priorities and to indicate to every sector how they are going to realise the potential of the nation. In my 21 years in the Oireachtas, which coincides with the term of the Taoiseach, I never heard a Taoiseach in a debate at the end of a Dáil session devoting so much time to attacking what he claims to be the policies of the Opposition. He did not utter one word about the general priorities of his Government at this crucial time for the nation. I searched the Taoiseach's speech to try to find out what he was telling the Irish people now, to see if he was giving an indication of where he is leading us, but I could not find one word. That is one of the clearest indications of the lack of capacity of the Taoiseach, and the Government. We have not heard one word about how we can avoid the problems that are facing us and begin to realise the enormous potential of the nation. It is time that Members on both sides of the House started to focus on that potential and give clear indications of our plans to realise them. In the final analysis it does not matter which party is in Government; what matters is the plan the Government has to create the conditions under which people outside will have an opportunity to realise their full potential. It is my intention to spend some time dealing with the potential for the country and how we propose, through a range of comprehensive co-ordinated policies, to realise it.

In the last 12 months Fianna Fáil have had many discussions with delegations from every sector in our society. It is a measure of the confidence of those sectors in Fianna Fáil that they sought to meet us and a measure of their decision to repudiate the Government. I should like to make a point in advance of the unemployment figures to be officially published at 3 p.m. today. We have been conducting on a three-monthly basis an analysis of unemployment trends from information made available to us by the agricultural, services, manufacturing and financial sectors. I can predict that the figures to be announced in less than one hour — I do not have any inside information and the Government will have to take me on trust in regard to that; I respect the procedures adopted by the Central Statistics Office — will show a continuing upward trend, at a considerable pace, in the unemployment figures, unless all the indications we have been getting from the various sectors are wrong. Yet the Taoiseach told us that there has been a major improvement in employment trends over the last number of years.

As a consequence of the discussions we have had in the last 12 months I should like to consider where our strengths are and where the Government should be concentrating their priorities for resource development and employment in an effort to create a new spirit of confidence in a great nation which is now on its knees. We are to a considerable extent an agricultural economy and all the farm organisations, Macra na Feirme, Muintir na Tíre, IFA and ICMSA, whom we have met, recognise what we knew: that the Government have abandoned any comprehensive plan for the development of agriculture. They are reacting to events outside.

There is no direction for the development of agriculture and for added value through employment in the agri-food industry. Even bodies such as the Agricultural Credit Corporation that were established to promote agricultural development, from any of the evidence we have in our own areas, no longer have a development direction from Government. It is quite the opposite. What is now being presented to corporations as vital as that is that development of agriculture has been written off by the Minister, the Department of Finance and the Government. From now on they are to behave purely and simply as another financial institution, with one criterion: to keep those books right. That is the kind of position we have reached. We can see in our constituencies the most productive people who have invested money, with high interest rates, being driven out of agriculture. Some supporters of the Government have come to me, farmers in my constituency whom I respect but have never had the privilege of their votes, asking what I can do to get them and their families to New Zealand, Australia and America.

Are we closing our minds to the reality of what is happening in regard to agriculture? Our priorities will be that the farmer will produce for the market that is established. We, in the course of our discussions and policy formulations, will develop a marketing strategy for the agri-food industry, because it is clearly totally and utterly inadequate at the moment. Our market penetration in Europe is at the same level as in Malta. If we search through the supermarkets in Europe and look for Irish food we will not find it. Are we going to sit back and moan or cry, or are we going to recognise that we have personnel whom we will equip to go out to those markets, who will be familiar with them, who will speak their language, who will know their habits and who will feed back to us in a direct attack on these markets? They will have a great potential for new promotion, employment and prosperity throughout the agri-food industry, the food processing industry, instead of having a closed market in all areas. If we look to the area of bacon, meat, Erin Foods or whatever — my constituency is very representative of this, as you, a Leas-Cheann Comhairle, will appreciate — we get threats, rejections and total desperation everywhere we turn. Is that the way it should be in an agricultural economy? We will guarantee to change that. Our plans are ready for marketing, food technology and investment in product development. We have a much more confident and aggressive approach in the European Community context.

I have experience in Europe. All treaties including the Treaty of Accession, our Protocol and all the directions of the European Community were based on the fact that the policies and the treaties of that Community were going to be towards maximising employment, particularly in the less developed economies, and to give them the breathing space to realise their potential. This Government, as our leader said this morning, have been supine. Has anyone checked as to how the quota restrictions are being implemented in the Federal Republic of Germany, in the Netherlands or in Belgium? If they do they will find that what is being imposed here by a decision of this Government is much more stringent on our agricultural economy that what is being imposed in those economies. They find ways and means of interpreting the regulations of the European Community, and particularly of the Commission, to avoid the worst impact on their agricultural sector. It is time that we exercised our imagination and our strength and that our voice is heard in a way that it has not been heard before. There is no point in trying to win international acclaim by always talking at great length in analysis, by speaking to conferences, by attending commissions such as I have attended and by always having something to say in an objective and apparently informed way, if at the end of the day the Taoiseach has not the guts, the confidence and the courage to stand up and fight as others have done for their countries.

If the Taoiseach and the Government are not aware of the state of manufacturing industry — the figures are there to prove it from mid-March — would he at least talk as we have been talking to the representative groups in industry. He will find that the domestic indigenous industry is on its knees, that the productive capacity of our domestic sector is at an all time low relative to the whole economy. If he checks with any of the representative groups in industry he will find that, if this consumer boost he is waiting for in the next few months is to come — and, God knows, there is no evidence of it — it will not be because of any growth of output in manufacturing industry or in native domestic industry; it will be because the imported products may be consumed at a greater rate than at present. Our manufacturing industry would not even be able to produce for a market if it were expanded. Interest rates, energy costs and infrastructural costs are crippling them. If we are to get the boost the Taoiseach is talking about it will not be reflected in enhanced employment of productivity in the manufacturing domestic sector. I do not believe that we will get the boost in any event. No informal talk with any of these representatives would bring that about.

We would do things differently, as I have argued before. Incentives for marketing personnel who spend a lot of time abroad would cost a minuscule proportion of our total expenditure, about £2 million or £3 million. We made proposals to the Government each year but were never listened to. Let us give them the incentive and let us see the impact back home on the new markets that will open up. The Government have not the wit, the imagination or the capacity to do that. We will do it.

The growth in the area of the service sector and financial services is enormous. It is a labour intensive area at a very sophisticated level. We have immense opportunity and advantages here. We are in the same time zone as London. We could develop in Ireland, which we will do in Government, a financial services centre which will ensure that, instead of seeing all our graduates going abroad from the financial houses because they are excellent quality, we will have them at home developing the potential that is there whether in the insurance sector, the financial houses or the banking sector. The Government have not the wit to begin to attack the whole review of the banking sector which was commenced in my time in the Department of Finance and a review of the whole basis of legislation in the banking sector. The potential there is enormous. What happens there is affecting the agricultural industry as well as every other sector.

The Government have soaked up the funds that are available, and they are very limited, into Government gilts. This has brought about undue pressure on the available money market. It is the cause of the distorted interest rates which are now running at a real interest rate of 10 per cent. Pension funds are even investing in gilts. Potential investors who would invest in employment and in real development are now switching to the safe gilts. There is nothing coming out of the gilts because none of that money is being put to positive direction in investment. It means that our interest rates are spiralling at an enormous rate. When all around us interest rates are coming down, they are going up here. Who will invest in that condition in Ireland? The Government's response to this is something like the nonsense of a National Development Corporation. If that is a response to our problems or a direction for our potential, I do not know to what depths the Government have condemned themselves, on top of their inertia and paralysis.

During the past 12 months as spokesman on Finance I have spoken to interest groups from Hong Kong, to US marketing corporations, to groups from Australia, to construction industry groups from around the world, who are anxious and ready to invest here. They see the potential here. I have their records, their plans and they are ready. But they will not invest now.

I wonder why they are talking to the Opposition. Is it because they have no hope or trust in the Government? I do not know if the Government even knew they were here. The vice-president of one of the biggest international banks, with whom I was speaking in the last three months said: "What can we do for you"? My answer was: "Do what you would do for yourselves. When you see the climate right here you will invest, you will participate. That is all we ask you to do". That is what they will do when we give the signal of an investment climate which is now so totally undermined.

I have looked at the Taoiseach's speech. At a time when we should be getting direction and leadership, what do we get? We get a rerun of the referendum debate. There is work to be done in that area for families under pressure, families who, because of economic circumstances, need to be supported — our tax system is killing them. The Taoiseach went back to an analysis of the past 25 years. I say to him personally: "Would you learn? You are here to lead the nation. Would you do so and not be concentrating on a review of what is over?".

We have imposed tax burdens on people who could care for their old folk at home if we gave measured tax allowances for the care of the old in their homes, where they want to be. I have figures of something of the order of £5 million to cover the Fianna Fáil proposals in this regard. We could keep our old people happy and secure in their own homes and we would be benefiting society, too, because we are turfing them into institutions where care and attention cost so much. That is an essential element of our policy. We have seen hospitals closed at great cost. The Minister even says he is not doing it. Would the Government knock their heads together and realise that there is a better way?

In the two minutes I have left I will deal with a couple of other points, though I would have liked to have referred to education, technology and other things at the centre of our plans instead of wasting money on short term schemes. The Government are wasting considerable funds. Would they instead invest in knowledge for added value for the future, as the Japanese have done. In our time in Government we demonstrated that our young people are not interested in a day here and day there at work. They are interested in the contribution they can make for themselves and the country.

The tax reductions we have put forward, with the standard rate for two thirds of our people, are not anything near what the Progressive Democrats are proposing in terms of cost but they would mean that the present high tax levels which are driving away the best in the country and preventing the best from coming back must be adjusted. We have real strength which could be harnessed if we got a national consensus from all our people in agriculture and industry. Fianna Fáil will present a basis for national consensus and guarantee a direction and thrust and a commitment from us in Government. God knows that is not there now. The next time a Taoiseach addresses this House in an Adjournment Debate it will be a different Taoiseach and we will hear something to give us hope and confidence.

Tomás Mac Giolla

I am allowed to speak for only ten minutes and I intend to do that, though it is unfortunate that I have not been given more time. Therefore, I will be unable to deal with some of the important issues that I wanted to speak on in a review of the past year, including Northern Ireland, neutrality, nuclear armaments, power stations, etc. I had hoped to deal with the erosion of democracy in Government and local government.

I will deal specifically with the view on morality in this society and this House which has been particularly evident in the past few years. In the past few weeks we heard much about morals, morality, the Christian ethos of our society, and we have been lectured by the Catholic Hierarchy in particular about what is and is not acceptable in marriage, human relationships, etc. When did we last hear a bishop attacking the morality of those who have deprived 250,000 people of their jobs which has led to such extraordinary poverty in our society?

Where is the morality in a society in which one person can pay up to £40,000 for a motor car but another person has difficulty in finding enough food to put on the table for the family? Where is the Christian ethic in building new modern hospitals in Dublin in which some people may pay up to £1,000 a week for treatment in exclusive private clinics complete with à la carte menus, wine lists and what have you, while the poorer sections of our society have fewer and fewer health services and longer and longer queues waiting for essential treatment?

Last year I quoted Dean Victor Griffin on this issue and I should like to do so again, particularly for the benefit of Deputy Haughey who is an admirer of the dean. What he said is the basis of what I am talking about. He said last year:

Irish society has concentrated too much on sexual morality and too little on economic morality. Honesty, integrity and justice in all our dealings should be more important today than any questions of sexual morality.

That is precisely the point I want to make. Since I came into the House in 1982 I have heard much talk about morality and about freedom of conscience for Deputies, free votes on certain issues. Significantly, these have always been about sexual morality or personal rights, issues of divorce, family planning, etc. Then and only then do Deputies have consciences.

Why should matters relating to sex be the subject of a TD's conscience but not the economic matters with which Deputies have to or should deal more than 80 per cent of their time? Why should there be a free vote on family planning but not on the miserable pittances we give to our old age pensioners or unmarried mothers or the long term unemployed who are sinking deeper and deeper into poverty? Apparently, Deputies do not have consciences on that.

Our Constitution has beautiful flowery phrases about the family such as "the natural primary and fundamental unit group of society". It goes on to tell us that it is a moral institution possessing inalienable and imprescriptible rights antecedent and superior to all positive law. That is a beautiful phrase and I am sure de Valera was very proud of it. I am sure successive Governments show this to the world and say: "Look at what we think of the family. We give them inalienable and imprescriptible rights antecedent and superior to all positive law." What does that mean? Can any family tell us what their inalineable and imprescriptible rights are? Nobody has ever told them they have none. Families with property probably have many inalienable and imprescriptible rights. The vast majority of our families do not have property. They are not thought of.

The harsh reality of family life in the mid-eighties is about as far removed from that idealistic vision as it is possible to get. We have heard much from the Hierarchy, various Deputies, public representatives and many others about the threat posed to the family by divorce. Little is said about the threat to the family from the economic policies pursued by the Government and previous Governments. That worries me because, when we condemn the Government and their policies and wish to see them out of office, as I do, we worry more and more at what will come after them. I have no cause to be anything less than very worried about the possibility of Fianna Fáil taking over. I know what they have done over many years. There will be absolutely no difference between their hair shirt and the Government's hair shirt. In the working class areas of my constituency the real threat to the family comes from the crushing burden of trying to survive and making ends meet.

Unemployment is still increasing and the figures will show that a further 2,000 have been added to the unemployed. That is the main burden on families. A man in his mid-forties has no prospect of ever again having a job. A young teenage family also have no prospects of getting jobs. Generally speaking, the crushing burden of poverty, the task of keeping the family together and the near impossible task of making ends meet on totally inadequate social welfare payments, fall on the unfortunate mother. We have enshrined in various areas the phrase "freedom from want". The war on want is always in reference to the Third World, never in reference to this country or about anybody having the right to freedom from want.

They do not have such a right. Nor do they have a basic right to work. There is no war on want in this society. There will be no war on want when Fianna Fáil take over from the Government either. That worries me. Only a tiny percentage of children from working class families ever make it to third level education. In the Dublin 10 area which is the heart of my constituency, only 1 per cent of young people get to third level education, whereas in the south County Dublin area up to 44 per cent avail of third level education. That is the type of society we live in.

We have seen in recent weeks that when people from families who have similar backgrounds to the men on the Bench come before the courts they receive totally different treatment from that received by working class families who come before the courts. A totally different attitude is adopted to them. This is the reality of family life after 65 years of self rule. Let us put aside the cant and hypocrisy about our special attachment to the family until we are prepared to treat all families equally, to ensure they have an acceptable standard of living and that the children of all families have equal opportunity. The greatest failure of the Government has been their failure to tackle unemployment. They do not have a policy in regard to job creation. The Taoiseach said it was not the function of the Government to create jobs. The Workers' Party are anxious to change the attitudes of Governments to employment, poverty and want in our society. We do not see this coming from Fianna Fáil who are the only replacement for the Government.

Mr. Enright

I would like to dwell on some facets and aspects of the Anglo-Irish Agreement. In doing so I want to bring to the attention of the House, the Minister for Foreign Affairs, his counterpart in Britain the Home Secretary, the Irish and British Governments the continuous serious problem of supergrass trials. On 18 December last a decision was announced in the High Court in Belfast, given by the Honourable Mr. Justice Carsdale, which led to 27 people being convicted that day in Belfast. They were convicted on that occasion on the word of a supergrass, Harry Kirkpatrick. I have been concerned about that decision ever since. The evidence of Harry Kirkpatrick which led to the convictions was uncorroborated. I have practised law for a long number of years and for uncorroborated evidence to be accepted is unusual. To know beyond reasonable doubt and give a verdict of guilty, a judge in the Irish courts and normally in British courts would like to have heard evidence supported by some other person. It is unusual for a judge to give a decision of guilty on uncorroborated evidence.

However, I must bring it a stage further. The evidence given by Harry Kirkpatrick was clearly evidence which must have raised the gravest doubts in the mind of any judge. The evidence which came out in court to any layman or fairminded person was of a highly doubtful nature. In the view of many people, there was perjury. Through the Anglo-Irish Agreement we have a forum where we can express our objections to and our abhorrence at decisions of this nature. Today, I must call again for an end to supergrass trials. Harry Kirkpatrick gave evidence that one of the accused was engaged in criminal conspiracy. Harry Kirkpatrick went further and identified the defendant in court as being a conspirator. Later in the trial it was clearly proved by independent and uncontroverted evidence that this man was actually in prison at the time when Kirkpatrick claimed he was engaged in a criminal conspiracy. That is a matter of record. What alarms me is that the judge treated it as a mere mistake. It worries me that a totally innocent person could find himself in prison for the rest of his life on uncorroborated evidence of the most doubtful nature or perjury.

If a person gives evidence for financial reward or some other kind of benefit, that evidence must be suspect. I am totally opposed to the giving of evidence for reward and to what is happening in the supergrass trials in the North. Through the Anglo-Irish Agreement we must express our disquiet and objection to these decisions.

The Ceann Comhairle may wonder why I am dwelling at such length on this case. The reason is that this morning in the court of appeal in Belfast two more Irish people were convicted — John McConkey and James Gibney, aged 31 and 30 respectively. They were convicted today before three judges and I am alarmed by that decision.

Today's edition of The Irish Press contains an article relating to supergrass trials and quotes the comments by the North's Lord Chief Justice, Lord Lowry, on the evidence of Kevin McGrady. The article states:

"To have convicted on any of the counts in these groups of charges would have been a perversion of justice according to law, so contradictory, bizarre and in some respects incredible was McGrady's evidence and so devious and deliberately evasive was his manner giving it," commented the North's Lord Chief Justice, Lord Lowry, dismissing murder charges against some of the ten men accused of IRA offences by supergrass Kevin McGrady in October 1983.

But Lord Lowry went on the convict seven of the ten of a series of offences on McGrady's word.

We have an obligation to bring this matter to public attention in every possible forum. In the first instance this should be done through the Anglo-Irish Agreement. The British and American ambassadors should be made aware that we are strongly opposed to this system. Recently President Reagan and the American Government generously allocated the sum of £50 million to build up structures in Northern Ireland. The American Ambassador should bring to the attention of her government our concern that money is going to Northern Ireland where this system of supergrass trials is permitted to continue. We live in a democracy, as do the British and the Americans, but supergrass trials based on uncorroborated evidence are a blot on any judicial system. The American Ambassador should view the decisions today in a very serious light.

The Anglo-Irish Agreement represents a wonderful opportunity to bring people together in unity. Some people have doubts about its future; but, where men of goodwill come together, only good can come of it. I believe good will come from the Anglo-Irish Agreement. The conference set up by the agreement is the only forum where people from North and South can get together to work for the betterment of their country. There are difficulties at present but I am confident that people from North and South can work in unity and harmony if there is sufficient determination and effort by people on both sides of the Border. Nothing positive can be achieved without such efforts by people of goodwill. There is an obligation on every Member of this House and on those outside to work together to ensure that this agreement brings about unity so that people can live in peace and harmony. We have seen too many people killed and mutilated to sit back and do nothing. That is why I am happy that the agreement is such a positive step.

There are several other cases to which I wish to draw attention. The BBC have broadcast programmes dealing with the people who have been convicted of the Birmingham pub bombings and the Guildford pub bombings. In the latter case concern is still being expressed by many people. I watched the recent programme on the Guildford pub bombings and I was seriously concerned. In some instances people were convicted on their own confessions. Carol Richardson, one of the people convicted, was able to prove she was elsewhere when the offence was committed and she had a proper alibi.

I should like to compliment the efforts of the investigating team involved in the television programme dealing with the matter and I should also like to compliment the media who went to the trouble of researching the cases in detail. Carol Richardson was given an alibi by a girl called Lisa Aston who stated she was with her on the day of the bombing. They attended a concert that evening. Another person was also able to state that he was with her at the same time.

What has happened in this and in other cases is alarming. It is essential that there be retrials in respect of the people convicted for the Birmingham pub bombings and the Guildford pub bombings. The anxiety of the people of Ireland in this matter should be conveyed to the British Government. If retrials are not ordered, the tragedy is that the people convicted will be left in prison indefinitely. The names of the people concerned are Paul Michael Hill, who got a term of imprisonment of natural life; Gerard Conlon, who got 30 years; Patrick Armstrong and Carol Richardson. They are entitled to a retrial in order to clear their names. This House must demand retrials in these cases and every pressure possible must be exerted on the British Government and the British Home Secretary in that connection.

I have dealt at length with this matter because I think it very important. The people in the North of Ireland must have confidence in the judicial system. Decisions such as the ones I have referred to encourage alienation of the minority community. Unless there are some positive developments in the matter, I shall speak on it again.

As a nation we face enormous problems. I listened with interest to some Fianna Fáil speakers talking about unemployment. I accept that the situation is serious but this Government are making a genuine effort to combat the problem. It is no harm to put on record that they have succeeded to a great degree in counteracting unemployment which became a major problem from May 1979 onwards.

Recently a trade union representative called for an election. This Government have achieved much during their period of office. Inflation has been reduced from a record 20 per cent to somewhere in the region of 4 or 5 per cent, with the possible reduction later in the year of another 2 per cent. This will be of immense importance and will be beneficial for all the people. The reduction in inflation has led to a reduction in interest rates and I hope this will continue also. Because people can now obtain finance at a reasonable price, the economy generally will improve. In the long term, the efforts made to date will be seen to be of enormous benefit.

I am very pleased with this Government's record in the housing area. This was one of the most serious problems in my constituency and I am very pleased that this Government have made a very positive effort to remedy the problem. There has been a great improvement in housing in Counties Laois and Offaly. The provision of proper housing is very important and as a Government we can be justifiably proud of our housing record to date. Tackling the housing problem has been an outstanding achievement of this Government and we are anxious to continue along the same lines. The drop in interest rates will be of great benefit to people buying houses.

When we came into Government we faced many serious problems. I believe the Taoiseach and his Government have shown great courage in tackling them. The Taoiseach has been accused of political lunacy. If it is political lunacy to try to unify the people of Ireland, to have vision and courage and be generous, then I hope I will stand indicted for the same offence.

In the years to come I believe this Taoiseach will be regarded with great respect. John F. Kennedy wrote a book called "Profiles in Courage". When a similar book is written about Irish politicians, names like O'Connell, Wolfe Tone, Parnell and Pearse will be mentioned but I believe a special section will be reserved for the Taoiseach, Deputy Garret FitzGerald. He has made an enormous contribution to this country. He has endeavoured to build a bridge to unite the people of Ireland. While he may never complete that bridge he will have laid the foundation stone.

Mr. Lenihan

I prefer to deal with reality. Deputy Enright was dealing with matters so totally unreal that it was hard to imagine we are in this House in July 1986 after nearly four years of incompetent and inept government. The Irish economy has been running down at an alarming rate and we never witnessed such economic stagnation. That is stultifying social progress and political action and has been caused because the people lack confidence in this Government. I am not talking about political confidence but a lack of confidence by investors. We cannot solve our problems by creating more employment and having an equitable taxation system unless there is rapidly increased investment by the State and the private sector. That is an elementary fact.

Last year the Public Capital Programme in all the productive economic sectors — industry, agriculture and infrastructure — was cut by £88 million. There is no private investment and no expansion in industry, small, medium or large firms. That is reflected in statistics like a 12 per cent decline in cement sales in the first four months of this year. For the first quarter of 1986 the transportable goods industry showed a zero growth rate and industrial employment is at the lowest level for 20 years. All this leads to a narrower tax base with the result that the Government are facing a review shortfall. There is evidence that this will lead to an even larger budget deficit in the coming year which will have to be met by more borrowing. The extent of the Government's failure in this area is enormous. This was one of the main criticisms made during the last general election.

Since this Coalition came into power the national debt has risen from £12.8 billion to £21.5 billion. In other words, the figure has almost doubled because this spendthrift Government borrowed prodigiously to prop up their own administration which they could not finance because of a declining and deteriorating economy.

At the beginning of June 234,000 people were unemployed, an increase of 3,200 on the previous month, many of them in the under 25 age group. I want to know why the June unemployment figures have not been released today as expected. While the May figures are at a record high, my information is that the June figures are even higher. I guarantee we will not get these figures until this debate is concluded. Then they will emerge in a newspaper column when this House has adjourned.

To compound the problem, according to the Government's figures on passenger movement, in two years there has been a rise of 10,000 people — now 64,000 people — going abroad. I am not saying all those people are emigrating permanently, but the rate of passenger movement has increased six fold over two years and a substantial proportion of those people — between 30,000 and 40,000 — will have emigrated permanently. This is another example of this Government's flawed record in economic development. Because of that flawed record there is no progress in social development.

The people have no confidence in any social proposals put forward by the Government because of their poor economic performance. We have here a flawed economic performance, a flawed social performance and, above all, a flawed political performance. Fundamentally, none of these aspects of economic development and social improvement can be put right unless a political will is exercised by a Government who command the confidence of the people and are in a position to restore the confidence of investors so as to have more investment for economic activity and thereby more jobs. It comes back to the basic fact that not just the people are switched off this Government, but the investment community are switched off by the mumbling and bumbling and bungling and fumbling and tumbling of this Government. On every issue proposed we have seen a series of gross mistakes and ineptitude in every aspect of administration. This Government have been on a rake's progress, lurching from one disaster to another.

I will mention three areas where through direct Government intervention and ineptitude £0.5 billion is on the way to being lost as far as the taxpayer is concerned — the ICI, Irish Shipping, and Dublin Gas. I challenge the Minister to deny that under those three headings of losses which can be attributed directly to the Government's action in those three areas the loss will be in the region of £500 million when the ultimate story is revealed. Already in the case of the ICI alone it has reached half that figure. It was originally contemplated to be of the order of £50 million. It is now approaching the order of £250 million. Between the series of crass errors committed in the case of the ICI and Irish Shipping, already the liquidation costs are ahead of what it would have cost to keeping Irish Shipping going over the next four to five years. Consider Dublin Gas, where mumbling and fumbling and delays caused by the Minister's ineptitude resulted in very severe losses in that area also.

We have a totally confused or a totally dishonest Taoiseach, or both. My firm conviction is that this Government have lost all moral authority to govern. They have no real legitimacy. No Government can carry on government and command confidence if the perception by the people of that Government is such that they have no confidence in them. If the perception by the investment area is such that they have no confidence to invest and if that lack of confidence permeates the whole of society, then there is no point in soldiering on, as The Irish Times suggests. The only honest thing to do in those circumstances is to resign. The only honest thing to do is to recognise that they no longer command as a Government the confidence of people and that they must let go the reins of power which they have been fumbling with and mumbling with and bungling with over a period of years, and finally face the fact that no confidence exists in our community.

Whatever is proposed by this Government in the way of a referendum, legislation, decision or regulation will not be regarded by the people in any positive sense because of the complete credibility gap that exists between the Government and the people. The peoples' perception of the Government is such that at this stage there is no point in them staying there, because any decision made by them and incorporated in anything of the order I have mentioned, be it legislation, decision or policy, will not be supported by the people because of the people's utter contempt at present of this Government who are perceived to be a lot of fumblers and bunglers who have failed completely in their elementary duty.

Acting Chairman (Mr. J. Doyle)

Unfortunately, Deputy, your time is up.

Mr. Lenihan

I want to say one thing before I finish, and you have been very kind to me. We have complete stagnation, paralysis in regard to decision making, and lack of political leadership. The Taoiseach is stuck in the mud in the trenches with the Tánaiste and one or two more and he is surrounded by a very mutinous army. The only thing for him to do is to surrender quietly and he will be treated well——

Mr. Kavanagh

Surrender to whom?

Mr. Lenihan

——and accorded full and decent rights as a democratic Leader of the Opposition here in Dáil Éireann for many years ahead.

Mr. Cowen

Everything they do is under cover of darkness.

The Tánaiste

Half of those fellows say we are doing nothing and the other half say we are doing it all the time. They will have to make up their minds. I trust they have minds.

This debate takes place at the end of a period which has seen great activity on a number of fronts, both economic and political. On the economic front, the period under review contained a great deal of good and positive news. The impact of the 1986 budget, and the overall low rate of inflation — both of these factors, combined with a number of specific items, constitute real grounds for hope that we will see substantial improvements in the standard of living of a great many of our people.

High among the list of specific items are, first, the continuing fall in interest rates generally and the mortgage rate in particular. It may not be appreciated that for a couple with an average mortgage, interest rate reductions have led to an increase in disposable income of £37 per month in just the last 15 months, with a further increase in disposable income imminent.

Second, reductions in energy costs have already been widely felt, with a further reduction of 7p per gallon of petrol this week alone. This has obvious benefits — benefits which are being felt not just by the motorist, but more and more throughout the economy.

I will be dealing with these matters again later in these remarks, but I feel it may be necessary to remind Deputies, especially those on the other side of the House, that there are major indicators of good and positive news on the way. The Opposition often accuse us of doom and gloom — but it is they who spend all of their time, as they have done in the last two days, whining that everything is wrong with the economy and nothing is right.

I was particularly interested, listening to Deputy Haughey this morning, to hear him attacking "wild promises" that had "no credibility with the people nowadays". I was not sure if it was nostalgia on his part, remembering the good old days when wild promises had a great deal of credibility, or a death-bed conversion. If it was the latter, then I suppose it is asking too much to express the hope that he will now retract some of the wild promises he has made in the last couple of months, to virtually every interest group he has addressed?

I would now like to deal with some more recent political developments. In the divorce referendum on Thursday of last week, 37 people out of every 100 voted in favour of change. Those 37 voted also for tolerance, for respect for the rights of minorities, for a greater measure of freedom. I am convinced that many more would have voted for these things too, but were afraid to. It would be a mistake to assume too readily that those who voted "no" were voting for intolerence.

A great many people were frightened by the tactics of the anti-divorce campaign. These tactics were based in the main on lies and dishonesty, and if we failed in the campaign, it was at least partly because we failed to expose those lies effectively enough. Questions are now being asked by commentators and others about such issues as judgment in putting this issue before the people and in the nature of the campaign. It is appropriate that we should also address those issues, and that we should try to ignore the fact that some of those commentators who have been most critical would be the same people who would accuse us of shirking the issue if it had not been put.

I am proud of the fact that a Government in which the Labour Party were participating put this issue before the people. I believe that, in the fullness of time, the debate we have had in the last few weeks will be seen to have opened many doors. We have exposed aspects of ourselves and our lives to public view, and we have awakened a sensitivity to the suffering of others — a sensitivity that will grow rather than diminish. We in the Labour Party played a full role in that debate, and we have nothing to apologise for in that.

I must place on record my appreciation of, and admiration for, the role played by the Taoiseach in opening up this issue to debate and decision. The Taoiseach has displayed considerable leadership and moral courage — commodities singularly lacking in certain other quarters to which I will refer later. He deserves the gratitude of countless thousands of people who are trapped in broken marriages, and of others who are committed to a more pluralist and less prohibitive society. Even if the effort was not successful on this occasion, it will come to be seen as a historic one.

John Hume, and other members of the SDLP, also provided significant leadership. Their pleas for tolerance and respect for the rights of minorities were among the most eloquent of the campaign, and came from the depths of experience. I am sure many people, including many members of Fianna Fáil, must have been saddened to hear John Hume being denigrated by Deputy Haughey in the aftermath of the referendum.

We have reason, too, to be grateful for the work and support given by the Irish Congress of Trade Unions, and by a number of individual unions who were active in the campaign for change. Finally, I believe I should record my appreciation of the work of the Attorney General, John Rogers, in this area. Since his appointment he has brought an awareness and a sensitivity of his office — an awareness of the many wrongs and injustices in our society, and a sensitivity to the need for change.

I said earlier that the people had been frightened by a campaign of fear waged by the anti-divorce propagandists. In time that will become apparent and the scurrilous nature of that campaign will be a source of regret for many. Just as it has now condemned thousands of people to continue living in a legal limbo, so also it will come to be seen as a denial of the basic truth of the arguments we made.

What can one say of the role played by Fianna Fáil, and especially their leader? He agreed at the outset that it was right to have a referendum — that the people were entitled to a choice; and then when he knew the outcome he accused us of bad judgment. He pretended to be neutral, to be open, while at the same time his party were covertly campaigning to secure the defeat of the amendment. He calls now for compassion for the people suffering in marriage breakdown, and for action on their behalf. Why is he only lifting his voice now?

Perhaps the most outrageous element in Deputy Haughey's behaviour in this whole affair is to be seen in the comments he made last Sunday, when he admitted that he was prepared to acquiesce in a situation where, into perpetuity, he could envisage different laws and different social systems on both parts of this island. It did not matter that those laws might be considered sectarian in the context of the whole island. It did not even matter that the Catholic Bishops at the Forum had themselves disavowed such an approach. Deputy Haughey is quite happy to see laws which discriminate against minorities remaining intact, and quite happy to assert that this is entirely consistent with the option of a unitary state outlined in the Forum report.

These comments by Deputy Haughey were the most succinct statement of a partitionist mentality I have heard. He has no interest in breaking down barriers between people; his concept of republicanism has no tolerance within it for minorities; his famous statement that the Unionists would be surprised at how generous he could be means very little. What does Deputy Haughey want, apart from the removal of British troops and the dismantling of customs posts? This much we can say for as long as the attitudes Deputy Haughey espouses hold sway, the Border will remain intact, because it is a great deal more than a line dividing territory. The partition of our island is to be found in the hearts and minds of people, and not just in the land.

A number of attempts have been made in the past to amend the Constitution. By and large, two things have emerged from the history of those efforts. First, in only one case — the EC referendum — was it possible to succeed without all-party support. Fianna Fáil "neutrality" does not count. Second, the Governments which suffered reverses in referenda — I am thinking principally of the referenda to do away with PR — found subsequently that those reverses did not prevent them from winning elections.

Before turning to other subjects, I want to make two points. First, I believe that the Labour Party were instrumental in ensuring that the people were offered a choice in this matter. The party were effective and creative in the way in which they pursued the campaign. We were, in my view, the most effective element in the campaign. This effort brought out much that is best in the campaigning and crusading tradition of our party. As a small party, with limited resources, we have every reason to be proud of the contribution we made to public debate and decision. To everyone who voted "yes", and to many more who are genuinely concerned about a major social problem, we intend in the months ahead to say that there is a party in Irish politics prepared to put their money where their mouth is when issues involving change are on the agenda.

Second, the issue of marriage breakdown will not go away. There has been much talk in the past few days about reexamining the area of nullity. A lot of this talk is dangerous and misguided. Unless and until the Constitution is changed, there is no possibility of ending the agony of a broken marriage for many thousands of couples through an annulment process. To suggest that it is a simple matter to extend the grounds of nullity, in the belief that it will then be possible to get around the constitutional prohibition, is quite wrong, and likely to raise false hopes. We have to do everything we can for those couples who are in distress, but we should not attempt to fool people that if they cannot get a divorce, they will always be able to get an annulment. For us, the need to extend the right to couples whose marriages are irretrievably broken down remains unfinished business. The campaign will have to go on, until justice can be done.

One final point — Deputy Haughey called for an assurance this morning that no understanding exists with the British Government about the removal of Articles 2 and 3 from our Constitution. Apart from expressing surprise that Deputy Haughey should be impressed with a statement made by Mr. Molyneaux, I can reassure him and the House absolutely on that issue. The development of our Constitution is a matter for the people of this country, and no one else.

If the major political development of the last session was the referendum, it was not the only important development. High on the list of achievements in this last three months was the passage into law of the Act establishing the National Development Corporation.

The creation of a body such as the NDC has been an important priority for the Labour Party for many years now. We have argued that there is every reason for the State to get involved in the creation of viable, self-sustaining jobs in each and every sector of the economy where scope can be found. The principal reason this is necessary is that, despite all the subsidies and incentives, despite all the effort made to produce a climate as beneficial as possible, the private sector have not succeeded in creating the tens of thousands of jobs we need.

Many private sector companies are unwilling to take the risks that are sometimes necessary. Others are unwilling to tie up capital for a long period of time before seeing a return. Others stipulate a very high level of potential profit before expressing a willingness to invest, and do not always measure profit in terms of the social contribution made through job creation.

The establishment of the NDC will enable us to bring a different equation into play. I expect the NDC to operate to the highest and the best commercial standards in selecting investments and in making management decisions, but it will have at the forefront of its priorities the need to respond to our unemployment problem. It will have the power to do so on its own, or in co-operation with the other sectors of the economy — the agricultural sector, private manufacturing or service industries, or the co-operative sector itself.

There is something of a myth about the attitude of those of us on the left to co-operation with the private sector. It is worth reiterating a point I have made in this connection before. There seem to be some who believe that we lack enthusiasm for productive, efficient effort leading to adequate profit. Nothing could be further from the truth. No one would be more supportive than I of a genuine partnership between the public and private sectors. But it has been my experience that when others talk about such partnership they frequently mean a sharing where the public sector is guaranteed to lose out. In too many cases the public sector is invited to share the risk, while the private sector takes the profit.

There are a number of issues facing this Government and the people about which there is little disagreement in this House. There is no disagreement about the need to maintain control of public expenditure; there is no disagreement that the level of personal taxation for PAYE workers is too high; there is no disagreement about the need to tackle unemployment as the greatest priority; there is no disagreement about the need to ensure that the maximum return is achieved from the resources of the State.

But there is a great deal of disagreement about the way in which these objectives should be met. Of late, one simple formula appears to be emerging which has a great deal of superficial attraction, because it is being presented as a solution to all of these problems. The formula runs something like this, when it is stripped down to its essentials: sell the State's assets to pay the debts; slash any expenditure that is arbitrarily declared to be unnecessary; and cut personal taxation, especially for the better of — the theory is that this will generate a climate for job creation. This is, as I have said, a superficially attractive formula. It is also highly dangerous and potentially terribly divisive.

Mr. Haughey

Hear, hear.

The Tánaiste

We must face the need to contain public expenditure, as a Government and as a community — I accept that fully. But we must do so while at the same time having regard to the need for fairness and for justice. The notion that sharp cuts can be made in essential social services, at a time when so many are dependent on them, has to be regarded as unacceptable. It becomes particularly unacceptable when it is accompanied by attacks on those who are dependent, as is increasingly the case nowdays. If there is abuse in our social services, it has to be discovered and rooted out — but it will never be acceptable to eliminate or diminish essential systems of State support because a small minority are abusing them.

By the same token, suggestions that a significant portion of the assets of the State can be sold off are highly misleading. Many of the assets of the State are in the form of productive enterprises, some of them profitable, others with a potential for profit. Our aim must be to ensure, through more effective management and a high degree of motivation and co-operation, that all of the State's enterprises are making a contribution, not only to their shareholders — the people of this country — but also to general economic growth. We have shown that can be done — in small companies like the Great Southern Hotels and in great companies like Aer Lingus. And we have shown that it can be done in a public sector context.

Other companies run by the State provide essential services, many of them of a strategic nature, such as transport. There is no doubt that there are elements of these companies which would be attractive to the private sector; but selling them would have the inevitable consequence that the social element of the service provided would quickly be lost sight of.

And still other State companies, or companies in which the State has a significant shareholding, are involved in the development of natural resources. I believe, as a matter of fundamental principal, that the development of our natural resources, whether we are talking about gas, turf, wood or food, must be carried out in the interests of the people as a whole. This can only be done by maintaining a very high level of public sector involvement. Selling any of these enterprises in return for a "quick fix" of cash is selling out the longer term interests of the people. It might well generate shortterm popularity for whoever proposes it, but it is not what I came into politics to do. In this connection, I note that Deputy Haughey, while on the one hand promising to develop our natural resources extensively this morning, does not want me to take any action in this area at all. I am not sure what to make of this. If Deputy Haughey wants my assurance that the interests of the people of this country will be fully protected in any action I take, and that that will be my paramount consideration, he can have that assurance in the most wholehearted way.

How then do we deal with the crying need to reduce taxation? In my view a number of ingredients are necessary. The first is to recognise where the problem lies. It lies first and foremost with the PAYE sector, and it exists, in large measure, because other sectors are not paying their fair share. I have said on other occasions that if it is necessary to put people in jail to ensure equity in our taxation system, then we will have to do it. But how much better it would be if it were possible to appeal to a spirit of fairness throughout the community in bringing about equity.

Secondly, we have to build on the success we have achieved in developing a more competitive economy, to ensure that a higher level of growth enables us to cope better with the conflicting demands of a necessarily high level of public expenditure and for a reduction in taxes for PAYE workers.

I would like now to refer briefly to a number of issues with which I have had to deal in the last few months as Minister for Energy. In the period under review the justified concern felt by many Irish people about nuclear radiation was hightened by the incident at Chernobyl in the Soviet Union and by the long delays before adequate information was made available by the Soviet authorities. It confirmed the view, long held by many of us, that nuclear power was an unacceptable way of generating energy and that it is difficult, if not impossible, to have any faith in the capabilities, or even the honesty, of many of the people and bodies charged with the management of these installations. In this country we have had a great deal of experience of the incompetence of British Nuclear Fuels and have come to regard Sellafield as an unwelcome and dangerous enemy just off our coast.

Mr. Haughey

Hear, hear.

The Tánaiste

I have been pressed many times to call for the closure of Sellafield. I think it ought to be obvious that calling for its closure is not enough. Simply to do so would be a bit like the little boy telling his mother that he is going to run away, and then she will be sorry. We have to take very firm and very practical action in relation to that monstrosity. Asking a sovereign foreign Government to do anything it is not willing to do is hardly practical action. That is why, long before Chernobyl, we made a formal request to the European Commission to establish a Community Health and Safety Inspection Force which can determine the safety of nuclear installations within the Community. At a meeting on 6 June last between the Attorney General's Office and the Legal Service of the Commission, the Commission agreed that they have the competence under the Euratom Treaty to take the initiative to set up such an inspection force. I hope those members of Fianna Fáil who have been repeating the canard first propagated by Deputy Haughey that there is no such competence will take note of this point.

The Commission has already indicated that it intends to submit to the Council, later this month, a comprehensive communication on the ways in which the relevant portions of the Euratom Treaty might be put into effect. Their outline plan of action takes note of the priority we attach to the establishment of a Community inspectorate. I will be continuing to press for prompt Community action in this regard.

In so far as this country was affected by Chernobyl, we were lucky that the level of fallout was not sufficient to cause any danger. We are continuing to monitor the longer term effects and we are also continuing to strengthen the capacity of the Nuclear Energy Board in undertaking this work. I feel it is appropriate to pay a tribute to the dedication of the officials of that board and the people who worked long and exhausting hours with them to ensure that the Irish people had information available more promptly than any other country in Europe.

I think it is now possible to reflect that we were lucky, too, that the level of radiation involved, while not enough to affect us in terms of health or welfare, was certainly enough to awaken in all of us a new consciousness of the dangers of us the nuclear industry. Many of us in this country have always felt that we could do a small service to the world by declaring that the soil of our country would never be allowed to house a nuclear installation. I believe the numbers who feel that way have grown enormously — to such an extent that it is now fashionable to disavow any previous interest a politician might have had in the development of nuclear power.

Turning next to the important question of oil and gas exploration which I have already mentioned briefly, Deputies should be aware that, despite the fall in oil prices, this year will be the busiest year for drilling since 1978. Three exploration wells have been completed so far and the data from these wells will be analysed over the coming months to establish whether or not further exploration work in these particular licensed areas is desirable. Plans for further wells are in the course of preparation and in some cases are at an advanced stage. Onshore, activity still continues in the Lough Allen basin, principally in Counties Cavan and Leitrim, where a comprehensive review of the large amount of geological and geophysical data already obtained is under way. Further south, I expect a well to be drilled this year in what is known as the Castlecomer basin. There is therefore good reason to be satisfied that the Government's hydrocarbon exploration policy is bearing fruit and that the search for commercial oil and additional reserves of natural gas is proceeding satisfactorily.

However, as I have told the House recently in the course of my Estimate debate it is clear that the very dramatic fall in oil prices has given rise to difficulties for the oil exploration industry, and a large number of companies have announced budget cuts which are affecting their exploration efforts not only in this country but around the world. As Minister for Energy, I must look beyond work arising out of existing commitments because it is in our interests — and in the interest of the industry — that exploration continues during this period of depressed prices. The conventional wisdom is, of course, that prices must rise again and the only question in doubt is when this will happen. While a stable and reasonably high price is obviously the best inventive for continued exploration, it may be that other ways will have to be found to maintain the impetus of our exploration programme. I am therefore considering what, if any, additional steps on our part need to be taken to encourage further exploration offshore Ireland in the years ahead. I am very conscious, as I have always been, that any concessions in this area will have to be carefully balanced with the overall need to ensure that the Irish people derive the maximum benefit from this natural resource. As I have said before, there can be no benefit for the people if no development takes place, and development depends to a considerable extent on a continuing programme of exploration. By the same token, any development must ensure that the people benefit.

The need to balance these considerations is forming an important part of the work my Department are undertaking at present. We are also taking into account the views of the oil companies, together with the need to be competitive, as well as the views of relevant international experts. I expect that this work will be completed soon. I believe we can look to the future with a reasonable degree of optimism and it is my opinion that the confidence of the exploration industry in Ireland's offshore potential will not be misplaced.

Turning now to a number of issues that arise under the heading of natural gas distribution, it would be remiss of me not to refer to the problems of gas distribution in Dublin. The Dublin Gas Company over a period of time experienced severe problems, partly caused by the oil price reduction but also by other difficulties which were incapable of being resolved by intensive discussions between BGE, the company, and my Department. As a result of further investigations it was clear to me that there were a number of deep underlying problems which had to be dealt with in order to protect the substantial State investment and interests in the company, and to assure the continued supply of natural gas in the Dublin area.

A receiver was appointed to the company by BGE. The remit of the receiver is to overcome the very serious problems the company have and to place it on a sound footing prior to nationalisation. Until I have fully considered the report and recommendations of the receiver I am, as the House will appreciate, unable to comment further. I would, however, remind the House that it is the receiver's intention to ensure payment to all creditors where the claims, whether in respect of work or services carried out, are valid. I am quite satisfied that I, as Minister for Energy, and the Government, have discharged, in a responsible fashion, our duties to all concerned in this matter.

Fianna Fáil have called on a number of occasions for the extension of natural gas to a number of towns in the south. While they have been talking about it, I have been arranging that it be done. The pipelines to Waterford and Limerick will be fully operational by the end of this year. A decision in principle to supply gas to Clonmel was made, and the details will be finalised soon. The Government have recently agreed to extend the network to Kilkenny. The Cork Gas Company which is now a public company like most of the others, have undertaken a major over-haul, with a view to protecting the company's customers and improving financial performance. Following the EC's decision to provide up to £23 million for a gas development programme in the north-east and Border counties, a programme based on that funding is now under consideration.

Deputies will be aware that on 18 June last the agreement with Gulf/Chevron concerning the ownership of the oil terminal at Whiddy Island was formally concluded. On that date, Gulf/Chevron transferred to the State £44 million in cash and the oil terminal itself. The cash injection represents a significant accrual to the Exchequer. The physical assets have been transferred to the ownership of the INPC which will act as the State's agent in maintaining the facility at minimum cost and maintaining the integrity of its oil storage capacity should it be required in the future. I recently mentioned that the INPC have been evaluating the possibility of developments in aquaculture at the terminal involving joint venture arrangements, and if this proves feasible I would consider it a welcome development for the facility, and over time, for the locality.

Last year was an extremely difficult one for Bord na Móna. Hundreds of jobs were threatened following the disastrous weather. There were a great number of calls from Fianna Fáil Deputies for intervention, and for any action to be taken which would avert the threat to jobs. It will not surprise anyone when I record that I did not receive any calls or letters from the same Fianna Fáil Deputies when the danger to permanent jobs was averted.

For some time I have been conscious of the need to alleviate the high cost of electricity, to consumers generally and especially to industry. The Jacobsen Report found that, while the price of electricity to domestic consumers in Ireland was in the middle range of prices in European countries, industrial electricity prices were higher than average. This obviously gives rise to concern, particularly at the thought that our exporting industries should be at any disadvantage vis-á-vis their competitors.

The ESB, with my approval, have been moving gradually to improve the price to industry by a judicious tilting of the balance at each review. This has obvious importance for job creation and for the protection of jobs in a competitive economy. The first stage of this improvement was in 1985 when I announced an average reduction of 2 per cent to 6 per cent for industrial users. In the round of small price increases announced at the end of 1985, we managed to avoid imposing any increases on industry. On 11 March this year I announced a further reduction of 6.2 per cent on average for industry.

At the same time I announced a reduction of 5 per cent for all domestic consumers, to take effect from 1 September. As I stated when I announced these reductions, both I and the ESB will keep electricity prices under review. I am very optimistic that it will be possible to reduce prices further in the short to medium term.

Before concluding, I feel I ought to remind the House of other significant developments in the period now ending. With the passage of the Finance Act, we put into place a new stream of incentives to encourage development in our inner cities. I expect these incentives, which are both generous and extensive, to have a profound effect in the medium term on the neglected and sometimes derelict areas of Dublin, Cork, Limerick, Galway and Waterford that are affected.

Mr. Lyons

All of Cork is affected. The Government have devastated it.

The Tánaiste

Of more immediate impact, I expect to see an effect on the construction industry, which has been sorely hit by the fall-off in private investment in the past few years.

This package of incentives, added to the earlier schemes such as the home improvement scheme should, by the end of the summer, be helping considerably to provide hope for the unemployed. The level of unemployment in this past few months has remained, in my view, dangerously high, and there are signs that it will be some months more before we can see a real stabilisation of the figures. The number of school leavers going immediately onto the live register will keep the figures high for a number of months yet.

By the end of the summer, there should be visible signs of improvements in the standard of living of many of our people. This will have happened because of a combination of a number of things: the reduction in inflation, which will be even more pronounced by then; the working through of the substantial tax adjustments contained in the last budget; the effects of the improvements in child benefit; reductions in the prices of a number of essential commodities, including electricity, and a range of others affected by recent VAT reductions; and of course the interest rate reductions I have already mentioned. All of these things will have positive effects, not alone on standards of living but also on the confidence that we need as a community in facing the future.

By the time this House reassembles, this Government will be approaching the end of their fourth year in office. We will have been in office almost as long as the Fianna Fáil Government of 1977 to 1981, which, as Deputies will recall, had for much of that time a 20-seat majority. I reflect, every time I hear Fianna Fáil talking about stable Government, that the last four years have been a great deal more stable than that long period of Government.

Mr. Lenihan

Stagnation.

Mr. Lyons

The Tánaiste should deal with unemployment. He is not up to date.

The Tánaiste

I trust the Deputies opposite, and the people who may join their party in the future, will want to forget 1977-81.

An Ceann Comhairle

The Tánaiste has two minutes to complete his contribution.

The Tánaiste

We have had our disagreements, to be sure, and always about worth while issues. When I heard Deputy O'Malley talking about "ideological irreconcilables" yesterday, I tried to think of issues that had been impossible to reconcile in the past four years. I could think of several, as it happened, but they all involved Fianna Fáil, and many of them involved Deputy O'Malley himself.

Although we have had our disagreements, as I have said, they have been about worth while issues, and they have never, unlike Fianna Fáil, been clouded by issues of personality as well. In our four years of office, although we have made mistakes — they say it is human to err — we have never tried to buy votes in by-elections, or bugged each other's conversations, or tapped journalists' phones, or fiddled the Estimates.