Dáil Éireann debate -
Thursday, 23 Oct 1986

Vol. 369 No. 2

Confidence in Government: Motion (Resumed).

Debate resumed on the following motion:

That Dáil Éireann reaffirms its confidence in the Taoiseach and the Government.

— (The Taoiseach.)

Mr. Lenihan

The situation we now face is that the Taoiseach and his Government have lost all power and authority to rule. They have no real legitimacy to continue governing the Irish people. Technically, they may be able to squeeze by, as they did yesterday on a majority of one; technically, on the numbers gained they may cobble together tenuous arrangments with various dissident supporters and seek to win a majority in this House, albeit as slim as possible. That does not mean they have any real legitimacy to govern the country and to carry out the policies and implement the decisions which are necessary at present. We now see a Government who are emasculated and incapable of taking the vital decisions that are needed to restore national morale and confidence.

It is quite clear to any rational independent observer, and there are enough of them who will fully support us in the next general election, that matters will go from bad to worse. Inevitably, as night follows day, matters will deteriorate in the whole area of social, economic and financial development, the state of the public finances and confidence in our political institutions. The independent-minded public see it that way. This is precisely the situation envisaged in our Constitution in which the Taoiseach is empowered to exercise his prerogative to dissolve the Dáil. In every parliamentary democracy in the world, the Prime Minister of the day has the power to dissolve parliament and seek a mandate or a rejection from the people as to who should resume the constructive and responsible Government of the country. It is quite clear that after four years of mismanagement this Government have lost the confidence of the people, of their own supporters within the two parties which comprise the Government and are incapable of taking the sort of decisions that are needed at present.

The major decision now facing the Government is to squeeze support from reluctant Deputies in order to bring in a budget in January, if they last that long, a budget that can cater for the urgent requirements of the nation. This Government are in a state of siege. They are beleaguered on all sides, not by the people who are waiting patiently outside to make their verdict known, but by their own supporters and their own members. This Government are now unworkable and are in a hopeless and untenable position. When a Government become unworkable the Taoiseach or the Prime Minister of the day has a moral obligation and responsibility to dissolve parliament, to seek a mandate from the people and ask them for their view on his Government or on whatever alternative Government they may seek to elect.

This bunker politics which we are witnessing at the moment is reminiscent of — and it is the nearest parallel I can think of— the dying days of Mr. Callaghan's last Labour Government in Britain. That administration had to limp from day to day fumbling away with the extraordinary support of Mr. Fitt and the Ulster unionists. That was the sort of support on which a socialist administration in Britain was ultimately forced to rely in order to carry on for a few more weeks. The result of that sort of adminstration was to bring the whole British economic and financial system crashing about the ears of the Government.

We have plenty of precedent of the honourable decision being made to dissolve the Dáil at the appropriate time. Mr. de Valera dissolved the Dáil in 1948 before his term of office had expired. Mr. Lemass dissolved it in 1965 and Mr. Lynch dissolved it in 1973. They are three honourable occasions on which the Dáil was dissolved before the full term expired, when it became apparent to sensitive and sensible political leaders that the people should be consulted. At present we have a Taoiseach who is totally insensitive and who does not know what politics and public affairs are about. He does not have any sensitivity or feel for public opinion or for what concerns the public. Those three Fianna Fáil leaders decided to dissolve the Dáil when it became quite apparent that there was uncertainty in the air, that there was danger of instability, and that it was important to consult the people. In 1948 when Mr. de Valera dissolved the Dáil Fianna Fáil were rejected. In 1965 Fianna Fáil were re-elected and in 1973 Fianna Fáil were rejected. On each of the three occasions there was no vested interest in going to the people. There was a profound desire to ensure that stability was maintained, that when uncertainty was in the air the Government would do the right thing by consulting the people and getting a democratic mandate.

The purpose of the motion before the House is to seek to establish if we can in the Taoiseach's mindless mind and in the minds of his Government Ministers that they have an overriding duty to the Irish people, to themselves and their own sense of integrity and principle to dissolve the Dáil and to ask the people their view of the four years of Government. The people will be presented with Fianna Fáil as the rational alternative and they will make the appropriate decision. Whatever the decision, it is important that the people be consulted at present in order to remove the uncertainty and instability that is bringing this country down. There is no doubt that this Government do not have the political will or the capacity to make that elementary decision. Apart from that, they had not the political will or the capacity to deal with a whole range of serious financial, economic and social problems that beset our society.

The major cause of the present economic stagnation is a very basic one. It is the collapse of investment: foreign investment coming into this country, domestic investment from within the country, private investment from inside and outside the country and public investment by the Government, local authorities and State-sponsored bodies. That decline in investment is reflected in a whole host of economic, social and financial problems which are all related to that central factor of total cessation of investment in our economy at present.

Over the past four years of Coalition Government economic growth has been negative, minus 1 per cent, compared to 23 per cent economic growth in 1977-81. It is futile for the Taoiseach or any Government Minister to talk about achievement in regard to reducing the rate of inflation. That is no achievement whatever when it is related to a fall of that magnitude in investment over the same period, when it is related to 250,000 people unemployed and when practically 100,000 people have emigrated. One puts in the balance the rundown of the economy, the flight of money from the economy, the lack of investment in the economy, the rise in unemployment, the rise in emigration and the shrinking number of working people paying more taxes. When one puts all of that into the scale against a reduction in inflation one can see where should be the national priority. Of course you can reduce inflation. You can reduce it to zero, as zero equals zero equals zero. You can produce a beautiful set of accounts that show there has been no inflation, no growth and no people employed. That is the extreme example of bringing down inflation to the negation of all the other economic, social and financial objectives within our society. That sort of economic growth, where over a four-year period it has actually fallen, lies at the heart of, and is germane to our whole problem. When one compared it with the 23 per cent growth in the previous four years one sees the relevance of what I am saying.

Employment generally has now fallen to its lowest level for ten years. That is an irrefutable fact. Industrial investment alone, on which we depend primarily for jobs, has fallen by half. The public capital programme has been cut by one-third in the employment area, the area of job creation in so far as the public sector can help by way of industrial investment, while day-to-day current expenditure for the Government has gone through the roof.

This decline in investment can be reversed. It is not impossible to do that if there is not a paralysis of political will in regard to decision making. This decline in investment can be reversed by a positive programme of incentives in the private sector in selective areas of growth that are feasible in terms of economic development such as natural resources, tourism, timber, agriculture and the greatest resource of all, our trained and educated people. It can be reversed by a programme of incentives in the electronics and computer fields and in selective areas where we feel we can apply our talents and investment best, where profits are not going to disappear in repatriation through a black hole somewhere abroad or where too high a percentage of imported materials are being used so that the net benefit to the overall national economy is very dubious. A range of incentives to the private sector is needed in selected areas of investment here at home to be administered through the IDA in order to stimulate growth and expansion. There is need for a substantial increase in State investment in the productive sector of the economy and if that means borrowing for productive purposes that is right.

One classical example of a major error by this Government in regard to the whole incentive area, probably the most negative decision made by this Government — we warned them of it at the time — was the introduction of DIRT in the last budget. It was quite evident that the arbitrary 35 per cent imposition in a unilateral manner imposing a tax of that kind on savings would lead to precisely the trouble that occurred. We said so in the course of the budget debates here early last year but no heed was paid to us. Now every economic commentator and observer agrees that it has been the biggest single determinant in the run of money out of the country over the past 12 months. Since the introduction of that tax the flight of capital has been inevitable because it was immediately perceived by large and small investors to be a direct attack on savings, which it was. I do not have to go into the litany of the facts where £1,500 million has departed from this country as a direct result of the negative effect of the imposition of that tax. When the whole emphasis should be on incentives towards saving and investment we bring in a tax that is a direct deterrent to savings and investment. That tax along with the doubling of VAT to 10 per cent in regard to house purchase were the factors in which deliberate Government policy deterred savings and investment.

I know that the country has plenty of problems the Government can do nothing about. We are all in a difficulty of having exchange control in a small trading country like Ireland and the volatile nature of worldwide interest rates, but here are two decisions taken by a Government who obviously have given no thought or study to the implications of what they were doing. Those two decisions alone are sufficient to indict this Government of total carelessness and lack of heed, concern and thought for the real needs of the economy. Disincentive measures were brought in in regard to savings and investment where the need was really for positive incentives to stimulate the economy, for investment and for savings as the basis for investment. This run of money out of the country since the introduction of DIRT is a serious blow to any lingering prospects of creating more jobs and curtailing unemployment and emigration. This reduction in jobs has meant that a shrinking number of people at work are paying more taxes. The result is that the public finances are in complete disorder because if fewer people are forced to pay more taxes then obviously there is a ceiling in regard to revenue.

Of course, there has been a revenue shortfall this year, along with an irresponsible overrun by the Government in regard to current Government expenditure, yet they went off on an optimistic hobby horse, telling each other earlier this year after the budget that there would be a mini boom, a consumer boom which would yield more revenue before the end of the year. There is no consumer boom and there is less revenue. On the basis of that crazy prediction Government Departments proceeded to spend more money. At any rate the effect of the disorder in taxes, revenue and public finances is that £1,500 million will have to be borrowed this year on top of taxes to finance the Government's day to day expenditure, and that is running at £180 million on the latest Government admission, coming up to £200 million over target.

As a result of all of that we are in the appalling position of the Government being in grave difficulty in regard to raising money for current expenditure. Anybody involved with the stock market or with the financial institutions can bear me out on that. This money will have to be raised before the end of the year to pay off the deficit. Because of the difficulty in raising funds the Government are forced to pay high interest rates resulting in increased rates for borrowers and mortgage holders. In addition to the world situation with regard to interest rates, the Irish Government are putting themselves into a position where money is being forced reluctantly out of the system with the result that there is less for private enterprise. This is all because the Government are paying over the odds in interest rates to get the money to finance their spendthrift administration.

At this point there is no future in engaging in the sort of arid academic debate to which we were subjected by the Taoiseach in his Ard Fheis speech over the weekend, in which he concentrated on who was right or who was wrong in the past. There was an extraordinary return by him to 1922 to in some way justify the progress made by this Government in the past four years compared with the period 1922-23-24. That was 64 years ago; two generations have passed away since then. I was talking to people in my constituency the day after the Taoiseach made that speech and they were amazed at this academic treatise, relating the success of this Government in 1986 to the sort of society that was taken over by Cumann na nGael in 1922. That is arid academic nonsense. It was all very well as a treatise to a lot of undergraduates on the history of the State, but it has no relevance whatever to the real problems facing people in 1986. The people I met thought the Taoiseach had just gone bonkers relating back to the dim and distant past of 60 years ago to draw comparisons with the beleagured people of the present whose families are unemployed, who are paying heavy mortgage rates, who are training and educating young people for emigration to Britain, the United States or Australia.

What are required now are a Government who will grasp the problems of 1986. That is what we are talking about. We must have a Government who will initiate a programme of expansion from now into the nineties. We must get away from the flawed personality bias that has been introduced into political debate in the past few years by the Taoiseach. We need to get down to comprehensive, economic and social planning for expansion, jobs and investment. We need a Government elected by the people as a single party secure in its majority, concentrating on getting that job of expansion under way through the stimulation of investment, through consciously striving to achieve economic goals and, on that basis, all other progress can fit into place. The desirable, social, political and other objectives, for example, tax equity and fairness, can only take place on the solid base of economic progress and expansion. We need a new Government who will plan comprehensively for that purpose and, with the 53 per cent support of the people, Fianna Fáil represent the only single party who can credibly obtain a clear majority in the coming general election and govern the country decisively for the next five years. That is a fact of political life. It is also a fact that Coalitions do not work and ringing the changes on various combinations of Coalitions will not work. Investment confidence will disappear for years if there is a weak Dáil after the next election. There is no way in which this beleagured Government, seeking to squeeze support from reluctant Deputies, can bring in a budget in January that caters for the urgent requirements that face the nation. The whole purpose of this motion is to indicate loud and clear that this Government must hand over to a party backed by the people to reinvigorate the economy and recreate the confidence which made this country great until recent years and can do so again.

Minister for the Environment (Mr. Boland)

Deputy Lenihan certainly has a particular panache for filling the House with cliché inflated balloons of flowery prose. He is adept at telling the Government what they cannot do but his contributions in recent years and the repeated confidence motions we have had in times past are rather short on information about how his party would go about addressing the problems that face the nation.

One cannot but have a sense of déja vu when asked to speak again on a motion of confidence. We are now in a situation where after a ritual six months in office a motion of no confidence is automatically tabled by the Opposition and the valuable time of the Dáil is wasted in going through this futile exercise. I would have thought that at a time when there are so many real issues to be tackled and when the programme for the Dáil is literally crammed with numerous much needed reforming measures, when more than ever people are demanding a constructive contribution from elected politicians, we should not be forced to go once again through the empty charade of a no confidence motion — for the second time this year. This, instead of being a useful exercise, is an extraordinary waste of valuable Dáil time.

I would have thought that when the Dáil was commencing business for the autumn session Deputies would have been more anxious to address themselves to the real problems of the day and to the proposals in legislative form which the Government have before the Dáil to deal with a number of those problems. Instead we are being asked to participate in what is a totally negative transparently political exercise which will not help one iota in solving the many real problems facing the country. Indeed, if this debate makes any contributions to the economy it is that unfortunately in the last week to ten days, it has had a negative and damaging effect on the financial markets.

It was interesting to listen to the concluding remarks of Deputy Lenihan. He referred to those who had close contacts with the financial markets. One can only wonder at the degree of irresponsibility of an Opposition who know that tabling this motion of no confidence, and seeing that the Dáil session commenced in this way, will have had an inevitable contributory effect on the volatility in financial markets. This has helped to contribute to the instability of those markets in recent days and if proof were needed that that is so one needs only read the financial pages of the daily newspapers over the last few days. Each day, including this morning, spokesmen for the market said they believed interest rates would reduce and stability would return once this motion of no confidence had been disposed of in the Dáil. Knowing that the tabling of such a motion would have that effect on financial markets, interest rates and consequently on the economy and Exchequer finances, and ultimately on the rates charged to personal borrowers and mortgage holders, one can only wonder at the irresponsibility of an Opposition who would still so recklessly table this motion and demand that the first two days of this Dáil session be taken up debating it.

In a way, I suppose it solves a problem for the Opposition because a debate like this is an easy substitute to advance political bluster instead of constructive parliamentary opposition. The complete failure of the Opposition to contribute profitably to legislation, or even to criticise constructively, is constantly exposed in debates on Bills in this House. As I have said before, that consistently poor performance is due to the fact that there is apparently an all-consuming debate in that party on policy development which results in a total lack of advancement or publication or advocacy of any particular political philosophy. They choose instead to be a reactionary party, choosing their moment to criticise, to comment destructively, but never apparently to suggest what would be their course. It seems that in recent years the Opposition have become a party where debate internally is stifled and policy discussion both on social and economic questions appears to have fossilized. I think this is because they give no real leadership and have no real policies and direction. This means the Opposition are prey to every pressure group and are drawn into, on the one hand, reacting negatively to anything that is advanced by the Government and, on the other hand, into making easy promises in response to every problem. These promises, if they are to be fulfilled will be once again at the price of mortgaging the future of the nation.

I should like to ask the Dáil to pass the vote of confidence in the Government, first on the basis of our consistent and solid record of achievement and, secondly, because of the need to see through the necessary measures announced by the Government last week to deal with the difficulties arising from the present turbulence in the international financial situation. As I said, the tabling of this motion of no confidence has had its own negative and damaging effects on the financial markets, but a further contributory factor has to be the apprehension within those markets due to the fears of the prospects of a return to office of a profligate Government under a Fianna Fáil administration.

I am glad that in recent days in response to the statement issued by the Government last Thursday and to various statements made by members of the Government since that time, there has been a return to the purchase of Government gilts as evidenced by the purchase of some £120 million in gilts on Monday last and the purchase of a further £70 million in gilts on the Dublin market yesterday. I hope that trend continues and that stability will shortly replace sentiment in the marketplace, and that those who have been engaging, for whatever reason, in what was euphemistically described by a market spokesman as short-term juggling, will cease the juggling and return to sanity.

I have no hesitation in asking for the endorsement of the Dáil for what has been achieved by the Government. I would like to use the time available to outline very briefly some of the areas which have been dealt with in my area of responsibility, that is, the environment.

It is no exaggeration to say that the present Government have brought to the area of the environment and to the Department of the Environment, the most sustained and vigorous development of policy and services in the history of the State. Housing policies have been continuously reviewed and adjusted with the resultant transformation of the housing scene. Indeed, what was being called the housing crisis as recently as 1982 is no longer a problem, let alone a crisis. No later than this morning we read in the Irish Independent a report of a discussion by the housing committee of the largest local authority in the country, Dublin Corporation. It says:

There are now more local authority houses and flats vacant in the capital than there are tenants to fill them. And one of the main reasons for the dramatic turn-around is the phenomenal success of the Government's £5,000 incentive to tenants to buy into the private sector.

The housing waiting list in Dublin has been slashed from over 6,000 in 1982 to around 3,500 now. At the same time the number of Corporation dwellings lying vacant has gone up from 2,100 four years ago to 3,900 this year.

As a result the corporation's housing committee have decided to review their housing policy and to confine the main thrust, of their building programme to the building of houses in Dublin's inner city. This is proof positive of the success of the Government's housing measures in the public sector. In the private sector literally tens of thousands of householders are once again improving their homes and recently we took steps to improve prospects for the new house market.

Everyone who travels the country will be aware of the unprecedented scale of the works now being carried out to improve our major roads. Our roads plan, unlike previous plans, was backed up by hard cash. Great strides have also been made in the provision and improvement of public water and sewerage services. The most serious deficiencies have been eliminated. The most far-reaching reforms of our local government system under any Irish Government have been formulated and are in the process of being implemented.

Recognising the importance of the environment to the quality of life and to the tourism industry, we have taken a series of steps to protect and enhance our natural environment. There have been major initiatives in relation to the travelling people, urban revitalisation and the development of public amenities and parks. Unfortunately, in the time available, I will have an opportunity only to refer to some of the programmes and initiatives.

The national roads programme is an area where the Opposition cannot gainsay the remarkable advances made by the Government through better planning and vastly increased funding. We published the 1985 road plan which contained the financial commitments for road works. We invited the private sector to participate in the road programme through toll road projects. We set out our plans in relation to improved methods of cost control and economic evaluation of road projects. Regulations were made for improved vehicle safety. The road plan set out a detailed programme of works for the period 1985-87 and a tentative programme for the period from 1988 to the mid-nineties.

The Opposition, in fairness, when in Government also published a road plan but the test of the worth of any plan is the availability of the funds necessary to achieve its objectives. That is where the two plans differ. In the first year of the 1979 road plan, the Fianna Fáil Government saw fit to provide only two thirds of the funds which they had promised in the first year of their plan. By the end of the second year the figure had reached 73 per cent. On the other hand, in the first two years of our road plan, last year and this year, 99 per cent of the funds promised have been provided. Given that inflation is now lower than was assumed when the plan was prepared, total funding is, in real terms, somewhat greater than that provided for in the plan, which envisaged the spending £500 million over the three years of its lifetime towards carrying out improvements on the national primary and secondary road structures which are vitally necessary in order to reduce costs to industry and business. It would also move exporting firms more rapidly to the ports of exit. Up to recently heavy traffic in Ireland moved on average at the rate of 25 mph whereas their continental counterparts moved at an average of 45 mph. Obviously, the diseconomies for our exporting industries and business generally are considerable in a situation like that and it was for that reason that this ambitious road plan was formulated and is being implemented. It is far in excess of anything provided by a previous Government.

The allocation for this year alone is 65 per cent greater in real terms than the average for the years 1979-82. The availability of funds on that scale has given a major boost to the development of the road network and road building is evident all over the country. As recently as the last day of last month, I announced that over the next six months seven further major projects are expected to get under way at various locations, at the Navan Road, Dublin, the new road linking the Tallaght by pass to the Lucan road, the Bray-Shankill by pass, the Newbridge by pass, Glenmore, Corless, County Monaghan and an inner relief road and bridge in Sligo. Those schemes involve an investment of £135 million and 85 per cent of the work involved will be done by contractors.

I also announced my decision to have four major schemes carried out on a design and construct basis, a new method never tried in relation to the roads in this country. It is a system which I am satisfied has the potential to bring schemes on stream faster and get more competitive rates. The four schemes involved are the Dunleer and Mullingar bypasses, the Malahide road improvements scheme and phases 3 and 4 of the Dundalk inner relief road, comprising a much needed second bridge in Dundalk in connection with the M1 north of the town. The local authorities in those cases will shortly be inviting submissions from interested parties in relation to the Dunleer and Mullingar schemes and submissions will be invited for the remaining two schemes when land acquisition has been completed.

I also announced sanction for planning for the construction of the Dundrum bus lane. What was the reaction of the Opposition to those definite, much needed and long overdue road programmes and progects? They whinged about them. As well as providing funds for improvement works and major roads, we also provided funds to local authorities by way of block grants to supplement their own resources for the improvement and maintenance of regional roads, including county roads. This year we provided £20 million under the block grants system, an increase of 21 per cent on last year.

The problem of the deterioration on county roads is one about which I have been concerned for some time. In July this year I announced a new £15 million grant for strengthening works on county roads, £5 million to be paid this year and £10 million next year. My Department are now also paying 75 per cent of the cost of improvement works on more important bridges on county roads. Deputies on the other side of the House are among those who consistently called for Government aid towards the problem of county roads but, when I took the important initiative which I just outlined, they did not even have the grace to welcome it. Their reaction was what I expected, they cavilled and complained. I should like to remind those Deputies that it was the decimation of local finances under the administration of their party which contributed more than anything to the neglect and the difficulties which some local authorities now have in relation to their county road network.

The severe rainstorms of last August caused serious damage to roads and bridges in some counties. Our reaction was immediate and positive. We announced our intention to provide £6.5 million for repair and construction work in those areas. I expect £3 million of that to be spent this year and the remainder in the early part of next year. The road plan made it quite clear that the Government would welcome private sector investment in the road improvement programme. One such proposal involving an investment in the region of £25 million in relation to the stretch of the Dublin ring road from Lucan to the Navan road has already been accepted in principle by the Government. We have indicated also that we are prepared to consider funding on a joint public-private basis where projected traffic volumes are insufficient to justify a fully funded private sector scheme.

I recently asked local authorities also to investigate, in co-operation with local financial and development interests, the possibility of obtaining private sector investment for smaller road improvement projects using tolls to remunerate the private funding. That investment could be used to implement projects for which finance might not otherwise be available. The Government have literally transformed the housing scene through a series of well timed initiatives. I invite the House to remember what has been done already. During this year there will be 11,000 to 12,000 tenancy lettings by the local authorities and the annual target figure aimed at to adequately meet needs is 9,000. There has been a complete restructuring of the publicly funded house purchase loan scheme. There have been substantial increases in the loan and income limits for those schemes. A system of automatic mortgage protection insurance has been introduced on local authority loans. Today I moved the order for Second Stage in relation to streamlining building societies and to cutting the costs for borrowers.

We have introduced a new and better sales scheme for local authority houses. There has been a huge upsurge in house improvement activity and in recent weeks we announced a big boost for legitimate new house building by way of the new grant of £2,250 in respect of each new house built. The position of people depending on local authority housing is better now than it has been for decades. This is the direct result of good policy decisions taken by the Government. In the years 1982-85 we achieved a 25 per cent reduction in the numbers on local authority housing waiting lists. There will be further reductions this year.

I already cited the example quoted in this morning's newspaper in relation to Dublin Corporation. In that case the average waiting period for a house has been reduced from over three years in 1982 to under a year now. Indeed almost all the families on the waiting list in Dublin have already been offered accommodation, sometimes in two or three different locations, but they are now choosing to wait for a more suitable dwelling in another location to become available. A number of factors, all initiated by the Government, have contributed to that success.

There has been a high level of completions of houses in recent years, 7,000 in 1984, 6,500 in 1985 and there are 5,500 projected for this year. The success of the £5,000 surrender grant for tenants is dramatically increasing the number of existing houses becoming available for reletting. There is increased accessibility of home ownership to low income families due to the introduction of the Housing Finance Agency by the Government and the changes in SDA type schemes. Over 7,500 applications for the £5,000 grant have been received. As a result, so far 4,500 dwellings have become available for reletting. The scheme, in turn, has boosted house building in that almost half the grants paid to date went to people purchasing new houses. I ask the House to contrast our record with that of Fianna Fáil in this area. Their record was characterised by lengthening waiting lists and by increasing costs and expenditure because of the lack of a policy, planning and downright waste over the years.

Since 1985 capital funds subsidisable at up to 80 per cent have also been made available to local authorities to carry out remedial works on certain of their dwellings. Part of the local authority housing stock is poor. Part of it is old and requires refurbishment. Unfortunately, most of the schemes which required attention under the remedial programme introduced by this Government were schemes built in the period 1969-71 when the Fianna Fáil administration introduced what was euphemistically called the low cost housing programme which resulted in the provision of substandard houses and in which unfortunate tenants have been expected to live for the last 12 to 15 years. Once again, it has fallen to this Government to pick up the tab and introduce a major scheme of remedial works to remedy the mistaken and extraordinary costly policy engaged in by that administration during those three years. The so-called low cost housing schemes have turned out to be very expensive indeed.

Home ownership has always been espoused by various Governments in this country. It is clearly the form of tenure which is aspired to by the vast majority of the people. I have no hesitation in saying that no Government has done more than we have to further that aspiration. The list of incentives to home ownership now include the £2,000 first time buyers grant, the £2,250 new house grant, a comprehensive range of publicly funded house loans and site subsidies for joint ventures for private housing on local authority land. I have been determined to ensure that those schemes are continually reviewed and improved to ensure their maximum effectiveness.

In July of this year we conducted an entire review of the role of the Housing Finance Agency. We gave to local authorities direct responsibility for the operation of the scheme. There are now three repayment options being offered to persons of modest income — a conventional annuity system, an income-related repayment option similar to the HFA scheme and a new convertible repayments option offering income-related repayments for the first five years convertible to annuities thereafter. Those changes followed closely on the £5,000 increase in the maximum loan limits under the SDA scheme and the increase to £10,000 in the income limit under the scheme. Consequently, there are now a range of publicly funded house purchase schemes offering loans of up to £25,000 or £27,000 as the case may be and a range of repayment options. I am satisfied that that well balanced set of options will bring home ownership within the reach of many families on low or modest incomes who might otherwise have to be housed by the local authorities.

The success of the housing policies has facilitated the gradual redeployment of resources away from building new local authority houses to house improvement incentives to the grant scheme. That shift of resources gives a far better rate of return in terms of building activity and employment. The new house improvement grant scheme has vastly exceeded all expectations. So far, there have been some 115,000 applications, of which 80,000 have been approved. We are now receiving applications for final inspection and payment at the rate of 1,200 a week and 1,800 new applications each week. This means that so far one house in five of all those eligible to apply under the terms of the scheme have already made applications to carry out house improvements. There has been no scheme as generous ever introduced towards the refurbishment and improvement of the existing housing stock in the history of the State and no scheme responded to more positively.

What has been the reaction of the Opposition? They whinged about it. Well they might, because the only time since 1924 when there has been no scheme in operation for house improvement was in 1980 when the Fianna Fáil administration abolished the limited house improvement grant scheme which was then in operation. There have been a variety of incentives and new measures and a shift in policy options designed to get the maximum possible benefit from Exchequer moneys and to encourage a concept of home ownership to ensure that people are adequately housed and that our road system adequately responds to the needs of industry. In the area of sanitary services there has been an investment in the last three years of £350 million on the provision of new water and sewerage schemes which in turn generate the opportunity for new investment in shops, houses, industry, towns and villages. In the area of urban renewal I have taken some important steps. The Minister of State has introduced tax and other incentives for developers to regenerate life and activity in the five main cities of the country. The Minister of State, Deputy O'Brien, also introduced legislation with regard to the new Custom House Dock Authority. Yesterday, I received the agreement of the Seanad for the introduction of the Dublin Metropolitan Streets Commission which I will be inviting the House to discuss next week.

All in all, there has never been a period of more sustained or vigorous activity in the area of the environment than there has been in the four years to date of this Government but much more remains to be done. There is a heavy programme of legislation already published and in the pipeline in relation to the improvement of our infrastructure and our environment and in relation to environmental protection. I intend to see those further Bills published. I intend to introduce them and see that legislation put successfully in place for the benefit of the economy and the people. I intend to do that when the Opposition remove the irrelevancies such as we are discussing today and allow the House to return to what it is intended to do — to discuss and implement legislation for the benefit of the economy and our people.

Mr. R. Burke

The Minister started his contribution by describing this debate as an irrelevancy and wrapped up the same way. He talked about it as being a waste of Dáil time. That is rich coming from a Government who adjourned this House for the summer recess at the beginning of July and decided not to bring it back until 22 October. This is despite the fact that this is the Government who in their Programme for Government stated that they were going to bring the Dáil back every September when we would have the opportunity of discussing the Estimates in advance of the budget. Lectures on responsibility coming from Ministers of the Government are rich when one considers that it was this Government who through their irresponsible management of the affairs of this country have produced a current budget deficit of approximately £1.5 billion which is the highest in money terms in the history of the State. The Minister talked about a motion of no confidence as being a waste of time and a political game when we have gone right through the summer recess with one Government backbench Deputy after another calling for the removal of the Government and a change in policy direction. Opinion polls published last Sunday show that 73 per cent of the people are dissatisfied with the performance of the Government. That is not a once-off figure. It reflects a trend. If one goes back to August of last year one will find that 65 per cent of the people were dissatisfied with the performance of the Government. Therefore, there is a cry from the nation for a general election. Yet, we have a Minister stating that this motion is a waste of time. Where have the Government been since last July when this House could have been sitting to take the major legislation the Minister talked about?

For nearly four years, the people of Ireland have been smothered by the worst Government in the history of the State. They have suppressed all confidence. The Coalition have lost their moral authority to govern and their continuation is only at the expense of bringing public life itself into disrepute, by denying the people of Donegal the right to representation simply because it is "convenient" for the Coalition to do so.

A very depressing memory is that the Government caused the general election of 1982 by using the death of my late colleague, Dr. Loughnane, in a vote of confidence in the House to give them the voting strength. The Coalition came to power on the death of Dr. Loughnane and they are staying in power by the death of my colleague, Cathal Coughlan.

Governments should not be based on convenience. We look to them to lead, not to divide and depress. We look to them to be direct, whether reporting on Government projects or on the changes of conduct of the Cabinet. Governments must bring the people with them and, above all, develop the people's sense of participation and pride in public affairs. This was never more urgent than it is now.

The reality is that the Coalition have failed on all these levels. Put in the words of this motion, the people have lost confidence in this Taoiseach and Government. They have lost confidence in their ability to lead and they express this by emigrating or by standing back from participation in Irish life. When the Taoiseach talks of alienation, let him first look into his own back yard, because the Coalition are creating a crisis of confidence that is affecting the very status of Government and, therefore, our ability as a nation to get this country moving again. In addition, when the Taoiseach criticises the comments of his backbenchers as unhelpful to the country, he might with greater honesty ask why they are being made in the first place.

The answer lies in the Coalition's own dismal record. Between November 1982 and August 1986, unemployment has risen from 169,000 to 238,000 an increase of 40 per cent. This rate is the fastest growing in the EC, and in itself is also an indictment of the Coalition to meet their stated targets of what can now only be called building on unreality. It is an indictment of a Coalition that have neither plan nor policy and who change their targets as occasion fits. How can such a Government attract confidence?

Of course, the unemployment figures are only part of the story, as the genius and heritage of Seán Lemass, and his generation has to be put aside in enforced emigration to England, America and other foreign countries. Is it a gesture of confidence when over the past three years over 100,000 of our people have emigrated, 31,000 alone in the year ending April 1986? Earlier this year, when Fianna Fáil suggested these figures in the House, we were told by the Taoiseach and his Minister of State that our figures were wildly inaccurate, but we took the trouble to consult with people on the ground and to listen to the officers of emigrant support groups in Britain and America. In saying that the census figures proved our estimates to be correct, I only again want to make the point that so long as the Coalition continue to divorce themselves from the people on the ground, from their problems and their very real plight under the policies of this Coalition they will never get this country going again.

To do this, we also need the support of investors. However, the development of a second black hole brought about by the imposition of deposit interest retention tax, through which £1,500 million has left the country shows how uneasy investors are about the way in which the Irish economy is being mismanaged. Moreover, while they discourage native investment, the Coalition have accumulated a debt that is greater than that of all previous Fianna Fáil Governments in the history of this State. Indeed the deficit overrun of £180 million announced two weeks ago not only shows the Coalition's inability to work within their own stated limits. A further overrun of £180 million which will bring the current budget deficit for this year to £1,600 million approximately which will be the largest in percentage terms and money terms in the history of the State is in itself an understatement of the real scale of the Government's financial mismanagement.

To illustrate the point let me give details of what the position is in relation to the house improvement grant scheme, something the Minister made great play of. The figures the Minister quoted this morning were slightly different from those he used on Saturday. Yesterday the Taoiseach said, about the house improvement grant scheme:

With 115,000 applications now received the total volume of construction activity that will have been generated by this number of applications is conservatively estimated at £350 million, of which about £200 million will fall within the next calendar year.

The Minister for the Environment last Saturday informed us that his Department have received 117,000 applications for this grant, that to date 80,000 have been approved and that the applications are coming in at a rate in excess of 1,500 per week. Given the average amount, paid out per grant being £2,000, as confirmed by the Department, and that the average period between application and payment is between six and nine months, in this year's Estimates this Government have provided only £24 million for the payment of these grants. I should like to put forward a basic simple sum and ask the Minister to please indicate where this money is to be provided from.

The Department received 117,000 which, on the Department's figure of £2,000 each, will cost £234 million but the amount provided in the Estimate this year is £24 million, showing a shortfall of £210 million. That illustrates why there has been a delay in the inspections and payment of moneys for this year. How can the Government hide from this in 1987 because 80,000 applications have been approved? I understand that the average time from application to payment is between six and nine months and on that basis I wonder how the Government can hide from this matter in 1987. I challenge some Minister to say today that the 1987 Estimates will include a figure adequate to pay the grants in 1987 and without delaying payment of them into 1988.

The same is true in relation to the Minister's recent statements on water, sewerage and roads which the 1986 Estimates will not cover. The Minister must explain these overruns and how he intends to make up the shortfall. A few moments ago the Minister made great play of the roads programme and the Taoiseach did something similar yesterday. However, what they said was false. They claimed that the roads programme had been retrieved from the waste paper basket when they took office but I should like to outline the facts. In 1981 we increased capital spending on roads in real terms by 45 per cent, from £35.5 million to £60 million. The Coalition, in their ill-fated budget of January 1982, proposed a zero real increase in roads spending. We increased that in March by £10 million giving a real increase of 10 per cent. In our capital programme published in November 1982 we allocated £100 million, or an increase in real terms of 13 per cent, for roads. The first action of the Coalition was to lop off £10 million leaving at the end of the year only a 4 per cent volume increase in spending. In 1984 there was a 1½ per cent real increase in roads spending and the only significant boost came in 1985 when the roads budget increased by £25 million or almost 18 per cent. However, this year there was a zero increase in roads spending, a cut of about £10 million in what was envisaged on Building on Reality.

The Taoiseach's claim about rescuing the roads programme from the dust bin is also contradicted by one of his Government's documents, the 1984 public capital programme which states:

State investment in roads in the five year period from 1980 will come to £358 million representing a fourfold nominal increase over the previous five year period 1975-79. This accelerated rate of investment has allowed substantial progress to be made in carrying through the Road Development Plan for the 80's, published in May 1979.

All these instances show that the Taoiseach's economic arguments are tendentious, based on distortions of economic fact and in many cases are sheer invention. Is the Taoiseach incapable of presenting the straight unvarnished truth when arguing about the economy?

The lack of confidence in the Coalition is pervasive. This is especially so in the construction industry which accounts for over 10 per cent of the country's labour force. The Coalition have actively discouraged this industry and all their window dressing cannot hide this fact. Latest figures show that unemployment within the construction industry stands at nearly 50,000, an increase of almost 100 per cent since 1981. The number of house completions has been falling continuously, down by over 25 per cent in the past three years and this despite the recent NESC assessment that 30,000 new homes per annum are needed. Moreover, the Construction Industry Federation recently reported that only 12 per cent of their registered house builders reported new house starts in the first two months of 1986.

Against this background, it is not surprising that an increasing percentage of firms that are being forced out of business are from the construction industry sector. In 1983, the figure was 13 per cent and recent indications are that this figure is increasing. The Coalition's response to this is to penalise the industry through VAT increases from a 3 per cent imposition in 1983 to 10 per cent in 1985. The public capital programme has been cut by 25 per cent. The industry has been excluded from the business investment scheme. Incentives, such as section 23, have been abolished. The mortgage subsidy has been reduced and PRSI and planning charges have been increased. The fact is that the rate of taxation on the construction industry is higher than on any other productive sector in the Irish economy. This despite the fact that over 40 per cent of the price paid for industrial or residential building returns to the State in one form or other.

In regard to the Minister's recent proposals in relation to housing grants, it is clear that first time buyers will be substantially much worse off. I appreciate the need to stimulate the construction industry but is it really necessary to encourage second time buyers at the expense of first time buyers and young married couples? Is it really necessary to undercut the value of the grant paid to first time buyers? In our view, it is not. Every encouragement should be given to encourage investment in the construction industry and to allow first time buyers and married couples the opportunity to own their own home.

Like a drowning man clutching at any straw the initial reaction of the construction industry to the Minister's recent announcement of changes in the grant structure was to welcome them. However, now that the full impact of the damage that the grant changes have brought about has been realised, the industry feels totally let down and are at this stage even more depressed about the situation of their industry than previously. The reality of the grant changes is that at a time when extra investment is required this Government will actually be taking money out of the building industry housing sector in the next 12 months.

Let me illustrate the point. We estimate that by abolishing the £3,000 mortgage subsidy, the Minister will in the next 12 months save approximately £3 million. By abolishing the right of individuals who traditionally build their own homes from eligibility for the £2,000 grant he will save approximately £2 million. Against this the cost of the £2,250 grant will be approximately £3.5 million. The three figures taken together show a reduction in Government investment in the house building sector over the next 12 months of £1.5 million and this at a time when the industry is on its knees.

It is interesting that on the day after the Minister announced the changes I gave these figures in a statement and challenged the Minister to say if they were wrong. Of course there was no response. The figures are accurate. This Government will take £1.5 million out of the house building sector in the next 12 months.

In our view the construction industry cannot be revived through such negative policies. Our housing stock will continue to dwindle if the present policies of the Coalition are pursued, just as our county road network has been crumbling over the past four years. County roads account for 80 per cent of Ireland's total mileage. Here we have an investment which has been built up over the past 60 years being squandered by the Coalition with the result that driving on county roads is now like driving on an obstacle course between potholes. Motorists pay high taxes for a good road surface. They are entitled to a good road surface and to an assurance that what is there at present should not be allowed run down.

Recently the annual conference of the Institute of Engineers was told that 32 per cent of the regional road system was critically deficient and that the surface dressing cycle on regional roads had gone from an ideal seven years to 17 years while on county roads it had quadrupled from ten to 40 years. The conference was told that the failure of the Government to keep the block grant to local authorities hastened the decline of the road network.

These are the observations of the professionals on the ground and they reflect a lack of confidence in the ability of this Government to manage. It is natural for any person to react in an negative way when not only is their work discouraged but their existing achievement is whittled away as well. This is the lack of confidence we talk about. That is why I say that this Government have lost their moral authority to lead.

A further example of the dishonesty of this Government can be seen in their recent decision to renege on successive Governments' undertakings to the National Association of Tenants Organisations as to their right to negotiate on behalf of local authority tenants and the decision to give power to city and county managers to increase local authority rents and to try to cloak this in the mantle of devolution of powers. Such deception fools nobody as can be seen from the reaction of tenants countrywide.

The first point that has to be emphasised about the decision is that it is not a devolution of powers to local authorities but a transfer of functions to city and county managers. Local authority members have no say in deciding on the rents to be charged to tenants. The Government have decided that it should be exclusively a matter for the city and county managers.

Until 1973 rent schemes were prepared by local authorities and submitted for approval to the Minister for Local Government. Following the prolonged rent strike through 1972 an undertaking was given by the Coalition in 1973 that NATO would be recognised as the negotiating body for local authority tenants and tenant purchasers and that there would be a centrally devised scheme of local authority rents negotiated and implemented. Successive Fianna Fáil and Coalition Governments reconfirmed the position of NATO. The present Minister for the Environment in June 1981 when he was spokesman on the Environment for Fine Gael and prior to the 1981 general election, confirmed by letter that Fine Gael would continue to recognise the national negotiation position of NATO but like so many other commitments this has now been casually and cynically reneged upon.

The last scheme of local authority rents expired in 1984 and since that time up until recently there was no purchase scheme or revised rents scheme. This did not mean that tenants were not paying higher rents as the existing scheme was operating and tenants were paying according to their means. It is known that the Government around July-August 1984 made a decision to revise the scheme which would include overtime, shift allowances and bonuses which were not previously included for assessment purposes. This became public knowledge and following discussion in the Dáil the Government changed their position slightly around December. They entered into negotiations with NATO in January 1985. NATO rejected the Government's proposals and contact was broken. Of course, it is interesting to remember that after January 1985 we were in the run-in to a local election which took place in June, 1985. No further action was taken by this Government and no indication to NATO was given of the change in the position — only a dishonest statement of the Government referring to devolution of powers was issued on 14 August.

This new rents situation is going to create major anomalies with some tenants paying higher rents than other tenants in similar circumstances in different areas. For example, you could have a situation of a corporation tenant in Tallaght paying a different rent from that of a county council tenant next door in the same estate. We condemn the decision of the Minister and the Government and call on them to resume negotiations with the National Association of Tenants' Organisations to agree a fair and reasonable rent review on a national basis. I commit Fianna Fáil here today that on our re-election to Government we will restore the national negotiation rights of the National Association of Tenant's Organisations. It is interesting to ask how the members of the Labour Party who claim to represent many of the tenants involved if they can support a Government who impose such unfair and uneven charges on the people.

At the outset, I mentioned this Coalition's cavalier attitude towards the democratic process in relation to the Donegal by-election. Recently, we had a similar example when the Minister saw fit to withhold Exchequer grants for road maintenance from democratically elected local authorities who had decided to abolish charges. The reality is that the charges are not only unacceptable in themselves but the decision to abolish them is in accordance with the Government's leave to each local authority to decide on the issue for themselves. In deciding to abolish charges, my own council, Dublin County Council, for example, are acting on their mandate from the people. The councils represent the people and it is an outrage for this Coalition Government to withhold the share of the road grant of £15 million to Dublin County Council simply because the Coalition do not approve of local democracy in action. They give you the power to decide whether you will impose charge; you exercise the power, remove the charges and then you are penalised by retrospective action on the part of the Minister.

During the course of the last year, the Coalition again showed their incompetence in dealing with the radioactive leakages from Sellafield, making the Irish sea the most radioactive in the world. To date, the Coalition have allowed themselves to be fobbed off by both British Nuclear Fuels and the British Government. The issue is too serious to accept such a cavalier attitude, especially as the leaks will continue and as they do so, pollute the Irish sea and increase the risk of illness, especially cancer. Following the Chernobyl disaster, the International Atomic Energy Agency concluded that over 5,000 people were likely to die prematurely from radiation-induced cancer following Chernobyl. In other words, while the threat of a real disaster is always there, leakages are themselves, in the long run, just as threatening. The only reality is that Sellafield must be closed and in not pushing the British Government to do so, the Coalition have forfeited the confidence of the Irish people.

It is not sufficient for Government Ministers to say in this House that if they asked the British Government, they would not do it anyway. That sort of sleeveen approach is not what one would expect from an Irish Government. It is, time to ask our Government to get off their knees in their dealings with the British Government and the British authorities. They have an opportunity on this single issue to unite all the Irish people both inside and outside this House who unanimously want Sellafield and the other nuclear power stations on the west coast of Britain to be closed down. Because of being afraid in some way to rock the boat in their dealings with the British Government, they are afraid to make the demands on that Government. That is not sufficient and the Irish people will pass judgment on the Government at the first opportunity on that particular issue alone.

In the whole area of environment there is also the decision of the Minister to discontinue the operation of the combined purchasing system for commodities for local authorities and health boards. This scheme works to the benefit of Irish manufacturers who can secure a position on that list, thereby gaining an advantage for all our local authority and health board purchases. It is only right and proper that we should use whatever devices we can as a Government and a nation to help our own native industries. However, this Government, in an attempt to save £134 million, decide that as and from 1 January next the combined purchasing list system is to be abolished. They dress it up saying:

The above mentioned decision, which is also in line with the Government's general policy of devolving as much freedom of action as possible to local authorities by removing unnecessary central controls...

It is absolutely essential that, rather than eliminating incentives to local authorities, health boards, semi-State bodies and State Departments to purchase Irish goods, we should be strengthening and encouraging this. It will be a major element of Fianna Fáil policy on return to Government to ensure that State purchasing will, as far as possible, be directed towards the development of Irish industry and geared towards that. Why should we, in our construction and purchasing programmes, set out standards for products which are manufactured not in Ireland but abroad? Why should we not do the logical thing and devise our standards in such a way that they fit into the manufacturing capacity of Irish industry and thereby maintain and create jobs in that industry?

The whole position of schooling in my constituency is appalling. Recently, at the County Dublin Education Committee the following resolution was passed to which I would ask the Minister for Education to respond — that the committee, of which at that time I was chairman, condemned the delay in sanctioning the start of building work on Donabate national school, St. Andrew's national school, Naomh Mearnóg national school, Portmarnock, Garristown, Corduff and Castleknock national schools. It called for the primary schools projects in River Valley, Loughshinney, Ballyboughal, Naul and Kilcock to be immediately allowed to go to tender and called also for an immediate meeting with the Minister.

In the course of this contribution to this debate I think I have clearly illustrated some major reasons for this Government not deserving the support and confidence of this House. Taken together with the speeches of my colleagues we have made an unanswerable case as to why the Government should go to the country.

Minister for Foreign Affairs (Mr. P. Barry)

I fail to understand what the Opposition party have been doing for the past few days. If the vote tonight were to go as they wish, there would be a general election. In those circumstances, the performance of the Government and the policies of the Opposition would be put under a microscope and very carefully examined. I have not heard all the speeches in this debate, but those I have heard from Members of the Opposition in the last 24 hours would lead me to believe that no electorate anywhere in the world could have any confidence in replacing this Government by what is being offered on the far side of the House.

Even the very ordering of their own business does not appear to warrant any confidence in their ability to do anything about the country's business. For the last six to eight months they have been holding conventions all over the country where there are no vacancies because no election has been called. Yet, in the very place where there is a vacancy, Donegal South-West, they did not hold a convention but have come into this House and asked Parliament to approve a writ for the by-election. Surely If they were serious about holding a by-election in Donegal South-West they would have held a convention there, instead of one of the other places. These are just not serious people. They are not serious now and when previously in Government were not serious either. Their only concern in politics is a presentation of a series of yesses to the electorate. In any part of the country, you can take it that a Fianna Fáil Deputy, when approached by any kind of pressure group for any kind of a project——

Mr. R. Burke

A hospital here or a hospital there.

Mr. P. Barry

——unassessed, uncosted, will say yes. There have been endless examples this year already of the number of things they have promised. They are the party who are now asking us to believe that they would cut public expenditure and taxation. The figures are published and verified. No responsible Opposition should come into this House or issue statements to the paper saying that they can cut public expenditure and taxation without pointing out precisely the areas in which they are going to cut that public expenditure.

Instead of cutting public expenditure the party opposite have made promises of expenditure over £800 million in one year. They promised a new Irish merchant shipping fleet which would cost £30 million. They promised VAT refunds to farmers which would cost £140 million. They promised VAT relief for the building industry, for which industry Deputy Burke wept such copious tears, which would cost £54 million. Their promises to various health schemes and projects would cost £300 million. They promised the abolition of the deposit interest retention tax which could cost £75 million. When Fianna Fáil speakers stand up in this House and weep for the construction industry it is just a knee jerk reaction. Fianna Fáil gave no positive or imaginative proposals as to what they would do for the construction industry. They say that they will give £200 million in order to revive that industry without saying what they will give it for. Will they build office blocks or factories, although there seems to be an adequate number of those in the country? I do not believe, as the Taoiseach pointed out yesterday, that they will get a better result in the housing sector than we have got with our reconstruction proposals and the change in the method of applying grants for new houses.

The Taoiseach adequately demonstrated yesterday that the road programme under this Government is exactly what the country can afford. The programme has been moving forward according to plan over the last four years yet Fianna Fáil say that they will give a further £200 million to the construction industry. That would have precisely the same effect as all their other initiatives to the construction industry have had over the past 25 years. They over-heated the industry. They pushed up prices and inflation. Their response is unthinking and the same thing will happen in the future.

Fianna Fáil promised earlier in the year that they would pay the balance of the teachers' demands which would amount to £80 million. That should not be forgotten when these people talk about public sector pay and cutting public expenditure. This year alone their promises amount to £880 million. There is another two months to go to Christmas and I do not know what kind of goodies they will promise by then. Yet this is the party who try to persuade the public to have confidence in them. Obviously putting down a motion of no confidence in this Government means that the public should have confidence in them. They tell the public through Dáil Éireann that they should have confidence in them. Knowing the budgetary position as they do, and despite all the promises on television and radio by Deputy O'Kennedy, Deputy Brennan and the Fianna Fáil leader, Deputy Haughey, that public expenditure and taxation will be cut they promise a further £880 million this year and that only accounts for the official promises this year. It does not take into account the promises in 1983, 1984 and 1985, nor does it take account of what they will promise between now and Christmas. One can imagine what will happen when an election is called next year. Anybody who wants a new pair of gloves will be promised them.

Mr. R. Burke

A hospital here and a hospital there.

Mr. P. Barry

There will be no end to the amount of money they will spend. I warn them now there will be no lessening of the spotlight we will put on every one of their promises. They will be made to say where they will get the money to pay for all these promises.

Mr. R. Burke

Does the Minister think they will be able to let the Taoiseach out during the campaign?

Mr. P. Barry

There are only two sources from where the money will come. It will be either from increased taxation or increased borrowing. Even though Fianna Fáil talk about cutting public expenditure, because of their record and their promises in this regard we must presume they do not intend doing that. It is only window dressing. Deputy Burke referred to the level of public indebtedness. They cannot fool the public because they know that the level of borrowing is already too high as a direct result of their last and second last terms in office. The real problem is not just what they land on future Governments. It is what they have landed on future generations, the responsibility of repaying this debt which they have run up. After a great struggle, we have managed to restore the confidence in the country. We did not allow the debt to run to unmanageable levels. If Fianna Fáil get back into office and if they intend borrowing on the scale which they now indicate, our creditworthiness will be very seriously damaged. Whether they intend borrowing or not there will be increased taxation. Evidently they do not intend to cut public expenditure despite what their economic spokesman has said. We must presume then that they intend to increase taxation. Yet they complain about the level of taxation and put down a motion of no confidence implying that the public should have confidence in them. I do not think the public will be that easily fooled.

Side-by-side with all those promises they say that they will lower taxation. One of the promises made by their leader is that two-thirds of the taxpayers will be on the standard rate of income tax when they get back to office. We will ensure, and I am sure the public will ensure, that when the election comes Fianna Fáil will explain quite clearly how it is possible to increase public expenditure and lower taxation without borrowing more money. That is just not possible but it is Fianna Fáil policy. The sad thing is that they will try to do two of those things because the leopard does not change its spots. They will try to increase public expenditure and they will lower taxation and they will do it by borrowing more money and getting us back in the same cycle in which they put us between 1977 and 1981. That is certainly not what this country wants or needs in the very difficult times it will have to face. The politicians do not matter, they come and go and Governments go, but all this is being done at the expenses of the people and that is why it is unfair.

I omitted to mention that besides the promises being made nationally, Fianna Fáil Deputies all over the country will make promises about any kind of thing, a flower pot outside a window, a new gate or anything at all, at the moment. Witness Deputy Haughey a fortnight ago and last week Deputy Flynn in Mayo. Nothing is impossible. You never say "no"; you just keep on borrowing and overspending and we have the situation we had in 1977-81.

We have managed in our term in office in the last four years to bring about real reductions in the level of taxation because we shifted the total burden of taxation. It has been stabilised and the weight of personal taxation has been shifted away from the PAYE sector. This year's budget alone countains reliefs costing £120 million, and those measures were far more effective in putting money into people's pockets than if the tax bands had been merely index linked. Added to the reduction in taxation this year the reduction in inflation has been a very real benefit to everybody. This was not easily achieved and demanded great sacrifice and application to ensure that anything the Government did would not have the effect of pushing up the inflationary spiral. The rate of inflation has now dropped from 21 per cent, which it was when we came in in 1981, to 3.5 per cent this year and people will get the real benefit of the tax cuts introduced. Very important, it will keep our industrial costs in line with those of our competitors abroad. I am not sure if it is always realised when people use words like "keeping industrial costs in line with those of our competitors abroad" how important that is for jobs here. This is an open economy. Our trade with Britain alone, which has diminished sharply since we joined the EC, represented about £8,000 million every year in imports and exports. Therefore, unless we can compete by producing goods at a price that will allow us to sell to that economy we will not be able to retain jobs here. Equally, the goods we produce here must be produced at a price that is equal to that of goods produced in other economies or else they will be able to supply them here. Therefore, there will be a double effect there. Our goods will not be selling abroad and our goods that are selling at home will be replaced by imported goods. It has been noticeable over a number of years that since we got our competitive position into line with that of our other partners in the EC the amount of Irish produced goods on our supermarket shelves and in our shops has increased substantially though not to a level which we would like. Equally important, for the first time in over 40 years we are now exporting more than we imported in 1945 and 1946. In 1985 for the first time since 1944 this country sold more abroad than it imported. That performance is going to be repeated in 1986. That did not just happen, even though credit must be given to manufacturers whose market skills improved enormously. Credit must go to CTT who have identified and encouraged people to sell into markets, but credit must be given also to the fact that we are getting our costs into line with those of competing countries, both the UK which is still a very important market to us and other EC countries.

Reference has been made to a black hole and money disappearing out of the country. Deputy Burke referred to it and I heard Deputy O'Kennedy and Deputy Brennan give very irresponsible interviews on the radio in the last fortnight about money leaving the country through lack of confidence and through DIRT. That is absolute nonsense, when you think of the figure I have quoted of £8,000 million being the trade in sterling between the Irish and British economies. Many firms when doing their budgets early this year priced into their budgets an IR£1 valued at £0.82 sterling. Of course it pays them to pay their bills promptly now. Many would say that it is very good business to do that. If 45 per cent of our trade is in exports to Britain and if firms here who are normally getting their money back within 90 days decide to leave it in Britain for a further month, that has an effect on the outflow of funds. Likewise firms here who are buying — and that is about 55 per cent of our trade in imports with Britain in sterling — and who were normally taking 90 days credit are now paying promptly and that happens for only half the traders exporting. That is £500 million. That is the normal way trade is done and as long as that will correct itself when the £ sterling and the IR£ come back to the relationship they had 12 months ago, that is all right. Therefore, those who try to talk panic by talking about capital disappearing out of the country fail to understand what happens in trading relationships or are being deliberately mischievous. Likewise the contention that DIRT was responsible for capital leaving the country is demonstrably untrue. When we put our budget together at the beginning of this year we did it on the basis of an estimated deposit at that time in the banks here on which we would collect tax on the income paid. Our estimate of the level of those deposits we reckoned would give an income this year of £75 million. Obviously, if all this capital were supposed to have fled as a result of DIRT we would not have collected that £75 million. The proof of that is only coming out in these few days. The capital did not leave; we collected what we estimated we would collect in the budget. There is no doubt that some people did take out their capital but we collected this month precisely what we estimated last January we would collect. So the contention that capital was fleeing because of the deposit interest retention tax is clearly untrue. I hope that when those figures are published the people who have been spreading that story in the past few months will refrain from doing so in the future.

In regard to the lagging outflows of capital, they will correct themselves when the British pound comes back to the relationship it had with the IR£ a few months ago and that will happen if the British Government make a decision to join the EMS or if the price of oil increases, bringing up the price of the English pound with it.

I want to say something about the Single European Act and what it does not represent. I am saying this because of a letter sent to me by The Workers' Party complaining about a number of things they say are contained in the Single European Act but which are not contained in it. They talk about the removal of unanimity voting in certain areas in accordance with the Treaty of Rome. It must be remembered that increased recourse to majority voting is very much in our interest. For example, a decision was taken by the Minister for Agriculture last week on the green £ devaluation for Ireland. If majority voting had been an essential in taking that decision we would not have got our devaluation. It has also been said that the veto has been removed and that Ireland will no longer be able to defend her vital interests. That is absolutely untrue. This point has been deliberately misrepresented by some. The Luxembourg compromise or the so called veto remains unaffected by the Single European Act. The Government's view that a member state should remain free to invoke vital national interests in exceptional circumstances and with substantial justification is shared by the majority of the community and it remains in place. There are some who object to the attempts to complete the internal market by 1992. I cannot understand how anybody in this country which is export dependent could object to the completion of the internal market sooner than 1992, never mind by 1992, because it is very much in our interest that the internal market should work efficiently and be freely available to us because 69 per cent of our exports now go into the Community.

The gravest misrepresentation has been in the area of neutrality. The Single European Act contains absolutely no threat to Ireland's neutrality. Nothing in that Act goes further than the practice of political co-operation which we have been engaged in since we joined the Community. What is happening now goes no further than that but merely formalises it. The word "security' is used and used precisely in the Single European Act. Certain people have chosen to misinterpret that. It is used in the sense of political and economic co-operation which is very much in our interests. It is quite clearly not used in the sense of security in defence. The article in the Single European Act dealing with political and economic co-operation quite specifically says that if certain countries want to discuss security in the defence sense they must do it in NATO or in the Western European Union and Ireland is not a member of either of those. As decisions can only be arrived at by consensus we have the final say in any decisions — as have the other 11 countries — as to what positions are adopted in regard to political co-operation. The implications in the Single European Act have been either deliberately misunderstood or misrepresented by a number of people in the past months. They have the solemn assurance of this House that there is nothing in the Single European Act that is not clearly in conformity with our Constitution and with the decision taken in May 1972 by the vast majority of the people of Ireland that Ireland should become part of the EC.

There is one final thing I want to say about the North and about the Anglo-Irish Agreement. Last November when we debated the Anglo-Irish Agreement in this House Deputy Haughey said it had constitutional implications. I said to him at that stage that if he thought that he had an obligation to take it to the Supreme Court to be adjudicated on. This was repeated once or twice in the following few months by some of their speakers, though I must say clearly not by their spokesman for Foreign Affairs nor by Deputy Lenihan on television the other night nor by Deputy O'Kennedy with whom I shared a platform in Tipperary about a month ago. I thought that Fianna Fáil's concern about the constitutionality of the Anglo-Irish Agreement had been alleviated because of what Deputies O'Kennedy and Lenihan said and what Deputy Collins did not say. Therefore, I was very surprised last Sunday week when Deputy Haughey, in Bodenstown, again returned to this red herring that the Anglo-Irish Agreement is somehow out of line with our Constitution. I want to say very formally in this House that he is not helping Irish nationalists, North or South, by not pursuing this line in the Supreme Court if he has doubts about its constitutionality. I do not want this to be an election issue or a point of contention across the Floor of this House but if Fianna Fáil have doubts about the constitutionality of the Anglo-Irish Agreement they owe it to everybody in this country to have it adjudicated on in the courts. They should get this out of the way once and for all. They should either shut up about it or bring it to the Supreme Court. They should not leave it to fester in the back of their minds for another 12 months and then bring it out again.

Mr. O'Malley

Thank you for calling me in this debate. This country's economic affairs are now in such a parlous state that there is a widespread mood of anxiety and near despair gripping our people. The present Government have long ago reaped the whirlwind of their ideological paralysis. They stand helpless in the face of the rising economic crisis because the Fine Gail and Labour parties cannot agree on the necessary and essential solutions. This was graphically summed up in the public confession by the Minister for Finance last week that he was helpless to do anything about the rise in interest rates, although he went on to concede that interest rates could be reduced if the Government reduced their borrowing and adopted what he termed a responsible budgetary policy. How right he was, but I think I am entitled to ask why is the physician so reluctant to take his own medicine.

That was followed by a Fine Gael Ard-Fheis which would lead anyone looking at it on television to believe that Fine Gael were an opposition party and had no responsibility for the manner in which the affairs of the country have been administered over the past four years. One has to feel sorry for the Irish people when one sees what is served up to them as allegedly serious political endeavour. The Government's inability to govern and to begin getting their affairs in order is graphically underlined by their meek surrender to various interest groups right down to assorted publicity seekers on their own backbenches. It is a disgrace that at a time when the country is beset by so many social and economic problems so much of this Government's time is taken up by mollifying a few selfish publicity seeking Deputies in their own parties.

We as a new party with five Deputies could have indulged from the summer on in the same antics as we have seen from some Government backbenches. We could have adopted a "will they, won't they" approach and created a feeling of cynicism to accentuate what was there already. We could have sought to do deals of various kinds with the Government or otherwise, but we declined to do that. I believe the feeling of revulsion that people have at what has been going on of late will stand to our credit when it is recognised that we refused to take this kind of opportunity to generate that kind of false publicity for ourselves which would not have done the country one bit of good.

I am glad Deputy Cluskey has joined us because I want to say something about the Dublin Gas Company affair about which we have heard so much in recent months. We now learn it is the intention of the Government to nationalise or to take over this company. We are informed by Deputy Cluskey and others that the cost of this Government's involvement in the company so far is likely to come to about £120 million. This House should remind itself that two years ago this company was quoted on the stock exchange at a total value of £1 million. If the Government wanted to buy this company why did they not buy it for £1 million and stop all the nonsense we have seen over the last number of years, and in particular over the last few months? That company was, and is, a private company but look at the way the management and employees have been looked after — one of them, we are informed, to the extent of £600,000 for nine years' service. These are employees of a private company, a company that was on the hazard of the marketplace. I do not deny them their right to proper consideration but I cannot help contrasting the consideration that was given to that company, its management and employees with the consideration given to the employees of Irish Shipping, a company 100 per cent owned by the State.

Many of the employees of Irish Shipping had 40 years service in every part of the world, working on behalf of this country. Many of those who were cast aside and thrown £800 or £900 and told they would have to be satisfied with that, were men who risked their lives among torpedoes and bombs during the Second World War in order that this country might remain alive, and who saw several dozens of their colleagues die around them in that effort. Those people are cast aside and their only voice is outside the gates of this House while on the other hand, the management and employees of a private company are looked after in a way, to put it mildly, that is in stark contrast. I wonder where the sense of priority of those with refined consciences on these matters is, because it seems to me to be remarkably misplaced at times.

In connection with the performance of backbenchers allegedly seeking to get particular deals, but primarily seeking to get themselves re-elected in the coming general election, the public should be warned today that this Government are in danger, as one of their final acts of folly, of signing for the creation of another enterprise that may have the most horrendous financial consequences for the taxpayer. As a State we are engaged, unfortunately, in many loss-making operations but they are in place and it is sometimes difficult to do as much about them as one might wish, but this is different. I am speaking about the Canadian deal for the centre of Dublin and on which the vote of at least one Member of this House hinges. This is one project we know something about in advance. The documentation has not been published but there have been leaks and we have some idea of what is involved. Here we have a situation where, on a vote of confidence, a Deputy will decide the future or otherwise of the Government not by exercising his judgment as to whether they are a competent or incompetent Government, which is his duty, but by exercising that vote on the basis of whether a particular deal with foreign interests, of which he is in favour, goes through. That is a mark of the manner in which our public affairs are dealt with and I do not think it is satisfactory.

It appears that a proper description of this project if it were to go ahead would be the new black hole under the Liffey. It is ironic that its location should be close to the Halfpenny Bridge. This project is estimated to have a capital cost of £259 million and will require an ongoing subsidy of £30 million each year for the rail link proposed. Moreover, it will add considerably to the office stock in a city which is already littered with empty office blocks and not just thousands but it seems millions of square feet of empty space in, a country where the decentralisation of our Civil Service and other office space activities is very urgently needed. It will give us substantially more shopping space in a country where the volume of retail sales dropped by 10 per cent since 1980. What is the economic or social sense of such a proposal? Is it right that the Government of a sovereign country should be dependent on that? Is this the way we should properly conduct our public economic affairs? Is this not something that one might take for granted in certain countries in Central or South America?

The Taoiseach spoke last night on the Adjournment debate of his view of the activities of some health boards. He deplored their activities and said that they were trying to hype up things politically to make it difficult for the Government and so on. He also deplored their tendency to try to frighten vulnerable people in the community — staff, patients and potential patients in hospitals. I agree with him but I now invite him to cast his eye back to last Saturday's newspapers and to the RTE news bulletins of last Friday night when the Minister for Health, Deputy Barry Desmond, interviewed in Croom, County Limerick, after the opening of a new operating theatre did exactly the things which the Taoiseach deplored last night. The Minister described some cuts proposed by the Progressive Democrats in their policy document as intended to close down large sections of hospitals, to eliminate large numbers of beds and to make staff redundant. In every sense he tried to hype the matter up politically.

It is remarkable that the Taoiseach should properly find that behaviour unacceptable and improper when carried out by health boards but, at the same time, he apparently does nothing about it when exactly the same practice is indulged in and the same untruths told by the Minister for Health. I should like to take the opportunity to refer to an interview which the Minister for Health gave to a newspaper, Southside, last August. On page 11 he said:

We have fought to keep the budget deficit up to about 7.5% of GNP. The alternative to this is massive deflation and there is still an attempt by other parties to have it reduced to about 4% to 5%. We have had a four year battle to keep up the level of expenditure. I think that that has been our major achievement.

We are asked to vote confidence in that Government and in the Minister who said that, whose all consuming desire seems to be to pauperise the country and to ensure that bankruptcy comes sooner rather than later. Does anyone who has concern for this country feel that he or she is entitled to vote confidence in that?

Does our level of expenditure not matter at least to some members of the Government? How does the Minister for Health reconcile that with the statements of the Minister for Finance? Is it not clear, in so far as there is a contest between them — and clearly there is — that the Minister for Health is winning every round or, as the headline in the article to which I referred says "Battling Barry weighs in for the next round". He won the last four and it looks as if he will win the next one too. Indeed, the Minister for Health is entitled to a special award because of the fact that while it was his ambition to keep our deficit at 7.5 per cent of GNP, the figures now available tell us he will achieve somewhere between 8.5 per cent and 9 per cent of GNP in deficit this year. Perhaps the award could be in the form of the Bob Geldof golden spittoon, which would be appropriate.

Later on in the same article the Minister said that he challenged the Progressive Democrats and Fianna Fáil to say precisely where they will cut back on expenditure to finance the tax cuts. We have done it, there it is.

An Ceann Comhairle

Unfortunately, we cannot have exhibits.

Mr. O'Malley

We launched the document last week. It is well worth reading and is the answer to the Minister for Health or anyone else who wants to know where cuts can be achieved.

Unfortunately, we think only in terms of cuts, we do not think in terms of the losses we are suffering due to foolish activities which do not directly relate to public expenditure or supply services but which nevertheless have vast consequences for us. Among those was the decision to devalue the Irish pound on 2 August unilaterally and outside the context of the EMS. The cost of that is somewhere between £400 million and £500 million on our EMS borrowings alone apart from our other foreign and domestic borrowings.

The Progressive Democrats spent six painful weeks trying to achieve cuts of £250 million in public expenditure. We did it although it was not easy. What we did, with all the difficulties entailed, is only minor compared with the loss of nearly twice that amount of money at the stroke of a pen, simply by bad management. We are now in a position where, again by bad management and the failure to take an over-view of the position, the gilt market for the past six weeks up to yesterday had virtually broken down. There have been net sales out of gilts this year so far of £200 million although that market consists of gilts of a nominal value of £9.2 billion. The consequence of the bad handling is that the Government's interest rate has gone up from approximately 10 per cent to about 14 per cent in a matter of a few months and the cost to this country is astronomical.

These matters are never debated although that is where the real costs arise. it is due to faulty management and a lack of understanding of reality. We are unique in Europe in retaining in State ownership assets on which we get no return or a negative one. At the same time the Government are down in Anglesea Street borrowing money at a rate of 14 per cent. What kind of sense does that make? What kind of management is that? Nobody else would manage their affairs in this way, neither a company nor another country. Yet we sit here apparently paralysed in the belief that nothing can be done and that we must battle on. In the words of the Minister for Foreign Affairs to whom I listened, things will change in a year or two, they will get back to normal and we will be all right. They will not change. I do not have time to develop the reasons for things not changing. The Minister for Foreign Affairs and the Minister for Finance suggested yesterday that there was not an outflow of funds as a result of the DIRT tax and the financial resolution which went with it which allowed the Revenue Commissioners to disclose non-resident accounts to the British Revenue Commissioners. Economists have proved with Central Bank and other figures that £500 million has gone in the past six or seven months. In conclusion, I want to refer to a leading article in today's Irish Times where it is stated that it the Government survive today we will have nothing more than ping pong politics for the rest of the session with no attempt to get to the bottom of things. Several hundred years ago there was a man who commented on Irish Politicians operating in a way in which Fianna Fáil and Fine Gael operate today. That man was Jonathan Swift. It is a pity his savage indignation is not around today. He said:

"Where Whig and Tory fiercely fight, who's in the wrong, who is in the right; and when their country lies at stake, they only fight for fighting's sake".

Mr. Cluskey

I would like to make a few remarks during this debate. Everyone is probably expecting me to speak about the Gas Company issue. I will make some brief remarks on that affair but serious and important as I regard the Gas Company issue, there are aspects of it which are far more fundamental and important for the proper working of parliamentary democracy.

I will refer to three matters. First, there seems to be Some confusion with regard to the figure of £124 million but that is the figure the Gas Company deal will cost the taxpayer according to a letter I received from the Taoiseach. We are entitled to take that as the authentic loss to the taxpayer. I first became aware of this deal in January 1983. I became aware of it because a deal had been negotiated between the Fianna Fáil Government of that time and the Gas Company. There were some aspects, including the pricing mechanism, which affected the Department of which I had the privilege of being the political head at that time. A certain amount of documentation was available to me because of that. The point I am trying to make is that for nearly 12 months I battled within the Cabinet to stop that deal being made. I lost. I lost in late November or early December of that same year. The point I am making is that behind closed doors 15 people elected initially to this House by the people and then by this House to the Cabinet made a decision that £126 million of taxpayers' money was to be put into a private company and the fellow who was going to pay the bill did not know anything about it. That is not my concept of democracy.

The Gas Company has been debated, discussed and written about over a considerable period of time. Sometimes the issue hypes up, sometimes it goes away but what I do not know — and I am an elected Member of this House — is what other deals may have been made. I am not talking about any particular Government, I am talking about the principle involved. How many deals can be made behind closed doors which will cost the taxpayer literally hundreds of millions of pounds when not only do the people not know the details but this House that votes to expend this taxpayers money do not know? If I had not resigned from the Cabinet on the issue of Dublin Gas, because of the conventions that exist, I could not have opened my mouth about it. Even at this stage the people would not know because the reality is the silence of the official Opposition over the last two or three months. This has not been because they did not like to get in and take a little of the political action but because they had engaged in precisely the same thing. I am not making political points, I do not want to. The point I am making is that there is something fundamentally wrong about a system in which literally hundreds of millions of pounds of taxpayers' money can be put into private hands at the disposal of private individuals without this House knowing and, through this House, the people knowing. We need to look very seriously at that aspect of the affair. I am convinced that this kind of operation is not and has not been confined to Dublin Gas. It is an important issue.

Another important issue is accountability. I, as an elected Member of this House, sought legitimate information regarding taxpayers' money. I asked straightforward legitimate questions and it took me from when I first wrote to the Taoiseach on 29 July up to last Tuesday night to get the information I had sought. It is widely perceived by the general public that if the voting situation in this House was not as it is today I would have been told to get lost. It is a fundamental point with regard to our operation of parliamentary democracy, that every Deputy in this House has a responsibility to look at that aspect with a sense of urgency. Because they are an essential part of the democratic process there is a responsibility on the media to look closely into the situation also as it is a fundamental flaw in the operation of any democracy.

I did not intend, and I mean this, to refer during this debate to the Minister for Finance but it came into my mind yesterday that maybe I should and when I read a letter written by him and published in today's Irish Press my thoughts went from “maybe I should” to that of “I would.” My comments will be quite brief. The word “bunker” has now gone into our political vocabulary. So far as Dublin Gas are concerned, let no one forget that the Minister for Finance was the main champion, architect and pilot of this disastrous affair right through the 12 months I spoke about. If there is a bunker, a word that got into our political vocabulary in the last few weeks, the present Minister for Finance must be in the basement as far as Dublin Gas are concerned. I am prompted to say that because everybody knows the part he played in this.

Yesterday I watched the Minister for Energy as he answered questions tabled by Deputy Reynolds. At that time the Minister for Finance was sitting beside him but half-way through those questions the Minister for Finance folded his paper and walked out as if he did not know what Dublin Gas was about and did not know where it was. That was when I started to think that maybe I should refer to him. When I read the letter he wrote to The Irish Press I decided that I would say something involving him. About yesterday's episode, and his disappearing act over the last few months. I will simply say, the Tánaiste. Deputy Spring, is a quieter man than I am. Last April I said I thought the Minister should resign over this issue and I still believe that. Resignation on a matter such as this is a matter of personal honour. Nobody can impose that upon a person, it is something that person must decide for himself or herself. I know what I would do in those circumstances.

The other fundamental issue we should look at in this democracy of ours is the role played by the financial institutions not just in relation to Dublin Gas but their all-embracing role that touches almost every individual one way or another. We know from the information I got on Tuesday night that at least £17 million of the £50 million the banks are owed will be paid for at the rate of 16 per cent. Between this year and next year the banks will get just short of £14 million in interest rates alone out of Dublin Gas, out of the taxpayers. That will be paid despite the fact that the then Minister for Industry and Commerce in 1983 on national television assured the Irish people that the banks would have to take the normal commercial risk. If being assured of getting all one's capital back and within two years making £14 million, is a normal commercial risk, my definition is somewhat different from that of the present Minister for Finance. If that is his definition of what he frequently talks about, of venture capital, God protect the Irish people from it.

There is another aspect about the role of the financial institutions within our democracy. We saw the Minister for Finance in a different light when there was talk about hiking up bank and mortgage interest rates by 2 per cent with a threat of a further 2 per cent. He appeared on television last week and told the people of Ireland that money is like any other commodity and it must be subject to market forces. He said that he or the Government could do very little about it. The unfortunate thing about that statement is that he was telling the truth because there is very little they can do about it as a result of the way our system operates. The banks and the financial institutions are holding our whole society up to ransom.

I should like to look at another aspect of this. We are all wondering what will happen at 4.45 p.m. this afternoon. If one reads the newspapers, listens to chat in the corridors or listens to the speculation of some journalists, one gathers that the thinking is that if the vote goes with the Government this evening the next question is, will they survive the budget? Another question being asked is, will the budget discussion survive the Cabinet room? It is understandable that such questions are being discussed because we have been told that there is an overrun of £180 million which has caused a financial difficulty, a financial crisis. A Government, irrespective of the party or parties in power, would, according to some people, probably fall because of that while the most optimistic say that a Government would possibly fall because of it. As I understand it, the Government paid £1 for the privilege of taking on debts for Allied Irish Banks to the tune of £263 million, the last figure I heard mentioned. We, the Government, gave Allied Irish Banks £263 million, and possibly a lot more, of the taxpayers' money over one weekend. We know that private individuals in Dublin Gas were given £124 million. Members should think about that today. That could bring down a Government. If those two figures were not involved we would not have this terrible crisis or be speculating about the terrible cuts that may have to be imposed on the poor unfortunates of the country. We would not be sitting here thinking as I am of AIB. No one was even criticised for the financial buccaneering they engaged in. They just handed the bill to the taxpayer. They continued to pay their dividends and everything was rosy. Everything was grand except for those who had to pick up the tab. There is speculation about severe cuts in social welfare, health, education, local authorities and other services because there is a shortfall of £180 million. The Government are in a financial crisis.

Everyone knows my political view. I do not apologise for my political persuasion. I am proud of it. When we use the word "ideology" people seem to think that there is only ideology of the left but there is also ideology of the right and it is very much alive and active in Irish political life today. My ideology is of the left but leaving that aside, if a commission were set up and given the question "are the Irish banking institutions helping or impeding the recovery of the Irish economy" to answer, I believe after a close impartial examination of their activities was carried out, the answer would be that they are certainly not helping it. I believe they are impeding it. No Government, irrespective of their political persuasion, could stand back and allow that to continue.

If I had made that suggestion two or three years ago I would have heard howls of "Bolshevik", "do not mind him" and so on. However, there are many people who do not share my political philosophy or views and who never will but they share my concern about what role our financial institutions are playing in society. Many farmers are taking a more critical look at the activities of banks and financial institutions. Many business people, particularly small operators, are also taking a closer and more critical look at the activities of the financial institutions and whether they are helping or impeding our economic recovery. There are many householders who have committed themselves to repaying mortgages for 25 or 30 years who are trying to provide a proper home for their families.

I have repeatedly asked in the House about a Bill dealing with company law which was left ready three years ago in the Department where I was privileged to serve. It was to try to put an end to the activities of some gentlemen. The reality is that more people are being ripped off by those operating within the law than there are by those operating outside it. If an objective examination was made of the activities of the banking community by a group of experts they would come to the same conclusion. Surely it is time for this or some future Government to act and find out if what I and thousands of others believe to be true about the role of these institutions in society is true.

Tomás Mac Giolla

I shall have to curtail my remarks in view of the time limit. I commend Deputy O'Malley on his excellent and spirited defence of State companies as against private companies. It is a new departure for that Deputy. I also agree with his comments regarding Deputy Skelly's performance. It is an extraordinary performance, and probably unique in political life, on the single issue of whether a contract should be awarded to a particular commercial concern. I am not saying that Deputies should not urge Governments to adopt specific policies or pursue specific issues.

For many years I have consistently supported the CIE plan for a rapid transit system in Dublin. CIE have acquired much of the land that Deputy Skelly and the Canadian company are talking about. I do not recall Deputy Skelly calling for support for the CIE plan for a central station in Dublin and an underground rail system leading to rapid rail for Tallaght, Clondalkin and Blanchardstown which is on the stocks for many years.

The question must be asked about why he is giving such dedicated backing to this company whose creditworthiness, viability and capability to carry out such a huge development requires intensive investigation. Why is he endeavouring to blackmail the Government into rushing into signing a contract with this Canadian concern as his price for keeping the Government in power? That question has not been answered adequately. It is up to the Deputy to prove that he has no personal or commercial interest in this company. Perhaps the company have the necessary financial backing and are competent to carry out this project but the Government must not throw away taxpayers' money in an effort to buy Deputy Skelly's or any other Deputy's vote.

The circumstances leading up to this vote of confidence are that over the past few months many Coalition Deputies and backbenchers have been huffing and puffing about endeavouring to show that they are reluctant supporters of the Government and might well vote against them hoping this might improve their chances if a general election did take place. The Government's policies are not significantly worse now than they were in 1983, 1984 or 1985. They are the same policies being pursued by the same Government — consistently anti-working class ones at that. Deputies who are now threatening to pull the plug on this Government had no difficulty in supporting them during those years when they pushed up unemployment to unprecedented levels. When food subsidies were cut on two occasions they supported them. Free school transport was withdrawn and that was supported. Major health cuts were supported by all Deputies. None of them voted against any of these measures. Deputies Cluskey and Skelly consistently voted for the Government on all issues: the breaching of agreements with the public service unions and the scuttling of Irish Shipping, which was referred to by Deputy O'Malley. Yesterday we saw Irish Shipping workers walking up and down outside the Dáil. The manner in which this Government have treated them is absolutely disgraceful. Deputy Cluskey referred to the handing over of taxpayers' money to Allied Irish Banks to rescue them from the ICI debacle. All these measures were supported by all the Deputies who are now saying that they are worried about this or that.

There are two basic issues which we must face and on which we have no confidence in the Government. The first is unemployment. That unemployment should go over the 200,000 mark and then up to almost one quarter of a million — 240,000 unemployed — at a time when emigration is also increasing at an enormous rate is scandalous. There are 60,000 more people unemployed since this Government came into office. They have no coherent policy for job creation. The Taoiseach says that it is not their function to create jobs. I have consistently pointed out that that is the Taoiseach's attitude. It has led to a situation where the Government are putting people out of jobs. Currently in B & I there are 370 workers threatened with redundancy. This is how inflation is brought down. You cut jobs, you have the unemployed unable to pay for anything because they have no money to buy goods — and inflation drops. It is as simple as that. That is what is done in Britain to bring down inflation. The Government are proud of bringing inflation down, but the price of that is huge unemployment. As far as The Workers' Party are concerned, the record of Fine Gael and Labour on unemployment alone would be sufficient to justify a vote of no confidence in the Government.

Deputy Cluskey referred to the cowardly and spineless performance of the Government in the face of the anti-social activities of financiers and currency speculators in pushing up interest rates, irrespective of the consequences. The response to that by the Minister, Deputy J. Bruton, is that the Government can do nothing about it. That is a total abdication in the face of these establishments. Fianna Fáil's response to that is no better, because they have said that we should be nice to the financiers and speculators, to these people who are carrying the loot out of the country, taking billions of pounds out in sackloads, the wealth of this country created by Irish workers. Fianna Fáil's response is that we should remove DIRT and should not tax these people. They make excuses that these people are right to take this money out of the country because we are putting taxes on them. That is not the response the people expect to those who should be regarded as traitors to the country and should be treated as such.

The Government are prepared to take on the poorest and weakest sections of our society, in other words, to freeze workers' wages or cut health or social welfare spending, but the banks are not to be taken on. They and the financiers are to be allowed a free hand. The speculators are to be allowed to continue their anti-social activities and to create this enormous economic black hole which is increasing in size every year. If Fianna Fáil come into power, unless they face up to this issue they will not be entitled to the confidence of the people. On these two issues of unemployment and the activities of financial speculators, there has not been as much as a squeak from the Labour Party. During the 1982 election campaign the posters proclaimed "Labour — a Voice that will be heard". However, the position today is that the once proud voice of the party founded by Connolly is now nothing more than a whimper.

Having heard Deputy Cluskey's remarks, with all of which I would totally agree, I find it difficult to see how he can vote for the Government. Following that speech we should start moving fast because it looks as if this Government will be defeated on this vote.

An Leas-Cheann Comhairle

I call Deputy Reynolds. He has 30 minutes.

Mr. Reynolds

I cannot honestly believe that the Taoiseach, in putting down his vote of confidence in the Government can really expect this House——

Mr. Skelly

Surely the rota should come back to the Government side.

An Leas-Cheann Comhairle

I want to explain to Deputy Skelly that 30 minutes have been allocated between Deputies O'Malley and Mac Giolla. Deputy Mac Giolla was not present at that time so we gave him ten minutes when he returned. Deputy Skelly will be speaking next.

Mr. Reynolds

I cannot really understand how the Taoiseach can ask this House to vote confidence in his Government when he himself at the Fine Gael Ard Fheis this weekend made the most remarkable statement ever made by a Taoiseach, when he said "This Government is not seeking re-election". If that is so, surely it is the height of hypocrisy to expect the House to vote confidence in him when he himself has no confidence in his Government. The parties in Government have now decided to go their separate ways and have declared in advance that they are not seeking reelection. The greatest contradiction of all is to see those two parties hanging together for the sake of hanging on to power, trying to do any possible back-room deals. There were sad and sorry sights around this House in the past two days. We saw Minister after Minister, one Deputy after another, those whose votes are in doubt, in corners, on landings, everywhere trying to squeeze some kind of deal at the last minute to hang on to power.

The Taoiseach likes to be known as a statesman. He was sold heavily as a statesman. If he has any regard for the future of this country, he should do the decent thing and recognise that there is not even confidence in him within his own party. There is no confidence in labour support for the Labour Party in this House. The opinion polls have said time and time again that the country at large has no confidence in the Taoiseach but yet he is prepared to hang on to power by any device, which he so loudly condemned for many years around this House. That is hypocrisy at its worst. Like Deputy Mac Giolla, I cannot understand how Deputy Cluskey could vote for the Government. I cannot understand what is going on within his party. When he talks about having to spend the past two or three months looking for information about Dublin Gas he is not fooling me and I do not think he would fool many right-thinking people. That was the neatest bit of Abbey Theatre politics that I have seen exercised in a long time. His own leader has not yet explained to the House — and I hope that he will explain this evening — how it took him three months to gather up the information that should be readily available on his desk as the Minister responsible for Dublin Gas.

Why was it only last weekend that he got that information? I am not complaining about the Minister giving the Deputy the information. What I am saying is, is it more than a coincidence that when my questions went in last week the information was given out to Deputy Cluskey? Is it not a remarkable contrast that Deputy Cluskey could get the information? He was delighted that it was delayed for three months. It was the best stage act that I have seen for a long time. Would he have got the information had those questions not been put down? The Tánaiste should answer that this evening. If that is the case, would Deputy Cluskey not join with me, on behalf of the taxpayers, in extracting further information in this House. We all saw the disdain with which those questions were received yesterday. I put down questions yesterday seeking information but I got no answers. Deputy Spring, the Tánaiste and Leader of the Labour Party, issued a statement two days ago to say, good man Frank. He told him that he was great to have initiated this marvellous investigation. The Minister with responsibility for Dublin Gas for the last three years said he was surprised at what he found when he went looking for information. If that is not an abdication of ministerial responsibility I do not know what is.

Words have lost their meaning as far as the Minister is concerned. I am not surprised that the general public have become cynical with politicians. Ministers, the Government and everybody else. The central part of the question which I asked yesterday was the cost of receivership. The Minister said he was not quite clear what I had in mind by the cost of receivership. He installed a receiver and when I asked how much that cost to date he did not understand the question. If he did not understand it yesterday he understands it today. I would like him to answer that question. Would he not also admit, if he knows the rules of receivership, that he undermined the receiver he appointed when he came into this House and said that every legitimate creditor will be paid in full. On the day he made that statement there was no need to have a receiver. A receiver protects the money of the party that appoints him. He was in no position to act as a receiver. In my view he is acting as the management of Dublin Gas. That is a very expensive way of managing that company.

I asked what was the position of the banks in relation to the funding of Dublin Gas. I want to clear away a myth. People are hiding under an umbrella that the fall in oil prices caused the problems in Dublin Gas. I will remind this House that the banks stopped funding Dublin Gas in August 1985. No collapse came in world oil prices until November-December of that year. The problems were looming big in August 1985.

The Minister received report after report during that period. Four of his personally chosen members of the board must have told him what was going on but yet he did nothing about it. Today, in retrospect, everybody wants to forget what brought the crisis about in Dublin Gas. They blame it on the oil prices. That is not what happened.

My second question yesterday was in regard to what went on in the last three years. The answer I got was that it will cost too much money to get that information. I asked about senior management's pension funds and other areas of expenditure so that this House would have an idea of what went on in Dublin Gas. I say to the Minister today that the cost of getting that information is about £200 or £250. A junior accountant or one of the staff could get that information in two hours. Why is it being denied to this House? It must make very bad reading. The £600,000 deal may be bad but there must be other things included in that. I am demanding that information. I want every aspect of the Dublin Gas issue to be fully aired in this House. If I do not get that information I will ask for a public sworn inquiry.

I will give the Minister a few examples of some of the information that I want. I want to know why a senior management member was made redundant. He got the same deal in line with what the unions negotiated. A very short time later he was re-employed by the Minister's receiver at a consultancy fee of approximately three to four times what he received when he was working. Why was he made redundant? When that individual was first employed did Dublin Gas, a company funded by taxpayer's money, give him his payments tax free? Not alone that but they also guaranteed and indemnified a foreign company against any tax liability that might arise. Is that the way the business of Dublin Gas has been run? Those are serious questions which must be answered. They are part of the question which I put down yesterday. I know why I did not get the information. There is probably much more that I do not know anything about. It is my duty and responsibility to get that information.

I would also like to know why an insurance premium of £771,000 was paid to an insurance broker in this city for the conversion project 12 to 14 months before that project started. I do not know who the company is. I am interested, as I am sure many other people are, to know the answer to that question. I would like the Minister to answer it today. The more information I get the more questions I will ask. I am not on a personal witchhunt but we are all entitled to know what went on in Dublin Gas for the last three years. We are entitled to know if performance bonuses were paid when no performance was forthcoming. As regards Deputy Cluskey's innuendo, and the Minister implied it yesterday evening, we are now hearing four years later that the deal was negotiated by Fianna Fáil. I was Minister in 1982. As I said to the Minister, I welcome a full Government debate on every aspect of Dublin Gas. If I cannot get that information, if it is covered up and swept under the carpet then, I will ask for a public sworn inquiry. I have nothing to hide in relation to any business I did with regard to Dublin Gas. When it came to finalising this deal, that is only one extract. Go back and look at all the paper cuttings and announcements in the House and no mention of Deputy Albert Reynolds was made in 1983.

This was a deal far superior to anything I was thinking about, a different deal. Four years later when the thing collapses someone would like to abdicate the responsibility and put it back on somebody else. That is the cheapest form of political cowardice that I know about. Have the inquiry, have the debate anywhere you like and I will be there to stand over everything I did in relation to negotiations in regard to Dublin Gas because I have nothing to hide, but I will not accept political innuendo, whispering around the corridor or anything like that in relation to it.

I ask the Minister if Dublin Gas are providing the total of that £600,000. If so, what happened to Irish Life and Mr. X, the man we are talking about here? I am on no personal witchhunt. I would compliment any top management who could sell a deal like that to a board of directors and a Minister. If he was good enough to be able to get that sort of deal fair play to him, but the people responsible for approving it are the people I want to point the finger at, not the person who got it. Are the gas company supplying this £600,000? If not, where did Irish Life fit into this whole scenario? This was a former employee of Irish Life with his pension being funded by Irish Life and if the Dublin Gas Company put up that figure then Irish Life made a profit out of this gentleman leaving their company and joining the Dublin Gas Company. If that is so that can only be the end result because much of what we are talking about should have been provided by Irish Life when the man was their employee as no doubt he was. I want to know what happened in the final analysis.

The Minister's surprise amazes me. It is the greatest act of hyposcrisy and Abbey Theatre stuff that I have come across for a long time. I believe Deputy Cluskey to have his differences with Deputy Bruton and that is none of my business but when he talked about Deputy Bruton going down to the bunker with somebody else, and the feeble attempt to cover up and sidestep questions here yesterday leads me to believe that a third has already been in the bunker because that was an exhibition of bunker politics and trying to step out of responsibility.

I ask the Minister, who will be coming in here this afternoon, whether £200 or £300 to a junior accountant will not get me that information I am looking for about a company who spent whatever the figures are. Today I listened with interest to Deputy Cluskey reading from the letter that he got from the Taoiseach saying that the losses were £126 million. Yesterday afternoon at Question Time the Minister said that the losses were not determined. The Minister says one thing, the Taoiseach says another. When are we to get the truth? The receiver has already two reports on the Minister's desk with very solid estimates of what the losses will be, yet the Minister chose to duck it yesterday and said that he could not say what the final position would be because he did not know what the losses were. Yet the Taoiseach could tell Deputy Cluskey what the losses were. Why? Because then he would have to answer the direct question, "Are the banks losing money out of Dublin Gas?" It is clear that they are not. His final answer was: "If the company goes down the tubes the banks will lose their money".

Today at Cabinet level we are told that the nationalisation project of Dublin Gas is on the agenda. If they are going to nationalise it today there is no question of the company going down the tubes as the Government are going to take them on board, therefore there is no question that the banks will lose their money. In every company restructure that got into problems with finances over the last number of years there would be very few cases where the banks had not to take the knock and take part of the losses in relation to everybody else. In relation to Dublin Gas when the receiver was called in, everybody lost but the banks and those who had the volume related stock in the company. The taxpayer lost and continued to lose through An Bord Gáis. The banks will lose nothing. That is in stark contrast to the deal presented to this House and sold heavily around the country by the present Minister for Finance when he said that the banks, the commercial sector, the private sector and the taxpayer all shared equally the risks involved. In The Irish Times of 12 December 1983 he is reported as saying that it was worth repeating that in the present deal the banks were not guaranteed their money back; they were merely assured that price control procedures would not be artifically operated to prevent them being repaid and if the company went down, the banks stood to lose substantial sums.

It is an insult to the intelligence of anybody who understands finance for the Minister to say to this House that the banks who withdrew from funding Dublin Gas in August 1982 went back by the good grace of their hearts to refund the company with a nice, cosy chat between him and them. I do not believe it, I do not accept it. I find it hard to say in this House that I do not believe what a Minister says, but I do not believe that for one minute and I challenge the Minister to put the correspondence he had with the banks in the Library so that we can see in the interest of the taxpayers what deal was done with the banks, because a deal in some shape or form was done. Why did they stop funding in August of last year when they were not happy about the situation as they saw it? Why should they go back in later if they were not getting the position clarified as to where they were going to stand? Yes, by all means the taxpayer is going to lose heavily. The banks will not.

It amazes me that Deputy Cluskey would come into this House and say that he is the great hero of the whole episode. Go back and look at that Deputy's resignation statement when he resigned from the Government. What did he say? I have not the exact quotation here but everybody knows why he resigned. He made it clear that he resigned because four or five or a handful of private investors were going to make a solid fortune out of Dublin Gas. Go back and examine the records. What is he saying today? He is not saying the same thing. Maybe he got it right for the wrong reasons but for Heaven's sake let us be clear about why all concerned took the positions they took. He was a Minister in the Cabinet and it amazes me that some of the things that I talk about here and some of the things that have gone wrong down there for the last three years are not available to Cabinet members. Maybe they are not but if the Minister is not aware of them he should have been aware of them. I cannot understand why he was not because reports regularly hit his desk in relation to it.

Dublin Gas will roll on. I hope the Minister will give us the information here this evening. It is clear that gas may have flowed in but money flowed out. I am interested in the money that flowed out, who got it and where it went. Whether I get answers this evening or not I want to make it clear that I am not on a witch hunt of any management, I am on a witch hunt of the people who hold the responsibility for allowing those deals and approving those deals to be done. That falls right back on to the Minister's desk. I know what the score is from here on in and I will continue to press this.

Managed information and misleading statements to people who do not understand what is going on down there can easily create the wrong impression. There was a statement in yesterday's paper from the Minister in relation to chairmen's fees. Any non-executive chairman or any non-executive director of a semi-State company is getting buttons in relation to what is expected of them, but the Minister did not make clear on that that one executive chairman of that got the normal £2,000 or £3,000 a year or whatever it was and the next chairman — he did not say whether he was executive and I do not know whether he was — got between £24,000 and £25,000. If he was a non-executive maybe the Minister could explain the differential between £2,000 to £3,000 and £24,000 to £25,000. If he was an executive, that is fine. That is the rate for the job, but let us be honest and clear and let him tell us exactly what we are dealing with. I have no personal hangups about any of the managements there. Look to the good deals they did but the foolishness where the responsibility lay is out of this world.

I leave that issue. If Deputy Cluskey is listening somewhere to what I say, I still want to know about Dublin Gas. I would like to know that he would take an interest because he seems to be a hell of a lot more successful than I have been in getting information. I went through the official channels of democracy in putting down a question and I got no answers. He seems to be much more successful. If I am not successful, in the interests of democracy and the taxpayer maybe he will give me a little help.

Mr. Skelly

How will you do it?

Mr. Reynolds

You have to have your own man sitting in the Chair. I am not stupid enough to try to think out how Deputy Skelly is going to do it. I will leave Deputy Skelly to his own technique. I do not know how he is going to fare with his Bill but things were going well yesterday evening and there were plenty of representations made to the Deputy.

But let us come back to the serious business of the no confidence motion. I have asked a serious question and I will leave it at that. I could not attempt to vote confidence in this Government for two reasons and we could go on here all day in relation to them. First, their financial judgment has been disastrous and secondly, their economic management has been atrocious. I will give a few very quick examples of what I am talking about, some of them already mentioned here today.

The financial judgment of this Government in relation to what they did with ICI has been well and truly catalogued. We said at the time — and I said it repeatedly myself — that it was going to cost more money to close that company than to keep them in business. We do not know the end of the bill yet. But quite clearly at this stage the point has been proved.

I also want to raise my voice in support of the people outside that gate. I do not believe in street politics but I believe in equity and justice being done and being seen to be done. I do not know how any member of this Government or any man over there can say to the people of Irish Shipping "you have to do with your lot". When the miserly sums they got are compared with the various settlements in Dublin Gas, Avoca Mines and so on — I could go through the whole semi-State sector — how can the Government look people in the face and claim to be a Government of honesty, integrity and justice? Those qualities do not obtain so far as they are concerned. I support the case of the employees of Irish Shipping fully when I see what the Government have done in many other instances.

In regard to their financial judgment in relation to ICI, I said at the time that we were in a bottomless well and we did not know where the end was or how much we were getting ourselves into. Yet the Government were prepared to write a blank cheque to a banking institution, not even putting any of the responsibility on them to meet it out of future profits and they have had very substantial profits since then. I hope they have even more success because it is good to have a strong banking organisation. On the other hand, we are here in the interest of taxpayers and for us to have given a blank cheque to a company and not ask them to repay even over a long period — I am not interested in weakening bank situations in this country — must have made them smile all the way back from the Office of the Minister for Finance to their headquarters in Ballsbridge on the evening they did that deal. So much for that financial judgment.

Let us come to one of the aspects of the real financial crisis of confidence that exists here at the moment. In 1983 this Government opted for devaluation. In 1983 that was totally unnecessary and wrong. Look at the problems it created and all the money it cost. But in 1986 when there was a realignment of EMS currencies our Minister for Finance went to Europe accompanied by all his advisers and sat down at the table. It was said afterwards that Ireland was not moving its exchange rate because ours is a strong currency. The real financial misjudgment that was made at that time was that unfortunately the present Minister for Finance listened to his advisers who were talking about a very narrow section of the economy so far as they were concerned, in other words, the confines of the Department of Finance, how a movement would affect the national debt, how it would affect this and that. The real economy that earns the money for this country was forgotten about when the Minister walked home from Brussels with his advisers and said we were a strong economy and were not moving. Within four months he was forced into a panic devaluation in the month of July and that in turn brought the focus of international lenders right in on top of us.

Here is the Government who said four months earlier that the economy was so strong they did not have to move their exchange rate. Four months later they are forced into a unilateral devaluation which meant that the kitchen was too hot, something was wrong and they could not cope with it. That is part of the real problem of lack of financial confidence at the moment. Was the Minister for Agriculture acquainted with this? Did he know anything about it? I would like to hear that question answered in this House, because I do not believe he did. If he did he would have said to the Minister for Finance that a devaluation at that period in July would mean we would not be able to get any corresponding devaluation for the Green £ until September. I do not believe he was asked about it or acquainted with it. I suppose that should not surprise me because he is the man who went around the country and could not even see floods in front of him. There was a responsibility on him but obviously it was not put through the proper channels. Within a matter of a week to ten days the total impact of that devaluation had gone wrong.

What position are we at today? Employment is the priority of everybody in this House. I would like the Members of this House to realise that right at this moment there are 10,000 jobs at risk in our native indigenous industry because of the bad financial judgments of this Government. Can anybody in this House honestly say that 96p is the true value of the IR£ in relation to Sterling? Of course they do not believe it. But we are in a system that has been holed up by the German Mark and is totally unrelated to the real position of our economy. If somebody does not take note of it very quickly, the repercussions of a continuing 96p exchange rate will be there for everybody to see. It is in the area of our native indigenous industry that it is going to happen. It will happen in our own industries because they cannot cope with a 96p sterling, increasing interest rates and all that goes with it. Everything is working against the native indigenous industry.

I want to put this on the record before I go, in case somebody does not realise it. What Irish companies in the indigenous industries are being forced to do at the moment is to go out and source their supplies in the UK Sterling area to try to cut down the real risk involved in running their business. The reality is that their prices in the UK market, to which 35 per cent of our exports go, are down 14 per cent from last year and nobody knows how that gap is to be bridged. The Government have a responsibility to make sure they are competitive because the added cost to Irish industry at the moment is £340 million. That is the added cost of telecommunications, energy, transport and so on. Strangely enough that is the difference between what was put into the Government estimates when they put in an inflation rate of 4½ per cent. We now know inflation will be less. Inflation has come down but it is not being put through the economy, and while it is not this economy will lag down below. There can be no confidence in a Government who have brought this economy to its knees in four years. The silly comparisons of the Taoiseach mean nothing in reality. If he would stop throwing figures around like snuff at a wake and get down to understanding what is happening in this country and the crisis of confidence in the finance area and in the unemployment area, he would see that times are good, times are improving. There is a list there as long as your arm. But we are going in reverse. Unfortunately I have to say it.

Mr. Skelly

If he fell asleep there he could still keep talking. In my view one of the dirtiest words in the English language is "blackmail". It is probably as bad as words like "kidnap". Maybe in a moment of temper that kind of word can be used. But it was used recently against me in relation to a project I had been putting forward and in relation to the work I have been carrying out in this House in the past number of years. I would like to mention it without casting aspersions on anybody. But unfortunately this word was used publicly by a member of the Government against me. The definition of the word does not really come into play at all because it was used in the context not of blackmailing for money but in the context of getting my project through as otherwise I would vote against the Government.

Usually a Government govern for about four years according to a plan and a policy, and in the fourth and fifth year it is decided to call an election. We have gone through nearly four years in office and for three of those four years I have been putting forward, behind the scenes and in the normal manner as accepted by Members, backbenchers in particular, proposals to Ministers and at parliamentary party meetings.

Because I was so upset at this kind of tag which was an attempt to discredit me and the project for which I was working in the interests of the people whom I represent in my constituency, the unemployed in the country and the thousands who have left it, I would like to put on the record of the House that I first became involved in this project in 1983, a few months after we came to office. The first contact made with the promoters of this project and the Department of Communications and CIE was in March 1984. There was a year of preparation before that was done, and I will not bore the House with details of it. Meetings were scheduled and documented from March 1984 right through to this year. From February 1986, two years from the first contact or three years after I made the first contact, a submission was made by way of query sheet on the project by the Department of Communications and sent to the promoters. That was the only communication of substance received by the promoters in two years, although numerous documented meetings had taken place, and innumerable telephone and telex contracts had been made in between.

We all want investment in the economy. Some of us believe that investment from outside is needed because we do not have the resources ourselves to get things done. In the spring of this year, after two years of trying to get things done in the normal way, which I do not think is in the best interests of anybody in the country because we do not seem to change the normal way of doing business, I went on what I will refer to as a political tack. I did not do it publicly: I got support from people in my constituency and formed constituency action groups and I got support from a fellow TD. Eventually I showed the thing to all Dublin TDs, and 25 people came along. I then had delegations to the Taoiseach and to Ministers about the project. That all took place since May of this year. It was only after all of that action that consultants were appointed and given a very broad brief to help them to carry out their task. The consultants reported in July and I was to be given a decision on what would happen to this project.

I realised that the life of a Government ends in four years or shortly after four years — it is an exceptional Government that goes on for longer. The only alternative at that stage is to leave the Government, go and ask the Opposition if they would do it when they get in, or something like that. I did not do any of those things.

If we want people to invest in our country we must treat them in a businesslike manner. People in the Departments, particularly the Department of Communications, have records of semi-State bodies spending ten years travelling the world trying to interest promoters in investing hundreds of millions of pounds in the infrastructure of this city, which is about to fall into the river, and they got no response. Then, when they actually get a bite and promoters come to them, they should treat those promoters very smartly and not try to drive them away from the country. If we have people coming from half way around the world to attend meetings with Ministers or officials in Departments and we leave them waiting around in waiting rooms before being shown into the august or divine presence for ten or 15 minutes to get a handshake and be sent off again — I am talking about professionals of the highest international calibre — they are not very impressed. They are even less impressed if they do not receive replies to proposals involving hundreds of millions of pounds.

Mr. Kenny

Ye men of little faith.

Mr. Skelly

That actually happened. In some parts of my constituency we have 85 per cent of our people unemployed. We have very high unemployment throughout the country. In the circumstances they do not want swamies coming before them at public meetings telling them that there is no hope and that it is wrong to give hope when there is no hope. We want to see some kind of optimism or, to use a phrase used commonly, we want to see some light at the end of the tunnel. I maintain that there is light at the end of the tunnel if we would only build the damn thing.

Members of the House have the responsibility of trying to resolve the problems of the country, and I should like to tell them, especially the Dublin ones, that the days of milking parlour clinics are over. The days of Governments swapping office every three or four years, with the country putting up with the most appalling mess imaginable, are over. We see parents having to look at their children from an early age knowing that they will have to emigrate, leave the country, mainly because of the largely incompetent makeup of the Members of this House from which Governments are chosen. It is because they are unable to tackle the problems that they cannot offer our people any hope for the future.

Those days are fast coming to an end, and if I am precipitating that end I do not make any apologies for it because, as I will say later on, I am not here to safeguard a seat or on a career break from business during which I can spend 20 or 30 years here and eventually draw my pension regardless of what happens to the rest of the population.

The sort of treatment I have been referring to comes from what the Taoiseach honestly and sincerely refers to as a first division team. When one makes that analogy one must remember that there are different positions in a league table and that if this is the kind of action you get from a team they will face relegation to the second division. This does not give much hope to the country or for the future of our people. Then, if someone stands up and says that he is determined to do something about it or else, but does not put forward the "or else" until three quarters of the life of the Government has gone past, he must be put down so that we can continue with the form of management of our country and our people that has gone on in this State for 60 years and looks like continuing to go on unless the people outside wake up and are brave enough to change it, or the people inside insist that it must change of itself or come tumbling down, or it must die, or must be replaced.

I listened very carefully to the Taoiseach's Ard-Fheis speech last Saturday and there was one throw-away line which I did no see anywhere in print. He said the Government would look at anything that would get our people back to work. Maybe it was aimed at me because I have been asking them to look at something that would get some of our people back to work for a number of years.

I feel that the best thing for the Government to do would be to perform and stay on to the end of their term. I would like to be a member of a reforming party and I would be prepared to go to the wire with that party provided we could create the thousands of jobs necessary to put our people back to work and could prove — and we have not done this to date — that we are a nation fit to rule ourselves. Speaking for myself, if we cannot do that. I am prepared to take the ultimate step whether that means getting out of this House or making sure that what I would like to see done is done, unless it can be proved that it would be wrong to do so.

I do not intend giving a lecture on the plight of the unemployed, our youth or emigration because they are well documented. A survey completed in the past two weeks reported our priority must be the creation of jobs. It took that report to get us to suddenly devote every ounce of energy towards the creation of jobs to the exclusion of care for the aged and education for the young. I have been saying for the past four years that our priority must be job creation.

I want to refer briefly to the project on which everybody seems to be hung up. This is really an attempt to save Dublin and to put thousands of people to work in a way which has not been attempted in this country before. Earlier this year in order either to arrive at a decision or to kill off this project, consultants were appointed and they reported to the Government. Their report was totally negative. From my point of view, and it is only a personal point of view, it seemed to be a complete hatchet job. The kindest thing that could be said about it is that the Government had been conned and the worst thing that could be said is that with consultants like that we do not need an Opposition.

They made very basic errors, many of which have been leaked to the public, such as getting the length of the tunnel wrong by about 30 per cent, getting the cost wrong and they dwelt a great deal on displacement. They told us that the future in the development and construction of this city lies in a flat earth policy; in other words, we cannot do anything because it will affect something else. According to them the best thing to do is nothing. That was the real reason for the controversy which arose about me in the past few weeks. It did not really have anything to do with the word "bunker" in my summary of displacement economics, the effects they have had on the Government in the last few years and the paralysis that has resulted in employment and job creation.

A country is its people and who in his right mind will accept a policy of shedding 500,000 people in order to create an employment atmosphere? The document to which I referred, written by consultants called DKM, has been widely referred to in the past few weeks but the answer to their document produced by Coopers and Lybrand Associates has not been referred to. I want to make a few brief comments on it and I quote from that document:

We have serious reservations about the treatment extended to the "displacement effects" of the project...

In principle, the concept is validated only by the existence of geographical boundaries. Carried to its conclusion, and extended across geographical or national boundaries, the concept clearly implies that there is no justification for any office or retail development anywhere, since the effect of such development is to displace economic activity from an existing location or property. In the Dublin context it implies:

(i) that both the Custom House Dock incentive package ... and the investment plans for road development in Dublin... are undesirable on economic grounds:

and

(ii)that any programme of urban renewal or redevelopment is similarly undesirable.

Without dwelling on it, I want to mention that these experts — economists, unfortunately — also got the length of the tunnel between Heuston and Connolly Stations wrong, as well as the cost. If we extend that type of reasoning we must consider closing the faculties of engineering in our universities. We are moving into the private sector and going further than a government should go when we say what should and should not be done. For example, we might go to the people working on the St. Stephen's Green site and tell them we are closing it down because this might displace jobs in other parts of the city.

The secret to this project lies in interfacing public transport with a commercial activity. This has worked very successfully in North America and has created tens of thousands of jobs. This interfacing creates its own motivation and its own success. The consequence of the acceptance of this form of economic analysis is that no major property construction or investment in retail offices, hotels or apartments should take place because it could interfere with the status quo. I ask the Members of this House to consider the long-term effects of that sort of policy. The conclusion is so patently flawed and reflects such a basic lack of knowledge of the property market and confidence in the city of Dublin as to be unworthy of a response. Yet, on that basis we are to make a decision that the city must die, that there is no future for the people, no hope for the youth and all we can offer is emigration. We spend fortunes educating our youth so that they can go abroad. This log-jam is not being caused by people outside; it is being caused in this House because we are responsible for the running of the country. If we must rely on people with very limited experience who say we cannot do this or we cannot spend any more money, we will have no future.

I said the Canadian proposal did not require any initial capital outlay on the part of the State, CIE or any body other than the promoters whose responsibility it is to raise by means of equity and borrowing the entire financial package for the infrastructural elements of the above ground developments north and south. That is all I want to say about the technical end of that matter. As I said, in my view there has been an attempt to kill this project by consultants who do not have expertise in this area but we have not heard the results of the other consultants survey at all.

That other preserver of dereliction who writes for The Irish Times went so far yesterday as to make up a bogus meeting which took place between me and the Minister for Communications during which I was supposed to have made threats to the effect that the Government must get involved in this project or I will vote against the Government today.

Debate adjourned.