Dáil Éireann debate -
Thursday, 14 May 1987

Vol. 372 No. 9

Financial Resolutions, 1987. - Financial Resolution No. 3: General (Resumed).

Debate resumed on the following motion:

That it is expedient to amend the law relating to customs and in land revenue (including excise) and to make further provision in connection with finance.

—(Minister for Finance).

Mr. J. Higgins

Prior to the adjournment of the debate I was making the case that the multi-million pound Estimates which are the preserve of each Government Department are often thrown to us in global multi-digit figures which bewilder people at first sight. However, on closer examination it can be discovered that some of the Departments are top heavy and that many rational cost saving measures could be introduced. Taken collectively they could have a considerable impact in terms of savings. I made the point that in relation to a simple matter like the erection of a new house in County Mayo, the constituency of the Minister for the Environment, when a person applies for planning permission to build a new house, qualifies for an SDA loan and applies for a new house grant and mortgage subsidy, five different inspections by five different engineers must take place. Those officials are all paid travelling expenses and they carry out the same work, checking up on standards and the work carried out.

Surely it is time we rationalised grants. Surely that is an indication that we should devolve to local authorities the entire area of housing. If local authorities are deemed competent to undertake expenditure in regard to road works in their areas they are equally competent to deal with all work connected with housing. A person who applies for a house improvement grant, or a new house grant, contacts the Department of the Environment but if he qualifies for an essential repair grant or a disabled person's reconstruction grant the application is made to the local authority. There are numerous cases where people qualify for a grant from the local authority and from the Department of the Environment. That strengthens the case I am making for rationalisation. We look to the Minister, Deputy Flynn, a Member with vast experience at local authority level, to grasp this nettle and do the sensible thing.

I notice with a certain amount of bewilderment that in the revised Estimate for the Department of the Environment there is a figure of £2,750,000, or an increase of 11 per cent, for travelling expenses for the staff of the Department of the Environment next year. That increase is provided for although there is a reduction in and termination of certain grants. It is difficult to comprehend how there can be such an increase in view of those developments. I must point out that that figure does not include an amount for engineers, inspectors and officials employed by local authorities. In the case of the Department of Social Welfare there is a provision of £3,835,000, or an increase of 16 per cent on the 1986 figure, for travelling expenses although, according to the budget, benefits paid by the Department will increase by 3 per cent.

A lot of rationalisation, sensible restructuring and reorganisation needs to be carried out in all Government Departments, local authorities and semi-State bodies. That would go a long way towards reducing excessive and unnecessary expenditure. If we are to give the economy the lift needed to achieve the growth anticipated by the Minister for Finance, we must create a sense of confidence among the business community. I do not think optimism was ever at such a low ebb or pessimism so prevalent. While in the US there is a certain amount of emphasis in relation to manufacturing industry, the new thrust which has managed to fuel growth in the economy has been the development of the services sector. We have vast potential in the services sector. This potential needs encouragement and that is why low interest loans and capital in the services sector are of paramount importance. People in Government Departments will say that the services area should respond to manufacturing impetus. Anything that helps to generate economic activity is good so we should take another look at the degree of funding in the service area.

The universities as sources of research and development and of developmental skills are largely untapped. The development facet of the universities in terms of their potential for the business community should be vigorously tapped and encouraged. The people who come up with the ideas that eventually become viable should be capable of harnessing and deriving the benefit from their ideas. The level of post graduate study going on here exceeds or is on a par with that going on elsewhere and we should use that resource.

According to the balance of payments figures for this year the amount of timber imported for 1986 almost hit the £600 million mark. Deputy O'Donoghue referred to our failure to harness and develop our natural resources. Forestry is an area that should be developed. Our forests are lying dormant, untapped and underutilised. When one looks at the amount of money spent on drainage to bring into agricultural production land that was never suited for agriculture and when one looks at the fact that County Leitrim for instance is capable of producing more sitka, pine and spruce than the Scandinavian countries, one can say that we are sitting on a vast resource which is underutilised. The previous Government in co-operation with the European Community introduced a capital scheme for private afforestation giving lucrative grants of 80 per cent to individuals to afforest their lands. It has been recognised that while there is a high level of generosity in relation to the grant, one cannot induce people to hand over their land on a sale or a lease basis until they can be guaranteed an ad hoc income. I welcome the announcement by the Minister of State, Deputy Smith, that he proposes to introduce a scheme whereby farmers investing their land in afforestation are now being considered eligible to receive a certain amount of headage payment in the interim. While I laud the suggestion as a move in the right direction, it is not adequate compensation for people who hand over their land and I would urge that a dignified system of afforestation including a guaranteed base income figure be given to people in order to break the back of this major obstacle that has thwarted our ambitions in this regard. We are now very much into the silly season with regard to speculation about oil in the Celtic Sea but we are sitting on a forestry reserve with an enormous potential which is streets ahead of anything we can produce from the oil and mineral industry in the short term. If the development of forestry is undertaken right away it will be a source of pride for future generations. As I travel the roads of rural Ireland I see lying idle lands that are manifestly unsuitable for agriculture. The Government should implement a land acquisition programme either compulsory or voluntary to acquire for afforestation land that is lying idle. The Government might also look at the possibility of using for forestry purposes the 40,000 acres of land that now lies with the almost dormant Land Commission. Forestry is underutilised just as is the food resource. We should immediately put serious investment into forestry to generate riches in future.

I welcome the announcement by the Minister for Tourism about the introduction of a low fares structure to encourage an increasing number of tourists to this country so that we can attract a number such as was attracted in the sixties prior to the northern troubles. This is an excellent idea which in time will yield dividends. The Minister unwittingly overlooked one aspect and that relates to charter travel to this country. Last year chartered air travel accounted for 14,000 passengers from the US. When our tourist industry was on the broad of its back, the chartered travel industry was one of the main components in generating income. It had been able to do so because of block booking and advance booking and because they could offer fares $50 cheaper than the scheduled flights. As a result of the measures introduced by the Minister the advantage has now been given to the scheduled flights and chartered flights are $50 more expensive than scheduled flights. It is not in accordance with the principles of fair play that this aspect of the tourist industry which has generated such wealth should be overlooked. The Minister should look with sympathy at the people in the chartering business and try to introduce a form of subsidisation to cushion them from the people who are now queuing up looking for money back because now Aer Lingus can give them a flight $100 cheaper than they paid when they booked. Something should be done to help the people in the charter business out of their unanticipated difficulty.

I wholeheartedly agree with the point made by Deputy Deasy, our spokesman on tourism, that in a purposeful fashion we have to lure back the English tourist who was the backbone of the tourist industry here and who was generally recognised as being the biggest spender. The British tourist has the greatest degree of common interest with us but that tourist has been lost to us as a result of the unfortunate consequences of the northern troubles. I share Deputy Deasy's reservations in relation to many of the Republican utterances which deter these people from coming here. In the past week we saw a number of unfortunate examples of bad publicity emanating from here which would deter British people from looking in this direction with a view to holidays.

Deputy O'Donoghue mentioned that bad advertising abroad can do irreparable damage to our image and he mentioned some remarks allegedly made by Deputy Spring in Lisbon. The fact that Clare County Council and a number of other local authorities last week passed votes of sympathy for the people who were killed in the ambush in the RUC barracks in the North will do irreparable damage and will only serve to dismantle the good work done by the various tourist boards for our general image abroad. It also undermines the work done as a result of the Anglo-Irish Agreement.

We should avail of every opportunity to decry in the strongest possible terms any act of violence which brings discredit on us. It is time we stopped being ambivalent. There is far too much blowing hot and cold about Republicanism and far too much is made of thugs and criminals masquerading as patriots who attack public houses or military barracks and mow people down in cold blood. It is time we cleared the air and made a united, unambiguous, unequivocal stand in this area.

Land tax has been a major bone of contention. There is a high density of small farmers in the west. Coming as I do from the west I unreservedly welcome this tax. It does not entail any red tape or the filling out of forms. It is a sensible tax. People with less than 20 adjusted acres will never receive a letter from An Cigire Cánach because they will not have a taxable income. These people will now receive a profile form but we have not been told how elaborate it will be. I have never seen an innocuous tax form. The argument put forward by the ICMSA is that people with a non-taxable income will be unable to retain all the necessary documentation because of the type of farming they are engaged in and will have to enlist the support of accountants at considerable expense to prove that their income is not subject to taxation. From the point of view of cost saving, not to mention fair play, this is something which should be re-examined.

The main slogan used by the Opposition, particularly in relation to the health services, was that health cuts hit the old, the sick and the handicapped. That is true. I would be the first to agree that if any areas are administratively top heavy they are the health services and the health boards. The health services were intended to be patient orientated. If ever an area was crying out for rationalisation it is this one. However, the axe or the cudgel is not the blunt instrument to use. It cannot be dismantled in one fell swoop. Trimming and pruning are needed and, rather than the axe the scalpel should be used.

There are many areas in the health services where expenditure cuts could be made. I suggested recently, having failed to impress the previous Minister for Health and Social Welfare, the present administration or the health boards, that there was a lot of duplication in certain areas. A person applied for small farmer's dole. He was factually assessed in relation to his income. His net income was arrived at by subtracting the expenses necessarily incurred in the running of his farm from his gross income. It was £62 per week. About the same time the person applied to the Western Health Board for a medical card. The system they use was the notional system where the number of livestock is rounded off and a theoretical sum is arrived at in relation to the person's income. The person discovered that there was an almost 100 per cent discrepancy in the assessment of his means by the Western Health Board compared to that done by the Department of Health. There are numerous such cases in every health board area but there is a proliferation of them in the Western Health Board area. If two officials using different systems arrived at a different conclusion, something is wrong. We all know there are two ways of doing any sum — one way can be cross-checked with the other but the answer should be the same. The bewilderment of a person who received two different assessments can be imagined.

I brought this case to the Ombudsman who decided that the system being used was not in accordance with the principles of fair play and justice. The answer is to have the same official carry out a means test and an assessment of the person's income. I do not care if the officer is employed by the Department of Health or the Department of Social Welfare. We should come down in favour of one system or the other. I would prefer the factual system.

The modest prescription charge of £1 proposed by the previous administration was based on a fairly sound principle. It was a modest charge and would have been collected by the chemist. It had considerable advantages over the amendment brought in by the present administration. The £10 per day will prove to be uncollectable because we cannot turn people away from our hospitals or ask them to pay £10 in advance. When they go home they will forget all about it. It would have been within the capacity of everyone to pay a £1 prescription charge.

Having witnessed street protests by the staff of the General Hospital in Castlebar last Monday night in relation to cutbacks and grim forebodings in relation to closures, I visited the hospital. The male A block area is now a mixed area for males and females. There were two nurses on night duty looking after 40 patients. There were chronically ill people, some of whom were receiving the last rites. Beds were in corridors and if you wanted to get to a patient at the other end of the ward you had to move a bed, a trolly or an apparatus for holding a drip. Conditions were barbaric.

Health board administrators put sensitive areas into the firing line in order to heighten the political dimension, but when the service is affected at this level it is time to cry halt. An indepth investigation should be carried out into how the cuts should be applied. The old, the sick and handicapped are the people affected. I will be in Ballina tomorrow night to participate in another mass rally in relation to cutting down the number of beds in the district hospital which caters for a huge rural area stretching to Bangor Erris.

I accept that cuts are necessary but it is important that they are targeted at the least sensitive areas and do not affect patient care. While we are pledged to support the broad thrust of the budget, there is no obligation on us to back any measures which will damage the basic structure of the medical and health services. That is what is happening at present.

We have frittered away or underexploited much of our natural resources. We have failed to realise our potential. We have an enormous capacity for growth. We have some of the best land in Europe. We have the smallest and best educated population. A nation that can excel itself in so many fields as Ireland has excelled itself in the recent past can lift itself out of the morass, the doom and the gloom by facing realism and achieving a consensus across the board in relation to what has been done. Any country that can produce a Bob Geldof, a U2, a Bono, a Marcus O'Sullivan, a Sean Kelly, a Stephen Roche, a Frank O'Mara and an Eamonn Coghlan can hold its head high and supersede and exceed the best in the world and excel in that area. It can set a headline for politicians. Let us get our act together, put the nation first and start co-operating in the common interest.

Dr. McCarthy

Does the Deputy not realise that the reason for the present position is that the last Government overspent by £55 million in the last two years?

Mr. Leonard

I was a little surprised that the Deputy did not even mention Barry McGuigan in that list of world leaders. A number of budgets of various Governments have reflected the people's wishes rather than the needs of the situation. Even though the vast majority of the people in the general election supported parties preaching on the need for greater restraint in handling the public finances, when cuts as witnessed here today were being implemented many of them protested as if the cuts were unthinkable. Significant cuts must be made and they must be made in the high spending Departments. That is the simple logic that applies. We cannot get away from that. The boom of the sixties and the advantages of entering the EC in the early seventies left our sights aimed too high. Our expectations also were too high, and that was our downfall. The oil crisis plus the depression which followed have changed the scene and we have been too slow in admitting to the change and in taking the necessary corrective measures. In that regard the previous speaker mentioned realism. Fianna Fáil in their term in Opposition examined the position and the areas where there was an opportunity for the development of our resources and they had many committees looking into it. They set their course principally on the development of those resources. In that there is a very substantial job creation element, and we should be able to reduce the national debt which doubled in the last four years. That was the one sad aspect of those last four years.

In regard to the development of our resources, in the last few days we had a promising statement from my fellow constituent, the Minister for Tourism and Transport, Deputy Wilson, on tourism which has a terrific potential for development. Many speakers have mentioned afforestation. Another area which has been examined closely in the last four years is the marine, and the spin-off in jobs from the development of that could be massive. Fruit and vegetable production has been mentioned in conjunction with processing of agricultural products and my county bears testimony to what can be done in the food production field. Fianna Fáil have set their sights on such development and I have no doubt that they will realise their targets in that regard.

None of us likes a cut that pinches us and it is human nature at all times to ask the other fellow to carry more of the load. The present mix of cuts and redundancies is unlikely to please many. I would like to see some cuts eased and more interest placed on other aspects. However, generally we must concede that the main thrust of the budget must be sustained even to make a beginning to getting our affairs in order. If a business concern were in the position that this country finds itself in at present, its backers whether they be the banks or the company's share-holders, would have withdrawn support long ago and would have called a halt to the whole affair. Borrowing must be got down to a reasonable level such as in the business world would be considered acceptable for the size of the operation and related to the ability of the country to fund. The price we have to pay is cuts. While it would be good to think that such cuts can take place without a reduction in services, that is unrealistic as most of the fat has been eliminated in the last few years.

Any member of a health board would be well aware of that in regard to any areas where cuts and deductions could be made. There must have been fairly heavy overexpenditure in many of those areas when we see what could be taken away and still, for example, we in the North Eastern Health Board were able to pass a budget last Monday and we are satisfied that there will be no serious hurt or effect on the people of the four counties served by that health board.

What can and should be done is to apply the funds available to the best effect so that the drop in services is minimised. It serves no useful purpose for any sector to act as if this is the end of the world, to expect other sectors to bear the cost and to leave a particular sector untouched. The extreme language of some of the protesters serves no useful purose either. It merely creates the impression that if enough noise is made the cuts will go away. One trade union have instructed their members not to handle the £10 hospital charge. I can only view that instruction as a most improper act by a union or anyone else. It is outside a union's proper functions. While I do not like this charge, it is part of a package of proposals to get our affairs in order and it was decided on by a properly elected Government. It is not proper for a trade union to try to thwart the rightful decision of a Government. I trust that saner councils will prevail and that that union will see the error of their ways. For much too long the pressure groups have exercised so much pressure that they have created a really serious position for Governments, and when we have a Government now who are willing to face up to that in a responsible, positive way it is important that they get the maximum support.

The main thrust of the budget must be about right as indicated by the downward movement of interest rates and some return of funds previously moved out of the country. It was regrettable that such a large amount of money was moved out during the last few years. However, because of the confidence generated by firm action we have the downward trend of interest rates and the indication that the funds previously moved out are returning at present.

A previous speaker mentioned the building industry. Like others, I was disappointed the budget could not have included more provisions to get the building industry moving again. However, I believe reducing interest rates and increased confidence will help in this regard. Somebody with whom I was closely associated all my political life, a Minister in many Fianna Fáil Governments, the late Paddy Smith of Cavan, always contended that the most important thing in any country was the creation of confidence. I am hopeful such confidence will be restored. The building industry may well find that the indirect effects of the budget may be more beneficial to them than the direct benefits for which they had previously hoped.

Many of us may have been suspicious that the control of cross-Border trading would have the desired effect. From a national point of view there is no doubt that the restrictions imposed on that trading were necessary. While some towns, such as Clones and Belturbet in my constituency, may have gained little from these recent restrictions, nonetheless I am satisfied that that action had to be taken because of the gross distortion of trade caused by the huge differential in prices on both sides of the frontier. People in towns situated even 15 miles from the Border now believe that proper trading has been restored. While we may all like to have goods and services available to us at the cheapest possible rate, at the end of the day we would agree that a business or trading structure built up in any area must be retained. Such cross-border trade was placed in grave danger by the variation in prices in recent years. Of course the ideal solution to this problem would be to have prices harmonised on both sides of the Border. It will take some time to achieve that aim but until then the Minister's action is justified. Indeed I would expect that a substantial case could be made to the EC for the retention of this restriction on cross-Border trading.

The tax position has been mentioned by previous speakers. One of the difficulties encountered in persuading people to accept the present high levels of taxation is the widespread feeling among taxpayers that the load is not being evenly or equitably distributed. This lack of confidence in the fairness of the taxation system, or even evidence of the existence of a will to ensure such fairness, constitutes a major obstacle. There must be a major effort undertaken to address this problem. I suspect that addressing that lack of confidence in the taxation system is even more urgent than the reduction in taxation rates. The recently published lists of settlements by the Revenue Commissioners with various people and concerns — while showing some action — made many people wonder how some large sums had been allowed accumulate to such an extent. Then there was the claim, later denied, that tax bills or arrears in excess of five years were being dropped. We must restore public confidence in the fairness and effectiveness of the taxation system. That is one of our greatest challenges.

I referred earlier to the proposals of the Minister for Tourism and Transport in regard to the tourist industry, one of our principal growth areas. I was a member of the Council of Europe for a number of years when the significance of tourism worldwide was brought home to me. I discovered that many countries had not anything more to offer by way of tourism, if not much less, than ourselves. The Minister's quick action in the introduction of these alleviation measures is to be commended. My constituency offers massive potential for tourism development having some of the finest lakes and waterways in the country. Indeed, it offers enormous potential for cross-Border development. In our recent discussions with British MPs at Westminster it was amazing the emphasis they placed on the development of the North, the proposals they advanced, based mostly on tourism-related measures in the hope of attracting people there. In my county we have fisheries, water sports, cruising and, built up in recent years, equestrain centres, a number of golf clubs, people's parks and so on. I hope a substantial amount of money will be made available for such development from this international fund. For example, it would not be sufficient that three-quarters of such funding would go North with the remaining one-quarter to the five counties on the southern side of the Border. It would be important that there be the utmost co-operation between both sides, that some of the projects on which such money would be expended would be of a dual nature, which would transcend the frontier and embrace organisations, associations and communities on both sides. Such co-operation did take place in the expenditure of moneys from previous Border funds.

Other speakers contended we should concentrate on British tourists. I would have to agree they do constitute our immediate tourist market. Especially in the English midlands there is a considerable number of people interested principally in fishing, a solid group who come here and spend a substantial amount of money. They return annually to some areas in my constituency. We talked about the cheap fuel promotional scheme, which is a very good idea in this respect. Indeed, we talked about it in this House in the mid-seventies at the time the then Coalition Government hiked up the price of petrol. I was Opposition spokesman on tourism at that time. Such a cheap fuel scheme was one of our recommendations, the other being a reduction in the price of hotel accommodation and meals, in order to compete with the more aggressive foreign markets, with a diversion of extra resources into tourism generally. There appears to be evidence that the hotels and other promoters have sufficient confidence in the schemes now proposed by the Minister to act on them.

I listed earlier areas in which I saw potential development, such as tourism, afforestation and food processing. As has been said by previous speakers, in the tourist industry the most important area for potential is that of afforestation. Bearing in mind the drumlin soil of Leitrim, part of County Cavan, with a smaller portion of Monaghan, tests have shown that these areas have the highest potential growth in afforestation, probably in Europe, where some of the land is of a very poor quality. With so much surplus production within the EC, it should be remembered that timber is the one product of which member states have insufficient supplies and which will continue to be the position in future years. It is estimated there will be a 32 per cent increase in the shortfall in world timber supplies between the years 2000 and 2025.

There was mention earlier of the £600 million timber imports. What annoys me is that a number of years ago a report was published on the manufacture and processing of timber and it stated that by the year 2000 we would be self-sufficient and in a position to export timber. With the progress at present, strong action will have to be taken if we want to be in that position. The United Kingdom import 90 per cent of their wood requirements at present and they will only supply one-tenth of their needs by the end of this century. We should utilise our advantages — the soil and the climate. We have an annual growth rate in spruce, conifers and pine trees of 15 cubic metres per hectare as against 11 cubic metres per hectare in the UK and 2 cubic metres per hectare in the rest of Europe. That is an indication of the growth rate here. We can no longer sit on the fence. Marginal farmlands are an important part of the EC Commission's new proposal for agriculture. As I said in the House before, we will have to examine our usage of land generally.

There was very poor take-up of the grants for private afforestation although I notice from recent reports that the position has improved greatly in the past year or so. ACOT and the farm development offices should be involved in the promotion of afforestation because they have a lot to offer in that respect. Continually we complain in the Cavan-Monaghan region about the lack of timber processing plants. In the IDA report of 1982 it was indicated there was over-capacity in those areas for processing. There is no grant aid available but many of the processing plants were set up in areas where there was a lot of afforestation and there is a substantial amount of mature timber in those regions as a result of tree planting after the war years. That timber is being processed in South Fermanagh and is being returned to the South in plank form, and timber for pallets, for paling, posts and so on.

I hope the Minister will examine the position and will consider making available grant aid for the processing debarking and drying of timber. It is important to ensure that in the future the outflow of timber will not be as great from the areas I mentioned. We are not getting value for money. All that happens is that a number of people fell the timber and bring it to the roadway where it is loaded and brought to another area for processing.

In the counties which I represent there is a great tradition in footwear manufacture. I put down a question recently to the Taoiseach asking him about the imports of footwear for 1986 and its percentage on the Irish market. He said that imports of footwear were valued at £95.2 million in 1986 and that in terms of the footwear involved it was estimated that the import share of the domestic footwear market for that year was about 93 per cent. That represents about £27 for every man, woman and child in this country. It is food for thought. In Cavan and Monaghan there were more people employed in that line of manufacture after the war than in any other industry. Footwear manufacture was one of the main sources of employment in the fifties and sixties. At that time there was a very adaptable labour force but most of them have now moved to other areas and many of the factories are now used as stores for imported footwear.

We export between 90 per cent and 100 per cent of bovine hides. When I came to the Dáil in 1973 there were about 100 people employed in tanneries in County Monaghan and they were some of the last tanneries to close. That position should be remedied. As I mentioned earlier, the Fianna Fáil Party have made a positive approach towards import substitution in regard to fruit and vegetables.

Another item mentioned by a previous speaker was potatoes. During the years we have imported millions of pounds worth of potatoes per year. In a recent report by Henry W. Kehoe, a potato breeder at Oak Park Research Centre, there was a very interesting article on seed potatoes. He said:

Seed potatoes for export are one of the few agricultural commodities that can be expanded, provided we have a steady flow of new Irish-bred varieties. However, the area under seed potato production has declined from 6,500 hectares in 1964 to 3,300 hectares in 1983, while exports of seed potatoes have declined from 42,702 tonnes to 10,837 tonnes in the same period. Exports from Northern Ireland have consistently been much higher, and while they too have declined, they are still five times as great as from the Republic.

Before I came into the Dáil I was involved in the seed potato export business. At that time and since then, people in the North with very good land did not concentrate on cereal growing, milk and beef production the same as we did in the Republic. They retained their interest in and their share of the export market. That is regrettable for a number of reasons.

The Irish Potato Marketing Board are just ticking over because in commercial terms the tonnage of potatoes which they export does not justify their existence. They are highly subsidised and I hope they will be retained so that we can get back into potato production and, as this writer has said, avail of the market in that area. Mr. Kehoe also stated:

Several new seed export varieties bred at Oak Park are now available, for example, Cara Avondale and Red Cara. In 1984-1985 Cara made up 88 per cent of seed exports while King Edward and Arran Banner had declined ..."

He said it should be possible to reach the 1963 export figure of 53,000 tonnes within five or six years and that this would demand a greater commitment from all the agencies involved. We have the agencies and I hope the best use will be made of them.

Deputy Séamus Kirk has substantial proposals for the development of fruit and vegetable growing. In the past number of years I accompanied him on a number of visits to areas in the North and the South where potatoes, cabbages and tomatoes are grown under heat as well as various other crops, including apples grown in Kilkenny. We returned from those visits with the impression that Irish farmers are in a position to compete with any of their competitors in that field.

Since our joining the EC, farming has been divided into two sectors. Farmers in the first sector have developed their holdings and specialised in certain lines of production, using modern technology. These farmers are in a position to compete with farmers in most EC countries. They are in a position to show reasonable profits and to enjoy reasonable standards of living. Farmers in the second sector are confined mainly to the Connacht-Ulster region. The gap between the two sectors is becoming wider as the years go by. The Connacht-Ulster region is characterised by fragmented and uneconomic holdings. Much of the land there is marginal. Many farmers have inadequate cash to develop their farms and land usage is severely limited, limited to grazing or grass production.

Farmers in the first sector can fend for themselves but if attention is not given to the later sector during the next few years we will be faced with serious problems. Fianna Fáil's policy on the resource development of agri-tourism, afforestation and fruit and vegetable production will help to pick up the slack in this sector. The biggest knock farmers in the Connacht-Ulster region got was the curtailment in milk production. Many of those farmers were in the process of developing their farms when the super-levy was introduced. It had a very serious effect on them and it seems that this levy will continue for some time.

Close attention will have to be paid to store cattle and store cattle production. As a result of the super-levy the calf numbers in the EC are expected to decline seriously during the next number of years. It is estimated that calf numbers in the EC will decline by up to 2.5 million head or 9 per cent by 1990. Farmers and meat plant personnel will have to get together and modernise their systems of production and marketing. More attention will have to be paid to farmers providing cattle under contract so as to eliminate the fluctuating prices we had during the early months of this year when prices dropped by 4p or 5p per pound in any given week. This area of farming requires examination.

The actions taken by the Government during the past few months are already bearing fruit. The measures they have introduced will restore employment to many people and will improve the situation generally.

Mr. T. Fitzpatrick

In the course of my remarks on the budget I want to try to identify the budget because it does not seem to have parentage. It has been described by the Government as the Fine Gael or Coalition budget. A budget is not a budget until such time as it has been presented in this House and given approval on the day on which it is introduced. This is a Fianna Fáil budget introduced by the Fianna Fáil Government and presented to and given approval by the House on 31 March.

It is true that a considerable portion of this budget is similar to a draft budget put forward by the Fine Gael Party. It was open to the Government to change that budget, to write a brand new budget and introduce it here as their budget. The Government did not choose to do that; they accepted something like 80 per cent to 85 per cent at least of the Fine Gael draft budget. Therefore, we must examine and test the budget as a Government document representing the proposed policies of the Government.

I listened to Deputy Leonard's speech today and to the speeches of other Fianna Fáil Deputies during the past few weeks. They have talked much about the necessity for confidence and the way in which this budget will introduce confidence among business people. I do not think it will do any such thing. The budget will confuse business people and people in general. It will especially confuse and bewilder the supporters of Fianna Fáil and those who listened to their promises here during the past four years. It will bewilder the people who supported the Government at the polls on 17 February last and returned them to power on foot of the promises, most direct and implied, made by them not alone in the run up to the last general election but during the past two or three years in this House and throughout the country in local authorities, health boards and wherever a platform was afforded to them.

During the lifetime of the last Government Private Members' time in this House was taken up completely by the present Government, as was their right, in resisting every attempt made by the Government to put order into the finances of the country and in resisting every attempt made by the then Government to bring about economies and to get the people of the State to live within their means.

Debate adjourned.