Would I be in order in speaking on this Bill at this stage?
Private Business. - Bank of Ireland Bill, 1929—Fifth Stage.
Question proposed: That the Bank of Ireland Bill, 1929, be received for final consideration and do now pass.
Cathaoirleach
Yes, on the general principle of the Bill as it is before the House. There are certain things that I cannot allow the Senator to say on it, but I can allow him to say a good many things.
As I was one of the main opponents of this Bill in its earlier stages, I feel it is only right that I should say a few words before it passes its final stage. In the early stages of this Bill I ventured to criticise some of the provisions contained in it. I suffered a good deal of adverse criticism, personally, for daring to suggest that anything in the Bill could be improved on. It was said that there was no reason behind the objections that I made to the Bill. I am glad to say that, when the Bill went before the Joint Committee that was set up to consider it, that not only the Committee, but the directors of the Bank of Ireland particularly, saw that there were certain amendments suggested to it which were reasonable, and to which they offered no objection. The amendments made to the Bill in Committee, in the main, satisfy me. The main issue involved in the objections that I made to the Bill was to prevent anything in the nature of foreign control operating in any of our main banking institutions here. The Bank of Ireland have accepted amendments to meet the objections that I put up on earlier stages of the Bill. I would like to say that, personally, I appreciate, not only the method of their acceptance, but the spirit in which they were accepted. Perhaps I should go a little further and express the hope that if, in future, banking legislation becomes necessary, a like spirit of give and take will be shown by the Bank of Ireland. I have no doubt but it will.
While I have no further objection to the Bill in its present form. I would not like it to be inferred that I am in any sense satisfied with the existing conditions that prevail as regards banking in this country. I feel, first of all, that the rate of interest charged is unduly high on both agricultural and manufacturing industries. That is one of the big problems that will face us in the future: how we shall be able to secure adequate resources to administer our agricultural and manufacturing industries at an economic rate so that it will be possible to carry on industry here. That is one feature in connection with our banking system that has developed in an acute form since we last discussed this Bill here. I suggest that it emphasises and shows clearly the dangers involved in our present position. There has not been anything in the way of revolutionary development in industry, either from the point of view of manufacture or in any other way, in this country, and yet we find that we are at present suffering from the imposition of an increased bank rate through no fault or through no activity of ours. That has come to us, not even from the administration of the banking system across the water, but purely as a result of speculative activity in New York. That is one of the anomalies that I see in our present banking system. It is not for me, at this stage, to say how it is going to be overcome. I did argue, on the First Stage of this Bill, that the cost of money in this country bore no relation to the ordinary law of supply and demand. On that stage of the Bill I pointed to the tremendous amount of export capital that we had going out of this country, as well as to the tremendous expense the country had to bear, including our Minister for Finance, in raising loans outside the country. I still feel that this is an issue which will have to be met sooner or later. The position is, that we have to pay an abnormal and an unreasonably high rate of interest for such money as is required for the running of the Government and of the country, while these available resources which are the property of the citizens of this State are, through the medium of the banks, being exported from the country. There is another point that, if in order, I would like to mention. It is this: that it does not seem to have penetrated the minds of bank directors in this country that, in the main, we are carrying the old overdrafts—moneys which were loaned or required at the period of highest inflation in this country. That applies particularly to land. I suggest to the bankers of this country—I feel that, following the attitude they have shown in regard to this Bill, they may perhaps consider the suggestion in a reasonable spirit—that the banks here are carrying this inflated figure in most of their overdraft arrangements at a period when deflation has taken place. Banking is the one business in the world that I know of that has not written down its stock to anything like its present-day value. All of us know that throughout the country there are industries, whether they be farms or manufacturing businesses, which are saddled with these old loans contracted at a time when values were entirely different to what they are to-day. I suggest that there can be no reasonable hope of real prosperity in the country until our bankers adjust their overdrafts and their balance-sheet figures, in the shape of their ledger accounts, to present-day values.
What about the deposits?
I am dealing with overdrafts and loans given by the banks. We will speak of the deposits later, perhaps. At the moment, that is the position. We know there are farms having overdrafts of £6,000 and £7,000, and that if these farms were put on the market they would not realise more than £2,000 or £3,000. That is a regrettable state of affairs. I doubt very much if it is good banking policy, or if it is, in any sense, good business for the banks to continue to carry on on that basis. It may be that if the figures were adjusted farms that are uneconomic at present would become economic, and that in the long run the banks would have good accounts instead of having to write off ultimately bad debts. One other point I want to mention, and it is in the nature of a grievance, perhaps: When the Committee was being set up to consider this Bill, for some reason or another two of the proposed members of the Committee were barred.
Cathaoirleach
Did the Senator make any objection on that point when the Committee was being formed?
I made an objection.
I personally did not make an objection.
Cathaoirleach
The Senator would not be in order in dealing with that matter now.
I bow to your ruling. I appreciate, as I say, the spirit in which the banking directors met the various arguments put up in regard to the Bill. So far as the Bill is concerned, my immediate concern was to prevent foreign control in this country. That is a menace that exists, and it has been prevented in this Bill. It is a growing menace. The next steps that will be taken by international bankers will be to control the finances of the world, and they are under way, We want, as far as possible, to preserve our own institutions and run them for our own welfare.
Motion put and agreed to.