It is necessary that the Parliamentary Secretary to the Minister for Posts and Telegraphs should get leave from the Seanad to attend, under Standing Order 46, to deal with this Bill. Is it agreed that Mr. Heffernan be permitted to attend?
Telephone Capital Bill, 1931 (Certified Money Bill)—Second Stage.
Cathaoirleach
Leave granted.
Question proposed: That the Bill be read a Second Time.
This is the third Telephone Capital Bill which has been introduced since the setting up of the Saorstát. The funds for telephone development as distinct from the moneys required for ordinary working and maintenance are provided by means of Telephone Acts. These Acts authorise the Minister for Finance to issue out of the Central Fund such sums, not to exceed a stipulated amount, as may be required for the development of the telephone system, in accordance with estimates which must have the prior sanction of the Department of Finance. The Minister for Finance, if he thinks fit, may raise necessary capital by means of terminable annuities of a period not exceeding twenty years. Under the previous Telephone Acts, a sum of £1,000,000 has already been provided. This sum was provided by means of two Acts, each authorising the issue of £500,000. One Act was passed in 1924 and the other was passed in 1927. The amount required under this Bill is £250,000 and there is still unexpended under the previous Acts a sum of £40,000. That amount, with the sum to be provided under this Bill, will, it is anticipated, suffice for the telephone capital requirements of the State for a period of four years or thereabouts. The sum of £1,000,000 already provided, covered the telephone expenditure for development purposes since 1922 and, therefore, the average annual expenditure was about £107,000. This rate, however, cannot be regarded as normal because it covered not only the exceptional extensions rendered necessary by the untelephoned condition of the country on the establishment of the Saorstát but provided for growth in congested city areas—work that must be done in bulk well ahead of the actual needs of the moment.
Perhaps it would be well that I should explain to the Seanad that considerable expenditure on telephone capital development was necessitated because of the obsolescent condition of the telephone plant on the taking over of the service by the Irish Free State Government. It will be recalled by those conversant with the telephone system in this country that the telephone installation originally belonged to the National Telephone Co. At the expiration of a certain period, the British Government had the right to take over the apparatus and plant of the National Telephone Co. under the licence by which the Company had been established. The consequence of that situation was that the National Telephone Company expended the least possible sum on maintenance and renewals and kept its systems working by many expedients of a temporary nature in the period immediately preceding the transfer to the British Government. The telephone system was acquired by the British Government in 1912. They immediately proceeded to reorganise it and to bring it up to date. But the Great War broke out in 1914 and the Government's energies were diverted. Telephone development and maintenance were neglected to a very considerable extent during the period of the Great War.
This applied, one might say, to an aggravated extent to the Free State, with the result that, following the close of the Great War and the subsequent internal disturbances here, the telephone plant that was handed over to us was practically the same plant that was handed over to the British Government by the National Telephone Co. and it was in an advanced state of obsolescence. Things were sufficiently bad at that stage, but then there were the further internal disturbances, in the course of which telephone plant was interfered with to a considerable extent, and renewals and repairs could not be carried out. At that period we had to face a situation in which all the important exchanges were obsolete and inefficient, the cables and conduits inadequate, and the trunk lines ineffective and inefficient. Little or no development had taken place in the rural areas, and many counties were without any service whatever. When the service was taken over by this administration, the situation was taken in hand energetically, and we are satisfied that the service has, in general, reached a high standard of efficiency, while no areas of real importance have been left uncovered. The expenditure necessary was in excess of requirements in normal circumstances, and in excess of what will be required in the future.
Members of the Seanad may wish to know how the money which was previously borrowed has been expended. I shall now indicate the major items of expenditure out of the £1000,000 authorised by the two Acts I have already mentioned. £70,000 was expended on the introduction of automatic telephones to Dublin; £3,000 on main underground schemes; £418,000 on local underground plants; £80,000 on new exchanges and call offices: £88,000 on overhead trunk lines and £190,000 on subscribers' lines. The following comparison of the position in 1922 and now will indicate more clearly what has been done: The number of exchanges existing in 1922 was 194; in 1931, 720. The number of call offices in 1922 was 552; in 1931, 1,257. The number of exchange lines in 1922 was 12,387; in 1931, 19,289. The number of stations—that is, the number of telephones in houses—in 1922 was 19,101; in 1931, 30,465. The number of telephone kiosks in 1922 was nil; in 1931, 14. As the Seanad will observe, there has been a very considerable increase in all the items mentioned by me. The Seanad may be particularly interested in the development which has taken place in Dublin —the extension of the automatic system to several of the Dublin exchanges, and the areas surrounding those exchanges. 6,381 subscribers are now connected with the new automatic exchanges at Merrion Street and Ship St. The system is highly efficient and has given general satisfaction. In connection with the conversion, under ground cables have been laid to provide wires for new subscribers for ten to fifteen years to come. Apart from the automatic extension, a large proportion of the amount previously borrowed has been spent on other extensions and other developments. In the areas outside Dublin, considerable improvements have taken place. In Limerick, a new manual exchange of the most modern type has been installed. Other extensions of an important nature have been carried out all over the country. Development has also taken place in Cork City.
As to future development policy, owing to the work already done there is no scope for any immediate, largescale extensions, and therefore capital expenditure will be substantially less than in the past. As to the automatic service, it is the intention that the whole of the Greater Dublin area shall be brought within the system, but existing manual exchanges will be maintained as long as they are capable of giving efficient service. Senators residing in Dublin area may be interested in the telephone conditions in Rathmines, Terenure and Drumconda. I have received complaints as to the inadequacy of the service in these areas and, to a certain extent, these complaints were founded on fact. Under this Bill money is to be provided to convert Rathmines and Terenure exchanges to the automatic system. In the meantime, a temporary relief exchange has been opened at Terenure. It will provide for all the temporary requirements of that area until a building necessary to contain the automatic exchange is erected. The Drumcondra exchange is also congested, but arrangements are being made under which it is hoped to meet all the requirements of that district for telephones within a few months.
As to the rural side of our development, projected developments in the provinces include the provision of additional trunk lines so as to give a nodelay service to the more important centres. The introduction of small automatic exchanges is contemplated for outlying areas, where the cost of manual service is prohibitive. This side of our development is, however, in the experimental stage and its practicability is not yet assured.
Senators may not be conversant with the system of book-keeping applicable to the Department of Posts and Telegraphs. In addition to the ordinary system of Government book-keeping, we issue periodically what are known as "commercial accounts." These commercial accounts are made out according to a system different from that prevailing in the ordinary Government Departments. They are prepared on the assumption that the Post Office is—as I think you will all agree that it ought to be—a business Department, working on commercial lines. These commercial accounts are issued about a year after the close of the financial year. According to our estimate of the balance on the commercial account for the past financial year—which accounts have not yet been issued, and will not be issued for some time—we believe that the telephone service has now been established on a self-supporting basis and is paying its way.
Could the Parliamentary Secretary give the relative figures for Dublin area for 1922 and 1931 ? I refer to the number of subscribers.
I have not got those figures.
I was interested in the description which the Parliamentary Secretary gave of his system of accounting, because I expected to hear what provision he was making for the repaying of this quarter of a million pounds. He has borrowed already £1,000,000 for capital expenditure in respect of telephones. He now wants a quarter of a million. This is to be raised by means of terminable annuities repayable within the next twenty years. I should like to know whether he provides anywhere in his system of accounting an account which would show that the general taxpayer is not the person to pay this money. I would be completely satisfied with any development of telephones provided it was shown to me that this development took place at the expense of users of telephones and not at the expense of the general taxpayer. I cannot see anywhere in the accounts nor could I gather from the statement of the Parliamentary Secretary that there is any account showing that this money which is being advanced and which is stated to be repayable in twenty years is to be repaid by telephone users.
I should like to ascertain from the Parliamentary Secretary whether or not there has been any success in the extension of the party line. Those who have been in Canada know that system well. There are a number of subscribers on one line. They can hear what the other subscribers say but, of course, they do not listen. In the country districts, it is the cheapest system. While welcoming the extension of the telephone system, I should like to voice a complaint which I have received. It is not a complaint by one individual but by a very large body of professional people who use the telephone. They complain of the unsatisfactory service. The parties who approached me have very heavy telephone communication with London. I will give you an instance of one individual whose quarterly bill amounts to about £80. So bad was the service in this case that this person has now to telegraph to London and get the call originated there instead of attempting to originate it here. In that way, the £80 goes to the British postal authorities instead of to the postal authorities here. If the call can be orignated promptly from the other side and cannot be originated promptly here, it would seem as if there was something radically wrong at this end. I shall give privately the Parliamentary Secretary particulars of that case. I do not want to mention names in the House. That is a matter which I think should be investigated.
I want to raise a question regarding the general policy for future development of the telephonic system. The Parliamentary Secretary has given figures relating to the State as a whole, which show that in 1931 there are 50 per cent. more subscribers than there were in 1922. I have no doubt that that is regarded as fairly satisfactory, but there is plenty of room for further improvement. Having expended the greater part of this £1,000,000 in providing the basis of telephonic communication, the aim in the future will be, I presume, to ensure that there will be a very big increase in the number of telephonic communications. In other words, having got the main lines and the general system in satisfactory working order, something will require to be done to increase the number of subscribers and to induce the people to use the telephone to a very much greater degree than it is being used. I was curious to know the relative figures for Dublin, because it seems to me the principal opportunity for rapid increase in the number of telephonic communications and telephone subscribers would be in the Dublin area. It is unfortunate for the business of telephoning that the number of private subscribers is not much higher than it is. The chief reason for that is, I think, the £5 a year rental. I make the suggestion, without having sufficient data for calculation, that a reduction of the rental would, in the Dublin area at all events, result in a very great increase in the number of subscribers. People without business connections who do not find it necessary to make many business calls find that their telephone costs amount to from 4d. to 7d. per call. That is because their usage of the telephone is limited by the number of business relations they have. In these cases, the relations of the people are more of a social than of a business character, and the fact that their neighbours and acquaintances are not on the telephone means that they cannot communicate with them. I think the aim of the Department should be to increase the number of telephones in private houses.
I think if it were possible, within the estimates made by auditors or actuaries, to reduce the basic charges it would encourage people to instal the telephone. The fact that a very large number of residents had the telephone would immediately lead to a great increase in the number of calls, and therefore to the revenue from calls. If that is not feasible at this stage, I suggest that the capital expenditure required in building and erecting a large number of kiosks in residential areas is worthy of consideration. I believe that if there was a kiosk to every thirty or forty houses within the region of the telephone system it would be a paying proposition. The fact that there was a telephone convenient would induce people to use the telephone to a very much greater extent than they do at present. That might be detrimental to the tramway service and, incidentally, to the telegraph service, but it would add to the convenience of the public, in the absence of individual telephones, and certainly to the income of the telephone department.
I said there was plenty of room for development. I was interested sufficiently to obtain, with the courtesy of the Department, some figures regarding the relative use of the telephone in various cities of the world. While it is true that there are some cities where the number of telephones per 100 of the population is lower than in Dublin, there are a considerable number of cities where telephone installations are greatly in excess of those in this city. I will take some extremes to begin with. The Dublin figure is 3.8 telephones per 100 of the population. To show that there are possibilities of very great advance in this respect, I next take Montreal where the figure is 18.9. In the case of Copenhagen—this is another instance besides the more frequently quoted one of agricultural cooperative progress in which Denmark leads the way—the figure is 16.8 telephones per 100 of the population. For Paris the figure is 11.9; Berlin, 11.4; Geneva, 14.6; and New York, 27. Those are very high figures. They are much the highest of the cities which I can quote. There are several in the region of five, six, seven and eight per 100 of the population, so that it is quite conceivable that we could, by a development policy, ensure a very much greater use of the telephone and a greatly increased number of installations, thereby achieving the double purpose of adding to the public convenience and of bringing the telephone service generally into a non-losing category: that would pay for itself, be no burden, and add greatly to the convenience of the public.
I have nothing to say against the Bill, of course, because I would like to see the telephone system developed. I do want to point out that the Dublin area, in my opinion, offers a field for very much greater development from the telephone finance point of view, while the public convenience will, perhaps, be more greatly served if one thinks of the development in the country areas.
Senator Sir John Keane asked the Parliamentary Secretary how the telephone party line system is working in this country, and pointed out that the system is used extensively in Canada. I want to tell the Senator that the party line system never got a chance to work here. The Parliamentary Secretary told us that we in the country could have the system for a charge of something like £4 10s. a year. A number of farmers in my district applied to have the system installed. When we got the estimate we found that it would be £19 10s. A number of people in the villages and towns throughout the country have been making applications and sending petitions to the Parliamentary Secretary during the last five years to have a telephone call office established in their areas for the convenience of the farmers. Nothing, however, has been done. Even the establishment of a call office in the villages and towns throughout the country that are without one at present would, I think, be a wise undertaking. The amount of money involved in carrying out such an extension would be well spent.
The Parliamentary Secretary told the House that the British Government took over the system from the National Telephone Company. He said that the telephones, when taken over, were in a rather obsolete condition, and that they had only two years to improve them and bring them up to date. Apparently that period was not enough, because they were interrupted again in 1914. Under the two Bills that the Parliamentary Secretary mentioned there were two loans of half a million each. He stated that the telephone system was now nearly on a paying basis. I take that to mean that in eight years the loans, though intended to cover a period of twenty years, have been repaid. That, I think, is very creditable. I would like to get from the Parliamentary Secretary figures giving the amount that had to be paid for the destruction of telephones throughout the country in 1921 and 1922. If we had that figure it might comfort Senator Comyn for the loss to the general taxpayer for whom he is so solicitous, because I think it was his Party that was largely responsible for putting that cost on the general taxpayer at the time.
The Banshee.
I like to comfort the Senator. He is solicitous for the general taxpayer. I am, too, and would like to know from the Parliamentary Secretary what was the amount of the losses sustained at that time by certain interference with communications generally. With regard to the quarter of a million that it is now sought to obtain, I would like to know how it is to be expended. Is it to be expended on new apparatus, or is it merely to meet the difference between revenue and capital expenditure? I would also like to know where the telephone apparatus is purchased. Is it a British product or Swedish? I imagine that most of the expenditure goes for labour and skilled work in extending and erecting the different exchanges, as well as on overhead and underground wiring. As far as the apparatus goes, I think no part of it is made in this country. Even the telephone poles have to be imported. I hope that when our Forestry Department gets properly under way it will be able to supply us with telephone poles. The creosoting process is not a very difficult one. It is astonishing to find, in travelling through England, that the millions of telephone poles along the Great North Road are imported. Surely there ought to be enough trees in one's own country to supply a need of this kind. I believe only 1½ per cent. of the land in this country is under forestry. Still there ought to be enough of Scotch fir to supply our needs in this respect, not necessarily poles of the finished decorative appearance of those in use. In France poles grown in the country are used. They present a rather unfinished appearance, but they last for 10 or 14 years. I think this is a matter that might be looked into both by the Forestry Department and the Department of Posts and Telegraphs. I know, of course, that it takes 21 years for a fir tree to grow to a height to enable it to be used for a telephone pole. There should be co-operation between the two Departments concerned to ensure that in future we will be able to supply our own needs in this respect.
I suggest to the Parliamentary Secretary that his Department might aim at least at having a telephone in every post office and every sub-post office. There are very many sub-post offices throughout the country without a telephone. It does seem a bit absurd to have places like a post office without one of the most modern and necessary means of communication. In many districts the only place in which one can have access to a public telephone is in a publichouse where there is no box and where, generally, it is difficult to hear and very inconvenient sometimes to convey your message. There is one anomaly in connection with the telephone system that I think requires some attention. A subscriber, no matter how big a subscriber he may be, who requires to have his telephone transferred from one premises to another, or even from one part of one premises to another, has to pay the cost of the removal. Recently I had occasion to change my office. I found that I would have to pay £5 or £6 for having the telephone changed, but I discovered that by applying for a new telephone I could get it installed free. Needless to say, I got in the new telephone. In order to get the old telephone changed I could get no guarantee that it would be done within three months, nor could I get a guarantee that I would continue to have the same telephone number. The new telephone was installed within a month. I got a new number which caused no great inconvenience. I think that, in the case of subscribers of long standing who want to change their business from one place to another, the Department might consider changing the old telephone free of cost to them, seeing that the subscriber can always have the work done free by becoming, as it were, a new subscriber.
I also have got a few strictures to make on the telephone system. I think that some of the rules taken over from the British act rather harshly on subscribers or possible subscribers and rather prevent a desired extension of the telephone system. I think the Parliamentary Secretary will admit that our telephone book is not a very large one. One of the reasons, I think, for that is that telephones are supplied at a fixed rate according to lineal measurement. I wish to mention two cases that were brought to my notice. One is that of a subscriber who lives across an arm of the sea from the distributing station. He has the telephone for something like £15 a year. The telephone wires had to be taken around a distance of five miles, or near it, to his residence. Another man who lives four miles along the road from the distributing station made an application for the installation of the telephone. He was told that in order to make a service to his house pay, the charge would have to be something like £30 odd, and that in addition he would have to get a couple more subscribers with himself.
I see, of course, the point the Parliamentary Secretary made in his statement that you have got to make these things pay their way. At the same time I am of opinion that if you stick to hide bound rules you are not going to get the rapid extension of the system that you expect. I agree with what Senator Dr. Gogarty said as regards encouraging the use of native grown poles. I think if applicants are willing to provide suitable poles which are passed by an inspector as likely to last for 20 or 30 years—if they are certified to last that length and there will be no increase in the cost of maintenance—their offer should be accepted. It would be one means of increasing this line of communication throughout the country.
I desire to support what is being said by other Senators with regard to extending the telephone system to country post offices. I know many villages that are not connected with the telephone system, the result being that the inhabitants and people of the surrounding districts are put to great inconvenience. A short time ago I had occasion to send an urgent call to the Civic Guard station. There is no telephone in the local village. The nearest village where there is a telephone is five miles distant from the Gárda station. The people over an area of six or eight miles have no means, if they need to do so, of communicating with the Guards. In this case I had to send a telegram which was delivered at a village five miles in the opposite direction to that in which the Guards are stationed. The telegram was handed in about 11 o'clock. It was 3 o'clock in the afternoon before the Guards arrived. It was well it was not a case of burglary, because if it had been, the thieves would have had plenty of time to take the booty and get away. If the telephone system could be extended and a telephone provided in every post office it would be a great convenience to the people throughout the country.
At the outset I want to assure Senator Comyn that the Minister for Finance takes care to see that money lent by the Department of Finance to the Department of Posts and Telegraphs is paid back. If the Senator turns to page 272 of the Estimates for the current year he will find the following items in Vote 62— Posts and Telegraphs: Sub-head M— annuities in respect of debt created under the Telegraph Acts, 1892-1921, and the Telephone Capital Acts, 1924-1927; M (1)—in respect of debt created under Telegraph Acts, 1892-1921, £16,253; M (2)—in respect of cost incurred since 1st April, 1922, £84,384. That is the amount which has to be repaid to the Department of Finance for the current year.
On a point of personal explanation, what I wanted to know was not whether the Department of Posts and Telegraphs are paying the Department of Finance out of the general revenue of that Department, but whether the users of telephones are paying the interest and sinking fund on this money which is being advanced under this Bill.
I stated that the telephone system was now on a paying basis. That means that all the charges applicable to the telephone system, including capital, interest charges, etc., are balanced by revenue. From that it is quite obvious that the charges, which the Senator is interested in, are repaid by the users of the telephone. With regard to the complaint made by Senator Sir John Keane in the matter of establishing a telephone connection between Dublin and London, I have not received any personal complaints. I am afraid I cannot deal with that now, but if the Senator or his friends have experienced any difficulty in that direction and are good enough to communicate with me privately, I will have the matter looked into. Senator Johnson spoke of a particular kind of telephone extension. The Senator's point, as I understand it, is that if we reduce our rate of charges we will get a considerably greater number of subscribers than we have at present, and that the revenue derived will compensate the Department for the additional expense incurred in making the extensions. That is an aspect of the telephone system which we have examined very carefully. We have examined it not only in the light of theory, but in the light of practice. The conclusion we have come to is that any further reduction in our rate of charges would not be justifiable is the existing circumstances and would not result in any appreciable increase in the number of users.
The rate of charges has been reduced since the telephone system was taken over by the Free State. In 1925 the rate was considerably reduced. At that time the annual charge to the ordinary householder in Dublin for the installation would, on the average, be about £7 10s. a year, plus call charges. That has since been reduced to £5 a year, plus call charges. I regret to say that the response to that reduction, so far as getting an increased number of users is concerned, has not been very great. On the question of theory, I might mention that there is a peculiarity about telephone conditions which makes it difficult to fix charges by means of an extension of the number of users. That is a position that is well understood, not only here but in other countries. With the permission of the Seanad, I will read a short extract from a statement I made in the Dáil in 1929 when dealing with the Estimate for this Department. The statement is really a paraphrase of a statement made previously by Sir Evelyn Wood, one of the highest officials in the Post Office Department on the other side. It also happens that a somewhat similar statement is made in this year's report of the American Telegraph and Telephone Company. The statement I want to refer to is as follows:—
Ordinarily, in an expanding business proportionately to expansion, expenses on the unit basis have a tendency to decrease as expansion takes place. This rule does not apply to the telephone services. Overhead expenses do not, of course, increase in the same proportion as the number of telephones. The cost of apparatus tends to fall. The savings effected on these are offset to a large extent, if not altogether, by the increased expense in cost of the plant necessary to provide ready means of communication between the increased number of users of the telephone. Exchange plant and staff increase out of proportion to the number of added subscribers. In effect the advantage which the user of the telephone gets from development and extension is not cheaper rates, but an increased service, i.e., a greater number of persons with whom he can talk.
That is the position with regard to a reduction in charges for the purpose of extending the telephone system. I might add that, in so far as it is possible for us to make comparisons between the charges we make and the charges countries somewhat similarly situated make, particularly under the British system, we find that our charges are somewhat lower. It is not possible to make exact comparisons, because the basis of charge in the different countries is not quite the same. Our charges in Dublin, for instance, when compared with the charges which operate in Manchester, Liverpool, and other big English cities, are somewhat more favourable. It is not possible to give a comparison of the charges made under Continental systems, for the reason that the basis on which the charges made here and on the Continent are not comparable.
Senator Johnson suggests, as an alternative, that if we do not see our way to reduce our rate of charges we should take steps to establish kiosks and connect them with the telephone system. We have established a number of kiosks—10 or 12. Our policy is to establish kiosks where we find a demand exists for them and where we think it will be a paying proposition to set them up. We set up one quite recently at the Cattle Market. Possibly Senator Counihan had something to do with that. A number of Senators referred to the party line system. With regard to the case mentioned by Senator Counihan, I cannot deal with that now. I do not know what charges were quoted. As a general rule we are prepared to quote a very low charge for the establishment of the party line system in a rural area. provided we get a sufficient number of subscribers, and provided that they are not scattered over too great a stretch of country very far away from the nearest exchange office. Our basic rate of charge is about £4 10s. We advertised the advantages of that system all over the country. Leaflets descriptive of the system were widely distributed through the post offices. The response that we got was very poor indeed. I think that we have only six party line systems in the country. I cannot tell the reason for that. Senators may perhaps guess the reason. It may be that as a race we are nervous of letting our neighbours know what we are talking about to another subscriber. One disadvantage of the system is that if our neighbours lift the receiver they can hear what we are talking about to a third party.
I believe one of the favourite forms of amusement with lady farmers in Western Canada is to listen to their neighbours talking over the party line system. Apparently they do not mind that out there, because they have a great number of party lines in Canada. The position here, at any rate, is that the system has not taken on. Of course, we would like to provide Senator Counihan, and other Senators who live in the rural areas with telephones, but if Senators and other members of the public like to have manorial residences far out in the seclusion of a rural area and far away from the local post office and telephone exchange, then that is going to cost them a considerable amount of money. If these people will not bear the cost of a telephone system provided for them under such circumstances, then the taxpayer will have to bear it. If we were to give a Senator living in a rural area a telephone service for £10 a year, a service that was costing the Department £20 a year to provide, then that particular subscriber is simply getting a subsidy at the expense of the taxpayer to the extent of £10 a year. Knowing the individualistic and non-socialistic tendencies of the Senator, I am certain he would be very slow to ask the taxpayer to pay any portion of the cost of giving him a telephone.
I think the Parliamentary Secretary might now get away from that. He has stated again that the party line system was advertised at £4 10s. 0d. to subscribers where a sufficient number applied. I have mentioned a case where six people made application and where the rent was quoted at £19 10s.
Is the Senator sure that this is a party line system?
It is.
I do not know the special case the Senator has referred to, but I think the Senator will find that these people live a very considerable distance away from the nearest exchange office.
About 3½ miles.
I cannot deal with the special case submitted, because I have not the information in front of me. I did not quite follow Senator Gogarty's inquiries with regard to the repayment of loans. Perhaps, I have answered his point in the course of my answer to the remarks of Senator Counihan. We are, of course, repaying our loans, and I may say that, of the £1,000,000 borrowed, we owe only £40,000. The Senator made a point about the difference between capital and revenue. The answer I will give in that connection is that in so far as we are installing new apparatus it is charged to capital, but in so far as we are renewing existing apparatus it is charged to revenue. The Senator was also very interested in the question of the materials used. He asked me what nation provided the particular telephone apparatus that we have installed. As far as I understand, and I am speaking without very full information, most of our existing apparatus has been provided by British Companies. I think it is provided on a competitive system. The Contracts Committee control the buying of it, and I think it will be found that the buying is arranged on a satisfactory basis.
With regard to the use of Irish timber for telephone poles, I am not sure whether we have as yet used any Irish timber, nor am I quite sure if Irish timber is suitable. We are importing our telephone poles uncreosoted, and we get them creosoted in the Irish Free State. One of the main requirements of telephone poles is that they shall last as long as possible. That, of course, helps to reduce the maintenance expenses. The wood must be of a suitable kind, and of a lasting nature. I am not sure whether the Irish wood that is available is of that kind. I know that in other countries, such as France, they use a cheaper and an inferior pole to the poles we use. I am not sure that is a satisfactory system. We have inherited the British system in regard to our telephones. We are installing the very best poles, and that helps to make the service a satisfactory service. I do not want to cast any reflections on the French system, but I have heard that it is not as good as other systems. One reason is that the poles they use are not as good as they ought to be. We are using as much Irish material as we can. The cross pieces are made of Irish oak. We find that we can get Irish timber of a suitable kind for the cross pieces.
Senators O'Farrell, The McGillicuddy of the Reeks, and others raised questions with regard to the installation of the telephone in every post office. I presume they mean the establishment of a call office in each post office. Again it is a question of cost and revenue. We are not allowed by the controlling regulations made by the Department of Finance to establish a telephone call office if it is estimated the establishment will result in a loss to revenue. No matter how great the humanitarian considerations are, we cannot establish telephone exchanges or call offices at a loss that would have to be borne by the taxpayer. Our post office being regarded as a commercial department our object is to make it pay for itself, and we endeavour to work it on a commercial basis. If it were thought by the Oireachtas that it would be advisable to establish call offices, a new policy would be developed whereby the taxpayer would become responsible for portion of the cost. As a matter of fact, up to the present year the telephones have been working at a loss, but we are reaching a point when there will not be any loss in that respect. I think I have dealt with all the points that have been raised by Senators.
Question put and agreed to.
Committee Stage fixed for Wednesday, 6th of May.