The general object of this Bill is to protect native manufactures from being dominated by foreign capital and foreign control. The danger in consequence of foreigners seeking to establish manufactures in this country, as a means of evading tariffs, will be obvious to the whole House. This type of legislation, if not common, is at least exercised in many countries similarly placed to this country or even in a better position than we are. I would like to make it clear that the Bill is not meant to discourage indiscriminately the use of foreign capital or the establishment of foreign manufactures here. It is directed to the reasonable protection of native manufactures. There is no prohibition of any manufactures where more than half the invested capital is owned by our own nationals, and, even in cases where this condition is not fulfilled, licences can be granted for manufacture to any groups at the discretion of the Minister. Such licences will be granted where the Minister is satisfied that, having regard to the terms and conditions therein, the proposed manufacture will not endanger native manufactures. When once granted, a licence is, with some exceptions, irrevocable. Further, the Bill contains certain provisions in favour of manufactures, whether native or foreign existing before the passing of the Bill. The provisions of the Bill define what is a national for the purpose of the Bill, and what would constitute nationals for securing such licence as will be granted by the Minister. We all know that there is rather an anomalous position with regard to nationals in this country and it will be essential very soon to bring in certain legislation defining definitely what are nationals and the whole basis of citizenship here. In the meantime, in this measure a national has been defined by sub-section (2) of Section 1 of the definitions as (a) a person born in Saorstát Eireann or the area now comprised in Saorstát Eireann and (b) a person who at the relevant time is and for not less than seven consecutive years immediately preceding that time has been resident in Saorstát Eireann.
Control of Manufactures Bill, 1932—Second Stage.
Would the Minister say what exactly the phrase, "or the area now comprised in Saorstát Eireann" means? If he is not clear about it, I do not want to press him.
Personally, I think the addendum to that clause (a) of sub-section (2) is quite unnecessary, and I do not know exactly what the draftsman had in mind when he included it. To me the first portion is adequate.
I could not understand what it meant. That is why I asked.
You generally find that there is a legal reason for putting such a phrase in, but, personally, I am not aware of the particular reason in this case.
Possibly, at a later stage, the Minister will look into it and let us know.
I can investigate what it is, but I am satisfied that there is a legal reason for it. Section 2 deals with restrictions and defines the various possibilities in regard to the control of operations. Clause (a) deals with individuals and clause (b) with partnerships and (c) with companies or bodies corporate, and the definitions, I think, are clear-cut in each case. This section, I may say, caused quite a considerable amount of discussion in the Executive, and I interested myself personally in this particular section, and I think the definitions are as clearly worked out as possible to avoid any anomalies or pitfalls. Sub-section (d) of Section 2 makes it quite clear that this Act will not apply to any businesses that have been established prior to the 1st June, 1932, that is to say, all concerns, individual or otherwise, that have been in operation in the manufacturing line before the 1st June, 1932 are free of any restrictions. It is to be remembered that this Bill entirely deals with manufactures and the development of industries, and in no sense covers the distributing trade, nor does it interfere in any way with the purely distributing trade. Paragraphs (g) and (h) deal with the possibilities of a business where a death has occurred or where bankruptcy has occurred and where the businesses are being lawfully carried on, and they provide for the lawful continuation of the business until the administration, bankruptcy, etc., is completed.
This is merely to ensure that there will be no dislocation of business pending the administration of an estate. In the event of the death of the owner of or a substantial partner in a business where the legatee is not a person of Irish birth or citizenship, the business might be considered not to be fully complying with the terms of the Act, but until the administration has been completed or the legal formalities complied with, the business will not be interfered with but will be allowed to continue. There has been a good deal of discussion, or inquiry at all events, about the term "adapt for sale," and this is expressly defined as including the important operations of packing, bottling and labelling for sale. That means simply that it does not constitute any portion of the manufacture of the commodities. There has been discussion in the Dáil as to whether the Bill should apply only to wholesale operations. This matter has been fully considered by the Department. It is considered that retail operations can, having regard to the general objects of the Bill, only be excluded in the cases of packing, bottling and labelling, and then only when done by the retailer who intends to sell the articles retail.
As to Section 5, there is likely to be criticism on the ground that the Minister is given complete discretion as to granting licences and inserting any terms or conditions that he thinks fit and because the Bill lays down no principles to guide the Minister's discretion. It will be remembered, however, that the Minister said that he must have complete discretion in all the circumstances. The circumstances of persons or companies applying for licences may be so diverse and the protection required for native companies so varied in different circumstances, that it is considered impracticable to lay down any principle to cover all the possibilities. Owing to the difficulties that may arise in various concerns, and all the peculiar circumstances that will have to be taken into account, it is almost impossible in a Bill of this kind to cover all sorts of possibilities. For that reason, it is felt that in this measure the final discretion of the Minister is the only guiding thing. Of course, when we speak of the Minister, it simply means that the matter will have to go, in most cases, to the Executive Council.
Section 7 provides that, on change of the ownership of business in respect of which a licence has been granted, the new owner shall, on application, be entitled to a transfer of the licence unless there are conditions to the contrary in the licence. It may be observed that there will usually, I think, be conditions to prevent the licence "going with the business." I think it will usually be the case that on a change of ownership of a business, the question of whether a new licence is required, or will be granted, will be considered de novo as under Section 2. The reasons for that will be obvious, because thé business might carry a vested interest in the licence, and a series of circumstances might arise where a transfer of a business, effected by sale or otherwise, might, in essence, defeat the whole object of the Bill. The main object of Section 8 is to provide against any contention that a licence is in force, on the revival of a business after being discontinued for some time; that is to say, that the matter would have to be reviewed entirely in the new and the consideration of a new licence would be covered by the Act.
Section 9 is protective to those who get a licence. The main object in the section is to provide that a licence shall be irrevocable except in the cases mentioned in the first two sub-sections. The object of Section 10 is to enable the Minister to acquire information, in the case of corporations and in the case of individuals, necessary for determining whether the body or person is legally carrying on a manufacture under the Act. It may be argued that the section creates an obligation on persons to give information which may be used for the purpose of prosecuting themselves; but the information is such that the Minister would have unreasonable difficulty in procuring it in any other way. Those points I think cover the various sections of the Bill.
As to the purpose of the Bill, I think the attitude of the Executive Council is well known. It is felt that many of our industries and manufactures are carried on under considerable difficulties and have been carried on under considerable difficulties for some time. With the introduction of tariffs and a protected market, it is thought to be unwise to leave our manufacturers, who have been carrying on under these difficulties, and who may now have a chance of developing, at the mercy of the big concerns, the big trusts and big combines. For that reason, it is felt to be essential that the fullest possible protection should be afforded to the nationals engaged in these industries. We feel it is fundamental that the country should not be at the mercy of exploiters or big mass companies who would squeeze out the home manufacturer and possibly crush the industry out of existence and then be in control either of the import or manufacture of the goods. That is the main purpose of the Bill.
It is in keeping with our general lines of policy as regards the protection of our own citizens. In the circumstances, I feel that the Bill is in every way justified. On the whole, the Bill met with a favourable reception, and all Parties were convinced that it was a necessary measure for the protection of our people and for the protection of our manufacturers within the State. For that reason, I hope the Seanad will approve of what we have done in trying to afford this protection.
This Bill deals with one of the most difficult problems with which a small country has to deal. It is one that requires the greatest amount of care in its operation, and the whole problem requires very careful examination. I am quite satisfied that the present Minister, who is dealing with it, appreciates most, if not all, the difficulties involved. I am not sure, however, that the whole Executive, as such, fully appreciate the dangers that may exist in a Bill of this kind, if it is not very carefully worded, and if the provisions are not of the most carefully thought out character. The Bill involves two principles, one of which I have a great deal of sympathy with, and one of which I am completely opposed to. It is called the Control of Manufactures Bill. It involves two things. It involves an attempt to provide that manufactures in this country shall be under the control of nationals of this country. That, in principle, I am not opposed to. I think there is a great deal to be said for it and I do not want to be taken as opposing it. The other portion of the Bill deals with Government control of manufactures and gives unlimited power to the Executive, whether it be this Executive or another Executive, through the Minister, to give licences, without any definition at all as to what are to be the reasons or the lines governing the granting of such licences, to persons who may not come under this Bill. I think that principle wants very careful consideration before this House should approve of it.
I do not believe in making vague suggestions of corruption. Nothing that I am saying now is intended to suggest anything of the kind. I think that we may be proud of one fact emerging from the ten years' existence of this State. Whatever we may think about the politics of the Ministers of the last Executive Council or the present Executive Council, I do not think there is anybody who has at the back of his mind, or in any way thinks, that there is the slightest danger of individual corruption. But this Bill is not meant for the next six months; it is meant for all time. Once the principles of this Bill are laid down, they will be very difficult substantially to change.
I think the whole question as to the way in which licences may be granted to combines or persons outside who will not be under the full control of this country is one that requires detailed consideration by experts. It should only be adopted after it has been very carefully considered. I think the Bill either ought to set down the general lines upon which such licences should be granted or, if that is found impracticable—and I recognise what the Minister said as to the difficulties in each case—the general lines should be set out by orders made by the Executive and these should be subject to annulment after submission to the Oireachtas. Personally, I would prefer the setting up of some body independent in its functions which would make such orders and which would be subject to the control of this House, but not subject to the charge that it was acting in the interests of any political party.
That deals generally with what seem to me to be the two objects of the Bill. I am sorry that in dealing with the second object the Government have found it necessary to introduce this principle of State control and Executive power to give these licences. I think that is a very dangerous principle indeed. To my mind this is the kind of Bill for which a Second Chamber exists. I think it would be very desirable if this House could see its way to set up a Select Committee of, say, seven or eight representative members, to go into the details of this measure. I am not suggesting they should deal with the general principles, because they must be dealt with in the House, but I do suggest they might go into the details of the Bill and see where the dangers lie. The Minister has stated that it is the present intention of the Government not to interfere in any way with existing companies. That, I think, is very wise, but I am not at all certain that a careful examination of the Bill will not show that it does so, though probably not intending to do so. That is a matter that will have to be carefully examined.
So far as we can see we are going to have a very difficult period in this country. I should like to say that, whatever you do, you should not do anything that is going to make it difficult for any existing manufacturer to carry on or to adapt his business to the circumstances in which he may find himself in the very near future. Do not place him in the position, if he is at present working here and employing people, that suddenly he may find, because of the provisions of this Bill, he will have to look for a licence. This Bill provides that existing companies, and I am dealing for the moment only with existing companies, may carry on what was their ordinary business on 1st June. It gives you no definition of what is their ordinary business. I think I am right in stating that a suggestion was made, but not accepted, that a limited company should be allowed to do any business defined in its articles of association. I think the Bill should provide that existing manufacturers who have been here before 1st June should be allowed to do anything which their articles of association give them power to do.
One does not like to appear to be making unpleasant prophecies of what may happen in the next few months, but I can see some manufacturers finding it necessary to adapt their machinery and their trade to meet in detail demands in this country which they are not meeting at the present time. I know of some firms that are dependent almost entirely on their British trade. If they lose that and if they are to carry on, they must take steps to adapt themselves, possibly by making other goods, to the trade here. Under this Bill they will not be able to do that unless they take steps to find out the nationality of every single shareholder. That, in the case of a public company, is going to be a difficult and troublesome thing. Public companies will have to do that and if they find out that the majority of their shareholders come under this definition of nationals they can make the change. If they find the shareholders do not come under that heading they will have to look for a licence. A good many manufacturers are extremely chary of coming under this provision with regard to a licence. Some of these reasons may seem unreasonable, but I suggest some of them are perfectly reasonable.
The Minister has stated that as a general rule the Government do not want to set up the principle that a licence will be transferred to a new owner. What will that mean in the case of an existing company? Let us take it that money has been invested in an industry by a number of shareholders. They put their money into it in the belief that if they found it necessary to withdraw their money the business might be sold or transferred to someone else. They took the risk of putting their money into it, and they believed when they did so that there was an actual asset which could be transferred or otherwise disposed of. Under this Bill, if they keep strictly to the ordinary line of manufacture, they will be allowed to continue, but if they change in one iota from what they were accustomed to make or from their general line of business—whatever that means—on June 1st, then they will come under the licence system. The licence may not be renewed if there is a change of ownership, and what is a tangible asset at the moment may become a very problematical one.
Unless this Bill is altered and amended, existing companies will be very chary is making changes which it may become highly desirable they should make if they are going to keep their employees working. I believe it is necessary to make alterations in this measure in that connection. I think it can be done by giving companies full power to act within the powers they have—in the case of limited companies—in their articles of association. In the case of companies which are not limited some other provision may be made, but for the moment I am not able to suggest what provision could be made. However, I feel quite sure a way could be found out. If a number of heads were put together I feel certain a way could be found of dealing with this matter.
I do say it is a serious problem and one which ought not to be allowed to pass without being carefully considered. I asked the Minister for Posts and Telegraphs as to the meaning of the words "a person born in Saorstát Eireann or the area now comprised in Saorstát Eireann," because I did not understand what those words meant and I desired to deal with the possibilities arising out of the phrase. If Senators look at the Constitution or the Treaty, they will find that there was one year in which there was a considerably larger area known as "Saorstát Eireann" than in any other year. It seemed to me that a person who was fortunate enough to be born in one of the northern counties in that particular year might be regarded as a national here, whereas if he had been born the year after he would not, under this provision, be a national. I do not quite know what the phrase means. The reason I interrupted the Minister was because I intended making a speech and I wanted to find out what was in his mind. The Minister does not know exactly what the reason for this wording is and I am not surprised. He did make clear that his idea of the meaning was "Saorstát Eireann" as we know it now. With that I disagree. I think that a man who was born in the Six Counties and who is willing to put his money into industry in the Free State ought to be allowed to do so. I think he should not be required to come down and have seven years' residence before he can enter into industry here. I would go as far as to say that I wish everybody in the Six Counties had money invested in the Free State. I have a strong suspicion that our political difficulties would be considerably lessened, if they did not disappear altogether, if that were to happen. I can see an argument, from the point of view of this Bill, against qualification by seven years' residence in the Six Counties, but I can see no argument against allowing a person born in the Six Counties to come in here and be regarded for the purpose of this Bill as a national. That is a matter that should be remedied in the Bill. I am not suggesting that a person who has lived for seven years in the Six Counties should qualify under the residence clause, but any person born in Ireland should, I think, be qualified under that clause.
The Bill does not define the meaning of the word "residence." I am not a lawyer but I know sufficient to be aware that the lawyers are unable to say, except in regard to particular circumstances, what "residence" means. If you define a "national" for the purpose of this Bill, you will have to define "residence" for the purpose of the Bill. Otherwise, people may, in perfectly good faith, start business here, believing they are residents, but in one or two years' time they may find the Court deciding that because of certain temporary absences they were not residents. I think that in Committee we should have a very clear definition of the word "residence" inserted. Otherwise, I think the Bill will be unworkable.
There is no provision that I can understand in this Bill which deals with the case of a corporate body holding shares. An existing public company which desires to change its line of business will require a licence. To do that, it must be in a position to state to the Minister the position of each of the shareholders. The secretary may write to the shareholders. If one of those shareholders makes a false statement, the company is liable to a heavy fine. That may not be so important, but the company may also find that it has lost its licence because it made a false statement, due to the statement made by the shareholder over whom it has no control. That difficulty requires attention. Some way must be provided by which the secretary of a company can find out the nationality of his shareholders. Some protection must also be afforded to him, because, as the Bill stands, the duty is on him to find out beyond yea or nay the residence or nationality of each shareholder of the company. It is almost certain that, in the case of a public company, when the secretary goes through the list of shareholders, he will find the name of a bank or the names of banks. We all know that, for the purpose of security, shares in many cases have to be transferred in the names of banks. That does not mean that they are the property of the banks. They are the property of the transferor but, for the purpose of cover, they have to be put in the name of the bank.
I want to know how the secretary of a company is to decide who the owner is. The banks do not disclose that information. There is no provision under this Bill by which the banks are to make such a disclosure. Is the bank to be taken as a national or has the secretary to go and ask the bank to supply him with a list of its shareholders so that he can find out the nationality of the bank from the point of view of this Bill? Then, again, the institution concerned may not be a bank. It may be a holding company. Some of the companies here may find it advantageous—under the new provisions with regard to excess profits duty the tendency will be, I think, to make it more general—to form subsidiary or holding companies to start new industries here. I know one or two companies who have been seriously considering that. How is the nationality of the holding company to be decided? Must the secretary write to that company and get them to state the nationality of the holders of their shares and whether 51 per cent. are nationals? Again, what proof have you of the nationality of the holder except his own statement? That difficulty could be got over by providing that the statement of the shareholder will be sufficient, but it is not dealt with in the Bill. There is a very grave danger that companies may come to a standstill or find themselves unable to function because of a lack of provision in this respect.
Another difficulty arises. For the sake of argument, let us assume that there is a public company in existence 51 per cent. of whose shareholders are nationals under this Bill. If that is a public company, the directors have no option under the Companies' Acts but to transfer a share if somebody buys it. In a private company, the articles usually provide for the exercise of a discretion by the directors. They may refuse to transfer a share but in the case of a public company they have no such discretion. A company which, under this Bill, would be a national company to-day may, because one of its shareholders dies and transfers two or three shares to non-nationals, cease to be a national company. Under this Bill, if they manufacture anything until they get a licence, they are subject to very heavy fines, increasing by £10 per day. It might conceivably happen that because of the purchase of one share or a larger number of shares, the works would have to be closed down until a licence was issued. No doubt, some way can be got to deal with that point it is not dealt with in the Bill and it requires to be dealt with.
Under Section 10, a large number of questions are to be put to existing companies. If existing companies are to be left in their present position, I do not see the need for so many questions. The answer to a number of the questions set down could be easily ascertained by referring to the register in the Companies' Office. Any of us who have anything to do with public companies know that the present law is very troublesome. If a director happens to change his address, you have got to make a special return, pay 5/- for a stamp and get the change registered immediately in the Companies' Office. Each year you have got to give a return of all changes and transfers. There is no need to put the extra trouble and expense on small companies of again answering a number of the questions under Section 10. Where the information can be obtained in the Companies' Office it should be obtained there and questions referring to matters on which information can be obtained there should be excluded from Section 10. The only question, to my mind, which ought to be put to an existing company is one which will prove whether or not they are a national company under this Act. In answering that question, some provision must be made as to the proof required. That proof, at present, cannot be afforded by sending out a letter to shareholders, because you have to guarantee the information as to the birthplace or place of residence of the shareholders, and you do not know what "residence" means. The position will be extremely difficult for companies, and will make it difficult for existing companies to carry on and provide employment. It is going to be difficult enough, and do not add to difficulties of this kind by legal points.
This Bill, as pointed out by the Minister, only deals, and only intends to deal, with manufacturers. It does not deal at all with the retail or distribution trade or it does not intend to, but, as a matter of fact, I think I will be able to show that it does inadvertently affect it in ways which I am perfectly certain were not intended. I shall return to that in a moment. I am inclined to think that if there was need for control of this kind it existed in the distribution trade much more than in the manufacturing trade.
We all know that at the present time a large number of distributing companies have come over here to the Free State and opened branches. They employ very few highly-paid people; they employ only assistants. They can defeat a small tariff by the fact that they can buy in enormous quantities for their 200 or 300 branches, two or three of which only may be here. This Bill is not intended to deal with them. I can see the difficulties and I am not criticising the Minister for not dealing with them. These companies expend very little money in the country. Most of them do not even bank here, I am informed, and they can easily get out if they wish. On the other hand the outsider who has the courage to come in here and to put his money into a factory or machinery cannot get out so easily. There is much less objection, in my opinion, to his coming in here provided the country is not already adequately supplied with manufacturers in his particular line. There is much less objection to his coming in here than there is to a distributor coming in. The distributor can undoubtedly defeat the position of our manufacturers by the fact that he can order enormous quantities for his trade outside as well as here and can get them at far lower prices.
As to the exact effect of the Bill on retailers, the Minister said that this had been considered in the Dáil and it had been decided to exempt packing and bottling. In my trade, if a lady comes in to buy a coat she very often wants it reduced in size by an inch or two inches or she very often wants some slight alteration made. If a company wishes to adapt for sale any article or make any alteration to the extent that is necessary for their trade, they have first to find out whether they come under the Act. They must find out whether their shares are owned as to 51 per cent. by nationals and if not, they must not do anything that is not in the course of their retail trade. I am rather jealous of the people in the packing and bottling trade, and I think there are other people who should be allowed some consideration. That provision does not affect me personally because my firm is entirely Irish-owned, but there are other firms which might be seriously affected. I suggest the Minister should give that aspect of the case very careful consideration and examination.
There is another matter which has to be dealt with. It sometimes is found necessary, sometimes for unfortunate reasons, sometimes for excellent reasons, to reconstruct a company. Will the reconstructed company be a new company under the Act if it is a company carrying on business before 1st June? If the reconstruction does not make any change in the ownership I think it should be treated as an old company. Provision should be made to deal with a case of that kind but I cannot find it in the Bill. Again, take the case of a manufacturing concern, a partnership, a case such as I know at present. It is a case in which a difficulty might arise because there is a slight majority of foreign capital though in this case the control is entirely in Irish hands. This particular concern wishes to add to its capital in order to increase the quantity of goods it is manufacturing. There is the difficulty that people who might put more capital into it have said "You must become a limited company." They cannot now become a limited company before 1st June. They will have to become a limited company in order to get extra capital and they will have to look for a licence under this Bill. Rightly or wrongly the people with the capital are chary of the fact that a licence will have to be applied for, probably because they feel that if the concern comes to be transferred to another owner, after they get the licence, they may lose it or the licence may be withdrawn for any breach of its provisions, which might easily be accidental. They feel that if there is a change in partnership, the value of the concern will be reduced considerably. I think a great many of these things could be put right in the Bill if six or eight business men in this House got together and went into it with the assistance of the draftsman. It is not easy to draft amendments to put these matters right. I have gone into most of these things and I have read the Bill very carefully. These are the things that strike me, but frankly I do not know how I should draft amendments to meet them. It is most difficult indeed. I think these are the principal lines of difficulty in the Bill.
On principle, I would urge that, preferably, there should be somebody other than the Minister who would have discretion as to whether foreign companies are to be allowed to operate. If you cannot have that, then I suggest that you should define the general lines on which the Minister would act. If this cannot be done in the Bill it should be done by Order which could be laid on the Table of both Houses and which could be annulled if necessary. The advantage of the Order would be that the general lines would be laid down, and if it were proved that the Minister could not deal with a particular set of circumstances which might arise in the near future it would be very easy to make another Order. There should be some control other than Ministerial control which, I say, as much in the interest of the Minister as anybody else, is not desirable. Finally, I would urge that the Bill should be sent to a Select Committee which would be in a position to bring before it people who have some experience in the particular difficulties that might arise. I am not suggesting that we should get any people to discuss the principle of the Bill, but there are many details in regard to which it would be very advantageous to have some outside assistance. This is a Bill in regard to which a Second Chamber can give substantial assistance. It deals with a very big subject, and there are many points of detail, only a few of which I have put before you.
We have had such a number of Bills recently that I have not been able to go into the details of the Bill before us. There is no question that it is a Bill of extraordinarily difficult and intricate clauses. From what we have heard from Senator Douglas I think there is no doubt, in the interests of legislation which is proposed here, that the proper method for us to adopt would be to refer the Bill to a Select Committee for detailed examination by people who really know the subject. There is just one question that I should like to ask the Minister, the answer to which I have not been able to gather definitely from what Senator Douglas has told us nor, indeed, from what the Minister has told us. That is whether, in the case of an existing business, say a large manufacturing company, of which there are several in the Free State, an extension of that business would come within the purview of the Act. Is it intended if there should be any extension, either an extension of what they are actually manufacturing at present or a slight variation of what the company produces, that it would be necessary then to apply for a licence to come within the scope of this Act? If that is the case, I have in mind one or two companies in this country where such a procedure, if it were necessary, would be almost impossible to carry out.
I know a company in which there are thousands of shareholders. Now if it were necessary for that company to take out a licence, if it made up its mind to manufacture something a little different from what it is now manufacturing, if it had to ascertain the nationality of all its shareholders, while I do not say that it would be impossible, I certainly cannot see how it would work. If, in connection with that extension, it was found that one of the shareholders failed to be a national, I understand the company would suffer great pains and penalties——
Not one, fifty-one per cent.
Yes, but if that company extended its business or enlarged its capital, if the new and the old shareholders came within the scope of this Bill, then those old and new shareholders in that business would require to be nationals and that would be almost impossible. The question I put the Minister is this: Is this Bill intended to cover an extension of an existing business, whether that business manufactured exactly the same thing as now, or, under its articles of association, manufactured some other product?
Senator Guinness has asked a question which is of very great importance. I am sure the Minister will satisfy him thoroughly that the Bill does not, in any way, prohibit what Senator Guinness has in mind, that is the extension of a business. The Minister must have considered that. It seems to me quite clear, from the Bill itself, that existing businesses are, as they ought to be, safeguarded in every way. I think Senator Douglas, in his close survey of this Bill, overstated the case at certain points. If Senator Guinness would look at Section 2 (e) I think he will see that an existing business is not precluded from making an excess.
Read the whole of it.
Yes. I shall:
(e) Such business was carried on in Saorstát Eireann on the 1st day of June, 1932, and such business is, at the time such thing is done, beneficially owned by the individual or all, some, or one of the individuals by whom it was beneficially owned on the 1st June, 1932, and the doing of such thing would, if it had been done on the said 1st June, 1932, have been in the ordinary course or formed part of such business as then carried on in Saorstát Eireann.
I should like to ask Senator Comyn a question: Who would decide what is "the ordinary course"?
We listened with very great attention to the speech delivered by Senator Douglas and, speaking for myself personally, I listened with great respect to the close survey he made, and the knowledge he displayed, and I hope Senator Douglas will now extend the same courtesy to me.
I did not intervene in that sense. I simply wanted to ask a question.
The matter would be for the Minister and, when I say the Minister, I mean the Government. In answer to the question, as put, I would say it would be the Minister that would decide that question. Coming back to the very important matter that Senator Guinness raised— and it is a question of the very highest importance—I think that the extension of a business which Senator Guinness has in mind would be an extension coming within that sub-section or that exemption that I have mentioned. Senator Douglas has not denied that there is need for a measure of this description, in an undeveloped country like ours, a small country, where we are endeavouring to protect the growing industry of the country. One example brings home to the mind the position much more clearly than a great deal of talk. I came across an example, a fortnight or three weeks ago, where a relatively small firm was established in this country at an expense of ten or fifteen thousand pounds. That firm made a tender for certain work. The price was cut down so low that scarcely any profit at all was left; the tender was for a large amount. A foreign combine made a tender for the same work and their tender was, on examination, found to be £2,000 lower than the economic cost. What was the meaning of that? That foreign combine, in order to destroy the new firm in this industry, was prepared to lose £2,000 upon the contract. Of course it would make its profits, hereafter, when the smaller company was broken, and when competition would put an end to it. I hope if industries develop in this country they will rather be on a small scale. I believe that most of the present misfortunes of the world are due in great measure to the machinations and combinations of combines. One economist had one explanation; another economist had another explanation. Some people say it is due to the hoarding of gold; other people say it is due to the operations of finance.
I suppose I am entitled to offer an opinion. I would say that it is due mainly to the fact that goods are turned out by mass production, and that men here and there are thrown out of employment in great numbers as the result of changes in that mass production. I think that is one of the causes. The other main cause is that new articles like motor cars have come into commerce, and that things of that kind have been sold at prices which are greatly in excess of their real cost; that trade, commerce, manufacture and employment have been dislocated in the last ten or fifteen years in a way in which they were never dislocated before. I hope if we have industrial development in this country we will not have it by means of combines, and that we will encourage small industries which will distribute wealth and capital more evenly amongst the people. It is for that reason I am in favour of the principle of this Bill. I agree with Senator Douglas that it is necessary and desirable that the operations of this Bill should be closely watched and be in honest hands. I do not know any people more competent to supervise with skill and care the operations of a Bill like this than the Minister responsible and his officials. We are bound to assume that the people who may be trusted to act with the greatest honesty—with absolute honesty—in matters of this kind are the Government of the day, whether that Government is a Fianna Fáil Government, a Cumann na nGaedheal Government or a Government led and inspired by my friend Senator Gogarty.
Of course there are many difficulties in the construction of a measure of this kind. There are difficulties in its drafting, and there will be difficulties in its interpretation. Senator Douglas has raised for himself a great number of difficulties. Some of these difficulties, I think, it will be possible for the Minister to answer. Some of the other difficulties the Senator raised are only imaginary. He raised a point in the first place in relation to the definition clause. He wants to know what is the meaning of Section 1 (2):
Each of the following persons shall, for the purposes of this Act, be a national of Saorstát Eireann.
He wants to know what is "a national of Saorstát Eireann." The Senator also wants to know what is the meaning of the following clause in the section:—
(a) a person born in Saorstát Eireann or the area now comprised in Saorstát Eireann.
I admit quite frankly that that raises a very considerable difficulty. What is Saorstát Eireann and what was Saorstát Eireann? If I were to decide it, I would say that Saorstát Eireann includes the Twenty-Six Counties and the sea surrounding the Thirty-two Counties. That is a matter that Senator Douglas should apply his mind to. That is a nut for him to crack, and when he has cracked it he will find that what I say is true. The Senator then asked what is the meaning of Section 2 (1) (a):
such business is, at the time such thing is done, in the beneficial ownership of an individual who is at that time a national of Saorstát Eireann;
The meaning of putting that in is obvious, because in an earlier part of the section the prohibition is absolute, and being absolute it was necessary to set out in detail all the exceptions to the prohibition. I think Senator Douglas is unduly timid in regard to the powers conferred on the Minister in Section 10, dealing with the power requiring information. As I understand Senator Douglas his case is that if the Minister requires information from a company as to the nationality of one of the shareholders, and that the secretary of the company gives an answer which is not correct he will have committed an offence. I think the only obligation on the secretary is to ascertain from the shareholders, or from his list of shareholders, what is the nationality of the person. If he transmits the information which he acquires from his list of shareholders or from an inquiry from the shareholder he is guilty of no offence. That must be clear to anyone who considers the measure. Senator Douglas asked if existing companies should not be allowed to carry on any business set out in their memorandum and articles of association. He gave that as a reasonable solution of the difficulties in regard to existing companies. I cannot agree with him, and for this reason, that although a company may be engaged in one particular class of work, you will find on reading its memorandum and articles of association that they authorise the company to carry on any work under the sun. I have some experience of the drafting of these documents, and certainly I would consider myself very remiss if I did not include almost the whole scope of human industry. Therefore I think the Bill presents no difficulty, such as seems to be in the mind of Senator Guinness, and I certainly think the solution proposed by Senator Douglas is not the right one. I quite admit that this is a Bill which ought to be very carefully considered by the Seanad. It is a Bill in regard to which the Seanad has special knowledge. The Seanad is especially suitable for revising and improving a Bill of this character. I agree with the Senator in that. Senator Douglas asked what would happen in the case of a reconstruction of a company or the establishment of a new company. I should say that the ordinary rules of law would prevail, and that if a reconstructed company were on the same general lines as the old company, it would be treated as a company existing on the 1st June, 1932.
He agrees that the manufactures, especially the new industries which we hope to see in this country, will be under the control of the Irish people. Everyone agrees with that. It would be a poor thing if we set about reconstructing this country, establishing these industries and leaving them all to the control of foreigners or of foreign combinations who would have no interest in this country and no desire to serve it. He does not agree with the provisions which gives the Minister unlimited power to grant or refuse licences. Who else can get the power? Should it not be the Minister or the Government? They are the persons who have to bear the brunt of these licences. We trust them in the government of this country and we ought to trust them in regard to matters dealing with the industries of this country. I do admit that if there was a corrupt Government the power given is very extensive and could be used for the purposes of corruption, but we must hope that in this country motives of that kind will not influence public opinion. Moreover the Press is always there and the public are always vigilant to see that favours are not given through corrupt motives. I do think that just as we advocate schemes of town planning in the construction of towns or the growth of cities, there ought in this twentieth century be some sort of supervision of manufactures, to regulate the places most suitable for certain industries and not to allow them to grow up haphazard as they have grown up in other countries, where the political theory 50, 60 or 100 years ago was that there should be no interference at all with manufacturers; that manufacturers should be allowed to build wherever they like, to carry on as they liked, to congregate workers in any place they thought fit, and abandon the work when they thought fit, leaving the workers without any alternative employment.
The middle line is the best. I think that a great amount of freedom should be allowed to manufacturers, almost complete freedom, but I think that the State should have some power to regulate manufactures so that what may be to the advantage of one man may not work to the general disadvantage of the community. I think the interference by the State should be limited to that —to see that the profit of one man was not to be made at an infinitely greater disadvantage to the community. The licensing which was proposed in this Bill, I think, will prevent that.
Senator Douglas says that the discretion of the Minister should be limited either by statute or by general order. I think everybody will say that it would be quite impossible in this statute to draw up rules and regulations for the guidance of the Minister. I also think it would be impossible in general orders to deal with a matter of that character. On the whole, this difficult question has been dealt with concisely and, I think, very reasonably in this measure. I hope that the Minister, when he is replying, will say what I have been unable to explain in answer to the difficulty which was in Senator Guinness's mind.
I was disappointed with the subject matter of the debate on this Bill in the other House, because the Minister who was concerned with it proved neither the principle of the measure nor the justification for it. The few other speakers who favoured the Bill to a very great extent used arguments which could as definitely be used as arguments against it. In this Bill there is nothing new whatsoever. There is no new principle. Similar restrictions exist in other countries. The whole question is whether the application of such restrictions and the form in which they are presented to the House in this Bill are necessary and desirable here. It seems to me that like a great many other men, young and old, who are in authority in the world to-day, the Minister is grouping in the dark to find some way to cure the ills which have come to mankind as a result of the increasing speed with which science is artificially moulding and complicating human existence. By this Bill the Minister is seeking to alleviate those ills by taking a very long step in the direction of State control. In this Bill he is providing us with an example of what in terms of political economy is termed an "optional" as distinct from a "necessary" function of Government.
I am not one of those who thought that the late Government did what was all for the best on every occasion for the country. In the same way I doubt entirely that everything that the present Government are putting into shape is entirely wrong. But in this Bill I think I see the hands of a somewhat impatient reformer, regardless of the particular circumstances which are applicable, making one of those rash propositions conceived by sincere love of improvement, and attempting to obtain by compulsory regulations an object which can only be effectually compassed by public opinion.
In this Bill the Minister has brought to the House a measure which has presumably had the benefit of the considered opinion of the other Assembly though it is extremely interesting to note that only one speaker among the Government supporters ventured to enlarge on the Minister's opening remarks in explanation of the measure. In fact there was only one of the Government supporters, Deputy Corry, who made any contribution in support of the Minister's opening explanation of the Bill. I wonder if all those who remained inarticulate had satisfied themselves by reference to some of the admitted authorities and by a study of the Bill that the principles in it were applicable to the conditions which obtain here? I suspect that there are certainly some members who did nothing of the kind. One matter here which underlies this measure is that all who undertake to carry on manufactures in this country for the purpose of gain shall be under the control of the Department.
It safeguards, to a very considerable extent, existing businesses, but it provides that, after a certain date, no new undertakings shall operate except on terms to be laid down by the Government. The Minister has, no doubt, in mind the convulsions which have occurred elsewhere and which are attributed, I think very rightly, to the political control which has definitely been exercised through the medium of capital which was originally put into these countries for developing purposes. They were entirely new countries. He believes that, if Irish nationals can be pursuaded to invest their savings in Irish undertakings, there will be greater political stability —I fancy, at any rate, that that is his underlying idea—and that the investor and the elector will weigh more carefully the suggestions and promises which are offered to them by the different political parties in the future when they invite their support at the polls, and I think he probably argues that industries owned and controlled by Irish capitalists would make for speedier and, possibly, more enthusiastic development than undertakings owned by people outside the Saorstát. I have no objection whatever to that idea, but I think that, in this measure, they are falling into the error made by other Governments in the past of disregarding, because of political expediency, some of the principles of economic science.
The proposal before the House, however patriotic it may appear to people, is grounded, so far as I can see, on a false view of the subject, that is, that the capital of the investors can be profitably forced in a certain direction by Government interference. Excluding confiscation, I think that economic history not only denies that proposal, but records exactly the contrary effect. In this Bill the Minister says that, after a certain date, "You shall not work for gain in this country unless you are a national and are in control of the business, and even when I have given you a licence to start under my own conditions you will be subject to constant inquisition, and at any time the licence granted by me may be revoked, if you commit an offence of which you are convicted by a court." He goes on to say "I have absolute discretion as regards the terms of your licence, its continuation, its renewal and its expansion and I have taken powers to control your testament in connection with it." Assuming, for the sake of argument only, that the theory involved is not entirely opposed to accepted principles, there are many details in the codification of the theory which are open to criticism and which require explanation, examination and amplification.
I will refer to them now very shortly so as to avoid, if possible, amendments at a later stage, and I hope that the Minister may be able to explain them in his reply. Senator Douglas has dealt with a good many of them already and one with which he dealt was the definition of a "national." I think that that definition might produce some very curious citizens. I certainly thought so before, but when Senator Comyn described the areas in Saorstát Eireann, it makes it more complex still. So far as I can see, there is nothing to prevent a pretty mermaid born on the coast of Clare, taking some of the shares and disappearing without leaving an address. You may find extraordinarily difficult things like that happening which will make things very complicated. Section 2 seems to operate to invalidate a licence in the case of a national who bequeaths his interest or defaults to some alien. It should be possible for an applicant to submit a refusal under Section 5 (1) to a special tribunal, and the House, to my mind, should have some indication of the conditions which are referred to in Section 5 (2) (c). I think the whole of this section is dangerous, in so far as it gives dictatorial power to one man who, be he never so conscientious, might have ideas which are definitely biased in one direction or another.
I think that speakers in the other House have referred to the possibility of graft in this question. I am not at all perturbed by that possibility in the ordinary sense of the word but I do think that political expediency must on occasion influence the granting of a licence under the conditions set out in the Bill. It would, I think, be a more satisfactory solution, both for the Minister and for the public, to have some commission charged with the examination and recommendation of applications for the grant of licences. I would like the Government to be consistent in this matter and I hope that when the debates in this House are published, Senator Comyn will read what he said to-day, because I look on this as a tariff on capital coming into the country. You can view it no other way, and in connection with the operation of tariffs, I notice that, last week, Senator Comyn said: "I am unalterably opposed to giving any Minister or Ministry such a power as is suggested," and on the same day the Minister in charge of the Bill to-day said: "In matters like tariffs, the Executive does not think it wise for any such power to be vested in a Minister. We feel that it is a matter for the Oireachtas. If the powers are left in the hands of a Minister, he would be subject to all sorts of undesirable pressure, political pressure and trade pressure, asking him to move in one direction to-day and in another direction to-morrow" and, therefore, I think that Senator Douglas in stressing this question of a commission or some outside body, was perfectly right and was protecting the Minister, amongst other people.
In Section 10 the administrative machinery for carrying out the inquisitorial provisions must mean considerably more staff rather than retrenchment. The Minister who introduced this Bill in the other House said that this is a very mild measure, while another speaker said that one could drive a coach and four through it, but there is certainly one important feature in which it is mild and faulty. The Bill makes no provision for dealing with what I call a legally organised monopoly. Suppose an American, who was born in Saorstát Eireann 50 years ago, came back here and acquired, by reason of heavy capital of his own, the bacon industry, there seems to be nothing to stop him from doing so and from manipulating the various markets to his heart's content. I think that that point should be examined. Now, I do not want to be personal in this matter and I never am personal in this House. The Minister himself did not draft it and I hope he will not take what I say as being personal, but why does he want to control manufacture and how does he justify, in Mills's words, "the arrogation to himself of all the intellectual capacity and active business talent of the nation"? That is, in effect, what is being done in the shape of this control.
Is he certain that he will get all the capital required for industrial development under the operations of these restrictions? I, for one, am doubtful about that until the Bill has been immensely improved and a great deal more care taken over it than there has been up to the present. A great deal of capital has to come from people in this country. There are two classes of investors in this country without whose help no new industry can start, if this Bill becomes law. There is the farmer, who wins his shilling very hardly indeed—and he is conservative. He does not read many papers and does not think about investments. I think that, short of the compulsion which has been exercised on the Kulaks elsewhere, he will, if he possibly can, for many years to come continue his policy of keeping his money on deposit at a low rate of interest in the bank, where hitherto, at any rate, he has been saved from loss and where he can put his hand on it. That is one of the biggest classes from which Irish capital can be drawn at present. Then there are a smaller number of income and super-tax payers who now, with diminished resources, have such increased burdens to carry as will preclude for some time their making any large contribution to new industries. I should be surprised if either of these classes will hasten in any way to take advantage of these new conditions. They will think a long time before they hurry into investing capital in industries where there may be difficulties, unless they are cleared up in the way Senator Douglas suggested.
The late administration meddled very considerably in the economic complex and the present Government are following, even running, in their footsteps. I think in this measure they are disowning the practical maxim that "The business of society can best be performed by private and voluntary agency having a direct interest in the result and unhampered by bureaucratic control." I suggest, with Senator Douglas, that this measure requires very careful examination. It cannot but be improved upon. If we are to get the best value for this policy, and to help the Government in any possible way we can in carrying out their tariff policy, then I think they should agree with us that it should be carefully examined by this deliberative House and we will see in what direction we can possibly improve it and so make it a working concern, if it is to be a working concern.
I think we are a little bit at cross-purposes in the discussion on this Bill. Of course, I take it for granted, when I look around the House, that there is no notion of taking a vote on the Second Reading of the Bill and that we are making Second Reading speeches with the knowledge that the House is going to give the Bill a Second Reading, and that therefore, one need not trouble about making anything except the required criticism of the Bill. Why, I think, we are at cross-purposes is that Senator Douglas spoke of the various matters in the Bill which would prevent it working and prevent capital being put into new industries in this country. His idea was, and I think Senator The McGillycuddy was on the same lines, that the Bill should be so improved that capital could be put into fresh industries in the Saorstát. I do not know whether I took the Minister up correctly or not, but I do not think that is his point of view. I read the Bill through and the conclusion I came to after looking at its provisions was that no one, Saorstát citizen or otherwise, would put money into new manufacturing firms under the provisions of the Bill. There are too many complicated and difficult questions and the Minister is finally left the whole decision as to whether you can carry on or not and what conditions you will carry on under; and at any moment he has power to revoke your licence to carry on the business. I cannot imagine walking into the Stock Exchange, or any other place, and asking people to take shares in a company under such conditions.
Am I wrong in concluding that the Bill was meant to prevent the introduction of new capital into the country, except under Government control, and if it is to be in competition with Saorstát manufacturers it is to be squashed at once? If that is the Government's object in bringing in the Bill then there is undoubtedly a very great difference of purpose between the Government which advocates this Bill as it stands and those of us who want to amend it so as to prevent what we consider to be the evil effects and leave the door open by which new capital can come in, either Free State capital or any other capital, to establish new industries in the Free State. That seems to me to make it very difficult to discuss at this time. When we come to the Committee Stage we shall be able to consider it at greater length.
If the object of the Bill is to give the present or any future political Minister complete control over the way in which any fresh industries are to be started here, our present Government having as its object preventing competition with the existing manufacturers, another Government probably wishing to encourage business in this country on larger lines and considering that they should come in, and on each change of Government new companies being at the mercy of the Minister for Industry and Commerce of the day, that will wreck all future prospects. If the purpose for which the Bill is being introduced, and which I think I heard the Minister state is the real reason for the Bill, is to give the Government control in the country, I do not think there is much use in trying to improve the Bill. It will come out later in the Committee Stage, but if we did improve the Bill, so that there was a chance of fresh capital coming in to open up fresh industries, I think the Minister at the head of affairs would still want to keep control to such an extent that he could work it according to the political object which lies in this Bill. I will call it political. It means the giving to existing manufacturers in the Free State a lease of their businesses free from competition from any other business which could be introduced. Is that in the interests of the community?
I say this has its political object. It is practically at one with the tariffs which are now being put on. We are going to keep out all the manufacturers from other countries and we are going to establish entirely in this country manufacturers whose produce our citizens are to be allowed to buy. That is the idea of the tariffs and of this Bill, which it is necessary to have behind them. It is a very serious proposition for the nation. It is certainly against all the principles by which nations go ahead in the world. We may be quite a happy little nation, manufacturing only for our own people, refusing to buy from any other country and sitting on our own industries. If that is the object, this Bill is all right; it will do it. It is not a Bill which tends in any way to facilitate the introduction of capital in the establishment of new businesses in the Free State. These are my views as regards the Bill. That is the impression the Minister has left on my mind as to what the Bill really means.
Things are rapidly changing in this country. We are becoming a highly tariffed country. In America, which is also a highly tariffed country, they have a definite system in regard to workers or manufacturers who go out of employment. When a worker becomes unemployed he does not go home and sit down until he sees a vacancy in his own particular line. He takes the first thing that offers. He is out for work. In this country if a shop assistant, say, is out of employment he looks for work in the particular line in which he has been trained. If a manufacturer's business fails in America and in other countries the manufacturer turns his machinery to other work. I think the same thing is likely to happen in this country and this Bill makes no provision for any such contingency.
I will give a case in point. Take Fords in Cork. I am sure we were all glad to see that factory established there. I saw motor cars being manufactured in it. They were sold principally in this country but some were exported. I saw that factory afterwards making tractors, principally for the Russian trade. After a time they found that tractors did not pay; I suppose there was no demand for tractors in Russia. They then turned to the making of rainwater goods, of which we need a good deal in this country. Under the new Housing Act we will probably need more. They are now making eave gutters and down pipes for the purpose of taking rainwater from houses. They were making rainwater goods on the 1st June. Suppose some day they find that it would pay them better to go back to the manufacture of motor cars or tractors or, for that matter, suppose they go in for making typewriters, will they need a licence? If they do I do not think it is fair. Once they are manufacturing in the country on the 1st June I think, no matter what they want to manufacture, they should be allowed to do it without any restrictions. They certainly should not be obliged to look for a licence.
No doubt with these restrictions and tariffs Irish manufacturers will be helped a good deal, but there is one aspect of this matter to which I would like to refer. Firms, no doubt, take advantage of the Acts passed here and they put in advertisements requesting the people to buy Irish goods. At the same time they do not pay much attention to other Irish manufactures. They think nothing about the other businesses that are run in this country and that need patronage. I have in my hand an envelope. It bears the name of a company that got a big loan from the last Government under the Trade Loans (Guarantee) Act. On this envelope is an advertisement setting out the name of the firm with the words added: "Buy Irish and reduce unemployment." That envelope is made and printed in West Bromwich. It is lined with green. A green envelope for green people.
I would like the Minister, when he is replying, to deal with Section 14.
I would like to ask the Minister what will be the position of people who import a very large amount of parts from England, readymade, which are assembled here.
I am rather glad in many ways that in spite of the small assembly that we have here this morning the debate has been of an interesting and illuminating nature. I am glad to find that in spite of the diversity of points of view, in many cases points of view disagreeing with our fundamental policy, that the various sections of the Bill and the outlook that is behind the Bill have been subjected to what I might call constructive criticism. This is, admittedly, one of the most difficult types of legislation that it is possible to conceive. It is surrounded with dangers, pitfalls, and the possibilities of misinterpretation and misdirection. These very features make it almost essential that, in the matter of the administration of the Bill, discretionary power must lie somewhere. The question then arises, with regard to that discretionary power, whether it is wise to have it vested in the responsible Minister, in a consultative body, a discretionary body or a board. On consideration of all these possibilities it is felt that in the case of a measure such as this the direction and the guidance should lie with the Department. Viewing the position from the definite line of policy that is being pursued by the administration, the Departmental officials are in an unequalled position to get all the details and all the data necessary to guide the Minister. In spite of all those difficulties, no Bill I know of which has been presented this session has caused so much internal consideration as this particular measure. I have been interested in this Bill from the beginning. We had draft after draft of it before us before we felt that there was afforded adequate protection to the public, adequate fair play to existing organisations, and that there was secured elimination of any reasonable possibility of doing injury to any industry established prior to the present Executive coming into power. We realised that certain industries were established here under a particular set of conditions then applicable, and that it would be most unjust and wrong to interfere with organisations which had come in in perfect faith prior to our policy being enunciated. That must be clearly kept in mind in consideration or criticism of this measure. It has to be remembered that no industry that was in existence on 1st June is being interfered with.
Secondly, there was the question of possible interference with any of our own nationals embarking upon business. That was one thorny subject when the matter was before the Executive Council. It was argued that it would be desirable, in the general interests of the workers in a trade and in the general interests of the trade itself, and that, in the case of certain industries about to reach the point of overcrowding, no further permits should be considered even for our own nationals. All the practical and efficiency values were in favour of the refusal to grant further licences in an overcrowded trade, but it was pointed out—I am speaking quite frankly of the various discussions that went on before this Bill reached its present state—that it would be absurd and wrong, whatever efficiency the other system might enable the industry to reach, to lay down such restrictions on the development of business here. Accordingly, there is no interference in the Bill with an industry, whether foreign-owned or otherwise, that was in existence in the manufacturing end before 1st June, and there is no restriction on development by any Irish national or any group of Irish nationals.
Senator Douglas has raised many points—some of them of very real interest. While one or two of the points the Senator raised obviously require careful consideration and will be considered if he brings forward amendments or suggestions on the Committee Stage, still, many of the points he raised are not such as would worry any person endeavouring to administer this Bill both in its terms and in the spirit behind it. Senator Jameson raised a point which bears on Senator Douglas's and Senator The McGillycuddy's criticisms of the Bill. He brings us right back to the fundamental question as to whether members of the Seanad, or such Senators as spoke on the Bill, really approve of the principle of the measure and want to improve it or whether many of them disapprove of the whole policy behind the Bill. I think that is really what Senator Jameson meant to bring out. Perhaps it would be simpler if we got down to that question first. Senator Jameson clearly indicates that his point of view is that we should not prevent competition, that we should leave the ordinary run of industry, manufacturing and otherwise, to take its natural course; that these things will adjust themselves, that life goes on, that enterprise, courage, investment, freedom of markets, freedom of trade, either on the part of foreigners or natives, should be allowed to go on; that that serves the public best, that the public thereby get best value and that, generally, it makes for a better social organism. Let us face up to that right away. I think I have interpreted the Senator correctly.
You are giving me credit for some of the remarks of Senator The McGillycuddy.
Generally speaking, I think that is Senator Jameson's point of view. It is not the point of view of the Executive Council. The whole history of free competition and free exploitation is known. I think it cannot be argued at this stage that this free competition that was known 50 years ago does really exist even in countries where it nominally operates. We do know that the trust and the combine operate, that they hold in certain countries the lives of the people in their hands by their control of the supply of necessaries. We know that there is far greater danger of political corruption from big interests linked and fused together in such trusts than there is from the operations of a Minister who is always subject to control by the Parliamentary organisations under which he has to work. That has to be understood if we are to appreciate what the idea or purpose behind this Bill is. We do not think that unlimited opportunities and freedom of action should be allowed the foreigners coming into this country. I might point out that many struggles, conflicts, and even wars have been due to alien operations in other countries. They brought about a situation where they control practically the life of the people. They control the financial operations of the Government. They control the Government and eventually lead to revolution. I think that the history of the Latin Americas will clearly indicate that. Financial and business operations to me are more dangerous than even political control by another country.
As I am on this point, Senator Staines raised the question of highly tariffed countries and of men going out to work at any job that came along. That is so in the United States but it is not entirely so. Whilst there is more movement perhaps from one industry to another by the operatives in the United States there are at the same time some of the strongest and most powerful trade unions that are known in the world operating in the United States. For instance in all the building trades, constructional steel work and in the Garment Workers' Union, no person can get into the work without the full consent of the organisation. These are tighter corporations than anything we know in trade unions here. I mention that to show that there is no universal rule and no universal panacea for these things.
Senator Staines also raised the question of displacement from one industry to another by an organisation that had been operated before 1st June. I think the example he quoted was perhaps the most suitable of any that could be thought of in this country. That is the position with regard to Fords in Cork, assuming the tractor trade failed and they found an outlet for their activities in making spoutings, drain gutters or anything else. In that, of course, one must assume that the Minister who would be operating the Act would show reasonable intelligence and discretion. Naturally, the making of any metal goods could be considered an allied trade in the case of Fords. Similarly we would find in other trades what we would look upon as developments or legitimate branches that could be pursued.
What is really in mind in regard to the Act is this: Let us assume that a company has accumulated say £100,000 in reserves. It is perhaps in the woollen trade and it sees the possibility of operating in another trade and proceeds to get a licence for that. I am assuming that all the other conditions of the Act are involved. The company proceeds to try to get into another trade. They would not in the ordinary way get a licence in that trade. The only reasonable thing to provide is that if it were a new trade for them they would not get a licence; they were not entitled to a licence de novo. In other words a company that would not get a licence in the first instance would not be allowed to extend to a different industry altogether and create a new concern. Naturally we shall welcome and hope to see the fullest possible development of existing organisations and that they will branch out into the various activities connected with their own trade.
That is the matter I mentioned, the question of allied trades.
Exactly, allied trades. One of Senator Douglas' points was in my opinion fully answered by Senator Comyn when he pointed out that sub-section (e) of Section 2 allows a legitimate extension and expansion of any business. Senator Douglas raised the very interesting point to me, and I am sure to some others, with regard to "resident" and "nonresident." In this is involved the whole question of citizenship. I explained in the beginning that citizenship for the last ten years has been in a very ill-defined position. As a matter of fact, the definition is such that I believe lots of people who have been born in the Free State are not citizens at all. I believe that is the position if the Act covering the matter were literally interpreted. We have realised that and it is proposed at the very earliest moment possible to introduce legislation in regard to the whole question of citizenship. That is absolutely essential.
In the meantime we come up against the question of the person resident in the Six Counties. Senator Douglas appears to think, what no doubt would be a very desirable thing, that every Irishman in the Thirty-two Counties should be treated alike. There is nothing we would welcome more but we have got to consider the position that has been created and to realise that it has not been created by us. We would welcome the time when the people of the Six Counties would be looked upon as Irishmen in the same sense as a citizen of Saorstát Eireann is to-day, but I think we must all regrettably bow to the position that does exist. From the legislative and Governmental point of view, the very regrettable position is that these people who are resident in the Six Counties choose for the moment to be citizens of Britain and the Six Counties rather than citizens of this State.
Senator Douglas raised various queries about particulars that would be required from corporate bodies in connection with their licences and the possibility of false statements being made even unconsciously, statements as to shareholders by the secretaries of companies, and so on. I do not think that, whatever is done by amendment in the Committee Stage, all these points can be or will be adequately covered. I think that no matter what you try to do by Act of Parliament or legislative measure you will find finnicky points where a person who wants to evade an Act can possibly evade it. We approach this thing from the point of view of the ordinary concern that comes along in a perfectly straightforward way and asks for a licence. It is to be assumed that in making such application they will try to comply with all the regulations laid down in the Act. I submit that there is no great hardship imposed in the demand made for full particulars so as to guide the Minister as to the validity of the claim for the licence. There again is a point upon which the Minister's discretion is really the only reliable factor on which to decide. It is the only reliable decisive point upon which we can find if all the sections of the Act are being complied with, if it is a perfectly legitimate claim for a licence and if the person or corporate body claiming it are justly entitled to it.
The point was raised in connection with the retail distribution trade, and the matter of adaptation for sale, where a person buying a coat might ask to have an inch taken off it. I do not think that can be intended as a serious argument. People have to work intelligently within the Act. I do not know whether it would require a special amendment to deal with the reduction in size of a garment, but obviously, it is a matter that is quite ridiculous to raise in this way. If the Senator thinks that he could introduce a covering amendment that might ensure such an operation being dealt with I would be glad to consider it.
Senator Guinness raised a point with regard to the extension of business also. I have explained, fully, what we mean by extension and what would be interpreted as an extension. It will be obvious to any business man what an extension is, and whether, instead of being an extension an entirely new departure took place. I think that can be left to the discretionary power of the Minister and I am quite satisfied that there will be no abuse or hardship. These were the main points raised. I admit specifically that this was an intensely difficult measure to draft. It has given us a great amount of thought and consideration, and required a great deal of effort to try and get it into its present form. We follow, as completely as it is humanly possible to do, in an Act of this kind, a scheme carrying out our wishes for the protection of our own nationals, the protection of existing businesses, the prevention of exploitation of the country by groups of manufacturers or syndicates or trusts and the safeguarding of the manufacturing industry in this country.
The question as to whether it is necessary or desirable to get foreign capital into the country is one on which people differ. I have explained my point of view. I think it is a most dangerous thing to have foreign exploitation of capital in any country. I look upon it as no less dangerous than political exploitation by a foreign power. For these reasons I hope this Bill will go through in such time as to enable us to go on with certain work that is pending. We have got a number of applicants waiting to come forward for licences immediately that this legislation goes through. If the Seanad, and those in the Seanad interested in this Bill, can see any point, which by amendment will improve the Bill, not only will we consider it, but we will welcome it. We want this measure, and if anything occurs to Senators that will generally improve the Bill, keeping in mind our point of view of the social conditions, we will not only consider it but we will welcome it if it is an improvement in the measure.
Cathaoirleach
Senator The McGillycuddy was anxious for some explanation in regard to Section 14.
I intended to answer that. The reason for eliminating the obligation to those milling wheat or adapting for sale any product of wheat, is that there is a complete Milling Bill at present under consideration for the development of wheat growing and flour milling on a national basis throughout the country.