Tobacco Bill, 1934—Committee Stage.

Sections 1 and 2 agreed to.
Question proposed: "That Section 3 stand part of the Bill."

This section deals with the setting up of a tobacco advisory committee and I draw attention to the matter because it has given rise to a good deal of misunderstanding amongst tobacco growers in the country. I think it well to give the Minister an opportunity of explaining it. I understand that this advisory committee will consist of representatives of manufacturers and that they will deal only with the disposal of tobacco when it has left the rehandling station, so that neither the growers nor the rehandlers have any reason for representation on this committee. Growers throughout the country do not understand why the committee is limited to manufacturers and they approached me to ask why no representatives of the growers were on it. I think I am right in saying that this committee will deal only with the disposal of the tobacco when rehandling is finished, but I should like the Minister to say if that is correct.

That is quite right. When the tobacco is catalogued under Section 38, which comes later, the Minister for Industry and Commerce makes a sale order under Section 40 and distributes that tobacco amongst the manufacturers. This particular advisory committee is to advise the Minister as to how the tobacco should be distributed amongst them. As far as growing, curing and rehandling are concerned, these three processes are in the province of the Minister for Agriculture who has power under the Agriculture Act of 1931 to set up an advisory council for any purpose he thinks fit. It is quite possible and, in fact, quite probable that the Minister for Agriculture will have an advisory council under this Bill. That advisory council will consist of growers, curers and rehandlers and manufacturers would not be represented on it at all because they would have nothing to do with that part of the business.

I may take it that it is possible that an advisory council will be set up?

There will, yes.

Section 3 agreed to.
Sections 4, 5, 6 and 7 agreed to.
Question proposed: "That Section 8 stand part of the Bill."

Where are the duties on home-grown tobacco specified?

In the Budget each year.

How about the duties from now until we get the Budget?

The last Budget specified them, giving a rebate of 10d. per lb. on home-grown tobacco.

Section 8 agreed to.
Section 9 to 29, inclusive, agreed to.
Question proposed: "That Section 30 stand part of the Bill."

This deals with the fixing of a minimum rate of wages for employees in the rehandling stations. In the case of co-operative rehandling stations, the rehandlers may be the growers, or representatives of the growers, and it may happen that the same man or men may be employed for one part of the year in the field on the cultivation of the tobacco, and at another time of the year, in the rehandling station, and it seems to me that a good deal of discontent may arise if a man gets a low rate of wages in the field because the farmer or grower is unable to pay him the same rate as he would get in the rehandling station. Further on in this section there is a provision that the Minister for Industry and Commerce, after consultation with the Minister for Agriculture, may, if he so thinks fit, establish an advisory committee to advise him in regard to the making of orders and that this advisory committee shall consist of workers at rehandling stations and persons representing the employers of such workers. It may happen that the employers of such workers may not be the growers, so that the growers are left out altogether. A certain amount of discontent may arise in a district on account of this section, and I think the growers should be included. Would the Minister accept an amendment to add after the words "persons representing employers of such workers" the words "and growers or representatives of tobacco growing societies or associations"?

It would appear to me that if it is a co-operative organisation of growers, they will be the employers.

Not always.

They will be the owners of the rehandling station and it will be from such persons, as owners of the rehandling station, that the employers' representatives will be chosen. The Senator's suggestion is that there should be two sets of rehandlers' representatives, one representative of rehandlers who are not growers and another representative of rehandlers who are. That would, I think, be quite an impossible thing as an administrative proposition.

I have seen the paper on which the rehandling stations are set out, and if the Minister would assure us that they are all owned by growers I withdraw my objection.

The majority of them are. I hope in time that they will all be co-operative. I think if the Seanad understood how this matter arises they would perhaps see why it is worded in this way. The Trade Board Acts, 1918-1919, already apply to the manufacture of tobacco. As the order stands, we were informed on legal authority that the rehandling, even the curing and growing would come under the Trade Board Act, so that there would be a fixed wage for the men while attending to the tobacco in the field. When a man would leave the tobacco field and go to work on the wheat field he would be paid the ordinary agricultural wage, but he would be paid the Trade Board wage while in the tobacco field. This amendment was put in to exempt the growing and curing of the tobacco from the operation of the Trade Board Act. Rehandling, as it comes more within the industrial side than within the agricultural side, should really come under the Trade Board Act. As the majority of the rehandling stations are co-operative naturally there would be representatives from the board, so that the growers will have representatives any way. They will not have all but they will have some at least.

The growing and curing do not come under the Trade Board Act —only the rehandling?

Yes, and the effect of this clause is to exempt them.

Yes, I understand. But where ordinary business people have no connection with the growers, if there are rehandling stations the growers should have something to say to it.

There will be one board appointed. If there are three members on that board, perhaps two would be from the rehandling stations.

Why do we need the Minister in this particular instance to come in to settle wages? I do not know that our Executive Government is coming in here to settle wages in many industries. Then why is it doing so in the case of the tobacco industry, or why in this particular instance of the tobacco industry it is necessary for the Minister to settle the wages?

If the section is not worded in this way the industry will be brought in under the Trade Board Act. The Trade Board is doing the same thing in a different form. The Minister fixes on the advice of the Trade Board. If you leave this out the probability is that the rehandling station would be brought within the tobacco trade board and even the curing stations may be brought in. But this particular provision leaves the curing outside the purview of the trade board system. It is a kind ofvia media in respect of the rehandling part of the tobacco industry. Instead of leaving rehandling within the Trade Board the Board would recommend the Minister to fix the minimum rate which would be operative. This leaves the matter with the Minister if he thinks fit after consultation with the Advisory Committee. It is a little less definite and perhaps a little more effective than the Trade Board would be. But it is acceptable in its present form and it is not by any means a departure, for there is a Trade Board already for the tobacco industry.

Is it a fact that it is considered necessary to fix by the Trade Board or by the Minister the wages in this particular industry?

The Trade Board only deals with the minimum rates.

But it is the minimum rates that are of importance. You have the position that in an industry like this either the Trade Board or the Minister prescribes the minimum rate of wages. This does not apply to many industries in the Free State.

The Senator does not realise that it is the case in the tobacco factories in this country which are under the Trade Board at the present time. The provisions referred to by Senator Johnson are operative there. If we did not put in that provision in the Bill, rehandling, growing and curing would all come under the Trade Board. This section was put in to exempt them from that.

Does the same thing hold with regard to the growing of beet?

No, it is only where the industry has applied to come under the Trade Board Act.

There are many industries which are regulated by trade boards so far as minimum wages are concerned.

Is it not a fact that the Minister on application from either side can set up a trade board if he thinks fit?

Why is this particular arrangement superior to leaving the ordinary Trade Board system work? That is not clear to me.

Senator Johnson explained that we wanted to exempt the growing and curing. We wanted to go half way in rehandling. Leaving it with the Minister with an advisory committee to do it will be practically the same as having the Trade Board doing it.

The growing could not come under the Trade Board Act, because it is not an industry that could come under the Act.

As the Act stands at present it would. If the Senator would look at Section 2 (a) he would see that clearly.

It was all put in by the Labour Party.

It would probably suit our purpose better to have both Sections 29 and 30 deleted. If the Senator moves that these two Sections be deleted I will support it.

Sections 30, 31 and 32 put and agreed to.
(1) Subject to the provisions of this section, every person who is the holder of a rehandler's licence shall purchase, at the price and on the terms and conditions applicable to such purchase under this Part of this Act, at the premises to which such licence relates, all tobacco in a suitable condition for rehandling grown by the holder of a grower's licence in the year to which such rehandler's licence relates and offered for sale in accordance with the provisions of this Act at such premises before the 31st day of December in the year in which such tobacco was grown, or such later date as the Minister may fix in relation to tobacco grown in that year.

I move my amendment:—

Section 33, sub-section (1). To add at the end of the sub-section the words "Provided always that fifty per cent. of the price payable to the grower under this Part of this Act shall be paid on account by the rehandler to the holder of the grower's licence within seven days after the determination of such price."

There have been a number of complaints by growers throughout the country that the rehandlers do not pay them quickly enough. In one case of which I heard the man sowed his seeds under glass early last year, subsequently transplanted the plants, cleaned them, weeded them, cured them, and gave them over to the rehandler, but he did not get paid until July of this year. The farmer in this country is not used to that. The farmer is accustomed to getting ready cash for his crops or for his produce. The only produce for which he does not get ready cash is milk. In that case I believe there is a system of monthly accounts, and he gets paid from the creameries or the big distributers here in Dublin every month. That is the only product for which he does not get paid cash. I think it is only fair that the rehandlers in this case should pay at least 50 per cent. of the cash to the producer within seven days of the determination of the price.

I desire to support the amendment. I had not time before these amendments were put in to have a conference with the tobacco growers in my part of the country, but I have had since and they are unanimous in the opinion that the price, as fixed is altogether inadequate. That fact makes this amendment even more important. The price was fixed on last year's crop which was a record one, grown in a record year. The crop is a very different one this year. It has been seriously affected by the drought and still more seriously affected by the storm of a couple of weeks ago. In fact a good many crops were completely destroyed. The farmers' financial condition does not enable him to wait for a very long time for his money especially in the adverse circumstances of this year, and I would urge the Minister to accept the amendment. I have a letter here from a tobacco grower which bears out what Senator Staines has said. He says:—

"In addition to the low price, it is also very serious for the farmers if they are left out of their money"—he is a Munster man and uses the Munster idiom—"for another six, eight or, perhaps, 12 months, if they are compelled to hand it over to a rehandler who need not pay them until the crop is finally disposed of. In some cases last year's crop was not finally paid for until July of this year. Farmers are now in such low financial circumstances they should be paid for their crop when it is cured enough to be rehandled or sold to a manufacturer, that is, in November or December of the year in which the crop is grown."

That is a very serious handicap considering that the crop is an exceedingly precarious one and liable to be damaged by storm. In fact, it is a crop that is altogether unsuitable to this country. It is like wheat in the fact that it is only in very good years that it can be grown at all. I would certainly urge on the Minister to accept the amendment. Under the whole Bill, the grower is made the Cinderella. The rehandler, the manufacturer and everybody, except the man who grows the tobacco gets a big pull out of it. He is the last person considered in this Bill. All the circumstances are against him, and I think that whatever he makes out of it, he should not be kept waiting for nearly a year for it. There should be some time limit, and as the amendment suggests, 50 per cent. of the money should be paid to him within seven days.

I cannot agree that everybody is getting something out of the Bill except the grower.

They are getting more out of the Bill.

The manufacturer, as a matter of fact, is not getting anything out of this Bill because it is definitely laid down that the manufacturer must pay the same price for Irish tobacco as he would pay for imported tobacco at that particular time—that is, imported tobacco of the same quality. It is an inspector appointed by the Minister for Agriculture who determines that quality. If my inspector has an optimistic opinion of Irish tobacco I think he will make the manufacturer pay all right for it, so that the manufacturer gets nothing out of it. The rehandler will get whatever the Minister for Agriculture prescribes. He cannot charge whatever he likes. He must charge what the Minister prescribes from year to year. If the rehandler gets more than his due, it will be the fault of the Minister for Agriculture.

With regard to the circumstances which Senator Miss Browne has mentioned—the farmers having a crop and the storm injuring it—I think that we must have growers who are good growers—I mean above the average. These are the only growers who will survive in the growing of this crop as in the case of every other crop. After all, if you have a certain price for oats, barley or wheat, it is only good growers who can hold out and continue growing these crops. The men who do not know how to grow oats, barley or wheat, who sow these crops in unsuitable land or under wrong conditions, do not survive. They have to give it up. The very same thing will apply in the case of tobacco. Only the good tobacco growers will survive Those people who do not pay any great attention to the crop will have to drop out because they cannot make it pay. As a matter of fact, some growers to whom I was speaking before the Bill was drawn up said that the price was going to give them as good a return, or even a better return, than the crops I have mentioned—oats, barley or wheat. We cannot give very much more than that because the acreage is limited. It would be very unfair where there are selected people to whom that limited acreage is given to give them a very big advantage.

Coming to the amendment itself, I do not see how it could be made effective. If Senators will remember the discussion we had on the Second Reading of the Bill, they will recall that it was pointed out that when the tobacco is sent by the grower to the curer and the rehandler it is graded into different grades. The rehandler does not know at that stage what price he is going to get. He grades it into A B C D and E grades. He may have a fair idea of what he is going to get then but he does not know definitely. The tobacco has to be rehandled, it has to be packeted, catalogued and sent on to the manufacturer. At that stage the price is fixed but at the time the rehandler receives it he does not know what he is going to get. He does not, therefore, know what 50 per cent. of the price would be, for one thing. Another difficulty is that I do not know how we could enforce this amendment. Suppose the rehandler were paying 50 per cent. and he said that the tobacco was eventually going to make 6d. He would then pay 3d. I do not know that we would have any power to argue the matter with him because at that stage neither the Minister nor the manufacturer could say definitely whether in six weeks or two months' time, the price of imported tobacco might not have fallen below the figure it was fetching at that time. Apart from that I know for a fact— several growers have told me—that every grower is being circularised by rehandlers. I think the grower is in a position therefore to make a very good bargain with his rehandler.

If we were to stick strictly to that 50 per cent. he would probably get more than the actual 50 per cent. The rehandler would naturally pay on the lowest grade because he would say: "I do not know, but this may be the lowest grade before it leaves my premises." Under the other arrangement, they are likely to give more because they are competing for the tobacco. No grower need send his tobacco this year or during the coming years to any rehandler without getting an advance on it on receipt. There was a different position last year. When growers sent their tobacco last year to a rehandler, there was an element of chance about it. The rehandler proceeded to rehandle the tobacco but he did not know whether there would be a market for it or not. The manufacturer was not compelled to buy tobacco from the rehandler. There was no guaranteed market. There is now. The rehandler knows definitely that he can dispose of his tobacco to the manufacturer. That should make it possible for every rehandler to get a good advance from his banker on the stock on hand. If the banker knows that the tobacco is going to be sold to a manufacturer within six weeks or two months—that the manufacturer has no option but take it— I think that the rehandler will be able to get an advance from his banker and that he will be able to make an advance on receipt. Last year, he could not do that because there was no certainty that he would be able to dispose of the tobacco. That made it impossible for him to get any great advance from the banks. This year, I think he will have no difficulty in that respect. It would be, in my opinion, impossible to implement this amendment. I should like to see the growers get an advance but I think that they will get that advance in the ordinary course of events.

I ask the Minister to accept this amendment. The amendment only asks for an advance of 50 per cent. of the estimated value. Even if the price of tobacco falls, it will not fall to that extent. The farmers are handicapped at present by want of capital. They find it very difficult to get money from the banks, whereas the rehandler, who will have a stock in hands, can easily get an advance from his bank and pay it to the farmers, who badly need it. The Minister says that the rehandler will not have any difficulty in raising the money on the stock he holds. I think that the amendment is very reasonable and, even if the Minister does not accept the percentage of 50, I think he should provide for the advance of some percentage of the amount.

I strongly urge this amendment. The price for rehandling at the stations is I understand 5d. Did I understand the Minister to say that the rehandling stations are competing for the grower's crops and offering him advances on them? What about the position in South Wexford? The only rehandling station there is far removed from the place where a great deal of the tobacco is grown. There should have been another rehandling station there. The pioneer growers have not got the rehandling station they should have got. The societies which rehandled tobacco last year have been favoured by the Minister. These are enthusiasts, inspired by ignorance. They do not know what they are doing. The Minister may say that the pioneer growers did not apply for a rehandling licence in time. That was because they knew what they were doing and they wanted to consider the question. The others rushed in. As fools rush in where angels fear to tread, the ignorant rush in where experienced men would not. There is one rehandling station in Wexford, at a very considerable distance from where most of the tobacco is grown. Will Wexford growers have to send their tobacco to Kildare or Meath instead of sending it to the station in Wexford? If the Minister objects to 50 per cent., let him fix upon some figure which will be of definite help to the farmer in paying the expenses of the cultivation of the crop.

The one attraction about beet is that money is advanced by the factory. If that had not been done, the Government could not have got contracts filled for these new beet factories. The Minister does not seem to realise the position in which the farmer is—that he has no cash and cannot pay his wages. A crop like tobacco takes a lot of weeding and handling. One is never out of the field from the time it is sown until it is harvested. It is not like other crops, where you lock the gate after sowing them and trouble no further. Tobacco is a constant expense to the growers. The price this year is very small, indeed, and a number of farmers are going to lose heavily. In some cases the tobacco crop has been destroyed and in others it is very poor. I hope that Senator Staines will press his amendment to a division.

I hope that Senator Staines will not press his amendment but that the Minister will consider the introduction of an amendment on the Report Stage to meet the point raised by Senator Staines. If the Minister gives an intimation to that effect, I hope Senator Staines will withdraw his amendment.

If the Minister accepts the principle of the amendment, I am quite prepared to withdraw the amendment. The Minister may not like the percentage but he can provide that so much per lb. will be paid. There must be some way out of the difficulty.

From what the Minister said about tobacco growing in Ireland, I should have thought that Senator Staines was appealing to a judge who would be very much inclined to give him a favourable verdict. I was almost frightened out of my life when I heard the Minister say that he was going to make it necessary for every resident in the Free State to smoke Irish-grown tobacco. If he wants to get such a state of affairs as that, the one individual he has got to make a pet of is the grower of tobacco. This claim that the grower should get a portion of his money fairly quickly represents a good commercial principle. The growers of practically every other crop get their money practically on the nail. Those who buy grain pay for it at once. I feel that what Senator Miss Browne says is correct—that, for some reason or another, the rehandlers do not give the growers the money within reasonable time. A great many of these growers are pretty hard up. There is evidence that the growers have to go to the banks. They have to pay interest on the money they receive from the banks and, to get the money, they must be persons of exceptionally high character. What Senator Counihan suggests is, I think, right—that the Minister should think this matter over and see if there is not some means by which the grower would get portion of the money advanced to him fairly quickly. That is a necessity in the agricultural situation of the present time. A man who has his crop ready needs the money for it. The Minister, evidently, wants to help tobacco growers. I do not think that he can do that in any better way than by taking steps to give the growers some part of their money as soon as possible.

There is no doubt that the rehandlers are making offers of advances on the tobacco, and I know that some of them are offering the full relative value. As soon as they have the tobacco graded they will give what in their opinion is the value of that tobacco. The amount kept back is the amount of subsidy that would be payable afterwards. I do not see any point in what Senator Jameson says—that some growers have to go to the bank and pay interest on money borrowed. It is quite obvious that the rehandler in some cases has to get money from the bank, and charge interest to the grower also. They are offering a good deal more than 50 per cent., and I think it is a case where the Seanad is inclined to go in too much for regulation. Sometimes if you go in too much for regulation it is bad. Free commerce in a case like this is better than too much regulation. I think the Seanad should be careful about going too far in that direction. Where you fix a minimum price, in nearly all cases it becomes the maximum price. If we say the rehandlers must give 50 per cent., that is the maximum they will give. They are offering more at present, and we should not stop them from giving more. It would be a great mistake, I think, to put in this amendment.

They may be offering more for the crop in a year's time.

They are offering more than 50 per cent. as an advance on receipt of tobacco at the rehandling stations.

Can the Minister assure us that that is being done by all the rehandling stations?

By a number of them, anyway.

That may be done by one or two, but not by the others.

The growers go to those who give the best terms. Now, with regard to the point raised by Senator Miss Browne, about the freight on tobacco from Wexford to a rehandling station, the freight from Wexford to Navan is only 12/6 per ton, so that the freight really makes very little difference compared with the cost of a small rehandling station. I think our object should be to have as few rehandling stations as possible so that they could be worked as cheaply as possible. At the moment we have to pay 5d. a lb., and we hope to reduce that by at least 1d. a year until we get to 2d. per lb. It is only the large rehandling stations that will eventually be able to carry on at 2d. Every time we cut down the rehandling charge by 1d., it goes to the growers. In the interest of the growers, nobody should advocate a large number of rehandling stations.

Is the Minister going to meet us in regard to this amendment?

I wonder if it would meet the case to have a provision inserted to the effect that the Minister would have power at any time to intervene in this matter? It is obvious from what the Minister said that this year there is not going to be any difficulty on this score, but in a subsequent year there might be, and perhaps it might meet the case if the Minister had such power.

Of course, I never object to taking power.

From what the Minister said, it does not appear to be likely to affect this year's crop. He has stated that the rehandlers are prepared to offer more than is required in the proposal.

If that were the case, why have I had numbers of applications from the growers to put in such an amendment as this? The growers are not satisfied about it.

Will the Minister consent to some definite sum, say not less than 3d. a lb., and then he could give more if he considers it advisable?

I think it would be a great mistake because they will not give more than what is specified.

From the letter read by Senator Miss Browne and the statement made by Senator Staines that the growers were kept out of their money until July, I think it is desirable that some definite provision should be inserted. The Minister cannot forecast what the rehandlers may do in future years. It might be better if he fixes a guaranteed market price to be paid to the growers.

I am prepared to consider an amendment such as Senator Johnson suggests and if I see the rehandlers are not treating the growers fairly, then I could utilise that power. It would be a mistake to utilise that power this year because the rehandlers are offering more than 50 per cent.


Perhaps Senator Staines might accept that?

Will the Minister produce an amendment on the Report Stage?

I think Senator Staines should put down his amendment again until we see what the Minister will produce.

That might be better.

Amendment, by leave, withdrawn.
Sections 33 to 62, inclusive, and the Title, agreed to.

In his opening statement the Minister told us that approximately 10,000,000 lbs. of tobacco were imported into the Saorstát yearly. Can he give us any information as to what amount of tobacco is at present grown in the country? Perhaps he could give us that information, not necessarily very accurately, but as a sort of comparison between the 10,000,000 lbs. that come into the country—foreign tobacco —and what is grown at home. I would like to ask another question. Is it permissible for an individual to grow tobacco for his own consumption—to cure it and use it for his own consumption—without licence?

One must get a licence?

The man who grows tobacco under licence, if he smokes a leaf of his own tobacco, commits an offence, a very serious offence.


It might be very hard to catch him.

As regards the Senator's other question, we expect to grow about 1,000,000 lbs. this year, about 10 per cent.

That is interesting.

Bill reported without amendment. Report Stage fixed for Wednesday, 5th September, 1934.