Seanad Éireann debate -
Thursday, 20 May 1943

Vol. 27 No. 25

Creameries (Acquisition) Bill, 1943—Committee and Final Stages.

Sections 1 to 12, inclusive, agreed to.

Sir John Keane

I move the amendment in my name on the Order Paper:—

New section. After Section 12, to add a new section as follows:—

13. As and from the passing of this Act the company, together with its associated companies, shall publish annually an audited balance sheet and profit and loss accounts of their operations.

I think the House is aware of the arguments I have already advanced in connection with this matter. In fact, I mentioned them yesterday in the debate on the Finance Bill. I think it is improper that any Department of State should engage in trading with Government money, however small the amount may be, without publishing a record of its proceedings. For instance, we had the Dairy Disposals Board in being for a number of years, trading in its own name and in connection with a number of associated companies, and until pressed the other day in the Dáil no account has ever been given to the public of the proceedings of that body and, as I have already said, the account recently published is a very unilluminating document. I speak under correction, but I think that there is no other public body, dealing with large sums of public money, which does not publish an account of its proceedings, and I would ask the Minister to accept this amendment, the object of which is to ensure the publishing annually of the accounts of this company and its associated companies.

Minister for Agriculture (Dr. Ryan)

I ask the Seanad not to accept this amendment for the reason that this company differs very materially from other commercial or semi-commercial companies, or from any of the State companies that have been set up, such as the Sugar Company or the Electricity Supply Board. This was a company set up to hold certain businesses for a time before handing them over to other bodies, and I do not think it would be fair to publish all the workings of the company and so put them at a disadvantage in any negotiations that might be carried on. I think it will be admitted that it would be a handicap in the case of such negotiations, if the company were obliged to publish its separate trading accounts, balance sheets, and so on.

I mentioned on the Second Reading that it is intended to bring in a Bill to regularise the position of the Dairy Disposals Board. That Bill will be discussed in both Houses, and it can be considered whether it is wise to carry on for a considerable period, or whether an attempt should be made to hand over the creameries in the shortest possible time to farmers' groups. I think that an amendment of this kind from Senator Sir John Keane would be very much more appropriately moved to that Bill if it does not contain anything satisfactory in relation to the publication of accounts when it comes before the House. The whole question of how long the Dairy Disposals Board is going to carry on will, I take it, be discussed at that time. From the point of view of legislation, too, I think a clause of this kind, if it were inserted by the Dáil or Seanad or both, would be more appropriately placed in that Bill.

Personally, I agree with Senator Sir John Keane that when the Bill comes before us, if it is not possible to give some sort of idea—not an undertaking exactly, but an expression of view— that these creameries should be held only for a short while; unless it were possible to assure the Dáil and Seanad that it was a transitory sort of company, I think the mover of the amendment would be justified in moving an appropriate amendment to the proposed Bill. I suggest that it is not appropriate to this particular measure, and that it might be postponed for consideration later. Perhaps I should answer one other point made by the Senator. It is true that the accounts circulated lately, or what might be called the consolidated balance sheet, were the first of the kind to appear. There is a certain amount of information given every year which will be found in the Report of the Public Accounts Committee, but I admit that that is not at all the information the Senator wants to get. It gives only the information of the transactions between the State and the company, the amount which the State has advanced, and the amount paid back by the company. It does not give information regarding the trading accounts of the company, or details of the balance sheet.

Mr. Foran

I want to put this question to the Minister: if he is not prepared to accept this amendment, will he tell the House in what way Parliament will be kept informed of the financial activities of this association of companies? Surely there ought to be some public way of making known the activities of the company?

Mr. Douglas

I was going to make a similar remark. Is there not a possible danger that an impression might be given that all the associated companies may not be economic? May not it be taken that something which applies to one or two may apply to all? I understand that some of these companies are doing quite well, but one might get the impression that they are all in a bad way.

Dr. Ryan

Senators will recognise that the board has to deal with various difficulties. Some of the companies have not been doing so well as others, and it is only because the Board has 16 or 20 properties where they can take one with the other that they are able to do better for some of the weaker properties than if they were taken separately. At the moment, they are all doing well and it has not applied so much in recent times. My principal argument is that this matter would be much more appropriately discussed when the Dairy Disposals Bill comes before the House.

Mr. Foran

The Minister has not answered my question. I asked in what way Parliament would be kept informed of the financial activities of this company if this amendment is not accepted. There should be a way of getting the information.

Dr. Ryan

I think the consolidated balance sheet gives sufficient information for that. In other words, the Dáil and Seanad get an idea that the Board at least has assets to meet its liabilities.

Sir John Keane

Without any definite enactment or without any statutory mandatory provision, can the issue of the consolidated balance sheet be continued? That would give nothing away.

Dr. Ryan

Yes, the consolidated balance sheet was issued first in 1931. It was not issued after that until now. I think that was due to an oversight, and I have made arrangements to have it issued yearly from this forward.

Sir John Keane

Under the circumstances, I am not satisfied that there is much use in my pressing the matter. For the time being I am prepared to await further information.

Amendment, by leave, withdrawn.

Title agreed to.

Agreed to take the remaining stages now.

Bill received for final consideration.

Question proposed: "That the Bill do now pass."

Mr. Counihan

I supported the Principal Bill and I am in favour of this Bill. I supported the Principal Bill when a number of representatives who are enthusiastically in favour of this Bill were opposed to that measure. I do not want to dwell upon that. No matter what Bills are introduced, not much will be achieved in improving the position of the dairy farmer until something is done to increase the milk yield and the health of dairy cattle. There are many matters which I should like to raise but I am told that they would not be appropriate to this Bill. I hope to deal with them on the Appropriation Bill.

A statement was made the other day by Senator Johnston definitely recommending the Minister and the Government to restrict or prohibit the export of heifers. That statement is on record. I should like to say, on behalf of the cattle trade, that we would be definitely opposed to any such restrictions and believe they would do more harm than good. I discussed the matter with Senator Johnston since he made the statement and he told me that he did not mean to put forward any such proposal, that it was a mistake to say that he wanted restrictions and that what he wanted was some means of increasing the number of dairy cattle in the country. I should like it to go on record, on behalf of the cattle trade, that the placing of restrictions on exports would do more harm than good to every section of the live-stock trade.

Sir John Keane

I should like to take this opportunity to reply to statements made during the Second Reading, particularly by Senator Lynch. Senator Lynch, who spoke in rather judicial, cross-bench fashion, said, in effect: "Surely it is right that the Government company should step in and promote creameries in Clare and Kerry when the co-operative movement failed to do so." To my mind, that is an entirely wrong view. The Government recognises the I.A.O.S. as a body charged with the duty of furthering co-operation. Not only is that recognised, but the Government gives the organisation a large subsidy for that purpose. Senator Lynch suggests that the I.A.O.S., having failed in Kerry, this body, which is a Government and proprietary body, should go in and do what is required. Why did the I.A.O.S. fail in these areas? Merely because it could not get adequate finance. Is it suggested that, if the I.A.O.S. had had similar finance to that which the Dairy Disposals Company had at its command, it would have failed? I venture to say that it would have done the work much more economically. All that the I.A.O.S. would have needed to promote creameries in the manner which the Dairy Disposals Company has done would be a bank guarantee. After a few years, I have little doubt that that bank loan would be repaid.

The whole idea in recognising the co-operative movement is to educate the farmer. The intention is not merely to give the farmer opportunities for selling his milk to a creamery; it is to provide an educational background for the farmers in running these establishments. The Dairy Disposal Company is nothing but a proprietary concern, acting in the name of the Government, and it is open to all the objections that applied to the old proprietary system which it was set up to liquidate. Whatever delay there may have been—and I think there has been culpable delay—in transferring the Newmarket Dairy, I think it is absolutely wrong that the Dairy Disposal Company should have gone out and, by proprietary methods, broken fresh ground and organised creameries, which is the work of the I.A.O.S. The I.A.O.S. could have done the work, with an educational background, if they had anything like the finance which the Dairy Disposal Company had. Even now, I hope the Government will allow the I.A.O.S. speedily to enter upon its proper function regarding the organisation of co-operative societies in rural districts.

If my information is correct, the Dairy Disposal Company has all the vices of a proprietary company. It adjusts its prices to meet competition from the other creameries. That was what the Dairy Disposal Company was set up to end. The intention was that creameries should be self-contained trading entities and pay for their milk what their trading permitted. I am sorry that Senator Lynch is not here, because I think he misconceived the whole background of co-operation. The whole purpose of co-operation is education. The Dairy Disposal Company is doing harm, because, with Government money, it is spoon-feeding the people and undermining the whole spirit of self-reliance which is the background of all co-operative effort.

Mr. MacCabe

Senator Sir John Keane is not possessed of the facts. There is a misunderstanding about the creation of the Dairy Disposal Company and its functions. The Senator referred to the statement made by Senator Lynch. I think Senator Lynch put the case very well. I agree with what he said. I have been a member of the I.A.O.S. for over 30 years.

I do not feel that at any time the I.A.O.S. was in a position to relieve farmers in the situation that was created in districts where the Dairy Disposals Board had to function. Were it not for the action of the Government and the Minister now present a number of small creameries would have been completely wiped out and the farmers and the guarantors to the banks would have suffered severely. The Government saw that there was no hope for the societies but to take them over and give them to a larger society, so that they would continue to work and, in all probability, would be in a position later on to repay the money granted them by the Government. The Government did not, as Senator Sir John Keane said, go out for the purpose of organising. They did it simply and solely to relieve struggling farmers. The Minister never said that he refused to hand over the creameries to farmers and co-operators in different areas, but would be prepared to give them back so soon as they repaid the money given by the Government. I am sure he stands by that. The Minister did a good day's work for the co-operatives by the action the Government took in certain areas.

As one who worked with a proprietary concern for years, I have a fair knowledge of the way in which they work. It was only by giving an inducement to the farmers to take over proprietary concerns that we succeeded in taking over 29 of them. Were it not for the courage of the people who consented to take shares, there would be none of them there now. The same thing would have happened in the last three or four years were it not for the action taken by the Government. As to the question Senator Sir John Keane raised about the audit of accounts, as far as I know, the Minister is prepared to agree that there should be an audit. The audit of accounts, so far as the Government loan is concerned, is a question for the Government itself, inasmuch as a certain amount of money is due to the Government at the end of the year. The other matter was one for the people concerned to have the balance sheet forwarded to the Registrar of Friendly Societies. I agree with every word Senator Lynch said in a previous debate. The Senator is not present, but in his absence I say that it was by far the best contribution I have heard for a long time in the interests of co-operation and of the country generally.

Dr. Ryan

I agree with Senator Counihan that a Bill like this is not nearly so important as far as the dairy industry is concerned as anything that might increase production, get more milk from the cows we have and keep cows in better health. One, however, is not exclusive of the other, and there is no reason why we should not pass this Bill in order to achieve its own particular purpose. A point was raised by Senator Sir John Keane as to whether the I.A.O.S., which is recognised and subsidised by the State, would not have done this business as well as the Dairy Disposals Board.

Sir John Keane

Excuse me, I only referred to the new creameries in Kerry and West Cork.

Dr. Ryan

Not to the taking over? I was going to say that, although I have never looked back over the Department's files, when this matter was being considered in 1927, the Department of Agriculture and the Minister at the time would have considered whether the I.A.O.S. ought to do it, or whether it should be done by an ad hoc company. The conclusion was come to that the Dairy Disposals Board should be set up for the purpose. The Board has succeeded in my opinion and I do not like to take the risk of changing.

I do not think there is the same objection to the Dairy Disposals Company as there would be to a proprietary company. It is true that they pay prices somewhat corresponding to those of surrounding creameries. Their object in doing that is not to make the pace too hot, as it were, for the surrounding creameries. A proprietary concern would be inclined to pay more, and in the case of creameries like those in West Kerry it would probably pay less. As a matter of fact, if anybody were to examine the prices paid in these various groups, they would find that higher prices are paid in Cahirciveen and Kenmare than are paid in the areas where they are surrounded by co-operatives. That goes to prove that the Dairy Disposals Board is trying to pay in a big group what that group will warrant, but, at the same time, not to pay more than surrounding co-operatives, where there are surrounding co-operatives, because they look upon themselves as trustees holding these groups for the time being, with the prospect of handing them back to the co-operatives at some future date. I do not think any other point was made that would call for a reply.

Question put and agreed to.

Ordered: That the Bill be returned to the Dáil.