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Seanad Éireann debate -
Thursday, 5 Aug 1948

Vol. 35 No. 10

Road Fund (Advances) Bill, 1948— (Certified Money Bill) — Committee and Final Stages.

Bill passed through Committee without amendment.
Agreed to take the remaining stages to-day.
Bill received for final consideration.
Question proposed: "That the Bill be returned to the Dáil."

I would like to refer to remarks made last evening, particularly those by my learned colleague, Senator Duffy. Both Senator Duffy and Senator Hayes attributed to me one of many qualifications that I do not labour under—that is, being overworked and being a constant reader of the Irish Press. I have no apology to make to this House or to the public for my contribution in establishing the Irish Press. I was one of those who, in the very early days, did what I could in that respect.

The establishing of the Irish Press has nothing to do with this Bill.

I understand that. On the Fifth Stage, a Senator has a right to reply to suggestions or accusations made on previous stages of a particular Bill.

On a point of order, we dealt with this matter in detail on the Fifth Stage of the Finance Bill. Surely the Senator is confined to what is in the Bill and cannot go back on the debates on the various stages— not that I begrudge him myself?

I would be the last person to try to overcome your ruling, but as an ordinary Senator I claim the right and justification to reply to the accusations levied.

No. I rule that the Senator is confined to what is in the Bill, on the Fifth Stage.

If you confine me to the merits of the Bill, the only next step I must take is to sit down—as there are no merits in this Bill.

If I have said that, will the Senator sit down?

Not at all. With all appreciation for the high office the Cathaoirleach holds, I suggest that he is not within his rights in suggesting that any Senator should sit down on an occasion of this kind.

The Senator suggested it himself. I did not suggest it.

I did not suggest anything of the kind. The suggestion first came from the Cathaoirleach. I will maintain that, as an ordinary Senator, it is my duty to express the views of the people who sent me here, on every occasion that the need arises.

Yes, dealing with this Bill at the moment.

Here is a proposal to enable the Minister for Finance to mortgage the future of the Road Fund This matter was first introduced in 1926 and the first step to implement the proposal was by the Cumann na nGaedheal Government which, in 1926, passed legislation to mortgage the future of the Road Tax Fund.

The Chair thinks this is a repetition of the Senator's Second Reading speech.

Much as I dislike to question the rights of the Chairman, I have a right and privilege on which I am going to insist. On the Final Stage of the Bill, the question before the House is that the Bill be referred to the Dáil for final consideration. I propose here and now that it should not be referred to the Dáil, that it is not a Bill which should be referred to the Dáil for final consideration, and I set that out on the following grounds. An Assembly of this kind should not empower the Minister to mortgage the future of this fund to this extent. The Bill proposes to take off general taxation something to which the people are justly entitled to make their contribution, that is, the roads of this country which were put into a condition of disrepair, not in the interest of any section in particular. I am not one who is a proud owner of a motor vehicle of any kind, but I am sure Senators who are in that position and who make their annual contribution to the Road Taxation Fund must demand from the present Government and any future Government their just rights. They are contributors to a fund to build up the roads to enable them to carry on their various activities, whether for business or pleasure. The Bill proposes to mortgage the future of the fund.

I would like to ask the Minister just one very serious question. What is the annual contribution from that fund? We are giving the Minister in this Bill power to advance to our local authorities £3,210,000. I am sure the Minister will agree that the figure of £5,000,000 is more or less misleading, as the fund has been mortgaged already to the extent of £2,000,000. By whom has it been mortgaged? How has the money been spent? It has been mortgaged by and during the term of office of the régime we have here at present. It does not matter whether you call it Fine Gael or Cumann na nGaedheal— it is the same régime.

Senator Duffy, quoting from the Irish Press, said last night that a raid had been made on this fund. No raid has been possible. What is really done and what is proposed in this Bill is not a raid on the fund, but a mortgage on the future of the fund. That is one of the things to which we in this House should not be a party.

During the emergency the people in towns and cities were dependent on rural Ireland for their food and fuel— dependent on the workers for whom we were proposing last night a week or a fortnight's holidays. The roads of the country were torn up and got into a state of disrepair during that period because of three things: first, the lack of materials; secondly, the employment of our people on the production of the things essential to the maintenance of the position we occupied at that time; and thirdly, the need to maintain our people in the cities and towns. I do not propose to go over again the quotations which I gave last night, but we have it on the authority of the Taoiseach, who quoted from a minute of a Cabinet meeting held by the Fianna Fáil Government, that it was their intention that a sum of about £2,500,000 would be made available to the local authorities to enable them to put our roads back into the state of repair in which they were before the emergency.

The Minister may, and I am sure will, say that there was no definite decision at that meeting, but he told us a very interesting story last night. He told us that, while that Fianna Fáil Cabinet meeting was being held, at which the Government were considering what might be done to maintain and improve the roads, another meeting was being held, and that, as a result of that other meeting, held behind closed doors, and the bargain entered into at that meeting, we have to-day the present state of affairs. I pride myself on having drawn the statement from the Minister that, as far back as 13th February, negotiations were entered into and decisions made as to what was to be the composition of the future Government, by the present Cabinet. I assume that, as a result of that discussion behind closed doors, there was an allocation of Ministries——

The allocation of Ministries has nothing to do with the Bill before the House. I suggest that the Senator keep to the terms of the Bill.

I hold that the allocation of Ministries has something to do with this Bill, because, if that allocation had not taken place, the Minister would not be here to present this Bill.

It has nothing to do with the Bill before the House and I remind the Senator that he must keep to the terms of that Bill.

These are things we do not like to refer to.

I was very much intrigued by a statement of a leading member of the Labour Party, who claimed credit—and I am sure that, at some time in the very near future, a monument may be erected to him—on behalf of the workers of Ireland for having placed in the very important position he occupies to-day no less a person than the Minister for Finance. That was the claim put forward by him.

He will be in the next honours list.

What has that to do with the Road Fund Bill?

The monument might be paid for out of the Road Fund.

Does Senator Hayes suggest that I should address my remarks to the Road Fund or to the statements he made last night? On the Second Reading of this Bill, in reply, I assume, to the statements I made, he suggested that I was over-worked——

I did not speak on this Bill at all.

——and that I was a constant reader of the Irish Press.

I did not speak on this Bill at all.

The Senator has not spoken on this Bill.

May I apologise to the Senator for suggesting that he reads the Irish Press? I withdraw it.

Senator Duffy followed on much the same lines as Senator Hayes.

Senator Hayes did not speak on this Bill and the Senator might accept that statement.

I am prepared to accept it, seeing that he has already spoken about six times since I got on my feet. One of the things I do not like to do is to interrupt any speaker, no matter how much I disagree with his statements. We are here in a very free Assembly and a very good spirit has prevailed in our time. I should like that spirit to continue. I should like now to refer to a statement made last night by Senator Duffy.

Dealing with the Road Fund Bill?

I appreciate that you, Sir, are very anxious that I should get back to the Road Fund Bill.

At the same time, while accepting your decision, I hold that a member has, and must have, the right to address himself to remarks made on the Second Stage if we are to maintain the rights of the individual.

The Senator may not go back on statements made on previous stages of the Bill. He must confine himself to discussing the Bill on the Fifth Stage.

That being the case, I want to give notice to the House that I propose to raise the matter on another occasion. I accept the ruling of the Chair on this occasion with reluctance, and, as I say, I give notice that I propose to raise the question of the rights of a member of the House. We have been put here not by the people of the country but because of undertakings entered into, as I now understand, not on 18th February, but on 13th February. We have that definite statement that the present Government was set up, not on 18th February, but on 13th February.

I remind the Senator again that the establishment of the present Government has nothing to do with the Bill. If the Senator will not confine himself to the Bill, I must ask him to sit down.

That is one of the things I do not propose to do. I will address myself to the Bill. As I have said, I propose to question the ruling of the Chair in this connection in another place and on another occasion. I am sure the Chair will agree with me that there are certain rights and liberties which must be maintained.

The Chair is always very anxious to give full rights and liberties to every Senator.

I will address myself now, so far as I am capable of doing so, to the Bill. The proposal before the House is that this Bill be returned to the Dáil, and I propose to put before the House a few reasons why it should not be returned to the Dáil and why the House should not pass it. I propose to put forward reasons sufficient to influence you, Sir, into allowing me to continue my speech. Have Senators seriously addressed their minds to the question which the Bill raises? We are mortgaging the future of a fund over which we have no control.

The Senator has repeated that three times already.

I have not. This is the first time I have mentioned that we make provision in this Bill for something which is not before the House. We are empowering the Minister to mortgage the future of the Road Fund to the extent of £3,210,000. I have asked the Minister to give us a statement as to the annual contribution to the Road Fund and as to the number of years covered by this mortgage. We know that, from 1926 to 1931, this system of drawing from the fund continued, and that, on the advent of a Fianna Fáil Government, when it was proposed to engage in road development on an extensive scale, there was no fund, because it had already been mortgaged. Senator Duffy told us about the raids on the funds in various years. I remind Senator Duffy that during the régime of Fianna Fáil all the moneys drawn from this fund were utilised, not for the relief of taxation, as he put forward last night, but for the development of our roads, our main and county roads and on our employment schemes, and I am sure that Senator Duffy will admit, when he reads over his statement, that the statement he made was misleading, that the people who supplied him with the information misled him, because whatever moneys from the Road Fund were utilised by the former Government were utilised not for the relief of general taxation but for the improvement and development of our roads.

It is so.

No. A sum of £900,000 was paid into the Exchequer.

In the years 1938 to 1948.

What was the expenditure on road development and improvement and minor relief schemes?

That is a different matter.

Of course, the Minister will not answer that question.

I have not got the particulars with me, but I can get them. The fact, however, is that £900,000 was lifted from the Road Fund for general Exchequer purposes.

The Minister knows that all the moneys advanced by the previous Government were utilised for the development and building up of bog roads and county and general roads.

No moneys as was suggested were taken out of that fund for the relief of general taxation and I am sure that when the Senator realises the irresponsible nature of his statement, he will be anxious to withdraw it.

I do not propose to deal with the points made by Senator Hawkins. I am concerned with one matter, with the rate of interest at which these advances will be made by the Exchequer to the Road Fund. That is a very important matter because, as I understand it, the actual advances which will be made under this Bill will amount to about £2,790,000. Already a sum of £210,000 is available by way of advances.

The figure is £3,210,000.

Yes, that is the total amount that can be advanced under the Bill. If the Minister is prepared to make those advances at the rate of one per cent it would cost the Road Fund about £85,000. In other words, they can get £3,000,000 now for capital development, for the remaking and rebuilding of roads at less than £100,000 per year, if the Minister makes it available at one per cent. That is considerably less than the sums withdrawn from the Road Fund by the previous Government for Exchequer purposes.

Will Senator Hawkins listen? He has examined nothing in relation to this Bill. I must ask him to read the speeches of the Ministers for Finance in the Fianna Fáil Government.

Quote them.

I am asking Senator Hawkins to read them. We gave him 24 hours from last night in which to prepare his brief, and I was hoping that he would read the speeches of Deputy Aiken, a former Minister for Finance, and of Mr. Séan T. O'Kelly, the President, also a former Minister for Finance. Each of them made statements in which they asserted they were taking money from the Road Fund for specific purposes and they gave the purposes. In 1936-37, £100,000 was taken by way of advances from the Road Fund and put to this Exchequer Extra Receipt for Vote 73 for unemployment schemes but not necessarily for roads. I do not deny that the money was spent on roads, but I do not know how it was spent. All I know is that the money was assigned to the Minister for Finance and put into the Exchequer Extra Receipt for Vote 73. In 1937-38 the Minister for Finance again withdrew £100,000 and put this money into the Exchequer Extra Receipt for Vote 69 which has also to do with relief schemes or some kind of employment schemes.

What did those people do?

I am giving Senator Hawkins the facts. These are facts as set out by the Minister for Finance when asking Dáil Eireann to approve of a motion for his taking £100,000 from the Road Fund and attributed in various ways to the relief of taxation. There was no pretence from that day onward that the Minister was raiding the Road Fund for the purposes of using the money for anything in relation to unemployment or in relation to relief schemes. In 1939 the then Minister for Finance took £150,000 for the general purposes of the Exchequer, as stated by himself. Senators can read the Budget speech, in which it was admitted by the Minister that this money was taken out because there was no opportunity of using it then and that it was taken away to relieve general taxation. In 1940-41 he again took £100,000, not to build roads or for the purposes of repairing bog roads, but for the relief of taxation, in order to relieve the income-tax and the surtax payers. These were the people who got the relief. In each of the subsequent years, 1941-42, 1942-43, 1943-44 and 1944-45, £100,000 was taken away from the Road Fund for the purposes of general taxation. Nothing was taken away in the years 1945-46 and 1946-47, but the former Minister for Finance, Mr. Aiken, took away £200,000 in 1947-48 for the purposes of the Exchequer. I am addressing a question to the Minister for Finance in relation to the rate of interest because if the Minister can give these advances to the Road Fund at a rate of even 2 per cent., it would cost the Road Fund less than the raids made upon it by his predecessor for the purposes of general taxation.

Senator Hawkins disagrees, but there is no use in his pretending, by shaking his head, that those are not the facts. They are the facts and they are incontrovertible. It is not because I want to contradict or correct Senator Hawkins that I am giving these facts, but merely for the purpose of getting some assurance from the Minister for Finance that advances given under this Bill for the purpose of the Road Fund will be advances at a reasonable rate of interest and to ensure that the Road Fund is not going to be saddled with paying high rates of interest to the Exchequer. I am not concerned with refuting Senator Hawkins' charges. Most of them were made because he did not take the trouble to check the facts. Certainly I would not accuse the Senator of misleading the House knowingly, but he did attempt to mislead the House without making himself conversant with the facts. I think that what I have said here cannot be challenged. I am not making these assertions for the purpose of challenging what has been said by Senator Hawkins, but for the specific purpose of ensuring that the Exchequer is not going to make a profit at the expense of the Road Fund. In other words, that this £3,000,00 will be advanced at a normal rate of interest and will not impose an undue or unfair burden on the Road Fund.

There is an aspect of this Bill that I have not heard satisfactorily discussed yet and that is the aspect of motor taxation. I wonder can the Minister assure us of the policy of the Government in regard to motor taxation as a consequence of this Bill. Quite recently we motorists have suffered a very considerable increase in the annual taxation of cars. It has been very excessive on some of us, particularly those of us who have old cars, with the problem of their disposal. It has also affected those who do not own cars because industries and businesses who have lorries have imposed a minimum delivery charge which many think was not justified. I would like to know if, as a consequence of this Bill, there will be further taxation. That is very important for people with secondhand cars in particular. I hope that the Minister will consider returning taxation to its ordinary level.

There is nothing about taxation in this Bill, Senator.

No, but the moneys concerned are the proceeds of car taxation.

If I may answer the last speaker first, this Bill has nothing to do with road taxation of motor vehicles and what is being drawn from the Road Fund this year is on the basis of existing taxation which we are carrying on. I am not prophesying in regard to the future. I do not know what the cost of making the roads in the future is likely to be and I do not know the rate at which cars will come on the road or what new registrations will be like. But the Road Fund looks pretty healthy at the moment. Because of the great relief, however, that this will mean for local areas it will be a big burden on the fund. The periods of repayment or the interest payment periods have not yet been decided but there is no prospect of advances at less than I per cent. or anything like it.

At 2 per cent.?

The loan rate of the Department is 3¼ per cent., and that is the point at which the State can borrow. I would like to remind Senators that local authorities are now getting 65 per cent. of all their own charges from the Central Fund, whereas pre-war local authorities were aided only to the extent of 19 per cent. To-day local authorities are getting an enormous subvention. With regard to the controversy between Senator Duffy and Senator Hawkins, as far as my information goes, I must side with Senator Duffy. The moneys that were drawn out of the Road Fund were drawn for the purposes of the general Exchequer, a total of £900,000. In only two years the money was appropriated to employment schemes, but I must say it was a peculiar device if it was spent on roads, because the money was drawn from the Road Fund, which was for the purposes of maintaining the roads and devoted to employment schemes which included a certain amount of road work.

But the Minister will admit that it was utilised for the purposes of roads.

I do not. It was used for unemployment schemes and these may have included some road work, but even leaving out those two years a sum of £900,000 was raided out of this fund for general Exchequer purposes, for the relief of taxation. I do not regard this as an evil. It is ridiculous to suggest that in 1932 the Road Fund was so mortgaged that there was no money available for expenditure on the roads. I have not the full records of the previous years before the critical year of 1932, but I do know it would look as if from 1926 to 1932 there was no requirement as to the repayment of advances. All that was asked for was the payment of interest.

The first funding operation, as far as I can make out, took place in the year 1933, but it is completely ludicrous, and, of course, the statement was made without any basis of fact, to say that there was no money in the Road Fund, that it was all mortgaged for the repayment of advances. The thing simply could not happen. In any event, there is no evidence that it did happen. All the evidence is to the contrary.

If the rate of interest was 3¼ per cent., and if the annuity period was ten years, then, on a borrowing of £3,000,000, the annuity would be in the region of £360,000—something short of that. On a £2,250,000 borrowing it would be about £250,000.

Question—"That the Bill be returned to the Dáil"—put and declared carried.
Ordered: That the Bill be returned to the Dáil.