Seanad Éireann debate -
Thursday, 3 Mar 1949

Vol. 36 No. 8

Local Loans Fund (Amendment) Bill, 1949—Second and Subsequent Stages.

Question proposed: "That the Bill be now read a Second Time."

Minister for Finance (Mr. McGilligan)

The purpose of this Bill is to enable further issues to be made by the Local Loans Fund for the particular type of loans which it finances. This fund was established as far back as 1935, and at that time the issues were limited to the sum of £5,000,000. A guarantee was given that, if the requirements outdistanced that sum, new legislation would be brought in. That new legislation was brought in twice since—once in 1937 raising the limit to £11,000,000, and, by a later amendment in 1940, raising the maximum to £17,000,000. That is the point at which it now stands. That limit has been pretty nearly reached and it is necessary to have it extended. This Bill provides for an extension to the £25,000,000 mark. The extra £8,000,000, as loans are going at the moment, should meet the requirements for not longer than a period of three years. After that, further legislation will be required.

Out of the £17,000,000 to which the fund is confined at the moment, issues up to the end of January of this year amounted to £16,861,612. Of that, three-quarters was for housing loans. A sum of £12,000,000 odd went to this purpose and the division of it was that urban housing took about £4,750,000 and rural housing £6,250,000. Under the Small Dwellings Acquisition Act, £915,000 odd was advanced and, for Gaeltacht housing, something over £87,000. Public Health loans accounted for £3,000,000 odd and vocational education loans for something short of £600,000. For other services, an amount of something short of £400,000 was left.

There was an extraordinary provision made in one year, 1945, when there was a temporary advance made under the Finance (Miscellaneous Provisions) Act of that year of a sum of £780,000 in connection with certain stock redemption operations. It was an abnormal matter, dealt with by a special piece of legislation that year, and is not likely to be repeated. Since the end of January, there have been certain further issues and the aggregate at 1st March was about £50,000 short of the limit, so that it is quite clearly necessary to have this extension granted.

Mr. Hawkins

We do not propose to hold up the passage of this Bill and we are prepared to give all stages this evening. I was very pleased to hear the Minister give the figures of loans made available in recent years for housing, for one particular reason, that the belief has been held in many quarters, and many statements both made and written, that in our housing drive we completely neglected rural Ireland. From the figures, we now see that the reverse is the case, over £6,000,000 having been spent on the erection of houses in rural Ireland as against £4,000,000 in urban areas. This amount, of course, does not represent the total amount spent on housing, because the local authorities from the rates put up a certain amount of money, and, as well, many local authorities borrowed from other sources.

While we are pleased to have the information that a further sum of £8,000,000 is being made available, it would not be out of place to draw the attention of the Minister and the House to the ever-growing burden being placed on our local authorities. Every piece of legislation introduced passes some part of the burden on to our local authorities and, within recent weeks, we have seen an example of that in a discussion which took place in the other House, which I do not propose to go into here. We have had throughout the country an increase in rates, and I appeal to the Minister— I am sure that other members will join with me in making the appeal—to realise that, while local authorities are prepared to face up to their obligations, the time has come when greater assistance will have to be afforded from the Central Fund to enable them to provide the many social services which are being demanded of them in present conditions. Even if it involves taxation, it is much easier to pay taxation than it is to pay it in the form of rates. Rates have to be paid in large instalments, while direct taxation is paid in such a way that it does not fall so heavily on the individual.

I appeal to the Minister, in considering the assistance to be given to local authorities, to bear that fact in mind. The local authorities are prepared to play their part and the people are prepared to help in the carrying out of these schemes. If we are to solve the many problems facing us—if we are to stem the tide of emigration, for which the figure this year is 40,000 people and reduce our high total of 84,000 unemployed—if these two great evils are to be combated, we must be prepared to embark on greater expenditure and induce our local authorities to go ahead with housing and the other various schemes they have in hands. If that is to be done, however, the burden must not be placed entirely on the local authorities. The State, through the Central Fund, will have to come generously to their aid, if these problems are to be solved.

Mr. McGilligan

The Senator has referred to unemployment and emigration and has suggested that the spending of more money might ease the situation. I mentioned in the Dáil already, and I want to put the figures on record here, that the Exchequer receipts and issues statement which is published week by week shows that, in what we call the below the line services, there has been spent, from 1st April, 1948, to 26th February, 1949, something a few thousand pounds short of £8,000,000. The year before, the figure was something a little short of £5,000,000, so that over £3,000,000 more was spent in the past year. If I cut out the amount of money in the under the line amounts related to air navigation and transport, which mainly relate to the purchase of certain machines, which had no relation to employment, there has been spent this year a sum of £4,174,000 more than last year. It is certainly not for the lack of spending that there is any increase either in emigration or unemployment.

The Senator made a request that the Central Fund should come to the aid of the ratepayer. In pre-war days, in respect of rates the local authority contributed £2 for every £1 the central authority put up. At the moment, the local authority is contributing £1 for every £2 the State puts up. There is a complete change there. So far as housing is concerned, in those under the line items I mentioned, there appears under the Local Loans Fund £1,646,000 as against nothing the year before. The nil item occurred in this way, that there was a repayment of principal occurring from earlier loans and that being ploughed back precluded the necessity for any moneys; but the money that is being expended on housing this year outruns all the return of principal by £1,646,000. It is expected, on the information I have, that the next year the outflow from this Local Loans Fund will be in the region of £3,500,000. If anyone can say there is a lack of spending, after these figures, I would like to know what his idea of spending is.

Senator Hawkins' new idea—new in his case—is that it is easier to pay taxes than rates. I always thought the old slogan was that you "paid your taxes in anger and your rates in sorrow." At any rate, that was the way the two things were divided before.

Question put and agreed to.

Agreed to take the remaining Stages to-day.

Bill passed through Committee without amendment, received for final consideration and passed.

Ordered: That the Bill be returned to the Dáil.

The Seanad adjourned at 4.15 p.m.sine die.