Supplies and Services (Temporary Provisions) Act, 1946 (Continuance) Bill, 1949—Second Stage (Resumed) and Subsequent Stages.

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

Mr. Summerfield

I was somewhat alarmed to find the extensive range of controls which it is sought to continue under the aegis of this Bill. We will all agree, of course, that where control is necessary to cover goods in short supply there is an unanswerable case to be made for retaining those controls. I find it hard to find any defence for the continued control of articles that are in fact not in short supply. In introducing this little measure the Parliamentary Secretary indicated that in the case of some primary essentials, such as bread, butter and so on, it was not so much a case of shortage as to ensure that the amount of subsidy paid by the State on some of these articles would be maintained at its present level. I think I interpret the Parliamentary Secretary aright in that he indicated that if controls were removed greater subsidies would be paid. I would have wished that the Parliamentary Secretary—because I am prepared to be convinced by him—would have brought to the House some figures indicating whether the extra cost of subsidy which would follow the removal of controls would be greater or less than the continued cost of administering the controls themselves. I think the House would have been interested to have some figures of that kind.

There is one form of control that I suppose I am expected to deal with. I am rather glad that Senator Bigger did it before I did. I refer to petrol rationing. I will ask bluntly, are we retaining this in the interests of our own economy or in that of Great Britain? I have maintained over a period of time—because of information I was given—that this country could in fact get all its petrol needs from sterling sources. If that is true, it means that portion of our accumulated millions of money in London is in fact frozen when we want to get this vital commodity, because it is a vital commodity in our community. We are, of course, linked with sterling. Does it mean we are linked to English economy also? I think we are in grave danger of that and it is something which I should dislike. They have a type of Government which would not commend itself to the majority of people in this country, and I fear—and I say it deliberately—that we are in danger of being tied, and that in fact we are tied, to England's economy for her own purposes. This matter of the acquisition of petrol is one indication of it.

Senator J.T. O'Farrell raised a hare when he said that we were already importing too much petrol into this country, that we are using too many motor vehicles. I thought that came very badly from a man who, by reason of his long association with the trade union movement, spent so much time in trying to raise the standard of living in this country. In recent years, democracy has been given many meanings and he now evidently gives it a new meaning—to deny to the other fellow that which does not appeal to yourself. That is what his argument seemed to be, because it was not based on either reason or anything else I could discover.

It might be interesting for the Seanad to hear that the motor vehicle population of this State compares very badly with that of other countries. I will give only a few instances. In Iceland, there is one motor vehicle for every 13 of the population; in Great Britain, one for every 18 of the population; in the Six Counties, one for every 22 people; in France, one for every 24 people; and in Denmark, one for every 26 people. We come well down the list with one for every 33 people, and that includes trucks. If I gave the analysis as relating to cars alone, the disparity against us would be seen to be much worse than these figures indicate. In any case, have I to defend the fact that a good percentage of the people want an amenity which is now accepted as part of world civilisation, the motor vehicle? I think it absurd to suggest that I should have to argue it.

Senator Bigger dealt with the quality of the petrol and this is a matter about which the House ought to know something. The bad petrol is due to the fact that this year alone 1,500,000 gallons of potato, alcohol have been put into the petrol which the public have had to use. This is the product of our five alcohol factories and those 1,500,000 gallons of industrial alcohol cost the petrol companies 5/6 per gallon, which meant a charge on the price of petrol of 1½d. per gallon. I seriously suggest that it would be better economy and better all round to scrap this potato alcohol business and to devote the factories to the production of the cement that we are going to need in the great housing drive. The motorist would be better pleased to have to continue paying the 1½d. extra, if he got pure petrol. If the potatoes are not fit for human consumption, they can be used for feeding pigs.

Amongst other things which Senator J.T. O'Farrell said was that the removal of controls inevitably meant an increase in price. It is a pity a man should say a thing like that in so reckless a fashion. The removal of control can lead to an immediate increase in prices of goods that are in short supply, but a general statement like that of so dangerous a nature should not be broadcast. Where there is a free flow of goods, you need no control of prices, and it is absurd to say in a general way, as though it were dogma, that controls are necessary to ensure fair prices.

I must deal also with one other point he made because he argued that our present price control machinery was inefficient. It is a pity the Senator is not in trade, because he would then know how efficient it is, and I pay that tribute to the Parliamentary Secretary's price control division. He argued that it could not be effective because there was no consumer connected with that price control machinery. What in the name of goodness are the manufacturers, the shopkeepers and the traders of this country, if they are not consumers? In addition to being consumers they have a specialised knowledge of manufacturing, distributing and trading problems and handicaps, which no ordinary consumer of the type indicated by Senator J.T. O'Farrell could ever hope to have. We do not need more controls and we do not need more "snoopers"—we want less of them and less interference with business. You will then find that prices will come to a healthier level and the country will make greater progress.

Professor O'Brien

I recognise that the prolongation of this legislation is necessary in the circumstances of the times in which we live, and I agree with Senator Hawkins that it is a melancholy reflection on the condition of the world that, four years after the cessation of hostilities, controls of this kind should still be necessary, even in a neutral country. Those of us who are old enough to remember the circumstances of the first world war cannot help feeling that there is a sad comparison between the circumstances of 1922 and those of 1949. By 1922, the economic system in England and Ireland had recovered a great deal of its resilience after the disturbance of the war. In 1949, it scarcely has recovered its resilience at all and still requires a large amount of regimentation and control. One hesitates to think of the amount of damage that would be done to the economic system of Europe in the event of a third world war. The second world war reminds one of the effect of recurrent bouts of pneumonia on an ageing patient— the powers of recuperation are becoming less and less on the occasion of each bout until finally a bout comes which proves fatal to the whole organism and our civilisation is destroyed.

I am quite prepared, therefore, to admit that a continuation of this Act is necessary in the circumstances of the time and I also think that the Parliamentary Secretary is entitled to some congratulation on the operation of the Act because, if it had not been for the Act, the cost of living would have been higher even than it has been. Both the Act and its operation have reflected credit on the Government who have administered it. At the same time, the Parliamentary Secretary will agree, and has agreed in his opening statement, that the prolongation of these controls is most undesirable and that the period for which they are prolonged should be reduced to the bare minimum.

This Supplies and Services Act covers an extremely wide field. Under it the Minister has power to interfere with almost every branch of the economic system. By virtue of price control, exchange control and building control, the Government is given a degree of authority and planning which, to a very large extent, removes the spur of enterprise nature from our economic system. It is admitted by the Parliamentary Secretary that this is most undesirable, and I think that if, this time next year, it appears that these controls have to be still further extended, there is an overwhelming case in favour of setting up some more legalistic and defined machinery for these controls than the extremely loose machinery at present employed. From the constitutional point of view, it is very undesirable that our rights and duties as citizens should be subject to this control under the Act, this very wide measure of indiscriminate control which has resulted in a flow of Orders and papers which makes it extremely difficult for business people and the ordinary citizen to know exactly where they are.

I have the privilege of being a member of the Committee of the Seanad which is examining Statutory Rules and Orders. This morning we examined some Statutory Rules and Orders made under this Supplies and Services Act. Some of them are almost constitutional curiosities and we draw attention to them in the report which we are laying before the Seanad. There were three Orders brought before us under this Act which even the most skilful lawyer could not possibly interpret without extreme research amongst a number of statutes and previous Orders. There was nothing in the title to indicate what the subject matter was and in one case, even the body of the Order was all a matter of reference. One was referred back to an obscure section of the Petty Sessions Act of 1851 and one would have had to refer to certain United Kingdom statutes if one had not the services of an official of the Oireachtas to tell one what it was about. I suggest that from the constitutional point of view that type of legislation is extremely noxious and that type of interference by the Government with individual citizens should not be prolonged one single day beyond what is essential.

I think the Parliamentary Secretary should give the Seanad an assurance that if the economic position of the country and world conditions are such that this type of interference is required it will be put on a more defined basis and that statutes will be passed defining the area of interference and taking away a great deal of the complete discretion which at present prevails under the Supplies and Services Act. The Orders under this Act are a small example, we are told, of a number of Orders made during the present year, some dealing with the penalties to be imposed by the courts of petty sessions and others dealing with a wide diversity of things which by no ordinary interpretation could be brought under the appellation "supplies and services". Under this Act, the Minister has power to regulate practically every action of the individual. From the constitutional point of view, that is extremely objectionable and I am sure that the Parliamentary Secretary would be the first to agree that this is a type of interference which should either be abolished or, if it has to be continued, put on a much more constitutionally satisfactory basis.

I agree with Senator Summerfield about the dubiety of the necessity of continuing to ration commodities simply because they receive a subsidy. In the debate in the Dáil, that seemed to be taken as self-evident by the defenders of the Bill, but I do not think it is self-evident. The example of petrol has shown that when an article becomes plentiful the consumption does not very materially increase. As Senator Summerfield has said, once supplies begin to flow in, once there is something like a reasonable supply, the necessity for rationing disappears, and I think that would be found to be the case in regard to other subsidised commodities.

The Parliamentary Secretary, I suggest, should attempt to give an answer to the question asked by Senator Summerfield, whether there is reason to believe that if subsidies had to be paid on an article which was de-rationed, the cost would be more than the cost of administration, the cost of keeping this elaborate machine for the rationing of commodities which are becoming in more and more plentiful supply. Again, from the constitutional point of view, unless there was a very material saving financially, there is a great deal to be said for letting the whole apparatus rest for a while and letting the free pricing system function again. There are two forms of rationing, rationing by decree and rationing under the free pricing system. One of the functions of the free pricing system is to ration supplies of commodities between various competitors. It is only in war time or in a state of emergency that this extremely competent, efficient and silent system of rationing has to be replaced by the very costly, roundabout and very bureacratic system of rationing with which all of us, unfortunately, are only too familiar. Unless there is a strong financial argument in favour of keeping the present system going, from the point of view of the freedom of the individual and from the point of view of allowing rationing by allocation among the competitors, there is a great deal to be said for loosening the whole machine and letting the normal rationing apparatus of peacetime society come into operation again.

One device has been introduced by the present Government of which I would like to express my approval, that is, the two price system. It guarantees a certain amount on the ration and people can then obtain more, if they wish, off the ration at a higher price. That is a type of compromise between non-rationing and rationing that might possibly be extended. It seems to me from what one hears of what is going on in the neighbouring island that the lack of purchasing power of money is a very serious hindrance to incentive. If people are not able to obtain things they want with the money in their pockets, they have not the incentive to earn money which is necessary in a free society and I think it was very wise to bring in the two price system. It has given people something to do with their money. It provides an incentive, this "rationing by purse" as it is called by the critics of the system. When all is said and done, however, unless you have a system of complete egalitarianism in all directions, a system almost communistic in its egalitarianism, as long as you need the incentive necessary to spur people to enterprise, the people must be allowed the good things of this world in unequal quantities. The strict rationing of all the necessities of life has introduced a type of egalitarianism which is very noxious in some of its results. I would suggest to the Parliamentary Secretary that a loosening of that system might take place to some extent through the extension of the two price system.

Having said so much, I do not intend to delay the Seanad further. As I said at the beginning, I accept the unfortunate necessity for the prolongation of this Act for another year, but I hope that this time next year, if it has to be continued, at least this great area of discretion which is in the hands of the Government will be substantially reduced.

Mr. S. O'Farrell

It is well to hear so notable an economist as Senator Professor O'Brien approve of the two price system. This system has been attacked, but it was not a logical attack. It was attacked for reasons other than that the system itself was good or bad. The system is good and it is not quite new. It is essential at the present time and is an injustice to nobody. As long as the two price system lasts you will have rationing of some sort, because it could not operate without a rationing system. When you have rationing and the two price system you guarantee to everybody a minimum of what are considered to be essential goods at the minimum price. Anyone who wants more and is willing to pay for it can do it off the ration and without a subsidy. Rationing did not begin with the war and there is no prospect that it is going to end even this length of time after the war. Rationing has operated through a diversity of prices always and always will. Never in my lifetime was there a rationing of fur coats or of motor cars, but my wife has no fur coat and I have no motor car. We are very effectively rationed by the prices, but we are treated fairly in the matter of bread and butter and such things. We can buy a reasonable supply, the same as is given to every other citizen, at the same price as is paid by every other citizen. It is no injustice to anybody that those who want to buy high-priced flour should do it without subsidy from the State. The same system obtains, in my opinion, in the case of houses. The Government subsidises houses of a certain type and anybody who does not want that type of house or who wants a better price house can buy it but without a subsidy. The principle is the same and it was adopted before this Government came into power with the differentiated tax on tobacco and on hard plug tobacco, which was supposed to be the last consoling comfort of the aged and poor, and was allowed to be sold at a lower price than any other sort of tobacco. I think the aged ailing poor might have got a better type of tobacco than hard plug; it is tough stuff to smoke. No one wants rationing for the sake of rationing, but one cannot have normal conditions in these abnormal times.

Since this Bill covers so many things, it might be possible to take a broad glance at the general conditions at the moment. I am not making any complaint or demanding any immediate explanation or remedy, but it seems to me that some examination or explanation is necessary in some cases. Senator Hawkins referred to the different prices for tea—tea on the ration and tea off the ration—but it is strange that either way it costs more than in England. I do not know whether it is true or not, but it is alleged that we have to buy all our tea through the British Government. I doubt if that is still the case, as I have seen a reference recently to the fact that we got in tea direct from Indonesia on the 24th July, 1948, and the price at which it arrived here, plus carriage, would be about 2/6 a lb. In May last—I understand from the same article—another direct shipment was made from Indonesia. If it is possible for us to import our tea direct at that price, it must not be the case that we are compelled to buy it through some British agency and pay 1/- a lb. more for it than is charged to the British consumer. That is the allegation, but I do not know how true it is.

When talking of flour and the different grades and the purposes for which it can be used, Senator Hawkins mentioned that there was a differential price for flour for biscuit making. It may interest Senators to know that, in the Irish Press of the 26th October last, in the “Market Survey from London”, it was stated that Jacob and Company, Dublin, had transferred the whole of their export trade to a Liverpool company. I do not know whether they asked permission of the Government to do that or not. I know that the export trade of Jacob's was worth over £500,000 to this country a year at one time. I know that their biscuits could be sold in the United States, Canada and other countries, which would bring in currency that we need here. There may be a good reason why an Irish firm—built up by Irish capital and Irish labour, which developed a good name and reputation for itself abroad and which could supply biscuits to the ends of the earth—should suddenly and secretly transfer the whole of that trade to a Liverpool firm. The Liverpool firm, although Jacob and Company, too, I learn is in no way affiliated to the Dublin firm, although each of them guarantees the other's preference dividends for 21 years from 1933. On the 26th or 27th of October last, the Liverpool firm offered 100,000 5/- shares in the Liverpool company. I understand that the shares were bought up before they were offered, and that they were available to ordinary people in the market at over £1 apiece the following morning. There must be some asset in the Dublin Jacob's foreign trade.

I got a friend of mine—as I am too well known as a crank to be trusted by firms—to draw Messrs. Jacob's attention to this report in the Irish Press—which did not get as much publicity as it deserved. He wrote on the 27th October, asking whether the announcement in the Irish Press was correct and whether they had anything to say. On the 28th October, Jacob's replied. The letter was written by the secretary, Mr. W.F. Bewley:—

"In reply to your letter of the 27th inst., we may say that the announcement in the Irish Press on the 26th October, which you referred to, is substantially correct.

Owing to various difficulties, it was found impossible to resume the export trade from Dublin after the war and it was, therefore, assigned to the Liverpool company under a five-year agreement. In the meantime, we are, therefore, precluded from dealing directly with the countries you have mentioned—the United States, Canada and others—and are confining our trade to the Twenty-Six Counties."

Even the six northern counties are no longer in Ireland, so far as Jacob's are concerned; and it takes a Liverpool firm, according to that letter, to supply them.

I do not suppose the Minister had any power to stop them, if he were aware that this was happening; but whether he had power to stop them or not, I think that, since the agreement is only for five years, something should be done to see that, at the end of the five years, if it is possible at all, that trade should return to Dublin.

Further inquiries have assured me that Jacob's are producing as much biscuits now as before the war and are employing as many people. I cannot reconcile that with the fact that biscuits are practically unobtainable. Biscuits are not rationed. There is an argument for rationing; if they were, we could get our share. Cigarettes are not rationed and we cannot get any. Both biscuits and cigarettes have gone under the counter. If more biscuits are being made and sold in the Twenty-Six Counties than before the war, there are some people here eating beyond the normal capacity, as they are consuming the whole country's ration. Strange things have happened because of the shortages and this one of the transferring of our biscuit trade to Liverpool in order that Liverpool may supply the North of Ireland is not the only freak.

I have here the New York Times of Sunday, November 17th. There is a display advertisement in it: “Will deliver anywhere in Great Britain Scotch whiskey unobtainable in Great Britain”. It is sent by Britain, or Scotland, to the United States and resold by the United States to Britain, where it cannot be bought direct. Senators may laugh, but what is very funny is that we are doing the same thing here. We are importing things from abroad, tinned fruits and other things, and are building up a trade in exporting them again. That trade has become such a racket that the British Government has had to step in and stop it. I think it is a scandal that it was not stopped by ourselves long ago. I do not know why we should buy things from abroad to re-export without any processing work being done in regard to them.

I am one of those inquisitive people who go around making inquiries when I hear of anything, and I am assured that this racket in parcels to England has developed for this reason, that the Government, or some Government Department, was convinced that a post office declaration form on a parcel was sufficient and that there was no use in imposing extra work on the customs people or employing extra staff to open an occasional parcel to see what was in it. As soon as the shrewd businessmen got to know there was no customs check, what was supposed to be tinned pears happened to be nylon stockings. I believe that even gold watches went away as golden peaches. However, the scandal had to be stopped and has been stopped by the British Government. It grew to be such a racket that people in this country printed handbills and appeals and sent them out to everybody whose name and address they could find in a directory. They were offering goods in short supply and offering them at as much as 50 per cent. above the controlled price here. Even controlled articles were being offered and sent out at 50 per cent beyond the price legally chargeable here. I am not talking through my hat. I got one of these circulars in the usual roundabout way in which they come into our hands. I handed it in to the Department of Industry and Commerce and, if it was not the first one they got perhaps it was the first occasion on which their attention was drawn to the matter.

I think that control is necessary. When I hear people say plausibly— and with the utmost belief in the truth of what they are saying—that the sooner we get rid of control the better, I wonder what would happen if there were not some control. I wonder what would have happened in the course of the war years if we had not had control. We would not want our police force, our prisons, and our income-tax inspectors if we could trust each other to that extent. We do not trust each other and I do not trust the others either. We do not trust each other and I do not trust you. I understand that when further inquiries were made about the biscuits—I want to be fair to everybody—the explanation, or partial explanation, that was given on behalf of Jacob's was that the British Government made available to them in Liverpool materials for the manufacture of biscuits which were not available or would not be made available for them here and that the average wage here was in or about 17/- a week more than they were paying in Liverpool. Those things may be true. I am giving them, in any case, as part of the explanation.

We do not mind, when we want to sell to Britain, when we get every facility that we think we are entitled to. I have no grudge against Britain. As long as Britain minds her own business and allows us to mind ours, I am quite satisfied. But, under the Trade Agreement of 1938 and the agreement of 1948, the British Board of Trade has the right, I understand, to tell us what we may or may not export. We may have a surplus of a commodity here. We may be specially qualified to manufacture something and, if anybody in Britain says "Do not let that stuff in", the British Board of Trade blocks the door. I will give an instance of that, in case anybody suspects that it is not true.

A small company recently started here the manufacture of glass signs. Advertising signs are being brought into this country, for tobacco firms, amongst others. They could be made here and they are not made here. The persons engaged in their manufacture, since they could not get work to do in this country, sought orders from England and they got them at a competitive price. When they got the orders, the British Board of Trade, at the request of the British Signmakers' Association, forbade us to export them. Surely we have not reached normal conditions of trading in our own country or with any other countries.

Mr. M. Hayes

Would Senator O'Farrell explain, Sir, is that a prohibition by the British on imports into England?

Mr. S. O'Farrell

Yes.

Mr. M. Hayes

That is not forbidding us to export. That is a different thing.

Mr. S. O'Farrell

It is forbidding us to export them because we can export them no further than our own port. We cannot export them to Britain.

Mr. M. Hayes

If we forbid something to be imported from England, we are not forbidding the British to export. Is it not the same thing for Britain?

Mr. S. O'Farrell

I am not unaware of the meaning of words. The British Board of Trade forbids us to send our goods to England, whether that is forbidding import or export. They do not allow our goods into Britain.

Mr. Colgan

We open our arms and take their goods.

Mr. M. Hayes

Not always and not all.

Mr. S. O'Farrell

Let us come down to something that is not controlled by the British Government. Aer Linte and Aer Lingus are not controlled by the British Government. Mr. Morrissey, in opening an exhibition of Irish goods, said that he was afraid we had not many things worthy of our country to offer to tourists. He was right in that. At Aer Lingus Dublin Airport they have a shop. This is an official figure from themselves: they sell every month 120 different publications. Twenty-three of them are Irish. It is a stall for the sale of imported magazines and they give souvenirs to the tourists coming in—free pencils printed over and the pencils are not made in Ireland. I think we ought to begin with a State company to reform.

The control of imports and exports is important. There is an industry in this country for the manufacture of galvanised hollow-ware. As long as I could read I have been reading the advertisements for that firm. It was one of the first Irish firms to be set up. Recently they found that imported buckets were flooding the market. They appealed for protection. An Order was made by the Department that we are talking about now, either by the Minister or the Parliamentary Secretary, forbidding the importation of galvanised buckets.

Some shrewd businessmen in this country—we cannot ever be clever enough, not even the civil servants, for the businessmen—discovered that by importing buckets in one bundle and the handles in another they could laugh at the Department. So, the buckets and the handles came in separately. An Order was made then that galvanised buckets with or without handles were not to be admitted. They kept coming in for a fortnight. We inquired was there not an Order to be made. We were told that the Order was made a fortnight ago, but it had not yet been issued, as it had not come back from the draftsman's office, or somewhere else. This is probably one of the Orders that Senator Professor George O'Brien was trying to decipher this morning. He could hardly expect to understand in five minutes what it took the draftsman two weeks to fabricate. Eventually, the Order was issued that galvanised buckets with or without handles were not to come into this country. So, they brought them in ungalvanised and they are coming still and they are dipping them here. Yet I am told there is no need for controls and no need to watch the businessmen.

We are supplying Britain with foodstuffs because we have foodstuffs, if not in abundance, in excess of our needs. Businessmen are not satisfied to import what this country requires. They import what the businessmen can make most profit on. There are shops in Grafton Street at present filled with imported British foodstuffs, sauces, pickles and cream of chicken soup. I understood they had no chickens in England. How they get the cream of chicken soup I do not know. It shows that there is an inferiority complex in this country when traders want to sell English goods in preference to Irish, and there is always some poor, gullible Irish person with more money than sense who will buy it because it is British.

Captain Orpen

I would like to ask the Parliamentary Secretary if he could give one or two figures. He told us in his opening statement that the total amount of subsidies under the Supplies and Services Act is between £9,000,000 and £10,000,000. I should like to get the average figure in a form that the man-in-the-street can understand. I want to know if it is true that the subsidy on sugar amounts to 2d. a lb. and the subsidy on tea to so many pence, because many consumers are somewhat fogged by these hidden subsidies. The ordinary housewife does not measure things in millions. Ten million pounds mean nothing to her, but 2d. a lb. on sugar, which, I believe, is roughly the subsidy on sugar, has some meaning. Possibly, when subsidies on foodstuffs reach the staggering proportions that they have reached in Britain, where they are in the neighbourhood of almost £500,000,000, we may find the explanation of one of the queries put forward by Senator O'Farrell, why tea appears to be cheaper in Britain. He is referring, presumably, to the retail price of tea as carrying a subsidy as against the retail price of tea here. It would be useful if we could have from the Parliamentary Secretary the average amount of subsidy payable on a lb. of tea in the past year.

I want to take up the hare raised by Senator Summerfield when he referred to the injection of alcohol from the alcohol factories into our petrol. I should like to know what percentage of that alcohol comes from potatoes and whether the alcohol factories at certain times of the year get a ration of imported molasses. It seems to me that potatoes to-day, as a feed for animals, taking the usual equivalent of four parts of potatoes being equal to one of grain, should be worth as a carbohydrate feed £5 per ton to farmers. Are the alcohol factories paying that price?

Some Senators, and I think some members of the other House, claimed to think that the sole reason for rationing is that a commodity is in short supply, physically, that is, that not enough of it exists. I do not think that is the real meaning of the word. If you are rash enough as a politician to look anything up in a dictionary, you will find that the word "rations" came into use about the year 1700 and that for at least 100 years it applied exclusively to the rations served to the army, and anybody who has been in the army knows that it is not a question of short supply there—the rations are always ample—but a question of equitable distribution. A commodity can be in short supply because the means of transporting it have broken down. That was mainly the reason during the recent war—it was not because these commodities were not available. If it is true that we have to get some of our petrol from dollar sources—I believe the figure was given as 40 per cent.— and if dollars are short, there is a very good reason for rationing. It is not the article itself but the means of purchasing it which is in short supply.

There is a very good reason why even commodities which are not in short supply, such as bread and flour, may, because they are subsidised, have to continue to be rationed. We have to remember that there is always a danger, once an article is subsidised and it being a food which may be used for purposes other than human consumption, of its being used for such purposes. A very good case could be made for continuing the rationing of flour so long as it carries a subsidy as big as it carries to-day. Otherwise, flour might be diverted to animal feeding. Surely nobody can suggest that a country with an average calorie intake of over 3,000 is seriously short of carbohydrates in its diet.

Reviewing this Act, one feels a little diffident about its being used to-day as it is being used, and, if some form of control is necessary in the years to come, one would rather see a new Act brought in specially for the purpose of giving the Minister powers of control, because one feels that this system of Orders—it may be convenient and presumably is the most convenient way of doing it—is undemocratic, and if a more democratic way could be found of dealing with this question of control, it would be preferable. I am not in any way questioning whether control is necessary. I think that in a good many cases it probably is, but one would like some idea of how much money, energy and time is devoted to the operation of these controls and whether we could not possibly eliminate one or two which are now kept on as a sort of security in case something goes wrong, whether we could not take a chance and get rid of a few more.

Mr. McGuire

While I support this Bill because it is limited to a year and because I have confidence in the present Government and the present Ministers in relation to the use of these powers, there are a few points which I should like to take the opportunity of mentioning. In the public mind, there is great confusion about the whole situation with regard to the powers assumed by the Government under emergency legislation and many people still think that an emergency is in existence. I feel that this is an occasion on which the Parliamentary Secretary could clarify the situation.

As we know, this Bill merely continues certain powers which came into existence during the emergency for certain specific purposes. There is a sort of economic emergency still, but, at the same time, many people have referred to the fact that very dangerous powers are being continued by this legislation. These are powers which, if they were allowed to lapse, could not, I understand, be given again under the Constitution. I may be right or wrong in that, but it shows how very far-reaching these powers are. There is a danger that, if these powers are kept on and kept on, the public mind will become so used to them that they will be accepted as part of our ordinary life, which in fact they are not, and that the rights of the individual will be more and more suppressed.

There are controls here over all sorts of things. We have controls over all the commodities we use and consume, and, not only that, but we have powers in relation to the compulsory acquisition of land. If your lands are going to be taken nowadays the board of inquiry to inquire into it is set up by the Minister himself. In these powers we have the rights of search and inquiry. In other words, all these things are a complete violation of the sanctity of individual rights. I am not going to be so reactionary as to suggest that we can go back to the individual rights of the 19th century, but at the same time we must not lose touch with them altogether. We are always told that such and such a thing is necessary because of the emergency or because of something that has happened at the moment, but we all know that it is much easier to establish these things than to dissolve them. There are many things in existence to-day which we take as quite ordinary but which were originally introduced as temporary measures. I think that the Statute Book is full of them. Consequently, as Senator George O'Brien said, if Governments to-day used all the powers they had, I am afraid we would hardly be allowed to breathe.

There is another danger in this, that is, our philosophy of life is threatened. Willy-nilly we are more and more influenced by Socialism, and Socialism is materialistic at basis. Superficially, it gives expression to very high ideals which to the uninitiated are Christian ideals. Communism and Socialism— and I regard Socialism as only the path to Communism—gives lip service to the same high ideals, but fundamentally they are the difference between the State built on individual rights and the State where the individual has no rights because the State is above all. With regard to public opinion, it is rather frightening to find that people are so used to being controlled that they call for more and more controls and for Socialism and do not realise that in tying up somebody else they are surrendering their own individual rights. At the earliest possible moment we should do away with all government by Orders which were initiated in a wartime emergency and are now kept on because of an economic emergency. I am not, of course, attacking this Government or the last on this point. This thing is above politics and we should all get together and see that these powers are quickly done away with, if possible by next year. If certain powers have to be maintained in individual cases, such as matters affected by currency, then, I think, they should be dealt with separately. We have individual freedom here undoubtedly, and undoubtedly also the machinery for its destruction exists.

There are one or two minor points on which I should like to make a few remarks. It is commonly thought that by controlling prices every man can be made safe in his supplies and can get them at the right price without profiteering. We all know the arguments in favour of it, but I should like to point out that price control just levels out and always ignores quality. That is very noticeable in the bacon industry. When the control was taken away there was an immediate outcry in the papers about the awful bacon curers and shopkeepers who availed immediately of the opportunity to raise prices, but they completely ignored the fact that quality was a factor that came into the matter. We all know what appalling bacon we got during the war. I remember a man in the bacon industry saying to me at that time: "There is only one quality of bacon nowadays—the worst". You can still buy the worst and I think it would be cheaper than the controlled price, but the people who want better bacon can get it. By levelling out quality we are losing our handicraft in industries that were a credit to Ireland. I do not want to attack the bacon trade but during the war it was certainly a disgrace to Ireland.

There is very little bacon in England, but if you go into an hotel where you know the head waiter and he gives you a bit it is the kind of bacon we made our name on before the war. Price control is definitely responsible for the deterioration in quality and the lack of appreciation of quality by the public which is very important if you want to keep up standards in industry or business. I only gave bacon as an instance, but the same applies to other commodities. Take my own business. People ask if the price of a suit is 12 guineas why they should be asked to pay 18 or 20 guineas. The answer is that there is difference in craftsmanship between one and the other. It is like a work of art. You can buy a water colour of the Four Courts by a mad artist for half a crown and it would be dear, but you could buy another picture by another artist for 20 guineas which would be very cheap.

Senator S. O'Farrell made what I thought was a very good speech, but at times I thought he went to opposite extremes. At one time he argued on one side and at another time on the other. Perhaps I might draw attention to one thing, the re-exportation of things brought into this country from other countries. There is nothing wrong in that. There seems to be a tendency to think that workers are only those who do manual work or work in a factory. People do not seem to realise with regard to the exportation of articles, be they tinned fruit to nylon stockings, that one of the biggest industries in the country is the distributive industry in which there are hundreds of thousands of workers, all paid very high wages and given a high standard of living. Economically, it is quite a good thing to import goods and re-export them, as our people are getting a profit in between. We could get a very good export trade in that way if we could get English goods and re-export them to the dollar areas. There would be an immediate advantage, as not only would we earn dollars but we would give employment to our own distributive workers. The same applies to visitors. There were a great deal of ignorant letters to the papers about English visitors coming in here and mopping up our supplies, but people in the distributive trades are very glad to see English, American or other visitors buying supplies.

Mr. Hawkins

That was only Party propaganda, of course.

Mr. McGuire

There are lots of Parties. I do not want to keep the House any longer but I would like to reiterate that in trade and industry people who are not closely associated with the workings of parliamentary life or Acts of Parliament would very much appreciate a statement on the question of emergency legislation. They would like to know what the position is and it should be clarified. Other things that happened illustrate how people are unaware of the duration of the emergency period. I was talking to a friend recently who happened to be interested in the polo ground in the Phoenix Park, and he asked me when they were going to get it back. He said they could not get it back until the emergency had ended, and that, as the emergency had not ended, the polo ground had not been given back.

Mr. Crosbie

Senator Summerfield and some other Senators, in the course of the discussion, have mentioned petrol among many other things. I should very much like if the Parliamentary Secretary, when he is summing up, will give the House some information as to why, in this country, there are two distinct prices to the public for petrol. I understand that that is a position that did exist pre-war, and that at one period during the war it was dropped, but it was dropped probably at a period when the public were not allowed to purchase petrol anyhow, but there are at the moment two prices charged to the public. One is described as the price chargeable in the Dublin area and another is described as the price for the rest of the country. I very much fail to see the justification for that difference. Presumably the answer of the petrol importing companies would be that there was added cost in distributing it in a territorially small country such as ours, but I fail to see where they can justify that extra charge.

It is not as if there was only one port in this country, the port of Dublin. Petrol, presumably, is imported into the port of Dublin, but it is also imported into the port of Cork. I understand, although I speak subject to correction, that the petrol companies take in petrol by sea in tankers which discharge at Limerick or Shannon. But, as I say, there are other ports. Surely, if the petrol companies sell petrol within a certain radius of the port of Dublin at one price, they could also be forced by the Government to sell petrol at the same price within a certain radius of the other important ports of this country, like Cork.

I would also like if the Parliamentary Secretary could inform the House as to whether or not the Government have any information as to the sources from which the importing petrol companies draw their petrol. I understand that that is information that these companies are very slow or unwilling to disclose and, as Senator Summerfield quite rightly pointed out, there are quite a number of non-dollar petrol-producing places in the world, very many of them in the sterling area. It may be that some of these petrol sources in the sterling area are owned by American companies, but, even if that is so, by what right do they insist on being paid for their products in dollars?

While on this subject I would again like to ask the Parliamentary Secretary, who is the representative of the Minister for Industry and Commerce, who controls Irish shipping, whether something cannot be done to ease our supply position? Our Irish shipping company is within the control of the Minister for Industry and Commerce, and I have, once before, advocated that Irish shipping ought to be forced by the Government to build tankers. I think we are running a very grave risk of endangering our fuel supplies by not providing ourselves with tankers, and certainly if the world situation remains as it is at present we shall, one day, have the question of the provision of a small fleet of tankers, ocean-going tankers, forced upon us, unless Irish Shipping, Limited, are ordered to provide them. I feel that this is a matter which ought to be given careful consideration in any programme which Irish Shipping, Limited, may have in view.

In recent years there has been a practice of Ministers—I am not speaking of one Government, but of the previous Government as well as the present one—to appeal for industrial expansion. I think that on the whole, industry is expanding and expanding satisfactorily. Ministers have also been at pains to point out to the industrial world in this country the need for exports of industrial products. I think that everyone of us will agree that if we are ultimately to put Irish industry on a really sound basis, we must, as far as possible, find as many export markets as we possibly can. Most industrialists realise that themselves, and many ask what are we doing to find these markets, but I think, from what I have heard from time to time, that industrialists, rather than being helped and assisted are sometimes impeded— I do not think wittingly or designedly —but, nevertheless, they are being impeded, by "red tape" in their search for export markets.

I refer, in particular, to the activities of one of the sections set up by the Department of Industry and Commerce, to wit the Prices Commission. The Prices Commission was, quite properly, set up in order to control prices and profits in this country during the emergency. Personally, I think they were exceeding their brief when they started interfering with profits. In my opinion, the primary task of the Prices Commission should have been to ensure that goods manufactured and sold in this country were sold to the consumer at a reasonable and fair price. Outside of that, I do not think they had any other useful function. They have, however, taken it upon themselves to interfere in all kinds of matters, and I think that when you find the Prices Commission interfering with an industry which has succeeded in finding a market, a foreign market, for its manufactured goods, that is certainly reducing the thing to an absurdity. A fair principle to adopt in industry or in industrial production would, I think, be to sell cheaply at home and to sell as dearly as you can abroad. If you can get a better price for the articles you manufacture abroad; well, I say to industrialists: "If you can do that, good luck to you, more power to you." I should like to draw the Parliamentary Secretary's attention to that aspect of our industrial programme, and to suggest to him that the sooner the incubus of departmental interference is lifted off the back of Irish industry, the more likely Irish industry is to be successful.

Mr. Hawkins

Would the Senator give us his views on the industrial advisory committee that is being set up?

Mr. D. Burke

I have only a few small matters to refer to. Senator Séamus O'Farrell mentioned that there were certain articles manufactured in this country that were not allowed to be exported. I should like to request that the Department of Industry and Commerce should seek to put the same embargo on the imports of corresponding articles into this country. I know of one particular item of machinery that is manufactured here, and having a special knowledge in that respect, I know that it is as good or better than any article if its type manufactured in-Britain, but the British Board of Trade refuses to allow any of the articles made here to be exported into Britain. I know of British firms trading in this country that are using machinery that is being manufactured by Irish craftsmen in this country. That is a tribute to the quality of this machinery, but the British Board of Trade say it will not be allowed to be exported, while inferior British machinery is allowed to come in here ad lib.

Recently, there was brought to my attention the case of a factory manufacturing spectacle frames in Waterford. That factory had the utmost difficulty in procuring a licence to export a very small quantity—£5,000 worth—of spectacle frames out of this country, while British manufactured frames could be imported here and in any quantity they liked. I think that is a matter of policy, as between our Department of Industry and Commerce and the British Board of Trade, to see if there could be some reciprocal arrangement between the two where, by a kind of interchange of goods of that type, they might be able to remove control altogether from this type of article and, to that extent, benefit this country. It is a great achievement if we are able to do some of these things better than the people on the far side of the water. It gives people engaged in industry a confidence that will help them in the export market.

Mr. Séamus O'Farrell

The same thing applies in the case of publications. We cannot sell our publications in Britain, but they can sell their publications here.

Mr. D. Burke

Recently, it was brought to my attention that people assembling goods in this country do not keep spares for the maintenance of the machinery assembled. I think the Department ought to insist that anyone who sells a machine for any purpose ought to keep spares. Only in one or two instances has it been brought to my notice that spares were not available for motor cars. I think there ought to be definite instructions, that that should be particularly insisted upon, in view of the danger to life caused by the fact of not having mechanically-propelled vehicles in the full and most effective mechanical efficiency.

There has been a reference made by Senator McGuire to the decontrol of bacon and the effect it has on quality. It is very true that when a price control is removed there will always be some people who will set their ideal of quality and look for that side of the market. It has been in evidence, and it has been one of the reasons why there has been a variation in the price of pigs. It is a subject I know quite a lot about, but I am not going to weary the Seanad this evening by bringing in all the various ramifications of a very complex business. I do agree with Senator McGuire that the removal of price control does give us variety and encourages the production of good quality and craftsmanship. I would ask the Parliamentary Secretary to take a note of the few points that I have made to see if he can in some way remedy them.

Parliamentary Secretary to the Minister for Industry and Commerce (Mr. Cosgrave)

Sir, this was a rather wide debate. It ranged over a number of major matters, as well as a great number of smaller ones. Consequently, I do not think Senators will expect me to reply in detail to every point that was raised, but I will endeavour to deal with the principal controls or the effects of control which are disturbing the minds of Senators and, possibly, the mind of the public as well.

As I said, when introducing this measure, the Government is most anxious to dispense with control, whenever and wherever it is possible to do so. The list of Orders which have been revoked or amended is, in itself, an indication of the approach which the Government has to that problem. There are some controls which, even listening to Senators here, it must be obvious to anyone, must still be retained. However irksome the operation of these controls may be at certain times, I think the general experience is that there has been, over the past 12 months since this Act was continued, a substantial easement in the operation of a great number of controls, as well as in the effects of these controls and also in the supply of a number of commodities. A number of Senators raised the question of rationing. Some of them mentioned the fact that they did not see why it was necessary to continue to ration goods, merely because they were subsidised, and that instead of rationing, we should allow free play of demand to operate, and that on any increase in the use of particular commodities the cost should be made good by increased subsidy. The three principal commodities affected are all essential foodstuffs; bread and flour, tea and sugar.

Senators may not be aware of a very exhaustive inquiry that was conducted by a committee under the chairmanship of the Attorney-General, Senator Lavery. Certain recommendations of that committee have already been implemented, and it is hoped in the course of time, to implement all the recommendations which that committee, after a most exhaustive and careful study of the position, recommended. As a result of some of these recommendations, it has been found possible to reduce the demand on the subsidy, and when Senators ask why is it not possible to decontrol bread and flour completely, and would it not be more economic to decontrol bread and flour and, consequently, to reduce the staff working on the problem, I think a simple illustration of what the increase demands, or an increase in the use of bread and flour may mean, will suffice. At the moment, the staff employed is small. The total cost for the staff employed on tea and sugar, and also on bread and flour, is very insignificant when placed in comparison with the amount of subsidy which even an increase of 5 per cent. in the bread and flour used can have. A 5 per cent. increase in the sackage of flour means an additional subsidy of £360,000 per annum.

Senators will remember that, last year, when there was a bread strike in Dublin and flour and bread were decontrolled, the increased consumption as a result of decontrol amounted to 3,000 sacks per week, which is almost 6 per cent., so that if that continued for 12 months over £360,000 added subsidy would be required. The total use of flour prior to rationing amounted to approximately 65,000 sacks a week. As a result of rationing, it has been possible to bring it down to 56,000; and even below it, by the elimination of the use of flour for non-essential purposes. One example is that subsidised flour was previously made available for the manufacture of paste. I do not see why the public should be called upon to pay a tax in order to make flour available at the subsidised price to manufacturers of paste, which is used in the ordinary paper trade. There are some other examples of that kind. Similarly, the use of subsidised flour is no longer made available for biscuit manufacture. The heavy weight of subsidy provides an unanswerable case for the utmost economy in the use of subsidised flour and it is because of that that the two-price system was introduced.

Most Senators agree that the present ration of bread and flour is adequate for the requirements of normal persons. It is true that persons engaged in hard manual work and persons engaged in harvest work in the autumn require an increase in the allowances, but adequate facilities are available to enable such people to draw increased rations. Consequently, no particular hardship is placed on them. At the same time, over and above the ration of bread and flour, there is available to everyone if they wish to purchase it, bread at the higher prices and at different extractions.

Some Senators asked questions about tea and sugar. The same situation arises regarding both of these commodities, except that it is not as costly. I think it was Senator Orpen who asked for details. The present subsidy on flour is approximately £3 17s. 0d. per sack. The subsidy on tea is, I think, approximately 2/2 and on sugar it is a little over 2d. a lb. The total tea subsidy is over £2,000,000. When the ration was brought up in May, 1948, from 1½ to 2 ozs. per head, the increase in subsidy amounted to £400,000, and that is a continuing liability. The sugar subsidy totals about £1,017,000 a year. Earlier this year the same system was introduced for tea and sugar as operates in the case of bread and flour. Over and above the ration, sugar is available at the economic price and tea at 5/6 a lb.

Senator O'Farrell wanted to know whether our tea is purchased through British buyers or the British Ministry of Food. Our tea is purchased entirely independently by Tea Importers. It is true that at the moment the tea landed here costs something more than tea landed in Britain. That matter is under investigation. Certain reasons have been assigned for it. One reason may be that the bulk purchases on the part of the British Ministry of Food make it possible for them to get tea at more reasonable prices. Whatever the reason, there is a slight increase in the landed cost of tea here. It is not possible to get tea freely at cheap prices. In fact, the general indication is that tea tends to harden in price rather than go the other way. Therefore, any suggestion that if tea were decontrolled and different varieties made available, it would result in a lower price being charged here to the consumers, is not borne out by the facts. The higher cost of tea here may also be due to the fact that the quality of tea used here is better than that used elsewhere—certainly in some countries. The conditions which formerly operated, whereby a variety of teas at a variety of prices was readily available, no longer exist and it is only by means of subsidy that it is possible to keep tea at 2/8 a lb. Similarly in the case of sugar—except that we produce a large proportion of our own requirements from home-grown beet. In addition to the home production, we must import in order to meet our needs.

The other commodity that excited the interest of Senators is one which is rationed but on which no subsidy is payable. That is petrol. We imported last year more petrol than in any year pre-war. While it is still rationed, no one can complain of the effect which rationing has—certainly no one who requires petrol for business or other necessary purposes. In view of the uncertainty concerning the hard currency areas and as there is in petrol a certain dollar content—approximately 40 per cent. of the petrol purchased is from the hard currency area and about 60 per cent. from the sterling area—it would not be prudent, while I am not anticipating any drop in the supply of petrol this year, to dispense entirely with rationing, keeping in view also the recent devaluation of the pound. It is much easier to keep a system in operation than to restart it, and the present system now being operated does not involve any great inconvenience on users. A new ration book, which will come into operation on the 1st of January, will be a further simplification.

Senator Bigger, I think, and Senator Summerfield referred to the use of industrial alcohol in petrol. It is true that there is a proportion of industrial alcohol used in petrol and it affects the price by approximately 1¼d. to 1½d. per gallon.

Some Senators wanted to know if industrial alcohol was made from potatoes. The real idea when these alcohol factories were started was to utilise surplus potatoes of inferior quality, but experience has shown that it is seldom there is a surplus of potatoes and, when there is, it is put to more profitable use by the growers than sending it to industrial alcohol factories. A strange result is that molasses, all bought from dollar sources, are being used for this alcohol.

Mr. Summerfield

Shame.

Seanad Éireann debate - Thursday, 15 Dec 1949

Supplies and Services (Temporary Provisions) Act, 1946 (Continuance) Bill, 1949—Second Stage (Resumed) and Subsequent Stages.

Captain Orpen

An Leas-Chathaoirleach

An Leas-Chathaoirleach

Seanad Éireann debate -
Thursday, 15 Dec 1949