Central Fund Bill, 1950 (Certified Money Bill)—Second Stage (resumed), and Final Stages.

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

In view of the announcement that the Minister is to conclude the debate at 5 o'clock, I propose to be brief. I was replying last night to statements made by Senator Baxter which were very annoying to me, statements which, in substance, meant that Fianna Fáil supporters were trying to sabotage the land rehabilitation project. I advanced as one reason for that misrepresentation the hope of depriving Fíanna Fáil supporters in the country of the benefit of the scheme. A second reason for that misrepresentation would be the providing of an alibi in advance for any possible failure of the scheme. Personally I hope the scheme will be a success. The only criticism I have to make of it is that it is not being applied quickly enough and the amount of money being spent is not what I would regard as sufficient. I hope that, when the scheme gets into its stride, there will be greater advances in that direction. That should dispose of this misrepresentation which is being deliberately carried on in the hope of making people believe that there is something in it.

Because I feel it would be so damaging to the country, I suggested last night, and repeat now, that one way of counteracting that type of misrepresentation would be for every member of Fianna Fáil and all supporters of Fianna Fáil, if they have any land at all, to apply immediately for benefit under the scheme. That would prove beyond yea or nay that it was without any foundation whatever. The very fact that there is this misrepresentation is an admission of the mighty influence of Fianna Fáil. I do not desire to discuss matters on these lines, but I feel I must do so because of the approach of Senator Baxter and his reference to the farm improvement scheme as a piddling little scheme the product of small minds. I felt very sore about it last night, but I have possibly cooled off a little to-day.

A great blessing.

I hope there will be no repetition, Senator.

I hope that this little explanation will prevent the making of that type of speech in future and that we will have——

The Senator has dealt with the matter. Perhaps he would now come to the Central Fund Bill.

So great latitude was taken by many Senators to discuss a variety of matters that I thought I had the right to reply on points about which I felt hurt.

The Senator may not follow bad example. He does not usually do so.

You think I am impressionable, Sir. Senator Baxter made a statement last night with regard to the butter subsidy. To be fair to the Senator, he did not commit himself as to whether he was in favour of paying a subsidy on our exportable surplus or not, but he did refer to what was done in the past. Bounties were paid on food exports in the past and Senator Baxter gave the amount as about £15,000,000 and said he would give the years if requested. I suggest that subsidies were not paid on our exportable surplus from 1939 on.

There was no exportable surplus from then on.

During the years when there was, our export trade was as it was because of the depressed world price for agricultural produce. On top of that, this country was engaged in an economic conflict with Britain. I am well aware also of the approach of Senator Baxter when this country was fighting to establish a Republic. Since the Senator did not commit himself with regard to the payment of subsidy now, there is no reason why I should do so. I hope that effectively deals with the question of subsidisation of any commodity.

Very effectively—it is as clear as mud.

I intend to deal with the matter of rates and I feel that it is a pity that things are said which rile people, with the result that we have to have the type of debate we have had. That was not the position in the past and I hope it will not be the position in future. I want to draw the attention of the Minister to the matter of rates in the Western counties. The position there is becoming intolerable. Many local authorities in the West, with a contracted taxable capacity because of very low poor law valuations, find themselves in a position in which they are unable to raise money to give even reasonable services. Local authorities are charged with the responsibility of providing services—housing, health, roads and so on—and, if within their taxable capacity, they are unable to raise enough money to give reasonable services or services similar to those given in other countries, is it any wonder that congested districts have a grievance in the matter? It is a fact that in Donegal, Leitrim, Galway, Mayo and Kerry the rate in the pound is much higher than it is in most of the other counties and it is also a fact that the services in these counties are not up to the standard of those in other counties.

With regard to road grants, it was very undesirable to have a general flat rate reduction in these grants. So much has been said about it already that I do not want to go too deeply into it, because I do not want Senator Baxter or anybody else to say that I am dealing with it merely because it is a political issue. A road survey should be made and grants paid from the Road Fund according to the necessity in each county and not according to the amount the local authority is prepared to raise buy local rate. In County Leitrim, the county council cannot raise enough money to keep the roads up to a reasonable standard. Every time I get a chance I have to refer to this, and intend to keep on doing so, as it is a burning question in County Leitrim and in Donegal, Kerry, Mayo and Galway.

How does it come in under the Central Fund Bill?

Since public money is being disbursed, I thought any phase of administration could be mentioned briefly.

The Road Fund does come in, but the raising of local rates is another matter.

The rates difficulty is due to the reduction in the road grants. A county with a high valuation, where people are richer, can get more out of the Road Fund. That is to the detriment of counties with low taxable capacity and hence out of local taxation they cannot bring the roads up to a reasonable standard. This is not a political issue and I appeal to the Minister to look into it. He will find that that is the outlook of all political Parties in the counties I have mentioned.

Senator Finan made a statement yesterday evening about the low wages of the agricultural labourer. He said it was due to profits in agriculture being lower than in any other industry. He said they had improved during the past couple of years, but did not make the case that, because of that improvement, the agricultural wage should be increased correspondingly. That would be a logical case to make.

Has it not gone up 10/- a week in the last couple of years?

He said "at the present time"? As there is a desire that the Minister should conclude at 5 o'clock, I will not delay the House any longer.

During the course of his remarks yesterday, the Minister referred to the risks the Government was taking in issuing a huge amount of money for capital expenditure in the past couple of years, but he reassured us that they were keeping a watchful eye on expenditure and that so far there were no untoward results. I wish to endorse what Senator Finan said yesterday. The cost of building houses under local authorities given out in contract compares very unfavourably with the cost of similar houses built by direct labour. It is not a matter of the wage as the direct wages are at least as high as those paid through the contractor, yet the aggregate costs of the structures, those by the contractor and those by direct labour, differ very much.

Another matter bearing on the same issue is the large allocations of money made available to local authorities for the provision of waterworks and sewerage schemes. I have no objection to the extension of these schemes to every area. They are desirable and necessary. But I have a strong objection to the indecision and uncertainty that seems to characterise the work of the officials responsible for formulating these schemes and carrying them into effect. There is a tendency in the official mind to formulate streamlined schemes which are very pretentious, very expensive and when carried into effect do not render the same services as less pretentious and less expensive ones.

I have one particular case in mind of a small town serviced by a water supply installed by local effort 35 years ago. The supply needed supplementing and instead of going to the source of the original supply, where according to opinions of people living in the district the supply could be supplemented, the consulting engineer went off to another part of the country and now on presenting a scheme after 10 or 12 years examining locations or studying various suggestions each one costing an outlay of money which someone has to pay, the scheme evolved is dependent on having water taken from a disused mill dam that can function only through the aid of electric power. What could happen during a temporary stoppage of that power as occurred during the 1947 blizzard is better imagined than described.

There is another matter that will need the supervision of the Government from the top, that is, the delay that occurs on the part of some local authorities in carrying into effect certain works on road improvement on which the success of land drainage adjoining those roads depends. I have one particular case in mind where since the initiation of the land project a certain farmer has tried to avail of the benefits offered and has been held up owing to the fact that a waterway which crosses a certain public road is blocked and the council has apparently not time to attend to it. Work of that kind should have priority over any road work, certainly over the huge road works which are not to the advantage of the people who pay for their upkeep but which are designed to facilitate motor speeding thus driving the people of the district off those roads.

I would like to support in the strongest possible manner the appeal made by Senators Hayes and Stanford yesterday evening for consideration of the universities. I feel that the Government is keen on the desirability of keeping up the standard of our universities in line with those of the adjoining countries. However, I would not like to pass from that without saying how much I appreciate the efforts of the Government to meet the claims of the teachers, primary teachers and pensioners to which I had occasion to draw the attention of the Seanad on other occasions.

I assure the Minister that the distance the Government has gone in meeting the just claims of that profession is very much appreciated notwithstanding the fact that it has not been received in certain quarters as enthusiastically as it would have been received if these claims had been met in a similar manner three or four years ago.

I would like also to express my approval of the contribution the Government is making towards reconstruction, renovation and erection of primary schools. National schools have been frequently referred to, and appropriately so, as the poor man's university since they cater for 90 per cent of the children of this country. The providing of that large percentage of the rising generation with proper schoolrooms, playing grounds and with a contented teaching profession will eventually pay dividends that will more than compensate the Government for the outlay involved.

I should like to refer to the worry that is occasioned in certain small towns in the West of Ireland where revaluation of certain business premises has taken place recently. I know that the raising of the valuation always occasions a certain amount of anxiety on the part of the owners affected. In the rural areas the provision of a hay barn or the reconstruction of a dwelling-house or the building of an ordinary piggery is followed by an increase in valuation and a consequent increase in rates. This presses even more heavily on some of the small towns. I know one case where the valuation of licensed premises during the past few months has been increased from £8 to £26. That increase is only one of many I am informed about and inflicts wounds of a threefold nature in more places than one, for it means an increase in the annual rating, an increase in the lighting charges, an increase in the licensing fee these traders have to pay. I would like to point out to the Minister that the small towns in the West of Irland are passing through a pretty hard time at present. Business is not as brisk as it used to be. The old order is changing and if this matter is not handled in a judicious, expeditious and fair-minded way many people will certainly be driven out of business.

I will close my remarks by saying how thoroughly I approve of the form in which the Estimates are presented this year. I am speaking not alone for myself but for many people who drew my attention to the matter before I adverted to it at all. It is only fair and proper that the responsibility for repaying the financial burdens placed on the shoulders of the people because of the huge capital expenditure entered into by the Government should be borne in part by those whom the works benefit and for whom they are intended.

When the new Government was formed I was one of those who thought it a matter for congratulation that the Ministry of Finance would be placed under the care of a hardheaded Northerner, a countyman of my own. I felt that, if anything could be done to cut down unnecessary expenditure, he was the man to do it. This year we are presented with a huge bill for over £78,000,000. It is the more disconcerting when a Minister who, I am quite convinced, would do his best to bring down expenditure to the lowest possible level for safety has to make himself responsible for it. I do not blame the Minister. If you look over the table for audited expenditure over the ten years 1941 to 1951 you will find that each year there is an inevitable increase, an inescapable increase of £3,000,000, £4,000,000 and £5,000,000. It almost looks as if it was the law of nature, like the rising tide, that the moon brings in the tide and there is nothing stopping it. I am glad I thought of that simile because I hope the Minister will remember that there is a receding tide and perhaps, next year, instead of being presented with a bill for another increase of £3,000,000 the bill will be reduced.

At the same time we must remember, in connection with the sums for public expenditure, that the decreased value of the pound must be taken into consideration. At first it would seem as if it jumped from £35,500,000 in 1940-41 to £78,000,000 in 1950-51, but we must not leave out of account the lessened value of the pound.

I think the worst part, perhaps, of our getting used to huge figures of expenditure is that we will become million-minded. That is a very bad thing for a poor country. I want to voice my concern about two huge buildings that are to be built in Galway. One is the sanatorium, to cost, as the Minister for Health rather proudly told us, £1,000,000, and the Central Hospital, costing £1,000,000. This is money that comes out of sweep funds and perhaps people may think that we can be generous with it, but I do not think that at all. We will have to keep up these huge places. I hope that the time will come when the problem of tuberculosis will have been so grappled with that we will not have need for such a huge sanatorium. One of the ways by which this improvement in public health could be brought about is one that will have priority in the schemes which the Minister has in mind, housing.

We hear people speaking of housing as if the sums provided for housing were a dead-weight debt. I think housing is a most productive form of national expenditure. Housing means people. If we examine our very low marriage-rate, which is largely responsible for one of the worst evils that we have, namely, the lessening of the population, one of the reasons is that people cannot afford to get married if they have not jobs or houses. That is what keeps the ordinary young man and woman, who are anxious to fulfil their natural destiny, from getting married. They cannot get married because the man has not a job and there is no house. Therefore, housing is an economic necessity. The most precious thing we have is our population, and the quality of our population depends on houses and homes and on the women who make or mar them.

For that reason I am glad also that high in the list of the Minister's priorities for capital expenditure are schools. It is a disgrace that we should have some of the schools that teachers have had to put up with over such long years. It is not only a disgrace but it is something that our conscience should be concerned with. We have what is called a School Attendance Act and we make it a crime or legal offence for children not to go to schools which in some cases have been condemned. The sooner we can get after these schools the better. I am very glad that the Minister has stressed the priority that he will give to the building of schools.

In all these schools, I hope, provision will be made for the teaching of girls in housecraft. The three R's are all very well but a woman is a home maker and most of the women, owing to circumstances for which perhaps our history is to blame, cannot have got the training in home making that we know is necessary. It is essential in a modern system of education to have kitchens and other equipment in girls' schools so that they can be taught housecrafts, cooking, sewing and house management. It is absolutely necessary. Nothing will pay in public health more than if the future mothers are trained in running their homes and in simple hygiene. We have to get away from the old idea that all that are necessary are reading, writing and arithmetic. We must realise that there is a great deal more to be learned at school than these subjects. It has been found in the case of girls who were backward in book knowledge, that when they went to a certain school where they were trained in housecraft, their intellectual abilities emerged. Their natural instincts were being trained and they learnt with much more diligence and intelligence. For that reason it would be good expenditure, both from the point of view of intellectual as well as technical education, if provision were made in these schools for the training of girls in housecraft.

I would like to join with my colleagues in the universities in pleading for more generous treatment for universities. The most precious thing we have is an educated people, as was said by Senator Hayes, Senator George O'Brien and Senator Stanford. The advantages flow down all through the country. The Minister himself, who is a university man of high distinction and a classicist, was, I am sure, as proud as I was to listen to the speeches that were made last night and I am sure he would feel that money could not be better spent than in producing men of the type that we listened to last night and who made such a splendid case for university education. I think the university people in this Assembly have enhanced its prestige.

There is a small point to which I would like to draw the Minister's attention. The burden of drawing up the voters' register in the universities is placed on the universities. I do not think that should be so. The universities' meagre funds should not be depleted to that extent. I expect them to do the work but it is an expensive matter, that is growing every year, and I would like the Minister to take into consideration the possibility of removing from the shoulders of the universities the preparation of the voters' register. I think the Minister will agree that the State is getting good value for the money spent on university representation. The men who spoke last night would do credit to any European assembly. For myself, I do not claim to be in that class but I think I bring to the proceedings a sort of homespun commonsense now and again, from my knowledge and experience, that is not without its uses. With those speeches ringing in his ear, I hope the Minister will be generous with the universities and that, in particular he will take from the universities the responsibility for the cost of the tabulating of the voters' list. That is a very small thing to ask him and I am sure he will hardly turn a deaf ear.

I see there is a grant for harbour development. I hope the Minister will not forget Galway harbour. There was a magnificent case made. Galway harbour is in a sort of half-baked condition. The chairman of the country council will tell us about how things are. It is quite impossible, as it is now, to make full use of the money already spent on it. If enough money were provided to complete the scheme —the scheme was in two parts—it would be of incalculable advantage, not to Galway alone but to the whole West. The people who come from America tell us how we are to help to repay Marshall Aid. They stress the tourist traffic. Nothing could be better in the matter of increasing tourist traffic than to use Galway as a first-class port. It is not a matter of many thousands to achieve. Galway is a magnificent tourist centre. There are good hotels and it has a beautiful hinterland. There is Lough Corrib with all its historic islands. We have a wonderful opportunity now and I hope the Minister, when he is disposing of the sum for capital development, will pay great attention to the claims of Calway harbour.

As there is a general understanding that the Minister should get in about 5 o'clock, it is quite obvious that no Senator can expect to get more than ten minutes. If I should exceed, will you please call me to order? I shall not be offended.

I would like to join with those Senators who have congratulated Senator O'Brien on what I think was the best speech I have ever heard him make, and that is saying a good deal. It is one that I would advise members of the House to read and study, whether they agree with it or not. It seems to me to be a very valuable application of what we might call economic theory in a practical manner. It was neither radical nor ultra-conservative and it was very much the kind of approach which I think highly desirable in a country like ours.

The debate on this Bill has very much followed precedent. In almost every debate on the Central Fund or Appropriation Bill which I can remember, most Senators deplored the total size of the Estimate and then asked for it to be added to in some way or another. That would be quite in order and usual, but I do not propose to follow. In the matter of finance it is obvious that the general plan must be outlined by the Government of the day. It is not possible to settle small points on individual lines no matter how importent they are and it seems to me that general discussion and criticism, if it is to be of any value, must be constructive. There is no subject on which it is easier to make Party points and personal points than finance, and I do not think that there is a single man or woman in public life to-day who is worth tuppence who has not at some point said something which he wished he had not said, and these points do not cut any ice so far as the public is concerned. I cannot conceive of any position which I would less like to hold in this country than that of Minister for Finance. Not only is it a very responsible position but it is a thankless one and what must be more irksome than anything else is that the Minister cannot, like other Ministers, take a personal point of view. He must balance the whole position, listen to the arguments of the different sections and Departments and then put forward the programme. I may be wrong but I do not think I am when I say that the present Minister has the very general confidence of the public. They believe that although he is a strong character and has strong convictions he will endeavour to strike a fair balance and particularly will avoid expenditure of what might be called an unnecessary type. Everybody agrees that there is very wide scope for development both in agriculture and industry and we all agree that that of necessity involves capital expenditure whether by the State or by individuals.

It is obvious, I think, that the capital expenditure cannot, as far as the State is concerned, be met out of current taxation yields without imposing taxation at a rate which the country could not afford or at a rate which would of its very essence retard the development we are endeavouring to achieve. The division of the estimates into capital and other expenditure has met, I think with general approval and I have heard no criticism of it. The question which really arises and on which there is room for difference of opinion not only now but in the future is what can properly be regarded as capital expenditure. Senator O'Brien compared it in a somewhat playful way with personal expenditure in a house. My mind immediately applied it to the position of a business which is considering whether it will or will not borrow for capital expenditure. The first vital question is will it provide enough profit to pay interest and provide for repayment. In the case of the State the real test for capital expenditure is: will it within reasonably foreseeable time add to the general prosperity of the country and the taxable capacity of the people? If it does it is fully justified. I am not at all worried about the size of the Estimates. It is not the size which worries me but how far they will lead to taxation which the people can be reasonably asked to pay. It would not worry me in the slightest if the Estimates were twice the size, despite Senator Mrs. Concannon's worries about our being "million-minded", if the Minister said he could meet them without adding to taxation. It is very difficult to meet the Central Fund Bill without knowing what the Budget is but I know that we always have to do it. The real test is that any capital expenditure which will enable a future Minister to get an additional yield without increasing the present rate of taxation will be fully justified. If it does not do so, it is doubtful.

I do not want to follow the various points raised in this debate. There is not time nor do I think it would serve any useful purpose although it is extremely tempting. Senator Colgan said—and I am sure perfectly rightly— that the workers in the building trade longed for security. Of course they do. That is what ordinary people all over the world, particularly in Europe, long for but in the present world with atom bombs and hydrogen bombs and the spread of Communism I am afraid that it is one of the things which none of us is going to get in our lifetime. I am inclined to think, however, that the building workers in this country have as much security as any other workers because of necessity we will have to go on with building for longer than the five years suggested. If the manufactures could feel secure that trade would continue, if they could make 10,000 articles and sell them and know that they would sell a similar amount next year, they could reduce prices and even pay higher wages. There is always an element of uncertainty. If the Minister for Finance knew for certain how much he would have next year and the year after he would not have any doubts about how much he could spend. We are living in an uncertain world and we must take risks and must decide what risks to take, but unless there is another war and if the various classes decide to pull together I think that we have reasonable prospects in Ireland. It is not merely a question of Estimates which have to be met but is a question of how the taxation is to be arrived at. One of my greatest disappointments has been that I have never been able to find a Minister for Finance who realises that the people generally are not satisfied that the method of taxation, particularly the application of the income-tax laws, are fully equitable between one person and another.

I have time and time again urged that a committee be set up to see if more equitable methods could be found without reducing the total yield. I still think it important. I have raised it in detail on at least two occasions in this House and I do not intend to do so again now. But no matter which I ever raised here, judging from the number of letters I received, had more support from outside. We are at the present time, subject to minor amendments, in the working with income-tax laws devised by the British Government about 30 years ago, and they are not fully equitable to-day.

I propose to conclude by referring to a matter which was raised in a slightly different form by Senator Ruane. I think it is time that some Minister for Finance who is theoretically responsible for the Commissioners of Valuation should revise the laws under which they operate. Unless I am very much misinformed, they hold powers which are only known in totalitarian States. The people believe that they can go into anybody's house without rhyme or reason and, without giving any reason whatsoever, revalue. They do not often do so, but people cannot for the life of them understand why their house is revalued while others are not. The Minister for Finance, in considering capital expenditure, has an advantage over the individual. He will not find that he has to pay additional rates and electricity fees, because he will not be revalued because he has made improvements.

Not the least important of the facts brought to our notice yesterday were those in relation to the universities. We were told by the representatives of the universities in this House that these institutions are not able to give the most efficient service because of their financial limitations. We were told that their classrooms are inadequate, that there is a lack of modern equipment and that the salary scales of the staffs are very small. I think that these are things which deserve immediate and specific attention.

We were told by Senator Stanford that people holding high office in his university had salaries of less than £7 a week. We were told by Senator Hayes that a 50 per cent. increased grant was given in 1947 to the staffs of the universities. I do not know why people of the grade of professors should be confined to an increase of 50 per cent. while people in other grades have got far greater increases. I think it is because the laity seem to take it for granted that the teaching profession have for hundreds of years been accustomed to sacrifices. I know that when I was very young the ordinary teachers were on the very lowest scale. If we are to have the best teachers in our universities we must be prepared to give them an ample compensation for their labours. After all, if a man is a highly skilled specialist there is a market for his ability in other countries and if we are to keep at home the people we need to give our students a first-class education we must be prepared to pay them. I have never known a professor who died after amassing great wealth and in practically no other calling or profession would that be the case. I would recommend to the Minister that he should give serious consideration to increasing the salary scales of the staffs of the universities in order that these highly educated specialists should have a reasonable standard of life.

I realise the importance of adequate classrooms and if it would take a considerable length of time to provide the universities with them it should be possible to provide alternative rooms in the meantime and that should have immediate attention also. The same applies to the question of modern equipment. After all, if we are to keep in line with the times we must give our students the most modern equipment available. To my mind it would be quite a reasonable thing to have a fixed figure in the Estimate every year out of which the universities could draw cash to purchase any equipment required without forfeiting some other necessity.

As a layman I would like to join in the appeal which the representatives of the universities made to the Minister that the Government should be as generous as they can with our universities because whatever happens, those who are trained in the universities are always of benefit to the country. If our people must emigrate there is only one section of them whom we can see going without being too sorry, that is, those who have had the advantage of university training, because in other countries they should be able to fend for themselves. They are sure of that, and they will bring credit to our country wherever they go. From this question, I come down to Senator Baxter. I would like if it were not for the time limit, which is agreed upon, to deal piecemeal with the speech which Senator Baxter made. Nothing would give me greater pleasure than answering this question about what Fianna Fáil was doing for the past 15 years. It would take me a long time, I realise, to deal with it, but I would be quite happy to talk about it, because I believe that quite an amount of work was done during these years which Fianna Fáil need not be afraid to talk about. However, another occasion will arise, and it will be possible to deal with the matter more fully. I would also have liked to say a little on vocational education, and to make certain recommendations to the Minister with regard to it, but I will defer that also to another time, so as to allow others to speak during the rest of the debate.

By way of preface, I want to add something to what Senator Douglas said a moment ago about the speech made yesterday by Senator Professor O'Brien. I want to express the hope that it will appear in some of our weekly or daily papers in a more amplified form than it appeared in to-day's journals. I do not propose to go into any detail in relation to this Vote. I am sure that everything that could be said has been said, and I want to avoid repetition as far as I can, so that I may confine my speech to six or seven minutes at the outside, in view of the arrangements already made to conclude this debate at 5 o'clock.

I am satisfied that the Minister has given us substantial reasons for the increases under the various sub-heads in the Estimates, and that is an added reason why I do not want to refer in any detail to the subheads of Estimates. But I feel that there are certain aspects of the housing situation in this country which have not already been touched upon. At least, during the whole of the time I spent here in the past two days I have not heard any reference to some aspects of the housing situation which concern us in Cork and other places. All of us realise the very grave position of housing in this country, and any of us who are connected with the public bodies may know and be fully aware of the slowness and the quantity of red tape that must be unravelled before the real building can commence. We know, of course, that the number one obstacle is the acquisition of housing sites. Here you are up against the greatest red tape. As one who is a believer in the ownership of private property and also a believer, but not a whole-hog believer in private enterprise, but as a believer in property, private or public, I know it is essential that we must have an inquiry, according to law, before we can acquire the property of any other citizen. I am not finding fault with that procedure, except for another reason.

After such an inquiry is made, it is the common practice that many moons elapse before the local authority are told that the proposed site is approved of or disapproved of. We had some classical evidence of this kind of red tapeism which involved the citizens of Cork in a huge sum of money. This huge sum of money had to be paid because of the red tape I have complained of. A site was picked for the building of a hospital. The site was then examined by the engineers of the then Local Government Department during the Fianna Fáil régime, but I am not going to suggest for a moment that it could not occur under this or any other régime. It could occur under any régime so that my complaint is not a pin prick against Fianna Fáil, certainly not. The local authority concerned were told to go ahead with their scheme, the site having been approved by the engineers, but next, another batch of engineers came down from the Board of Works and condemned it right away—condemned, mark you, the scheme which the other officials from the Department had approved of. Can you conceive that happening in any well-ordered community? Can you conceive that taking place in any business enterprise? I am sure that every Senator will agree with me that in no place but Bedlam could such a state of affairs have arisen—one body of Government engineers approving of a site and telling the local authority to go ahead, and, having gone to a whole lot of expense by way of architects' fees and engineers' fees, the local authority has that site condemned by another group of engineers. What I want to impress on the Minister is that all this experience was gained at the expense of the ratepaying community of Cork. There would be a storm if it occurred in another county, but I suppose the Cork people have a reputation for effacing themselves and not making too much trouble.

As I have said, I do not want to delay the Seanad by speaking at any great length, but I would like to call attention to one or two other problems which, from time to time, have come to the notice of local authorities and caused these local authorities to spend a good deal of money. We all know that apart from the preliminary investigations of a housing site, there are the architects' fees. I am not going to try that profession here for getting as much as they possibly can out of the community, but there must be some kind of ratio between the fees which are paid to architects and the wages and salaries paid to other officials and the working-class people who are engaged on this constructive work. I do not want to produce the figures here. I have a set of them at home and they are amazing. You have a building scheme costing £85,000 or £90,000 and you would be surprised to know the amount absorbed by architects' fees alone. All of these fees must inevitably be reflected in the rents the people must pay by and by. In Cork, we have a number of houses let under the differential system of renting—I might say that in this matter, where Cork leads, other counties follow—but we have still the position that we have houses let for £2 or 30/- a week and where people going into these houses will not be able to pay these rents for more than weeks or months. They may reach the stage of unemployment or sickness and what happens then? Those people are evicted and when you evict them, where have they got to go? The whole thing would require the closest examination by some of the Minister's officials to see how it would be reflected in the schemes at a later stage. I would continue to hold a brief for having a public inquiry and giving the vendor, who very frequently is unwilling to sell, the highest possible compensation, but we do know that the price paid for land is altogether too much and that it must be reflected in the higher rents that our poorer people have got to pay when they get the houses.

I propose to support this motion which should be passed by the House. Otherwise, the Minister might find it necessary to have the shutters put up on Leinster House and on the Government institutions, and I am sure that a great many people would not like that, especially when it is coming so close to the end of the month. I want to refer with some amazement to the amount of money being sought. It is colossal for those who remember that, back in 1917, during the fight for Irish freedom, we told the people that the Government of the whole of Ireland could be run for £9,000,000 instead of the £17,000,000 then asked. Things have progressed since and we are going to hand down to posterity a very heavy burden of debt. We propose to let them look after it, but, with the progressive devaluation of money, it is quite possible that the £ of to-day will be paid off by the half-crown of tomorrow. The country, however, will have to meet it. The sums are very large and the borrowing is very heavy and I suppose it is a matter of hoping for the best.

Like Senator Anthony, being an urbanite, I am naturally interested in housing and I corroborate everything he said about the delays. There are people who think that a scheme of houses can go up overnight, or even in a year or two. It takes five or six years at least. The acquisition and development of the sites involve the lapse of a couple of years before building actually commences, with the result that the building of a scheme of house involves a five or six-year plan. In, I think, 1932, when the Housing of the Working Classes Act came in, there was a grant of two-thirds of the all-in cost of a house given by the Government. The all-in cost of a five-roomed house at that time, including the cost of all preliminaries, was only about £350, and there was a two-thirds grant. It has now gone from £350 to approximately £1,200. The ceiling was previously £250, and I think it would be only fair encouragement to urbanities, especially those in small towns with an urban authority, that the ceiling should be raised to 50 per cent. of the all-in cost. If a house costs £1,200 to build, the subsidy or grant by the State should be 50 per cent., or £600, instead of what it is at present.

These costs are falling very heavily on local authorities, because, to fix a rent which the people will be able to pay, the local authority has to take over part of the debt. In my town, we have a scheme of 93 houses, and the town is paying in rates 4/6 per week for each house, as the difference between the economic rent which the tenant can pay and the amount necessary for interest and sinking fund on the borrowed money. The suggestion I make would be a great help to the local authorities because, between county and urban rates, the rates are so high that they cannot go on with any further schemes, if they are to be loaded with a further debt and responsibility of that kind.

It would also help the local authorities greatly if the Department of Finance were more prompt in giving the loans which have been granted. The local authorities have often very heavy overdrafts with the banks. These are sanctioned by the Department, but the bank rate of interest must be paid on them and the amount which they have to pay would be lessened if the grant were forwarded immediately. It is probably due to some confusion arising from all the housing plans, but I hope it will be adjusted because it involves a financial loss for these local authorities.

People in the country are complaining a good deal that the ration of flour and bread has been tightened up very recently and that at present they have not got enough rationed flour for their needs. At this time of the year particularly, when the people are going to the bogs and so on, they consume practically bread only. They can buy off the ration flour—white flour as much as they like of it—but it is almost twice the price and they cannot afford it. I think that, when food is plentiful and rationing practically unnecessary, it would be right that bread, at least, should be derationed so that everybody may buy what he wants. It is, as I say, very important, particularly at this season of the year when many meals are taken out of doors.

A bill of £78,000,000 is a pretty hefty bill, having regard to the amount of the national income but, applying pre-war values to it, it is only the equivalent of £42,500,000. Nevertheless, it is a fairly formidable bill, but if the wishes of the various Senators are complied with several more millions will have to be added to it before we are finished with it. We are all very generous, according to our tastes and ideals, in relation to the various sub-heads, but we then express horror when ultimately the aggregate bill is presented for payment as in this case. Some statements made from time to time are positively reckless in this connection. On 15th of this month, we had before us a Bill called the Minerals Company (Amendment) Bill, which involved the voting of an additional £38,000 to a little coal mine experiment down in County Tipperary. Speaking on the Second Reading of that Bill, at column 882 of the Seanad Debates, Senator Quirke said:—

"I am, of course, very pleased to see the amount increased from £50,000 to £88,000, but why was it not increased to several times that amount?"

For sheer recklessness in the allocation of public funds that would take some beating but, as Senator Quirke is usually a little flamboyant in his language, I should not like to pin him down to that as an indication of his sense of responsibility.

Apart from that, however, there is a general tendency whenever it comes to subsidising anything or to expending money on this, that or the other, for members on all sides to suggest that the State should be more generous and then to hold up their hands in holy horror when a huge bill is presented to us at the end of the financial year. There is also the tendency here, notwithstanding the statements decrying socialism, to move more and more in the direction of what is known as State socialism.

I am not complaining about it, but it was rather amusing the other day on the Transport Bill to hear people who were voting for it trying to salve their consciences by referring to it as a form of nationalisation. In actual fact, this is about as socialist a Bill as has been presented in any Parliament at any time and there is no alternative and no excuse to be made. It was this development of that policy, the fear that one might be accused of tending towards socialism, that made one use these futile phrases. There is an ever-increasing demand for more interference by the State in private enterprise here, even more so than in socialist Britain. In view of that tendency amongst members of all Parties, we must be prepared to meet an ever greater national bill to finance these activities.

The Minister indicated that, because of the amount of money to be spent on capital works, it may be necessary to drawn up a schedule of priorities. If so, I most sincerely hope that housing will have priority of all—certainly, as against all other building works. It is the source of numerous physical and social evils. If we could once get on top of that problem, we would have achieved something of an epic-making character. There is always the danger that, in making too much expansion in any one year, we might create an inflationary condition, resulting in an increase in the cost of living. Much as we want to do all the public work we can, we must try to avoid increasing the cost of living. Most assuredly, any substantial increase would inevitably mean another wave of wage demands. Already it is very difficult to maintain the present position and any increase, resulting in increased wages, would mean a further rise in prices and the last stage would be worse than the first.

There is no justification for any increase. We thought that, as an result of devaluation, there would be a very considerable increase in imported manufactured articles and raw materials. In actual fact, the all over average import price for 1949 was at the figure of 254, as against 259 the previous year, that was 154 per cent. over pre-war, as against 159 in 1948. Right up to September there was a reduction in import prices, but from September to the end of the year there was an increase of 6 per cent., though that left the figure more favourable even than it was in December of the previous year. Export prices increased. They were up by 178 per cent. at the end of 1949, as against 173 at the end of 1948. In this way the terms of trade rose in our favour since 1938, and as compared with 1948 also.

Agricultural prices, of course, to the extent that the produce was exported, benefited by all this development. We can best meet national expenditure not so much by economising as by increasing our own productive capacity. The position, on the whole, is very hopeful. The production in manufacturing industry as compared with 1939 was up by 40 per cent. in 1949. Admittedly, 16 per cent. more workers were employed, but on the other hand, notwithstanding allegations of restriction of output, the average output per worker was up by 18 per cent. as compared with 1939. Real wages went up by only 3 per cent. in the case of manufacturing industry. It went down in most other industries, so that although the individual worker produced on the average 18 per cent. more than in 1939, his real wages went up by only 3 per cent. Between 1947 and 1948 there was an increase in the output per worker by 11 per cent., and there was a further 2 per cent. increase in 1949 as against the previous year. In the same period, within the United Kingdom, the average increase in output per worker between June, 1948, and June, 1949, was about 4½ per cent., with a further 2 to 3 per cent. for the last quarter of 1949.

In these circumstances, I think the charge levelled against workers, at least in the manufacturing industries, of alleged restriction in output cannot be maintained. The contrary, in fact, is the case. There may be some greater justification for it elsewhere, in repairing and in constructional industries such as building, but certainly not in our secondary industries, which have increased in the aggregate in their production to such an extent and also in the case of the individual output per worker. Manufacturers should bear in mind that they have got the thick end of the improvement in our secondary industries. The worker is giving them 18 per cent. extra in output, whilst he is taking only 3 per cent. more in real wages.

I sympathise with the Minister in having to introduce this Bill here for us to consider. I am sure we are deeply grieved he should have to do it in view of the fact that when he was last seeking the votes of the people, together with his colleagues, he assured the people that if they got into power they would reduce taxation. They made the effort for the first year or so in office, but naturally when you come to your second or third term the day of reckoning comes. Now, faced with the day of reckoning, we find that the promises made in 1947-48 cannot continue to be fulfilled. Most sensible people know that when you have an estimate of approximately £58,000,000 and some Parties promise a reduction of £10,000,000 and other Parties promise a reduction of 30 per cent., they are making a promise that could not be fulfilled.

Certain charges fell to be met from time to time and these charges would have been met, irrespective of the promises made by the people seeking the votes. The people who made that promise must have known, as they had experience in administration in years gone by, that if they were to make the effort to fulfil it for one year they could not continue to do that for the normal term of Government, which is about five years. Our bill was considerable last year, but it will be greater next year. That should be a warning to those who go out looking for the votes of the people, that if they make a promise it should be one they intend to fulfil. They should not dangle one in the eyes of the people that they cannot fulfil.

A long period was covered in the debate, from the establishment of the State to 1932, from 1932 to 1937-38 and on up to the change of Government and since then. We have, perhaps, under all Governments, made progress in this country. If you do make progress, there are, at the same time, certain liabilities, no matter what Government is in power. The liabilities that are incurred from time to time must be discharged. If they are not, the State is no longer credit-worthy. The liabilities that were incurred by the Government in 1922 to 1932 were discharged or will be discharged in years to come. The same thing applies in regard to the period from 1932 until the last Government went out of office. That will continue for all time. That is what keeps our State credit-worthy.

A certain amount of progress was made in those years in the industrial field. That has been decried by many people from time to time. Our Irish industries were protected. The Government were quite justified in doing those things. In time of stress and need, when you could not get the things you required from abroad, it was necessary to produce them at home. In their wisdom, the Government that was in power from 1932 to 1948 set out to produce those things that were required at home and, as a result, we had a reasonable degree of comfort from 1939 until the termination of the war. It was very difficult for them because, from 1932 to 1938, they were involved in an economic war, which is very much worse than being involved in actual war. After the 1938 agreement, they set out to do the things we would like to have done in this country and they had been only six months or 12 months in that position when war broke out. Our economy had to be changed over night. Were it not for the wisdom of the then Government in preparing for war, things might have been much worse. They advised farmers to grow beet and wheat and to produce turf. Because of the tillage revival, there were very few, if any, hungry in this country. That policy was bitterly opposed and criticised during those years.

To do those things involved increased taxation. I believe it was money well spent. The war years meant that things had to be left more or less in abeyance and things that the Government would have done and should have done were not done. A year or so after the war there was a change in the position. The successors to the previous Government came into power.

There is increased production in cattle, sheep and poultry. There has been increased production in the industrial field and increases in various other activities. I do not think there is anyone so stupid as to believe for a moment the figures given here yesterday, especially those given by Senator Baxter, who said that all the things that have happened in the last two years were as a result of the change of Government. Were it not for the foundation that was laid by their predecessors, the things that Senators have claimed as having been done by this Government could not have been done. There would not be £20,000,000 additional income arising out of the agreement that the present Minister for Agriculture made with the British Government in 1948, were it not for the agreement that his predecessor made in the year before and were it not for the plans that he had laid during the war and immediately prior to this Government coming into the power. We have been told that the present Minister for Agriculture has been highly successful, but he could not have achieved those things in two years and the people of Ireland will not swallow the dope that is at present being put across by various members in this House and by various forms of propaganda. The foundation had to be laid by his predecessor and he is carry ing on the good work that his predecessors handed on to him.

Everyone will wish the Minister for Agriculture every success and will hope for a continued increase in live stock production. There is one matter about which I disagree with him and about which I believe a number of people on the other side of the House disagree with him, but, unfortunately, they cannot make him see eye to eye with them. It is regrettable that we have not some form of compulsory tillage. I do not suggest that it should be 37½ per cent. as it was in 1938, but, in view of the instability and uncertainty of the European situation and the international situation, it is bad for the national economy, bad for the farming community and bad for the Minister for Finance that there is no compulsory tillage. If war breaks out in the next six months or 12 months it will be regrettable that all the preparations that were made from 1932 to 1948 should have been wiped out simply because the Minister for Agriculture does not believe in the agricultural policy of his predecessor. I say in all sincerity that it is the biggest and gravest mistake not to have some form of compulsion, a moderate form, say, 15 or 20 per cent. A certain amount of wheat and oats should be grown. Let it be subsidised if that is desired, but the State should ensure that the farmer will have such a price for it that it will be profitable. We should not leave it to America or other countries to supply this country with wheat and other commodities necessary to sustain life in the event of war in the next 12 months. It may come. I hope it will not. But if it does, it will be sad if all the things that helped us to survive in the last war are done away with and all the machinery to till the land is lying rusting in the farmyards.

I do not think that the people should be told that the present Government is solely responsible for the progress that has been made in the last two years. If the things that I have outlined had not been done by their predecessors and if they had not taken over the State in proper form, the things for which credit is now being claimed could not have been achieved.

There are other matters that I wish to deal with. One matter has been mentioned by Senator on all sides of the House. I mentioned it a year ago. The Minister told me I was wrong. It is in regard to the revaluation that is going on in this country at the present time. When I spoke about the matter to the Minister on the last occasion, a Senator on the other side of the House told me I was right and the Minister was wrong. I said "you should tell him". There is revaluation going on—you can call it secret or anything else—and there is dissatisfaction with the Valuation Office and I suppose the Minister is responsible for the Valuation Office.

No. The local authority starts it always.

I am chairman of a local authority and have been for years. The Valuation Office have sent out valuation officers to inspect various places in this country without the local authority asking for it.

Will you tell me one place where that happened?

It happened in Laytown and Bettystown, County Meath.

Will you give me a note of that?

You have a record of that. Valuations were doubled and trebled.

On the request of the local authority. After the rate collector sent in a return. You are not speaking of new buildings? In regard to old buildings, it must start with the local authority. That is the law. Go and verify that. May I tell the Senator that I have already had the same question in regard to another county in the south-west where I was also informed that the local authority had nothing to do with it? I was able to turn up the letter from the secretary and that decided the matter.

People in every county and Senators and T.D.s are blaming the Valuation Office.

There is a good campaign to that effect, but it is all wrong.

I do not think it is deliberate because you heard Senator Douglas and various other Senators talking about that grievance that the Valuation Office was going out without request——

They are not.

It is a very strange thing——

We can get a case and on that one case we can finish the matter.

When they go out, the valuation they place on premises is nearly always double what it was. It is sometimes 133 per cent. more, and sometimes 150 per cent.

There are two appeals.

There are, but you know the courts. The valuation inspector comes around, and while in former days he would say a certain amount, and if you agreed it would not go to the court, now he goes back to his office, it is confirmed, and goes ahead.

And you go to the judge.

It takes money to go to the judge.

What is the result of going to the judge?

I know that some amount has come off.

Very seldom.

It is under three or four headings, in effect. It is extraordinary and something should be done. It would be better if the Minister were to face up to the unpopular thing than to have things in the unsatisfactory position they are in at the present time. Most county councils and members of local authorities feel that they have that grievance and that the matter is under the Minister's direction.

I do not think it is political propaganda because the grouch is there. I will investigate the matter with my local authority.

Will the Senator carry to his local authority my denial that this is happening under my direction?

Certainly I will do that. I will ask the secretary of the Meath County Council to produce the file if he has written to the Valuation Office, and the matter will be clarified.

He must do it. That is the law.

It is a strange thing that almost a whole village was revalued. The people are blaming the county council and the State.

I am not disappointed myself at the size of this bill. Eventually, I knew it would have to happen. The segregation of expenditure, whether by the old or the new system, is eventually a bookkeeping transaction, and the segregation of capital expenditure and taxation does not make any difference as far as the State is concerned, as eventually the taxpayer will have to pay. It is a bookkeeping transaction and it does not matter how it is submitted to us.

Captain Orpen

I understood that it was a tradition of this House that on this Bill, we tried, as far as possible, to deal with general principles rather than details. Unfortunately, we have had a certain number of historical reviews that did not seem to coincide with that tradition. One is in somewhat of a difficulty in dealing broadly with this Bill because some of the information which one would have liked to have is not available. For example, we heard a lot about the increase in taxation and the increase on the cover of the Book of Estimates, but surely, the absolute amount of taxation depends, in its severity on the taxpayer, on the national income. We would like, at the same time as having the Book of Estimates, to have a reasonable estimate of the national income. A thing on which we should congratulate the Minister is that capital services and other services are now differentiated in a manner that is both logical and sane. We have not to search the Book of Estimates to find out what the proposed capital services are and what the recurrent services are.

I wonder would the Minister consider it desirable to break down "other services" into broad detail as one would like to see how these services are working. Some you can see quite easily. Take his own Department: "Cost of collection of revenue", "amount collected". The Estimates for other Departments, however, contain "subsidies", that very much abused word which covers all sorts of operations. We have consumer subsidies and producer subsidies. Things are put in and called "subsidies" to make good losses suffered by State and semi-State companies. It may be the correct way to do it but these are very different things. I would like to ask the Minister for Finance whether to-day we are substituting wheat and flour. Is it a consumer subsidy? There is a much more difficult one than that. In the past it used to be said that vast sums were paid by the State to encourage the growth of sugar beet.

If my information is correct a substantial quantity of sugar could be landed here at a price. As to the production of home-grown wheat, I should like to have a direction on that question. For butter there is a consumer's subsidy and a producer's subsidy. As I see it we fix a price for butter for the consumer and fix a price for milk to the farmer. We pay some £2,300,000 at present to make up the difference. I should like to know from the Minister, if we went into the market for butter, could we buy 500,000 cwt. of it. I should also like a little clarification of what changes have taken place over the war years, and the subsequent years, and whether the position is that the producer's subsidy has, to some extent, turned into a consumer's subsidy. Is a subsidy for consumers necessary? I heard one Senator say that plenty of butter is available now, that it should be taken off the ration and that everything would then be grand. Did he mean that the price of butter is to rise to its natural level? Is it not true that the people of this country consume more butter per head of population than any country in the world? I think it is. Do we require more butter? I wonder. The nutritional survey seems to point out that fats are used here in a manner that is most detrimental.

Reverting to the subsidy question, and to the semi-State companies and other undertakings in which the Minister holds the majority of the shares, can we not have in the Book of Estimates, or at some other period, a complete picture for the Oireachtas, showing what these undertakings are costing, how they are working, and the amount that has to be found by taxation? To wander through the Book of Estimates is not an easy task for some of us. Another thing that would be desirable is to have some picture of the redistribution of income and how it falls into various categories or groups.

I am afraid there is no time to go into other matters, but what I have mentioned might help unfortunate Deputies and Senators to see better what is being done by the Minister for Finance, and other Ministers, how the Departments are working, what results are coming from the work of various Departments, so that, at a time when future expenditure is being reviewed, we could have up-to-date information showing exactly where we stand. We might possibly have a contribution of the review which appeared last year indicating where we had gone in that respect and where we were going.

An Leas-Chathaoirleach

I understand the Minister is anxious to conclude at 5 p.m.

I can wait. I am not tied to time.

If the Minister is anxious to get away to any particular function we would have no objection.

I have been listening to the debate. There is no special hurry.

An Leas-Chathaoirleach

Perhaps the Minister would let the Chair know when he wishes to leave.

I think we should try to cheer ourselves up a bit by pointing to the fact that although the Estimates have gone up the demands from several Departments have not. It seems to augur well for the future of the country that more is not being asked for industrial schools and that more is not required for prisons. But I see that we are spending, or contemplate spending in the next year, £15,500,000 on the Department of Agriculture. I do not begrudge it, but very often I hear so much about "the poor farmer", the injustice done to the farmer, while this and that is being subsidised, I should like to point out now that the State is to spend £15,500,000 to help farmers to run their business. A sum of £3,500,000 is to be spent this year on improving the conditions of the land in order to make it more fertile. All that is desirable and is in the nation's interest, but do not forget that the whole of the £15,500,000 and the £3,500,000 that is going to be spent on land reclamation and drainage, and also supplying better houses for farmers, is drawn from the national income.

The individual farmer reaps the benefit, but in a few years he may forget that the State, myself and everybody else, even the labourers and building workers, have to pay out of the taxation they contribute some of the £15,500,000 to help farmers to run their business. Farmers say "Our land is our own, the cattle are ours, the milk is ours, and we will charge what price we like", forgetting that they are subsidised to the extent of £15,500,000 by the taxpayers in order to help them to run their business.

Speaking last year about education, I stated that I did not think enough money was being spent on it. I still think enough money is not being spent on education. Looking through the detailed Estimates for the Departments, I wonder whether some of the learned professors in the universities have wasted their time or the children's time in study. I can visualise a dozen or more people from one Department—the Department of Agriculture—whose duty apparently is to see that hens lay eggs in the customary manner and in larger numbers. Whether they are called inspectors under the Hens Act or under the Dairies Act there is scarcely one of these officials who is not receiving well over £1,000 a year.

A person might spend a great many years studying at a university, or teaching other people to be professors, doctors or technicians and not be as well paid and not have the same pension rights as if he had gone on to tell people how the hens should lay eggs. I do not think enough was spent on education, and I do not want to take out any of these people to draw attention to them individually, but the figures show that the principal in the dairy division has £1,361 a year and a temporary principal has £1,240, while a temporary principal in the poultry and eggs division has £1,286 a year, and so on. I am not saying that they are overpaid, but if you judge them as reasonably well paid, then you are not half paying the people in the universities.

I join with the last speaker in saying that the Minister and ourselves should face the future with hope and courage. I congratulate the Minister on the very good sum he is placing in circulation throughout the country. In past years much good land has gone idle, and until the State came along with this rehabilitation scheme and invested this £3,000,000, most of this land had to remain practically unarable. With regard to the working of this scheme, it is in operation in two places in my county, one on the road pretty close to Dundalk and the other in the Cistercian Monastery at Collon. Anyone who has seen these schemes in operation is pleased at the results and must marvel at the work that is being done. There are at least 250 applicants in County Louth waiting for the machines to come along and, unfortunately, the machines cannot be got in sufficient supply to meet the demand that is for them at the moment.

With regard to the £1,250,000 provided under the Local Authorities (Works) Act, that is a most excellent scheme. I believe it is an expenditure that was absolutely essential. Senator Ruane, I think, mentioned to-day that some drains could not be cleaned owing to the fact that the culverts of roads and bridges were there to bar the way. Perhaps that was correct, but it has been rectified, and excellent jobs have been done by the employees who are carrying out the schemes under the authority of the road surveyors of the district. The Minister, in these two schemes for which he is borrowing this year, will certainly have his name going down in history, just as it has gone down in history already after the Shannon scheme. They are three schemes established under our native Parliament that must fill the people with hope and courage in the rural parts of Ireland.

I am a bit nervous of the butter subsidy business. I am afraid that some morning a Government might decide that some of the agricultural grant might go the other way. I do hope the farming community who will benefit by these schemes, and who, as Senator O'Farrell correctly said, are benefiting from other schemes, will utilise any opportunity that is given to them to see that their occupation in these profitable times for farming will stand on its own feet. Senator Colgan said last evening something that was very true, that for too long the agricultural labourer has been regarded as the slave of the State. I know these labourers. I live among them, and have lived among them all my life, and I suppose I will do it to the end. They are a class which has been neglected so far, but they have taken a new outlook on life since Deputy Dillon became Minister for Agriculture. I do not know if he has made any speech in which he has not referred to them, and the increased employment that has resulted in my county from his schemes and the other agricultural schemes has given the agricultural labourers a more happy outlook on the future. In the past, the problem was to induce people to remain on the land. They left the land because the outlook was not sufficiently attractive. There was a tendency to look upon the land as a life of sacrifice and a life to be avoided, but Deputy Dillon came along and infused new hope into it. No other Minister contributed so much to the welfare of agriculture or the agricultural labourer as he has done.

The great scheme that enables the making of manure in the farmer's yard is the scheme we must encourage. The yard is the place to gather it in bulk. It is very essential that we should buy fertilisers, but the money for them goes out of the country; in the other case, it comes in. Grain growing is a small matter. You sow grain in January or February and you reap it in the autumn and use it during the winter months, but cattle feeding must go on three times each day in the year, and in the winter months the employee is in a shed with a roof over his head when he is preparing it for the live stock. Anyone who listened to Senator Burke here a week or two ago knows the situation on the smaller farms and the problems that were caused by the lack of sufficient money to uplift the conditions of the rural community. Until that problem is remedied all will not be well.

In passing over the Estimates, I notice a sum of £370,000 provided for Posts and Telegraphs. I have also noticed in reading the papers that a special new telephone line was opened recently between Dublin and Bray. There seems to be a special association between local authorities and Bray, a lovely place for boys and girls. We have the Bray Road, too, and it seems to be regarded as a very important place. Do they ever think of the 50,000 people living three counties down north of here? I am not 45 miles from Dublin, but if I want to get a telephone call I find it much handier to write a note and send it by motor car to Dublin, because it only takes two hours, and I know that I would not get a telephone call to Dublin in two hours. What is the meaning of spending money on a new telephone line from Dublin to Bray and neglecting the important towns of Drogheda and Dundalk or neglecting the farmers of County Louth who are giving Dublin all the potatoes that are needed since last August?

Dublin is paying for the potatoes.

Seven or eight years ago you could get into contact with your milkman or your merchant in a reasonable time, but you cannot do that now. You get in touch with the Post Office and make a complaint and they say: "Oh, sir, there is a Butlin's Camp establishment and there are a great many calls to Bray." I maintain that Butlin's Camps and places like Bray should take second place to the agricultural community in the plans of the Department of Posts and Telegraphs, and I urge that an ordinary telephone line should be provided as quickly as possible that will connect Monaghan, Louth and Meath with Dublin.

Perhaps the Senator would include Limerick as well.

I see that the Minister has been pretty busy around Cork and Limerick, but the point I am making to him now is to provide us with better facilities for our business with Dublin. With regard to the housing of the working classes, this is a very big problem for us in County Louth. We are trying to get it solved slowly, and by degrees, but one of the difficulties we have to face is that we have some very bad schools in the county. With regard to education which has been raised in this debate, I am on somewhat different ground. I wish our university professors would soft pedal there. I heard them all talking about it and it is remarkable that no matter what their other disagreements may be, they are all at one, from the various universities from Dublin to Galway, complaining that they want more capital expenditure. They will tell you that the crowds are becoming so vast they have not enough room for them. Then what is wrong? I see big actions by English people who are seeking to get into universities here and yet Senator Stanford tells us that he has seen better universities across the water. Why then the spending of all this money on legal actions?

We are striking rates in County Louth to provide scholarships for students, in addition to the millions being provided here, and I suggest that there should be some correlation between the various authorities contributing to education, primary, secondary and university. There is obviously a need for discussion on the matter of salaries, a matter which does not seem to be flowing pleasantly. The students who gain access to the universities from some of our public authorities may be the students from schools with the heaviest pull somewhere. That is liable to occur.

That is scarcely a fair statement to make. It is a reflection on the universities and the professors.

I am a terrible trouble to the Senator whenever I get up to speak. Is it not my duty to represent my people, and say the hard thing if I think it necessary to say it, and not to be afraid to say it? Why should I lie down for you or anybody else who seems to think he can browbeat me? You got the Minister for Agriculture to apologise for a statement of his last week. His word then was "bumptious." Your words now are bumptious.

An Leas-Chathaoirleach

What exactly did the Senator say?

The Senator said that very often there is a possibility that the students who will gain admission to the university through a local authority may be those whose schools have the heaviest pull.

That is an unfair statement. It is not true.

How do you know whether it is true or not?

I know that it is not true.

How do you know?

An Leas-Chathaoirleach

It is immaterial. The statement should not have been made. No statement reflecting on any institution should be made——

On what institution?

An Leas-Chathaoirleach

——without proof.

On what institution?

An Leas-Chathaoirleach

On any school.

I am 30 years chairman of a county council composed of people of various political persuasions, and I say that a student may come here frequently from a school which has the best pull. I make no reflection on where he is going, because I do not know where he is going.

An Leas-Chathaoirleach

The statement reflects on some schools in this country and it should not be made. The statement means that some schools have an unfair pull.

The statement means that it is liable to occur. I might just as well say that we should not have the Appointments Commissioners, that they are a reflection on the county councils. We are not all hypocrites. I am as long here as most of these gentlemen opposite and I have gained as little out of it and have as few friends in authority as they, but I will say what I have to say and will not apologise to any bully.

Surely it is not fair that, because a Senator draws attention to something another Senator has said, he should be referred to in that manner? I demand that the Senator withdraw his remark.

Withdraw what remark?

An Leas-Chathaoirleach

The Senator will listen to me. The Senator should not say he will not apologise and will not withdraw. If the Chair requires the Senator to withdraw a statement, it should be withdrawn.

What is the statement you want me to withdraw?

An Leas-Chathaoirleach

I am referring to the statement of defiance, that he would not withdraw for anybody.

What is the statement?

An Leas-Chathaoirleach

That is the statement.

That I will not withdraw what?

An Leas-Chathaoirleach

It is a defiance of the Chair.

I must withdraw whatever you tell me to withdraw. What is it?

An Leas-Chathaoirleach

Do you withdraw the statement?

Which statement?

An Leas-Chathaoirleach

The statement that you would not apologise.

I never said any such thing. I said that this gentleman opposite would not bully me or prevent me by bullying from saying what I have to say.

Nobody wants to bully the Senator. We simply said we did not believe what he was saying was true.

You said that about other people too.

That is not bullying him.

I am very sorry and I am very grateful to the Senator. I thought he was, and I apologise whole-heartedly—I understand he was attempting to bully me. With regard to agricultural wages, Senator Burke has regulated the position beautifully, and this House is under a deep debt of gratitude to him for what he told the House some time ago. The Seanad discussed his motion for days, and I say with regret that it would appear that the honours they conferred on him when they listened to him may not have been sincere or they would know why wages were low. The present Government have gone a long way towards solving that problem, and I thank God they are here to do so. The contributions of the Minister for Agriculture have been marvellous and he deserves every congratulation for not being afraid to provide more money for the benefit of rural Ireland. The Shannon scheme, which was sought to be squelched in its early days, is now bearing fruit, and the Minister has now taken up the next best scheme, the scheme of land rehabilitation. I wish him well, and I know the country appreciates it fully.

I belong to the university in control to a great extent of university scholarships, and so far as the examination for university scholarships is concerned it is a perfectly open and correctly run examination in which no pull is exercised by any school. I hope I will be allowed to say that. I do not know what Senator McGee meant, but so far as the university conduct of scholarship examinations is concerned it is done on a fair, free and open basis and nobody has any pull, as the results for any period quite amply demonstrate.

I believe that many people throughout this country are now taking a great interest in the various proposals which have been made with regard to the utilisation of some of our overseas investments on housing and other projects of national reconstruction and development. My suggestion now is that we should at this juncture try to take advantage and make use of the interest now being taken in the matter. Senator O'Brien mentioned yesterday that one way of encouraging more people to sell out some of their overseas investments was to make more attractive the terms of the next national loan. I think that probably everybody will agree with that, but I suggest that we should go further, and, as well as making the terms of the next national loan attractive and encouraging certain people in the country by that method to invest their money in this country, should also appeal to them from a moral and patriotic point of view.

I think that there are many points which a person should study before deciding where to invest his money. One of them, obviously, is the financial terms of the national loan, but I believe that there are many sincere, conscientious and patriotic people in the country who would take other matters into consideration and who would not be entirely influenced by the purely financial return. I suggest, therefore, that this would be a good time to appeal to them to help in a great movement of national reconstruction and social welfare. Senator Mrs. Concannon mentioned the word "conscience", I think, quite rightly, in connection with housing. We should appeal to people to help in the great effort now being made to rid the country of slums and hovels, and to give the people decent houses. Those people, who are in a position to do so, should be appealed to to invest money willingly and gladly in national loans for such purposes. I believe that public opinion could be worked up with regard to this matter, so that it would be regarded as a right and patrioitic thing for people to invest money in their own country. I believe that many people in the past have had mistaken ideas on that subject. It is amazing how many people with even a small amount of capital invest it in England or send it to the four corners of the earth, rather than invest it in their own country.

I will now pass on to the matter of rates of interest on these loans. It is quite natural that many persons investing money hope to get a better rate of interest than they got in the past but there are also many who, from conscientious motives, are willing to invest at a lower rate of interest provided that they feel that by so doing they are doing good. There are, as some Senators know, public utility building societies, and other societies, which have received money from people who have voluntarily and willingly invested it at a low rate of interest, and in some cases free of interest, because by doing so they felt they would enable houses to be let at low rents to families with small incomes. I think it would be an excellent thing if such people were given an opportunity to do this in the future on a much larger scale. They could be told that, if they were in a position, and willing to do so, they could invest money free of interest, or at a low rate of interest, in a special loan, and that the financial advantage gained would be passed on to help families with small incomes by means of a differential rent scheme. Whether many people would avail of that offer or not, I do not know, but I think it is worthy of consideration. Certainly some people told me they would lend money free of interest, or at a low rate of interest, provided that the people who would benefit were people really in need.

I would like to refer next to another system, apart from loans from individuals, whereby it might be possible to advance money for housing purposes at a lower rate of interest. It may be that the Minister may think that this system would not be practicable in this country at the present time. I am merely asking a question, and I do not profess to be an expert. I feel that many people would be glad to hear the views of the Minister, and also of experts like Senator Professor George O'Brien on this matter. This system was known to a few people some years ago, but it was only during recent years that many people have been taking an interest in it. I refer to the system which was in operation in New Zealand some years ago, when Mr. Walter Nash was Minister for Finance there. He stated that his policy of creating new money, issued on the credit of the State, for financing housing projects, had proved highly successful. I agree that that was some years ago, when world conditions were somewhat different, and that it was in another country, but I think it would be helpful if the Minister and others interested would express their views on that system and say whether they thought it practicable to adopt it in this country; and, if not, why not. Under that system, the money was a credit from the Reserve Bank of New Zealand and was in no way subscribed or underwritten by other financial institutions. The policy resulted in the housing authority in New Zealand being able to obtain the benefit of very low rates of interest. The interest charges were settled at 1 per cent. on the first £5,000,000 advanced, and 1½ per cent. on further advances. Mr. Walter Nash, the Finance Minister, then stated that this operation attracted the attention of housing experts and monetary reformers the world over. I think many people would like to hear the views of experts in this country on that particular operation. I agree that some people might say, under present conditions, that it might cause inflation. If the experts believe that to be so, it would be interesting to the public if they would give their reasons.

Another suggestion has also been made by a number of people. It is that the Irish banks might issue a loan of a limited amount, at a low rate of interest, for a special purpose. I have heard some people say that they were not suggesting that it would be practicable to reduce the rate of interest generally on all loans at the present time, in view of the world conditions mentioned by Senator O'Brien, but that the banks might issue a special loan for housing purposes. It would be helpful to hear the views of the Minister on that suggestion. For example, if the banks were to issue a loan of £5,000,000 for housing people with small incomes, at 2 per cent., instead of 4 per cent., that would save £100,000 in interest charges in the first year. That would mean £1,00,000 less in rents, that is the difference between 2 per cent. and 4 per cent. on £5,000,000—and would that many families with small incomes could get houses at lower rents, and would be able to spend more money on food, which would result in the improvement of the health of the community and the avoidance of a great deal of hardship.

However, I am merely putting these suggestions forward for consideration, as I think they deserve consideration, and that the public would appreciate it if the Minister would give his views on them.

In conclusion, I believe we should give careful consideration to any ways and means of enabling people with small incomes to get new houses at lower rents, and I believe it would be helpful if the Minister would give his views on these suggestions.

I must congratulate the Minister that this bill is not a great deal more. Going through the country during the past five or six months and discussing in different places the activities that were taking place, the increases in the Civil Service, in army pensions, old age pensions and so on, people were wondering what kind of sum we would have to meet this year. In fact many thinking people remarked to me that the Minister for Finance must have many sleepless nights. They were expecting a desperate sum. The sum is not very desperate seeing that in the past two years every section of the community has got an increase in wages, those paid from the State, widows' and orphans' increase, but the cost of living has not alone been kept steady but even taking into account what was said yesterday about bus fares, they have to pay less for beer and tobacco which has a great effect on the poor and needy. The cost of living is less than it was two years ago and on that I congratulate the Minister. There has been a good deal of talk about tea, sugar and butter. My friends over there say the sum is too big, yet they want to have plenty of tea and sugar, butter and flour. They do not say that it should be subsidised but it cannot be done in any other way. If it is not subsidised and is let run at its own cost they would get up at every crossroads and say: "Look what the Minister for Finance did to you." They would point out that butter, tea, sugar, flour and everything else could be made available at a reasonable price without increasing taxation a great deal further. Everyone would love if we could get away from subsidies. They are no good. As things are, however, they must go on, in order to keep things at a level.

This scarcity of tea and butter that is talked about does not exist at all. If some little extra has to be bought it it is bought five times cheaper than it was bought some years ago when tea was 28/- a pound and sugar was perhaps four times its normal price. Now you can buy those things freely. It was not the poor people who bought it. They never grumbled and now they can get it at a reasonable price and say that is not increasing the cost of living.

There is another matter that I should like to stress. I cannot understand why butter, outside the ordinary ration, is not placed on the market so that everybody can buy it. I have been asked on several occasions why butter is not available to the people at 3/5 a pound, as it is to hotels. People go short of butter and are prepared to pay that price but it is not available to them.

With regard to capital expenditure, no one in this House can regret the amount that is being provided or the purpose for which it is provided. Already the amount that has been spent on agriculture during the past two years has shown good return. If the money sought is much greater, the people are in a better position to meet it now than they were two years ago and in a year's time they will be in a still better position to meet the Budget. A Senator said that he does not care what the Budget is if the people are in a position and have the ways and means to meet it. That is my view. The people are in a better position now to meet these demands than they were two years ago and any money that has been spent by the Government on capital development is showing a return.

I say to those who complain about the cost of the Budget, the danger of borrowing, the danger of inflation and those who hold that all these schemes were ready, that the last Government is really responsible for them, that we never saw them and never heard of them. They may have been on paper but they had no practical effect on the community. The only scheme we did hear about and that was discussed and that I understand was on paper was a scheme costing £11,000,000 for a new Dáil and a place to house civil servants. If our people had put that scheme into operation, what would the Budget be to-day? Thanks be to God, they did not. They are doing something sensible. They are putting money into something that will produce money and repay the sinking fund.

I do not understand banking but I have often wondered why the State should invest money at a low rate of interest in another country while at the same time borrowing money. That is a matter on which I would appreciate enlightenment. I do not understand it. That has been the practice. All during the war we were investing money outside while raising money and borrowing money.

Then there is the matter of differentiation in the rents of houses. One finds a man who is earning £8 or £9 a week occupying a subsidised house in a new row of houses in a country town and his next-door neighbour is a man earning £3 5s. 0d. or £3 10s. 0d. a week. They both pay the same rent and they are both subsidised houses. I think that is unfair. It is not right to give a subsidised house to a man who can afford to pay for it. Subsidised houses should be for the very needy. There ought to be differentiation in the rents on the basis of what people are able to pay.

Senator Séamus O'Farell said that there has been an increase in production in factories per man during the last 12 months. It seems to me, in respect of those working for public bodies, that each month there is less production, and, in fact, in rural Ireland there is a kind of go slow policy. Everyone feels that he is better off the less he does. If that continues, things will become worse from year to year. There will be less done for public money and we will get to the point where men will hate to work at all. I would urge anyone who has any influence, especially trade unions, to impress on the public the necessity for increased production. If there were better production there could be better wages. For instance, in Bórd na-Móna, where they are paid by piece rate, men can earn £5 and £6 a week who if they were not on price work would not earn £3 a week. If there were more production everybody would be better off. I would urge on trade unions especially the necessity for encouraging more production.

If we have sufficient increase in production we will be able to carry this heavy capital expenditure. I want to congratulate the Minister for Finance and the Minister for Agriculture on the fact that agriculture is taking the lion's share of the money being devoted to capital expenditure. That is, in the opinion of all, where we can show the greatest increase in productivity. I understand that agricultural production has not increased in the way it should during the last 50 years and that there has been chronic under-investment on the land. If farmers made a few pounds they felt it was safer in the bank at 1 per cent. than anywhere else because they did not know what was going to happen. Some of them said it was only during the war that they made money. If the present Minister for Agriculture, with the assistance of the present Minister for Finance, can change that idea that is deep set in the hearts of our rural community and make them understand that there will be a reasonable measure of profit out of the proper working of land all the time, we will get a change in outlook on the part of the rural community. The acceptance of the policy that the major investment of capital money should be in agriculture by the Cabinet, composed of such diverse Parties, has been an achievement on the part of the Minister for Agriculture.

Senator Professor O'Brien mentioned the question of building costs. That matter has worried me for some time past, and many people have referred to it, not least, the Archbishop of Cashel, who mentioned it in opening a housing scheme in Thurles about three weeks ago. I believe that building costs have increased at about twice the rate that any other costs have increased. When we consider the effect that has on other costs, the necessity for the inquiry that was recommended yesterday is clear. In factory, workshop, shop, hospital, and in our homes, building takes place. In the factory, repairs or renewals are put down as an overhead, and are passed on to the consumer. The same applies in the case of the shop or commercial institution.

Senator Ryan referred to houses that are highly subsidised. They are subsidised probably as to 60 per cent. of the cost. Professor O'Brien, in a book which he published about 18 months ago, "The Phantom of Plenty," quoted from an article in the London Times. He said that an investigation was made in Britain. It was the one industry that had not kept pace with modern progress, and had not used science or progress to the same extent as other industries, that it was badly managed, and did not apply modern methods to its operations. So much of the obligation of the State is concerned with building hospitals, schools and houses that I believe it is necessary in the national interest that the Minister for Finance should have a commission of inquiry set up to investigate this whole problem. Maybe one of the causes of the high cost is over-employment in the industry, but that is a question for such a commission to decide. We remember that when there was over-employment in the turf industry all we got was bad turf, and it is quite possible if there is over-employment in the building industry that all we will get is dear houses. That cannot be a long-term policy as the State cannot afford it. Further, if building is so dear the Minister should amortise housing and building costs at a higher rate than other things. If he amortised ordinary capital works like the land reclamation project in 20 years housing should be amortised in 15 years as prudence would take into account the fact that the cost was far too much.

I would have to disagree with Senator R.M. Burke on the question of granting State credit in respect of housing at present prices. If houses could be got at better value we might then see what we could do towards implementing this suggestion about the New Zealand scheme, but with present prices and present bad values it would be very bad to copy what was done in New Zealand in the pre-war period.

Before I attempt to reply to the many points which have been raised in this debate I would like to explain the present position. Knowing the hours at which the Seanad rises from day to day I indicated to some of my friends that I had a particular appointment which I would like to keep this evening. My object was rather to ensure that I would get an adjournment than to rush the House to adjourn earlier than was necessary. I hope that nobody was closed out because of this convenience given to me. I am thankful to the Seanad for the manner in which I have been accommodated.

This debate has travelled over a wide field indeed and I cannot be expected to meet all the points which have been raised, particularly as some of them would call for a much deeper examination than would be possible in the limited time at my disposal, even if I were fully surrounded by expert minds. Some of these things, however, can wait for a better analysis when I will be able to give them the attention they deserve.

Before dealing with the very important matters raised in this debate, in so far as I am going to deal with them at all, I should like to try to get rid of certain misconceptions. I think I could divide the debate on the Central Fund Bill mainly into two sections: those who really would like to criticise —but who have not found it very easy to do it—the programme ahead which is signified by the division of moneys and the extent of these moneys; and those who, while welcoming the division and saying that there is no great threat to the nation's stability in the future in what we are proposing to do, had, however, their own viewpoints with regard to certain directions of the effort. They have made a valuable contribution to the debate. With regard to those who have criticised, I wonder if we could get facts regarding certain things to bring against the fiction in the hope of getting rid of the misconceptions. I am told that I am to be sympathised with because of this vast sum, a sum by which I would be myself repelled. It is agreed that I would like to see the burden on the taxpayers lightened as much as possible, but the excuse is made that there is no way out of this because the increases, as one speaker put it, are mainly due to an increase in the cost of living. That is not so, in so far as it means an increase in the cost of living since 1948.

The Book of Estimates this year includes the payments that must be made on foot of the arrangement made with the Civil Service and following on that the further arrangements made with members of the Garda and the Army in respect of increased emoluments to them. The Garda have always been related, though not exactly tied, to the Civil Service in regard to such arrangements. They have never had a cost-of living bonus but their pay has progressed more or less automatically with that of the Civil Service. The Army, being an allied service, naturally listen in to what is being done in other services and they made claims accordingly. So all three had to be met and met with as much liberality as we thought could be afforded. The situation as far as the Civil Service was concerned was that I found myself in the position that in 1946 a consolidation agreement was come to with the Civil Service, and, looking to the future agreements at that time were couched in the terms that the matter was to be reviewed at the end of two years from the 1st November, 1946, or at any time in the meantime if the cost-of-living index figure went up by 30 points. The figure taken was 270 points so that meant if it went above 300 points. The cost-of-living index figure was three points above 300 and higher than it had been in the latter part of 1947 and it had not decreased to 300 points in 1948. That agreement was made with the Civil Service and I accepted it as a good agreement. The other parties to it, the civil servants themselves, met me and we hammered out an agreement satisfactory to everybody. On that account and on account of increases to the Army there have been increases in the Votes, but propaganda has been directed to making it appear that these payments had to be made because the cost-of-living had gone up since February, 1948. So far from that being the case it has dropped. There are seasonal increases but there was no increase in the year 1948 above the year 1947. Therefore these payments which have been referred to are based on an agreement made by my predecessor in office and I faced my obligations as well as I could with satisfaction to the other parties to that agreement. Therefore, there is no case to be made that any swelling of this Book of Estimates is due to an increase in the cost of living which occurred since the Government took office.

Senator Colgan, referring to a remark of some other Senator, said that it was wrong to say the present Government had increased wages and he went on to the industrial world. The Government has no direct association with wages outside and Senator Colgan was right in correcting the phrase if it were used in that way. I understood it to mean that the Government had increased the wages of those in the public service. So it has. It did not hesitate to follow the lead given by that wages agreement in the spring of 1948. As one person who very often spoke in Dáil Éireann in opposition of the practice during the war of holding wages at a standstill while prices and profits were allowed to soar, I was certainly tied to do whatever I could to see that increases in the wages of public servants and whatever would flow from that would certainly not be objected to if there was an effort to equate the new scale to an increase in the cost of living.

I want to put in contrast to that a phrase used by the then Taoiseach in 1947, when he went to the country and said that he wanted wages pegged. That was one of the statements he made which helped to his undoings, as far as the electorate is concerned. The programme he forecast at that time was that he was going back to the standstill Orders and, at the same time, it was made clear that industrialists did not feel they were going to be hampered in the making of profits judging by the subscriptions they sent openly to the Party funds.

Comment has been made, apart from general comment of the type made by Senator O'Brien, with regard to housing. May I put that correctly before I go into more general matters? Vote 38 of the Book of Estimates dealing with the Department of Local Government contains a number of sub-heads for contributions towards housing charges. I want to call attention to items in the Book of Estimates under Vote 38, sub-head I 1, and various sub-divisions. Under sub-head I 1, there is a total of £757,000 for the year ahead, as against £706,000 last year. That is, £50,000 up. In that one item is a sum of £35,000 this year, against £16,000 last year. That is an additional contribution to loan charges. That is there because, when the particular items concerning interest rates on money which is put at the disposal of local authorities were raised, as they were raised, there would be an additional subvention to meet the cost. That is where it is found. It is being provided and will be paid.

In addition to that, there are further sums found under I 3 and I 6. Under I 3, there is £1,635,000, as opposed to £1,050,000, an advance of almost £600,000. Under I 6, the amount was £60,000 last year, £20,000 the year before, or an advance now of £30,000. I am only taking these items out to indicate the better provision made this year in connection with certain items of the housing programme. I also mentioned in my opening statement that there is an addition of £2,000,000 this year for the Transition Development Fund in order to maintain easements for local authorities provided by the Exchequer.

I do not think anybody can complain of the provision being made, or even on the general matter of segregation of the items as between capital and other services. One Senator stated that whereas the provision from the Central Fund used to be something over 50 per cent. of the cost of a house, it has now slipped and was well below it. I think that was the phrase used. Again that is not so. The figures will vary according to the cost of the house. Take the grant for the average all-in cost of a £1,200 house. The subventions provide now for a grant of more than two-thirds of the loan charge on a sum of £400. That amounts to £266. The Transition Development Fund grant is £400 and there is the subsidy to make up for the increase in interest charges. In the case of a £1,200 house it amounts to £80. The State contribution to the all-in cost is £746, that is 62 per cent.

Is that applicable to the last few years?

I am speaking of only since 1948. That is the position now and was the position last year. The State is providing well over half the cost as a free grant. The rest is divided between the local authority and the tenant. The whole system of financing house building is very confused. There are so many areas from which money is drawn as subventions, I think it is only prudent to have the matter clarified, and to put the subventions on houses on a basis that everybody will understand.

In respect of the general project, I say that we have recognised that a very heavy arrear has piled up in connection with the provision of houses, and that we could do either of two things about it: let houses be built at the normal rate, postpone overcoming that arrear for a generation and a half, or speed up the programme as fast as we can to meet it in a more reasonable time. We have decided to speed it up. Our opinion is that we are speeding it up to meet a wholly abnormal situation. We decided to put that as a capital service. It is not a capital service in the way in which Senator O'Brien described two of the three matters he mentioned. We do not directly provide the money. We raise the general level. There were reasons that Senator O'Brien gave that I think were praiseworthy, and certainly met any of the arguments that were put against us. I want to stress that this is an abnormal situation and we are meeting it in this way, partly because of the abnormality. We are spreading the exceptional cost of houses over a reasonable period and we hope that we will, in a reasonable period, overcome the arrears.

There has been comment with regard to distribution under the farm improvements scheme. I am sorry that Senator O'Reilly is not here to listen to the explanation. The farm improvements scheme is down as one item. It is true that some of the money that used to be found for that purpose will no longer be found. The reason is that there is far more money going to be provided for land reclamation. The scope of the work has been very definitely widened. As far as applications are concerned under the farm improvements scheme, farmers were tied to a narrow range of circumstances, and were so tied that the best they could get was 50 per cent. of the labour content. Now they can get two-fifths of the entire cost. I think applicants will benefit by the change. There were certain small points made and queries, but I say that the building of piers for gates, or the supply of water for houses are items in the farm building scheme, and I assure the House that there is no attempt to restrict the area in which that could be done. That is being carried under a different Vote, and much better provision is made by a greater amount of money while the cost to the applicant is lessened.

On the vexed question of subsidies, or on one part of the question of subsidies, I was asked—in fact I was not asked, it was suggested to me by a member of the Seanad, who said that he did not know the price at which Irish butter was sold on the German market, but he was certain, nevertheless, that it was being subsidised. He spoke, and he revealed himself either from ignorance or from nescience. At all events, he did not know that there is no subsidy whatever on the butter is being sold to Germany. Butter is being sold at a rate which is the economic price. I think, indeed, that there is a slight profit being made over and above the economic price, which will go in relief of the subsidised price here. The quantity we are sending to Germany is, unfortunately, not a very great one—something of the order of 400 tons. I think the figure, in the end, will amount to twice that, but the fact is that there is no subsidy at all. The subsidy has been fully remitted.

On another aspect of the question of subsidies, I do feel that I am entitled to complain. The statement was made here more than once that the present cost-of-living index number is a fake index number. People have not hesitated to use that word in relation to the number, and it has been explained by one member of the Opposition that he used that phrase, seeing that the officials were instructed to have regard in the compilation of the index figure, only to the subsidised prices of limited commodities, and to ignore the fact that economic prices had been fixed for certain commodities where they were brought outside the ration. That is an inaccurate statement. No instructions have been issued to officials to act in the matter that we have heard suggested here. The officials in charge of the compilation of the cost-of-living index figure and their enumerators go round to where they made the same inquiries before. If they find that a subsidised commodity is also being bought at unsubsidised prices outside the ration, in certain quantities, they take cognisance of that, and the figure is made up on the same basis as it was always made up. I am not sure that it is a good thing. I do not think that one should go to the length of providing a commodity like flour at a very reduced rate. If extra white flour is being bought, or if extra bread which is made from unsubsidised white flour is being bought at something approaching economic prices, that gets you into the region of luxury, and should not be taken into account, but, so far as we know, no change has been made in the instructions to the officials who have to compile the index figure.

I might inform the Seanad that that was not always the way and that there was distortion at one time in the index figure. I have already given the history of this to the Seanad, but I should mention briefly now that when Deputy Lemass was Minister for Industry and Commerce and spoke in this House on June 15th, 1947, he made a calculation in his speech that the British cost-of-living index figure was really a false figure. He argued certainly that it was false by comparison with the figure we had here. One of the complaints made by Deputy Lemass when he was Minister was that the British Government tried to keep down the cost-of-living index—not the cost of living—and he went on to explain what he meant.

He said they imposed heavy taxation on tobacco and drink, items which were weighted very lightly in the compilation of the cost-of-living index figure, and he suggested that the British used the revenue to subsidise food prices which were rated rather highly in the compilation of the index figure. At the time he said that is what the British were doing and he gave himself a pat on the back, so to speak, by saying:—

"We do not do as the British do. They only give a light weight to tobacco and drink, and use the revenue to subsidise food prices, which are weighted more heavily in the compilation than the prices of these commodities."

The then Minister for Finance, Deputy Aiken, followed in June, and more or less went over the same ground, but he did refer to English tobacco, cigarettes and drink prices. The burden of his speech, which we have all heard repeated, was that the man who got a few extra pounds in England had to pay a lot more money for certain articles in his daily life in England than a man here. The then Minister for Finance said that the man in England would have to pay far more for the things he needed than he would have to pay here. The Minister was then making comparisons between the terrible prices of tobaco, beer and cigarettes in England in comparison with here.

But in October, 1947, the then Government decided to do what Deputy Lemass had criticised the British Government for doing. In British they had high taxation on tobacco and drink and used the revenue to subsidise food prices. The then Government here went further, and they gave an order or instruction to the Director of Statistics here that he was not to include the increased prices of tobacco or drink in the cost-of-living figure at all. The director was not too sure that the cost-of-living index prepared that way would be a true picture of the cost of living and apparently protested. Correspondence ensued and the Director of Statistics forced his way to this extent, that in the December issue of the Trade Journal he published a note pointing out that the Government had decided that essential items would be the most useful to include in the calculations for the compilation of the cost-of-living index figures. The result was that items such as alcoholic beverages, tobacco and amusements were not considered in the compilation. That was done by Government Order, although these were the things that had been accepted in making a comparison between the British cost-of-living figure and our own cost-of-living figure. The autumn budget of that year increased the prices of alcoholic beverages, tobacco and amusements, but steps had already been taken to see that they would not come into the compilation of the figure in future. That is the history of the cost-of-living index figure here in 1947. It was distorted because it had not been built up as it had been. Certain things were left out. The prices of certain commodities were increased, but they did not want that to be reflected in the cost-of-living index figure, and it ill behoves anybody who was a party to that transaction to say that the new Government, who have not varied the instructions given to enumerators at that time, have faked the cost-of-living index figure. That term should be applied rather to those whom we have succeeded.

Of the smaller points that were made during the course of the debate I do not think I need refer at length to many. Senator Summerfield said something about wireless broadcasting and he made a mistake which I corrected at the time. I could harp a good deal on that phrase of his about wireless broadcasting, and say that I do hope that at a very early stage wireless broadcasting might disappear from the Book of Estimates. It is a service that ought to run itself and it ought to be financed by the fees of those who have to get licences and by the advertisement revenue, or what comes in from the firms who use the station for advertising purposes. In that situation they should be able to cut their clothes according to the quantity of cloth they have and, at the present time, they are getting a fair abundance of cloth.

Senator Summerfield usually casts a jaundiced eye when he speaks here. He talked about the Custom House and described the stones as marble. But, if he can see any marble or luxury building at the Custom House, I would be glad to know where it is. Perhaps it could be shown to me—that is, if he was not looking at the building in Store Street. I must say that any luxury building at the Custom House has escaped, not only my personal observation, but my accountancy as well.

I know that an infinitesimal type of expenditure is being incurred at the Custom House, but it is in stones—I know of no marble. I know that the gardens at the Custom House are being so arranged as to permit of the erection later of a memorial which is to be put there by the Old I.R.A., and to be financed by them. I know of no marble there at the moment. I wish that the Senator would show me some marble around the Custom House and that he would also show me some examples of the fine speculative type of business men that he referred to in his speech. I would insist that he would rule out from that category any man protected by tariffs or by any monopoly arrangements. I would like to hear him telling us something about the fine old independent type of business man—the man who does not want to get something from the State. Senator Summerfield said—and he worked himself up into something of a passion over this—that the working man of long ago would have been ashamed to accept from the State what he now demands from it as a right. If you substitute "business man" for "working man", I think you have a fairly good analogy.

In a speech which was, I think, entirely in favour of the particular matters with which I am concerned, Senator Finan used a phrase which I should like to underline. He said that no one would object to paying a greater amount by way of income-tax if his income was higher. I wish he would go and tell the dairy farmers of the country that and see if he would get a response from them.

The general matters that have been dealt with, however, are the big matters which were brought to a head, and mainly referred to by most of the speakers, in the admirable speech which Senator O'Brien delivered to this House. I think it is a sad commentary upon the Press of this country that a speech of that type should get the limited space it got in this morning's papers. It is probably one of the most important speeches delivered here, and is certainly of tremendous educative value. I hope it will have a very steadying influence on the whole community in regard to this development which we are bringing about, and, since the newspapers have not given it circulation, I must see if it is not possible to give it the circulation it deserves in some other way.

I am very much under an obligation to the whole Seanad, and particularly to Senator O'Brien, for what he has said on this matter, and in particular, I should like to get better known through the country his division of these capital schemes into the three divisions in which he put them. I am very grateful to him for the very lucid analysis he gave of what he considered to be the requirements of any big housing programme. He set out the matters which he thought should be critically examined under five headings: the rate of interest on housing loans; the high cost of building—and there he is referring to labour and particularly to output; the high cost of raw materials—he wondered whether these were being increased to any high point by reason of tariffs or any sort of monopolistic controls; differential rents and sinking fund arrangements; and finally he hoped that all this building programme would be confined to the sector in which the private builder does not operate.

I certainly would take his remarks as a guide to future investigations of this whole housing situation, because there is a danger in this housing situation. Everybody is concerned to get the housing arrear overtaken. We are so concerned that people have often made the remark: "Finance will not stand in the way," but finance may stand in the way. It may not be possible to get the money, but we are far from that point yet. There is a danger, however, in going too fast. Senator O'Brien has put it on the ground of the discontent and the results of discontent which might arise, if we did not go fast enough, but there is this danger inherent in going too fast, that you create, so far as the building trade itself is concerned, a condition not merely of full employment, but of over-full employment. That, of course, has its temptations for everybody—the operatives, the people who provide the building materials, and the contractors themselves.

Apart from all that, there is a possible danger arising from inflationary pressures simply blowing things up. In flation has had its effect already on house building. Many Senators—those who are from provincial areas in particular—have complained of what seems to them the far too great increase there has been in the cost of house building as compared with previous years. Part of it is due to the fact that, when you are pressing on with a programme of this type, you are open to a certain amount of exploration, and, unfortunately, there are people in the country, from all angles, who are inclined to exploit the present situation. That is why I am very gratified by Senator O'Brien's speech in which he gives a careful analysis of seven or eight matters which have to be examined, because, if we are going to make further speed in connection with housing, the dangers are growing and multiplying as we advance.

Senator O'Brien ruled out from his consideration—and I think he was wise; they are better dealt with on another occasion—a variety of things, but he brought in one aspect of a general matter, the general matter being ruled out from his consideration, that is, the Irish banks, the position they are in with regard to their customers and the moneys they have at their disposal for lending. I have on many occasions objected to this whole matter being made the occasion, as it frequently is, for launching an attack on the banks and trying to represent the banks as a group of people unnationally minded and determined, in the words of the popular phrase, to sabotage all the national effort with regard to a variety of matters. I do not think these attacks should be launched on the banks, and certainly the comments made should not be phrased as they are.

Senator O'Brien again put that in its proper perspective when he said that the banks are in a difficult position, because—I can collapse what he said into this—they must keep, by reason of circumstances, the sort of liquidity attaching to a savings bank. Later on he referred to the timidity that may assail the owner of savings, the persion who gathers up and does not spend, the accumulation of all these individual efforts being the amount of the savings we have. They are the people who have to be tutored in all this. It is not the bank directors. It may be that the bank directors are adhering too closely to a system which is a little outworn, but, in the main, they have to attend to the circumstances under which they get money, and unfortunately in this country they get money from people who have not the habit of investing on their own but who simply put money into a bank, and the bank, accepting it in a particular way, says: "We have to be prepared to repay on very short notice".

I think they overdo that, but it seems to me that Senator O'Brien does hold up a warning finger to us—do not have the people who are really saving and putting the money into the banks made timid, because if you do, it is so easy to transfer these moneys, held more or less in a liquid way, across to the English system or the North of Ireland system. That is why I want the Senator's speech given a wider circulation than it has got, because I think we will be able to assure these people that there is no revolutionary movement on with regard to the banks. I think there is some movement that ought to be made by them, and if necessary the Government can get in touch with them and see how far they consider they are tied by circumstances and investigate how far what they regard as their obligations are correctly understood by them. It may be that if necessary the State will have to make some arrangement with them, possibly by some form of guarantee whereby the State would put the banks in the position in which that money which in other countries is used for medium and long-term investment would be provided here for the same purpose, preserving at the same time the depositors' theoretical liquid position. The speech was very welcome from that angle and all that is required is to give it circulation and get these matters discussed in the reasonably calm way in which they were discussed by people who want to change but do not want to break down a system which has stood the test of time.

Senator O'Brien has said with regard to borrowing that borrowing is not necessarily inflationary and I think he went on to say that he did not see any likelihood of inflationary results coming from the borrowing that is being done. At the moment—possibly I did not put this clearly before the House because I mixed up certain funds, not thinking of a single period but moving on to different periods—borrowing, so far as I am concerned, is mainly being done from the Loan Counterpart Fund—this being taken as a sort of Ways and Means Advances that I hope to have repaid quite soon, but I will not be able to repay unless I get money in the ordinary way by borrowing from the public.

When I introduced the matter of other moneys at my disposal, I was referring to such services as national health insurance where there are certain accumulated funds. These are there for investment, but they are being invested in particular ways at the moment and I think it is possible that a change might be made there. Again, I can assure the House that nothing revolutionary will be done. I think the moneys could be put at the disposal of the country for the development of our resources and we will try to have it done in that way, but it will have to be done with the consent of the people who own the money. We will have to try and talk them into a better frame of mind, if we can, in regard to the use of these moneys, through the instrumentality of the various lending agencies.

I come back to one of these misconceptions. I welcome Senator O'Brien's explanation of the phrase that is often quoted from the Banking Commission Report. No doubt, in 1938 the Banking Commission did advert to the dissipation of sterling assets and criticised that; but the difference between what was being done then and what is being done now is this—and Senator O'Brien used something like this phrase—that the Banking Commission were looking at savings being dissipated because of the poverty of people at home. No doubt, at the time of the economic war, there were people cashing in on certain investments merely in order to live on them. It was not a case of changing the source of investment. They could not get money from other sources where they were entitled to get it and, therefore, their investments disappeared. That is not the situation at the moment. Any money that is being taken home is being switched over from one type of investment in England to another here, from one good investment there to one equally good here, giving an equally good rate of interest and the same amount of security, if not far better security. The security in a home investment is, in the main, a better one than that in a foreign land. I think the history of foreign lending over a long period—this will apply to the nations that used to be creditor ones and had big sums of money to lend— has been that more than 50 per cent. of the foreign investments have been lost. We have lost a certain amount of what can be called our foreign investments. I do not think anyone would have any hesitation in accepting the lessons of history and deciding to accept the better security at home.

The second last misconception is with regard to what is called the increased bill for the public. I think that, if only to mark the change, while the ordinary Estimates and the Vote on Account pertaining to them should be taken at this time of the year, there would be something to be said for the capital side of the year's expenditure being taken at a different period, in order to get it put better before the public. There is a great deal of confusion when one comes to deal with this Book of Estimates. There are Estimates proposed to be met out of ordinary revenue and then you have the segregation of capital items, or you find the segregation is done in the Budget. It may be better to mark this change by breaking the tie and letting one see how the two accounts run. It would mean several opportunities for debate instead of one. Someone might say that the time would be wasted, but I cannot complain of that for the last couple of days here. Public debate helps to educate the public mind and it would be a good thing if Deputies, Senators and Ministers could afford the time.

Misconception naturally arises as to whether or not the taxpayers' burden has been increased. I say it has not been. It has been said two or three times that the people who form the present Government made a lot of promises about reducing taxation. They have reduced taxation. If that is doubted, will the people who doubt it look up the Order made between 18th February, 1948, and the first week of March, 1948, taking off the duties which were put on in October, 1947, on tobacco and beer? That Order is still operative. It lost me, in connection with finance, some £6,000,000 or £7,000,000, which was given back to the community. That £6,000,000 or £7,000,000 was to be taken from them through that tax. People who look at the Finance Act, 1949, will find that income-tax has been reduced by 6d. and there are certain other reliefs, supposed to cost about £1,250,000 in a full year. There is no doubt that taxation has been reduced. Other taxes would have been taken off if the people who form the present Government had not decided that the obligation on them, deceived from their promises, made it necessary to increase the pay of civil servants, Garda and Army, to give more to old age pensions and to increase the tea ration and therefore increase the amount of money for subsidy. I had the calculation made several times and gave the figures in detail. There is £11,000,000 that is either saved or else is switched expenditure from certain other things to these payments for old age pensions, civil servants and so on. There is, as between the reduction of taxation and the switched expenditure, a sum of about £11,250,000.

An attempt is made to confuse the issue by saying that Fianna Fáil spent only so much in their last year. That was all they were allowed to spend. They brought in a Supplementary Budget in October, 1947, but they forecast the expenditure for the full year and that was reflected in the Book of Estimates, and when I came first into contact with it it contained that figure which I have often spoken of, £70,500,000. It is true to say that Government expenditure in certain areas is going up and it is also true to say that the public are subscribing, through lower rates of tax, a very big revenue. That is because we are on an up wave. Senator McGuire has referred to the fact that, even though income-tax is less by 6d., it is bringing in pretty near the same amount as last year. We have to take not merely the reduction of the 6d. but also all these other reliefs which, in a full year, would cost £1,250,000. We find pretty much the same amount of money is coming in. That can be explained in a variety of ways. The taxpayer in his capacity as taxpayer has been relieved. Groups of individuals all over the country are providing the revenue we require for the running of the State at the moment. There has been a reduction in taxation, and a considerable one.

Senator O'Brien was good enough, when opening, to refer to the Shannon scheme. I am very thankful to him for what he said and very complimented by what he said about it. I did not hear it mentioned or think of it again until Senator Quirke mentioned irresponsible statements and then I did think of the Shannon again. People who know only now of the Shannon scheme as an accomplishment have no idea of the way in which its birth was greated. I have a series of quotations here. One newspaper said that

"the whole business was a gamble", that

"the board I was setting up would need to be super salesmen if they were to justify the Minister's optimism."

An editorial said that it was

"bad and dangerous"

and

"it was to be hoped that the Seanad would insist boldly upon its right of amendment and delay."

Another newspaper told me the Bill was

"State socialism in one of its crudest forms"

and said that

"no Socialist Government could go further than I was going in that regard."

It said that no Socialist Government could go further than I was going and it was a mild comment to say that we were taking a big risk on it.

One leading article thundered in this way:—

"The country as a whole is afraid of this scheme. It is too uncertain in results. The money could be better spent. The Shannon scheme is premature and ought to be suspended. By acknowledging that fact now the Government would do the greatest service to the nation and to itself."

We were told in another comment that the scheme was audaciously speculative and that the Government

"has yet to justify the strictly preposterous policy of organising power on a great scale in the hope that the supply will create demand".

Finally—and I always took this to be a sort of personal reference—we were told that the Ministers of the Government were young and ardent, that in the desire to get things done they were knowingly taking great chances, and that they treated some national interests in the most arbitrary fashion.

Another paper wound up by saying:—

"The present scheme for the Electricity Board bids fair——"

this sounds a mad comment at the moment, but it was in tone with all the others at the time——

"to develop into a crazy, overgrown megalomaniac enterprise whose financial foundations are from the very outset unsound."

It would be interesting if we had the names of the papers from which the extracts have been read.

I do not think it is worth while saying which they were. They were all in it. Another paper said that:—

"Once the Oireachtas has given its blessing to this procedure, the thin end of a socialist wedge will have been driven under the fabric of this State——"

and this was meant to have effect—

"and capital, ever-fearful of invasion, will be encouraged to seek refuge elsewhere."

Into that atmosphere the politicians thrust themselves, and Deputy MacEntee talked about the £10,000,000 that had been squandered on the Shannon scheme. It was later, of course, that he made his famous "white elephant" speech. They were all at it. Deputy de Valera, in 1926, said that he was against it, that it was a grandiose scheme, but that it was no time for grandiose schemes when the country was being bled white by emigration. He said that the best part of the employment was given to foreigners, engineers, and others; that the capital would be sunk for a considerable period, and that by the time it was working the people it was intended to employ would have been driven out of the country.

At Wexford, Deputy de Valera asked would not Wexford men get more employment from a protective tariff on agricultural machinery than they were likely to get from the Shannon Scheme for many years. We were told that commonsense dictated that this scheme should be done on the smallest scale possible and that we should educate our own people. Later, he said that the scheme had already cost so much that if his Party were the Government they would probably go ahead with it rather than let the project fall through when so much Irish money had been spent on it.

Deputy Lemass said that the purpose of the Electricity Supply Bill was to provide against the anticipated failure of the Shannon scheme. He said the people were on the horns of a dilemma, that they had to choose between the failure of the Shannon scheme and the Electricity Supply Bill, with all its objectionable features. He said that it would be a national disaster of the greatest magnitude if the Shannon scheme were a failure. Finally, Deputy Lemass wound up by telling us that war was coming and that we could not escape being embroiled. He said that a successful air raid on the headquarters of the scheme could leave the industries in every city and town paralysed and a reign of darkness over all the country.

These were what I call irresponsible statements. These political people projected themselves into the atmosphere previously created by all these Press references to State socialism and speculative gambles.

I am very glad that sense has been learned in the years and we have not anything like that comment on this venture which is, of course, nothing like as speculative—if I may say so now—as the Shannon scheme was. We intend to spend money in certain ways. I put that to the people asking them to criticise the schemes we put forward, to criticise them from different angles, to see were they properly in the capital area or not, to criticise them in detail, to say if any detail is there that should not be there and to pronounce whether it is proper to meet these things in the way in which we propose to meet them. I think what we have done already this year has so far met with a good response from those who have had time to consider it and those who have given any thought to it.

We believe that the strong creditor position that this country occupies is a guarantee of her ability to undertake this programme of domestic capital investment. I believe this domestic capital investment will increase the national prosperity, give more employment and help to stem emigration.

In the Dáil I quoted from the Taoiseach when he said to the Institute of Bankers last November this—Dáil Debates, Volume 119, No. 16, column 2506:—

"Public finance in the past has been mainly preoccupied with the annual Budget, although this covered no more than a fifth or a quarter of a country's economic activity. To-day, however, it is generally recognised that to discharge fully its economic responsibilities the Government must budget not primarily to allocate a certain part of the nation's finances to public purposes, but must also ensure that the resources of the nation are utilised in the way which can best advance the interests of the community. The community has to be considered not merely as taxpayers but as producers and consumers as well, and the level of the national income may be regarded as the best indicator of economic progress. The Government can best influence the community's prosperity by a sound budgetary policy and by investment. As long ago as 1936, the late Lord Keynes declared that the duty of ordering the current volume of investment cannot safely be left in private hands."

I divided that into four principal points and asked if I could get agreement on all the four points. I suggest to Senators that that paragraph ought to be accepted by everybody and that it does at least indicate that we are getting ourselves in line with modern economic thought on this matter of public investment. We have examples from other countries which have developed in this way and made a success of it. What has been done here has been accepted in the main, I think, by modern economists. To that extent we are certainly not doing anything revolutionary.

I did say to the Seanad, and I want to repeat it, that there is bound to be as a result of this extensive borrowing programme certain monetary repercussions. These certainly are possible, if not certain. I should not say "bound to be," but they are likely. That requires vigilance, and that requires a certain control over the expenditure on these schemes, and I have indicated that with colleagues of mine I am going to establish such control, and to have this progress in an ordinary way. I am giving that now as a warning that it may not be possible, if certain things develop, to spend all the money here provided and for the other under the line services in the coming financial year but, if things go well, we hope to get on with the development that this money allows.

I have been asked by a particular person whether, when the State proposes to raise a loan, if the returns of the loan are passed to the revenue authorities for income-tax purposes. Would the Revenue Commissioners inquire into the source of capital in the event of a person investing in any loan the Minister may float in future?

I would like the Minister to make a definite statement on that. I hope the loan will be a success.

I would not attempt to start another debate, but may I make a suggestion to the Minister, that in addition to the five aspects of housing which Senator George O'Brien has asked him to examine, he will consider the cost of securing and developing sites in and around the cities because there is virtually a black market in housing sites and ground rents in and around Dublin?

Question put and agreed to.
Agreed to take remaining stages to-day.
The Seanad went into Committee on the Bill.
Sections 1 to 3, inclusive, put and agreed to.
SECTION 4.
Question proposed: "That Section 4 stand part of the Bill."

Section 4, as far as I can see, provides for the setting up of a special fund called the American Grant Counterpart Special Account. I should like to know for what purposes these moneys may be utilised. Already in the Finance Bill of last year we have provided for the setting up of the Counterpart Loan Fund. We are now arranging for the setting up of the Counterpart Grant Fund. The necessity for having two separate funds must indicate that there is some difference between the uses to which these moneys will be put.

I would also be glad if the Minister could give us any indication of the amount which has accrued in the Counterpart Fund already and which may be available for expenditure during the coming financial year.

The Counterpart Fund or the Special Account?

The Loan Fund.

The amount there varies. Under the legislation the amount has to be put before the Auditor and Comptroller-General and he will present it eventually to the Oireachtas. Up to date there is £20,000,000, which may be taken as a round figure, and the Special Account has £1,071,000 in it. The Special Account is governed by the Economic Co-operation Agreement, and the text of that is:—

"The Government of Ireland may draw upon any remaining balance in the Special Account for such purposes as may be agreed from time to time with the Government of the United States of America. In considering proposals put forward by the Government of Ireland for drawings from the Special Account, the Government of the United States of America will take into account the need for promoting or maintaining internal monetary and financial stabilisation in Ireland and for stimulating productive activity and international trade and the exploration for and development of new sources of wealth within Ireland, including in particular:—

(a) expenditures upon projects or programmes, including those which are part of a comprehensive programme for the development of the productive capacity of Ireland and the other participating countries, and projects or programmes the external costs of which are being covered by assistance rendered by the Government of the United States of America under the Economic Co-operation Act of 1948 or otherwise, or by loans from the International Bank for Reconstruction and Development;

(b) expenditures upon the exploration for and development of additional production of materials which may be required in the United States of America because of deficiencies or potential deficiencies in the resources of the United States of America; and"

—I want to emphasise this—

"(c) effective retirement of the national debt, especially debt held by the Central Bank or other banking institutions."

As the Senator will have noticed, that specifies money drawn on a remaining balance. Under the agreement the United States Government are entitled to demand a certain percentage for transit purposes. They are also entitled, as Senators see, to ask that the projects to which the money will be applied will be approved by them, in other words by agreement.

Question put and agreed to.
Section 5 put and agreed to.
Bill reported without recommendation and received for final consideration.
Question:—"That the Bill be now returned to the Dáil"—put and agreed to.