It always strikes me as curious that, each year, as we find the sum of money in the Book of Estimates increasing, it is said that the burden on the community is becoming unbearable, but yet, when we look at another set of figures purporting to give the national income, we find that the figures in the Book of Estimates seem to be moving most remarkably in step with the figure given for the national income. For example, the amount in the Book of Estimates in 1942 was £38,000,000 and it is now £83,000,000. The national income in 1944, the nearest year I can get, was £253,000,000 and is now £352,000,000. In 1938, the figure was £158,000,000, which gives a very rough idea that public expenditure is more or less moving with the estimated national income.
In the White Paper on National Income and Expenditure recently issued, we find some very interesting phenomena. In Table 7, dealing with expenditure of personal income in the main categories in 1938 and 1949, we find a rise in food which is slightly over double. Much the same ratio is to be found in relation to alcoholic beverages and tobacco but clothing, on the other hand, has increased nearly two and a half times. I do not propose to weary the Seanad with all these figures, but, while some of these expenditures have doubled, the figure for gross personal rent has remained almost stationary. Travelling has increased about four times and amusements are over double. The following table, Table 8, gives the same categories of personal expenditure calculated back to 1938 prices and virtually gives you the change in volume as between 1938 and 1949. We find a slight increase in the volume of consumption of consumed goods at market prices. There is an increase in food, but the biggest increases are in respect of services which, presumably, are less essential than food. In other words, every item in this analysis tends to show that the consumption of nonessential goods and services has increased more than consumption of the essential ones. I say that is all to the good. That is a very firm indicator of a rise in the standard of living and it is something we should welcome.
I do not think that I will go further into the information given in this White Paper on National Income but one should bear in mind, when complaints are made that the cost of living—not the cost-of-living index—has increased substantially over the years, that one should relate that to the movement over the period of the national income. The burden of the cost of living on any individual is primarily a function of his income. Naturally, in a period when prices have changed, it is quite clear that the cost of living, measured in prices, cannot remain static and, unless the consumption is less, expenditure on goods and services must go up.
I have one complaint to make about the Book of Estimates in that the ordinary Senator who is not an accountant finds the gravest difficulties in disentangling to-day the various subsidies that appear to be in operation. They are hidden away in all sorts of curious places. As they have reached a very substantial amount, I feel it is not quite right that they should be so obscurely hidden.
If we take merely the so-called food subsidies, the subsidies on bread, flour, sugar, tea, butter and other items, they are, of course, in every sense of the word, purely consumer subsidies. It is well to stress that point because, in the early days of the sugar-beet growing, clearly, it was the farmer or the grower of sugar-beet who was assisted by way of subsidy and, for many years, sugar could have been bought from outside at a lower price than obtained in this country. Now the reverse is taking place or, at any rate, let us say, so that there will not be an argument, you cannot buy sugar outside the country as cheap as it is manufactured in our sugar factories. I think they claim that in or about £44 a ton, in bags, ex factory, is the home price of sugar of 98 polarisation.
Recently, we find, by going into the open world market, that the various subsidies and stabilisation funds in respect of butter have, at any rate, ceased to be subsidies to the producer. Anything that is now paid comes in purely as a consumer subsidy.
One would wish that the methods of dealing with bread and flour, the subsidy scheme and repayment scheme, was a little less obscure. Some of us have tried to wade through the report but the more we delve into it the more difficult we find it is to see what is happening, how everything is working. The only feature that does emerge from that report which I think it is as well to draw attention to, is, that it seems to me that the method has been devised to secure a fixed return on the capital invested in flour mills and wheat mills irrespective of the efficiency or inefficiency of the concern. That is the only conclusion I can come to from reading the report.
On the question of subsidies, this Government inherited from its predecessor a curious form of consumer subsidy, a subsidy down to a fixed price. It was thought necessary that butter, sugar, and so on, should be always subsidised down to a certain price, and that policy has more or less continued. I would very much like to hear the argument that seeks to justify subsidisation of any essential commodity down to a fixed price—in terms of pounds, shillings and pence, of course —at a time when prices are rapidly rising and, fortunately, at the same time, incomes are rising or, if one likes to regard it as such, when there is a change in purchasing power. It seems to me that quite powerful arguments are required to justify a method of subsidisation which attempts to fix a price at a constant level when everything else is moving rapidly. However, perhaps it is an inherited characteristic that is unalterable.
There are several other features of our financial position on which I should like to say a word or two. I should like to deal with the question of the £30,000,000 gap between imports and exports, allowing for the invisibles, but not taking into consideration the £8,000,000 correction which the Minister for Finance told us was due to the change in the terms of trade. Suppose we take the values of agricultural exports and industrial exports in 1950. In this calculation I am making, I am giving credit, as agricultural exports, to some things that are sometimes looked upon as purely industrial. There is portion of Guinness' exports, which is in the form of an agricultural product, and I am crediting agriculture with that. This rough calculation shows that agricultural exports in value in 1950 were just about three times that of industry—£54.5 millions as against £15.9 millions. If we look at the other end of the picture, the import figures, out of total imports of £160,000,000, £13.7 millions are indubitably imported for agricultural purposes and £146,000,000 for everybody else but including imports to people who are engaged in agriculture which are generally distributed. What I want to bring out in these figures is that we have got this £30,000,000 gap; who is going to fill the gap?
As I see things in agriculture, we have provided three times the exports that industry can claim. Though I have not made any calculations, I should very much like to know what the raw materials imported for industry actually amount to. Though our industrial production since the termination of the war has risen in a very remarkable manner, I should like to see if possible a more rapid rise in exports. While the volume of agricultural exports has risen, to alter the volume of production of agriculture is a slow process; you can comparatively easily substitute one product for another in industry but you cannot make a rapid alteration in certain classes of animals. If we are going to fill this £30,000,000 gap in a reasonable amount of time, we cannot very easily fill it by means of export of agricultural goods because the growth is too slow. If you could add 5 per cent. in volume per year you would be doing remarkably well. If industry can fill that gap, seeing that it has some chance of rapid expansion, well and good, but surely what we should look to to-day is to see if it is possible to reduce some of these imports. I think the Minister in his opening statement in the other House rather drew attention to the possibility that some of these imports could not be classed as essential commodities, that there was a considerable amount of imports that possibly were non-essential, and, in the light of the fact that we had this comparatively large adverse balance, he suggested that we should do something to close it. by restricting the imports of non-essentials. I think that if the public knew a little more about our position, that we were importing non-essentials, possibly a certain amount of curtailment in imports of that type of goods would come about, without having recourse to actual restrictive and prohibitive methods.
There is just one other matter I want to mention. We have this large number of consumer subsidies. I have asked to hear an argument for the justification of our subsidy down to a fixed price. I am now going to refer to one other system of subsidisation which I should like to call the hidden subsidy. Very appropriately it deals with hides. I do not know exactly when the methods of keeping down the price of hides in this country was first devised, in order, as I am told, to assist boot manufacturers. The boot industry may require assistance; I do not know but I do question the method, if my information is correct, of what I might call the hidden subsidy on hides. There are one or two other cases where assistance is given to one section of the community or to one activity, in an obscure manner. If we are to help an industry in its early stages or any section of the community at any time, I do not believe we should hide the process. We should make quite clear what is being done. I have been a rather long time complaining about this obscurity to the ordinary man in the strect who is not an accountant. How much help the community at large is getting over these food subsidies is not made as plain as it should be. We know it is difficult sometimes to find out what other help is being given to various activities of sections of the community or certain State services. We know it is difficult, sometimes, to find out whether State moneys are still being given to help some of our external companies. I know that one can find that out by asking questions and making a study of it.
I feel that it would be helpful, at any rate to Senators, if these matters could be put a little more clearly and brought a little more into evidence. One gets rather the feeling that sometimes there is something not quite nice about public money being given to assist in keeping down well, not food subsidies, but in sponsoring or helping certain activities. I think we should know all about these things, and that the information should be easily available without putting one to the bother, first of finding out, and then asking questions. Now that we have separated capital expenditure and current expenditure in the Book of Estimates, which has been of immense help to people in seeing how we stand, I think that these various devices of assisting one section of the community, or one type of activity should be shown quite clearly, so that there can be no confusion.
