Everybody in the House will agree on the necessity for national development. It is a matter on which all Parties in the State are in substantial agreement. The history of this country is one of underdevelopment in the past. There have been a number of unfortunate influences impeding the development of the national resources and it is a very right and proper thing that an Irish Government should do everything it can to build up the resources of the country. At the same time, I agree with Senator McGuire that private enterprise is the best way of developing the country. Everything he says is, in my opinion, true; but I am afraid we have to admit that private enterprise, in the circumstances of Ireland at the moment, is unlikely to develop sufficiently fast to solve the unemployment problem to any great extent and to open up investment in all desirable directions.
There is a certain lack of tradition of investment in Irish business and a certain lack of knowledge of opportunities amongst the agricultural community. As was said by Senator Johnston, the ideal type of national investment would be the investment by farmers of their savings in their own farms. That, we hope, will come with the passage of time—it is largely a matter of education of farmers regarding the openings and the opportunities in their own industry.
I also agree with Senator McGuire that the high taxation of individuals and companies has a deterrent effect on private enterprise. It is extremely difficult for anybody to-day to save any money. The whole system of income-tax, profits tax and death duties is a deterrent to saving. I am glad that the Minister for Finance, whose absence from this debate, we regret, has acceded to the wishes of the Seanad in setting up an inquiry into income-tax—with special regard to the effect of income-tax on business. The result of the report of that committee may be to take away some of the disincentive effect of the present taxation system.
We must all agree with Senator Douglas that the spending of public money is not an end in itself, that, other things being equal, the less public money is spent the better, and that anything in the nature of competition between political Parties on a spending spree is wholly deplorable. Having said all that, we must admit that the present Bill is justified in the circumstances of the situation. Public investment is being pursued in every country in the world to-day, and, although I quite agree with what Senator McGuire said regarding the mixed type of our system—not being clearly either capitalist or socialist—we are only following many other countries, which are quite as individualist as ours, in extending the field of public development. I think the extension of public investment is inevitable in the 20th century. My attitude towards the Bill is that it is a regrettable necessity. It is a second best, but, at the same time, it is a necessity, and therefore we should welcome it. We should direct our attention in the Seanad to making some constructive criticism in the direction of seeing that the Bill does the most possible good and the least possible harm.
A particular aspect of the Bill which strikes me as requiring discussion is the need for a consistent policy by the Government in administering it and clear thinking regarding the purposes of the Bill. One matter which I wish to emphasise very strongly is that, in the debates in the Dáil and in the Bill itself, there seems to be a certain confusion of thinking between the aim of employment and the aim of national development. The two are frequently spoken of as if they were synonymous, the fact being that measures which give a great deal of employment may not do much to develop the country and measures which do a great deal to develop the country may not give much employment. It is necessary for the Seanad and the Government to be perfectly clear what the object of this legislation is. If I thought the object of the legislation was merely to deal with demonstrations of unemployed, I would be entirely opposed to it. I have frequently said in the Seanad that the finding of work out of public money for work's sake is not justified in our situation to-day. Therefore it is very important that we should have an assurance from the Minister that the object of the Bill is not merely relief works or doles or the giving of employment but definitely the building up of the resources of the country, with the hope of giving not merely temporary employment, but, as Senator Johnston said, some measure of more permanent employment, so that when any particular scheme has been completed, the employment will not come to an end and another problem will not have to be faced.
Therefore, I think the question of the choice of investments is very important and I will come later to that question again—who is to make the choice of investments? We are giving in the Bill considerable discretion to somebody to invest public money without specific parliamentary sanction, and, in doing so, there should be clear guidance given to the Government as to what are the wishes of the Legislature regarding the directions in which that investment should take place. In the first place, I should say that one object that must be ruled out is work for work's sake. The classical case which is always quoted is the Keynes example—digging holes and filling them up again. That is not the type of employment which we wish to see given under the Bill.
In choosing schemes under the Bill, choice will have to be made between schemes with a high labour content and schemes with a less high labour content, and I suggest that the labour content of a scheme should not be the decisive criterion of its desirability. I suggest that, where schemes are more or less equal in other respects, a high labour content is preferable to a low labour content. I suggest that there might be some preference given, even when things are not entirely equal, to schemes with a high labour content, because we all agree that the stemming of the tide of emigration is a benefit for which the country should be prepared to pay a certain price.
I gathered from the Minister's introductory observations here and the debate in the Dáil that the amount of money spent under this Bill will vary with the condition of the balance of payments. I gather that the powers in this Bill will be used as a sort of thermostat to keep employment stable, that when the balance of payments is good more may be spent and when it is bad less will be spent. It is perfectly proper and in accordance with all modern approaches to the trade cycle and balance of payments that the Government is entitled to vary the amount of public expenditure in accordance with changes in the business climate and the state of trade.
I take it that it is the intention of the Government that, if the balance of payments position is unsatisfactory, no money will be spent under this Bill and that if the balance of payments position is unfavourable all expenditure under this Bill must be clamped down. The justification given by the Minister in the Dáil for the introduction of the Bill was that the balance of payments had become favourable and that, therefore, expenditure of this money could be afforded. I take it that the Minister accepts the truth of the converse of that proposition— that if the balance of payments position becomes unfavourable expenditure under this Bill cannot be afforded and will, therefore, come to an end. Even if the balance of payments is favourable, it is to be hoped that the expenditure under the Bill will be of a kind which will help to make it more favourable in the future, that the criterion of expenditure will always be ultimately the strengthening of the balance of payments.
A mere temporary improvement in the balance of payments caused by some quite fortuitous factor, such as an improvement in the terms of trade, should never be allowed to justify a mere spending spree on unproductive expenditure. Even when the balance of payments is quite favourable, expenditure under this Bill should be very judicious and very carefully chosen and not wasteful. It should not be designed simply to provide work for work's sake and to stop unemployment at any cost in order to keep the unemployed quiet and prevent them from sitting down in the streets of Dublin.
As was suggested by a previous speaker in the debate, there always is the danger that expenditure of this kind may help impair the balance of payments. Therefore, I suggest that the Oireachtas is giving the Government in this Bill certain powers which may be used for good but, if unwisely used, may be harmful in their consequence. The justification for the Bill is that certain circumstances change rapidly. The Dáil is not always in session, Estimates have sometimes to be debated at length and action must be taken without delay. There are many circumstances which change in an unforeseeable and rapid manner.
The unemployment situation changes not only in regard to nations as a whole but in regard to particular localities. As Senator Johnston has indicated, the cessation of some types of public works may leave a train of unemployment in its wake. The openings for productive employment change from time to time. Governments must have the same keen eye for productive openings that a good business man has. Finally, the balance of payments itself changes quite rapidly as a result of changes in the terms of trade, import and export prices and all sorts of influences which may develop quite rapidly and quite unpredictably. The fact of these changes and the necessity for rapid action are the justifications of the Bill.
Parliament is abrogating part of its function and part of its sovereignty in this Bill. It is giving to the Administration the choice of the objects of public expenditure and the handling of public money without specific votes and individual estimates. It, therefore, becomes a matter of great importance for Parliament to be sure, in abrogating its function, that these powers will not be abused. The question we must all ask is: "Who is to make the decision under this Bill?"
In previous debates on cognate subjects in this Chamber I referred more than once to the recommendations of the Banking Committee for a national investment council. That is a matter which was not implemented in the Central Bank Act which implemented other recommendations of the commission. I always thought that it did not receive sufficient attention from the Government of the day. The growing volume of public investment has rendered the recommendation of the Banking Commission more rather than less urgent.
When this Bill came forward, it occurred to me that some sort of advisory body of that kind might be usefully constituted to supervise the operation of the Bill. Parliament is handling over a large amount of money to be spent without direct responsibility and, therefore, there should be some sort of check on this large public expenditure. In reading the speech of the Minister in the Dáil on the 10th February, column 95 of the Parliamentary debates, I see that there is a reference by the Minister to the National Development Committee. It seems perhaps that the body for which I have been pleading has existed all the time, but so far as I know this is the first reference in a parliamentary debate to the existence of this body.
The National Development Committee could be a body of very considerable importance in the country. It is not, as far as I know, provided for in the Constitution or in any statute. Therefore, I would welcome some statement from the Minister in his reply to this debate as to precisely what is the composition of this National Development Committee to which he referred in the Dáil, for the first time, to my knowledge.
What I suggest is that, where Parliament is giving to the Government powers of a discretionary nature in spending public money, there should be some machinery for combining the general principles laid down in the Bill with the requisite flexibility necessary for rapidly adjusting policy to changing circumstances. There should be some compromise between the dilatory procedure of individual estimates, which may take months to go through the Dáil and quite arbitrary decisions taken by Ministers, possibly on the advice of a committee of this kind which we have now heard about for the first time. Such decisions may be dictated by purely political considerations and even if not dictated by purely political considerations, may be regarded by public opinion as being so dictated especially at times of approaching elections.
Therefore, I suggest to the Minister that some sort of machinery is necessary to combine consistency and flexibility, and that in introducing this Bill a very good opportunity has arisen for reconsidering the recommendations of the Banking Commission regarding the necessity for a national development council. Those are the only observations I have to make on the Bill which I welcome in its general principles.