Electricity (Supply) (Amendment) Bill, 1954—Second Stage.

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

Mr. Lemass

In its main purpose this Bill is not dissimilar from other Electricity (Supply) (Amendment) Acts which were previously debated by the Seanad, all of which had the main object of providing for the growing capital requirements of the E.S.B. The main purpose of this Bill is to increase from £65,000,000 to £100,000,000 the statutory limit of expenditure which the E.S.B. may incur for capital purposes other than rural electrification.

This Bill is different from those that preceded it because it proposes to change the method by which the capital needs of the E.S.B. will be met. Heretofore, the board secured the capital required for development, within the limits fixed by statute, from the Exchequer. In future it is proposed to permit the board to have direct access to the public for its capital requirements. That change in the method of financing the board's development involves certain other consequential steps to which I will refer later.

The other main purpose of the Bill is to raise from £8,000,000 to £16,000,000 the statutory limit of advances which may be made to the board from the Central Fund for its rural electrification activities. The White Paper which was circulated with the Bill gives in considerable detail the programme of capital works upon which the board is now engaging or works in respect of which they have already entered into commitments. The full cost of these capital works already approved will involve the sanctioning of expenditure by the board up to a limit of about £120,000,000. The £100,000,000 limit fixed in this Bill will secure the position of the board until 1956. Before some date in 1956 another amending Act will be necessary, but it was not considered desirable to make the provision for the whole of the estimated expenditure on the present programme of the board in this Bill, in the belief that the Houses of the Oireachtas would prefer to have another opportunity of looking at the programme, at the progress made and the general situation prevailing in about two years from now.

I have said that advantage is being taken of this Bill, and it was necessary to do so because of the proposed change in the method of financing, to tidy up certain loose ends in the board's finances. The first and most important of these relates to the position of the Shannon works. The agreed liability assumed by the board in respect of the Shannon scheme which the Minister for Industry and Commerce was authorised to construct under the Shannon Electricity Acts was something over £6,000,000: to be precise, £6,030,066. The money required for the construction of the Shannon scheme was made available to the Minister for Industry and Commerce out of the Central Fund and, although the works were transferred to the board by the Electricity Supply Act, 1927, they remained vested in the Minister. It is now proposed to vest them in the board. One of the reasons for taking that step, apart from the desire to regularise the position, is that it is necessary to enable the board to make a charge upon all its assets as security for any stock it may issue.

In addition to the £6,000,000 representing the agreed liability assumed by the board in respect of the Shannon works, there is a further sum of something over £38,000,000 which represents the total of repayable advances made to the board from the Central Fund for purposes other than rural electrification from the date of the establishment of the board up to the 31st December last. That money has been expended upon various works which the board was authorised to undertake under the different Acts. Of the total liability representing the sum of these two amounts, £38,000,000 and £6,000,000, the board has already repaid £1,961,000, but for the purposes of this Bill no account is taken of such repayments in calculating the authorised total of capital expenditure.

Apart from its right of access to the Central Fund to meet its capital requirements, the board has two other sources of financing available to it: one is the board's own depreciation reserves and the second is the superannuation funds. The board is, as the House is aware, because it was a matter of some debate at the time, under a statutory obligation so to adjust its charges for electricity as to make adequate provision not merely for its day-to-day expenses but also for the repayment of the moneys borrowed by it and for the replacement of its wasting assets. In accordance with that statutory obligation to replace its wasting assets the board sets aside every year out of its revenue sums which, accumulating over the life of these assets, will, it is estimated, be sufficient to provide for their replacement when they reach the end of their useful life.

The board is authorised by existing legislation—in fact, by an Act which was passed for that purpose in 1941— to invest these reserve funds in trustee securities or in such other securities as may be approved by the Minister for Finance. But, in fact, the board has not availed itself of that power and has used these reserves for the provision of new capital assets according as they were authorised under the successive Acts. In other words, the board's depreciation reserves have been invested in its own undertaking, which is a desirable practice both from the point of view of the board and from the point of view of the Exchequer. Again, it is, of course, to be understood that all sums used by the board in that manner must be included in the authorised total of the board's capital expenditure at any particular time in order to calculate whether or not the level of that expenditure is within the limits sanctioned by legislation.

The Electricity Supply Board (Superannuation) Act, 1942, provided for the introduction of superannuation schemes on a contributory basis by the board's employees and for the management of those funds by trustees. That Act authorised the trustees of those funds to lend to the board such sums as they thought proper to lend and the board was authorised to borrow from these funds for any purpose arising out of the performance of its function. That arrangement is mutually advantageous. It provides for the trustees a very convenient and a very easily realisable form of investment, the value of which remains constant, and for the board it provides a convenient, additional source of finance. The total amount which the board has borrowed from the trustees out of the superannuation funds to date is £1,646,500.

I do not propose to go into detail now on the board's development programme. The House, as I have said, has an opportunity of considering that on the basis of the White Paper. The primary object of all this development is to increase electricity generating capacity to meet the growth in demand for electricity. The board now estimates that the demand for electricity will double in every period of five or six years. It is clear, therefore, that we have to contemplate continuous additions to the board's installed generating capacity, at any rate so long as that expansion in demand is anticipated. From the point of view of the state of development of this country, it is clear that that development can go on for a very long time because we are still well behind most European countries either in terms of installed generating capacity or in the consumption of electricity per head of the population.

The main aspect of the new generation programme, to which it is perhaps desirable to direct attention, is that it is based almost entirely on the use of our native resources. The programme puts emphasis on turf fired stations and on water power stations. In so far as the turf fired stations are concerned, the board's programme is, of course, complementary to the Bord na Móna development programme which I outlined here last year when the Turf Development Bill of 1953 was before the Seanad. When that co-ordinated programme has been completed, the generating stations using only turf or native coal will use annually, it is estimated, about 2,500,000 tons of milled peat, about 400,000 tons of machine-won sod peat, and about 120,000 tons of hand-won turf which will be consumed in four small stations which are being set up, mainly for social reasons, along the western seaboard. The average annual output of all our native fuel stations will be over 1,500,000,000 units, which compares with the total output of 1,300,000,000 units from all the stations of the E.S.B. in 1953. Indeed, I may say, that if our past experience is any guide, these estimates are likely to be exceeded.

In the two turf-fired generating stations which are now operating, not merely was the output of current considerably in excess of the original estimates, but the consumption of fuel is also, consequentially, in excess of the quantity originally estimated to be required.

On the completion of this programme we will have at least 63 per cent. and, possibly, more of the total installed electricity generating capacity of the country based upon native resources, either upon native fuel or water power, so that our dependence on imported fuel for electricity requirements will be very considerably reduced. That will be a happy position to be in when one considers our experience during the recent emergency.

The board, as I have said, has since its establishment been financed from the three sources which I have mentioned: the Central Fund, its own depreciation reserves and the superannuation funds. These sources will still be open to the board, but, as I have mentioned, it is proposed to confer new borrowing powers on the board. The principal new borrowing power is that contained in Section 4 of the Bill. That section authorises the board to borrow money by the issue of its own securities. It enables it to obtain its capital requirements in future from sources other than the Central Fund. The total of £25,000,000 which the board has been authorised to borrow under that section is, as I have said, estimated to be sufficient to meet the board's requirements in respect of actual expenditure upon projects, other than rural electrification, until the end of March, 1956. In each case, the terms and conditions of the issue will have to be approved by the Minister for Industry and Commerce and the Minister for Finance, and it is stipulated that the uses of the moneys to be obtained by the issue of the board's securities will also be subject to the approval of the Minister for Industry and Commerce.

These provisions are designed to provide the assurance that the board's development programme will be along the general lines of which the Government has approved, and that there will be no departure from that programme without the approval of the responsible Minister. In view of the magnitude of the programme and of the large proportion of national capital investment which it will absorb, I think it will be accepted as essential that such an assurance should be given in statutory form. From the investors' point of view, there are distinct advantages in the existence of a provision which will ensure that the programme for which they are being asked to subscribe has the approval of the Government.

I do not think that any fears may be entertained that the board will not now be able to finance its future development in the way proposed. The undertaking has developed to the stage at which it should be possible for it to obtain its capital requirements from the public and it need no longer rely on the Central Fund save in exceptional circumstances. The liabilities of the board are amply covered by its fixed and liquid assets, and it, of course, enjoys the great advantage of being the sole producer in a market which is constantly expanding and in which the scope for expansion is, as I have indicated, almost unlimited.

The securities issued by the board will be trustee securities and may be underwritten by the Minister for Finance. The Bill also empowers the Minister for Finance to guarantee these securities. To the extent, of course, that the board can obtain its capital requirements other than from the Central Fund, the State will be correspondingly relieved from the necessity of providing for its requirements. The House, no doubt, is aware that a considerable proportion of the proceeds of recent issues of Government stock have had to be earmarked for the Electricity Supply Board. It will also make available, on our rather limited security market, a new and attractive type of security which it is hoped will attract an additional class of investor who may not normally invest in Government issues but who, it is hoped, would be prepared to invest in the board's issues.

The type of securities to be issued will, of course, be governed by the statutory position of the board. That position does not permit of the issue of stock with voting rights, but the board will nevertheless have considerable freedom of action and these issues should be of the type to make a wide appeal to investors.

I mentioned that the Central Fund will still be available to the board, and the Bill authorised the Minister for Finance to continue if necessary to make advances to the board within the authorised limit. The sole purpose of that provision is to ensure the board will have available to it at all times the moneys required to enable its development programme to go ahead without restriction. It is intended, however, that the Central Fund will only be a secondary source of finance, and that in future advances will be sought by the board from the Exchequer only for the purpose of tiding the board over a period during which it might not be convenient or desirable for one reason or another to seek capital from other sources. The Central Fund will, therefore, be the lender of last resort, and is not likely to be called upon to any great extent.

We have kept rural electrification outside all these financial arrangements. The Bill provides for an increase from £8,000,000 to £16,000,000 in the total of advances that may be made to the board for rural electrification and, as I said, the board will continue to draw on the Exchequer for its capital requirements for the rural electrification scheme. The reason for that is that the rural electrification service will continue to be subsidised and it is, therefore, thought desirable that it should be financed exclusively by the State. Aside from the fact that it would be inappropriate to seek money from private investors for a subsidised service, the continuation of the present arrangements is more convenient and simple from an administrative point of view.

I mentioned in the Dáil that there were two developments in relation to rural electrification to which it was desirable to attract attention. The first was that a change has been made in the method of determining the priority of areas selected for development under the scheme. Up to the present the system was that the area which gave the board the best financial return got priority over other areas. While there was justification for that arrangement from the board's point of view it was often unfair to many rural areas where the financial return was not dependent upon the number of residents willing to take supply. On the other hand there was objection to going completely on the basis of the number of the local residents willing to accept supply because in a very thinly populated area 100 per cent. acceptance might be possible whereas in a thickly populated area the more normal level of 60 per cent., 70 per cent. or 75 per cent. acceptance would be regarded as good.

A formula has now been worked out which brings both factors into the calculation, the financial return from the area to the board and the percentage of local residents willing to accept supply and on that basis the order of priority is determined. The new system gives an added argument to those who are canvassing a rural area to get the scheme extended to it, pointing out that the larger the number of residents who accept supply the better are the prospects of early connection; at the same time it tends to weigh the selection in favour of the more densely populated areas as against the more sparsely populated.

The second point I mentioned in that regard was that the rate of development under the electrification scheme has been speeded up considerably. Last year, following discussions with the board, they agreed to increase the rate of development by 50 per cent. and so organise themselves as to get a further 50 per cent. increase this year. Therefore, from this year on the rate of development under the rural electrification scheme will be double what it has been previously and that holds out the prospect of the whole scheme being completed in five years' time. It also involves a very considerable increase in the number of people employed on rural electrification work which is not an unsatisfactory consequence either.

Those are the main provisions of the Bill but there are some other minor provisions to which reference should be made We are excluding the board from the application of the Public Authorities Protection Act. The Government is at present considering the possible amendment or perhaps even repeal of that Act but it has been decided that in so far as these statutory bodies are concerned that Act should not apply. Provision in that regard was made some time ago and advantage has been taken of this Bill to provide for the exclusion of the board from the application of that Act, that is, an Act which limits the time in which actions for tort may be taken against public authorities.

The second point I want to mention refers to the pension provisions for members of the E.S.B. itself. I am not quite sure what considerations induced me when introducing that legislation in relation to superannuation for board members to provide that they should get the very awkward calculation of 20/48ths of retiring salary, but when that legislation was being framed it was assumed that 20 years' service would be the normal in so far as men would go to the E.S.B. usually late in life and would not be able to give effective service longer than that period. The whole-time members of the board have now over 20 years' service. Apart altogether from adopting the normal provisions in relation to superannuation arrangements, that alone would justify changing this 20/48ths to the more usual 50 per cent., 24/48ths. I am taking advantage of this Bill to make that change which will provide that members of the board will receive half their salaries on retirement. These are the main provisions of the Bill. The Bill was, I am glad to say, received enthusiastically by all sections of the Dáil and I am sure that, having regard to its character, it will be received equally enthusiastically here.

Mr. Baxter

The last few remarks of the Minister puts one in the position in regard to this Bill at least that he expects one to follow the general trend. After my experience on the last measure one is almost fearful in this House of saying anything that appears to be in any way questioning any line of national policy being pursued. In fact, you whisper to yourself: "Have you the right to speak, or why did you come here or why were you sent here?" One must say for the Minister that he is more rational than some of the people who appear to follow his policy or to drive him along the road on a particular line. He recognises that it is a good and healthy thing for the people, for the House and for the country, to make a rational examination of national policy in a big problem like this. We are all agreed on the importance of electricity development. Some are converts. The Minister was converted to that point of view after I was. I had the privilege of being a member of the other House when his predecessor in office introduced the original Bill. The Leas-Chathaoirleach was a colleague of mine there. I can recall some of my colleagues in the Farmers' Party in those days being very doubtful and critical and conservative about what this young and enthusiastic Minister was going to put across the country, but I was just as enthusiastic as the Minister himself was about the development of power from the Shannon.

We have marched a long way since those days. The Minister can cast his mind back and think about what he thought about electricity development then. It might be of interest to the Minister to know that I took home to my own home a German paper some years later, I think a year after the completion of the scheme. That German paper—I think it was the Berliner Tageblatt—carried a balance sheet of the Siemens Schuckert Company, which revealed losses of a considerable amount on the work they carried out on the Shannon. Our Irish engineers and supervisors watched the Germans so well that they made them do their job and apparently it did not pay the Germans too well to do it.

That is past history and we are considering to-day the future of this immense undertaking. Immense it is: one feels that it is almost greater than the State itself. It is growing at such a pace and the capital commitments are so very large in relation to our total assets, our total income and our total productivity, that the E.S.B. to-day is just a colossus straddling the whole country. It is a very great enterprise and the nation can be proud of it and proud of the contribution successive Ministers have made to its development. I wonder whether the State and the people and especially the members of the Oireachtas should not now sit down and study the future of this organisation. We have a great deal of the national capital invested in it. There are demands for increased power in every field which can hardly be met out of our present resources. There will have to be further development. There is this truth, recognised by everybody, that the cost of electricity to-day in every field— whether industrial, agricultural or in domestic circles—is a very considerable drain on the national income. The proportion which we have to pay away for the production and sale of this commodity, which is so valuable and attractive for all of us, is a rather heavy charge on the total expendable income which is available to us. We are going on and on.

There is a great deal which is not known to the populace about this development. We get the report of the E.S.B., we get periodic statements of policy from Ministers— this Minister, to a great extent—on future development; but whether what we are doing is the wisest policy in regard to the production of power for the future or not, is something about which I think some of us have certain doubts. The nation has now reached the stage when it would be very wise for the Oireachtas to do something like setting up an all-Party committee to study the proposals, and the implications of those proposals, for the further development of electricity within the State.

The Minister is telling us that this legislation for which he is asking our approval will enable him to put the securities of the E.S.B. on the market, a new type of security; but it is important to recognise that the value of a security, the security behind a security, is dependent not only on the production but on the cost of the production and the capacity to sell and the capacity of the purchasers to buy. The cost of electricity to-day in this State is relatively high, in relation to our income and in comparison with prices outside. The cost is made up by the capital charge, the labour that goes into the work, the labour of producing the raw material, the labour on mechanical and electrical work that goes into the production of power from peat, and all of the other processes that have to be entered into in setting the machinery going, including the sale of the current and the collection of the payments by the E.S.B. All these added up make a position here where, taking into account the cost of money and of the raw materials and so on, the charges are such that I at least am convinced that the future development of electricity in the country requires re-examination.

When the first scheme came along, the Minister for Industry and Commerce in those days was only able to get it across with great difficulty, and only because he was able to produce the evidence of foreign experts. I do not know that we want foreign experts on this. I am not against having them, it might be good to intersperse some foreign experts with people we know; but I would seriously suggest to the Minister that the cost of production of electricity in the future, with our resources being developed close to the point where we may have to look for new sources of power, into new fields that may make the whole undertaking much more economic than the kind of development that has been done up to the present, indicates that the time has come for a fresh survey.

I have supported the Minister in his peat development schemes in this House. I am prepared anywhere to state my view on that. But when the Minister points out that his new development of four small hand-won turf stations on the western seaboard is being done mainly for social reasons— that was what he said and we accept it that that is so—it seems to me that we have reached the stage when we must contemplate whether we are justified in a capital development in regard to electricity that is going to consider social conditions, and be engaged for social reasons rather than because it is an accretion to the total development of electricity which is essential. I know we could not have the power that we are utilising to-day but for the development of our peat bogs. I want to suggest to the Minister—as I said on another occasion, when he had his Bill before this House—that, in my judgment anyhow, social conditions would be best served by another type of utilisation of our peat resources in these western areas and that that ought to be carefully studied before we engage in the utilisation of peat in a rather uneconomic way for the production of power.

I seriously suggest to the Minister, with the fact behind me that I have enthusiastically approved of his endeavours for the development of our peat resources, that in the work that is being done elsewhere in the country, down in the bogs of Gowla, therein lies a medium upon which the social uplift of the people in the western seaboard can be much more effectively brought about and in a way that will be much more lasting than what he is attempting at the moment. It was that phrase of the Minister's that suggested to me that we have reached the stage in electricity development when the whole position should be studied anew. Between the Minister and the E.S.B. and the people who are producing power there must be a great deal of discussion of which the public know nothing. I am not charging the Minister or the E.S.B. or Bord na Móna with conspiring to take out of the pockets of the taxpayer or the consumer money that should be left in them but I am convinced that in regard to the whole national position we have reached a point when we should study the situation anew. While we have established that we can produce power from native resources we ought not to close our minds to the fact that the cost of all this may be such that the consumers may not be prepared to continue to pay.

The development in rural electrification is encouraging. Many districts are making valiant efforts to avail of this service. There are difficulties to be overcome. I do not know that any of the methods adopted by the board have been complete. Although there may be people in a district who are not prepared to sign a document asking for the service, they will be influenced to avail of the service when it is brought to the district and they see it in operation in their neighbours' homes. I would have no hesitation in making whatever contribution can be made to extending the scheme throughout rural districts. There has been a falling down in some areas. In Cavan there are some districts in which efforts have been proceeding for two or three years. If the board were not so exacting with regard to the number of possible subscribers before making the service available they would find that when the wires would be brought across a district everyone would want to avail of the service.

That is all I have to say on the matter at this stage. There is a number of matters that we can discuss on Committee Stage. At the moment we are glad to support the Minister in this Bill.

Mr. Yeats

It is an extraordinary thing that whenever Senator Baxter speaks in this House he is almost always enthusiastically in favour of something or other but unwilling to do anything about it. He told us early this afternoon that he was enthusiastically in favour of industry but objected strongly to the imposition of certain duties. He has told us now that he is enthusiastically in favour of turf development but he thinks we should do nothing about it and should sit down and reconsider the whole matter.

Mr. Baxter

That is ridiculous. I said nothing of the kind.

Mr. Burke

He said no such thing.

Mr. Yeats

He said that before proceeding with the present scheme by means of turf——

Mr. Baxter

Hand-won turf—that is all—hand-won turf—that is what I said. I have it written down.

Mr. Yeats

That was not the impression I got.

An Leas-Chathaoirleach

The Senator will accept Senator Baxter's statement?

Mr. Yeats

I am very pleased to hear it. I understood Senator Baxter to say what most of the members on that side of the House said on a previous Bill that came before us, the Turf Development Bill.

Mr. Baxter

I am prepared to accept the Minister's view of what I said.

Mr. Yeats

I am delighted to hear that Senator Baxter is, in fact, in favour of this because I remember, when the Turf Development Bill came up here, what a number of speakers said.

Mr. Baxter

What did I say on that?

Mr. Yeats

I have no memory of what Senator Baxter said. I remember Senator Hayes expressing the greatest doubt as to the possibility of producing electricity from milled peat.

Mr. Burke

Are you quoting from what he said?

Mr. Yeats

I do not think that Senator Hayes would deny for a moment that on the Turf Development Bill he expressed considerable doubt as to whether the milled peat process was sound.

An Leas-Chathaoirleach

If the Senator would come to the Bill before the House it would be just as well.

Professor Hayes

What about my character? I do not remember what I said about the Bill but I did not say that I had doubts as to the possibility of getting electricity from peat.

Mr. Yeats

The possibility economically.

Professor Hayes

Ah well, now. That is another question.

An Leas-Chathaoirleach

Will Senator Yeats deal with the Bill before the House?

Mr. Yeats

The Senator expressed doubts, in regard to the scheme as it stands at present, of producing electricity from milled peat.

Professor Hayes

Of course.

Mr. Yeats

If every single one of the Senators on the far side of the House who has ever spoken about turf were to say now that he is 100 per cent. in favour of it, we still have the position as to what happened when they were in power. Actions speak a great deal louder than words. However enthusiastic they were, however much they were in favour of the production of electricity from turf, in fact the position is that when those Senators or their Party were in power, between 1948 and 1951, not one single turf-generating station or hydro-electric station, in addition to the programme as it then existed, was sanctioned by that Government. Instead of that, a most retrograde step was taken. Even as long ago as before the war the Fianna Fáil Government of the day gave instructions to the E.S.B. that all future electricity development was to be done out of Irish fuel resources, by means of hydro-electric schemes or turf schemes. That instruction was given. Yet the position was that the only two additional generating stations sanctioned in the three and a half years from 1948 to 1951 were two big stations, one in the City of Cork and the other in the City of Dublin, designed to use imported coal or imported fuel oil. I do not care what Senator Baxter, Senator Hayes or any other Senator said either to-day or any other day, the fact remains that was the position when their Party were in power. I have always felt that it was a most unfortunate and most retrograde step that those two big stations in Dublin and Cork should have been sanctioned.

The Minister has told us to-day that, when the present programme has been completed, 63 per cent. of all our electricity supplies will be generated from Irish fuel resources. That is undoubtedly a satisfactory figure. It could have been so much better; it could have been, possibly, 75 per cent. or even higher, if the Government that was in power between 1948 and 1951 had stuck to the previous decision, had in fact acted upon their apparent enthusiasm for Irish turf development and had gone ahead with the turf development schemes instead of going back to the system of producing electricity from coal or fuel oil.

Be that as it may, I should like to congratulate the Minister on bringing in this Bill to-day. It is a very great thing for the country that all this development should be taking place, a great deal of it taking place in parts of the country where very little development of an employment-giving nature has been carried out. It will be a very great thing for very many remote areas. It will produce electricity which is very badly wanted.

There are one or two points which Senator Baxter, in his enthusiasm, mentioned, and that I think it is desirable to deny. He suggested that electricity is very dear in this country. I have no idea what it costs in other countries, but the increase since before the war has been in the region of 40 or 55 per cent. as against a general increase in prices of about 100 per cent. Bearing in mind the fall in the value of money, it would therefore appear that electricity is somewhat cheaper now than it was before the war.

Here, again, I may have misunderstood Senator Baxter but I took him to be worried as to whether perhaps this form of electricity development was liable to be more expensive than other forms. I think it should be made clear that there is every prospect that the cost per unit of producing electricity from milled peat will be cheaper than any other form of production. Certainly, the schemes so far in operation for producing electricity from sod turf have been extremely successful from the point of view of the cost per unit. With regard to the hand-won turf, Senator Baxter suggested that perhaps it was undesirable to bring in schemes of this kind for largely social reasons. There might be a difference of opinion on that matter. The areas where it will be in operation are very badly in need of——

Mr. Baxter

I think General Costelloe's scheme for Gowla bog would be better.

Mr. Hawkins

It could not be applied to the particular area.

An Leas-Chathaoirleach

Senator Yeats, without interruption.

Mr. Yeats

The areas where these stations will be located are quite different from those served in the general scheme. The point I want to make is that the total production of electricity from these small stations will be minute in quantity compared with the production under this programme. I have not gone into the figures, but I understand that it will be a small fraction of 1 per cent. of the total production. It can have no possible effect on the price of electricity. These are very small stations, producing very small quantities of electricity compared with the total amount required. Senator Baxter need have no fears that these schemes will have an ill effect on the general price level of our electricity.

Mr. Burke

Undoubtedly, this is the most important industry in our country. Ours is a small country and the E.S.B. will have, when this new Bill becomes an Act, permission to raise their capital to £100,000,000. It is an enormous sum of money and whether this business is well run or badly run will affect, in large measure, the future living standards of all our people.

I think Senator Baxter is quite right in asking that there should be a permanent parliamentary committee of both Houses of the Oireachtas to stand over a semi-State undertaking of this enormous magnitude. I also think he is right in asking for the fullest information that can possibly be received with regard to the efficient management of the company and, further, I think he is right in inquiring whether the various projects to be embarked upon are sound from the economic point of view.

I should like to know—and these figures have not been given to us by the board—how the present cost of electricity for industrial purposes compares with the present cost of electricity supplied to industries in other countries in Western Europe. Obviously, if we are to have a decent standard of living here we must be able to export—and cheap power is very important to business. Cheap power is a very important item in every industry and we should have information on that matter.

With regard to the question whether we should generate our electricity from turf or from imported fuel, I think that is a matter in regard to which the various pros and cons have to be balanced. I remember that, when the national paper mills were being established in this country, it was the intention to build the mill on a bog so that they might use the turf. The position that was presented to the people about to develop that project was that the turf in any bog on which they would build the mill would be all used up in 25 years and that, by that time, they would have built around the mill a town with a population of anything maybe from 5,000 to 8,000 people. When the local turf resources for the purposes of that industry would have been exhausted, they would have found themselves with, if you like, a white elephant of a town. It was then decided that it would be better to erect the mill on another site. I want to know if there is an analogy there in regard to the development of electricity in the same way. Would we use all the turf in the bogs and then have to move the power stations to other sites? I realise that electrical power generating plant wears out and it is possible that the plant would be worn out by the time the bog is cleared. Maybe a middle-of-the-road policy might be better—to use a considerable amount of fuel oil during peace-time, when the cost of transport is low and the commodity can be bought at a cheap price. Then, when world conditions change and uncertainty takes the place of peace, we could use a considerable amount of our peat resources. I believe we would be driven into that position ultimately.

I should hate to think that we should be wedded to one particular Party because we are for turf and that we should be wedded to another political Party because we are against turf. That would not be looking at this very large and national problem in a straightforward way.

I should also like some information from the Minister on the state of development in this country of the gas turbine. The E.S.B. in the North of Scotland got that famous engineering firm in the Clyde Bank, John Brown and Company, to manufacture gas turbines. I understand that, for about half the cost, they would give a greater output of electricity than steam turbine generation. If we could generate 50 per cent. more electricity with the same amount of peat, naturally our peat bogs would last very much longer and the cost of production of our electricity would be very considerably reduced.

Another matter recently suggested is the development of a chemical industry based upon cheap electricity generated in isolated parts of the country where it would not be necessary to distribute this electricity over long distances, because the cost of our overhead distribution system and of supplies at long distances is a very heavy problem.

I will end this speech on the same note as I started by saying that this is such a large and important problem for the future of all of us that there should be a parliamentary committee of both Houses of the Oireachtas to supervise the legislation, examine the annual reports and go into the matter in a businesslike way. I believe that they would be able to help whatever Minister would, from time to time, be charged with the introduction of legislation to deal with this problem. They would act as a supervisory body to see that we were given service efficiently and that the national economic interest was being safeguarded.

Mr. Summerfield

I want to be among those who heartily congratulate the Minister and all concerned with the introduction of this scheme. I feel that nothing in our time has been more valuable to our general economy than the rapid development of a national electricity scheme. At the same time it is well to point out, as the Minister did, in his remarks here to-day, that this highly efficient board has two privileges—well, I will not say privileges—but it enjoys two fundamental things. The Minister stressed that the board is permitted to use its reserve funds for the "adequate provision of the replacement of wasting assets." The Minister by stating that pins his faith to the necessity for that and I heartily agree with him, and so does every other businessman in the country, but general business is not permitted to make that wise provision.

Mr. Baxter

Look at the tariffs they have.

Mr. Summerfield

I wish Senator Baxter would keep his mouth shut when another Senator is speaking. I do not resent criticism but I would like it to be informed and constructive. That is all I ask of Senator Baxter.

Another thing the E.S.B. is permitted to do is to fix its charges, and here again there is a big principle involved. It leads me to say this, that when there is a board of this kind with a capital now to be increased to £100,000,000—that board will be there and the scheme will be there when this Government and all of us here are no longer on this earth—it is necessary that the State itself, represented by the elected representatives of the people, shall have some control over the policy of a board of that magnitude. Even the fixing of charges is something that should not be left entirely to this board. It is competing here in the City of Dublin for instance with the publicly owned Gas Company which cannot raise its charges at all or increase its dividend without having to go through a very tedious process with a Department of State. This is fair criticism. In general, all of us are proud of the E.S.B. and what has been done to date. We are all delighted to see its extension into the remotest parts of the country and it is up to the people for whom this service is being provided to make it possible to give them speedier and cheaper services by coming wholeheartedly in and availing themselves of the scheme.

But the scheme has done a lot of good things that have not been mentioned in the short debate we have had to-day. Among these things, it has given very badly needed outlets—as Senator Hayes and others involved in university education will know—for many young university graduates who without some scheme like this would have to emigrate and give their services to other countries. Is it not amazing that we now have a permanent market for 3,000,000 tons of native turf? God was good to us when he gave us our turf banks. Because of them we are now in the position that through this one industry alone 3,000,000 tons of turf will now be necessary to feed electricity generating stations in this country.

I do not think that this Bill calls for any long or detailed speeches. I am delighted to hear that it was received by the other House with enthusiasm and left it in that atmosphere. I would like to feel that it would get the same treatment here and that we all wish God-speed to the board. The little criticisms that I made were intended to be helpful, when I said that its power to make provision for wasting assets should be extended to industry generally and should not be confined to this mammoth, the E.S.B.

Mr. O'Donnell

I would like to join with Senator Summerfield and other Senators in welcoming the Bill. It is the first evidence that I have seen on the part of a Government of willingness to hand back to private enterprise a successful public utility. I have neither seen nor known of any similar enterprise where such a proposition has been advanced in connection with its future development. I think it is advisable, and I think it is a worthy thing, that where under certain circumstances certain types of industries had to be established under Government auspices they should when they come to a particular stage of fruition, revert to private ownership. It does mean, of course, the issuing of shares in a public utility, and one question that does arise is: what was the reason for the change in the method of financing? The Minister told us what it was proposed to do, but he did not tell us why it was necessary to do it. Some years ago when industrialists complained about the price of power it was found on investigation that the E.S.B. was paying interest at the rate of 5½ per cent. on moneys lent to it from the Central Fund.

Money at that time was lendable generally through the banks at 5 per cent. but the E.S.B. was paying ½ per cent. extra. I would like to know at what rate the E.S.B. has been paying in recent years and if, as a result of this new method of finance, in its future extension it will be able to sell power at cheaper rates. It is absolutely imperative for the Minister as Minister for Industry and Commerce to see that power, above all things, would be sold at a very low rate if we are to develop our export trade. There is very little that industrialists can do about this because industry has no control itself over certain fundamental costs such as the cost of power. Even money costs are going to imperil the development of the export trade.

We should be very careful to see what is proposed to be done. It is proposed that £25,000,000 would be the extent of the new issue. Could not the Government itself, through some new method of finance, issue guarantees to the public without having to go through the ordinary channels to finance an undertaking of this nature? Why should the public be asked to subscribe now to an issue which will, presumably, be a trustee stock and which will, presumably, be issued at 4½ per cent., because I cannot see any other reason for the change? Why should the public be asked to provide finance at 4½ per cent. while the banks and other organisations are financing industry at 6 per cent.? I wonder would the Minister tell us what is the reason and the justification of the reason. I am not opposed at all to the change. I am just asking what the change-over is for. What is the purpose of it? In what way did the lending facilities of the Central Fund prove inadequate or in what way did they prove too expensive? Remember, I am not at all critical in any way of that development. I appreciate, as does—I am sure—every other member of the House what has been done and I congratulate the board and the Minister, and his predecessors, and all who contributed to the great national development of electricity here. But I am rather worried about this new method of finance. If it is a matter of transferring charges from Billy to Jack at public expense, then I am not in favour of it, if that is the only reason for it.

While we appreciate the necessity for developing power from bog sources, I wonder will the Minister tell us something about the life of our bog resources. I understand that persons associated with Bord na Móna and with the production of turf in this country assess the life of an average bog at 25 years, that at that point you come down to clay foundations. I am quite sure that a survey has been made of bog resources here and I wonder will the Minister tell us how long he can count on bog supplies and whether there was not some point in the argument made by some Senators that during times of peace it might be wise to import fuel oil and, taking the long view, preserve our bog supplies for times of crisis.

Will the Minister give us the comparative cost of production between electricity produced from bog sources and electricity produced from water sources and oil sources? It would be interesting to hear these comparative costs. While bog development has given great employment and workers have been getting a lot of work, I should like to know what extraordinary benefit has been created by electricity supplied from our turf resources.

Will the Minister tell us why reserves were used by the E.S.B. to offset the wasting assets? I understand that the E.S.B. also has profits. What did happen to the profits? Were the profits all expressed in terms of reserves? Will he tell us what percentage of capital investment has been paid off over the years, what percentage of profit the E.S.B. has been making and whether the increased charges are in his opinion a national advantage? It is assumed that as a result of the new method of assessment the E.S.B. will have a higher income. Senator Yeats wags his head. I have to be very careful because I have learned my lesson from hearing the Minister so often. I assume that what I say is correct in this case. If it is not correct, it can be answered in the negative. I should like to know what happend to the E.S.B.'s profits, if they have been handed back to the State or spent in the repayment of interest charges.

I do not agree with the statement made by Senator Baxter, supported by Senator Burke, as to the necessity for an overriding committee to control the E.S.B., any more than there should be an overriding committee to control any other industry in this country. We are hemmed in with all sorts of dictatorial powers of one sort or another whereby any company which is not efficient goes through a sort of crucible either in the Fair Trade Commission or the Prices Tribunal or the Department of Industry and Commerce, so that there should not be any necessity for an overriding committee to control the powers of the E.S.B. The Minister, I am sure, has sufficient power already to control the E.S.B.

Taking the long view, I am wondering if the Minister has given any thought to atomic and solar energy developments and what reactions they may have on the development proposed in this Bill. We already have evidence from two recent explosions with hydrogen bombs that new forms of energy are being created every day and that, in fact, forms of energy are now being created which are probably getting out of control. In the course of time, it is possible that our scientists here may discover some method of adapting the present methods of atomic energy for the purpose of creating power and light. That is not a fairy tale, it is quite an ordinary possibility of commerce that power and light may come to this country inside ten years in forms of atomic or solar energy.

Finally, I would ask the Minister my crucial question: why is there this change in the method of financing; what is the necessity for it? I should like to ask him if it will have any effect on costs, as this will affect power charges mostly, and what reaction it will have on the goods made. Anything I have said has not been said in any carping spirit. It is only a case of inquiring, because I appreciate the great work being done by the E.S.B. in the development of electricity in this country.

Mr. Quirke

I should like to join with the various Senators who have expressed the feeling that they would like to congratulate the Minister. Personally, I feel that throwing any bouquets at the Minister would be like carting turf to Curraun or some place like that. The record of the Minister as far as the turf industry or the E.S.B. or any other industry is concerned is well known. The only thing I am amazed at is the ignorance of certain Senators who have spoken as far as the turf industry is concerned. Notwithstanding all the speeches which have been made, all the articles and all, the books which have been published on one thing or another, there are still people who apparently do not know the first thing about one of the most important industries in the country.

I was amazed to hear Senator Burke, for instance, talking about the turf industry and pretending he knew something about it. He talked about how important it was that all the pros and cons should, be carefully examined before we would embark on any extensive scheme as far as turf development is concerned. He went on to say that it was serious to realise in connection with the production of milled turf that 5,000 or 8,000 people might be collected around a certain area and that the mill might close down in 25 years, which he understood was the life of a bog. It is a terrible state of affairs to think that anybody who has any interest in the turf industry or any other industry in this country would not know that the production of milled turf has nothing whatever to do with mills; and that the term "milled turf" means turf harvested in a particular way and that the fact that it is harvested in this way makes it suitable for use in the development of electricity.

It would be much better, before some of these people go to the country and make speeches criticising the turf industry, that they should read something about it and be in a position to talk sensibly and not talk about the white elephant that will be left after the bog has been used for 25 years. Some of those in what we might call the Opposition in a non-political House said that the life of a bog is 25 years. If the life of a bog depended upon the activities of a Coalition Government or a Fine Gael Government, it would be 25,000,000 years, because they would not have done anything. Every time the question of the development of bogs arose, whether it was a question of drainage or of building roads into bogs in order to develop the turf industry, or whether it was a question of hand-won turf or milled turf or machine-won turf or briquettes, it was opposed tooth and nail by the people who formed the Coalition Government in the past. They come along to-day, and while they do not want to admit that they were wrong over the years they want to warn the possible Government—knowing very well that it will be a Fianna Fáil Government and that the present Minister will be still in charge of turf development in this country after the general election——

Mr. Baxter

You are an optimist.

Mr. Quirke

It is better to build castles in the air than dungeons in the air as you have been building all your life anyhow. They want to warn us of the dangers of this thing, and the dangers of the position that there will be when the turf is cut away. Surely anybody in his sane senses knows that the life of a bog depends on the number of machines working on it or the number of people working on it as individuals. If, as I said before, the policy of the other party were to be put in operation the question of the life of the bog would not arise.

Senator Burke with an air of super-intelligence suggested that we should purchase a lot of fuel oil. I wonder does anybody on the other side of the House know the amount of fuel oil which would be necessary to take the place of the turf now being produced. I say, by all means, purchase and store all the fuel oil that can possibly be purchased and stored, not to take the place of turf but to ensure that the machines run by fuel oil for the production of turf would be able to continue in action over a possible period of war or emergency in this country.

I believe that the question of experimental work on turf is only in its initial stages, and I believe that anybody in his sane senses will now realise, regardless of what he said in the past—we heard people saying that they would not be found in a bog hole, and that we were throwing the people's money into the bogs—that they made a mistake. They should realise that they were wrong. It takes a good fellow to admit that he was wrong. Admit that you were wrong over the years, that a good job was done in the development of turf and that you are prepared now to row in with the people who knew all the time that turf was one of the most important industries of this country.

I believe that experimental work on turf is only in its infancy. If we are going to ensure the safety of this country in the event of an emergency or the outbreak of another world war we will have to get down to the stage where we will be able to ensure eventually that even a considerable amount of our transport which has not been used before under the power of turf will be adapted to use either by vehicles used directly by turf fuel or by electricity developed as a result of the development of the bogs of this country.

Mr. S.T. Ruane

I think I am quite correct in stating that any Bill or measure introduced here that has for its objective or design to extend or develop the hydro-electric scheme of this country will meet with a very sympathetic and helpful hearing. That is as it should be, for no other State-sponsored scheme, as has been pointed out by many speakers, has been so successfully administered or brought so many benefits to the people of this country as the Shannon hydro-electric scheme has. The benefits are many and far flung, and they have been responsible for converting those who in the initial stages were very obstructively critical of the efforts made and the idea of having hydro-electric power developed in this country from the most pessimistic to the most enthusiastic about the extension of the benefits at the present time. The greatest credit is due to the administrative staffs and to the technicians employed in extending the benefits of this scheme to the country; and that credit goes out also to those engaged on the actual labour, for I know no body of public workers in this country that works so regularly and so hard as those engaged in extending rural electrification to the remote districts.

If I have any criticism to offer to this Bill it is due to the vast amount of money that is being borrowed, but of course it is necessary to bring about the developments that the Bill is designed to achieve. That money, of course, has to be borrowed at a high rate of interest. It has been represented in many quarters that the profits earned by this service are largely going to the paying off of interest and that something should be done with those profits to reduce the capital debt. I am not going to go into that. I certainly welcome this Bill, and I trust that the areas so far deprived of the many benefits that rural electrification can bring about will soon have the benefits which the Bill is designed to give.

Mr. Hawkins

Having heard the remarks of the opening speaker on the Opposition Benches, Senator Baxter, one would be inclined to believe that many of us were opposed to the development of electricity supply, particularly because of a reference to the development of the Shannon scheme. If Senator Baxter or his colleagues wish to take us back to those days in which proposals were placed before this and the other House in relation to the establishment of what was then known as the Shannon Scheme Development Electricity Board, we perhaps could convince him now that the proposals contained in that Bill would not be accepted by those people but would be accepted by us now as being persons who were in a position to give very responsible advice on a proposition and a suggestion of that kind. When Senator Baxter and those others associated with him suggest that the development of this country started with the inauguration of the Shannon development scheme, one must examine these proposals in relation to the difficulties in which they now present themselves. Senator Baxter is a member and a representative of the farming community in this House, and as such he would like to present himself, and I am sure that when he examines the difficulties that have been created by the inauguration of this particular scheme and the impediments it has created in the further development of arterial drainage development of the country he will not be as enthusiastic as he might have been otherwise in putting forward the Shannon development scheme as the first. I will admit that it was the first, and the only scheme that was put forward by the then Cumann na nGaedheal Party; but it was then put forward against the advice of the most learned and the people who have given the most thought to the difficulties that it might have created; and if statements were made at that time that this scheme was not one that should have been accepted by the people, I think Senator Baxter and those people associated with him will agree with me now that if that scheme was put forward as a serious scheme to-day it would not be accepted either in this or in any other House of an Irish Parliament.

Be that as it may, it is there now and there is very little we can do about it. It has created very serious difficulties not alone for the further development of electricity in this country but also for the great national scheme of arterial drainage. It has created difficulties in another very important sphere of national development —our sea fisheries development. I think that these are two facts which, if presented to any Irish Parliament as they should be, would prevent that Parliament from accepting the proposals that were put forward by the then Minister for Industry and Commerce in connection with the development of the Shannon.

We have seen that it has been necessary in order to supply all the demands that have been made over a number of years for power and light, to undertake a number of other schemes. One of the reasons that I have intervened in this debate is to tell the Minister that we in Galway, particularly in Connemara, appreciate very much the decision that has been arrived at to erect a generating station in that area. We have heard a considerable amount from every Party in the State as to what should, and should not, be done in the Gaeltacht. In the Connemara area we have very little to offer except a very vast amount of bog. I think that even members of the Opposition will agree with me that it is about time we brought before the people the possibility of the development of this area. So far back as 1932, we caused to be passed through the Oireachtas a Bill known as the Turf Development Bill in which facilities were provided to assist our people to develop the resources at their disposal. Here we have something even more important to our people. As I stated, although we have very limited natural resources in Connemara there is a vast area of bog there. There is no other source of employment, apart from the seasonal employment derived from tourists who come to see the scenery with which God has blessed us.

Employment must be found by the development of the resources that are there—the development of the bogs. Here we have a proposal to utilise these resources in providing power and light. In providing that power and light we are doing something more. We are providing an incentive to people to come in and build factories and to do the things that hitherto have been done in Dublin and elsewhere. I hold that that is one of the biggest possibilities held out by this Bill.

I think it was my friend, Senator O'Donnell, who also comes from Galway, who asked the question why we are now placing, as it were, the resources of the E.S.B. on the market, why we are asking people who have money to come forward and invest their capital in the development of something that means much more than any Act we could pass here because that, in the last analysis, is what it does mean. Hitherto, since the E.S.B. was first established, the Government provided all the funds necessary for the development of the various schemes undertaken by the board, but an effort is now being made to induce our people to provide the capital necessary for further development in rural Ireland. The sum involved is, no doubt, big; that is a matter that can be debated further when the Estimate comes before this or the other House, but it is very necessary that it should be made available because it is proposed to give to the people of rural Ireland, at least, some of the facilities hitherto enjoyed by their sisters in the towns. I say "sisters" because it is the womenfolk mainly who have had to endure the day-to-day drudgery of household work in rural Ireland. It is hoped that the facilities provided under this Bill will considerably lessen that drudgery.

I think it was Senator Baxter who asked why the same thing could not be done in Connemara as has been done in Gowla bog. I have known Senator Baxter for quite a number of years. I first met him when he was leader of the Farmers' Party, more years ago than I should like to recall now. I always like to associate Senator Baxter at least with a little bit of common sense, but when he tries to equate the conditions in Gowla bog, with which Senator O'Donnell has more intimate associations than I have, with those of Connemara, Senator Baxter shows that he knows very little about the particular proposition of which he speaks, to say the least of it. I should like to pay tribute to the manager of the Irish Sugar Company, General Costello, for the enthusiasm, direction and energy which he has displayed in taking over the Gowla bog.

There is no Gowla bog area in West Connemara and there is nothing we can offer to these people except what we have offered—the development of the handown turf scheme and the tomato and these other schemes. There is nothing else we can do for these people, except migrate them to the richer lands of Meath and these lands are not there available for them.

Mr. Lemass

Senator Baxter said he had some grave doubts about the policy being pursued in this matter of electricity development and urged that an all-Party committee should be established to review the position in a fundamental way. Personally, I do not think that would do any good. We are committed now to a ten-year programme which is based upon the policy of utilising native resources exclusively. The only problem that faces the technicians of the E.S.B. at present is how best to complete that programme in the least expensive and most efficient way. I do not think there is anything to be gained by diverting their minds to the consideration of the economics of utilising fuel oil, coal or any other alternative fuel. In my experience it was necessary to make it clear to the board that there was no alternative to working on native resources in order to get them down to the tasks of solving the technical problems associated with the implementation of that policy.

Senator Burke said we should inquire as to the cost of industrial power in other countries as compared with this country. I am sure that somebody can give him that information but why should we seek it? What happens if we find, as we probably would find, that the Swiss and the Swedes have electricity much cheaper than we have it? Do we then call the whole thing off? I do not understand that mentality. We have resources here such as they are. We have men with the technical knowledge capable of making the best use of the resources we have and that is as much as we can do—make the best use of these resources—and that is the policy we are going to pursue and we do not want an all-Party committee to complicate it.

Senator Baxter need not be so perturbed about the cost of electricity produced here or the possibility of consumers not wishing to take electricity at that cost. On that point, I may say that the trouble has been that consumers wanted more electricity than the E.S.B. were able to supply and in fact the whole programme of the board had to be sharply stepped up to ensure that they would always be one step ahead of the growth in demand and I think we are still a long way from the date upon which the E.S.B. will be sending out its commercial travellers to sell electricity and to cultivate the market which is undoubtedly there, because, as I have already pointed out, the consumption of electricity per head of population in this country is one of the lowest in Europe.

So far as costs are concerned, Senator Yeats did less than justice to the E.S.B. He said that current costs only 50 per cent. more than it was before the war. The average price in pence secured per unit sold in 1953 was only 28 per cent. higher than it was in 1939 and it may solve all problems for Senator Baxter if I tell him that in 1953 the E.S.B. sold current at a lower price per unit than that at which they sold it in 1930, 1931 or 1932.

I tell Senator Summerfield straight away that the E.S.B. pays income-tax on exactly the same basis as a private producer and the accumulation of reserve funds for depreciation of wasting assets is not a tax provision. It is a statutory obligation which the board have to fulfil for the benefit of future generations of Irishmen.

Senator O'Donnell is completely wrong when he describes the Bill as a device for handing over the E.S.B. to private enterprise. I tried to make it quite clear that the sale of securities by the E.S.B. will not carry with it any power of controlling the undertaking. The whole undertaking will still be controlled by the board, the members of which will be appointed by the Government and private enterprise will have nothing whatever to do with the administration of the undertaking. Private citizens will be given an opportunity of investing in E.S.B. stocks and the inducement to them to invest will be the security they are offered and the rate of interest attaching to it.

Mr. O'Donnell

They are getting their foot inside the door.

Mr. Lemass

No, not even a finger, so far as control is concerned. It is just as well that that should be quite clear. There is nothing in the Bill which involves any alteration in the system of control and if Senator O'Donnell buys up the whole first £25,000,000 issue of stock, he will have no more right to go into the head offices of the E.S.B. than he has at the moment.

Why are we giving the E.S.B. this power of going to the market for their capital needs? There are a number of reasons. It is the normal method of financing national development projects of that kind in other countries. In this country, we could not resort to the normal method because of the lack of an investment tradition amongst our people. We have succeeded in building up some sort of investment tradition now and we think it is possible now to do what would have been the normal thing earlier and let the E.S.B. go to the capital market for money as they require it. It is possible, and I think probable that they will be able to raise money through the issue of their own stocks at a slightly lower rate than they obtain it at present from the Exchequer. The Exchequer charges the E.S.B. administration expenses and I think up to the present has made a slight profit on the reissuing to the E.S.B. of money which it has borrowed from the public.

Furthermore, the State's obligation in respect of national development, the very big investment programme on which we are embarking, is creating undoubted problems. Every year, the State has to go to the public for a national loan and is not always able to get, through such loans, the amount it requires for the national development programme in which it is engaging. Not all the money available for investment can be attracted into Government stocks and we think there will be an addition to the total investment in national development, if the State is released from the obligation of financing the E.S.B. and the board is allowed to go to the capital market in its own way; in other words, we think there are investors who will invest in an E.S.B. issue who will not be attracted by a Government issue. Logic does not always apply in these matters, and, even on a logical basis, there would be a reason to expect that result.

We have not had an actuarial survey of the life of a bog, but we have an engineering survey which we thought would be more appropriate. The life of a bog depends on three factors—the area of the bog, its depth and the rate at which you exploit it.

Mr. O'Donnell

That has already been stated by somebody, but that is not what people have in mind when they talk about the life of a bog.

Mr. Lemass

Most bogs have been there for 2,000,000 years and probably, as Senator Quirke said, will probably be there for another 2,000,000 years, unless somebody does something about it. What the Senator has in mind is the number of years for which, at the present rate of development, these bogs will provide fuel before being worked out. In the case of the bogs now being developed in relation to power stations, for the provision of power for these stations, the aim is to keep the bog in immediate production of fuel so long as the station will last without replacement, which is roughly 20 to 25 years. There is a whole lot of other bogs not being worked at the moment at all. I am quite sure that by the end of 20 or 25 years the research department of Bord na Móna will have devised a technique for exploiting the resurces of blanket, mountain and other bogs which cannot be worked by their present methods and which represent the largest area of bog in the country.

An Leas-Chathaoirleach

The tea interval is at 6 o'clock.

Mr. Lemass

I have only two other matters to refer to.

Mr. O'Donnell

I think we should let the Minister finish. I should like to hear something about the use of atomic energy for power purposes.

Mr. Lemass

The board does not make a profit. It is barred by statute. Its obligation in law is to so frame its charges that its income in any year will equate to its outgoings in regard to administration, capital liability and reserve appropriations. Some years they had a surplus on revenue account and in other years a deficit, but by and large there is no profit. If the board has a surplus in any year it appropriates that surplus to the various reserve funds.

So far as the development of atomic energy for power purposes is concerned that is obviously a technical problem. The British Electricity Authority is establishing a station in the North of Scotland to utilise atomic energy. That is being watched with interest. The indications are that it is not the most economic method of developing power at present. I am quite certain that technical improvements will result and that it would be advisable for us to contemplate the utilisation of atomic energy for power purposes at some time in the future. We are dealing now only with the ten-year programme that will keep the E.S.B. in the position to meet the electricity needs of this country up to 1961. As I pointed out when bringing the Bill to the Dáil, long before 1961 the next ten-year programme will have to be considered and the necessary plans made for it.

I should not like to be taken as agreeing with all that Senator Hawkins said so far as the Shannon scheme is concerned, particularly when I am bringing in a Bill which proposes to develop a number of other rivers for power purposes in a way which we hope will avoid all the drainage and other problems which result from efforts to harness water power.

We recently brought into production the Erne scheme which is slightly bigger than the Shannon scheme in actual output capacity. It involved more political problems than those which arose in connection with the Shannon scheme. We are working on the Lee River scheme, and other rivers are capable of being developed for power purposes. From the point of view of the unit cost of production water-power is the cheapest source available to us. Once the capital expenditure on a hydro-power station is completed there is very little further expenditure. The day-to-day operation charges are negligible. The Shannon scheme is operated with a very small staff.

There are very considerable advantages in getting power from turf stations even if, while the capital costs are lower, the operational costs are higher. It means employment for thousands of people. New stations are being erected in Mayo and the total investment, making allowance for the changes in the value of money, will be less than in the Shannon scheme, but the total output will be greater than from the Shannon scheme. Immense benefits are conferred on the whole area in the form of permanent employment for many hundreds of workers.

It is not necessary to make a contrast with one form of development as against another. Both are necessary. There is no form of development which is better to associate with waterpower development than turf development. When you have plenty of water you have difficulty in getting turf in a wet year, but in a dry year the turf should be easy to win. There is a natural association between one type of development and another and that is an argument I have been using in favour of turf all the time.

Question put and agreed to.

An Leas-Chathaoirleach

When is it proposed to take the next stage?

Mr. Hawkins

Now.

Professor Hayes

Not now. Let us take it next week.

A Senator

Budget week.

Business suspended at 6.10 p.m. until 7.15 p.m.

Seanad Éireann debate - Wednesday, 7 Apr 1954