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Seanad Éireann debate -
Wednesday, 22 May 1957

Vol. 48 No. 1

Imposition of Duties Bill, 1957 ( Certified Money Bill) — Second Stage.

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

I think new members of this House may not object to find that the first Bill submitted for their consideration is one of comparatively minor importance. This is a Bill which is designed to make some changes of no very great significance in the Emergency (Imposition of Duties) Act, 1932. It was felt it would be more convenient for those who might have occasion to refer to the Act to repeal the whole of the Act of 1932 and to re-enact it with these changes in it. That explains why the Bill contains a number of provisions. It will be appreciated, however, that these provisions are already there in the existing Imposition of Duties Act and are only reproduced here because that Act is being repealed and it is felt desirable to have one Act embodying all the contemplated provisions.

The Bill had its origin in the situation which is contemplated when the Supplies and Services Act ceases to operate at the end of the year. As former members of this House will know, a number of measures have been brought along from time to time to continue in permanent form certain powers which were previously exercised under the Supplies and Services Act and which it is desired to retain. One of the matters which came up for consideration in that connection was the fact that, by Order, under the Supplies and Services Act a number of customs duties imposed by Finance Acts had been suspended and remained suspended and it is desired to keep them suspended for the time being.

The Emergency (Imposition of Duties) Act, 1932, contained a provision for the revocation or suspension of duties imposed by Order under that Act. Prior to its enactment a number of customs duties were imposed in annual Finance Acts and no power to revoke or suspend these duties was taken in the Emergency (Imposition of Duties) Act—and that power was exercisable only by Order under the Supplies and Services Act.

It will be recollected that practically all the customs duties which were in operation here before the war were suspended during the war. Some of them remain suspended still. It is not desired, however, to repeal them completely because, although the firms to assist which these duties were imposed have been able to carry on without them, they attribute their ability to do that to the knowledge that the duties which are there can be brought into operation again by Order if circumstances should require it. By keeping these duties in suspension, and not revoking them, a number of problems of definition and scope are also avoided. That is the main reason why this Bill appears at this time. However, as a Bill to amend the Emergency (Imposition of Duties) Act was necessary, it was decided also to make certain minor changes in that Act which I think the House will welcome.

One of the provisions of the Emergency (Imposition of Duties) Act, 1932, requires that Orders made by the Government imposing or amending duties or customs must be confirmed by legislation passed through both Houses of the Oireachtas within a period of eight months. The making of Orders of that kind is more or less a continuous process. Experience has shown that it is always necessary to bring along a Bill to confirm Orders with some haste towards the end of a Dáil session. It will be calculated that some Order which had been made previously is due to expire under that eight months' rule within the period of the recess and, consequently, that a Bill is necessary to confirm it, and it is always found difficult to fit that Bill into the parliamentary programme coming to the end of a session and generally it results in very little time being given to either House of the Oireachtas to consider it fully.

The new arrangement proposed is that Orders made in one year will be confirmed by legislation in the next calendar year. That arrangement, while maintaining the power of the Oireachtas to refuse to confirm Orders, facilitates the fitting of the necessary legislation into the programme and the giving of adequate time to each House of the Oireachtas to consider the Bill without restraint.

I mentioned already that customs duties imposed under a Finance Act cannot be revoked by an Order under the Emergency (Imposition of Duties) Act. That was an oversight in the drafting of that Act and it is being amended here. These are the only changes made in the Act which has been in operation since 1932, except for one other, which is of no very great importance either. The Act was called the Emergency (Imposition of Duties) Act. As it has lasted for 20 years, it has now been decided to call it the Imposition of Duties Act.

Everybody welcomes this Bill because there has been a long-felt need for it. The Minister described it in the Dáil as a machinery Bill, which is the best description of it. It is very acceptable because it at last provides permanent legislation in place of the temporary legislation that had to come up here year after year in an ad hoc manner for the confirmation of Orders. There were constant complaints in this House against the system and there was a call for a revision. I am glad to say this revision has now come. Because of the terms of the existing legislation, it meant that this House particularly was always being asked to pass Bills in a very great hurry. We were always being told by whatever Government was in power that the Bill “must go through to-night” or there would be great diffculty caused all round. Consequently, we found ourselves in the position of having to pass these Bills very often with only cursory examination of them. For that reason, we all welcome this legislation.

The proposal now is that the duties and the Orders in any year will be confirmed in the next calendar year. We agree also with the power, now given to the Government, to revoke customs duties imposed by the Finance Act. This was not possible up to now. This gives the Minister freedom to act. There may be a certain amount of apprehension in giving a Government power to revoke by Order statutory provisions, but I think anybody who realise the amount of work that has to be done by a Minister and Government nowadays will agree that it is reasonable to give a Minister power to act quickly.

The imposition of duties, the protection of industry and, perhaps, the allowing in of goods at a special time and not allowing them in at other times, are all decisions that have to be made very quickly and promptly, and it is only right that the Government should have the power to make Orders that can be carried out quickly and expeditiously. On the other hand, there is provision in this legislation for supervision by the Oireachtas in that, I understand, these Orders must come before the Oireachtas for confirmation.

The Minister did not mention it in this House, but he mentioned in the other House that the purpose of this Bill was to protect and help Irish industries and, not only to protect the industries themselves, but to safeguard the community in certain cases. I should like to say a word about this. We all hope the machinery being created in this Bill will not be used in the future—and I am sure it will not —either to encourage inefficiency or to hinder efficiency in industry generally, but rather will be used to encourage industry here and particularly to encourage efficiency in industry. We can no longer put up with inefficiency in this country. Irish industry generally has been given a fair crack of the whip. It must be efficient, up to date and competitive. We all realise that, in the present situation, there is no longer any room for inefficiency in our industrial life.

Our trouble here is that our market is so very small. That is the real reason for the machinery being set up in this Bill. The market is so small that Irish industries must be protected. At the same time, it is realised by all of us that the market in this country, with only 3,500,000 people, is not big enough to give us an industrial economy that will employ our people. Therefore, we simply must expand our markets and in that way we must export to other countries, if we are to have industries here big enough to keep our people employed at home and thus avoid emigration.

I feel it is absolutely essential that we join the Free Trade Area. That being so, efficiency will be all the more important. We can sell our goods abroad only if we are efficient. That means making much more use of machinery, modern methods and the employment of our labour force here. That will involve all sections of the Irish industrial economy giving of their best, giving good value for money and, above all, being efficient. This may be slightly outside the actual scope of the Bill, but I wanted to say those few words concerning industry.

As I said, we support the Bill. Everybody supports the Bill as a practical means of handling the imposition, variation and termination of duties. The Bill is very welcome and I am glad it has been brought before us to-day.

I wish to welcome this Bill because it carries out the policy of previous Government in protecting Irish industry. However, I should like to see in the future some emphasis on what I might term the fostering of Irish industry. Up to the present, the approach has been rather negative in erecting customs barriers to defend a local industry, while at the same time not doing enough to foster in the public mind the benefits of buying Irish goods. Unfortunately, because of the advertising of foreign products in the glossy magazines that get in, there is a tendency amongst the public to imagine that foreign goods are inevitably of a better standard and quality than the home manufactured items. In certain industries lately, the experience has been that, in fact, the home manufactured item is superior to the foreign product.

We have been and we are spending money on encouraging savings. This Bill has nothing to do with savings, except in the sense of saving nationally, of saving on imports. I should like to see a more positive effort made to have that saving on imported goods, perhaps through a campaign fostered by the Government in co-operation with the manufacturers and the trade union movements to promote Irish products. We must educate our people to the advantages to themselves and their children of buying the home product wherever possible.

Provision is also made in the Bill for the Government making certain temporary amendments. My attention has been drawn to the fact that the customs apply a certain duty on imported articles. What I have in mind are diaries used by the medical profession and diaries used by certain trade unions. This is good and right in a general sense, but it can lose its effect in particular instances. In these two instances, the effect has been that the imported diaries are simply cut out altogether. They cannot be manufactured here at any economic price at all. They are distributed, I suppose, more for advertising value than for anything else, and, because of the imposition of the heavy customs duty, they are not imported. The medical profession or the trade unions concerned have had to decide that they cannot be brought in. I think the Minister is right in taking the power to review certain customs duties like that, and I would ask him to exercise that power to review that duty, which serves no good purpose and keeps out material which is valuable to the profession or the trade unions concerned.

I should like to welcome this Bill from the point of view which was put by the Minister in introducing it, that is to say, that it improves the mechanics whereby duties can be imposed, makes the machinery more smooth, and, at least in several cases, more explicit. On the whole, therefore, we are all agreed that it is a good Bill and one to be welcomed, and that it represents the kind of clearing up and consolidating legislation which improves the Statute Book.

I should like to agree with Senator McGuire in two things he said—one in relation to the standard of efficiency behind the tariff wall among our manufacturers, and secondly, the necessity to look forward towards entry into the European market and to consider whether with the imposition of too heavy duties, we may be unfitting ourselves to participate in or to calculate on entering any such scheme. When, in other words, under such a Bill as this, new duties are being imposed, I should like the Minister to consider very carefully the rate of duty, and whether a heavy rate of duty is really necessary or not, and whether it might not be possible, as I have suggested before, particularly in relation to new industry, to introduce some kind of process whereby the protective duty would be on a diminishing scale down the years, in the belief that the early years are more difficult for any new industry, and that they might consequently require a higher rate of duty during those early years.

I noticed in recent weeks several new duties imposed. I noticed, for instance, a duty of 6/- each on men's shirts of value not exceeding 8/-. That is a 75 per cent. duty on very cheap men's shirts. I cite that as one example. A similar example is a duty of 4/- each on boys' shirts not exceeding 5/- in value—an even higher percentage on a very cheap shirt. Is the Minister sufficiently considering whether those rates of duties are not too high, and whether in fact such duties are not putting too heavy a burden on the poorer sections of our community?

Similarly, I think I am right in saying that a fresh duty on powered farm-machinery of certain kinds was introduced the other day at the rate of 37½ per cent. On previous occasions, I have tried in the Seanad without getting much support to question that kind of duty, because I regarded it as an impost on the farming community for the benefit of the manufacturing community. While we all recognise that the manufacturing community requires, in our special circumstances, some protection, it is very dangerous to give them over-protection, both because, as Senator McGuire suggested, their efficiency may not be as high in those circumstances as it would otherwise be, and because at some future day we shall have to be competing more actively with European competitors.

I should like to ask the Minister one or two questions which arise on the Bill, probably more from the fact that I may not have fully grasped the implications than from any lack of clarity in the Bill. The first question I should like to ask is in relation to paragraph (d) of Section 1, which refers to the imposition of duty upon an object which requires the "taking out of a licence for the doing of any particular thing." I am not quite sure whether that gives the Minister power to impose a duty and to require that a licence for import be required. "The doing of any particular thing," I suppose, includes the importing of some article? There is reference in Section 3 to the importation of goods by licence, and that may be the sort of thing that is referred to under paragraph (d) of Section 1.

The reason I ask this is that I have felt in the past that there is a danger implicit in giving power to the Minister to place a duty upon an article and then allowing certain people to import that article duty free in certain circumstances. I believe that I am right in saying that that is evident in relation to the wireless trade—the imposition of a duty on certain component parts. I understand that some importers have a licence under some such section as this to import free of duty. That leads, I believe, to a position of privilege for certain members of such trades. I am not suggesting that it is necessarily abused, but I am suggesting that it is capable of abuse, and I am not sure that it is a good principle to say that, where certain goods are subject to duty, we will make an exception for certain people. I can see the case being made for the exemption of certain goods from the application of the duty, but to say that we will make an exception for certain people seems to me to be a most dangerous thing.

The second point I should like to raise is in connection with sub-section (1) of Section 2. There are two points here. One is that I notice that every Order under Section 1 shall have statutory effect, and so on, unless the Order "is confirmed by Act of the Oireachtas passed not later than the end of the year following" and so on. The Minister made the point that under the provisions of the 1932 Act the confirmation by Act of the Oireachtas had to be within eight months. The term under Section 2 of the 1932 Act is that it must be confirmed within eight months "after the making thereof", not after the end of the year during which it is made, as here.

This new section and sub-section could make rather more of a difference than has so far been adverted to, because if those Orders have to be confirmed not later than the end of the year following that in which the Orders are made, they may not be confirmed for 23 months instead of eight months. If I am correct, if an Order is made in January of one year, it does not have to be confirmed until the end of the following year, some 23 months later, so that the change being made is not a change from eight months to a year but from eight months to possibly 23 months. I wonder has the Minister fully realised that, and does he see justification for quite such a long period before an Order of this kind has to be confirmed?

Again, I am not sure that I am right, but it does seem to me that this section implies that an Order made under Section 1 "merely revoking wholly an Order previously made under that section" does not have to be confirmed at all by the Oireachtas.

In the debate in the other House, as reported in Volume 161, column 1341, for 15th May, 1957, Deputy Cosgrave asked the Minister if, when an Order is made revoking a customs duty, that Order has to be brought before the House; and the Minister replied "Yes." As I read this particular sub-section, it seems to me that the answer is "No," because this sub-section says that an Order has to be "either" confirmed by an Act "or revoked wholly" by an Order under this section, I do not see anywhere in this Bill any mandatory suggestion that a revoking Order must be put before the Oireachtas. That may be because I am not reading it correctly, and I ask the question for clarification. Is it necessary, as the Minister said in the Dáil, for a revoking Order to be passed by the Oireachtas or to be brought before the House?

The next point on which I would like information is in regard to sub-section (2) of this same Section 2, which has in fact precisely the same wording as the equivalent section of the 1932 Act. What it says is that no Order under Section 1 which ceases, and so on,

"or which is revoked by Order under section, shall be capable of being continued or renewed by any other Order made."

As I read that, it means that if an Order under Section 1 is revoked by Order, never again in the history of the country can such an Order be reintroduced. I wonder if that is intended, and, if so, why it has to be so strong? I could imagine a case where a duty is imposed upon an article, and circumstances arise in which it was a good thing for a period of years to revoke that duty, and where circumstances might arise again in which it would be a good thing to put that duty on again.

I may be misreading that sub-section, but it seems to me that it prohibits the Minister from ever putting on again a duty once it has been revoked. It says that "no Order under Section 1 which is revoked by Order under Section 1 shall be capable of being continued or renewed by any other Order made under that section."

One final question which I should like to ask is in relation to Section 4. Section 4 deals with the laying of these statutory Orders before the Houses of the Oireachtas. It says:

"Every Order under Section 3 shall be laid before each House of the Oireachtas as soon as may be after it is made and, if a resolution is passed by either House within the next 21 days upon which that House has sat after the Order has been laid before it annulling the Order, the Order shall be annulled accordingly but without prejudice to the validity of anything previously done thereunder."

The question I want to ask is why this section refers only to Orders made under Section 3. Why should it not refer also to Orders made under Section 1? It seems to me that the major Orders in this Bill are those made under Section 1. Orders of relatively minor importance are made under Section 3, but it is only those Orders which by statute must be laid before the Houses of the Oireachtas and which the Houses of the Oireachtas apparently shall have the power to annul.

It may be that under some other Act it is necessary for Orders made under Section 1 to be laid before the Houses of the Oireachtas, but I am a bit puzzled as to the framing of this Section 4, and the fact that it refers only to Orders under Section 3.

I should be grateful to the Minister if he would clarify those points when he is replying.

Senator McGuire mentioned that in the Dáil I described this Bill as a machinery Bill. By that definition, I meant to imply that it dealt only with administrative matters and did not embody in it any policy decision of any kind. I did not, therefore, anticipate that any matters of general policy would arise in the discussion on it and I think that, in so far as it may be desired here to debate such matters, other and more appropriate occasions will present themselves.

There is no doubt that the whole question of industrial development policy is now open for reconsideration and that the course of events during the next four months will necessitate examination in the Oireachtas of its future course. It is possible that some proposals for legislation will be submitted which will facilitate such a discussion.

With regard to the specific points concerning the Bill which have been raised, I think that they are to some extent based upon a misinterpretation of its provisions. Perhaps it would be well if I dealt with them specifically. So far as paragraph (d) of Section 1 is concerned, the reference there is to an excise duty. It relates to the imposition of an excise duty, not a customs duty, upon articles, or the taking out of a licence. That would apply, for example, to a dog licence. It relates to the powers of imposition of a charge on a licence for the doing of something, as is customary and has been, for a long time past, the practice in relation to a number of activities.

That section does not refer to the granting of licences to importers to bring in goods free of customs duty. That power of granting licences for duty free importation of commodities is, of course, exercisable in respect of most customs duties. It is a device which was adopted originally, I think, for the purpose of dealing with the transition stage following the commencement of a new form of manufacture here under the protection of a tariff. There frequently was a period during which the extent of manufacture here was not sufficient to enable the full requirements of the home market to be met and the home output had to be supplemented by limited imports for a time. A duty free licensing provision was used to facilitate that.

Occasionally it has happened that difficulties of definition have arisen which made it impossible to apply a duty precisely to the type of goods it was intended that it should catch and the power of granting duty free licences was used to surmount that difficulty. It is not the practice to grant licences, for the importation of goods, to firms engaged in the manufacture of the same goods. Licences are granted usually to persons who are traders or users of the goods and who find themselves unable to get the commodities they require, in the quantity they need them or the specific quality they demand, from home sources.

It is, of course, true that an Order made by the Government imposing a duty of customs need not, or may not, under the terms of this Bill come before the Oireachtas for confirmation for quite a long period. The intention is to get out of the position in which the Confirmation Bills had to be rushed along towards the end of parliamentary sessions with little time for their examination. I do not think it is a very serious point. I have been Minister for Industry and Commerce for the best part of 20 years and I suppose I am responsible for most of the Orders made under the original 1932 Act and I do not remember a single case in which the Oireachtas refused confirmation of an Order. Nevertheless, it is important to continue that confirmation requirement, because it is through the discussion of the policy of the Government, as represented by the Orders made by it, that the Oireachtas is given power to direct the course of events and to exercise its right to attempt to influence the decisions of the Government.

As regards the power to revoke an Order and the question whether a revocation Order requires to be confirmed, there may possibly have been some misunderstanding in the Dáil in that regard. An Order made by the Government revoking a duty imposed under the Imposition of Duties Act need not be confirmed by the Oireachtas, but if the Government makes an Order revoking a duty of customs imposed by a Finance Act, that Order has to have confirmation.

With regard to the provision which stipulates that if an Order is not confirmed either because the confirmation legislation was not submitted to the Oireachtas or passed by it, or because the Government revoked the Order, then a similar Order cannot be made again, that is to prevent the possibility of a Government evading its responsiblity. In order to make the power of the Oireachtas over the Orders effective, it is necessary to stipulate that an Order made by the Government and revoked by it cannot be made by the Government again. If such a customs duty was needed, special legislation would have to be submitted to the Oireachtas in order to make it effective.

The power set out in Section 4 to the Houses of the Oireachtas to annul an Order relates only to Orders made under Section 3. So far as Orders under Section 1 are concerned, they must be submitted positively for confirmation. It is not merely a matter of giving the Oireachtas power to annul an Order by resolution; the Order annuls itself unless there is positive confirmation by legislation within the stipulated period.

Reference was made to a duty on shirts. I do not know whether that duty has been confirmed yet, but perhaps we had better await the Bill confirming it before we discuss the justification for the Order.

In regard to the need for maintaining maximum efficiency in manufacture, to which Senator McGuire referred, I think everybody has now come to realise that, in the new circumstances which may develop in the next year or so, efficiency in all phases of manufacturing activity is the only possible basis for survival. I hope that that is now being very widely appreciated and that there will be a coming together of parties engaged in industry to ensure how that efficiency which means survival can be realised in particular cases. I do not know that we should criticise the people of this country too much for showing a preference for imported goods. I think that is true of the people of every country. Indeed, it is perhaps one of the mainsprings of international trade.

In regard to the determination of rates of duty, that is often a matter for very grave consideration because the circumstances of this country are unusual, in the sense that we have a relatively small market and are situated in close proximity to great industrial producers and individual firms in those nearby countries will often have a surplus production disposable at cut prices sufficient completely to swamp this market for a long period. Where that danger exists, clearly rates of protection to be effective must be fairly high, even though there is an understanding that full advantage of these rates will not be taken by the local producers. In other cases, where that danger is negligible, then lower rates of duty are equally effective.

I do not know if we can lay down any general rules covering these matters. The only realistic course would be for the Seanad to consider each case as it arises and discuss, in relation to the circumstances of that case, the adequacy of the duty imposed or proposed. I am glad that the Bill has been so generally accepted by the Seanad. I think it is a necessary piece of legislation to retain and the changes which are being made in it are generally regarded as improvements.

Question put and agreed to.
Agreed to take remaining stages to-day.