The purpose of this Bill is to effect a number of miscellaneous amendments in the legislation relating to the E.S.B. These amendments relate to rural electrification, fisheries, compensation for interference with a public bridge, powers to dispose of land, membership of the Oireachtas and pension matters.
With regard to rural electrification, the effect of the Bill in Section 2 is to raise the authorised limit of expenditure to £30,000,000 from the existing limit of £25,000,000 which was authorised in 1955. It was contemplated that the need for new legislation raising the limit would arise this year.
The effect of Section 3 is to reintroduce a capital grant which had been payable from the commencement of the rural electrification scheme until 1955. In 1955, it was considered that the financial position of the board was such that they could provide from their own resources the finance required for future development, and the grant was withdrawn. In the year ended 31st March, 1955, the board had a considerable revenue surplus, including a surplus of £445,130 on rural revenue account. The financial expectations aroused by the satisfactory results in that one year were not realised in subsequent years. In the year ended 31st March, 1957, the board had a deficit of almost £500,000 on the rural revenue account and that was more than sufficient to absorb the surplus on the general account and to put the whole of the board's operations into deficit. In the year ended 31st March last, the board had a still larger deficit on the rural revenue account which produced an overall deficit of £180,000 on the general account.
It should be made clear, in view of certain misinterpretations of my remarks in the Dáil on this Bill, that the board do not need a subsidy in any sense of the term. The provision of this capital grant is to enable rural dwellers to obtain a supply of electricity upon terms which would be reasonable from their point of view. Without some provision of this kind, either the charges for rural suppy would have to be very substantially increased or, alternatively, the board would have to continue incurring these heavy deficits on its rural revenue account, involving an overall deficit on its general account. It is clear that the requirements of rural electrification have meant in recent years the difference between a modest surplus on the board's general account and a loss. That is a situation which is likely to persist in default of something being done about it in succeeding years. The areas left to be connected under the rural electrification scheme are the least economic— the areas from which the average return on capital, represented by fixed charges, will fall heavily—and the annual deficit on the rural account in the absence of any provision for a capital grant would, on completing the scheme, be well over £1,000,000 per year.
Of course, it was part and parcel of the original electrification scheme that a 50 per cent. capital grant would be given to the board. The relief which such a grant will afford to the board is not sufficient to eliminate losses on rural electrification so that to some extent it may be said that the general electricity consumer is supporting, in the charges he pays for electricity, the higher cost of providing a supply on reasonable terms to rural dwellers. There is no doubt that the rate and extent of rural electrification would have been very different if commercial considerations had been taken into account. As commercial considerations were ignored on the insistence of the Government, who desired to see the supply of electricity extended to all rural areas, it is reasonable that the Government should assume as far as possible some responsibility for the financial consequences.
Sections 4, 5 and 6 deal with certain changes considered desirable in the board's accountancy procedures. Section 4 of the Bill will relieve the Minister for Finance and the E.S.B. of the obligation to earmark particular advances to the board as being for rural electrification or for general purposes. In practice it was found difficult to determine beforehand the purpose to which a particular advance would be applied. Actual expenditure on rural electrification will be limited to £30,000,000 and it is contemplated that expenditure for general purposes will be limited to an overall total of £100,000,000.
The effect of Section 5 of the Bill is to permit the board to charge against their general revenue any expenses which they must incur on investigating the potentialities of a fishery before they can decide whether or not to preserve it. Under existing legislation, all such expenses, including expenditure incurred in maintaining and protecting stocks of fish while the investigations are going on, are chargeable to the fisheries account, even though the fishery concerned might never be operated. The restoration of the fisheries is difficult enough without loading these expenses on to the fisheries account. Under Section 5, it is proposed to charge these expenses to the general revenue account.
The object of Section 6 is to enable the board to transfer to the general revenue account the annual profit or loss arising out of their operation of fisheries. It is clear that hydro-electric development involves such damage to fisheries in a river that their rehabilitation assuming it is possible at all, is a long and costly process and deficits are likely to occur for many years before the fruits of restoration work can be expected. As the board's involvement in fisheries is a direct result of hydro-electric development, these operations cannot be regarded as a separate undertaking.
It is proposed, therefore, to abolish the separate capital accounts and balance sheet and incorporate the results of the board's fishery transactions in their general account. In that way, the board's fisheries will be treated in the same manner as their other subsidiary activities, such as installation work and merchandise trading. Separate trading and profit and loss accounts are published by the board in respect of these activities. That will be continued, but the balance on each of these accounts will be transferred annually to the general revenue account.
Section 7 of the Bill authorises the board to pay compensation to persons who have suffered serious loss or inconvenience as a result of the submerging of the Fitzgibbon Bridge by the Lee hydro-electric scheme. The board is empowered under its legislation to submerge or otherwise interfere with any public or private road or bridge for the purpose of carrying out a hydro-electric scheme. That legislation provides that in case of private roads and bridges, compensation shall be payable by the board, but there is no provision in any earlier Act for the payment of compensation for interference with a public road or bridge. In general, in such cases the board are required to provide suitable replacements, unless relieved of this obligation by Order made by the Minister for Industry and Commerce, after consultation with the Minister for Local Government.
In the case of the Lee scheme, the approval Order provided for the submerging of the public bridge over the River Dripsey, known as Fitzgibbon Bridge, and for the erection of a replacement bridge some distance from the site of the original bridge. On investigation, the board found that, because of the nature of the site, the construction of a bridge would be technically difficult and that the cost would be out of all proportion to any use which might be made of it. They sought an Order relieving them of the obligation to construct the replacement bridge. I informed them that the obligation to provide a replacement bridge must be discharged by them, unless they could negotiate an agreement acceptable to the majority of the landholders concerned. I told them then if they succeeded in concluding a satisfactory agreement with the landholders I would promote the necessary legislation to enable them to implement the agreement. The majority of the landholders have now agreed to do without the bridge in return for compensation payments, the amounts of which have already been agreed with the board.
The position now is, therefore, that although the board have negotiated satisfactory agreements with most of the landholders, they have not got the necessary legal powers to make the compensation payments. The object of Section 7 of the Bill is to give the board the power to make these payments.
Section 8 of the Bill is designed to remove doubts about the board's powers to dispose of property. Some of the lands acquired for the carrying out of a particular hydro-electric scheme eventually become surplus to requirements. These powers have never, it is true, been seriously questioned, but it is essential that the board should, if necessary, be able to satisfy a purchaser that their powers of disposal are adequate. Otherwise, a situation might arise in which they would have to retain property they did not need, which would be undesirable. The purpose of Section 8 is to put the board's powers beyond doubt but it does not confer any new powers on them.
Section 9 of the Bill revokes Section 3 of the Electricity (Supply) Act, 1927, which disqualified members, officers and servants of the board from nomination for, or membership of, the Oireachtas. In more recent legislation, the principle followed in relation to State-sponsored bodies is that where membership of the Oireachtas is incompatible with membership of the body, the person concerned may opt for one or the other. The practice now is to provide that a member of the Dáil or Seanad may not be a member of the body and that if any member of the body becomes a member of the Dáil or Seanad, he shall cease to be a member of that body.
The present Bill provides that a member of the Dáil or Seanad would have to resign before he could be appointed a member of the board or take up employment under the board. As regards seeking election to the Dáil or Seanad, it is proposed to make a distinction between members of the board and officers and servants of the board. It is proposed to provide that a member of the board would have to resign before offering himself as a candidate for election or on nomination as a member of the Seanad, but that officers and servants of the board should be free to seek election and if one is elected, that he shall be regarded as absenting himself from his employment with the board and shall not be paid for the period of his absence. He shall be regarded as seconded from the service of the board. In that regard, the aim of this legislation is to put employees of the board on much the same footing as employees of C.I.E. Provision is included to enable an officer or a servant of the board who becomes a member of the Oireachtas to preserve his right to a pension from the board.
Section 10 to 13 are designed to enable the board to pay to their former employees pension increases similar to those provided for other pensioners under the Pensions (Increase) Act, 1956.
Section 14 proposes the amendment of the superannuation terms of the present chairman of the board. It is proposed to cancel Mr. Browne's Civil Service superannuation allowance, and instead, to grant him superannuation on the lines of those payable in the Civil Service and based on the aggregate of his service in the Civil Service and in the E.S.B. The effect of the amendment is that Mr. Browne, on retirement, will be paid a pension of half his retiring salary, together with a gratuity equal to one and a half times that salary. This section implements a decision taken by my predecessor.
Section 14 of the Superannuation Act of 1942 provided that the board could add up to ten years to the period of pensionable service of employees who were 40 years of age or over on the passing of the Act in 1942. Under Section 15 of the Act, they are also empowered to pay supplementary pension allowances to certain persons transferred to the service of the board from undertakings acquired by the board. Section 15 of the Bill is designed to permit the surrender of the whole or part of these supplementary pension awards in return for an appropriate annuity for a dependent, as may already be done in the case of ordinary pensions.
Under Section 14 of the Superannuation Act of 1942, the board are empowered to add up to ten years to the period of pensionable service of employees who were 40 years of age or over on the passing of the Act. Under Section 15 of the Act they are also empowered to pay supplementary pension allowances to certain persons transferred to the service of the board from undertakings acquired by the board. Section 15 of the Bill will permit the surrender of the whole or part of these supplementary pension awards in return of an appropriate annuity for a dependent, as may already be done in the case of ordinary pensions.
Section 16 of the Bill is intended to remove any doubts which may exist regarding the dates of operation of amendments to the existing superannuation schemes of the board.
The purpose of Section 17 is to amend certain provisions of the manual worker's superannuation scheme which have been in dispute between the board and members of that scheme for a number of years following the introduction of an amending scheme in 1952. It is a complicated problem which would take some time to explain to the Seanad. The position, however, is that after various efforts to resolve the dispute were unsuccessful, some time ago a compromise solution of the difficulties was agreed between the parties and as I am satisfied that the solution is fair and reasonable, the necessary section has been introduced to implement it.
The next provision of the Bill is Section 18, which refers to the rate of interest payable by the board on loans made to them by the trustees of the superannuation funds. Section 14 of the 1949 Act provided that the rate should not exceed 4 per cent. With the increases in interest rates which have taken place in recent years this rate is no longer realistic and a position has now arisen in which the trustees can secure a better return on their funds elsewhere. Unless, therefore, provision is made for the payment of a more attractive rate of interest they may invest their funds wholly outside the board. As these funds represent a useful source of additional finance for the board, this would be most undesirable. It is proposed, therefore, to remove the limit of 4 per cent. In view of the possibility of further fluctuations in interest rates generally it would be inappropriate to fix another figure in substitution for the existing limit, and it is proposed, therefore, to provide merely that the rate payable shall not exceed that charged at the time on advances from the Central Fund.