It is just as well that we do not listen too carefully to the Minister. I have never heard so many figures jumbled together in disorder in my life. If one puts up the cost of central Government by £8,000,000 in the Estimates volume alone in a single year, it is necessary to talk backwards and forwards with small figures of various sorts. One of the Minister's statements which I did pick up was that, when the Supplementary Estimates are allowed for, the increase is £3.93 million. I wonder why the Minister bothered to make that statement? Will he have no Supplementary Estimates this coming year? Will he emulate one of his Party predecessors in office who said he would have no Supplementary Estimates, though it turned out that he had a number, despite the fact that he set his face against them?
I do not see any point in that at all, particularly for the current year, in relation to the provision of £1,000,000, or whatever the sum will be, for the new Broadcasting Authority, if the Bill passes in the ordinary way in the next week or two. Apart from that, various other matters loom up. I do not see any point in comparing the eventual figures in the year 1959-60 with the prospective figures for 1960-61. The total on the face of the Estimates volume is £123.5 millions. If one wants to compare the attitude in this matter of the previous Government and the present Government, one can look at the 1955-56 Estimates volume for £105½ millions. That was the year the Government brought disaster on the economy! They had an Estimates volume of £105.5 million.
Are we to understand that if the Government who prepared the Book of Estimates for 1955-56 had at that time an Estimates volume of £125 million, we would not have heard all the talk about the balance of payments difficulty and all the talk about crises? In his reply in the Dáil, the Minister made great play with this matter. He said the food subsidies were not £9,000,000 but £7,000,000 or something else. Reading through the debate in the Dáil—the Vote on Account—as far as I could see, everybody who spoke allowed for the increase in the social services. However, comparing the two volumes, and allowing for the increase in social services, without being too precise about it there is an increase from £100,000,000 to £125,000,000, in round figures. It is as accurate a comparison as any of the figures we hear from the Minister from time to time.
In five years, there has been an increase in the Estimates volume of 25 per cent.—from 1955-56 to 1960-61. The Minister for Finance has a long way to go before he will equal Deputy MacEntee's record in that regard when he was Minister for Finance and when he put up the Estimates volume from £75,000,000, at which figure it stood in the year before he came back into office, to £115,000,000, when allowance is made for the food subsidies. In other words, he put it up by £40,000,000 in three years. The Minister still has a bit to go before he equals that feat, but he is not doing badly! He is doing better in the matter of equalling Deputy MacEntee than I thought he would at one stage. He is doing very nicely indeed. There are other people in the community who are not doing so well.
The Minister said he would not speak about the Programme for Economic Expansion,—economic development, in other words—because there is a report to be made shortly. With the best will in the world, if the report is not better than the last one, it would be just as well if the people concerned did not bother writing it. The last one was of little or no value. I say that in all sincerity. I was very careful a year and a half ago, when the Government White Paper and the Grey Book, as it was called, were produced, not to make any particular remarks about it. I had my own personal reasons for that.
I think the time has come to point out that in so far as there was a central core in that Programme for Economic Expansion, it related to the livestock industry. What has been the experience in the past here in relation to the livestock industry? First of all, the Programme for Economic Expansion set out the hope that the number of cows in the country would increase from 1,250,000 to 1,500,000, which was, as far as I could see, the central and most serious point in the Grey Book.
I thought at the time really that it took the form of baying at the moon because at the time when an attempt was being made to eliminate bovine tuberculosis, the chance of increasing by one-fifth the number of milch cows in the country—a number which had been roughly constant for a whole century—in a period of four or five years was negligible. It did not matter what money you put into it; you could not do it because you had the physical job of replacing the cows that were going out of the herds.
Let me be honest about it. It is not a question of wishing its failure. The Republic of Ireland will be extremely lucky if at the end of the five year period of the Programme for Economic Expansion, that is to say, in the year 1964, there will be as many milch cows in the country as there were in 1959. I am very doubtful about it. That central core of the Programme for Economic Expansion is just wishy-washy wishful thinking. That is all it amounted to.
The Minister, as, indeed, did the Taoiseach, also spoke about the real income of the community going up, that it had begun to increase. The Taoiseach at column 326 of the Dáil Debates of 10th March said:
I have said that the national income is going up and the indications are ... that the two per cent. increase in national income which we hoped to bring about last year was, in fact, achieved, if not something more than that, but that is not the only thing going up.
I think he was wise to put in that latter clause in the sentence so as not to put too much emphasis on what he said. The facts we know up to the present are that following that awful year, 1956—if we are to believe members of the present Government, it was the worst year this country ever had —the real income of this country went up by three per cent. in 1957 and went down two per cent. in 1958.
Despite these prognostications—I have no figure except ordinary powers of observation—I am quite certain that the real income of this country did not go up by two per cent. in 1959. There are obvious serious reasons for believing that. One of them is the fall in the incomes of the milk producers. The other is the fall in the income of the cattle and sheep raisers—a substantial fall in their income. There was an increase undoubtedly in industrial production, though whether that is an increase in real income is a matter upon which one might dilate at some length as to whether, for example, the purchase of an additional 20,000 motor cars by people in 12 months is real income is a very neat point in economic analysis. If the economy here was in any way buoyant last year, I did not notice it.
I notice again that the Minister spoke of what a dreadful year was the year 1958. It was the worst year he remembered since he was born! At least that was the inference. He never remembered a worse year since his boyhood in county Wexford. I could remember one or two worse years climatically, as a matter of fact, if I were asked, and that not so very long ago. The year 1959 was an outstanding year climatically. I would say it was one of the best years we had in my lifetime. We are up against a situation where there will be a negligible increase—an increase not worth speaking about—in the real income of this community in that remarkable year.
I can see why the Government should avoid this topic. I take it we are sliding out of that topic now. I take it that we are pulling out of this economic expansion programme idea— the Programme for Economic Expansion. I take it that the word “development” will be heard less often in the next 12 months than it has been for the past couple of years.
We have this reality here—a sum of £123,500,000 on the face of the Estimates volume. That is for many people indeed a dire reality in a situation like the present. The Government have met this situation in a specific way. They have decided to go in for an internal inflation. I am not to be taken as condemning that altogether, but it is quite obvious from reading the Taoiseach's speech that is what he has decided to do. I am not to be taken as condemning that if it has the same kind of result as it had in certain other countries, but to get these favourable results, that internal inflation has to impact on the economy in certain directions.
Let us look at the expenditure in this volume. Let us take, for example, the £500,000 increase in the provision for forestry. I have many times spoken in favour of forestry. I think it is regrettable that it was not developed earlier. The fact is that you cannot do a genuine job with an extra £500,000 in the current year. Anybody who has looked at the facts and figures published in the reports of the Forestry Division of the Department of Lands will know that it cannot be done with the available quantities of land on hands. The area is going down. The people there are experts in the matter. They say you require certain quantities on hands and in course of preparation before you can plant an area in a single year—three times the area.
It is just a form of social expenditure. That is all it is. Quite frankly, I am not to be regarded, personally at any rate, as being in favour of a social forestry programme. I think it has no merits worth speaking about. All over the country, you see an area where work had been done but there are no trees growing on it. The land shows that it has been prepared and planted but the trees have failed. That would usually be regarded as part of the social forestry programme.
I should imagine that the forestry programme already was expanded to about the limit to which it could be. This new approach is a change of direction by the Fianna Fáil Party, because the Minister for Lands in the Fianna Fáil Government between 1951 and 1954 reduced the acreage of land being planted each year. Now we are to go in the other direction. One asks oneself why. Obviously, it is because it is necessary to give a few more shots in the arm to the economy. This is one of them. There are others in this volume of Estimates such as the increased provision for drainage and so on. Implicit in it is the philosophy that the Government can spend better than the ordinary citizen can.
Twelve months ago, I had a dispute with the Minister as to whether the cost of living had gone up one or two points or not, when the Minister at that stage replied to the debate on the Vote on Account in Dáil Éireann. This year, we need not delay too long on that subject because the cost of living is going up anything from six to ten per cent., say, about eight per cent. in the next nine months.
I should like to make some remarks about the speech of the Taoiseach which, in general, conveyed to the people who listened to it, I understand, the idea of complete defeatism. The Taoiseach could see no way out of our present difficulties. Those difficulties are obviously not accounting difficulties, the kind of unreal difficulties with which so much play was made by certain people in 1956/57. The difficulties facing us to-day are in a quite different category, and the reason is that the economy of the country, having been badly shaken twice in a short period of years on the basis of those accounting difficulties, and deliberately so shaken by people with what I regard as right wing Tory financial views, has not recovered, and will not recover unless there is a complete change of heart in relation to these matters.
The Taoiseach referred, for example, in the course of his speech, to the increase which is to be given to the civil servants, and on that I estimate that roughly there is a sum of about £3½ million of extra remuneration in the Estimates volume. The Taoiseach linked it to some glib phrases about what the Fine Gael Party had done prior to the 1954 election. He said at Column 319 of Volume 180: "The Fine Gael Party at that time may have been thinking merely in terms of a useful election gimmick...."
Would it occur to the Taoiseach at all that the Fine Gael Party were thinking in terms of ordinary equity, that the arbitration award to which the Government were committed should have been implemented? That was my understanding of it. I can say for myself that I never spoke about it during the election of 1954, and that was commented on, but it was spoken about by Deputy McGilligan, who, with the authority of the Party, committed the Party to honouring the award. The Taoiseach said that one of the first acts of the Coalition Government when it came into office was to repay the award retrospectively. With all respect to the Taoiseach's recollecion, it was not one of their first acts. They were in office seven or eight months before they did it. That is the kind of glib phrasing in relation to this matter that I do not particularly like.
He went on to show a complete change of heart on the part of the Fianna Fáil Party. They are now giving to the civil servants a rise in remuneration which the Taoiseach says is not required in order to offset rises in the cost of living such as justified previous increases in their remuneration. He said:
We did it because we recognised that wage rises were being generally secured in private employment and we considered that it would be unfair that public servants should not participate in that movement. We recognise that in all the circumstances which I have mentioned, we have to defend our decision to increase the remuneration of public servants not under the compulsion of an arbitration award but at conciliation level and, to that extent, by our own decision.
That is very poor stuff from the point of view of real economics, though it may be a good election gimmick, and it may be that the Taoiseach had an election in mind. The correct procedure was adopted up to the present except when it was killed by the Fianna Fáil Party during the war years in the most serious circumstances, when the cost of living was skyrocketing and many of their servants were in rags or the equivalent of rags. In general, except for that brief period of the standstill Order on wages and salaries, it has been agreed and on the whole implemented on one or two occasions with a fair degree of liberality, particularly by Deputy McGilligan, that civil servants' salaries should be linked to the cost of living.
In these circumstances, what economic justification is there for an increase of £3½ million in the Estimates volume for people who we are told have suffered no increases in their living costs? Let us compare it with the farmer's position, and particularly with what happened to the dairy farmers last year. I am not to be taken as having any undue sensitivity to the Creamery Milk Suppliers' Association, that particular group of Fianna Fáil henchmen. The dairy farmers suffered a reduction of one penny a gallon in 1959 in the price of milk, although the cost of living had gone up by 15 per cent. since the price of milk was previously fixed, I think, in 1951, when Fianna Fáil returned to office and had made certain promises that they would do certain things. Now we hear again that engines are to be reversed in that territory and the dairy farmers are to get about threepence a gallon extra.
That would not surprise me, because the Fianna Fáil Party delayed a rise in the price of creamery milk at the end of the war until a situation was reached where, in the bad year of 1947, the price had to be increased at one go from 10½d. to 1/2d., an increase of 33? per cent. If you wanted a similar increase to-day, you would want to give them an extra 6d. a gallon. I do not think the Fianna Fáil Government will be as generous this year as in 1947 in spite of that bad year of 1958 that the Minister for Finance has said was followed by an equally bad year from the creamery point of view—a year which I thought was very good, though I admit that the grass did not grow as well during the summer as during the rain of the previous year.
We have a situation in which there are quite obviously real serious problems before the economy of the country and the Minister to-day just gives us a jumble of figures—.5 here and .4 there. There was, however, one important point in the Taoiseach's speech. That was his statement, whoever supplied it to him, on the question of bilateral trade agreements. He said at Column 329:
"We must not think of the European trade situation as being similar now to what it was immediately after the war, when our trade with every country was regulated by a horse trading type of bilateral agreement. That situation has long since passed. There is no country in Europe with which we have any substantial trade which is now operating on that basis."
I have condemned unreservedly the system of negotiating these bilateral trade agreements. As I have said on many occasions, and I notice that more and more people seem to be saying it now, we should certainly take the sternest action in relation to countries which treat us shabbily about these agreements. Let me say that in their worst day the figures were far better than the figures recently published in the Dáil, in reply to a question, in relation to 1959. The best of these western European countries in 1959 were on a three to one basis, that is, selling us three times what they were buying from us, and it went up as high as six to one in the case of Holland and something of that order in the case of Sweden.
I know, of course, that the people negotiating on behalf of these countries, for example, the Germans, have said: "Oh, you have nothing to supply us with." First of all, I do not think that is true. For example, at the time that the particular remark was made by one trade delegation from Germany, butter was 6/6 per lb. in Germany and it was 3/6 per lb. here and the Germans took only a negligible quantity of butter from us. There is only one solution, to my mind, for that kind of thing, that is, to cease trading with such people.
I am, however, concerned by the oblique attempt made by the Taoiseach to show that the system had changed. His next sentence was:
The whole trend is towards a trade liberalisation and the multilateral application of any alteration of changes in import arrangements.
A few years ago, we were doing fairly well with France and Spain. In fairness to the French people at the time, although there was a good deal of odious criticism about one transaction, I think they were in balance of payments difficulties. Even Spain, for all I know, may be in balance of payments difficulties too. There is not one country in western Europe to-day which buys as much from us as it sells to us except the despised market across the Irish sea and the Six Counties. In other words, we are using our entire income from other sources all over the world to buy goods from western European countries who will buy nothing from us. I might also say that I think the negotiators we have had on these bilateral agreements were ill-equipped for their work, or else they were not given adequate authority. I do know that it was said in Germany that they were unsuitable people, that they were not tough enough. That was said to a friend of mine, who goes frequently to Germany.
There is no use in the Taoiseach trying to get out of that serious position by suggesting obliquely that we can now blame it on the Inner Six or the Outer Seven, or something of that sort. There is certainly no progress to be made on that line, and I do not think this country is nearly so ill-equipped with machinery of all sorts that it could not have a show-down with some of these other countries.
There is one other subject to which I want to refer and to which I referred briefly last year, that is the fact that the commercial banks were making no advances and lending nobody any money in the second half of the year 1956 when more than adequate measures had been taken, in my opinion, to put the economy right. As was shown by subsequent events, these more than adequate steps were partly due to inaccurate information given to the Government by various agencies. The commercial banks would give no money and we subsequently had Senator Lenihan dilating here about the position.
These same commercial banks lent large sums of money in the autumn of 1958 when cattle and sheep prices were sky-high. They lent large sums to people who could only sell the same cattle and sheep, at the end of 1959, without making any income whatever out of it. They were lucky if they could pay the interest on the money they had borrowed. The reason was obvious. The price of cattle had risen by 40 per cent. between the second half of 1956 and the second half of 1958. But the banks would not lend one shilling in 1956. The banks which would not lend anything to anybody the second half of 1956 just poured out money at the end of the year 1958.
I notice that the learned journals which write apologies for these establishments do not see anything wrong with that. I notice one of them speaking about the reduction in the monetary circulation putting the banks in a more liquid position—a piece of argumentation which I must say I could not follow. How a monetary reduction could put the banks in a more liquid position, I do not know, considering that the monetary circulation is about the most liquid thing that we could have in a bank.
There is one thing about it, that is, that it is all taking place in rural Ireland. It did not occur in the city of Dublin. Of course, the city of Dublin had been dealt with in 1957 when the building industry was finally killed. Certainly there was no reduction in the second part of last year in Dublin. On the contrary, there was something of an increase with the various wage increases and the obvious overflow of prosperity, Dublin being the nearest point to the British economy, and in the second half of last year, it obviously got a greater benefit than any other part of the country.
Again, we have the Government showing evidence of retracing their steps on their attitude towards food subsidies. At column 194, Vol. 49, of 26th March, two years ago, talking about the butter subsidy, I said:
With the subsequent fall in the value of money... you will find the production of our butter subsidised again.
The Minister went to town on the way Deputy Costello would wig me when he got me outside this room for saying that. It is a strange thing, but my nose tells me that something like that is coming up again; something closely approximating to it, in spite of the wigging I was to get such a short while ago. I have said in this House, and elsewhere, that I am in favour of subsidies. I believe on that basis you keep down costs. If you abolish them, you do not keep down costs, and you get expansion of wages to meet those costs. If you subsequently reinstate them, you get the worse of both worlds; economically, you pay both ways.
One other thing I have noticed, is evidence of a really frightening tendency in our public services with regard to duplication of services. That game, of course, was started in the Department of Industry and Commerce. There is the new Industries Section in that Department and there are the Industrial Development Authority and the Industrial Credit Company. These are all duplications of one function, but they are all writing to one another explaining their various points of view on different matters. They provide a lot of so-called occupation for people which, of course, again is of no real significance to the economy, except as a cost.
I have noticed a similar development in relation to the Department of Agriculture. Other people may have different views on this matter and I know it is not popular in either House to say that something with some good purpose is too expensive. Let us take, for example, An Foras Talúntais. The provision last year for An Foras Talúntais was £50,000. This year, it is £400,000. I know there have been transfers. I know that Johnstown Castle is now included, but I say from my own observation, An Foras Talúntais, the Agricultural Institute, is essentially a research institute. If any one thinks an organisation of that sort can be built up with suitable staff in 12 months, from a figure of £50,000 to £400,000, and that that can be done efficiently, he had better start thinking again. You get only the men who are on offer at the particular time and they will often be second-class men. There is no use in pretending you can build up an organisation like that within a period of 12 months. I do not know whether or not it has been done with the approval of the Department of Agriculture. There is duplication in relation to An Foras Talúntais. Similar work will be done in the Department of Agriculture, in the Central Statistics Office, in the Faculty of Agriculture, in University College, in Trinity College and An Foras Talúntais. Again, the people concerned will spend a lot of time writing to one another.
I want to mention one other subject and I hope the representatives of Dublin University will not mind my mentioning it. I refer to the duplication of the faculties connected with the Veterinary College which was mentioned by the Minister in his opening remarks. That kind of duplication is completely uneconomic.
There is one other aspect of the economy as a whole. We should never forget that nowadays, without being too precise about it, the Government, the local authorities, and State enterprises are responsible for almost 50 per cent of the economic activity of this community. About half of the national income is made in that way, or spent in that way. When we look at these bodies, what do we find? We all know what happened in relation to the Electricity Supply Board. They ended up with about £10 million worth of surplus plant, that plant having been built on the absurd and ridiculous assumption—the kind of assumption someone who has no training in social economics at all would make—of providing for a doubling of the demand for electricity every six years and then every five years. Some more enthusiastic person said every five years, basing that assumption on what happened in western Europe in countries like France with the Marshal Aid allowance coming in the form of electrical equipment for hydroelectric stations.
The financial position of the E.S.B. has deteriorated very much down the years on that account. Quite apart from anything else, they have £10 million worth of plant which could be done without. The day will come, of course, when we shall catch up on that, but in the meantime, we have to pay for the costs of servicing it. I notice the Minister for Transport and Power said publicly recently that he was dealing now with power projects for the year 1964/65. Of necessity, he has to deal with power projects for that year because what is required up to 1964 has already been done.
I am not to be taken as decrying effort or decrying people trying to do good, but let us take the figures for C.I.E. for the past year. We all remember the suggestions in the 1958 Act—indeed we all supported that Act. There were two provisions in the Transport Act, 1958: one was that C.I.E. were to cease being common carriers—that burden was to be taken from them—and secondly, that, when making agreements with people, they would do so on the same basis as any other commercial undertaking on any basis they liked instead of being bound by the fixed railway tariff system.
I did not pay any attention to the matter until recently when I looked at the monthly statistics report and saw that last year when the 1958 Transport Act was implemented, say, from March 1959 to October or November, the receipts of the railway end of C.I.E. were down by £25,000 a week, which is a rate of £1¼ million a year. That was when the obligation of common carrier was gone, and when their obligation to stick to certain rates was gone, and when this great idea of the "Package Deal" had been fully implemented. Of course, if that type of thing continues, some day the Minister will have to produce a vast Supplementary Estimate for C.I.E.
An aspect of the semi-State organisations that is apparent today is the many proposals to build headquarters in the city of Dublin. There is one for tourism in Baggot Street. Another factor which I think is of great seriousness is the inaccuracies in the basic information on tourism. There is a long explanation in the Trade Journal about the way in which the Central Statistical Office collects technical information on tourism. Of course, these bodies, when they refer to “tourism” forget two groups:—first of all, ordinary businessmen visiting this country and, secondly, the returning emigrants who come here for their annual holidays. Time and again, one has heard criticism of this ludicrous figure of £36 million. That figure was badly shaken some years ago and was never to be produced again, but the Tourist Board doubtless kept hammering at the doors of the Central Statistics Office in the Lower Castle Yard and eventually got that office to produce it again.
It all depends on how you define "tourism." If you take every penny spent by every traveller who comes into this country, then the figures of the Central Statistics Office are right. The fact is that the bulk of the money spent in this country to-day by people coming here is spent by people coming over on holidays from Britain. I invite anybody who has any doubts about it to go down to Dún Laoire the week after Christmas or the week before Christmas. A most interesting social phenomenon indeed is to be seen there. The ordinary workers can be seen going back to their ordinary jobs, which they keep on, the day after Christmas and then, as the week extends, you get the more dignified people until eventually you get professional people, and so on, after a week or 10 days. If anybody wants to study social conditions, he could not go to a better place. He will see the ordinary people of Dublin who have had to emigrate go back a day or two after Christmas and the better-off people going back after a longer holiday.
The Irish Sugar Company will erect a large building in Leeson Street. In this territory I notice that the Minister and myself have done our best, though we have each been equally unsuccessful. I know no reason why the headquarters of the Irish Sugar Company should be in Dublin. I notice the Minister made an effort to transfer the Department of Social Welfare to Galway on one occasion. I am sorry he did not succeed. At least he put a decision on the Government records which remained on them for some years that the Department of Social Welfare was to be transferred to Galway.
Another large factor in this Estimates volume is the expenditure on the airports in relation to air companies. It is not all there. There is the provision for 'planes, and so on, outside the Estimates volume. When one thinks of the continuous expenditure on the airports one is reminded of the very noticeable decline in the past twelve months in the income at Shannon. It was a sizable income up to last year but recent figures show it was practically halved in the past 12 months. One must ask oneself at a certain stage what return is forthcoming and in what form does it come from this kind of expenditure.
The same applies to Irish Shipping. I suppose the Verolme Dockyard at Cork is an effort to change that a little. Will the position be that the people of the Republic pay the expense of that Dockyard at Cork and, if anything is made out of it—except the payment for ships which would be a saving to the extent that the work would be done inside the economy—that the profit will go to these kindly people, the Dutch, who are so generous to us when it comes to trading arrangements?
I think I am justified in speaking at such length about this matter. When this volume for 1955/56 was put together at a total of £105½ million it was got down to that figure only by very hard work at night for 2 to 3 months. In that connection, I made a suggestion to the Minister last year and he promised he would consider it but nothing has been done about it. It is a suggestion which would result in an economy of £100,000 a year. It is quite feasible to operate, without any trouble whatsoever. It was that the Soldiers' Pay Section and the Pensions Accounts Section in the Department of Defence should be worked by the Army. It would give these young officers serious work to do and it would save £100,000 a year. I do not see any objection to it.
To small boys, Army work may look like marching around the barrack square, and so on, but the bulk of Army work to-day is in a different category altogether. It is desk work, the same as any other job of administration.
