Electricity (Supply) (Amendment) Bill, 1959—Second Stage.

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

Minister for Transport and Power (Mr. Childers)

This Bill contains provisions in respect of a number of unrelated matters affecting the Electricity Supply Board. The main purposes of the Bill are:—

(i) to authorise the increase to £120 m. of the present statutory limit of £100 m. on the expenditure which the Electricity Supply Board may incur for capital purposes other than the electrification of rural areas;

(ii) to authorise the increase to £32 m. of the present statutory limit of £30 m. on the expenditure which the Board may incur on the electrification of rural areas, and

(iii) to provide for the assumption by the Minister for Lands of certain functions at present exercised by the Minister for Transport and Power and of certain new functions relating in each case to the fisheries vested in the Electricity Supply Board.

Other matters provided for include:—

(i) removal of the limit of £25 m. on the amount which the Electricity Supply Board may borrow by the creation of stock or other forms of security;

(ii) the clarification of the Board's powers in relation to fisheries and of the arrangements for compensation for interference with fishing rights;

(iii) matters relating to the form of the Board's accounts and appointment of members of the Board;

(iv) increases in pensions of the Board's superannuated staff; and

(v) establishment of a superannuation scheme for whole-time members of the Board.

In the explanatory memorandum circulated with the Electricity (Supply) (Amendment) Bill, 1953, details were given of the Board's programme for the increase of their generating capacity from 629 megawatts to 1042.5 megawatts by 31st March, 1961. The cost of completing that programme, including ancillary transmission and distribution equipment, but excluding work chargeable to rural electrification, was then estimated at £53.5 million, and to make full provision for the programme would have entailed raising the authorised limit of the Board's capital expenditure for general purposes to £120 million. The Act of 1954 authorised capital expenditure by the Board for general purposes up to £100 million. It was intended that further provision would be made when the need arose, that is to say, when the total of the Board's expenditure and commitments was nearing this limit.

The 1954 programme envisaged the addition of 413 megawatts to the Board's generating capacity during the following seven years, on the assumption that the demand for electricity would continue to increase at the rate of about 13 per cent. per annum, which then prevailed. This rate of increase did not continue, however, and it became necessary to curtail the programme early in 1956. Later the rate of expansion in demand recovered to an extent and the provision of some of the capacity which had been postponed was undertaken.

At present the installed generating capacity of the Board is 728 megawatts and further plant, which I shall describe in a moment, will be commissioned between now and 1964. Planning for the expansion of generating capacity must commence many years ahead because it takes up to five years to bring a new power plant from drawing board to full operation. The generating plant requirements of the Board for the years from 1964/65 onwards were approved at the beginning of this year and a new programme of construction for the five years to 1968/69 has been settled. The programme from 1964 to 1969 is based on an estimated growth in the consumption of electricity at an average rate of 7 per cent. per annum. This was the rate of growth in the two years 1957/58 and 1958/59. While the Board has been planning for an increase in demand of 7 per cent. per annum, the increase in the year 1959/60 and so far this year has been of the order of 10 per cent. per annum. The advance programme has already come under review and it may be necessary to accelerate the provision of new plant. We could not contemplate the possibility of power rationing or power cuts. Apart from the serious social consequences, power cuts could cause heavy losses to industry and rationing would cause incalculable harm to our present industrial effort and our prospects for new industrial development.

Before the first plants in the new programme come into operation in 1964-65, the Electricity Supply Board will have brought into commission in the meantime at Rhode, County Offaly and Bellacorick, County Mayo, 80 megawatts of new plant, all of which will use milled peat. This will increase the total generating capacity of the Board's plant to 808 megawatts. The new programme envisages the addition of a further 340 megawatts of which 160 megawatts will be fired by milled peat and 180 megawatts by oil, and provides for the absorption by 1968-69 of the annual output of all the bogs which are at present considered economically usable for the generation of electricity.

Oil-fired stations will be sandwiched between peat-fired stations so as to ensure maintenance of electricity supply in year in which weather conditions may be adverse for either turf or water generation of electricity or both. To ensure continuity of bog development and employment by Bord na Móna the oil stations will be used only to the extent that water and peat generation is insufficient to meet demand. For the development and exploitation of the bogs in connection with this programme, it is expected that Bord na Móna will provide additional employment for up to about 1,000 men each summer, falling to about half that number in winter.

All the more important rivers have already been harnessed for electricity generation. Stations on the remaining rivers would be uneconomical in present circumstances having regard particularly to the high initial capital costs and current high interest rates. The Electricity Supply Board, however, are continuing to collect data and investigate other rivers with a view to possible later development for hydro generation. The Board have in operation a 15 megawatt generating station at Arigna using native coal and considerable quantities of native coal are also used at Ringsend station. Although the use of nuclear energy for generating electricity is not foreseen in the immediate future, the Board is keeping in close touch with developments in this field.

The process of increasing the quantity of generating plant and ancillary equipment has been continuous for many years and it will continue for many years to come. The authorised capital expenditure of the Board for general purposes is at present subject to a limit of £100 million and this limit will be reached about 31st March, 1961. We are providing in this Bill for an increase in the limit, to £120 million, to enable the normal process of development to continue for the next three or four years. The sum is not allocated in advance as between each year but the Capital Estimates, for each year as they become availaable, will contain particulars of the estimated annual allocations.

The financial provision I have described will cover some of the expenditure on the advance programme of the Board; that is, the programme for the years from 1964-69 inclusive, which I approved at the beginning of 1960.

It is, on occasion, suggested that the Board has an excess of generating capacity. I could deal with this suggestion at some length but it should be sufficient to refer to the Annual Reports of the Board for the last two years which indicate that, in 1958-59, due to shortage of both turf and water and in 1959-60 due to shortage of water alone, it was necessary to draw on the Pigeon House Station which is the standby station of last resort. I might also say that the advance programme up to 1969 was proposed to me in its entirety by the Board and that after careful examination I approved it without modification. At no time was there any pressure on the Board to formulate the programme.

Another contention which is sometimes made about the Board's generating plant is that the turf stations are unduly expensive in comparison with those operated with coal or oil. If we disregard cost for a moment we can find very compelling arguments for the use of turf for power generation— the tremendous employment afforded by Bord na Móna and the reduction of our import commitments. It is not necessary, however, to disregard costs. In milled peat, Bord na Móna has produced a highly efficient fuel which in the last year or two, with imported fuels virtually at a discount, has compared very favourably in fuel cost per unit with both coal and oil. Milled peat is the fuel which is going into all the new turf stations.

The Bill raises by £2 million to £32 million the total amount which the Board may spend on the electrification of rural areas. It had been estimated that a total of £30 million would be sufficient to complete the scheme but a wider response in some areas than had been provided for has resulted in increased expenditure and it is now expected that by the time the scheme has been completed, in about another two years, expenditure will approach £32 million. As the scheme nears completion, the rate of progress has slowed down slightly but, nevertheless, forty areas were completed in the year ended 31st March, 1960, and completion of forty more areas is expected in the current year. At 30th September, 1960, the number of areas completed was 708, and there were only 84 areas in which work had yet to commence. The raising of the limit of £30 million to £32 million involves increasing the total amount of the subsidy which may be paid to the Board by £1 million but no change in the principle of subsidy is involved.

The rural electrification programme has proved a heavy burden to the Board. This is partly due to the withdrawal of the 50 per cent. capital subsidy in 1955. In addition, however, the rural areas developed in recent years and those remaining to be developed are the more uneconomic areas and the subsidy of 50 per cent. of the capital cost which was restored in 1958, is not sufficient to enable supply to be provided except at a continuing loss to the Board. The regrettable result is, that, over the past three years, the Board after taking account of surpluses on its non-rural operations showed overall revenue deficiencies amounting in the aggregate to £750,000.

The statute clearly sets out the duties and responsibilities of the Board in circumstances of this kind. It is entirely the responsibility of the Board under Section 21 of the Electricity (Supply) Act, 1927, to ensure that its revenue will be sufficient to meet outgoings. In discharge of this responsibility, the Board recently announced an increase in charges which, I understand, will add approximately 5 per cent. to its total revenue.

The relevant statute does not enable me to intervene in the matter but I am in very close touch with the Board and I am satisfied that if the increase had been avoidable the Board would not have introduced it. The position is, indeed, that if the revenue of the Board had not been sufficient to meet outgoings the provisions of the statute would, automatically, have precluded the increase in charges. If the charges had not been increased it would have been necessary to assist the Board from public funds, that is, from taxation. Taxation would have been an alternative means of raising the sums required but the charge would have fallen on substantially the same body of persons.

In connection with the price increase, however, I have been struck by the fact that the average price per unit for all electricity sold by the Board in the year 1959/60 was only 36 per cent. above the corresponding price in the year ended 31st March, 1939. This compares with increases in the costs of gas, oil and coal over the same period ranging from 145 per cent. to 218 per cent. and with increases of 164 per cent. in the con- sumer price index, 232 per cent. in the wholesale price index, and nearly 230 per cent in average earnings per week in industry.

The comparisons I have quoted and indeed the general record and reputation of the Electricity Supply Board reflect the efficiency and devotion to the public interest with which the Board and their staff have discharged their responsibilities. The Board are not complacent, however, and take every opportunity to increase efficiency further and reduce costs. I am glad to know that in these respects, the Board, like other forward looking organisations, is making use of modern techniques such as work study.

The Bill provides for withdrawal of the limit of £25 million on the amount which the Electricity Supply Board may borrow from the public by the creation of stock. When the Board was first authorised to seek capital from the public under the 1954 Act, a statutory limit was set to the amount which the Board might so borrow. Experience has shown that this limitation is unnecessary and the present opportunity is being taken to remove it. The prior consent of the Ministers for Finance and Transport and Power will, of course, continue to be required to each public borrowing operation by the Board.

Under existing provisions the Board has made two issues of stock totalling £15,000,000.

The Bill also makes provision for the assumption by the Minister for Lands of certain powers and functions in relation to the fisheries vested in the Electricity Supply Board. A few provisions in existing legislation bearing on the Board's fisheries provide for the consent of the Minister for Transport and Power in certain cases, but, in general, the Minister for Transport and Power has no function in regard to the Board's fisheries nor has he available to him the information and technical advice which he would require to deal with any matter which may arise in regard to them, either in the Oireachtas or elsewhere. It is desirable, therefore, that the Minister for Lands, to whom the necessary information and technical advice are available, should be more closely associated with the administration of the fisheries and that the occasional questions which may arise should be dealt with by that Minister.

In the administration of the fisheries under their control, the Electricity Supply Board have concentrated mainly on the development of angling and commercial salmon fisheries and commercial eel and oyster fisheries. The position in regard to the trout and coarse fishing under the control of the Board has, accordingly, been under consideration by the Minister for Lands. The Board have fairly extensive powers in the matter of awarding leases of trout and coarse fisheries but have not widely exercised these powers. The Minister for Lands feels that the rights which the Board find possible to grant are inadequate to enable lessees to develop these fisheries in the best way.

The Minister for Lands desires that, in any case where it would be in the national interest for the Board to grant a lease in respect of trout or coarse fishing to the Inland Fisheries Trust or some other suitable body, he should have power to influence the Board in the matter. He considers that angling for trout and coarse fish should be on an agreed plan, in the devising of which he will seek the advice of a joint committee representative of his Department, the Inland Fisheries Trust, Bord Fáilte and the Electricity Supply Board.

If the development of particular fisheries can best be achieved by leases of certain waters, the Minister for Lands should be in a position to indicate the term of years the lease should run so as to allow of adequate development and protection in each case. The Minister for Lands has made it clear that in the matter of leasing of Electricity Supply Board Fisheries, the object would be to ensure as far as possible the full development of these fisheries. In this, due regard would be given to the salmon fisheries and their primacy recognised.

I am satisfied that the arrangements now proposed will not compromise the management responsibility laid on the Electricity Supply Board and a provision has been included in the Bill to meet the desire of the Minister for Lands.

There are also three minor provisions in the Bill to repair defects in the legislation relating to the Board's fisheries:—

(a) New Fisheries arising in E.S.B. waters:

Under present legislation, the Board have power to manage fisheries which they have acquired but they have no general power to manage some new fisheries which have arisen mainly in the reservoirs of hydro-electric schemes. The hydro-electric schemes were bound to destroy existing fisheries by submersion in the reservoirs and otherwise, and the Board had no option but to acquire them under Section 7 of the 1945 Act. On the basis that the fisheries would be destroyed no provision was made for their management. It is now proposed that the Board be given power to arrange for the preservation and maintenance of the new fisheries which have arisen.

(b) Compensation for interference with fisheries:

The destruction of fisheries interfered with the livelihood of a number of persons employed in fishing and Section 18 of the 1945 Act was designed to provide for the payment of suitable compensation to them. The measure of compensation laid down in the Act is such as is considered reasonable for total loss of profits or earnings and all persons who have so far received compensation under that section did in fact suffer total loss of their profits or earnings. The Act did not, however, provide for partial compensation for persons whose profits or earnings were merely reduced but not extinguished.

The establishment of an electricity generating station on a river may not immediately affect the earnings of such persons, but progressive diminution in the run of fish, attributable to the establishment of a hydroelectric station, may later occur and the earnings of such persons may be reduced. To provide for the case of such persons, the Board is now being authorised to pay compensation to them in proportion to the measure of their loss and to make further payments to them in the case of any subsequent losses until the total of payments reaches the compensation appropriate to total loss of earnings.

The purpose of the third minor provision in regard to fisheries is to repair a defect in the Board's title to the Shannon Fisheries. It was intended that the Shannon, Fisheries Act, 1938, would transfer these fisheries in to to the Board but the relevant provisions were not effective to transfer any State-owned fisheries which might have existed in the waters of the Shannon. The present Bill proposes to confirm the title of the Board to all fisheries in the waters of the Shannon.

The Electricity Supply Board, being the first of our semi-State bodies to be set up, was inevitably burdened with a few very rigid procedural obligations which later experience has shown to be unnecessary. The present Bill provides for two modifications of procedure. Firstly, the cumbersome arrangement which requires members of the Board of the Electricity Supply Board, on the occasion of any alteration in their remuneration or allowances, to resign and be re-appointed, is being abolished. Secondly, it is proposed to end the requirement that the the Minister for Transport and Power, with the consent of the Minister for Finance, should prescribe by regulation the time, place and method of conducting the audit of the accounts of the Electricity Supply Board, the accounts to be furnished to the Minister and the accounts to be published and put on sale. Modern practice has been to allow the responsible Minister to give an informal direction in such cases and it is desirable to bring the position of the Electricity Supply Board into line with the modern practice.

Further provisions of the Bill will allow the Electricity Supply Board to grant to their pensioners increases similar to those allowed to public service pensioners in 1959 and 1960.

The opportunity of the present Bill is also being taken to bring the legislation in relation to the superannuation of whole-time members of the Board of the Electricity Supply Board into line with legislation enacted since the passing of the Electricity Supply Board (Superannuation) Act, 1942, in regard to the superannuation of whole-time members of the boards of semi-State bodies. The Bill provides that the Minister for Transport and Power, with the concurrence of the Minister for Finance, may make a scheme or schemes covering the superannuation of whole-time members of the Board. The schedule to the Bill sets out details of matters to be provided for in any superannuation scheme made under the provision.

I am very happy to recommend this Bill to Seanad Éireann. The Electricity Supply Board is one of the oldest of our semi-State bodies and one of the most effective. The success which has attended its efforts over the years, on which the management and staff deserve our most sincere congratulations, has in large measure contributed to the economic advancement of the nation in general. The enactment of this Bill will enable the Board to continue their good work.

Dr. O'Donovan

I never used the words.

Mr. Ryan

You did not have to use the words. You implied it clearly.

An Cathaoirleach

I want to have this issue clear——

(Interruptions.)

An Cathaoirleach

The Senator is not charging the Minister with uttering an untruth?

Dr. O'Donovan

I said that the Minister's statement——

An Cathaoirleach

I want "Yes" or "No" to the question.

Dr. O'Donovan

No, Sir; I cannot answer a question like that. I said the information sent by the Minister to Deputy McGilligan was incorrect.

Tomás Ó Maoláin

You said it was untrue.

If it is for both sides of the House and not for one.

Dr. O'Donovan withdrew from the Chamber.

Professor Quinlan

I welcome this opportunity of paying tribute to the excellent work done down the years by the E.S.B. They have set a headline for all of our semi-State bodies. If there is any lesson to be learned from them it is the lesson that the E.S.B. was staffed by men who were technically trained at the start. The engineers carried the main brunt of the development and they justified in every way the confidence reposed in them by the state.

Having said that I should like to say a word of caution. The whole Bill is based on the Principal Act of 1927 and I think the time is long overdue for having a commission at the functioning of the E.S.B. I am not saying there is anything wrong, but, after 33 years of public service, it is now time to take a look at the functioning of this body to see whether the functions of the 1927 Act have broadened or become restricted.

I am very disturbed that these general purposes for which we are asked to vote an increase from £100,000,000 to £120,000,000 apparently are to involve going into competition with retails traders in electrical appliances and apparatus. I for one cannot share the enthusiasm which greeted the opening of the new E.S.B. showrooms in Cork City. I regard it as being very unfair to the private traders engaged in the supplying of electrical——

Tomás Ó Maoláin

Was the Senator at the opening?

Professor Quinlan

I was not. I believe that taking over a main building like this and doing it up in such a grandiose fashion was wrong. I am further disturbed when I see that this tendency apparently is to seep down into small country towns and villages. I have in mind a small town in Limerick which has less than 1,000 inhabitants and in which a principal corner is to be taken over and, with this money which we are voting, very elaborate showrooms erected. That is despite the fact that in the same town there are two or three small electrical supply people, individual concerns working 12 or 14 hours a day to give a very satisfactory service to the people in the locality. I do not know of any demand for these showrooms or that there have been any complaints about the service those people are rendering. Consequently I believe this is a tendency which should be investigated immediately and which should be stopped.

I believe that if we are to extend the functions of the E.S.B., we could very profitably extend them where the first-class scientific talent at the disposal of the E.S.B. could be utilised. I have in mind the manufacturing, say, of cable and other commodities of which considerable quantities must be imported at present. That would provide a fruitful field of endeavour for the E.S.B., along lines similar to those adopted by the Irish Sugar Company. It has broadened its functions to include the development of machinery for its beet harvesting, as well as other sideline activities, including the development of research. Those seem to me most laudable additions to the company's primary function of producing sugar from beet. In the same way, the E.S.B. should broaden out and engage in similar appropriate functions.

Many of us feel that this country has been slow in developing along the light engineering side of electronics. We read about the large-scale factories in Holland and elsewhere which employ thousands of workers in the field of electronics and I believe within the E.S.B. we have that high-powered talent which could profitably develop such activity. Not alone that, but we have, in the board, the financial backing and standing which would enable it to get into those fields with profit to the board and to the nation as a whole. I suggest that the time is long overdue to have a look at the functions of the E.S.B., and then plan a course for these extra activities over the next 15 or 20 years.

The other point on which I wish to comment is in regard to the rural electrification service in respect of which we are increasing the limit from £30,000,000 to £32,000,000. Very soon, all the areas mapped out will be completed, but that will still leave certain places in the more remote areas which will not have got the amenity of electricity. I feel we owe something to the people in those regions. We cannot treat them like the unfortunate people of West Cork are about to be treated. We cannot ignore them and say that because it is not economic to provide a service for them, therefore they cannot have it. I suggest there is a way out. I do not advocate the totally uneconomic course of electrifying all these areas but I believe that in the development of calor gas for heating, lighting and power, we have the solution for those areas which may have proved uneconomic for development under rural electrification.

I have no doubt that those who visited the Whitegate refinery were struck by the waste of a resource, the fact that gas has to be burned because it is no use and that only a fraction of the gas produced can be used commercially. I understand that the same supply would provide sufficient for the development of practically all the areas outside those developed under rural electrification and I would ask the Minister to look into it as a means of bringing comparable advantages to the people outside the areas considered uneconomic for development at present.

In regard to the development of nuclear power stations, I was glad to hear the Minister say that this is being kept under review. I know that apparently there is not the same urgency for developing nuclear power now as there appeared to be three or four years ago, because the natural resources of fuels are not likely to be exhausted as quickly as appeared likely some three or four years ago. Therefore, the development of nuclear power has been slowed down somewhat. I know that the authorities in the English Atomic Energy Commission see in this country a very valuable place for the siting of nuclear power stations for Western Europe as a whole because these stations have to be sited away from regions of dense populations and there are very few parts of Western Europe which satisfy that requirement.

With the strides that have been made in conveying electricity across water barriers by means of a direct current transmission, it is quite feasible in the very near future that current generated here could be sold to the European Continent. Of course, it would be a very costly undertaking and probably the capital involved would be beyond our ability to provide. In addition, the return might not be all that attractive.

I feel that in the future either power concerns in other countries or other groups may be willing to invest in the development of nuclear power stations here in some of the more remote parts of the country. When these are properly controlled, I do not think there should be the slightest worry about any hazards involved. I think that is all I can add, except, again, to pay a well-deserved tribute to the E.S.B. and, above all, to the engineering staff of the Board who have shown that they are capable of combining both expert management with top-class technical efficiency.

Mr. L'Estrange

Éamon Ó Ciosáin

They are trying to get publicity.

Tomás Ó Maoláin

The Senator should get a transquilliser when he goes out.

Senator L'Estrange withdrew from the Chamber.

Mr. O'Grady

I rise to direct the attention of the Minister and the House to what I consider a grave injustice done to the people of Clare ever since the E.S.B. was established. The lands taken over in Clare for E.S.B. purposes had a valuation of £267 13s. and the buildings thereon a valuation of £280. The two together make a valuation of £547 13s. That is free, exempt from rates, and has contributed nothing to the rates in Clare during the past 32 years. As well, salmon weirs and eel weirs, carrying a total valuation of £450, have been taken over and, I understand, they are also exempt from rates. That makes a gross total of £997 13s. which should be carrying a valuation, judged by ordinary commercial standards. The present rate in Clare, I understand, is 40/- in the £. That makes a tidy sum of £1,995 6s. which the E.S.B. should have paid to the funds of the Clare Co. Council in the past year.

A Senator

Each year?

Mr. O'Grady

This is the highest. In the preceding years, it would be on a sliding scale. On a rough calculation, that means that for the past 32 years the E.S.B. got out of the rate-payers £63,857 12s. by way of rates arrears.

I should like to direct the attention of the House also to another enterprise in Clare, that is, Deputy Dillon's rabbit warren situated at Shannon Airport. That at the present time has a valuation of £12,062 16s. The rates paid by the authorities of Shannon Airport to the Clare Co. Council during the past year were £20,131 13s. 7d. What a contrast! I cannot understand why, if Ardnacrusha and the buildings thereon are free from valuation and free from rates, Shannon Airport is not likewise free and, vice versa, if Shannon Airport has to contribute £20,131 a year—and the valuation is growing, thank God—why should the E.S.B. not have to pay a proportionate contribution according to their valuation? I want to know if the same operates in the other schemes at the Liffey, the Lee and the Erne. Are they also exempt?

Incidentally, I want to know if the power stations in connection with Bord na Móna are contributing a rate or if they are specially exempted in those counties. If they are not specially exempted, why should there be one exemption, that is, in respect of the buildings and lands taken over for electricity purposes at Ardnacrusha?

The Minister has had no notice of my raising these matters but I want an answer to them at the earliest opportunity. I think that more than your humble servant in County Clare would like an answer to the questions. Everybody interested in justice would, I think, be anxious to know why that scheme alone should be exempted from rates, if all the other undertakings I have referred to are carrying a rate and contributing a fair share to the rates and expenses of the county.

Mr. O'Quigley

This Bill is concerned with the generating of electricity. Obviously it has generated a great deal of heat in this House this evening. I think it is regrettable that a scene such as we have witnessed tonight should have occurred. I do not intend to assign the blame for the situation in which this House found itself, but it is regrettable that it should have arisen. There seems to be a considerable difference of view between people on this side of the House and the Minister as to whether or not the E.S.B. system at present has an excess of generating capacity.

The Minister has given a figure which seems to indicate what I calculated—22 stations. We gather that they all generate at the maximum point and when carrying the maximum load they are all generating electricity at 100 per cent. That seems to be a correct figure.

Ringsend Station, on the Minister's statement, comes in only as a station of last resort. It is understandable that when that station is brought into operation, it will be generating electricity at something near maximum capacity and that all the other stations, having generated at maximum capacity, have not been adequate for the needs of the moment. The figure being asked for, I venture to suggest, is whether or not there are some stations lying idle for a considerable period of the year and what the average generating capacity of these stations is over the year at peak.

That would be a different figure, I imagine, from the figure supplied by the Minister for Industry and Commerce. I think it was quite clear what Deputy McGilligan was seeking in the questions put by him to the Minister for Transport and Power on the Fourth Stage of the Bill in the Dáil.

I do not understand the position. On the one hand, the Minister apprehends, as I understand his statement, that we may find ourselves in a position where, if the E.S.B. is not supplied with more capital to instal more generating plant, there will be power cuts which will have drastic social and economic consequences which he wants to avoid. At the same time, for some years past, the E.S.B. to the knowledge of all of us who travel on buses and keep our eyes open and pay electricity bills, have been indulging in an intensive advertising campaign to get people to use more electricity.

It does not seem to hang that, on the one hand, there is a fear that we may find ourselves faced with power cuts and, on the other hand, that the E.S.B. is apparently anxious in its advertising policy to encourage people to use more and more electricity.

The reports of the E.S.B. are notable for the dearth of information they contain. When they are printed, on very fine paper, they might, for the benefit of the uninitiated who want to understand what the Board is about and what have been the results of its activities over a particular period, try to set out the position in language intelligible to the average Irishman who may be interested in reading them. This book is unintelligible to most people. I can only hazard a guess as to its meaning. It may be said that I am subaverage in intelligence; anyone who wants to make that charge can do so. I do not think that is a proper kind of report for the E.S.B. to present to the public.

There seems to be a contradiction between the Minister's fears of a threatened shortage of power and the E.S.B. policy of advertising. On top of that, there is this other factor. Some years ago and within my time in Seanad Éireann, the present Taoiseach, when Minister for Industry and Commerce, introduced a Bill to expand the capital of Bord na Móna. At the time, I ventured to express the hope that the increased capital of Bord na Móna would be used in such a way that the ordinary householder who wanted to use Bord na Móna turf, briquettes, and so on, would have them available in more ample supply than they had been up to that time. I hoped that that would be one effect of the increased capital for Bord na Móna.

The then Minister for Industry and Commerce—the present Taoiseach— was very quick to retort that that was not the intention in increasing the capital for Bord na Móna. He said it was intended that the capital would be used to develop bogs for the supply of milled peat and other peat for electricity generation. In no time the market has been flooded with Bord na Móna turf which suggests that the E.S.B. has not been using and is not using the turf or briquettes and that its activities are not directed towards supplying the basic ingredient for the generating of electric power.

That suggests that there is some substance for the uneasy feeling that this white elephant which we should all like to see well fed with capital is not alone being well fed but overfed—and overfeeding is as bad as starvation.

I entirely agree with the suggestion by Senator Quinlan that after 33 years, the operations of the E.S.B. could be investigated, if only for the reason that a periodic investigation of the functioning of any such body would keep it on its toes and ensure that its operations are carried out at peak efficiency. I have a recollection of expenditure by the E.S.B. outside my own door. It took about five to seven employees four days to do the same kind of work as I saw one man do by himself in one and a half days. When they had finished their work, which was merely making a bit of a path into a transformer, the path would not run the water, so that the total work was a dead loss. On top of that, they left behind them, as a kind of a res nullius which the people around the place took advantage of, about half a load of gravel which was trampled on by local children. Eventually, some of it found its way usefully into the back gardens of the local inhabitants.

That is the kind of operation which, if you had a proper audit as you have under the Comptroller and Auditor General, the Board would be asked to account for and explain, and that is the kind of thing that does not happen on any widespread scale in the public service because of the fact that you have a rigid system of auditing and accounting which involves not alone seeing that money does not find its way improperly into anybody's pockets but that it is not wasted.

When you have that kind of thing going on, it would be a very useful function to ensure that a body which has proved itself so good might in fact prove itself better, and that instead of the minor amendments which the Minister is introducing to the 1927 Act, particularly in relation to the auditing of accounts, for which he has given no explanation except that it is the modern style, that the Minister by informal direction determines what accounts are to be given, the Minister, who now has only transport and power to look after specifically, might consider the advisability of reviewing the operations of a semi-State concern with expenditure as big as this, where, as far as I can see, so far from the average price per unit of electricity sold decreasing with the greater number of consumers, it has been tending to increase, particularly since 1951. Perhaps the Minister's explanation might be that that is the cost of bringing electricity to rural areas. I do not know, but I should have thought that that was covered by the subsidy for capital development in rural areas.

There is another matter which seems to me to call for some comment. We cannot dam up the waters and store them for the dry season, but I should have thought it was possible— perhaps I am speaking from profound ignorance—in very good summers to lay up a stock of peat for use on occasions when we have either a bad summer which does not give us an adequate supply of peat or an unduly dry winter. That seems to me to be a matter of planning. It does not seem to be done to date, and the supply of turf is on a yearly basis, instead of carrying over some and building up as big a stock as is possible for use in those emergencies, instead of, as appears to be the position, turning over to oil-burning stations when stocks of turf supply and the rain water, mirabile dictu, run too slow.

I am not at all clear as to what the position is with regard to pensions under Section 13 and 14 of this Bill. Perhaps the Minister would indicate the categories and how it comes about that there are varying percentage increases for different categories. As far as I can read it, persons who retired after 1st September, 1956 do not gain any increase in pension under this Bill. I should imagine that the cost of living has risen somewhat since 1956, so that those people would also be entitled to an increase in their pensions with those who retired before 1956.

It strikes me with regard to the point raised by Senator O'Grady that it was right and proper in the 1920's that this first venture in a State-sponsored body should be exempted from rates. I should perhaps say for Senator Sheehy Skeffington's information that at the time when the Electricity Supply Board was being established, there were at least half a dozen capitalist firms in Germany and the United States who were only too anxious to get a licence to do what the E.S.B. subsequently did.

Dr. Sheehy Skeffington

They would not have done it as well.

Mr. O'Quigley

We do not know about that. At any rate, to keep the position clear, there were in fact at that time quite a number of people outside the country who were willing to take on the job.

Dr. Sheehy Skeffington

And to take the profits outside the country, too.

Mr. O'Quigley

It seems that while there was a case for not obliging the E.S.B. to pay rates in respect of its property and buildings in County Clare in the 1920's, that has long since gone, and that is a matter which the Minister should seriously consider in justice to the people of Clare, who ought not to be bearing on behalf of the whole country an undue burden. If Senator L'Estrange were here, he would probably say that that was a penance for a particular sin they committed for many years.

Mr. Lenihan

In relation to this discussion, there are certain realities which should be borne in mind. The first is, that, in 1954, the Electricity Supply Board prepared a programme of generating expansion on the basis of an increase of electricity demand at that time. That programme was announced and in 1956, which is the key year, it had to be modified considerably because in that year there was a reduction in the demand for electricity. In other words, the economy was being run down to the extent that the power requirements were not what they appeared to be two years before, and the result was that the Board rightly met the slump situation in 1956 and decided to curtail expenditure on the expansion of its own power requirements.

However, happily the situation which obtained in 1956 does not obtain to-day, and we have an increase of steady progress in the past three years. In passing, it might be no harm to mention that power demand and increase of power demand is one of the best indicators of economic progress in any country. It is quite clear that whereas in 1956 there was this slacking of power demand which caused the Board to curtail their generating expansion, in the following years that situation changed, and in 1957-58, there was a 7 per cent. increase in the demand for electricity; in 1958-59, a 7 per cent. increase in the demand on the previous year; in 1959-60, a 10 per cent. increase in demand on the previous year; and the indications are that in the present year 1960-61 that rate of increase in power demand will continue. It is that very simple expansion in power demand reflecting the expansion of our economy that has now induced the Board to expand the programme already envisaged in 1954 and which the Minister has now announced to us, will reach completion in 1968-69.

To meet that expansion in demand, that regular expansion, in the past few years there has been an increase from 609 megawatts to 728 megawatts and in the immediate future before 1963, that will be raised to 808 megawatts with the completion of the power stations at Rhode and Bellacorrig. A further 340 megawatts will complete the generating capacity programme by 1968-69.

It is quite apparent from that that what was a very proper programme based on the realities of the situation in 1954 became, in 1956, a practical proposal with the revival of our industrial economy in recent years and the consequent extension and expansion of the power demand. The E.S.B. have revived their generating programme and, as outlined by the Minister, will reach the present planned capacity in 1968-69. In that connection, I thought that a lot of the contributions made tonight by the other side of the House, and by Deputy McGilligan in the Lower House, were unreal and woolly.

The present planning in regard to power is based on the extension and expansion in the demand for electricity, and that extension and demand are largely due to the expanding needs of our growing industrial development, and to the indications I have mentioned; a seven per cent. increase three year ago, a seven per cent. increase again two years ago, and a ten per cent. increase last year. Those figures almost approximate to the expansion in industrial production and industrial exports in the same years. We have the two percentage increases side by side to prove that there is no point in not having power unless you have further consumer demand for that capacity and the greatest consumer demand obviously must be industrial. In that connection this extension of the E.S.B. plans is a reflection of the expanded industrial economy in the country.

One very welcome factor in recent years has been the cooperation and interrelationship between the activities of the E.S.B. and Bord na Móna, especially since the milled peat development which bears comparison with any other type of fuel, as regards economy, in the world. That is a development in which we can take a certain pride. Bord na Móna launched out on the milled peat project some ten years ago. We were the first in the world to develop it and it has now proved to be as economic as and, in some cases, more economic than, any other form of fuel.

It was the milled peat development which enabled Bord na Móna to fit in with the E.S.B. and provide them with efficient low-cost fuel from which the E.S.B. could develop and generate power for the country. That interrelation will have very practical results when this programme envisaged by the Minister is completed. It has resulted in an extension of the briquette factories and an extension of the employment in the Bord na Móna camps. As a result of the expansion of the E.S.B. generating capacity, 1,000 extra people will be employed, and on the completion of the programme, there will undoubtedly be improvements with regard to briquette production and other activities.

Senator O'Quigley got a bit mixed up when he said that the interrelation between the E.S.B. and Bord na Móna did not appear to be quite so happy, now that Bord na Móna were going into the business of selling fuel to a greater extent. I did not understand the point the Senator was getting at. Surely those are two distinct developments in Bord na Móna activity. On one side there is the domestic fuel, the production of briquettes now happily going into the export market in Britain. That is one facet of their activity and the power facet is an entirely different facet. The two are not contradictory. They run side by side and represent different facets of the Board's activity.

I do not think there is anything more to be said at this stage. This is a financial Bill making financial provision for the extension of the Board's activities. As such, it is welcome, and the extension in power capacity is a welcome and further indication of the economic progress taking place. For that reason, the Bill should commend itself to the House.

Mr. Lahiffe

I rise to make one observation. In spite of the fact that most of the country is already lighted by electric current, in many small isolated parts of the western countryside, we still find small pockets left without current. The reasons are perhaps economic. We find that in order to get into the extreme end of the pocket, the E.S.B. decide that each and every householder must accept before they started work on the main pocket. If one householder on the outside refuses, the rest must wait until he can be got to accept the current, but if he decided for his own reasons—perhaps that he could not afford to take the supply—the rest are deprived of supply. These people may be prepared to accept it later on, and they will not be supplied unless they are prepared to pay the full cost of the connection for the whole area, with an increase of one-third over and above the cost of the original survey. The Minister should take this matter up and give to these people the same opportunities their better-off neighbours have.

In other pockets, we find that in the case of an isolated house in an out-of-the way district, the householder must pay the full cost of development. That is unfair and it is also unfair that in the other case they have to pay an extra one-third of the cost. That is the only point I wish to raise. I would say to the Minister that in the interests of fair play and justice, these people should have the same conditions as their better-off neighbours had when the place was being developed.

Mr. Hogan

I support what has been said by the previous speaker with regard to the pockets which exist in many areas throughout the country. It is a great disappointment to people, after waiting half a lifetime for the benefits of rural electrification, and after having their houses wired and all preparations made, to be told that because they are living in outlying areas away from the main source of supply, electricity cannot be supplied to them, except by paying an enormous rate—in some cases an increase of 50 per cent. on what they had already been assessed for.

I strongly urge the Minister to look into this matter. There are a few such cases in every area. The fact that people are living in backward parts of the country in my opinion, is a compelling reason for making available to them the facilities which are available in the more progressive areas, so as to encourage them to remain there, in view of all we hear about keeping people on the land. I know people in my own area who had their houses wired and because a neighbour fell out with them, they could not get the supply except at a heavy additional cost. I appeal to the Minister to look at those areas. In my opinion, they should be made a capital charge and if a householder is willing to take the electricity supply at the ordinary rates charged to the majority, then he should get it.

Dr. Sheehy Skeffington

I rise to make just two points. One of them arises from what Senator Lenihan said about the use of milled peat for the production of electricity. I think he painted an over-rosy picture when he said we were one of the first countries in the world to do this. I distinctly remember in 1935 Mr. R.M. Tweedy coming to the Engineers' Society in Dublin and showing that this had been done in Germany and Russia and demonstrating incontrovertibly that it would be a good thing to do in this country, and the Government of the day deciding that it was not feasible, impossible and so on, and in fact not having it done until more than ten years later. It was perfectly feasible long before that and we discovered how silly we had been not to do it then only when the war came and our usual supplies of fuel were cut down. I do not think that should lessen the pride we should take in what we did since 1946 but we should not be too silly about boasting that we were the first in the world to do it. In point of fact, we were a little bit slow off the mark.

The second point is that I should like to ask the Minister to make a comment on the rates charged for electricity in off peak hours. It is a technical problem which I do not pretend to understand. It seems to me that it is the interest of the Board to have the current consumed which is produced and which otherwise, presumably, largely goes to waste in the off peak hours. I am thinking in particular of the night storage method of using this current and I think the E.S.B. has been imaginative in bringing in the system of storage heating. In this, we have been a little ahead of many of our neighbours. I feel that in a way they are damaging themselves by charging a rate more than they need and consequently having rather less of this type of electricity used than could be used. It would seem to me to be both feasible and desirable to charge considerably less for electricity used at night time. It is produced after all for these storage heaters, in order to extend quite widely, as could be done, this very useful method of heating. I should like to know what the Minister feels about this, or if he knows upon what calculation the rates charged by the E.S.B. are based and whether it would not be in their interests further to encourage the use of this electricity by cutting its price.

I shall conclude by supporting what the Minister said about the E.S.B., its production, planning and so on. A good deal of the criticism to which the Minister and the Bill have been subjected is of a very niggling kind. We can be very proud of this development and I do not think it matters who started it or whether some sections of the political life criticised it from one angle or another years ago. The fact is that the production of electricity and its distribution are being done extremely well by this State company, in which we all can feel a legitimate pride. The Minister is to be complimented on his attitude towards the future supply of electricity and the praise he gives the company and its officials is highly deserved.

Mr. Brady

I should like to endorse everything that has been said by Senator O'Grady in connection with the rates on the Shannon Scheme. I was a member of the County Council in Clare when the E.S.B. derated their undertakings in the county and when they took over the lands which extended from Ardnacrusha down to Whitegate, a distance of approximately 30 miles. It was a great national undertaking and, like Senator Sheehy Skeffington, I am proud of its success. I see a great future for the E.S.B. but at the same time, I believe that to deprive the Clare County Council of the rates on that undertaking since 1927 was a grave injustice. That matter has been raised on several occasions by Clare County Council. Resolutions have been sent to the Minister for Industry and Commerce, to the Government, to various bodies, and to Deputies, asking them to take it up, but with no effect. That is now almost 33 years ago. We believe that the State should pay rates on the Shannon Scheme undertaking, just as Shannon Airport is paying rates.

I should also like to endorse what Senator Hogan said about people in small pockets in the rural areas. I know of a case where the E.S.B. were carrying out rural electrification in the area of a particular farmer. He was slightly removed from their line of action and they wanted him to pay £120 for the erection of two poles to bring the supply up to his house. In addition, he would have had to pay for the wiring of the house. He was quite agreeable to pay a sum in the region of £20 or £30 but he could not afford to pay £120. Now that man sees no hope of getting lighting for his home, for his cow house or power for his kettle in the morning, if he is going to a fair, amenities which his neighbours enjoy. We have a lot of remote pockets in County Clare, north, south, east and west, and we should try to keep these people on the land. The best way to do that is to give them the same amenities as the people who live quite convenient to the big towns and villages have.

That is all I have to say except to add that I feel that I would have been lacking in my duty if I did not mention these points. Senator O'Grady said: "If they gave you £60,000 in a lump sum would you be satisfied?" and I replied: "If they gave us that lump sum and agreed to pay rates for the future, we would be quite satisfied."

Mr. Donegan

I rise to refer to one facet of the activities of the E.S.B. and that is their sale of appliances in competition with traders and the providing of services such as wiring in competition with the ordinary electrical firms and such like. I feel that a Government body providing a service and charging a price for it should not do that. Before proceeding any further with criticism, I give the obvious answer. In 1960, there are several hundred people, almost a thousand people, in the employment of the E.S.B. who are actively engaged in that end of the business. They cannot now be disemployed but I would suggest to the Minister that any expansion of that side of the Board's activity would, in fact, be unfair to the ordinary individual citizen who happens to be an electrical contractor or a supplier of electrical equipment such as washing machines, refrigerators and other similar goods.

The question was raised of rates not being paid in Clare. That is merely one part of the Electricity Supply Board's privileges. Where that obtains, it gives an idea of the advantage that a Government body holds. A Government body holds that advantage over the ordinary trader and they can utilise the advantages to suit themselves. Take the position of a man supplying a machine on the instalment system in the ordinary way. He must write into his costs of that machine the risk of his repayments not being made, the risk of his not being in a position to repossess the machine. The risk of the E.S.B. in that case is far less. It is lessened by the fact that the E.S.B. can switch you off.

The position is that when the refrigerator or the similar appliance is supplied, the additional cost of the instalments on that appliance is added to the nine weekly payments the householder makes. If those payments are not kept up, in the most arbitrary way the E.S.B. employees can turn off the supply of current. As I see it, that places the E.S.B. in a far better position, as far as the sale of such appliance is concerned, than the ordinary trader.

With regard to the question of wiring by the E.S.B., the E.S.B. people can avail of bulk buying because they are backed by unlimited capital. We are increasing the capital tonight. Is it not true that they can buy whatever quantities of various expensive cables they require so as to get the cheapest price? No individual firm can compete with that, but at the same time each individual firm must pay trade union wages, its rates and taxes. May I emphasise that? They have to compete with the E.S.B. with all these advantages.

May I make this analogy? When you had the practice of assessing the profits the flour mills were allowed during the war, the average losses of all the publicly-owned flour mills were taken into account. Having made these good, a figure of 6 per cent. was added for profit. I am making a case in this particular situation whereby I said that in the case of one mill——

Acting Chairman (Professor Stanford)

The Senator may not pursue that here; he may make an analogy.

Mr. Donegan

I will come to the end of the analogy. In this case, there was a huge garage into which went 50 vehicles. It was hard to decide which one was on bakery and which one was on flour. The E.S.B. has huge vehicles. Which one of these vehicles is engaged on a particular day on work relating to the price per unit charge and which as related to business? Similarly, when we take the turnover off the sale and the service and on business in relation to the turnover on the supply of electricity, one is a minute fraction of the other. When all the costs are taken into account at the end of the year, it is quite easy perhaps to charge over 10 years a fraction of a penny more per unit so that, in fact, the unfortunate trader in the towns in Ireland, who was there before the E.S.B. started, can be put completely out of business by this sort of activity. Nobody's business should be placed in jeopardy because of our wrong policy in the past. I feel it would be quite wrong if in the provincial towns of Ireland you had a situation in which the E.S.B. shop or the E.S.B. office to which everybody must go to transact his normal business with the E.S.B. in another way was selling at cutthroat prices while the man around the corner, rearing his children and paying his taxes, is forced out of business.

I would recommend to the Minister that that end of the business, while it should not be interfered with, should not be further expanded. I think that is not a very flamboyant approach. It is not a very radical approach. I think it is very fair. It would be wrong if we passed legislation tonight authorising further borrowing by the E.S.B. on a colossal scale, if, at the same time, we did not advert to the fact that there are around the corner from every E.S.B. office unfortunate men engaged in business, men with families to rear, who must compete with that huge organisation which has all the advantages and none of the disadvantages of that end of the trade.

Mr. Burke

I should like to support Senator Donegan in what he said in relation to the selling of fittings and appliances. I should like, however, to go very much further. When these Electricity Acts came in in 1927—and even the later Acts—they did not envisage retail trading by the E.S.B. The powers given to the Board were given for the purpose of allowing this great State organisation to perform a function which it might be very difficult for the private section of the community to undertake. But in recent years the policy of the E.S.B. has been to compete vigorously with local traders. I have seen a case where the E.S.B. went so far as to purchase a shop three or four doors from an excellently equipped electrical sales shop. In order to entice customers, infra-red heating strips were placed above the windows so that potential customers could warm themselves on winter's nights at our expense. I do not think there was any suggestion by the E.S.B. that the same free service would be supplied to the local trader further up the street. It is a very sound social principle that the State ought not to engage in anything that can be well done by the local trader.

Manufacturers of goods and wholesalers very often hire or procure shop windows or show rooms to exhibit and promote the sale of their goods and wares. I suggest the Minister is proceeding along the wrong lines if he does not use these shops for that purpose rather than for retail sales.

In every electricity bill we receive, a blurb is enclosed inviting us to buy on cheap terms some of the appliances the E.S.B. wish to sell—I suppose to boost the sales of electricity. They have the finance to enable them to sell on the hire purchase system. They have a method of collecting money that is not available to any of the competing traders.

I think we are surrendering some of our rights in handing over this retail trading to the E.S.B. I see shops being opened in every town and I say: "There is another infringement on the rights of the people. There is another yard in the progress along the road to serfdom." The Minister and his officials ought to know better than, little by little, to build a road to serfdom where independent people who have engaged in retail trading, who have given a good service to the community, will be destroyed. To use a semi-State company for that purpose is irresponsible.

The Minister for Transport and Power is the first Minister of that designation. He has more time to devote to this matter than had our Ministers for Industry and Commerce. He should see to it that we will encourage our people to be economically free, independent and self-reliant. How can people be independent and self-reliant unless they have some economic independence? If we use State companies to destroy their economic independence, we are travelling very much along the wrong lines. I understand that much the same principle is adopted in contracting. There may have been some excuse for that in the past and I would say less in the present.

I should like to see the withering away of this State control and the same applies to contracting. Where contractors have grown up, the E.S.B. should withdraw when the citizens are able to perform these functions themselves without relying on the State. That will help us to grow up. It is not necessary at all times and for ever that there should be somebody to hold our hands while we cross the street and that there should be somebody to switch on the light for us and to switch it off again. We have gone much further in these respects than we should have gone. We have shown an extraordinary lack of philosophy and thought as to where we are going. They say that nobody goes as far as the person who does not know where he is going. We must have the lights turned off when we are drawing up the laws with regard to the E.S.B.

I admire much of the great work this great body have done. In many respects, they have been an admirable organisation. No matter how admirable a State organisation may be, it must be subject to criticism and, like all of us, by examination and vigilance be brought back to the right lines. They publish a report each year. It is as attractive as one of the glossy covered magazines. One likes to browse through it, to read of the achievements and to look at pictures of what has been done. It tends to make one feel better.

I look in vain through the pages of that annual report to see if the cost of electricity is cheaper in Dublin than it is in Bristol, or if the man running a factory here is paying more for his lighting than his opposite number is paying in Dusseldorf, Haarlem, Utrecht or any other place. None of that information is available. I consider it ought to be a basic feature of any report. There is no mention of comparative achievement. I do not wish to be critical but praise is in some measure self-praise when it is not backed by an exposition of what is done by other countries in the field of public lighting.

It has recently been brought to my attention by a member of a public body that he believes that the cost of public lighting in comparable cities and towns in our neighbouring island is cheaper than it is here. I understand that many public bodies would now like to know how their charges compare with those in similar sized towns in Britain and elsewhere. We ought to be given this information. It ought to be readily available. Without it, we are uninformed. No democracy can survive if it is an uninformed democracy. The basis and strength of a democracy is to be informed and supported by information and equipment. The breath of enlightenment ought to be let into every institution in this State. The E.S.B. should tell us what everybody else is told. We should know whether they can do less or more than similar bodies elsewhere. If we have that knowledge, we shall be armed with the facts.

Mr. Murphy

I did not intend to speak on this Bill but the contribution by the previous speaker has brought me to my feet. I cannot understand the argument that the E.S.B. should not be allowed to trade in electrical appliances or to take part in contract work. I could understand and agree with the argument if it were shown or even suggested that the E.S.B. is subsidising this retail trade out of the sale of electricity—in other words, that out of the monopoly we have given them for the sale of electricity, they are utilising the profit to undercut the retail trade. That has not been suggested.

I have not the accounts before me, but I think the opposite is the case. In fact the profits the E.S.B. make on the sale of electrical appliances do to a certain extent subsidise the sale of electricity, so that if the argument is to be carried to its logical conclusion, the Board would not be allowed to engage in retail trade because they would make a profit; but of course they should be obliged to supply electricity because they might be able to make a profit, and they should be obliged to go into all those out of the way pockets we have heard about to supply electricity to the people who might want it. I do not see any people on my left jumping to the rescue of those out of the way pockets and suggesting that some private enterprise people should be allowed to supply electricity to those parts.

I could agree with the argument if it were shown that in fact out of the monopoly we have given the E.S.B., they are subsidising this other aspect of their trade, and if they were doing that, it would be unfair and should not be tolerated; but that is not the case. Instead it is suggested that the Board should withdraw from this field altogether and allow the other operators to sell, presumably at higher prices than the E.S.B. are selling currently, because the E.S.B. are in competition with them. Nobody obliges me or anybody else to go to them for an electric kettle or any other appliance except on the basis of what it will cost, the money aspect.

We have heard, of course, the suggestion that the Board are in a more favourable position in regard to hire purchase because it can be put on the electricity bill, whereas the private trader runs the risk of either having the washing machine returned to him or not being able to recover it. My knowledge of hire purchase trading, the little I have, is that the ordinary shopkeepers do not carry the risk at all. It is borne by one of the finance companies. You sign a form and from there on the trader is paid by the finance company, the risk, if any, being borne by the finance company. I cannot therefore accept that that arrangement is in any way unfair to the private traders.

The private traders have a useful function to perform in the selling and installation of electricity and electrical appliances, but I certainly would not support and could not accept silently the view that the E.S.B. should be forced out of this field in order to allow people to charge more, presumably, and because they might be making money, and because of that fact they might be able to eventually supply all those out of the way pockets which other Senators have been talking about.

Mr. Childers

Generally, I am able to say in the case of a debate in this House that it has taken place in a friendly atmosphere, but I am afraid that I cannot say it with regard to some remarks made on this Bill. I charge the Fine Gael Party with using the deliberate weapon of propaganda by rumour particularly when they see a general election coming in the offing, of quiet sabotage, little suggestions sent out on all sides that there is something terribly wrong with the State companies, little suggestions that the Minister is making gross misuse of inaccurate figures even though they are supplied by the State company, in order to prevent the public from knowing of huge loss, or losses, suggesting that some alleged juggernaut is rolling over the people and preventing them from having their due prosperity.

Mr. O'Quigley

It is on the records of this House that every time we have discussed a Bill dealing with the Electricity Supply Board, I have protested against its trading practices.

Acting Chairman

I do not think the Minister should be interrupted, except on a point of order or personal explanation.

Mr. Childers

We know that it will go on right up to the general election and that every attempt will be made to suggest that——

Mr. Donegan

On a point of order, I submit that this is not relevant.

Acting Chairman

That is for me to judge. The Minister may continue.

Mr. Childers

We have seen a good example of it in this case. I have said on a number of occasions that in the plan for the future of the E.S.B., no excess capacity is foreshadowed, that in relation to the present generating stations of the Board, there has been no concealment of alleged past excess capacity that was the result of a fraudulent plan by my predecessor. I make that statement again expressly. I have been supplied with figures by the Board whose chairman has my confidence, which showed that every single station at one time or another of the year is working at 100 per cent. capacity; and I have indicated again in the Dáil that there are periods of the year, particularly in the autumn season, when sometimes there is an insufficiency of hydro-production and when all the steam stations of the Board at once are working at 100 per cent. capacity in order to provide sufficient power.

There can be most extraordinary circumstances in which shortages of peat and water fuel occur in an unusual pattern where again the spare capacity is put into full operation. Every generating station has to be closed down for maintenance and that amounts sometimes to a very considerable percentage of the power cut off. I have said all that and made those statements explicitly, and I think what I have said should be accepted.

Senator O'Donovan suggested that in 1954 he made some observations to the effect that the increase taking place every year in consumption was quite out of reality. In fact, an increase of between 12 and 13 per cent. has taken place in the years previous to 1956, and it was the crisis of that period which reduced the increase in consumption. I am glad to say that the increase of consumption is mounting up again.

In regard to the observations made by a number of Senators about the practice of the E.S.B. in selling equipment, I should say, first of all, that I have not had any complaints of note or representations by the traders concerned that they object to the practice of the Board, and there has been no pressure of any kind, in that regard. Secondly, the E.S.B. enable small firms to collect their instalments through the Board's account. Thirdly, the E.S.B. by adopting the modern technique of having colourful showrooms, help the sale of equipment by the other smaller retailers who cannot afford that kind of overhead expense.

There has been a certain amount of reckless exaggeration in regard to this. I can say that if the Board were to invade the whole territory of the private trader, there would be serious complaints and I should naturally have to review the whole position, but at the moment, so far as I have been informed and know, they are carrying out their obligations and there is no element of subsidy. Their merchandise accounts are presented and can be found in the report of the Board. I should also add that a consumer cannot be cut off by the Board for nonpayment of hire purchase instalments. My answer to that point is that at the moment I see no reason to interfere. If ever some distortion of the position should arise, naturally that would call for examination.

I omitted to say in relation to the alleged excess capacity in the E.S.B., that naturally the E.S.B. have made every effort, in co-operation with Bord na Móna, to reduce the amount of spare capacity required. Bord na Móna have decided to have a stockpile of turf to tide them over a bad year, so that if there are insufficient supplies one year, there will be a reserve to enable the generation of current from turf to continue at a fairly high level whenever the year itself has been a very poor one.

Another suggestion was made that Bord na Móna might go into the manufacture of equipment. One of the first things I did when I was appointed Minister was to ask the E.S.B. to examine once again the equipment imported into the country, and also the normal standard spare parts for existing equipment imported into the country, to see whether they could give advice to the manufacturers who are producing similar sorts of articles in order to help them to produce them in this country. From speaking with the directors of a number of concerns, I know that the E.S.B. have been extremely helpful in that regard. On the whole, unless the E.S.B. can find a proposition in which they could take part on a more economic basis than any private firm, it would be as well to leave the position as it is. In fact, I think it would require legislation if the E.S.B. were to go actively into the manufacture of certain classes of equipment.

Senator Quinlan suggested that we were not doing enough in the electronics field. I want to mention in passing that we export radios to countries as far away as Pakistan and Ceylon and telecommunication equipment manufactured in this country to other countries all over the world, so although we may not have gone as far as we would have liked, there has been considerable progress in that direction.

Senator Quinlan also suggested that it might be time to appoint a commission to examine the work of the E.S.B. I am in very close touch with the chairman, in whom I have the utmost confidence, and with the directors. We meet regularly and discuss every phase of the work of the E.S.B. without any interfering in the conduct of the day-to-day operations of the Board. I discuss with them all the future trends which are likely to arise in regard to generation and consumption, and I press upon the chairman at all times the necessity for adopting the most modern techniques and engaging in work study of the most modern and efficient type.

I know the E.S.B. are in touch with engineers from a number of different countries versed in all the latest techniques. In deciding which equipment to select, they are automatically bound to make a study of new trends in design. If I thought for a moment that the E.S.B. were seriously lagging in adopting modern concepts and modern techniques in relation to the generation of power, I would certainly have no hesitation in asking the Board to accept the services of an independent consultant or consultants. That would be my duty. To my mind, there is no necessity for that, so long as I have the assurance of the chairman and the Board that they are adopting work study of the most modern type and keeping in touch, as I have said, with developments all over the world.

In relation to Bord na Móna, I should say that there are about 6,000 employees at the moment and that number will increase by 1,000 as I mentioned in connection with the observations I made in regard to the cost of electricity. I should say that the actual comparative costs show that milled peat is competing very satisfactorily with coal and oil and offers great hope for the future. It is true that sod peat is not able to compete in regard to comparative costs, but the milled peat stations are truly competitive. It should not be thought that our generating costs are excessive because of the use of peat.

A number of questions were asked about E.S.B. property being exempt from rates. I am sorry to have to tell Senators—I sympathise with them in some ways—that successive Governments have failed in their intention or wish to repeal the clause in the E.S.B. Act of 1927 which relieves them from the responsibility of paying rates on any of their property.

Mr. Donegan

It is your job now.

Mr. Childers

That is something one could argue. Some Senators raised the question of the small pocket of consumers who have not been supplied with power and said it would be very desirable now to make a change in the system which would enable them to have current, without additional charge. The position is quite difficult to describe in that regard. Roughly speaking, the E.S.B. must have a very rigid system of not allowing themselves to run into debt and to cause deficits over and above a certain specific figure. In relation to current supplied in rural districts, after allowance is made for the subsidy, a special charge is made if the normal fixed charge in respect of a particular dwelling does not provide 4.25 per cent. of the capital cost. The special charge which is added to the two-monthly bill brings the figure up to 4.25 per cent. I should say in that connection that, as must be known to Senators, the E.S.B. are subsidised to the tune of half the capital cost of rural electrification. The Board also make their own contribution to the capital cost.

That figure of 4.25 per cent. is grossly inadequate even after the subsidy has been applied so that there is a very heavy deficit in the rural electrification account. Briefly, if the E.S.B. were not to make a supplemental charge for those living in these pockets all over the country, there would be an immediate increase in the total deficit, if all the persons concerned joined the network, of anything up to £600,000 or £700,000 a year.

The best thing to do, in my belief, is to allow the E.S.B. to continue charging in an orderly way at the lowest possible cost, directing their construction teams in a manner which will ensure that the cost of installation in each area is as low as possible and allow them to complete the present scheme. The Government will examine the position and if it is possible to undertake a further scheme in which there might be some amendment of the present scale of charges, this will be considered.

I should make it clear that the Taoiseach, when he first announced the rural electrification scheme, clarified the position by saying there would be certain consumers who might never get current. It might be less expensive on them to get calor gas or Kosangas or some other gas fuel as an alternative. The position could easily be reached that the capital cost of providing the supply would be greater in many cases than the entire valuation of the household in question. Therefore, the answer is not to impose any further burden on the taxpayer or on the E.S.B. consumer by attempting to reduce these charges—which are made on an absolutely scientific basis —but to bring the present scheme to a conclusion, with all the areas connected, and then to re-examine the position and see what can be done.

Senator Sheehy Skeffington asked whether I had made an investigation of the charge system of the E.S.B. with a view to encouraging the consumption of power in off peak periods. The Board has a supply tariff for industries under which very favourable terms are offered and have the effect of keeping down the peak period when the consumer demand is at a maximum. I have impressed upon the chairman that everything possible should be done to examine the tariff with a view to making sure that they will not either inhibit new industries or sell less current than they could because they are making unnecessarily high charges. They should constantly examine the whole structure of the charges whenever they think it is possible to sell more current and at the same time, carry out their obligations under the Act, discharge their financial obligations, and if they make any profit plough back the whole proceeds into the development of the concern.

Senator Burke asked me about the comparative costs for power in different countries. Comparisons are very difficult indeed to make because, for example, this country has a greater proportion of its population in scattered groups of less than 200 persons than any other country, along with Sweden. Of course if you were to compare the costs of current here with those of Sweden, you immediately see that Sweden has a great spine of mountains and a very high proportion of its power is derived from water. Therefore, comparison becomes impossible. If you try to compare the position in Great Britain there is an enormous and extended three shift industrial complex to be supplied and the power is largely derived from either coal or oil and so comparison is difficult in that case. I think I could say that I am satisfied that the cost of power here is reasonable and that if we examine the increases in cost over a period of nine or ten years, or longer, as compared with those in other countries, there is every reason to believe that the E.S.B. operates efficiently. I should say also that the cost of installing the rural electrification net work here is regarded by engineers in other countries as being extremely low. Recently engineers have been visiting the E.S.B. to examine their methods of rural installation because of the low costs. In general, I think we can say that it is most unlikely that the cost of current here is excessive.

I think I have answered all the points raised except that Senator O'Quigley did refer to the section dealing with the increase in pensions. It is a perfectly normal matter. The sections, of course, are complicated, but they are, in effect, giving to the employees of the E.S.B. the increases extended to the Civil Service. No one is being omitted and it is working on absolutely parallel lines. There are no anomalies and no unusual factors in the proposed increases.

Question put and agreed to.

Committee Stage ordered for Wednesday, 14th December, 1960.

The Seanad adjourned at 9.55 p.m. until 3 p.m. on Wednesday 7th December, 1960.

Seanad Éireann debate - Wednesday, 30 Nov 1960