Seanad Éireann debate -
Wednesday, 31 May 1978

Vol. 89 No. 4

White Paper on National Development: Motion (Resumed).

Debate resumed on the following motion:

That Seanad Éireann takes note of the Government's White Paper on National Development, 1977-1980.

—(Senator E. Ryan).

Professor Murphy

When on the Order of Business last week Senator Ryan proposed that we would not meet on Thursday because the Minister for Economic Planning and Development would not be present, it was agreed universally that there would not be much point in continuing the discussion without the Minister being present; indeed, Senator Ryan himself stressed that point. With respect to the Minister of State, I think it is a great pity that the order of priorities of the Minister for Economic Planning and Development does not allow him to be present in this House today. It puts into perspective the attitude of the Government to this Chamber.

Last week I was asking three fundamental questions about the White Paper — how many jobs the Government proposed to deliver, to whom they entrusted that awesome task, and how had the trustees to whom the task is so entrusted performed in the past? I made the point, among other things, that it is now very difficult for us to judge whether or not Fianna Fáil will deliver on the manifesto and the White Paper since their criteria seem to be changing all the time. Particularly, I made the point that since we are not to look to the live register for a change in the pattern of employment it is very difficult to know where we should look.

I answered the second question, namely, to whom the Government propose to entrust the task of creating 75,000 jobs by 1980, by unequivocally saying "the private sector". I had got to the point, which was perhaps an aside, but nonetheless an interesting aside, that the gentlemen of the private sector must have been very encouraged by the utterances of Senator Whitaker here two weeks ago. Contrary to the impression given by the media and contrary to my own initial impressions in this House, it is quite clear that Senator Whitaker identifies himself with the spirit of the Government's socio-economic philosophy. The differences he has with them are now, more and more, revealed as purely differences on budgeting, keeping a proper ledger account, so to speak, book-keeping in respect of the minutiae of fiscal policy. According as the Government come to stress the need for more economies and restrictions on borrowing, that identification of interest between Senator Whitaker and the Government will come to be complete. In fact, two weeks ago here we had an illustration of the beginnings of rapprochement, as in a lover's tiff. The Senator, like a stern and kindly headmaster, smiled gently at and, in turn, evoked bashful grins from the head boy at the Minister's desk and the prefects on the Fianna Fáil front benches.

However, that is an aside. What is more important is that Senator Whitaker should be calling for restraint in wages, and public works for the able-bodied but workless Irish kaffirs, without ever averting to the need for dividend restraint, for the taxation of excessive bank profits, or without calling for a more equitable levying of income tax. If the workers are constantly being urged to show restraint, they might be encouraged by firm Government moves to tax not only the farmers but the wealthy professional self-employed and thus substantially reduce the tax burden on the PAYE workers.

How has the private sector responded to date to the awesome task entrusted to it in the White Paper? Well, I think you will agree, with a remarkable lack of enthusiasm. Spokesmen for the private sector in recent months have made it clear that they do not want to be the "fall guys" when the strategy of the White Paper proves to be a failure. Faced with the crushing weight of job creation which the Minister, Deputy O'Donoghue, is now winching into place, the Federated Union of Employers have made noises of noble renunciation. Some time ago one of their spokesmen made it clear that they would not carry Fianna Fáil's cross for Ireland, explaining that the FUE might be the scapegoats if the job targets were not reached, the clear inference here being that the private sector would not reach the targets.

In this connection I would refer Senators to the 4 May 1978 issue of Business and Finance, page 7, where a survey of 32 Irish chief executives discloses and I quote:

...the almost universal conviction that the jobs target for 1978 will not be met.

It is the opinion of Dr. Charles McCarthy—who, I am sure the House will agree, is an independent observer — as reported in the Cork Examiner of 16 May 1978, that unemployment is unlikely to fall below 100,000 in the next seven or eight years. Yet it is the private sector that has been singled out in this gamble. The word is not mine but the Government's, this gamble to deliver the 75,000 jobs on which the present Government fought an election and which they promise in this White Paper to deliver. But, lo and behold, the private sector will not serve.

This brings me on to my third question: how has the private sector discharged its stewardship in the past? That question may seem an academic one since the stewards are already giving in their notice but I am going to pursue it in any case since I want recorded on the Official Report of this House the fact that not only will the private sector not now deliver but it never did deliver.

Senators Jago and Lambert, in their apologia pro rebus suis here last week gallantly attempted to explain away the poor performance of the private sector in the past. I have more than once drawn attention in this House to that poor performance. Now I am going to be more specific. The figures are eloquent. In the best year of the boom decade of the sixties the private sector created 7,000 new jobs and that was in 1968-69. But over the seven years 1971-77 the net average increase in manufacturing employment was fewer than 300 workers per year— little wonder that spokesmen for the private sector are already throwing in the towel.

This gambling Government have placed the future of our youth and our potential for expansion on a horse that stumbled in the fifties, was finally dragged to the winning post and a photo finish with history only by the IDA and the multinationals who rescued this incompetent nag from the political and social consequences of its own ineptitude. Now in 1978 this spavined old horse of the private sector, despite being coaxed by budget sugar cubes, refuses to leave the stable for the big race but is quite willing to devour the surplus oats provided.

Historically, then, the private sector—which has been given carte blanche in this White Paper and which has always been allowed to dominate our economy — has never delivered anything within an ass's screech of that 4 per cent unemployment which is the conventional definition of full employment in western democracies. Now, over the past few months the captains of a very leaky industry have been saying in divers tongues: “Leave us with our profits, our beef bonanzas and our retarded but money-spinning industrial and agricultural structures, but do not ask us to create the jobs that Fianna Fáil promised to create.” After all why should they care — although Senator Brennan is keenly aware that the Fianna Fáil grass roots will care greatly—why should the gentlemen of the private sector care as they watch the Government hurtle towards the abyss of economic failure? When the gamble fails they will not be around the labour exchanges or the pool halls putting down the day. They will take good care not to be around the streets when economic ruin is followed by social and political collapse.

There is, of course, an alternative to the policies of this White Paper. Senator Whitaker complained that there was no alternative scenario in the White Paper, though he meant that only in the sense of no planning for unfavourable contingencies. Senator Brennan dismissed the critics of the White Paper, looking across at the Opposition benches and scornfully asking them what was their alternative. It is a consideration of the alternative, as I see it, that takes up the remainder of my speech. I do not expect Senator Brennan to consider that alternative, at least not yet; pragmatist that he is and pragmatist that the party to which he belongs always has been, perhaps Senator Brennan will listen when he gets the message up from the country though it may then be too late for him. At any rate there is a horse that has not been given its head — a road down which we have ventured but a short distance, a road which has limitless horizons, which is not a cul-de-sac like the private sector, but which, up to now, has been strewn with obstacles we must remove. The public sector, and especially the great productive companies conjured up in the early years of this State, by governments with a desperate but accurate knowledge of social needs, are muzzled and chained. The great State companies, the ESB, Bord na Móna, Cómhlucht Siúicre Éireann, to name but three, are products of a political will and pragmatism transcending party boundaries, a native Irish experiment that owes nothing to doctrinaire statism or other ideology. They serve the Irish people well, they line no shareholders' pockets; they offer no haven for the speculator because they are creations of social need and they already occupy a high niche in the history of this State.

When we talk about the public sector it is very difficult for us to have a proper picture of what that implies because the propaganda against it is vicious, consistent and deadly. There is resentment against our public servants when they discharge their duties and particularly when any State company makes a profit—that has always aroused envy in the gombeen class. That persistent and insidious propaganda has obfuscated the real role of the public sector and has maligned its invaluable services to this country. It is regrettable that Government Ministers past and present should have unwittingly or otherwise lent themselves to this kind of shameless propaganda and yet the logic of this White Paper, with its pathetic dependence on the private sector, explains why Government Ministers should now incredibly be talking about the non-productive areas of the public sector which apparently include even housing. An unhappy example of governmental attitudes to the public sector was the egregious statement by the Minister for Finance in the National Coalition Government to the effect that every five people in the private sector were carrying—carrying mark you—— one public sector employee.

This speech was reported in The Irish Times of 14 October 1975. Civil servants expressed their resentment on that occasion and for some months afterwards but it is doubtful whether that expression of resentment negatived the unfortunate image being projected in that case by a Government Minister, of public servants as being drones and parasites.

In happy contrast Deputy Garret FitzGerald restored the prospective in his book State-Sponsored Bodies, published in 1963 in which he discusses the reasons for the setting up of State companies in page 15, and I quote:

...to maintain in existence a bankrupt, or virtually bankrupt, undertaking whose preservation is believed to be in the national interest, or alternatively, a desire to initiate an economic activity deemed necessary in the national interest but one which for one reason or another private enterprise has failed to inaugurate or to operate on a sufficiently extensive scale.

Obviously, this statement is all the more significant now that the author is Leader of the Opposition. In passing, may I express the hope that the Joint Oireachtas Committee, now about to be set up on semi-State companies, will not only critically scrutinise the working of these companies but consider how best they may continue — to quote Deputy FitzGerald—"to initiate activities deemed necessary in the national interest".

If I had the time I would like to spell out in fine detail what the public sector is, that positive print of the Irish body politic, in contrast to the vague and negative print of the private sector. Historically, the public sector is a grudging admission by successive Governments that the drive for private profits does not extend to nursing the sick, teaching the young, caring for human failures, supplying us with water, putting out fires, cutting our turf, providing our electricity, running our ships, 'planes, trains and buses, repairing our roads and planting flowers in our public parks. That is the public sector. In being allowed to creep forward, cringingly and apologetically, to fill the gaping holes of private enterprise it has given us an example of how the private greed and selfishness in our society might give way to a nobler vision, a picture of our people's future which is what the public sector is, as yet faint and undeveloped but unmistakably clear in outline.

Some people think of the public sector as civil servants, as social archetypes wearing fáinní. Of course, the public sector includes pure or administrative civil servants, local authority workers, health board workers, teachers, Army, gardaí, indeed including those who guard and serve Leinster House. It includes the workers in vocational education committees who, it must be remembered, have done so much to improve vital skills and have transmitted these skills to the private sector. It takes in the work, for example, of the Institute for Industrial Research and Standards and of An Foras Talúntais. The work of the latter led to the discovery of the Navan Mines and, characteristically, the fruits of its labours were taken over in exploitation for private gain.

But when we talk about the public sector we mean primarily the productive workers in the great State commercial and manufacturing companies whose names ring proudly in modern Irish history though the private sector would like to have us think of them as so many tolling bells. To give some example of how productive the public sector has been, I am going to quote figures which I have for the year 1975. In that year the workers of the ESB produced over 7,000 million units of electricity; the workers in Bord na Móna produced 900,000 tons of turf and processed 959,000 cubic metres of moss peat, a familiar sight in English markets. The very dust of our bogs has thus been worked up into wealth, jobs and comfort for our people.

In the same year, 1975, Cómhlucht Siúicre Éireann produced 174,000 tons of sugar; Irish Steel Holdings produced 107,000 tons of steel, or 96 tons per every worker employed. That vast productive apparatus, with its huge repository of financial, technical and human skill and creativity — encumbered by no share-out of profits and dividends — that is the productive public sector to which I would wish to see the task of full employment entrusted.

It is not through any idle fascination with statistics that I have gone through this table of production. I did it to drive home to the Seanad, and to the public at large, that the public sector has been slighted in this White Paper, that they should not be so slighted, that they should not be generally abused by being presented as a drag on progress, to be apologised for or, putting it another way, to be seen as a kind of gigantic public purse out of which it was sometimes, unfortunately, necessary to borrow money to prop up the private sector when, for some regrettable reason, the free market system did not behave in accordance with the pure models stored in the minds of our academic economists. But, of course, this model of a free market, working in the equilibrium of public competition, has never existed in the real world. It has conspicuously malfunctioned in the case of our economy every year since the foundation of the State. So then, for me, the public sector is not a primer for the private sector pump, to use a favourite image in Fianna Fáil economic strategy; it is a living bloc of skilled men and women charged by public policy with doing all the jobs, from nursing and teaching to producing turf and electricity, which the private sector could not be persuaded to do because it saw no prospect of ripping off anybody in the process.

Here, I should add, that whenever the private sector sees a productive State company it immediately raises a sordid agitation to take it over and cash in on the hard work done by the men and women who built it up. There are examples all round us of this deplorable and unprincipled tendency of the private sector to encroach on the public good. I would instance the cynical campaign of the IFA to take over the cut-away bogs developed by Bord na Móna and the breaking of contracts in beet and potatoes by IFA farmers in the case of Mallow some years ago and in Tuam only last month.

The Tuam problem was brazenly laid at the door of two State companies, CIE and Cómhlucht Siúicre Éireann when, of course, its origins lay in the refusal of the potato contractors to honour their contracts. There is again the private road hauliers' campaign to take over profitable road haulage from CIE leaving the burden of regular and unprofitable, but socially vital, bus services on the shoulders of the public transport company. Or let us also consider the way in which the ESB is inhibited from controlling the retail market of electrical goods when it is obliged to keep pockets free for fly-by-night profiteers like Cannon Electric. I would instance also the refusal to allow RTE to control the renting and distribution of television sets and so help reduce rentals and costs. I would remind Senators that five out of the six television rental companies are British-controlled. There is also the sale of CIE's valuable engineering works at Inchicore to Van Hool which repays the compliment by throwing men out of work and thus back on CIE's lap. The Irish Sugar Company has been inhibited from developing an autonomous and integrated farm machinery manufacturing industry, which could play a vital role in the growing mechanisation of Irish agriculture. Instead, farmers last year imported £74 million worth of machinery which not only adds to the balance of payments deficit but is totally avoidable because the Sugar Company could, given the targets, substitute home-production for many of these imported goods and lay the basis for a heavy machinery industry in conjunction with the engineering works of CIE, the research and workshops of Bord na Móna and the metals experience of Irish Steel.

Perhaps the seamiest example of the way in which the private sector tries to encroach on the public good is the spurious and obscene campaign in recent months on the part of pirate radio stations to be given a licence to collect money. It is spurious in that big business is blatantly exploiting youth in order to secure a licence to print money. It is obscene in its hypocritical pretence that it is in the public interest to oppose RTE. We should remember that the pirate sweat shops pay no trade union rates, have none of the sickness and social security schemes of the national broadcasting service, nor does this repellent branch of private enterprise have any professional, social or cultural commitment to the community. This is evident from the conspicuous absence of journalists, social commentators and the like. Indeed, as anybody who has listened to these commercial stations will have noticed, the absence of anything except wall-to-wall pop music, but if you listen carefully in between you will hear the heavy background breathing of financial avarice that is quite palpable.

Finally, I would instance our failure to allow the public sector to set up a meat-processing industry which the private sector fails to do except in a flimsy and unstable fashion. I would also instance the absence of a fish-processing industry, which the IFO have failed to create and which Bord Iascaigh Mhara are prevented from creating and the failure to allow the Department of Lands to embark upon a vast afforestation programme by compulsory purchase of poor and unworked land — in a sentence, the list of private obstruction of the public good is endless and successive Governments have connived at it. I cannot resist citing one more example because of its strategic importance. Over 80 per cent of the finance in the construction industry is provided out of public funds. Yet 24 per cent only of the work force is employed in the public sector. Who are the 24 per cent? They are the vital public sector workers who lay down the roads and infrastructures that give access to the tatty, tawdry and highly profitable private houses thrown up by the private sector builders, the vertebrae of the present Government's economic and social support.

In sum, therefore, I am proposing in no narrow ideological spirit that the public sector is eminently fitted for the task of achieving full employment—that would be the message of my White Paper. Instead of pouring in millions of pounds in grants to prop up the ailing private sector, let the money be spent on expanding and developing the manufacturing and production arms of the existing State companies.

Let the ESB, CIE, Bord na Móna, the Irish Sugar Company, be charged with specific job targets in energy, plastics, transport, textiles and chemicals. Let there be a new State company for the construction industry—An Bord Tógála. Let there be an expansion of Bord Iascaigh Mhara into fishing with their boats crewed by young men and women enjoying public service conditions and with their fish being processed in State factories using the expertise and food technology of Cómhlucht Siúicre Éireann. Let the Sugar Company expand into the production of processed and packaged meat, dairy and vegetable products, to end the anarchy and scandal of a rancher cartel that exports jobs —symbolically in the form of carcases to the market places of Europe. Let CIE expand the backward metals and engineering industry in conjunction with the farm machinery developments pioneered by the Irish Sugar Company. In short, let the shackles on the productive energies of the State bodies be thrown off, and let there begin, to use a celebrated phrase: "the abundant flow of commodities".

By reliance in this White Paper on the private sector alone the Government have given a gratuitous insult to the great productive powerhouse in our economy. And yet it may not be too late for change given the political will on the part of an administration with the greatest electoral backing in our history as a State, with a Taoiseach who, if I may say so, has in effect carte blanche to make any radical new departures with the full sanction of the people, if only he had the requisite political will. There need not be any party political clash of forces in this matter of expanding our State companies, still less any cause for ideological qualms. Let Fianna Fáil, even at this late stage, build on the pragmatism of perhaps its greatest leader who brought Aer Lingus into being in 1936, Bord Fáilte in 1939, Bord na Móna in 1946—Seán Lemass. “Lemass, thou shouldst be living at this hour; Ireland hath need of thee.”

Fine Gael, too, might remember that William T. Cosgrave presided over the courageous and far-sighted decision to set up the Electricity Supply Board. It would be stupid and dishonest to pretend that the radical new departure I am suggesting would be unopposed. Of course it would be opposed, viciously opposed; any move to expand manufacturing in the State companies would meet with the same kind of opposition that the rancher troglodytes put forward to the Shannon scheme in the twenties. It would meet with opposition from the bankers and the tax dodgers, outraged at the prospect of profits going into the public purse instead of the private pocket. It would meet with opposition from the wealthy self-employed who would have to pay decent wages instead of figuring in the Department of Labour's list of defaulters.

Whatever the difficulties attending and the opposition facing the creation of an alternative socio-economic system we have no other choice short of revolution. Only by developing the public sector can we extend the "productive base of the economy", to quote the phrase used by the Minister towards the end of his opening speech here two weeks ago when he said and I quote:

To escape from this morass we must be prepared to mould events rather than simply respond to them.

That is a sentiment I heartily applaud but I find it ludicrously inappropriate when applied to this White Paper. The morass the Minister speaks of is, in my view, continuing dependence on the private sector.

Let me, in conclusion, fix the mind of Senators again on the essence of the dilemma. In the seven years from 1971 the net average increase in manufacturing employment was 300 jobs per year. To reach the targets of this White Paper the private sector would have to do not twice as well, not ten times as well but 50 times better than it has performed in this decade to date. "Morass" is right, "morass" is the mot juste. Whoever follows the gambler down the boggy road to disaster, I am going to take the high road and I suspect I will have goodly company at the next election.

Mr. E. Ryan

A great deal of comment has been made in the course of this debate both in this House and outside it on the alleged emphasis being given to the private sector in relation to the creation of jobs. Certainly Senator Murphy dealt with this in the most colourful and entertaining way. But the suggestion that the White Paper, or the Government, proposes to leave this problem entirely to the private sector is entirely wrong because the public quite obviously has a place too. On the other hand, the emphasis being put on the public sector by Senator Murphy has not been to any extent spelled out fully, although I must admit that Senator Murphy has made a better effort to do this than any other speaker I have heard in this House.

What in fact is being envisaged? Senator Murphy has painted a picture, one in which, if we were to believe him, we would have no problem at all; all we have to do is to hand over the question of jobs to the public sector and, hey presto, the whole problem would be solved in no time at all. Those who alleged that this matter should be left to the public sector are certainly not as extreme as Senator Murphy in the speech he has just made because although he has dealt with some of the ways in which the public sector could give more employment has certainly has not made a convincing case on how many extra jobs are going to be provided by the public sector; in what sphere, which bodies, and how will it add up to the kind of problem we have, to 75,000 jobs, or something in that vicinity. Does he, or those who advocate giving this job to the public sector, merely mean that CIE, Aer Lingus Teoranta, RTE or any of the other semi-State bodies should simply take on extra people and, in that way, make some effort to cure unemployment?

From a study of recent events and on records during the years, most people would take the view that these State bodies are already over-burdened with staff. To give them any more would merely make their problem even greater than it is at present, because to have any validity the argument for any of these bodies to take on extra staff must be to produce goods or services that are in demand, not to produce services or goods that are not required or that cannot be disposed of for which there is no demand. Otherwise, merely asking State bodies to take on extra people is just another form of dole.

Senator Murphy dealt in some detail with the various semi-State bodies that have been created during the years and referred to the fact that they were set up in different circumstances: some were set up because the business concerned was about to collapse, such as railways, and the State had no alternative but to step in; some were set up to start new industries such as airlines which no body in the country had sufficient funds to undertake on their own. Almost every one of the semi-State bodies was set up for different reasons in different circumstances, and, to be fair to them, with varying degrees of potential success.

Some of these semi-State bodies have performed well. Some have made profits, which is something Senator Murphy disapproves of, some have not done so well and some have been a dismal failure, but very often in circumstances where it was not the fault of those who were in charge of the body in question but because what they had been asked to do was almost a lost cause from the time they were asked to do it. This situation varies from State body to State body—and the number of State bodies in which it would be possible to take on extra people to give the kind of extra employment that is required in circumstances where it would be other than a dole is very limited.

Senator Murphy waved figures around. He talked about the potential of some of these bodies. If they have potential then nobody is stopping them availing of that potential. Many of them have availed of the opportunities. Some of them have expanded into other areas and some of them have taken on many extra staff in circumstances where they were able to produce goods or services with which to pay that staff. Where there was an opportunity, the more dynamic of these companies were able to avail of that opportunity and did avail of it and were successful in doing so. But to say that they were prevented from expanding, that they were deprived of the opportunity to do what they wanted, to expand in the way they wanted, is a complete distortion of the facts.

Of course some of them did want to do things from time to time which the Government of the day decided in their judgment not to allow them to do. In some cases the Government of the day did not stop them from what they wanted to do and the result of some of the expeditions of some of the semi-State bodies into areas which they thought they could branch out into successfully ended up in dismal failure and as being costly expeditions as far as the taxpayers were concerned. So the fact of the matter is that these semi-State bodies, most of which were created by Fianna Fáil and in almost all cases rightly created by Fianna Fáil, most of them encouraged by Fianna Fáil—I do not want for one moment to suggest that I disapprove of semi-State bodies or that I am critical of them in general; in general I am very much in favour of them—but to suggest that they can solve all our problems or to suggest that the only reason that they are not solving our problems is because they are being prevented by successive Governments, or prevented by the private sector, is just a fairy tale which nobody without the dedication and single-minded approach to the question of socialism that Senator Murphy has could believe.

If Senator Murphy really advocates that the semi-State bodies now existing or possibly to be created in the future should go into manufacturing in a big way, into the manufacturing of shoes and shirts and cookers and everything else, that is a point of view that should be spelled out clearly. Is this what is envisaged by those who expect the public sector to take up the slack that is required in regard to unemployment? Do they really mean that the Government should set up trading bodies to start manufacturing the goods which the private sector are manufacturing at the moment—to go into competition with these companies? If that is what is intended, it should be spelled out in detail so that the full ramifications can be examined by this House, the other House and by the public generally. If that is seriously intended, then that should be said.

But if not, then the opportunities for the semi-State bodies to expand, although they are there, are certainly not as wide or as advantageous or as attractive as has been suggested by Senator Murphy and by some of the other people who have been eloquent in describing what could be done by the public sector.

I do not believe that the public sector, semi-State bodies in general, are suitable for manufacturing, for going into the area which the entrepreneur handles at present. I believe that the kind of expertise, the kind of flair that is required for that, the balance between taking risks and making profits, is one which is not suitable to the public sector and one which they are at present in most cases very reluctant to undertake, in many cases because there is not incentive for them to do so. The kind of productivity, the essential effort to be competitive in regard to price and quality which are essential to producing goods for sale both at home and for export, are not in general to be found in the public sector, in the semi-State body. It is something which is understood and handled much more effectively by the entrepreneur.

This was pointed out very clearly in a short reference in this House last week when the Minister of State was introducing the motion on semi-State bodies. He said in the course of his speech, that although in organisational form these bodies have many similarities with private sector companies, there are real and fundamental differences. Complex economic and social issues were involved in their creation. The balance sheet may rule in private enterprise. It is only one of the yardsticks by which State-sponsored bodies should be judged. Yet if we were to assume too readily that the normal commercial criteria should not apply, the danger could arise, the social need could be advanced as the justification for any and every loss.

That sums up very clearly the difference between the approach to the private sector and the public sector and the reason why in general—and I say "in general" because there are exceptions to the rule—it would be inappropriate for the public sector to engage in ordinary manufacturing and not merely inappropriate but unlikely to succeed.

Extra jobs that have been projected in the private sector will arise from increased productivity, increased competitiveness in regard to price and quality which will result in demand for more goods and in turn for expanding new factories which will give the extra jobs that are required. But this is the way it must be done. It must be done in circumstances where there will be a demand for the goods that are manufactured and the services that are provided, and this demand will in turn result in expansion and further employment. To do it in any other way, to set up semi-State factories which would have their judgments and decisions clouded in the way in which the Minister referred to in his speech here last week would almost certainly end in failure for many of them, which of course in the end would mean those employed would no longer be employed and the problem we are trying to heal would be as bad as ever.

To suggest, as Senator Murphy has done, that the private sector are refusing to take on the job which they have been asked to do is quite wrong. They have some reservations as to whether the unemployment problem can be settled in one year, or as quickly as the Government hope it will be, but to suggest that they are disowning the opportunity which has been offered to them is quite wrong. The extent of the expansion of private industry, the fact that they are making more and more goods and exporting more goods, is the measure of the way in which they are rising to the opportunity which has been offered to them. We must continue to do that. We must identify the areas in which we have an advantage, in which we can make better and more competitive goods than other countries. We must concentrate on quality goods, on goods in which craftsmanship plays a large part. If we can succeed in doing that I have little doubt that the private sector will rise to the occasion, will produce more goods, will sell more goods, both abroad and at home, and will give many of the extra jobs that are required to solve the serious problem of unemployment.

We must also not lose sight of the opportunities present in the private sector, and possibly in the public sector, to provide not merely goods but new services and services in new areas, not only services at home such as tourism, finance, insurance and distribution, but services in developing countries, in the Middle East and in Africa. There are great opportunities in the construction industry, in engineering, in staffing hospitals, administration of hotels, in servicing airlines and dozens of different situations where staff are needed, where professional people with expertise are needed to set undertakings of that kind going, to help in training other people. Possibly in the long run their job will be done and they will have to seek other areas in which to do that, but for many years to come there are great opportunities in that sphere. We have a surplus of skilled personnel, many people with the kind of skills that are needed, who could do that kind of job and who could be of great benefit because in doing that, as far as the national economy is concerned, it is exactly the same and as beneficial as exporting goods. We have people with the skills to do that, and we have the advantage that in many countries in those areas Irish people would be acceptable and welcome where many citizens from other countries would not be. That is another area in which there is great opportunity which I feel certain will be availed of by the private sector and to some extent by the public sector.

In advocating that much of this problem of providing jobs should be given to the private sector I am not suggesting, and neither is the White Paper, that the public sector has not a role. It is quite wrong and being very blind to take the view that it is only the public sector, or the private sector, which will do this job. There is no reason at all to take the view that only one or the other will solve this problem. There is plenty of room for both and in my view both have a very important part to play. There are areas—the realisation of our natural resources, the expansion and sophistication of our infrastructure, areas in research and development, alternative sources of energy—in which the public sector can play a useful part both in providing jobs and expanding our economic potential. They are not the only areas I have already acknowledged that semi-State bodies, the existing ones and possibly a few extra ones, will have a part to play. They can expand, they can do new things, but one should keep in perspective the limit to which this can be done and certainly one should not take the view that this kind of expansion in the public sector can solve all our problems.

I should like to refer in relation to the question of energy to what the White Paper states at paragraph 523 on page 48:

In a world context the energy situation is changing rapidly to meet the challenge of recent price increases in fuels. New sources of energy and new technologies are emerging, providing more choices of action in energy policy. Within this framework, the Government tend to formulate a comprehensive national energy policy and strategy which will include the following aims: the optimum development of indigenous energy sources; access to secure supplies for imported energy sources; diversification of sources of energy supply; and the promotion of economy in the use of fuels.

The following paragraph deals with the question of nuclear power.

I sincerely hope that the suggestion set out in the preceding paragraph on the ways in which energy can be either produced or conserved will make a nuclear power station unnecessary. Apart from the many doubts and fears expressed by those who oppose nuclear power—and many people have their own views as to whether these fears are justified—what is most important in the context of this White Paper is that the development of other forms of energy such as wind, tide, solar energy, waves, would provide far more jobs at home in making the equipment required. In the case of a nuclear power station a great deal of the very large capital investment required would be invested in equipment from abroad.

If research into these other forms of energy succeeds in providing enough energy for our needs, then not only would it be very useful from that point of view, but it would go a long way towards providing extra employment at home. I understand that the ESB have told the Government that a final decision will not have to be made for something like three years, and if the same research is put into the question of alternative means of energy, and if the same amount of money, the same capital, is earmarked as that available for nuclear energy, then there is every chance that these other forms will produce the energy we need.

To get back to the question of opportunities for development, opportunities for providing jobs in the public sector, semi-State bodies, I have no doubt that there is great scope in that area which should be availed of, scope which I think will be availed of. What I am saying, as I said at the beginning, is that those who advocate the public sector as a method of dealing with this problem, either as being more important than the private sector or as being the only method of dealing with the problem of jobs, will have to be far more specific in their proposals. They will have to spell out in far greater detail exactly how all the jobs that are required, or most of them, can be provided in the way which they advocate without sufficient clarity.

Everyone concerned with the economic future of this country, as set out in the White Paper, must be concerned with the state of industrial relations, with the number of strikes, with the number of unofficial strikes. It would be difficult to quantify the damage that has been done to the national economy in the last few years by these strikes and, of course, in particular the damage being done by the recent Post Office and Aer Lingus strikes. There has been undoubtedly disruption of business. They have undoubtedly led to the holding up of exports and probably led to many lost orders, although the extent of that is impossible to estimate.

The most serious effect of those strikes is on our image as a base for new industry. Coming after the Ferenka débácle, our credibility must have suffered very much by those recent strikes. The only question is to what extent our credibility and our image have suffered. The prospect of providing an acceptable level of employment in the next three or four years has undoubtedly been diminished by those industrial disputes. If any more of them take place of the same type, the same order, the same extent, I have not a doubt that they will have a very serious effect on our prospects of economic revival.

I am afraid we have come to regard strikes as an inescapable fact of life, something that we will always have with us, a feature of our economy for which there is no remedy. This is the view of many people. For most people the most they hope for is that occasionally there will be a lull in the cycle of disputes, a breathing space in which some recovery can be made. There are, of course, those who would argue that industrial disputes and strikes are a feature of the capitalist system and that we will always have them until we embrace the cure-all principles of socialism. I will resist the temptation to comment on the fallacy of these arguments or on the pitfalls of that system: it is sufficient to say that if we were foolish enough to introduce it we would never again have an opportunity of even discussing whether we had done the right thing or not.

Strikes are not a necessary feature of the capitalist system. There have been many capitalist countries in the western world in the last 50 or 60 years in which the unions have obtained the maximum possible conditions without resorting to strikes and have managed to get conditions which are far better than countries in which strikes were resorted to as an almost day-to-day matter. If you compare West Germany in the last 25 years with the United Kingdom, they are a good example of two capitalist countries, in one of which there virtually have not been any strikes, with a very good result for the employees in that country, and another in which there have been many strikes with very lamentable results for the employees in industry in that country. But bad and all as the conditions have been in the countries where they have resorted to strikes on a day-to-day basis, even there they have far better conditions than employees in the socialist countries.

The circumstances which lead to industrial disputes and ultimately to strikes are complex, varied and almost impossible in many cases to anticipate. Lest it be thought that I am suggesting these factors are always the fault of one side or another, they are caused by both sides in industry. What I am concerned about is the approach to industrial disputes, and what I want to say is that it is not inevitable that they should always result in strikes. We will always have industrial disputes, and differences of opinion about what conditions should be, but the important thing is that these industrial disputes should not result in strikes. Of course, there is an answer, a way of ensuring that no matter what the problem is it can be resolved without a strike.

I am not about to produce some brilliant new means of dealing with industrial disputes. I am merely drawing attention to the fact that we have a Labour Court which has vast experience of industrial relations and has done a prodigious amount of good work since its inception. That court could resolve every industrial dispute if both parties were willing, as a matter of course, to accept its decision when every avenue of consultation and conciliation failed. This is something we can do—employers and employees—to help to solve many of the problems which have occurred in recent years. Those concerned in industrial relations should stop to consider the fact that in most civilised countries the only area in which the law of the jungle still prevails is in industrial relations. In all other spheres where disputes occur between citizens, groups of citizens, or between bodies of one kind or another, disputes about contracts, injuries, property or anything else, they are ultimately referred to a court of law if agreement is not found possible. All concerned accept the decision of the court and accept the rule of law whether they agree with it or not, whether they like the decision or not. That is the difference between the rule of law and the law of the jungle. It is only in industrial relations that we no longer have accepted the principle of the rule of law, of accepting the decision of a court.

I see little hope of resolving our economic problems in the years ahead unless there is a fundamental change of attitude in relation to the Labour Court, unless it is given a real chance to do its job and play its part. In this respect the unions have been more reluctant to accept this principle than employers. Most employers would be willing to accept the decision of the Labour Court where many unions are not prepared to do so.

No other contribution to our economic future could compare in importance to a decision by employers and employees in the years ahead to accept the Labour Court as the final adjudication of any problems they may have between them. If this were done, it would have an immense effect on our economic future.

I am happy to note in the White Paper that the Government:

do not accept the proposition that, because we are an extremely open trading nation, dependent to a large extent on the world economy, we can have little control over our economy.

That is in contrast to the National Coalition Government who again and again pleaded that the depression through which the country was going was due to circumstances outside their control and that, consequently, they could do nothing about it. We had the description by the then Minister for Finance of the economy being tossed around like a cork in a stormy ocean; nothing could be done about it.

I do not deny that for some of the years the National Coalition were in office there were difficult circumstances and that there were factors on the international scene which made life difficult, and on which our economy suffered. However, the difference between the Coalition and Fianna Fáil is that the Coalition took the view that they could do nothing about it, they had to accept it and they consequently were taking no blame for it. Fianna Fáil does not take that view. Fianna Fáil takes the view that we do not have to wait for the international market forces to revive our economy and start it moving in the right direction. The Government believe that with the support of the community they can do a great deal to shape the direction and development of our economy during the years ahead. The initiative can and must be taken by the Government to plan and create confidence. That is exactly what is being done in the White Paper and will be done in the other papers to follow.

The Government have already created a great deal of confidence here. The survey which was done in Business and Finance was referred to by Senator Murphy but he merely took the bad bits out of it and not the good bits. Virtually every single one of the managers and executives interviewed according to him expressed doubts about being able to solve unemployment but they said that there was a new confidence in the country, that there was new confidence in our economy and that they looked forward to a great expansion of industry in the years ahead. That is what is being done by the Government in giving confidence to the economy. The White Paper is the first step in the planning which will avail of and take advantage of that confidence. It will ensure that the economy will proceed in the right direction and will gradually build up in a constructive and progressive way to provide the jobs that are necessary.

Although the creation of jobs is the first target of the Government and it is a problem that is dealt with in particular in the White Paper it is by no means the ultimate or only aim of the Government. The aim of the Government is far more comprehensive than that. Their aim is to improve social services, improve and expand education, health and social welfare and improve in general the quality of life here. Jobs are a priority for many reasons because without a job a person cannot participate in expanding prosperity of the country. A person who has not a job is taking social welfare, is availing of social welfare rather than making a contribution to it. Where jobs are provided the people who are employed will be paying income tax and taxes which will enable our social welfare to expand. That will mean that those who are in need for one reason or another and who are unable to work can get increased social welfare. There will be more money to pay for all these problems, all the necessities of education, health and social welfare which must be dealt with as soon as possible.

Some of the views about the future of the economy which have been expressed here and elsewhere have been rather gloomy ones, but the economy is moving in the right direction. There are many factors at the moment which are extremely encouraging and which will ensure that the economy can expand in the future. The fact that inflation has gone down to its present level is very encouraging indeed and is something which is really essential to the success of the economy. Employment is going up and unemployment is reducing and this will improve as time goes on. The Government are confident that the targets which were set in the manifesto will be reached. I have no doubt that their confidence is well-founded.

We have a large and progressive agricultural base. Many people in the past bemoaned the fact that so much of our economy was dependent on agriculture. It is now seen to be a very solid and comfortable base which can lead to the expansion of the economy in many other ways and can form an anchor which will help to secure our economy. The industrial sector is expanding steadily and very impressively indeed. Our exports both of industrial goods and agricultural goods have been very impressive during the past year. Of course, over and above that we have what can certainly be described as an exciting potential in regard to our natural resources. Many of the essential pointers, many of the factors upon which a successful economy must be based and which will ensure the creation of full employment in the future, are already there. If the problem I have referred to, the problem of industrial relations, could be resolved I see no reason why the most optimistic projections of our economy should not be reached in the years ahead.

Mr. Alexis FitzGerald

I hope I will not be thought nasty or brutish if I open my comments on this debate by expressing the view that the White Paper is fatally flawed by the fact that the umbilical cord connecting it to what is described as the Government's election manifesto has not been cut. The flaw which results from the failure to cut this cord is that the starting point is wrongly and falsely described. The starting point, and one must have a starting point for any plan, is described in the opening words of paragraph 1 of the White Paper:

During the last few years, the Irish economy has tended to lose momentum.

Within weeks of the publication of the White Paper there appeared a document, issued by the Minister for Finance, from which I quote the following:

Last year the Irish economy was in the unusual but gratifying position of having the highest growth rate in the EEC and one of the highest in the OECD. National output grew by over 5 per cent, twice the EEC average and well above the OECD figure of 3½ per cent.

Last year was 1977. Were the decisions of the Government made after 5 July 1977?

An Cathaoirleach

Will the Senator give the source from which he is quoting?

Mr. Alexis FitzGerald

"Economic Background to the Budget 1978", which I think I already said was published by the Minister for Finance. I have already given the source.

Were any of the decisions made by the Government after taking office on 5 July 1977 responsible for a national output growth which was twice the EEC average? Was achieving a national output growth of twice the EEC average a case of the economy losing momentum? The same document states:

Consumer demand...rose by about 5 per cent in volume compared with an increase of 2¾ per cent in 1976. Investment ... rose by 8 per cent in volume last year. Activity in the building industry gathered momentum through the year ...

That was the year in which the economy was tending to lose momentum. That document further stated:

Exports: The volume of exports of goods and services rose by 11½ per cent in 1977. Industrial exports were again buoyant.

Figures issued by Bord Fáilte show that the total number of tourists increased by 10 per cent and that revenue rose by 27 per cent ...

Were the Government who took office on 5 July last responsible for these increases of 11½ per cent in exports, 5 per cent in consumer demand, 8 per cent in volume in investment, 10 per cent of the total number of tourists? The same document and this is also of importance, states:

The rate of price inflation abated significantly in 1977. The Consumer Price Index rose on average by 13½ per cent, compared with 18 per cent in 1976 and 21 per cent in 1975.

I hope I am not thought impolite in drawing attention to a bogus claim that is involved in the political party now in office claiming credit for favourable trends which had started long before they took office. Those trends have continued since they took office and I pray they will long continue.

What is important about this is— this is of importance not merely to the judgment of the people who are responsible for issuing the White Paper—that we in the political parties that comprise the Houses of the Oireachtas should engage in a process of self-criticism. It is important that we should realise that allowing untruths is not going to restore or make for the growth of the quality of life in Ireland, a phrase that may embrace anything that anyone wants to include in it. There is not going to be much quality in life in Ireland if the chosen representatives engage in a thoroughly unreal debate in which the parties out of office will, through well informed people, such as the Minister now present, make allegations against the party in office of responsibility for actions which they know perfectly well are untrue. That observation about the party now in office goes equally well for the parties put out of office. One of the important things to be done here—it can only be done by the leaders of political parties, by those influential in political parties—is to have debates about real matters for which Government are really responsible. We should have debates about failures which can be truly attributable to them; for choices they make that are real and for misapplication or whatever chosen application they make of resources that are available. If this is not done, neither this Government or any succeeding Government will achieve the best for the Irish people.

I should like to start with a proposition. I would have hoped to have seen some development of it in the White Paper which does not, admittedly, pretend to contain a plan but what is contained in the Paper as "a detailed plan". But just as I do not pretend to be making a good speech, I still pretend to be making a speech. Presumably the White Paper in saying it was not making a detailed plan was implying that it was making a plan but withdrawing itself from judgement as to the quality of the detail. The Government, in introducing the White Paper, are not going to succeed in serving the Irish people well unless they have the authority to do so, authority based upon their ability to see the truth and to communicate the truth. I do not believe—I think there is strong evidence to support that lack of belief—that the Minister present here is fooled by his own propaganda. The Minister, if I may be personal in his presence, is one of the cleverest things that has walked into public life, but cleverness is not all. I have seen a lot of highly skilled gentlemen operate in politics. I have seen the temptations before those men. I have seen some yield to these temptations and others not.

It is very dangerous for a man of great ability and cleverness to allow his talents to be used in what is tantamount to a mispresentation to the Irish people as to the situation which existed when they cast their votes in June of last year. I believe that there is evidence to be gathered from the Fianna Fáil manifesto, a document which has now uniquely almost become a State Paper, being referred to in a White Paper, that the Minister read the economic trends rather better than the advisers to the Government read these trends. He saw a horse running quite swiftly down the track. He dislodged the jockey and got on to that horse knowing perfectly well that that horse was going to go as fast as that horse was in fact going. That may be clever, but it is too clever by half. It is the kind of cleverness which gives rise to loss of confidence, and without confidence in the leaders of opinion, without confidence in the operators of our partisan system of parliamentary democracy, we are not going to achieve what the people may believe they want. For example, we are not going to achieve a cure for real unemployment. I am not talking about those inflated or deflated figures which have arisen in controversy. I know there is some real unemployment, of people really wanting work and unable to get it. To be in that state seems to me to be a social problem equivalent to having people in prison unjustly. We are not going to get that problem solved unless the people are made aware by the communicators, politicians and every other kind of communicator, of the limited nature of our resources.

The per capita figure for our average gross domestic product is in this State about one-third less than the UK. It is about half that of Western Germany and France. It is less than half that of Sweden and it is about 42 to 43 per cent that of the United States. Those are our resources. How well is the duty performed of telling the people that their resources place a limitation on what they can realise with them? It is all very well for Senator Murphy, in criticising Senator Whitaker, to dismiss what he describes as the tiff between Senator Whitaker and the front bench of Fianna Fáil or whatever, as merely disagreement based on the failure to keep good books. Senator Murphy and every other Senator could find themselves in difficulties if they did not keep good books, as the financiers of New York at the moment are aware. If the White Paper has misdescribed the starting point how much faith can one have in its faith in the correctness of its predictions as to the targets to be achieved?

I do not propose to get into a debate about the question of whether these are being realised. I do not intend to be knocked down by some observation to the effect that Fianna Fáil has greater faith in the people of Ireland than anyone else. Firstly, I cannot see why they should have. I have great faith in the people of Ireland. They stood up to a lot of Fianna Fáil Governments, for one thing, and came out of it remarkably well and will come out of it again. I have great faith in them only if they are faced with the stark truth and if it is not pretended to them by a party out of power that something can be done without their efforts to do it. There are plans. I have never engaged in national economic planning. I suppose I have read a bit about it. I wish they did not have the diagrams and the mathematics and I might follow it better. I read a bit about military planning too. Every schoolboy, even every professor, knows that any military strategist will have a strategy for the best possible case, a strategy for the worst possible case and a strategy for all the intermediate possibilities. That is if he is a good strategist. I do not find any alternatives in the White Paper. I do not find this range of possibility presented to us. I do not find sufficient reminder of the limitation of resources. There is more reminder than there was in the manifesto. Even if the umbilical cord is not cut, some sounds can be heard of the crooning between the baby and the mother, some indication of independence. Some separation is beginning to take place.

The White Paper is not as much an economic document as part of a political process. Part of the business is getting off the hook.

If one gets oneself onto the hook it is very important that the people's attention be drawn to the fact that one got oneself and them onto the hook involving this game of White Paper, Green Paper, White Paper. I will come to the methods and techniques to be used to achieve these aims and targets.

There was one trend proceeding under the last Government which must be very much to the credit of the Government. I am not being insincere here. That was an interesting operation. They did tell the people they were going to borrow like mad. It was an interesting judgment by a very astute political party, extremely well informed on the psychology of the Irish people, so they thought that would be very acceptable fare.

I am not going to get into an argument which the Minister would win hands down if he bothered to pay any attention to anything I say. I am not going to get into an argument about whether this is the time to increase borrowing. I am not going to get into an argument about where the money could be got. Firstly, the Minister probably guessed pretty well how much was likely to be in the Ministerial hip pocket before the start of the year 1978. What good does the Minister think it has done the Irish people to throw away three instruments which would have added to his flexibility as a governor of this economy? What good, other than getting votes, can it have done to have thrown away the road tax as an instrument? There is a very interesting corelation to be found between the rate of growth of consumer expenditure and the number of deaths on the roads. With a rise in the gross national product, up goes the mortality rate on the roads. What good did he do by putting more cars on an insufficiently well-organised road system?

How does the Minister justify the complete elimination of rates from private dwellinghouses as distinct from reforms? I did not ask him to borrow internationally the money to pay my rates. I sought to deprive him of the power to do so. I have no doubt whatever but that in some other form, which will probably affect my incentive to do something or other, I will be paying them again in due course. I see no good whatever in removing all tax from property occupied by people over the minimum level. Unless we become as well off as Kuwait, which is half as much and more than half as much again as well off as America, we cannot have these jaunts. They do not have general elections there, do they?

In this House from these benches now occupied by Senator Mulcahy and his friends I attacked the introduction of the wealth tax. I must say the Fianna Fáil Senators present here were very decent in their attitude to me. I mean that too. They did not press the thing to a vote, which would have greatly embarrassed me. But opposing the introduction of a tax is a very different thing to supporting its abolition in different circumstances. I have not thought my own position out completely or fully on this. I would like the Minister to justify in general, social and economic terms total abolition as distinct from complete reform.

There is one justification for it anyhow that nobody who knows anything about its operation could deny. It provided a lot of useful information to the Revenue in seeing that there was proper compliance with the other tax laws of this State. Is it proper that in the year which has been so well described by the Tánaiste in the document he issued, the year in which the trends are all favourable except, of course, the inadequately favourable trend on employment and unemployment, to start throwing away these favours? It is beyond doubt that they wanted power.

Part of the infrastructure on which foreign investment justifies its confidence in this country is the written Constitution. It is the operation of the rule of law. It is the existence of parliamentary democracy. It is the fact that the people can put out a Government and put in another one according to their choice. It is the fact that that operation does not involve such a change of stability that long-term investment decisions can be seriously affected by it. Part of that infinitely valuable infrastructure is the quality of the operation of the parliamentary process itself. Parties will discover those items of real differences between themselves, the nature of which may change and has changed according to the person who happens to be the leader at the time and according to the positions taken up on one side or another by prominent figures.

In the United States from time to time the political position of the Democrats and Republicans have changed. While I do not hold up the United States as a great model for everything at least it has done the business of producing alternative Governments without assassinations and after a thorough and a rational debate by the public concerning the real issues. My objection to this White Paper is the same objection that I had to the manifesto. It does not keep to the straight and narrow. The founder of the Fianna Fáil Party would not have produced such a White Paper. Senator Murphy's eloquence is so attractive that I can see he tempted Senator Ryan from his path. I had to resist the temptation to follow Senator Murphy. He is posing us questions which should be thought about. In replacing the socialist point of view, as was expressed by another university Senator in the previous Seanad, he has substituted geniality for acidity and I welcome that replacement. He has posed us questions but he owes the House a White Paper to tell us how this public sector policy is to operate in this western society without regard to the constraints and the limitation of resources which face it as well as the private sector.

It was interesting to note Senator Murphy's splendid pieces of lashing of the private enterprise sector. I would prefer if everybody was as devoted to it as I am, being its servant and butler, valet, parasite, professional, not yet on the list in the Department of Labour, and I hope never, but I would not accept the description as being merely "the private" sector. It is the free enterprise system we are talking about. Senator Murphy is far too good a historian to refer to the capitalist system as if that was describing in a full or satisfactory way the society that we are all members of. The capitalist system, as Senator Murphy knows, has been going on for a long time and it has certainly changed a great deal. Senator Murphy will agree with that.

In the Financial Times of last week there was a very fine article describing the acute difficulties that Sweden is in. Sweden has gone all the Murphy way, has got more than twice our average resources and yet it is in great difficulty just this very minute. Senator Murphy recommends socialism for us. I do not think it quite fair to a lot of people in this House to be putting us in the anti-socialist position because, speaking for myself, I feel so strongly about my country, the future of everybody here, generations to come after us, the nature of the problem that is facing us that I do not give a tuppeny little damn what technique is used to improve growth, output and employment, provided only that it does not involve an invasion of the liberty of the people—and by the people I mean all the people, even those little people and there are lots of them, who have in a generation moved to the private enterprise system—to the extent that they are ballyragged in this House by Senator Murphy or anyone else because they have done well with their talents. Provided only that what is involved does not threaten and that we keep our Constitution intact, the whole thing, as far as I am concerned, can be run by Senator Murphy or anyone else. However, there is a great problem to be solved by whoever is going to run it and that is the problem of being competitive in a highly technical innovative world which does not owe us a living.

From my point of view I do not have any ideology to overcome in relation to private enterprise or any ideology to overcome in relation to socialism and that is probably true with an awful lot of things. Certainly it is true in relation to members of my party. Cromwell I believe said "neglect no means". As words they are apt enough even from that highly unpopular source. At any rate, they are good enough for me. Neglect no means—whatever these means be stimulating to the private enterprise sector, whether they give some people well-lined pockets of money to do what they like with. Senator Murphy makes an interesting distinction. He moved from the public sector to the private sector and then to the multinationals who are being called to the rescue by the private sector. Of course the multinationals are the private sector too. They might not be the private Irish sector. I would have no ideology about the multinationals either. I believe they should be encouraged. They may have to be controlled. Indeed they must be controlled. But every technique, every resource must be used including the old resources of character, self discipline, hard work, rational risk taking, public spirit. There must be a recovery of old virtues as well as the introduction of new methods. They will all be needed and must all be used. If there is anything that we in this political party can do to assist that process we will do it providing what results from that cooperation is not misrepresented by the Government. Indeed we will bear the misrepresentation and try to expose it.

I would like to end on the most positive note. All my regret about the genesis of the White Paper stem from my doubts about the instruments used and my reservation about the wisdom of choosing targets that may prove impossible to attain, but I wish the Government every success in attaining them.

Mr. Mulcahy

I am in great danger of being inveigled from the path that I have thought out by the previous speakers, but when I listened to Senator FitzGerald I wondered whether he would not prefer to be making a speech in favour of Fianna Fáil. I thought he was going to end up his speech by wishing the Government all the best and by saying that he did not fully understand their policies but hoped they would work. I think that is what he meant, and that is a good way to finish.

I would make one point. The policies that the previous Government followed changed in an interesting way at the beginning of last year. There were discussions in the Fianna Fáil group as to whether or not we would go public on our economic policies. As people know, we did go public at the latter end of 1976. In doing so probably we showed some of the way but it was a little bit late for the previous Government to jump from the horse, and as a result they lost. Fianna Fáil went further. They also recognised that there was a mist ahead of the horses and that a lot of the horses in the economic race did not know what direction to go. They did not quite know what was ahead of them. Fianna Fáil lifted that mist so that the horses could get on with the job, speed up, and go in the direction of recovery and growth.

We are talking here about the White Paper. The White Paper is part of the planning process which is being followed by the Government. I would summarise the approach in this way. There are a number of people here in the employable population who need jobs. These jobs will exist in agriculture, in the manufacturing industries and in the service area. The main purpose of the Government at the moment is to produce an economy that will provide those jobs. In doing so their task is to set targets for job creation and to set targets for actions that must be taken as a means to the provision of those jobs. In doing that we have got to make decisions about the resources that will be required to implement these actions. The resources can be summarised in terms of the borrowing capacity of our economy and the investment strategy that we follow. It can also be looked at in terms of the systems that we are going to use to help us to do that, the systems of industrial relations, the systems of welfare and so on.

We are talking about jobs for people who are going to emerge from our educational system which will be provided in three areas. These will be provided as long as we organise our resources in the best way possible. The White Paper sets out to indicate how this might be done. I do not make any apology for the obvious connection that there is between the White Paper and the manifesto. It was a good manifesto. It was a plan. It did lift the mist. It did indicate certain levels of growth and certain levels of borrowing to bring it about. That is what the problem was at the time. The previous Government refused to do that. They thought that the world was confused and they would not try to lift the mist as far as their country was concerned. Would they say today that because the rest of Europe is only expanding at something like 2 per cent, we should not try to expand at 7 per cent? Obviously one cannot do it blindly. One must take into account the resources at one's disposal and how one is going to allocate them. The manifesto indicated how Fianna Fáil intended to go about it and the White Paper is now elaborating on that. It is the first step in the sequence of planning a process that we intend to follow.

In connection with the planning system itself, I never fail to be amazed by the perversity of the Irish people about some of the things that go on. Some of the comments on the media about the appointment by the Minister of Dr. Noel Whelan as chairman of the National Economic and Social Council are a glaring example of what I have in mind. This council is part and parcel of the planning process. It is not a player at the other side of a tennis court with the Government disporting itself on one side while another group at the far side watches and hit an odd ball back. Noel Whelan was made chairman of NESC by the Minister and the Business and Finance editorial heading the following week read: “Killing NESC” and it concluded:

If it is the Government's wish to operate without NESC let it say so clearly, otherwise it is engaging in a dishonest charade. The present NESC members ought also to consider their position. In our view, resignation would be the most honourable course.

It seems to be the greatest outlet that the media can suggest in situations like this that individuals should resign. I remember when I was in Comhairle na Gaeilge the number of times I was called on to resign. As a member of the present NESC, I have no intention of resigning on that matter.

For the past couple of years commentators and conferences have been calling for proper national planning. They did not get it from the last Government despite NESC's obvious encouragement. Now that a new Government have provided for a structure of planning, formalised in legislation, and with responsibility for planning allocated at Ministerial and Cabinet level, they are castigated for their efforts to ensure that good team work and effective communication will exist between NESC and the Government Department having responsibility for planning. Why must we always think of the negative aspect of things? An effective partnership between NESC and Economic Planning and Development is highly desirable at a time when we are fighting for a place in the race for growth and the capturing of job opportunities, a time when the unemployment rate in the European system is growing by 1 per cent per month. We do not want a Minister feuding with NESC. It should be obvious to everybody that the Minister is setting about building a system of integrated team work so as to harness the available knowledge, expertise and skills, not only within his own Department but also within the various agencies and councils having a connection with economic planning. To any person who has studied organisation theory it is really a matter of what we call boundary management. If you have a boundary between two systems it is a good idea to have a common element to both. They have found out in other countries—in the planning systems of France and Belgium—that one puts in individuals who overlap both. It is essential for this country to have an effective planning structure covering both economic and social dimensions. Now is the time for clear thinking by a planning system unfettered by the shorter term constraints and diplomatic obstacles raised sometimes by treasury pressures, and that is why it went outside the Department of Finance.

If we go on from there to think of the full dimensions of that, we must take into account a planning system which will relate to the EEC situation. It will relate to the fact that if the EEC are serious about what they can do for the Irish situation in terms of regional development, the kind of system that we use must integrate with the EEC planning system as well. There, again, there is room for boundary management. Hopefully, the members of the Minister's Department will have overlapping membership of committees operating in this area in the EEC, and so it goes on, the whole system interlocks.

Ireland's effort in trading in Europe is very small. We contribute about 3 per cent of the agricultural output of the whole of the EEC. We have to make it clear to our EEC partners that it is essential for us to grow at a rate which if at all possible must be in excess of the average rate of the EEC as a whole, and they must support us in doing this almost regardless of their own rates of growth. We cannot say that often enough to them. Applying it more generally, what I am saying is that the EEC should underwrite our economic and social development plans and allow us to get on with them for a period of time that will enable us to catch up and to get away from the stop-go policies.

Senator Whitaker made a contribution to this debate and said I had accused him of being irresponsible in an earlier statement he made this year. He was kind enough to say that I probably did not mean it in that way and, of course, I did not. We are very friendly and we will have many discussions on economic matters, not, hopefully, in the colourful way described by Professor Murphy, in the father/son relationship but on a healthy piece of dialectic about the fundamental economic issue. I do still feel that the Senator had not fully appreciated that his position of influence and eminence in the country was such, that when he made the statements he did, he raised some questions at a time when we were trying to build confidence. Confidence is the essential ingredient in any healthy economic system, and Keynes was one of the many economists to point that out. What happens is that when Senator Whitaker speaks all the reporters present raise their pencils and write furiously. For the rest of us, they watch and listen and then say what they think. That is his position, that is why he made such impact, and that is why I said then that he did not think long enough about the impact he would have.

Confidence in the economy is what the Fianna Fáil manifesto produced. Confidence, as long as it exists, will produce eventually a healthy economy. If the confidence disappears then we are in trouble. When you start with no confidence the sequence of events—and this has been laid down by far more erudite analysts than myself—relentlessly follows this chain: low investment, low growth in industry, lost jobs. Lost jobs will do two things. It will produce bad industrial relations which means low productivity and escalating wages which means low profits and no confidence. We are back on that particular pathway again. Going the other pathway, lost jobs means higher benefits and unemployment, low growth, high taxes, balance-of-payments deficits and so on, high cost of capital, no confidence, and we are back to where we started. So confidence at the moment is good. We want to keep it that way and we must think very carefully about it.

The question was raised earlier in this debate as to whether or not people were happy with the progress. Senator Brennan said "Go out in the street and ask anybody what they think about the situation." He had some comebacks on that which were, "Go out and ask them. Young people are leaving the country and so on." I would like to put forward ten reasons why things have improved. First of all, if we look at the import/export movements in the last few months we can see that the difference between imports and exports has decreased substantially and is holding.

I see that as some success in implementing that shift in purchasing pattern that we spoke about when we talked in the Seanad about the Guaranteed Irish campaign. The growth in exports themselves is a significant and hopeful sign. As we said on a number of occasions here, if exports do not grow at a fast enough rate then there is no hope of getting those jobs. Exports are growing. What is more significant is that they are growing in the industrial and manufacturing sector as much as they are growing in the agricultural sector.

The world economy, even though there are many questions raised about it, does appear to be holding the growth rate that it is achieving. In other words, it is not falling back. In fact, the recent Business Week figures published last week show that the American economy is getting up to the 6 per cent level and that the rate for a quarter is as much as 8 per cent. This will have a significant effect on world trade and will mean that the demand for our products will be still strong and that exports can be maintained. Likewise, we hear recently that the UK is managing to produce something like 6 per cent growth in the quarter, which would be excellent if they could maintain 4 per cent growth. So there are some good signs outside the country.

In relation to another point, I quote from Eorascáil, Bealtaine 1978:

ÁBHAR DÓCHAIS

De réir tuairimbhreithe a rinne an Coimisiún i dtús na bliana, tá muintir na hÉireann níos dóchasaí ná mar a bhí siad le cúpla bliain anuas maidir le dul chun cinn gheilleagar na tíre agus le méadú a n-ioncaim féin. Os a choinne sin bhí daoine buartha faoin easpa fostaíochta.

Tugann siad graif a thaispéanann go bhfuil tuairimí muintir na hÉireann i bhfad níos dóchasaí fós ná muintir CEE tógtha le chéile.

Mar is léir ón ghraf sin...tá an dearcadh dóchasach céanna le tabhairt faoi deara ar fud an Chomhphobail i gcoitinne, cé nach bhfuil sé chomh suntasach is atá i gcás na hÉireann. Déanann an Coimisiún tuairimbhreith den chineál sin gach trí mhí agus bíonn 20,000 teaghlach páirteach inti.

In the EEC, on the basis of a three-monthly review the Irish people are saying that they are much more hopeful than they have been in any of the years past. Looking at this graph, between 1974 and 1977 the Irish people were running way below the EEC average and miraculously it crosses over in the middle of 1977, so I would like to read that into the record of the House as well.

Recently the leader of the Confederation of Irish Industry, speaking at a dinner, in ringing tones said, "Taoiseach, it can be done". Even though Mr. Donovan, who is President, was not there, it was delivered by no less important a person than the defender of the faith in the free enterprise system, Mr. Edmund Williams. They think it can be done. To help to make the point, in the ESRI/CII survey all the main indicators—all the Senators and Deputies get copies of that report—show improvement and that the businessmen are hopeful. Production expectations have been going up solidly since December through March; the employment expectations have been going up solidly since August 1977 right up to March 1978; home sales expectations, which took a dip around December, have been growing steadily up to March. This objective data is available to every member of the House.

There is a problem and it is not going to be cured easily. If we do not set the targets that are needed to get rid of the problem we are not going to get anywhere.

The sixth point, which proves my point that we are getting somewhere, is that consumption is increasing and it will contribute to the growth. Despite the fact that the Central Bank talks of a figure closer to 5½ per cent, the feeling would be now that there is a growth in consumption, an increase in real earnings, as well as everything else. By the way, one point in relation to Senator FitzGerald's contribution is that one of the reasons why some of those tax concessions were given was that they did not add to the price; they gave money and spending power to people without affecting inflation. A fundamental point: inflation has improved and I have said before in this House that the last Government did their own bit for that. There is no doubt that credit has to be given where credit is due. But we must be careful. That figure could rise again if we are not watchful of every policy that we follow. What Fianna Fáil did in giving certain tax concessions was to avoid that particular situation, to give real purchasing power back, help to stimulate consumption and in that way help to achieve the growth that was required.

The problem area is that we are trying to achieve very high levels of growth as a means of stimulating the economy to produce and to operate at a level that will give us an improvement as defined by the targets in the employment situation. To do that we have to take certain measures in relation to investment. That means, as was indicated in the manifesto, certain levels of borrowing are required. Those borrowings, far from being used to pay for services which are not directly productive, must eventually get right back into the productive system to stimulate the economy at the point where manufacturing takes place.

Again, the question has been raised, and our colleague Senator Whitaker has raised the question on a number of occasions and counselled prudence, as others have, as to how far we can go with the borrowing. My feeling is that the capacity of our economy is a function not only of our capital but also of our total labour force. A hundred thousand of the, in theory, employable people are not producing. That means that something like £600 million worth of output is not being generated by the economy as it should be, and our challenge is about getting it up to that. We are running at a GNP of something like £6,200 million. In other words, if we are running at something like £6.8 million or so the problem of employment may not disappear but we would have tamed it.

Our challenge is to invest in and develop our industries in a way that will lift the output up to that level, and to do that we must borrow. In terms of prudence, what is a reasonable level of borrowing? When we look at the figures and at the risk, I have a feeling that Irish people get confused when the figures are thrown around that way. We are talking about £820 million of borrowing. Out of that £820 million the non-monetary borrowing is about £260 million. The monetary borrowing is £560 million and the foreign borrowing is £150 million. In other words, we borrow locally in most cases. The borrowings are spent locally; they circulate through the economy. The people we have to pay back are local and we can do deals with them to send that on a few years and so on. The actual foreign borrowings involved are £150 million. The equation is £150 million of extra borrowings during the year out of a GNP of £6,200 million.

Over a number of years foreign borrowing was built up to a certain level. As I can recall at the moment our total borrowing is something like £4,200 million, of which something like £900 million might be foreign. It seems to me that given this employment situation we are operating at too low a level, that we have little choice but to take the risk and that it is not too big a risk even when measured in those terms. Even the interest needed to cover those foreign borrowings is manageable.

Another point that is raised periodically is this famous matter of reserves. Again, something that is available to every Member of the House is the Central Bank Report. On page 25 of a recent report they state that the import cover, that is the number of months that the import costs constitute as a percentage of the reserves available is high at present by international standards and that some reduction can be tolerated. I am not going into the question of what "reserves" means, whether it is in terms of money or whether it is a position on the balance sheet. The OECD Report, which is available to all of us, makes comparisons between countries. Low and behold at the bottom line of the middle page of this comparison table I find that the total official reserves of the Irish nation are 2,372 million dollars. I look around at all the other countries and I say, "Where do we stand?" Denmark is 1,670 million. The great Australia is 2,383 million. Norway, given that they have a fair amount of oil behind them, is 2,200 million. Finland is 570 million. In regard to our young people, who are going to make up the main element of our problem—and I can bring it home to you when I tell you that at my age level I have two young people about to launch themselves into the environment looking for work—are we going to tell them in 20 years' time that we did not borrow enough in 1978 to ensure that we would stimulate our economy to the point where it would operate at full employment level because we did not want to be rolling the debt forward, or there were a few problems of that kind? They will not thank us. I think they would say "it was up to you at that point to assess the risk and come forward". It is a holy and wholesome exercise at times to go back ten or 20 years and ask what could have been done then if somebody was thinking straighter about it.

There were some figures quoted by Senator Murphy which I just could not follow at all. He talked about the non-contribution of the manufacturing sector in relation to employment. I tend to work this off a record of my own that I keep. My record tells me that in 1950 manufacturing jobs were something like 130,000 and that that figure rose fairly comfortably, particularly from 1963 on, up to a figure of about 220,000 in 1973 and then it fell back to the present level of 190,000 odd. Manufacturing did produce in that period but the overall employment fell because agriculture was regularly throwing off 5,000 or 6,000 a year and more in those earlier years.

The private sector, or the free enterprise system—call it what you will —was producing and is still capable of producing. In that regard, the most recent newsletter of CII on the private sector and job creation—interestingly enough, we received it today—shows a relentless growth in industrial output, in employment average annual change, in the periods 1956-65, 1965-72. Only in one period, that is the middle of the 1974-75 period, things began to go wrong. We might in that regard draw attention to the fact that nothing really appeared to be going to be done about it. The economic and social development document of the last Government—1976-1980—stated at page 35 that it was made clear at the time when public expenditure was increased to meet the problems of the recession that this policy must be adjusted to conditions of recovery, and that further growth in the real volume of current public spending was not feasible nor would it be an appropriate economic weapon in the new conditions ahead. It further stated that the shift in public spending policies must be accompanied by other policy changes designed to stimulate rapid growth. The last sentence is fair enough, but the previous one was frightening at a time when it was possible, as is now proven, to move to the point of 7 per cent growth. The problem that is before us and which will be with us through the eighties and up to the nineties is a huge one.

In the EEC as a whole in 1974 there were three million unemployed. In 1977 that had more than doubled to 6.25 million. In Ireland, in the age group of 15 to 19 years of age, over 20 per cent are unemployed as opposed to the EEC's 10 per cent. The Irish are adding 20 new people per thousand every year where something like 12 only is being added in the rest of the EEC; also about ten people are dying each year. We have a situation where ten extra persons per thousand are added to our population every year. That is an advantage and is an opportunity as long as the right economic policies are followed. If they are not, then it really adds to the problems and will add to them even more as we move on up to the 1990s. For every new entry into the employment arena there are two for one that will go out at present. But by the time we reach 1990, given the demographic assumptions made by people like Dr. Walsh, it will be three to one. In the mid-1980s the EEC job requirements will be lower because of their demographic structure. What is the position? Perhaps following the stimulation that should take place over the next few years, as part of the EEC scene, we will have to recognise that some of our employed people will operate in the EEC as a whole rather than just geographically within our own island while, at the same time, have the economic benefits return. This point has been mentioned earlier. This could have implications for policy, in the sense that, in order to get 100 jobs at home, we might have to agree to having 200 abroad. I made this point—there is nothing new about it—at a conference in Killarney three years ago, that the determination of the health of a job is as much a function of the market place as it is of any local economy. The market place for us to get rid of and sell the output we produce must be abroad. Therefore, we have to look abroad and say: if that is where the market is then inevitably, to supply it, a certain structure is required; we may have to have a situation in which 50 per cent of our people are employed abroad and 50 per cent at home. A whole new look may have to be taken at that, given that relentless growth in the employable population of this country. I would take that rather positive approach rather than the somewhat negative one I thought was taken at the recent IMI Conference in Killarney, by some of the speakers there. Inevitably, and I suppose eventually, we will be left with some residual, almost unemployable group, and something special may have to be done with them but that is a matter for another day.

In relation to progress made to date on job creation, it will take some time for the job creation efforts to emanate. I have made a few calculations which are my own entirely and have nothing to do with any that might be carried out in the Minister's Department. It seems to me that, given the Government's efforts in the public sector area to generate jobs, to approve jobs, then for those jobs to be filled there will be a time lag and that perhaps we will not see the best of it coming through until some time early in the next year. I see something like a three to four to five-month lag in the system even though the jobs have been created. That is inevitable in the public service system. But I see them coming through strongly. Obviously from what Liam Connellan of the Confederation of Irish Industry has been saying on his figures, he sees them coming through in the manufacturing sector as well. That is, if you like, an explanation of some of the figures published recently about employment in the manufacturing sector which were a bit disappointing.

Finally reverting to my point about confidence: confidence and its maintenance implies the sense of responsibility I mentioned earlier all round. Even though I understand it I get somewhat impatient when I hear the criticism of what is now Government policy as being an election device, the manifesto being an election device. Given that the manifesto has been translated into policy and is at present being put through the system as policy we must all get behind it because of the nature of the problem I outlined earlier and the way it is growing. That is why people in the trade union movement, in the private sector and those in the media should be very careful in their comment, that it is informed and is not reaching for the sensational as a means of capturing attention. Certainly I sympathised with Senator FitzGerald when he asked for the truth. It is one thing to have discussions about truth in the past but it is very important, and more important, to be true about what is happening today, because what is happening today will provide the future and, in our case, that means jobs.

I would support what Senator Ryan said about the need for an improvement in industrial relations. I would go so far as to say that, in the case of the public sector—where the jobs are highly secure and guaranteed by the State and where the pensions are, in many cases, index-linked to cover the inflation rate, where those secure jobs exist—we might accept, for a period of five years, that some device or agreement of the kind Senator Ryan mentioned be agreed, that, in that sector strikes would not be allowed, that any disputes that would arise would be referred to the Labour Court and their judgment accepted.

It seems to me that the nature of the problem before us, that of generating a healthier economy and a higher level of output, requires measures of that kind, and that those people who have secure jobs should be willing to give up that right, not permanently, but for a period. The right to strike is a sacred right in industrial relations, and I accept that. I would feel that we would almost have to keep it in the industrial sector. But, in the public sector, the public service employees should be willing to forego the right in that time. There is a terrible danger—and this is one of the dangers about public sector activity—that in many cases they are monopolies. We have had the difficulty of the telecommunications strike; we have had the difficulty with the Aer Lingus strike. I know business friends of mine who lost 40 per cent of their business over the telecommunications strike, business they will not be able to recapture. The Aer Lingus strike caused difficulties in relation to the work being carried out abroad by Aer Lingus. They have an elaborate computer system which they use to sell a service to other countries and other airlines. These things all get messed up by the continuation of that type of industrial relations unrest. I believe that is a measure that could be reached, by agreement, between the trade union movement and the State.

I believe that we are not talking about over-optimistic targets. This word "over-optimistic" has been hopped around by the media and a number of people. I believe that these targets are the ones we must achieve. They are not merely thought up for the sake of winning an election. They are thought up because they were the means by which this country would be saved and, as such, it is high time everybody else in the country recognised the facts; the reason for the existence of the targets can be worked out by doing a few simple sums. We do not have any choice but to go for them. What we have to be careful about is that, in doing so, we do not go blindly along the pathway, that we are prudent about it but that we are not afraid to take the risk.

It is about time the word "gamble" was thrown out of the debate too. The figures, as spelled out rather crisply, I think, by Liam Connellan in one of his speeches recently are that for every 1 per cent increase in growth in the agricultural area there are 2,500 jobs; for every 1 per cent increase in manufacturing there are 3,000 jobs. That is easy to remember, and that is what we are about. That requires investment in both manufacturing and agriculture and requires, particularly in relation to agriculture, a whole new approach. It cannot be delayed while slow bureaucracy decides when things should be done and at what rate they should be done. Things have got to be done much more quickly; we need the faster decision-makers. The amount of investment suggested by Liam Connellan in this regard, with which I am sure the Minister would go along, is something like an extra £160 million. It is worth borrowing £160 million extra a year to meet these targets. They are not over-optimistic, they are the realistic points this economy must reach to answer the problem.

Professor Murphy

Briefly, on a point of order, when I began my speech I castigated the Minister for Economic Planning and Development on this absence and went on to adopt a high moral tone about the ignoring of the Seanad by the Minister and so on. Therefore, I felt very mortified indeed when the Minister came in and I would like to tender my apologies both to him and the Leader of the House.

Mr. Harte

I should like to begin with one point Senator FitzGerald made, that is, it does not matter whether he described it as a private enterprise or a free enterprise, the fact is that we live in an anachronistic society where the favourite catch-cry is "I'm all right Jack". I hope I did not misunderstand him, that he was not advocating we should continue that trend. Another point made was by Senator Mulcahy about a healthy economy. What is a healthy economy? The economy was healthy when we had 10,000 people emigrating between 1960 and 1970. That was a healthy economy; the profits were good; the wages were good.

Mr. Mulcahy

It was not healthy.

Mr. Harte

It was claimed to be healthy by the Fianna Fáil Government of the day. If that is a healthy economy I do not want any part of it. I do not want our people to emigrate; I want them to work at home. I want jobs to be created for them in their own country. I am sorry this crept into the debate but saying that strikes should be banned in the public sector is a serious statement to make at a time when we are trying to win the goodwill of all sides of the community. It is not a good thing to do. I shall leave it at that. We have a fairly good Minister for Labour who can relate to people. That is the way it should be done, through him rather than making statements on how we should deal with strike situations.

On the White Paper itself—in the Fianna Fáil pre-election manifesto they outlined the economic policy they were supposed to pursue if they were returned to power. The White Paper— National Development 1977-78—sets out to confirm those policies. The budget displayed clearly also that it was consistent with the pre-election manifesto. Whether or not it makes people restless or somewhat intolerant the whole purpose of the exercise at the time was to lay claim that the Coalition had the country in ruins economically speaking; that was its purpose. The purpose was to get the other Government out of power. That is the purpose of all Oppositions. The pre-election strategy—and I am not bellyaching about it although I feel it was misleading—did the job and returned them to office.

If they believe in Dr. Goebbels tactics, that the bigger the lie the bigger the audience, they succeeded. The truth of the matter was that the economy, by the end of 1975, from the earlier recession was back on the growth path. Therefore, the present Government inherited an expanding economy. In 1976 it was back up by 3 per cent. The volume of production grew by 5 per cent, exports by 20 per cent and the volume of imports of producer capital goods was also a clear indication that the economy was on the move. In fact all these economic indicators of the day showed clearly that there was an expansion in the economy, particularly in 1976, and the trend continued in 1977.

I should like to quote now from an article, "An Analysis of the Government's Economic Strategy" by Paddy Geary in Magill, April 1978 in which he says:

The manifesto described the state of the economy in May 1977 as follows. There was a record number of people out of work; the Irish inflation rate was the highest in the EEC; the Coalition government was borrowing "at a phenomenal rate". To confront this situation, a "crash campaign" to boost industrial and agricultural expansion was proposed; once the economy was going again measures would be adopted to sustain growth. In brief, the economy was viewed as being in recession; a pump-priming exercise was warranted to renew economic confidence and hence the growth of investment, employment and output.

Mr. Geary went on to tell us that this view was incomplete because, in the third quarter of 1975, there was evidence that the recession was coming to an end in the industrial sector. Mr. Geary continued :

In that quarter, the volume of output of transportable goods industries showed a small rise after five successive quarters of decline. The recovery continued in the final quarter of 1975 and gathered momentum during 1976, when the volume of production grew by 9 per cent—the corresponding figure for the manufacturing sector was 10.6 per cent. The growth of output continued during 1977 so that by May, there had been seven successive quarters of expansion. Exports of manufactured goods also grew rapidly during 1976, an increase of 20 per cent in volume terms being achieved after a fall of about 4.5 per cent in 1975.

That is clear evidence that they did inherit an expanding policy. They did tell the people that the Coalition Government, economically speaking, had the country in ruins, which was not the truth if one accepts these figures. Though the nation was told that the Coalition's policies were causing economic ruin, for the record, if for no other reason, the evidence of the very substantial success of the Coalition policies as shown by the indicators was in existence. Naturally there was an upturn in the world economic situation. The Coalition Government can take no credit for that. It did help the situation, but nevertheless, we were in a growth situation. Because of those factors their policies were successful. They even predicted a 5 per cent growth rate for 1977 and were correct. It is clear that the present Government, not only conveniently lost sight of the growth factors when laying their charges of unemployment, excessive inflation, and so on but they made no contribution to that success story. I hope they will make a sizeable contribution to the one they envisage now.

I will admit I was not terribly happy about a lot of things in the Coalition Government but, like every other democrat, I accepted what was the majority ruling, became the advocate of a lot of things, and I would do it again. I will admit also that I would never be happy with any Government, even a Government of which I would be a member, as long as the unemployment rate remained at such a high level; I could never accept that; I would always find it difficult. That is the crucial test for the present Government—it is the vital area of economic performance.

To deal with their programme the Fianna Fáil Government, according to their manifesto, went for a deficit of £405 million. This was introduced as a stimulus. We were told the idea was to increase growth approximately 4 to 5 per cent, to reduce unemployment and reach a target set at 7 per cent. They have not reached the 7 per cent yet and frankly I do not think they will do it.

In view of all the evidence of growth under the Coalition Government, it seems to me that the trends at that time, to my simple mind, indicated that the 7 per cent would have been more possible under the policies of the Coalition Government even though they might not have been so imaginative because as evidence illustrated things were going for them. A great deal of the stimulus in the White Paper is given in the form of personal expenditure. A great portion of it will go on imports rather than home-produced goods. I believe, along with others that I have heard speaking, that the consequence will be that the growth rate may not get beyond between 5 and 6 per cent.

Let us look at what happened in the employment area in the last 11 months since the Fianna Fáil Government assumed office. The unemployment figures have been affected on the right side by about 5,000 on a seasonly-adjusted basis. If we are to go by the manifesto targets, and these are repeated in the White Paper, this figure is well below expectations. As I understand the claim, it was that there would be a reduction of 25 per cent in unemployment compared with the time they took office, given the implication that the live register figure of 85,000 could be with us by the end of this year. That was the implication in that part of the document. We are almost into June of this year and we still have a live register of 109,000 to 110,000. Emigration has started again and we are back close enough to the figure of 10,000 a year. If that trend continues we will have 10,000 a year. If you like, we have had a reduction of 5,000 on the live register in 11 months. Emigration has started up again. We will not be able, in accordance with the promises given by the Fianna Fáil Government, to reduce the live register figures to 85,000 by the end of this year. There are only six months in which to do that. Somebody better at mathematics than I, will tell Senators the number of jobs that must be created between now and the end of the year to reach that target. Even with all the Government are doing they will not reduce the numbers on the live register to 85,000. However, emigration will assist them in reducing the live register rather than, as is contended, the national development plan. Emigration will play a large part, as it has played for many years for many Fianna Fáil Governments, in keeping the figures on the live register down.

That, to me does not show evidence of success. If we are going back to the sixties situation of emigration at 10,000 a year, if the Government are going to use those figures—let us say that the live register figure does become a reality—perhaps they will come near enough to it. Are they going to give credit to emigration, because their policy included emigration? They have not said that so far, and if they are to take credit for creating jobs and emigration continues then they can take credit for creating jobs in London, Coventry, Glasgow and a few other places, possibly in the EEC countries. However, that is an aside, but an important one.

I must come back to the reason I gave before why the target will not be reached. I do not think Senator FitzGerald likes the idea of the argument being put too strongly in favour of the public sector being developed as a job-creating agency. When I talk about the public sector being developed I talk about it from the manufacturing side by and large, because at the moment we are providing services, as Senator Murphy pointed out. For instance there is CIE's railways. There is great scope in the manufacturing area for the public sector to play a role running alongside of the private enterprise sector, and it upset me a little to find the manifesto and the White Paper placing such heavy dependence on the private sector to do the job. There is no evidence that since the foundation of the State the private sector played a major role in reducing unemployment. Even when things were supposed to be good and we had one million Irish-born people in Great Britain, there were still 73,000 to 74,000 people on the live register. Even when the Fianna Fáil Government were out of office and we were supposed to have a good period we had still between 73,000 and 74,000 people on the live register. There is very little in the White Paper that would give you any confidence that the public sector will play an important role in creating jobs, particularly in the manufacturing side.

Maurice O'Riordan, the Irish Transport and General Workers Union Research Office and Paddy Geary hold the view that this Fianna Fáil study is unlikely to do anything to realise the target. As a layman I can only read the economists I know about just as Senator Mulcahy reads the Federation of Industries and someone else quotes that. I admit that economists are confusing. Many years ago there was an economist in America who said that if they did not reach their targets he would eat his hat. He was referring to a hat made of sugar. That man had to eat the hat, and on television. I am glad that Deputy O'Donoghue, the Minister, did not say that he would eat his hat.

I said it before and I will say it again, there is not nearly enough in the White Paper to indicate to me or my party that the public sector are being used to the greatest advantage. They have a very good role to play, particularly in the manufacturing side, and they can do it. I am not saying it in a dogmatic or in an ideological way. I am saying it in a practical way, because I believe that the free enterprise system down through the years has failed to do the job, and what I call a healthy economy is when everyone is working and everyone has a few shillings and where no one section or group of people have a more privileged position than another group of people. Then I would say we were living in a fairly good healthy economy.

As long as that situation does not obtain I will continue to hammer home this point. It may fall on deaf ears but that will not stop me from hammering it home, because in the long run they will have to get down to it, because the tendency over the years—and nobody thought much about it—has been towards a mixed economy. I think there is great scope for that, but the White Paper has not done enough to encourage it.

We are talking about job creation and utilisation of every situation possible. I will not talk about the banks making excess profits—that is what they are in the game for—but that is not to say I approve of somebody making excess profits while somebody else is not getting anything. What I am saying is that we in Labour have a very long-standing concern about the running of the Irish financial system. We feel a strong financial framework is absolutely vital to successful industrial, social and economic growth; that a massive transfusion of investment is needed, particularly in the manufacturing industry, if we want to see industry being generated and unemployment reduced.

I do not think we are going to achieve this by ploughing back profits and by the stronger national development council. I do not think either of them could provide enough capital to do those things. Suppose the State were to go into competition—taking over the banks or the insurance companies or anything like that; but we are talking about a free enterprise system, and the State would be entitled to enter the banking field in a free enterprise situation. People stand up and say we should take over the banks. Why do they not say that we should go into competition with the banks? The banks and insurance companies are attracting more and more workers' money every day in the week. There is a greater tendency on the part of workers today to save and to make great use of banks now as distinct from years ago. Why cannot the banks, therefore, contribute more towards creating employment by feeding something back?

The banks have millions and millions and represent a vast amount of financial power, power that could transform the whole fortunes of the manufacturing industries. We should have the courage to start thinking about diverting State funds into manufacturing investment—I hope I am not arrested when I go out, that the banks will not have the police outside the door or anything like that. I do not think the banks or the insurance companies are doing enough to help the development in the manufacturing industry. I am inclined to the view that if we were to examine the loans we might find that the financial institutions lend a lot more money to property developers and people of that kind than to manufacturing industries. There is no reason why they could not do a favourable deal with the Government to help manufacturing industries. They have the money and we should get after them a little more. They are investing in the national loans and so on, and that is fair enough, but they should do a lot more to help the situation in regard to unemployment.

I was a little disappointed when I came to the social aspects of the White Paper. It has always seemed to me that there is a wait and see situation for the poor in our society. They have always got to wait and see how the others will do before they can expect to get anything. It is ironical that you can hand back £2,000 to people who come into the wealth tax bracket. Wealth tax is applied in Denmark, Sweden, in about nine European countries, and it has no effect on their economies. It has not tended to send money out of the country. It is ironical to see £2,000 being handed back to people and there is no evidence that those people have created jobs or that it has been beneficial to the economy, and I do not think you will see much evidence of it in the future. At the same time as we are giving back £2,000 wealth tax we are asking people on social welfare payments to accept 10 per cent over a period of 12 months, which in fact only covers the inflation situation. If you measure that against the changes in the sliding scale of the capital gains tax from the date of acquisition to when it is reduced to nil you will find that the sector of society who depend on social welfare again got a raw deal.

In the budget the threshold for the corporation tax was raised again, another advantage to one side of society. Again, in the agricultural and fisheries co-operatives, certain profits were exempted. I am trying to illustrate how we treat one side of society as against the other. The lowest paid and the least able in society are taking the brunt of the situation. Good wage earners got a fair deal by the personal allowances' increase, but at the same time the people who needed a deal did not get it. This is a cause for concern. There was no real concession, in my view, to the social welfare recipients in the manifesto or in the White Paper. I fear that this is always going to be the trend. For example, the Irish Congress of Trade Unions were arguing at that time that in order to meet the situation in the social welfare sphere a husband and wife would need an increase of at least £3.50. When the wage agreement was agreed not only was there a wage increase but the wage increase had protective clauses in it, but there is no protective clause in the social welfare code for the social welfare recipients, and consequently a husband and wife have to take an increase of only £2.40, which only covers the inflation rate from April to April.

I hope that that tendency will not continue. I must condemn the wait and see attitude where you have got to see whether the well-off sectors are going to do well for the poorer sectors to get some of the crumbs. That is the situation facing the people who can least afford to live up to the demands of society. Somebody spoke about needs earlier. We are not dealing with needs in the type of society we are in. We are dealing with wants, and the needs of the social welfare recipients being neglected while the wants of the other sections of society are being satisfied.

Having read the manifesto, I am afraid that there can be severe consequences from the gamble about the percentage of the gross national product being borrowed. It now stands at 13 per cent. I know the Government's aim is to reduce it to 10.5 per cent in 1979 and 8 per cent in 1980, but if the gamble does not work we will see a massive increase in taxation, or worse, a major cut-back in public spending, particularly in the area that will affect the weaker sections in the community.

The first to get the hammer when you start cut-backs are social welfare, health, local government. They are all things on which the lesser people in our society, the poorer sections of our community, are greatly dependent, and they are the areas that are likely to get the hammer, the areas that are likely to suffer in any situation where the gamble does not come off. If the Government win, the rest of society will get something, but if the rest of society do badly the social welfare classes will not get anything. They cannot win in the type of society we are living in.

I do not apologise to Senator FitzGerald or Senator Mulcahy in this respect. I will do all I can to change that. I am not saying it in an ideological way, but I would encourage the tendency that I saw years ago in a mixed economy. I do not see any sign of that being encouraged any longer. If we do have the feared cut-back, and it is very likely from the less well-off people in society being affected, we would have a slow down in economic growth and of course the prospects of creating 20,000 jobs by 1986 will not be realised.

Professor Conroy

On behalf of the Government side of the House I should like to accept the very courteous apology tendered by Senator Murphy.

Mr. Donnelly

First of all, I should like to touch on the comments that have been made in the debate so far on the status of the White Paper and its relationship to the manifesto and the Green Paper which is to come. There has been criticism on the basis that the White Paper does not reflect what was promised in the manifesto before the election. Similarly we have heard criticisms that it too closely mirrors what is in the manifesto.

I do not think there is any doubt that the White Paper mirrors what is in the manifesto. That is how faith is kept with the public in that matter, and that is simply a continuation of the thinking and the policies put to the people. What lies beneath that type of comment and the confusion is, seems to me, a basic confusion on the role of planning in the economy.

Criticism was made of the fact that this would be followed by a Green Paper and there were fairly derisory references to probable more papers in the future. Naturally there will be. Planning is a continuous process of assessment and reassessment and of refinement, and every time you plan you consider how to plan the next time. The confusion in the matter was demonstrated by the Leader of Fine Gael in his speech at the Ard-Fheis. He said that he was not going to make any comments whatever on the White Paper on the Government's economic strategy. He alleged that critics and prophets of doom of an independent status had indicated that it would not work, and he was simply content to wait and see whether they were proved right. It was an extraordinary vacuous performance. If that is the extraordinary type of economic leadership the Leader of the Opposition offers to the public, then it is perfectly clear why there is so much confusion about planning.

It is even more clear when we recall the extraordinary statement on the subject by the former Minister for Finance, Deputy Richie Ryan, when he said that planning was not possible in conditions of economic blizzard, or stringency, or some graphic words to that effect. It was an extraordinary remark in any circumstances but it was particularly extraordinary because it was greeted by total silence from his colleagues in the Coalition who profess themselves to be socialists, because whereas all planning is not socialism there is certainly no socialism without planning. If Deputy Ryan's proposal that it was not possible to plan in times of economic difficulty was true, then he was propounding a new form of socialism because it seems to be a type of fair weather socialism. Presumably if a capitalist system or some other system could get the economy moving, then you could move in with your planning and whatever form of socialism you are concerned with, and when you go up the rails again you have to give up the planning and the socialist approach and go back to capitalism—an extraordinary quixotic approach to economics. The remarkable thing about it is that it was greeted by total silence, it was never commented on by the Labour Party or the members of the Coalition Cabinet in the Labour Party.

I find that the continuation of that confusion from some of the Opposition benches towards the White Paper is perfectly understandable. They simply do not know what planning entails in the economic sense, and that seems to apply in Government to both sides of the former Coalition.

I should like to refer to the emphasis which has been placed in the debate on the private sector and the encouragement given to them in the budget which, of course, was the instrument which fired the manifesto in the first place. There is no ideological hangup about relying on private enterprise. The Minister for Finance has said on a number of occasions that it was simply a pump-priming exercise, something that was necessary to get the economy moving, and there are many historical parallels to that. In another debate some time ago I refered to some of those parallels, but to emphasise the point, many socialist countries and socialist economies from time to time, when things were needed to generate activity, to get their economies moving, invited in foreign capitalists, encouraged industry based on private enterprise, simply to generate activity. They had no intention of giving up their socialist position. They simply needed something to get the economy moving and to prime the pump in their case. The best example, historically, was Lenin's resort to the new economic policy, which was a direct invitation to mainly American capitalists to set up industries on a profit basis in the Soviet Union after the October Revolution.

In our case there is no ideological hangup about it. We have a long tradition of a mixed economy, and a mixed economy undoubtedly continues regardless as to how emphasis may have been put in the debate or any suggestions that it has been dropped or the role of the public sector has been watered down. It is simply a question of priorities. It is a particularly ironical criticism because most of the major examples of State enterprise here were established by Fianna Fáil, developed by Fianna Fáil and very often against thoroughly biting and sarcastic criticism from the Opposition. Despite that record, we are accused of not being interested and of watering down our interest in State enterprises. There is no ideological hang-up. There is no reason for putting emphasis at the moment on the private sector other than to get the economy moving and to start things happening, which they already have in terms of increased employment and the growth which was achieved since the Government took over, and in the projected growth which is set out in the White Paper and in the budget.

It should be emphasised that as we are putting this reliance on private enterprise and giving very definite inducements for them to perform to target, we recognise, as critics have said, over and over again, that private enterprise is interested first and foremost in profit, and employment afterwards. That is true. Profit is essential no matter what form of enterprise you have. Profit is simply a measure of the increase in wealth from one period to the next, and that wealth is absolutely essential in any form of political system. Social investment can be made so that employment can grow, and all that is related to growth. Profit is just as vital and just as avidly sought after in the USSR as it is in the United States.

The argument after that is how the wealth is used, how it is reinvested. Let us have a look at what we have done to assist in generating this activity and in providing inducements which, let it be remembered, are available where appropriate to public and private enterprise alike. The taxation system has already been referred to. Corporation tax provides for a lower rate of tax on profits under £30,000; free depreciation continues entitling industries to write up the capital cost of equipment, immediately as they wish, or to their best advantage from a tax point of view. Stock relief continues to give relief for the effects of inflation for replacing and expanding stock. Export tax relief continues. A reduction in tax is given where an industry or business can show that it has increased employment by 3 per cent from one year to the next. Our State support in the form of direct grants continues through the Industrial Development Authority, Bord Fáilte and various Departments. They continue, and let it be emphasised, in respect of private and public enterprise alike, but it must be pointed out that that support is for the economic entity; it is not for the owners or the individual members of the company who may own the economic entity. When it comes to a question of remuneration of owners of the extraction of earning or wealth for personal use from these economic entities, then very different taxation rules apply.

Welcome and necessary increases were given in the personal relief of taxation, mainly for the benefit of workers but certainly available right through the scale. Our top rate of personal tax is 60 per cent. That is fairly high but not too high by international standards, but what is high is the rate at which a taxpayer proceeds through the different bands into the higher rates of tax, and a personal taxpayer in Ireland will reach the higher rates of tax much quicker than in most other countries.

That clearly shows the distinction being made between encouragement for private enterprises directed to the economic entity, the standard unit itself, and the rules of tax which apply to an individual in his own earning and his own spending. Viewed in that sense, this emphasis which we have put on private initiative at the moment is not in any way a free ride for capitalists or speculators. There are very stringent tax laws which will attach themselves to their private earnings and wealth which are quite distinct from the support that is given to their economic unit for the very good reason that their economic unit and their economic entity will provide the growth and the wealth and will provide the employment whereas they, in their personal spending, will not do so to any extent. That is the distinction and puts in perspective the strategy in this case and in no way, when examined and analysed in that manner, can it be seen as a free hand for high-income earners as opposed to the economic entity which provides the growth and the employment.

The cost of providing employment is so enormous now, both for the individual enterprise and for the State, that I feel it has come to a stage where industry, business—public and private—— should begin to examine their responsibility and decisions they could take in that matter which up to now perhaps we would not normally expect them to take. The employment of people who are not strictly necessary for an undertaking is something that was rarely entered into in the past. But there are certain types of large scale economic units in the public and private sectors which should begin to analyse the problems and their own responsibility in the matter. The economic cost to them and to the nation of continuing high unemployment or of rising unemployment in time will be so devastating that their own economic base will be threatened. That is from the point of view of their own self-interest, but, in addition to that, I believe the time has come to raise the level of social consciousness in business, particularly in the larger enterprises, to see what contributions they can make to the basic problems beyond their own immediate needs or responsibilities. Nowhere is there more need for this attention or need for the exercise of this responsibility than in providing jobs for young people.

I feel I should put in my own interpretation on something I thought was said earlier in the debate. Senator Harte interpreted a comment made in relation to employment by Senator Mulcahy and said that he regarded a healthy economy as one which was financially well structured. I believe that Senator Mulcahy's point was that a healthy economy was one that was fully employed as well as financially well structured. Of course, that is exactly as it is because in the long run one simply cannot have one without the other. In relation directly to the problem of young employment, a problem which manifests itself to an alarming extent right through the western world, the OECD, for example, pointed out that in the seven major industrialised countries there were as many as six million people under 25 years of age out of work. In Italy they quoted a figure of 64 per cent of the total unemployed being under 24 years of age. We have a similar problem and how it is viewed depends very much on the attitude of mind. The high proportion of young people in our population which is frequently referred to is seen as a potential problem in that it would increase and does increase the percentage of dependence in the total population.

That is one way of looking at it. But a healthy and lively attitude of mind will see in this a tremendous potential not only for the individuals themselves if they tackle the problem properly but for the country. If we fully educate, train and equip our young people to achieve their potential then we would have provided this country in a few short years with a proportionately higher level of contributors to the economy than our competitor countries in Europe and elsewhere. That is where our economic potential lies. Rather than being concerned with mitigating the worst effects of what will happen if we do not tackle this problem, what we require is a lively attitude and an openness of mind to pursue different thinking, to perhaps think the unthinkable in certain areas and see where we can harness this tremendous potential for power in our economy.

Industrial enterprises and big economic units should examine their role in this and see where they can take on young people with a view to training them in the different skills within that industry. That not only contributes to the solution of the problem and they not only face up to their economic and social responsibilities but they also have certain advantages in so far as as they are taking on a cost but they are also getting relief for it through the taxation system. To that extent, probably only half of the real cost will actually fall to them.

A number of other areas should be explored here. To some extent some of these points are already under consideration by the Employment Action Team, but I should like to raise for consideration this approach of reassessing responsibility beyond the strict economic yardstick which might have been applied and acceptable in the past. Not only should additional workers be taken on in the appropriate type of enterprises, but our industrialists, our commercial enterprises, should reach out into their own community. They should provide the leadership in community centres around the country, in the training of young people and in the providing of economic and business leadership to young people so that small units of economic and business activity can be developed based on local labour and based on the expertise which organisations, companies and various business entities are in a position to give at relatively low cost to themselves but at an immense advantage to the local community where that expertise is brought to play.

Companies in their training, and generally in our approach to education, should try to provide a greater variety in the technical training and a broader base to our general educational approach. Too refined, too specialist type of training can reduce the outlets for employment initially. It can lead to redundancy problems which are much more difficult to resolve because of the lack of adaptability in the individual. In this sense also our present industrial activity can enter into this area by adjusting their own training techniques, by providing a greater spread of skills and a greater potential adaptability by their young people. I was also impressed by the strong emphasis which was put lately on preparing young people for interviews and seeking jobs.

This is important because it is not just a question of providing a job for someone who can apply for it better than someone else. It also increases the availability for employment generally. Any individual has a right, as part of his education, to know how to present himself properly when seeking employment. A number of our schools are already undertaking this. However, these people should be assisted in this by industry and business. They should be prepared to provide expertise at a relatively small investment to themselves through their personnel departments and otherwise. That type of expertise and instruction can be of immense benefit to young people in preparing themselves when looking for employment. That is a natural right of any individual, apart from the economic sense which it also makes. It also has a great economic advantage, because employers would be in a position to assess in a real sense the talent and the knowledge which is available to them which might otherwise be hidden or closed.

If the standards of young people coming on to the employment market are raised and if they are assisted and educated in these matters that will also raise the level of appreciation of the talent available. It will create a better climate for encouraging people to expand their employment and the general attitude which is taken by employers of the labour market.

I referred to the help which business can bring to small local communities by entering into the life of that community by providing leadership in the economic sense to set up small trading, manufacturing and industrial undertakings, undertakings that would employ from three to ten people. There is great benefit and far greater potential strength for the future in expanding our employment in an ever increasing number of small units than over-emphasis on large economic units. All of this entails a high degree of responsibility in our industrial relations and a high degree of industrial harmony. Nothing disrupts the climate for expanding employment more than disputes. Very often those disputes could have been settled by common sense. I am talking about strife, industrial rancour, and a sheer waste of time and talent. It is in this field that I suggest that the social partners should recognise that they have a real identity of interests, for their own economic advantage and for their social responsibility to this nation.

Dr. Martin

I do not propose to go into the area of ideology as we heard earlier today from Senator Murphy and Senator FitzGerald. On the other hand—I do not intend to engage in that kind of economic diagnosis on which the whole party politics was treated in terms of pathology, what was a whole and healthy economy. In fact, I want to be practical and prosaic and concentrate on three areas which are worth bearing in mind in a practical commonplace everyday way in looking at this plan and at the whole question of planning. They are tourism, housing and education.

I was impressed by Senator Murphy's remarks about the public sector because it has been down graded too much in our discourse. He drew attention to enormous indigenous successes that some of our companies have had. I speak particularly of companies like Bord na Móna, Cómhlucht Siúicre Éireann, Aer Lingus, RTE, and Bord Fáilte. On the other hand, the prospect of seeing our economy completely handed over to that sector is not a very beguiling one. Reference to the telephone dispute draws dramatic attention to something that hardly seems to be susceptible of cure by any kind of planning. Senator Mulcahy, for instance, raised the question as to whether it should be made illegal for people in safe jobs to go on strike.

Mr. Mulcahy

I did not say illegal.

Dr. Martin

I thought I heard Senator Mulcahy say something of the kind that people who are in good pensionable jobs, well paid in the public sector——

Mr. Mulcahy

Voluntarily was the word I used.

Dr. Martin

That makes my point even better.

Mr. Mulcahy

In a five-year period.

Dr. Martin

I am sorry for having misinterpreted the Senator, but that makes my point even better because it sounds so splendidly Utopian that they should themselves voluntarily offer that. That would really be in the best of all possible worlds, would it not? The trouble is that we exist in—if one wants to speak in those terms—probably the worst, because we live in a democracy. Democracy is a place where people cannot be persuaded voluntarily to impose self-denying ordinances on themselves at all. In fact, a governing party and competing parties—we saw this today when we were trying to relate the manifesto all the time to the White Paper and to the Green Paper to come—engaged in our democracy in a dismal competition in handing out what appears to be benefits or entitlements, palliatives, concessions, to the public thereby getting themselves into power. By and large when they offer these palliatives they do their best to see that they are not going to be altogether destructive but they really are appealing all the time to a highly selfish motive in their constituents. An outstanding example of this was the £1,000 grant for housing which was gobbled up almost completely within months. All the benefits of it were gobbled up in that time if one looks at the enormous increase in the cost of houses. That surely is one of the big areas of concern among us at the moment.

Senator Mulcahy is thinking in terms of goodwill—and I applaud him for this—but one should look at the telephone situation which is referred to in the White Paper and look at the problems involved therein. It is admitted that the waiting list for telephones is high, 40,000, and the general quality of the service is less than satisfactory in a number of respects. That is putting it very mildly because we probably have the worst telephone service in the world. That would be a better way of putting it. Of course, we had an enormous long protracted strike, a devastating strike. It has been referred to several times today, but the people who were striking were working within a situation which was so parlous as to be able to produce a situation with 48,000 people on a waiting list.

I wish to refer to a book by Dr. D.A. Cogan of University College, Dublin, called The Irish Services Sector, A Study of Productive Efficiency. It is a rather frightening book. His comment on the same telephone communications system is as follows:

In communications expenditure has grown much more rapidly than revenue. Dissatisfaction with the quality of telecommunications has increased, particularly in rural areas. Telephone density is very low, yet the number of households waiting for a telephone is increasing. A large proportion of the country's telephone exchanges are manual at a time when international subscriber dialling is regarded as a basic business requirement. The extension of telecommunications to provide additional business services cannot be contemplated while primary telephone needs remain unsatisfied.

We get a whole tissue of disabilities one on top of the other. We have a disgruntled body of workers, an antiquated system and, obviously, bad management structures and a history of successive Governments, all concerned with economic planning, who have obviously ignored this central concern down through the years. The captains of industry tell us over and over again that if we have not got a good telex and telecommunications system we really cannot have a healthy economy. We have one of the most ramshackle telephone communications systems in Europe. There is a kind of pious hope that something is going to be done about that in the future but there is nothing in terms of a national plan in the matter, a plan for national development. The whole thing seems dismal.

If one cannot motivate people towards doing what Senator Mulcahy says, offering themselves as genuine enthusiastic workers within a society, what can one do? Are there areas where the Minister can do something which will have obvious results? There is one which strikes me—it strikes nearly everybody; people keep talking about it but nothing is done about it—and that is in the area of tourism. We have seen in our own time an enormous upsurge of huge grandiose road houses and restaurants, public houses in particular. Road houses, as they have come to be called in transatlantic parlance, are the worst. It has struck all of us that the standard of hygiene in them is deplorable. What kind of inspection do we have of such situations at the moment? For instance, if one goes into any public house on the road between here and Cork the chances are that one will go into a place which has a licence under the State and should be subject to certain laws of health and hygiene but which has unswept floors, uncleaned glasses, deplorable lavatories, no towels with which to dry one's hands and very frequently no taps under which one can wash them. What kind of inspection facilities exist here? The Minister for Health is sounding off at the moment about the importance of health and about us all becoming autonomous men and women looking after our health and hygiene but here is an obvious open area along our highways which we run into day in and day out. The situation is really dangerous but nothing is being done. That is an area of tourism and development.

Surely three of four energetic inspectors could bring these people to heel within a month and remove their licences. When was a licence taken from an Irish publican? If he has a few people in after hours his licence is endorsed but have we ever heard of a situation where the licence of an Irish publican was endorsed because he did not have a clean lavatory on the premises? One could go on all evening about this. Into these hostelries come the captains of industry and, indeed, the bureaucrats of Europe when they are here on holidays and these are the impressions that are made on them by our national image. It is understandable if they go back to their countries not at all impressed that this is the place to invest money or set up industries or that these are the most energetic and clean people in Europe. I am pointing to a national disgrace. I am not asking for any kind of miracle, I am not even asking for goodwill—the kind that Senator Mulcahy very properly asked for—I am asking for a good loyal lodger over them so that if they do not behave themselves close them down. We should not allow them to hang out a sign outside their door and we should make them take it down if they are found guilty of a breach of hygiene. I cannot understand why this cannot be done.

One thing I bring forward strongly to the Minister side by side with that is the deplorable standard of services. Culture shock is what one gets if one goes on the Continent now and notices how polite, pleasant and smiling people are. One gets culture shock in America because they even call one Sir. They smile but one could move through Ireland, through our hostelries, filling stations from one end of the year to the other and not get even the most basic courtesies. The standard is plummeting every year. I mentioned already in the House that de Gaulle, God be good to him, some years ago instituted a national smile competition and changed the face of France—a nice pun there. I was there the year they were not smiling and when I went back the next year everybody was smiling. He had given a prize for the best smile. Suddenly, they discovered it was as easy to smile, and I am sure the tips went up and things improved. There was not a very big prize awarded.

Perhaps it was only temporary and perhaps it was the untimely demise of the General that was responsible for it but certainly they are smiling more than we are. Dr. Cogan's book on this subject is extremely interesting. I have not the opportunity to read it into the records but I am surprised at the number of people who have not referred to this, to the chart which shows that our productivity in the tourist area of hotels and restaurants has gone down from .7 to .4 per cent between 1956 and 1971. There are terrifying figures of that nature in that book.

The other thing which is of great importance is education. The section dealing with education has the usual kind of honest platitudes on the entire subject. Of course, the recent report that has come out has shown us the situation we are in really. In that entire educational area the Tussing Report takes a totally different perspective. I urge upon the Minister in this area to quickly get a new report, a new survey of our educational needs, particularly with regard to the demographic population trends and so forth. It seems that we are putting the schools in all the wrong places at the moment. Suddenly, one sees some place like Malahide beginning to bulge and then schools are built there forgetting, of course, that when that generation of children have grown up there will be no need for that school at all. The abolition of central city schools on the grounds that one has to be where the actual generation of the children is taking place is another example. In fact, a central city school would be far more valuable. We had the kind of shrewd person who asks questions afterwards who brought in the free education scheme which is now proven to have gone off totally at halfcock. We also had the wild talk about getting the religious out of education when we suddenly realise that we have not the money to replace them, even if it was desirable that they should leave. A plan in education is definitely needed particularly at this crucial time when we are moving from voluntary schools to community schools. That is all happening far too quickly and under far too much duress and pressure. There should be another report along the lines of the Lynch Report, "Investment in Education".

The whole question of housing is so dreadful that I do not know how any Minister can face it, because prices are rocketing to such an extent that there is no way young couples getting married can survive on one family income. The entire structure of our society is threatened by the price of houses as they stand. There cannot be any way of solving it. At least in the tourism area there is something that could be done. I recommend those three rather random and unstructured suggestions to the Minister.

Mr. Staunton

I welcome the opportunity of addressing myself to the White Paper. I also welcome the presence of the Minister. I could not do better than take up where Senator Martin left off. I am a firm believer that in any plan or business there are certain critical elements affecting a multitude of proposed solutions. The present telecommunications situation here is a critical element in any plan for the development of our economy. In this plan we have the references for development in so far as telecommunications are concerned. Frankly, I find the reference entirely unacceptable and the suggestions of what might be done for the future to be a lot of platitudes. I do not think the section in question answers the needs of the country at this critical time.

I have observed the situation from where I live in the west of Ireland, my use of the telephone in this city, and some recent experiences I had in New York. I know the effect the telephone strike has had on future job prospects here. I know of the extent it has influenced critical American opinion in the industrial sector. The unfortunate aspect of it is that it is not today we are going to see the loss of jobs through the recent débâcle, for which I am not apportioning blame, but rather in a year or two years hence when the jobs that might have come on-stream in certain instances will not come on-stream for this reason.

In the White Paper we are told that the telephone service is the principal branch of telecommunications. We are told that the number of telephones per 100 of population and the percentage of telephones served from automatic exchanges is the lowest in the EEC. We are told of a waiting list of 40,000, that the general quality of service is less than satisfactory in a number of respects, that development of the service is expected to result in an increase in connections from 38,000 in 1976 to 64,000 in 1980, raising telephone density from the present 15 to 18 per 100 of the population. We are told also that widespread improvements were made in the quality of service and that it is planned to have 92 per cent of telephones served from automatic exchanges by 1980.

I do not think that is sufficient or adequate in this major and critical area. On an island such as ours where communication is of such vital import because we depend on exports and imports it must be singly the most critical element in our economy. This issue of telecommunications is so serious that in an age of limited resources, regardless of the importance of infrastructure in other areas, it is vitally necessary that the Government should act in this area and pour money into the telephone service, apart altogether from the wider issue of a debate as to whether or not it should be controlled by the Department of Posts and Telegraphs or whether it should be under the auspices of a semi-State body. I favour the latter proposition.

But that is not enough. We know the evils of borrowing outside the country. Recently we have been borrowing outside this country for purposes which are less than productive. Even if that is necessary, radical steps should be taken. In this section it is provided that we are going to have an increase in the number of connections. We are going to have 92 per cent of telephones served from automatic exchanges. This is not the answer. In talking about telecommunications I am not essentially talking about the recent strike. I am talking about the events that happened before that strike and the events that have been happening since the strike. While the strike situation was utterly chaotic, the situation is practically as bad in what are supposed to be normal conditions. The mere fact of having more telephones in the country is not going to solve the problem; neither will the fact that we are going to have more served from automatic exchanges. Having such a right proportion of automatic exchanges under the present modus operandi is going to result in a deterioration rather than an improvement in the telephone service. My experience is that I tend to get a much better telephone service from the town of Westport where we have single number and dual number telephones and where we have an old fashioned exchange with a number of telephone operators who work excellently. The service did extremely well during the recent strike whereas the extent to which the service has gone automatic has led to vast deterioration in the telephone system. I am utterly appalled at the situation which obtains on the automatic exchanges, particularly in this city where one can literally hang at the end of a telephone for hours waiting to get an answer from a telephone operator. We have had instances in recent months, and we know them to be true and not fantasy, of business people, especially those from other countries, getting into cars in Galway and driving to places like Newry and Enniskillen, and in some instances taking planes to London, to get their telephone communications moving out of this country. I am appalled to think of the extent of the intangible and unquantifiable damage which is done to output and agricultural markets and to fundamental industrial development embracing the employment of masses of people in construction, the training of people in through the AnCO system, the employment of people in production and in the services and the ultimate exporting from this country. The cost is so high that the Government, in defining those critical areas of telecommunications and telephones, telex and data transmission, should have seen that these areas were deserving of much more than the few platitudes which have been drafted in this section.

Having said that, I agree with a number of the criticisms of the White Paper. Unfortunately, because of the political realities, it has got to respond to the Fianna Fáil manifesto of the election of June last. To that extent it lacks the objectivity which a plan for the future is worthy of. In that manifesto there were elements which made it politically popular but which in my view were undesirable economically. Now they must be justified economically. There are political undertones running through it as well that in certain senses read like a fairy tale if we look at the introduction of the section.

Debate adjourned.