The Minister's statement will, no doubt, give satisfaction to a certain number of people, but I think the number of people is limited. The actual number is not yet available. I do not know whether the Minister can give the House any idea of the number of persons who are income tax payers and who will thereby receive some relief from this particular Budget statement and the resolution that is now before us.
I noted that the Minister adopted the usual attitude of the Ministers for Finance in this country and the Chancellors of the Exchequer in other countries. He seemed to create the impression, or endeavoured to create the impression, that the national credit was the equivalent of national prosperity; that when we have national loans at round about par, or a little above par, that is an indication that the country is in a state of prosperity. I am willing to agree that it will add something, or, at least, it will prevent some decline in prosperity which a fall in the national loan might possibly entail, but I think it is quite wrong to let the argument go without comment that simply because the national loan stands at 101, that is evidence of national prosperity.
So far as one can gather from observations, from the reading of statistical returns and from comments from business houses and agriculturists throughout the country, the state of the national loan in the market is not by any means a reflection of the state of economic prosperity in the country. I am sorry that the Minister's statement does not show an appreciation of the necessity for some positive act on the part of the Minister to remedy the very appalling state of things economically that we hear about or see in the country.
The reduction of income tax to 3/- will, no doubt, be heard with great satisfaction by a considerable number of people. I am not going to find fault with it, but I think it would be much more pleasing and much more beneficial if there had been some discrimination instead of making a flat-rate reduction—if there had been some discrimination and if some relief were given to that section of income tax payers who would re-invest whatever they save through this reduction in Irish productive industries. To speak of this reduction of income tax as being a necessary stimulus to industrial activity is, I think, fallacious. I do not know whether it is possible to analyse the figures that may be in the hands of the Minister, but if it were I am pretty confident in saying that the reduction in income tax will, in a comparatively small measure, find its way into productive enterprise or in re-investments. The economic effect will rather be that the saving of the shilling in the pound will be spent on new imported luxuries, with no economic effect of a productive kind in this country. That is perhaps too sweeping a statement— not no economic effect, but a small economic effect. I am willing to concede the point that there will be a minority of people, who have been endeavouring to live simply and within their means, who will continue on the same scale of living, and such relief to them as is occasioned by this reduction may find its way into capital expenditure in productive enterprises. But I think the chances are that the amount of stimulus that will be given by this reduction will be very small and that a much greater benefit would have been achieved had there been some discrimination and even greater relief given where it could be shown that the income had been re-invested in Irish productive enterprises.
The Minister has made a statement which I am not sure that I can appreciate to the full. It seems to me to be very doubtful wisdom and rather like a pre-election dodge to make a paper appearance of a surplus. He is disposing of half-a-million pounds, or thereabouts, and he finds that half-a-million pounds by saying: "We are going to think of the Army expenditure in normal times as being half-a-million pounds less than it is at present, and we are going to consider that half-million pounds, which we are taking for the relief of income tax, as being abnormal, and borrow for the purpose of meeting that sum of money." I cannot appreciate the Minister's argument that it is fair to take the Army Estimate of £2,183,000, reduce it mentally by half-a-million pounds, and say: "We shall borrow that sum because it is abnormal," and to do the same with £53,000 worth of Army pensions, and borrow against that for the purpose of finding money to remit to income tax payers. I do not think it will stand examination by any careful finance expert. It is rather, I suggest, a financial dodge, the dodge of a Chancellor of Exchequer or Minister for Finance who wants to put before the country a somewhat popular Budget, at least to that part of the community which pays income tax, and to say: "Well, we are going some day in certain circumstances to reduce the Army to smaller proportions, and we are going to borrow one-fourth of this current year's expenditure."
I do not want at this stage to repeat the queries which I put to Ministers on more than one occasion, but I will suggest, for the consideration of the Dáil, that if this Army, which is going to be transformed, is in fact to be a protective force, to be, in the words of the Minister, "sufficient to protect the wealth and territory of this country against external attack," that there will be a considerable sum of money required for defence work, which is not merely the maintenance of men, but defence works, expenditure of various kinds which are not contemplated in the £2,183,000 which form the sum in the Estimates as required for the Army. If there is to be this protection against possible external attack you will have to meet that out of current revenue, and you are not justified in borrowing £500,000 odd to meet the expenditure on the Army for this year and treat it as non-recurrent.
I am sorry that the Minister has not given us some hint or promise that it was the intention of the Government to provide moneys to meet the very clamant needs of hundreds of thousands of people in various parts of the country. There are many people who will not have much thought of the finance statement of the Minister, will not be very pleased to know that income tax is to be reduced by £500,000, and that no definite, positive steps are to be taken to relieve them of the very imminent peril of death by starvation. The Minister has taken some credit for his promise to meet the calls of his critics by setting up a Departmental Committee, to be presided over by some Ministers, with a view to retrenchment in Civil Service charges. I take it that the assurances that were given last year and in previous years, time after time, were really not warranted, because I think it will be remembered that all that he is now promising has been in operation for two or three years past, that there has been a very rigorous examination of departmental expenditure, and that the result of that examination has been to confirm the Minister in his frequent statements that the utmost economy is being exercised. Therefore I take it that the promise regarding a Departmental Economy Committee is merely so much fudge, because it has already been in operation, and I would prefer to take the Minister's assurances in previous statements to that of this particular statement. If we were only to add the number of times together that such assurances have been given, the majority has it, the economy has been practised, there is nothing further to be gained by this new Committee, simply by the fact that it will be presided over by a Minister.
But I would suggest that it might be worth the Minister's while to take some trouble to find out whether some economy of the right kind, economy because of public satisfaction, economy in more contented service, could not be achieved if he were to consider the situation within the Civil Service, consider with a little more sympathy the calls and pleas and demands of civil servants for consideration of their grievances. I have reason to believe that there exists in the Service a considerable amount of irritation and dissatisfaction, and that will not be removed by examinations into economy; it is much more likely to be removed by some sympathetic consideration of the claims that the Civil Service is putting forward.
Credit was claimed by the Minister, and I have no doubt that from his point of view as a collector of taxes the utmost credit is due to the Revenue Commissioners for the manner in which they have succeeded in abstracting blood out of stones. I am not sure, though, that, for the sake of giving a somewhat satisfactory report to the House on the Budget day, it is good public policy to attempt that process of abstracting blood from stones. I think it possible that you might be doing much more harm to the economic stability of the country by that particular kind of process, that a little more leniency and a little more consideration of the circumstances of the individual who is called upon to pay is due. I am thinking at this moment more particularly of notices which have been given to workmen in receipt of under £4 per week informing them that for a certain number of weeks they shall have deducted from their pay a sum of 50/-. Now, when you ask a workman who is receiving £3 10/- to £4 per week to hand over £2 10/- per week out of his pay for a certain number of weeks and when you say that it must be deducted, it is not likely to inspire respect for Governmental institutions, and I think that there are other Deputies who could instance a process equally indefensible in respect of other classes of the community.
The statement that the Minister has made will be read by me and by others with care and, I am sure, with a good deal of interest, and we shall have opportunities of examining it and discussing it with more detail and with a better understanding. But I do commend to the House and to the public this idea, that they are not by any means to take to themselves the satisfaction that because the Budget shows a surplus ,and because the National Loan stands at a certain figure which appears satisfactory, that is ample evidence of the general prosperity of the country.