Dáil Éireann díospóireacht -
Wednesday, 20 Feb 1929

Vol. 28 No. 1

In Committee on Finance. Financial Resolutions. - Motion No. 2—Customs.

1. That the duty chargeable under Section 16 of the Finance Act, 1925 (No. 28 of 1925), as amended by subsequent legislation, shall in the case of personal clothing or wearing apparel wholly or partly made of woven tissues made wholly or partly of wool or worsted and imported into Saorstát Eireann on or after the 21st day of February, 1929, be charged, levied, and paid at the rate of twenty per cent. of the value of the article in lieu of the rate mentioned in said Section 16.

2. It is hereby declared that it is expedient in the public interest that this Resolution shall have statutory effect under the provisions of the Provisional Collection of Taxes Act, 1927 (No. 7 of 1927).

Minister for Finance (Mr. Blythe)

These resolutions are the most important items on the Order Paper to-day. They arise out of a report which has been received from the Tariff Commission on the application for a tariff on woollens and worsteds. The report has just been received, but the matter which it dealt with was familiar to most members of the Executive Council, because applications had been made very frequently to Ministers and to the Executive Council as a whole for a tariff on woollens before the Tariff Commission was set up, and when the report was received yesterday the members of the Executive Council were in a position immediately to act upon it. They thought it well to act upon it as rapidly as possible for the reason that any delay might lead to information getting abroad that a tariff was to be imposed. In all cases in which there is any question of a tariff a certain amount of speculative forestalling takes place. Speculative forestalling is not such a very serious matter. What is serious is when people get to know that there is a certainty of a tariff. In such cases what is liable to happen, and what has happened in previous instances when people, if they had not at least certain information that a tariff was going to be imposed, had a very good idea, was that such quantities of goods were imported as damaged the factories working here for a very considerable period, although they got the advantage of the tariff. This application for a tariff on woollens and worsteds is the biggest proposal that the Tariff Commission has had before them. The only other proposal that was comparable to it was the proposal in relation to flour. Although the value and quantity of flour imported are greater than the value of the woollens and worsteds imported, yet from the point of view of actual employment that is given, or may be given, the application for a tariff on woollens is, I think, vastly more important. It is more important for another reason, that the prospects of the woollen industry are greater. So far as flour is concerned, I think the most that could be hoped would be that it would supply the internal needs of the Saorstát. So far as woollens are concerned, there has always been a considerable export trade in woollens, and a tariff which would give the woollen manufacturers the home market would perhaps lead to increase in their efficiency, add to their resources, and perhaps give them an opportunity of very considerably increasing their export trade. For that reason I think the application for a tariff on woollens and worsteds is really vastly more important than even a flour tariff.

This matter has been before the Tariff Commission for a very considerable period. It was referred by me to the Tariff Commission on the 25th February, 1927, and has occupied a very great deal of the time of the members of the Tariff Commission since. No less than 52 meetings of the Tariff Commission have been held for the purpose of considering the application and drafting the report. About 11 of these meetings were open to the public. In addition to the meetings which the members of the Tariff Commission have had, they have individually had to study a great mass of documents relating to it, and great masses of accounts had to be examined, so that it has imposed a very great strain on the members of the Tariff Commission, much more in proportion than I think any of the applications that have been before them. There were 20 firms of woollen manufacturers associated with the application for a tariff—all the major woollen manufacturers in the country. The smaller manufacturers who were not associated with the application for a tariff do not, I think, manufacture any very great percentage of the cloth made in the country. We have had joined in the application:— The Athlone Woollen Mills Co., Ltd., Athlone; Bantry Woollen Mills, Ltd., Bantry; City of Galway Woollen Manufacturing Co., Ltd., Newtownsmith, Galway; F. and J. Clayton and Co., Ltd., Navan, Co. Meath; J. Cogan and Sons, Midleton, Co. Cork; The Convoy Woollen Co., Ltd., Convoy, Co. Donegal; Dripsey Woollen Mills Co. Dripsey, Co. Cork; Glanworth Woollen Mills Co., Glanworth, Co. Cork; Harold's Cross Woollen Mills Co., Harold's Cross, Dublin; S. Heaton and Sons, Ltd., Lock Mills, Athlone; Hill and Sons, Ltd., Lucan, Co. Dublin; Kilkenny Woollen Mills, Ltd., Greenvale, Kilkenny; Martin Mahony and Bros., Ltd., Blarney, Co. Cork; Morrogh Bros. and Co., Ltd., Douglas, Co. Cork; Mulcahy, Redmond and Co., Ltd., Ardfinnan, Co. Tipperary; O'Brien Bros., Ltd., Douglas, Co. Cork; James O'Flynn and Sons, Ltd., Sixmilebridge, Co. Clare; The Ormonde Woollen Mills Co., Kilkenny; Providence Woollen Mills, Foxford, Co. Mayo; C.J. Shehan and Sons, Ballinamuck, Dungarvan, Co. Waterford. So the Deputies will see that all the principal mills of the country have been associated with the application. The original application was for a tariff of 25 per cent. on all woollen and part woollens and worsted and part worsted cloths of a weight of seven ounces per square yard and upwards. Cloths include serges, meltons, clerical cloths, friezes and other overcoatings, fancy worsteds, etc. And further, that the existing tariff of 15 per cent. on blankets and blanketing and rugs should be increased to 25 per cent. After some time the latter part of the application was withdrawn—that is, the part with reference to increasing the present tariff on blankets and blanketing and rugs.

The fee of £100 for the hearing was paid by the applicants on the 21st May, 1927. Notice was given in the daily papers on the 27th May, 1927. On the 20th June, 1927, Mr. Goodall, of Cork, filed a statement on behalf of the Irish Free State Wholesale Clothiers' Association claiming to be heard in opposition to the application. On the 22nd June the Woollen Distributive Trades' Protective Association and Irish Merchant Tailors' Association claimed to be heard in opposition, and they nominated Mr. Goodall to file a statement of their case. The same gentleman on the 28th June filed a statement on behalf of the Leinster Laundries Association claiming to be heard in opposition to the application. Then there was a joint request from Messrs. Magennis and Co., representing the applicants, and Mr. Goodall, representing the opponents, made upon the 3rd August, 1927, asking the Commission not to fix an earlier date than the last week in September or the first week in October. As a matter of fact the public sittings did not commence until a little later than that, but in the meantime applications and documents relating to it and evidence of various kinds, including printed evidence and literature in relation to the woollen trade, had been very carefully studied by the members of the Commission. A considerable number of people were heard both for and against the tariff. Mr. C.P. McCarthy, of the firm of Messrs. Magennis and Co., was heard in favour of the application; so also were Mr. Wm. Cronin, Director Dripsey Woollen Mills; Mr. John C. Munroe, Director, Messrs. Morrogh Bros., Cork; Mr. Edward T. Mahony, Director, Messrs. Mahony Bros., Ltd., Cork; Mr. Andrew O'Shaughnessy, Director, Dripsey Woollen Mills, Cork; Mr. John T. Telford, Managing Director, the Athlone Woollen Co.; and Mr. Alexander Weir, the Convoy Woollen Co., Donegal.

Against the application there was heard a considerable number of witnesses, including——

Mr. Fahy

May I ask the Minister one question, that is, whether the Commission heard the Minister for Agriculture in opposition to the tariff?

Mr. Blythe

The Minister's name does not appear here on my list, but there were heard against the tariff: Mr. Callanan, of Messrs. Fallon, Callanan and Co., Lower Bridge Street, Dublin; Mr. Patrick Hanna, Limerick Clothing Factory; Mr. Wm. Dwyer, of Messrs. Lyons and Co., Cork; Mr. John P. Twomey, of Messrs. Jonathan Richards and Co., cap manufacturers, Dublin. On behalf of the Woollen Distributive Trades Protective Association there were heard: Mr. John O'Connor, Manager of Messrs. Ellis and Co., Dublin; Mr. O'Sullivan, of Messrs. T. Lyons and Co., Cork; Mr. Wigglesworth, of Messrs. John G. Hardy, London; Mr. Fitzgibbon, as representing McBirney and Co., Ltd., Limerick; and a considerable number of representatives of the other various trades that were opposing the tariff.

In addition to hearing all these witnesses the members of the Tariff Commission visited a considerable number of mills, both here and in England and in Scotland. They had the assistance of various experts and people with technical knowledge. As a result of their consideration of the application and of the evidence in support of it, and all the evidence against it at the Tariff Commission, they made the following recommendation:—

"We recommend the imposition of a customs duty of an amount equal to 25 per cent. of the value of the article on all woollen, part-woollen, worsted and part-worsted woven tissues imported in the piece into Saorstát Eireann, and weighing 7 ounces per square yard and upwards. We recommend that there should be an Imperial preferential rate equal to four-fifths of the full rate. We consider that where the value of the tissues does not exceed 1/6 per square yard, that is, approximately 2/6 per trade yard, they should continue to be imported free of duty. The duty which we now propose is not intended by us to apply to blankets, blanketing and rugs, on which, we presume, the existing duty of 15 per cent. ad valorem will continue to be levied.

"We consider that the Revenue Commissioners should be empowered to admit, free of duty, tissues of a character akin to blanketing or felt which they are satisfied are suitable for, and intended for use, (a) in the manufacture of harness and saddlery, (b) in the printing trade, and (c) as ironing cloths in laundries and the tailoring trade.

"We also consider that in cases where manufacturers of ready-made clothing in the Saorstát secure contracts for the making up of garments for export from specified cloths delivered to them for that purpose by the other party to the contract, facilities should be provided for the importation of such cloths free of duty.

"We recommend that the existing duty on wearing apparel be increased from 15 per cent. ad valorem to 20 per cent. ad valorem in the case of articles made up wholly or partly from woollen and worsted woven tissues, and that the increased rate should apply irrespective of the weight and value of such tissues."

An Leas-Cheann Comhairle

took the Chair.

Mr. Blythe

The Commission is satisfied that the woollen mills of the Saorstát are on the whole, to use their own words, "reasonably efficient."

As Deputies will gather, the tariff will not apply to the whole range of cloths. First, cloths under seven ozs. will be free. That means that a quantity of cloths which are not at present manufactured in the Saorstát and are used chiefly for ladies' wear will not be affected; secondly, cloths the value of which does not exceed 1/6 per square yard will not be taxed. That means that cloths of the shoddy variety which are used for very cheap clothing and for the manufacture of very cheap ready-made clothing will not be affected.

The capacity of the Saorstát mills seems to be about a half a million yards under the total requirements of the country for woollen and worsted cloths. But when we take into account that a considerable quantity of the two classes of cloths will be exempt from tax it may be assumed that the present capacity of the mills is equal to supplying the entire requirements of the country in the class of cloths to which the tariff will apply. As I have already indicated, the woollen industry has a considerable export market. That is an indication in itself that there is a good deal of efficiency and enterprise in the industry, and, consequently, it seems to be an industry in which it may safely be taken that there will be a considerable amount of internal competition; and it is believed that while there may be some increase at the beginning, especially at the beginning, in the price of cloths of the kind in ordinary use as made by these mills, that ultimately the increased price that will be paid by the consumer as a result of the tariff will be small.

There will be a special class of cloths which the mills will not make here, or perhaps will not make here as cheaply as the more ordinary variety, and so far as they are concerned there will always be a tax. But people who want a special, unusual, exclusive design, or people who want cloths of a special kind for their garments, will continue probably to have to pay substantially in excess of the present prices. But so far as the people who are wearing the more ordinary and usual grades of cloths are concerned, the view of the Commission is that the increase so far as they are concerned will not be considerable. That, of course, is a matter about which nobody can be sure. But, at any rate, in granting a tariff here this much is certain: that we are dealing with an industry that has a good tradition behind it. We have mills at present which rely mainly on export trade. We have mills that when the whole of the difficulties of the post-war slump came upon them set out to recover the markets abroad, and they successfully recovered them. They compete in these markets under the adverse circumstances that they have to face.

So far as shoddy is concerned that is a trade which consists in making cloths from wool which has already been used—from reclaimed wool. It is a trade in which special skill is required and in which more expensive machinery is required than in the manufacture of cloths from what is called virgin wool. The use of reclaimed wool has not taken place to any great extent here. It is not correct to assume that there is no use of reclaimed wool in the Saorstát mills. In some of the Saorstát mills there is the use of reclaimed wool and, in fact, to some extent all the processes concerned with the manufacture of shoddy are to some extent carried on in the Saorstát mills. Some mills have argued that they ought not to carry it on at all, that it would injure the reputation of their cloth, but the Tariff Commission is not satisfied that that is so. There are many countries which manufacture a low class cloth and a high class cloth and the reputation of the high class cloth does not suffer because of the fact that in the same country cloths of a cheaper quality are manufactured. It may be that progress will be made with the manufacture of this cheap quality cloth in the Saorstát mills. But the fact is that at the moment, for the very cheapest cloths which are used to any appreciable extent by the manufacturers of ready-made clothing here, the Free State mills could not supply the demand. For that reason the Tariff Commission has come to the conclusion that cloths of a value of 1/6 per square yard or under should be exempt from the duty.

The proposal for having an imperial preference rate is made by the Tariff Commission because of the export trade which the mills here have, and because they believe that the giving of that imperial preference rate would be an advantage in solving the marketing problems in the export trade. The result of that will be that so far as the great bulk of the imports of woollen and worsted tissues is concerned, the effective rate of the tariff will be 20 per cent. It is necessary, of course, when woollens and worsteds are being taxed that some adjustment should take place in the apparel duty. The present tariff on apparel is 15 per cent. But having gone into the matter at some length the Tariff Commission came to the conclusion that an increase of 5 per cent., that is a tariff of 20 per cent. would reasonably meet the case of the wholesale clothing manufacturers, taking into account that for a certain part of their trade they would have a 20 per cent. tariff without having any duty on the cloth. After consultation with the Revenue Commissioners, the Tariff Commissioners came to the conclusion that when they were dealing with apparel it would not be practicable at all to take into account or to endeavour to ascertain what was the value per yard of the cloth in the garments, or that it would not be very practicable or easy to put 20 per cent. on garments which had cloth of a certain weight and have 15 per cent. on garments which had cloth of a less weight. Consequently the proposal is that on all made-up garments, containing woollen and worsted woven tissues, the duty for the future should be 20 per cent. instead of 15 per cent. That figure was fixed approximately taking all things into account leaving the manufacturers of the ready-made clothing with the same amount of effective protection as they have at the present moment.

It is anticipated that the tariff will speedily lead to the employment of a thousand more people. Of course, a further increase in the amount of employment given will depend upon the developments which are not so easy to foresee. It is anticipated that in the first year the revenue result of the tariff, including the tariff on woollens and worsteds in the piece and the additional tariffs on manufactured garments, will be about £150,000. It is expected that amount will very steadily and rapidly decrease, and that the amount to be obtained out of this tariff will finally be the amount that will be obtained practically from luxury cloths of one type or another.

The motions which I will move are motions made under the Provisional Collection of Taxes Act. If passed by the Dáil they become effective immediately, so that the taxes can be collected. They lose their effect if, within ten sitting days of the Dáil, they have not been passed on Report. If they are passed on Report, then the Second Reading of a Bill ratifying them must be passed within a certain limited period also. The need for this procedure is, as Deputies will understand, to prevent goods being rushed in when a tariff is mooted, and so escaping duty. It is never possible on such occasions very effectively to discuss a proposal when the Resolution is first moved, because Deputies cannot have been informed of it in advance, and they cannot have had any opportunity of hearing from members of the public who are particularly interested in the matter. What Deputies do when they pass such a Resolution is: they determine that if such a tariff is to be imposed traders will not be able to get around it by large importations before the tariff becomes effective.

The report of the Tariff Commission, as I have said, has just been received. It will be passed to the printer now, and will be circulated to Deputies as soon as possible. I gather from the members of the Tariff Commission that it probably could not be circulated before this day week or to-morrow week, because in printing it the calculations will have to be checked and figures will have to be checked, so that the errors that might pass in the typescript documents may be rectified and so that there shall be none of those casual errors. The printing, therefore, will be a little slower than if the Executive Council had the report for a week or ten days and these matters could have been going on in the meantime. Therefore, pending the circulation of the report to Deputies, the consideration of it by them and the raising of such questions as may occur to Deputies on examination of the report, I think it is not necessary that I should say any more at the moment. I move the resolutions.

Mr. Lemass

I do not think that it should be necessary for me to say that these resolutions will receive the support of Deputies on this side of the House. I do not intend to speak to them at any length now, as we will have an opportunity of examining them in detail ourselves, and also, I understand, of examining the report of the Tariff Commission before the motions come up on the Report Stage. In view of the fact that the resolutions must come up on Report within ten days——

Mr. Blythe

Ten sitting days.

Mr. Lemass

—it might be advisable if the Minister would consider it possible to put one copy of the report in the library, so that it would be available for those who would like to have an opportunity of examining it at greater length than would otherwise be possible if we were to wait for the printed report. I hope some means will be found of giving effect to that suggestion. The report of the Tariff Commission, while satisfactory, could not, in my opinion, have been other than it was. Those of us who had an opportunity of examining the facts relating to this industry long ago became convinced that they were of such a nature as to break down any free trade prejudices that might exist either in the Tariff Commission or the Executive Council and ensure the granting of the application of the woollen millers.

The Minister for Finance stated that this industry is already doing a substantial export trade. I think that for the year 1926—that is the year to which the Census of Production figures relate —the actual quantity of cloth produced in Saorstát mills and exported exceeded the quantity sold within the country. There is no doubt whatever that the industry is one capable of very considerable development. It seems to me that if it is given any reasonable opportunity, at the end of a very short period this export trade should represent by far the greater portion of its total production. I note the Tariff Commission anticipate that 1,000 extra employees will be taken on almost immediately as a result of the imposition of the tariff. That is all the more satisfactory in view of the situation which existed heretofore when a large number of the mills were working only part-time. I think over 50 per cent. in 1926 worked less than 100 days. The additional amount which will be paid to Irish workers in consequence of these resolutions will be considerably in excess of the amount that the 1,000 additional workers will earn.

I must say I do not feel convinced by the reasons given by the Minister in support of the resolutions bringing these duties under Section 8 of the Finance Act of 1919 and providing that imperial preference will be given in respect of them. It seems to me that the most hopeful field for the development of an export trade in Irish woollen cloth is not in Britain, but in the United States of America. If any special rate should be given at all it should be given in favour of the goods of that country in which we hope to sell the products of this industry. It is true the British woollen millers are themselves seeking a tariff. I am now speaking from memory when I say that I think that tariff only applies to cloths under the weight specified in resolution No. 1 here. I may be incorrect in that, because I am speaking only from memory. In any case there is a highly developed woollen industry in England, and it does not seem likely that Irish mills, no matter how efficient, would be able to penetrate the British market to any extent except in special classes of cloths, such as hand-woven tweeds, which find sale in consequence of their original designs and for other reasons than their commercial value.

If the Minister is speaking again on this matter. I would like him to go more fully into the reasons for proposing Part 4 of the Resolution relating to imperial preference. I am not satisfied that it is wise national policy to exclude from the operations of this tariff cloths of a value of less than 1/6 per square yard. It seems to me that the actual wearing value of these cloths is not represented by the price charged for them. If, as stated before the Tariff Commission, Irish mills could produce cloth to the value of 3/-or 3/6 per square yard, its value to the purchaser as a suit of clothes would be much superior to that of imported shoddy at less than 1/6 per square yard. It seems to me that we could in the course of time educate our people to realise that it is better economy to purchase Irish cloth at a slightly increased price than to purchase imported worthless goods which seldom, if ever, survive a shower of rain. In any case it is not unlikely that the importation of shoddy cloth will be greatly increased as a result of the operations of the tariff in this particular way. The increase of the duty now in operation upon wearing apparel made partly of woven tissues is a step in the right direction. It was, no doubt, necessitated in any case by the fact that the tariff was being imposed upon the cloth, but the trade statistics which are now available indicate that the existing tariff of 15 per cent. on wearing apparel was totally inadequate. No doubt it resulted in the establishment of new factories and gave additional employment. I have not had an opportunity of examining the returns relating to employment which were laid on the Table of the House to-day by the Minister for Industry and Commerce. The trade figures for the first nine months of last year indicate that there was a substantial increase in the importation of wearing apparel as against the same period in the previous year. The increase in the duty on these goods will effect an alteration in that position, and will still further increase the amount of employment which that duty gives to Irish citizens. On the whole, I am very glad to know that the view expressed by the Minister for Agriculture at a recent meeting did not operate to prevent the Executive Council doing its obvious duty in connection with this industry. I hope when applications for tariffs on other goods come before the Tariff Commission and the Executive Council in future that the views of the Minister for Agriculture will be again ignored as they ought to be.

Mr. T. O'Connell

Deputies on these benches will support the resolution, but we are at a grave disadvantage in discussing it at this stage by not having the Report of the Tariff Commission before us. There are one or two points on which I would be glad to hear further argument, and to read the comments of the Commission in regard to them. One is the point mentioned by Deputy Lemass in regard to cloth under the value of 1/6 a yard. I do not think that the Minister made it very clear—certainly he did not, in my opinion, convince the House—that this particular type of cloth costing under 1/6 per yard should be admitted free. As I say, I do not wish to comment very much on that until I read the argument put forward by the Tariff Commission. I take it from the Minister that the Commission made that recommendation, and I take it that they have put forward some substantial arguments in its favour. My view coincides with that of Deputy Lemass, namely, that it would be a good thing for the country if shoddy could be kept out. I think it is really a temptation to people to buy shoddy cloth. Our poor people really suffer considerably in health from the fact that they are tempted to purchase such cloth because it is low in price. That temptation will, in my opinion, be increased under this regulation. I notice that the Minister did not dwell to any great extent on the question of the possibility of mills, not so much mills perhaps as retailers, putting up the price of cloth because of this tariff. When a tariff was put on margarine undertakings were given that the price would not be put up, but there is no mention of any undertaking of that description in this case, or no mention of any steps that could or might be taken. I do not know if it would be practicable to take steps to prevent the price of cloth being substantially raised as the result of the tariff. I think the danger lies more with retailers than with manufacturers. The Minister spoke of the possibility of competition, of having much competition in the country among various mills, and he said that that would have the effect of keeping down prices. I think it would be an advantage if there were co-operation and reorganisation among mills in the Saorstát, so that each mill would not be producing a large or wide range of different types of cloth. There might, for instance, be an arrangement by one, two, or three mills to produce one type of cloth and amongst others to produce another type. That would have the effect of increasing output. While that would be good, you might have a combination to put up prices. I do not know whether there is anything suggested in the report of the Tariff Commission to prevent that. As I say, we cannot discuss these points usefully until we have the report of the Commission before us. At present I just want to say that in view of the fact that this tariff will have the effect of giving employment and of reducing unemployment we will support the resolution.

Mr. MacEntee

There is one point mentioned by Deputy Lemass which might be reinforced in reference to Part 4 of the Resolution which relates to preferential tariffs. I have been looking up the figures for imports for the year 1927. I find in regard to the part embodied in the resolution that the tariff, instead of being 25 per cent., will be 20 per cent. The total imports of woollens and worsted tissues during 1927 was 5,242,477 yards, the value of which was £968,859, while the total imports which would not be entitled to a preferential tariff amounted to only 64,700 square yards, to the value of £9,892. I submit that if the manufacturers applied before the Tariff Commission for a tariff of 25 per cent. they had in mind a tariff which would give them protection against their main competitors. They experienced practically no competition except from the mills in Great Britain and Northern Ireland. It does not, I think, meet the case of the applicants who applied for a 25 per cent. tariff if the Government in appearing to concede that tariff only give them in fact a protection of 20 per cent. In view of these figures I think the Minister, if he is going to reply, ought to devote some of his remarks to justifying Part 4 of the Resolution.

Mr. Anthony

Personally I welcome this very practical contribution towards constructive statesmanship on the part of the Minister. Speaking for a district in which there are two villages, Douglas and Blarney, manufacturing tweed and cloth of a very superior character. I believe the tariff will be welcomed in these particular districts. However, there is one portion of the Minister's statement dealing with cloth which is used in ladies' clothing from which it would appear that this cloth will very largely escape the tariff duty. I am not going to suggest that at the present day ladies wear very much clothing, but, anyway, such as it is they are the largest sinners in this respect in regard to imported clothing. I do hope that at some future date the Minister will be able to introduce a tariff in this regard which will have the effect of making the chief sinners in this respect purchase cloth manufactured in this country.

There is an aspect of the question to which I would direct the attention of the House—namely, the importation of shoddy. There is unquestionably a demand for this class of material in the country. We know it from the returns given from time to time of the imports of this particular article. I want to make a serious suggestion. If there is such a great demand for shoddy, why should not shoddy be manufactured? The Minister stated that certain ill effects would follow from such a policy. I am aware that it might be said that because a certain manufacturer went in for making shoddy it might reflect on his concern. At the same time I suggest that it is important to impress upon manufacturers in the Saorstát that they should endeavour to cope with this demand. I admit that it might not be a very laudable thing to suggest that we should manufacture inferior articles, but the fact is that the demand is there for it. If it pays the English manufacturer to dump and sell shoddy, I seriously suggest that some of our Irish manufacturers ought to go in for the manufacture of such material. It might not be considered a very noble thing by some people, or it might be considered unpatriotic to suggest that we should manufacture anything in the nature of shoddy, but as I have already said, there is a demand for it, and it is up to our manufacturers to meet that demand and to instal machinery to meet it.

Mr. Flinn

I have more pleasure in supporting this tariff and less anxiety in relation to supporting it than in relation to a good many other matters. In the first place this is a trade which is specially suitable for the country and for which the raw material can effectively be produced in the country. In the second place it is a trade which is widely distributed and made up as a rule of small units which have local associations and what is very valuable in this matter, a local loyalty. It is one of the few trades which, as far as I can see, can by reasonable means, by reasonable loyalty and reasonable co-operation within the elements of that trade, be saved from any considerable danger of peaceful penetration. That and the local flour mills are probably two of the trades which can be held most immune from that influence. I had the pleasure a few days ago of speaking at a meeting in relation to a tariff of this kind which meeting was peculiar in the sense that it had upon its platform men of different political parties. I am glad to see that in relation to this particular tariff there is going to be reproduced in this House that same condition and that an economic measure which is for the good of the country is going to be backed not by a party but by the country, against an interest if necessary. There were not merely absentees from such a platform but there were deliberate abstainers from such a co-operative platform of opinion in this country in relation to this particular tariff.

I am not sorry at all that that difference between the main body of opinion and a section of the opinion of the country should be brought out definitely on this matter. The State in relation to this particular industry is going to do its share. I agree with Deputy MacEntee that in regard to the difference between twenty and twenty-five per cent. the Minister may be making a mistake. My information is that that difference of five per cent. may make all the difference between the large effectiveness of this tariff and its less considerable effectiveness. I hope the Minister may have more information—he has certainly the report which we have not—but my information is that that five per cent. is a critical difference and should be considered as such.

Now, if the State is going to do for these mills and for the industry its share, I think the State is entitled to ask of those mills that they also shall do their share in any matter in which co-operative effort, understanding and arrangement between them will enable this industry to be more effectively dealt with. It is suggested that particular manufacturers will not like to have their names associated with the manufacture of shoddy, of cheap material which is being used and will be required to be used, in my opinion, in this country for some considerable time. I know from personal contact with manufacturers that they do not want their names associated with that. I think they are very wise, because in a small and poor country of this kind if we are going to get an export trade it will be in speciality and quality goods and not in mass production, and the manufacturers are very wise to be very cautious and very chary of the association of their names with anything of that kind. But that does not get over the difficulty. There will still be that import and consumption of that stuff, and the suggestion which I would be inclined to make to them is this, that this is one of the things in which they can co-operate with that trade. They can set up a mill which is not the mill of any one of them, which is the mill in which they will, as members of the trade, take shares and be responsible for the manufacture without a definite association of that particular quality goods with their own particular manufacture.

The same problem arises in relation to the manufacture of worsteds. None of the mills can afford, nor would it be profitable for them, as far as I can understand, to set up a worsted spinning plant of their own, but there is room in the Saorstát for a worsted plant which would belong to and which would serve the general body of the manufacturers. A great deal of worsted thread is at present being imported into this country, and it is up to the woollen manufacturers of this country to take in co-operation the steps which are necessary to manufacture for themselves that particular stuff.

Again, there is another line in which co-operation is possible. I am suggesting that, as the State is doing its share, it is entitled to some extent to require that those to whom it is giving this concession shall meet them in this matter. It is in the question of design. If you go into any of the mills in Ireland at present, and I have been in most of them, you will certainly be amazed at the variety of designs which very little mills seem to be able to turn out. I was in a mill the other day, a relatively small mill in Ireland, and it was turning out everything from fine clerical cloths to homespuns, and apparently nearly every grade in between. I think there is an individual quality in relation to those mills which they are not merely entitled but in my opinion bound to maintain, because it is only upon quality goods that we can look for any large export trade which will be available to us. While maintaining as far as possible that individuality, there is something to be said for research in designing, for a co-operation department in which the knowledge and training of the skilled man which cannot be afforded by any particular one of those mills will be made available for all of them.

I would like to raise this point for further consideration later. The Minister is going to get out of this £150,000 of revenue. Now I suggest for the purpose partly of taking the temptation away from his successor that there should be a segregation of the income obtained from tariffs for the purpose of production. I mean for definitely productive and development work in manufactures in this country. There is a great temptation, and to some extent it is to the credit of the Minister for Finance that last year, faced by an awkward position in the Budget, he did not fall for it. There is a temptation to find in the emergencies of a Budget reasons for introducing particular tariffs at particular times, and if it were understood that money which was obtained by tariffs would be segregated, as, for instance, money taken from petrol and motor-cars should be segregated for roads for the purpose of development, great temptation would be taken out of the way of future and, of course, much weaker Ministers for Finance.

There is another point, and in this perhaps we may have later, as we have had already, the co-operation of the Minister for Industry and Commerce. We must build up an export trade in these things. In relation to a particular woollen manufacturer in Ireland who attempted to use the port of Cork, and the liners which were plying in the port of Cork, for the purpose of exporting his goods, on application to the liners for the purpose of that export he was told that they could not do so owing to certain restrictions by the Cork Harbour Board. That complaint, which probably ought to have come direct to Cork, came first to the Minister for Industry and Commerce. He transmitted that complaint to the Cork Harbour Board, and as a result the Cork Harbour Board altered the basis upon which dues were charged on liners so as to enable these goods to be exported from the port of Cork in the liners going out from there. See what happened. They could not export them because the dues position was of a certain kind. We altered the dues position to enable those goods to be exported, and immediately those goods came forward to these liners the application to carry them was sent to the head office in Liverpool. The answer has come back that, as a special case and as a definite exception, this particular consignment of woollen goods— it is from the Ardfinnan Woollen Mills —would be carried, but in future every such consignment must go through Liverpool. Now, it will be very little use our putting on a tariff, it will be very little use our engaging in other activities of that kind, if in order to develop the export trade the transport system out of this country is going to use our ports simply and solely in furtherance of the policy that their export is human being and not manufacturers. I think the Minister for Finance, in co-operation with the Minister for Industry and Commerce, and we will welcome their co-operation in this matter, should go into the question of seeing whether difficulties of that kind may not be very definitely met. Personally I am very glad to see this particular tariff. As I said before, it applies to an industry which has great traditions in the country and which is in itself eminently suitable for the country, one whose development will have very great social advantages and whose distributive industry at the present moment is of a kind which we want to develop. I think in offering this co-operation to this industry from this House, at the same time there ought to go out a message that if differences between themselves—prejudice and lack of co-operation—are interfering with the development of the industry, to any extent to which a development of closer union and co-operation between them will produce better results, this State is entitled to expect of them that co-operation.

Mr. Good

The rules and regulations of this House in connection with propositions of this kind place Deputies in a difficulty. We are asked to approve in the resolutions that have been put before us of the imposition of certain tariffs before we have the facts and figures from the Commission to consider, and to come to a conclusion as to whether their decisions were wise or otherwise. That is a difficulty that I personally feel very keenly at the moment. As far as tariffs are concerned, I like to examine each proposal on its merits, and to come to a conclusion after a certain examination as to whether the imposition of such a tariff is wise or otherwise. The Minister, in his opening statement, did not make clear to us whether the imposition of this tariff is for the purpose of providing employment or providing revenue. I rather gathered from what he said that the object is to provide additional employment. He has told us incidentally that it is estimated that the imposition of this tariff will give employment to 1,000 additional hands in these factories. I take it that these hands will consist of adult males and females and juveniles, and that the additional cost on those who use these articles will be approximately £150,000 per annum. In other words, that every additional employee is going to cost the country £150 per annum. Under this proposal 1,000 additional employees, costing the State £150,000, will mean £150 per annum for each additional employee. That is only one criticism that one can offer, and from that criticism I think it is clear that before the House should be asked to express an opinion on a problem of this character, it should have an opportunity of exploring it very much more fully than we have had up to the moment. All economists are agreed that all tariffs tend to raise the cost of living.

Mr. Lemass

No.

Mr. Good

All economists are agreed on that subject, and the feature which to me is a rather serious one is the serious difference between the cost of living in this country and in Great Britain and Northern Ireland. In some figures that were issued by the Department of Industry and Commerce within the last few days we have seen that this difference has reached the high figure of ten points as between the two countries. In other words that the cost of living in this poor State of ours is ten points in excess of what it is in Northern Ireland or in Great Britain.

Mr. Lemass

Is the Deputy certain that the figures are calculated on the same basis?

Mr. McGilligan

I have explained that a couple of times.

Mr. Good

I am giving the figures as published by the Minister's Department. It is well known that the cost of production depends very largely on the cost of living and if our cost of living is going to be so greatly in excess of Northern Ireland or of Great Britain that excess in time is bound to seriously affect the export trade from this country to Northern Ireland and to Great Britain. These are facts that I would like Deputies seriously to consider. They are important matters from the aspect of employment in this country. The danger of increasing the cost of living and the cost of production is that in our efforts to provide additional employment in one industry we may cause a much larger measure of unemployment in another industry by reason of the increased cost of production. As I have said, one is in a difficulty in discussing a problem of this character in the absence of the Report of the Commission that have inquired into it, and I will offer no further criticism on this proposal at this stage except to warn Deputies that this tariff proposal is a two-edged sword and may have its dangers and reactions. I want both of these problems inquired into before any additional tariffs are imposed.

Seán O Guilidhe

Ma's maith is mithid. Is mithid rud dá leithéid seo do dhéanamh. Deputy O'Connell raised a rather important point as to whether this tariff is going to increase the cost to the consumer, which is the principal argument used against tariffs by all parties. It reminded me that some time ago I was informed that a ring existed amongst the wholesale distributors of cloth in Ireland. I have been informed that the wholesale distributors of cloth in this country have an understanding that if any manufacturer attempts to sell cloth to a retailer he will be practically boycotted. In the past that understanding operated very much against the production of cloth in Ireland. To prevent the cost being unduly increased to the consumer, which is the strong point scored against the policy of tariffs, it would be no harm if this thing were investigated. It would be no harm if this were investigated and the formation of such a ring made illegal. In America the trusts have operated very seriously against the interest of the consumer, and the American Government have had to take steps to ensure that the operation of such trusts would not militate against the welfare of the citizens. Deputy Good has spoken of the danger of increasing the cost of living. He has told us that if a thousand extra men are employed they are going to cost the consumer £150 for each man. That is a rather far-fetched argument. Dealing with the cost of living in general, it is not so much the cost of living that counts, it is the ability to meet it. What is the use of having a low cost of living if you have a vast body of unemployed to whom the cost of living means nothing at all? Is it not far better to have a high cost of living if you can afford to keep all our people employed in order to meet it? During the war, when the cost of living was at the highest point and when we had practically no unemployment, nobody bothered about the cost of living. If the cost of living were to come down to half what it is, what use would that be to the unemployed?

Take America, where the cost of living is higher than it is here. The American Government are not exactly bad economists, and they are not sentimentalists. Still the Americans have put tariffs on more than woollens, and their tariff on woollens is far higher than the one proposed here. Reference has been made to the manufacture of shoddy. I am inclined to agree with those who suggest that shoddy should be made here. If our people want it, and if many of our people cannot afford to buy more expensive cloth, we should provide them with the cheaper material. It is quite possible that we can produce a fairly cheap material without going to the limit of shoddy. Many Donegal homespuns can be had very cheaply. Good rough, strong, hard-wearing cloth can be had at a very reasonable price. An industry like the homespun industry in the Gaeltacht might be encouraged. Instead of producing shoddy, if we could encourage our people to produce cheap, rough, strong homespun, and if we could devote some of the revenue derived from the tariff on the imported cloth to helping on that industry, it might improve the position. There is just the possibility, as happened in the case of the tobacco industry, that some of the big shoddy manufacturers in England may come in here with capital and establish a huge factory to produce this shoddy and send it abroad as a sample of Irish-made cloth, thereby, perhaps, damaging our reputation in foreign markets. However, all these matters can be discussed when the Bill comes before us. I would ask the Minister to bear in mind that many people in the country may endeavour to take advantage of the tariff to get rich quickly at the expense of the consumer.

Minister for Agriculture (Mr. Hogan)

I welcome Deputy Lemass's speech. I was very glad to have such a specific repudiation of the official economic policy of his party as we got to-night. I was very glad to hear that he was entirely against this policy of general tariffs. I was also very glad to hear that he was entirely against the policy of a tax on the raw materials of the farmers' production. I will say this: if Deputies face these problems and show they are able to learn, I will do anything I can to help them. It is a long step in advance certainly when Deputy Lemass practically specifically tells us that he had abandoned this policy of a general tariff—that he had abandoned the policy of a tariff on the raw material of agriculture and that he was entirely in favour of our policy of selective protection. I welcome that; it is a sign of sense.

However, there is more shoddy in this debate than has been referred to by the Minister for Finance. There is one point I should like to make. We are told that the preference should go to America, so far as there will be any preference. That is what I call shoddy. There is an Imperial Preference system in England at present. It might be extended at any time. Do Deputies think it would be well that we should get the advantage of that in case of extension? If they do, do they think we are likely to get the advantage of that if we do not reciprocate? The suggestion that a country like this, with an export trade to England of between thirty-five and forty millions, should, when giving preferences, give them to a country like America, with which we have no export trade worth speaking of, and refuse them to a country with which we do far and away our largest export trade, is merely childish.

Mr. Lemass

Is that the reason for the resolution?

Mr. Hogan

That is not the question. I am making quite a relevant observation. What I should like to know is: what is the reason for the suggestion that this should be given to America? I ask Deputies to consider this question not as having an export trade with England, but say with the Balkans or some country like that, leaving England out. If our export trade was with the Balkans or some other country that we apparently would have more affinities with, just consider this: We have an export trade of between thirty and forty million pounds to a certain country. There is a question of giving a certain preference. When it is suggested that this preference should be given, the suggestion comes that the preference should be given to a country with which we have no export trade at all. That is just shoddy and nonsense. As Deputies have learned so much on the question of tariffs up to the present, they will probably go a bit further and, if they consider it, they will see the great advantages from the business point of view, whatever about politics, in giving the preference not to America, but to England.

Mr. Cooney

What is the value of our imports?

Mr. Hogan

That is another question. The Deputy will pardon me if I do not enter into it at present. I must say that Deputy Flinn is coming on a little also. He is all in favour of a good export market. None of the brass wall round this country for Deputy Flinn. I am afraid Deputy de Valera is being let down in his absence in a shocking fashion. I had thought the real policy for this country was to build a wall around it.

Mr. Lemass

We are not responsible for what you thought.

An Leas-Cheann Comhairle

We are getting a long way from the resolution.

Mr. Moore

Perhaps the Minister will take advantage of the opportunity to explain the curious statement he made some months ago, that Irish butter was getting the top price in the English market when it is so far behind?

Mr. McGilligan

That is not relevant.

Mr. Lemass

It is as relevant as the Minister's speech.

Mr. Hogan

I suggest that if the statements I am making are irrelevant it is because the speeches that have been made up to the present are irrelevant, because I am commenting on statements from the other side. I was saying that I was glad to notice that, like Deputy Lemass, Deputy Flinn is coming on. That export trade we are going to build up now is going to be very valuable to us, but as to the existing export trade there is something wrong with it—we can afford to ignore that. Or perhaps Deputies have also changed their minds on that subject, and have come to the conclusion that even the existing export trade is valuable. In any case, in future the export trade is the thing. As I said, Deputy de Valera is being let down in a shocking way in his absence. The official policy was to build a wall all around this country. I think I heard it referred to as "hair-shirt economics." We were to live in the country with nothing going out and nothing coming in.

Mr. Lemass

Who said that?

Mr. Hogan

Deputy de Valera.

Mr. Moore

The Minister for Agriculture said it.

Mr. Lemass

Produce the quotation.

Mr. Hogan

Certainly I will. I assure Deputies that I do not go round with a complete collection of Deputy de Valera's statements in my pocket— far from it.

Mr. Lemass

You come now with a complete collection of misrepresentations.

An Leas-Cheann Comhairle

It has nothing to do with this resolution.

Mr. Cooney

I hope we will leave you outside the wall.

Mr. Hogan

If the Deputy is inside I might decide to go outside.

Mr. Cooney

You would have to.

Mr. Hogan

The export trade is valuable, very valuable I agree. That is another sign that Deputies are learning sense and I congratulate them. I do not agree with Deputy Flinn that this temptation should be taken away from a weak Minister for Finance. I think he is fundamentally wrong on that point. There is, as Deputy Good pointed out, another party to the transaction whose interests have got to be thought about and to be considered, and that is the consumer and the tax payer. Twenty per cent., someone said, is not high enough. No, not from the point of view of the woollen manufacturer. If I were a woollen manufacturer I would like thirty or forty or fifty per cent.—the higher the better, and why not? But there are other interests to be considered. Have you thought of them? There is the consumer and the taxpayer. Any money in the way of taxation resulting from any policy such as this should go to the relief of taxation and to the lowering of taxes.

Mr. Lemass

Where does it go?

Mr. Hogan

And not to development schemes such as Deputy Flinn suggested. In other words, not to any further bounty to other business.

Mr. Lemass

May I ask the Minister a question? Am I to understand that this duty is brought into the Imperial preference regulation as part of the general policy of giving preference to British goods?

Mr. Hogan

That is the trouble about discussing these matters here.

Mr. Lemass

Answer the question.

Mr. Hogan

Deputies opposite seem to be incapable of dealing with any questions except in simple generalisations. They cannot be dealt with effectively by simple generalisations. The position here is that in this particular case it was suggested that a preference of five per cent. should be given to imported English manufactured woollens. It was immediately suggested by Deputies opposite that this five per cent. preference should be given to America, and I say that that general idea is completely unsound. Speaking generally, as this has been raised, my opinion is that if preferences are to be given they should go to the country with which we do the biggest trade— that is my general idea—and not to the country with which we do practically no trade, and I say that any business man will agree with that. It is all very fine to talk in this sense here in the Dáil. But it would be a serious matter for us if there was an extension of the present Imperial preference that exists, if this country were not able to avail of that.

Mr. Lemass

Will the Minister answer my question? Will the Minister tell us exactly why this preference is being given in this case?

Mr. Hogan

I do not know.

Mr. Moore

I would like to ask the Minister if he has estimated whether this is to be a very expensive tariff or not. It would seem as if it would be a very expensive tariff, and in that connection the chief expense seems to be in bringing goods across the Border. So far as I can learn, all dutiable goods coming across the Border are leading to no end of trouble. I think it would be worth while to consider whether the greater part of the dutiable goods that come in should not be compelled to come in through the ports of Saorstát Eireann. I remember when the Dublin Industrial Development Association had an interview with the Minister for Industry and Commerce some years ago one of the arguments he put up against going more quickly with protection was that it took nearly three years to train a revenue officer and that they had not revenue officers enough to perform the work required under general protection. Obviously there is going now to be very much increased duties put on the revenue officer at the Border, and very likely the number will have to be increased. These revenue officers will have to be men capable of valuing cloth which they see coming in across the Border, and the question is could there not be found a more economic way of performing the duties than the present system, by which, at any port and at various points on the Border, dutiable goods can be brought in. I throw out that suggestion. In connection with the tariffs, if we are to get any advantage worth while from them, we should not allow part of the proceeds to be dissipated in that manner. I do not suppose the Minister is yet in a position to deal with that matter, but it may be that there is something in the report of the Tariff Commission on the subject, and if so we would like to have it.

Mr. Blythe

I do not know whether it would be possible to lay the type-script copy or not on the table before the printed copy is ready, but I shall consider it. With reference to the question of Imperial preference and the point which Deputy MacEntee raised with regard to the importance of this matter, while the figures that Deputy MacEntee quoted dealt with countries of consignment rather than with countries of origin, nevertheless, it is true that the majority of the imports of woollens to the Saorstát come from Great Britain and Northern Ireland. Consequently it is true that the effective rate for the great bulk of the goods would be twenty per cent. Now, it was intended by the Tariff Commission that twenty per cent. should be the effective rate for the great bulk of the goods, and the Tariff Commission's recommendation would be, if the Government or the House were not prepared to have Imperial preference at all, simply a flat rate, and that that flat rate should be twenty per cent. Deputy MacEntee, I think, or some other Deputy, said that an application for safeguarding tariffs is at present being heard in Great Britain. That application is for a tariff on cloths of from two to eleven ounces in weight, so that the market in Great Britain would still be open for many of the ranges of cloth made by the Free State manufacturers. It needs to be borne in mind in this connection that there has always been a considerable sale of woollens to Great Britain and Northern Ireland. It is a known fact, of course, that appreciable quantities of the cloth sold by manufacturers here to wholesale houses in England afterwards came back here, but that cannot be anything like the major part of the exports. I shall quote a few figures casually. In 1908 the total production of woollens and worsteds in Saorstát Eireann was 2,500,000 odd yards. I presume they are trade yards. The home sales were 1,600,000 yards. The sales in Great Britain and Northern Ireland were 659,000 yards, and in other countries the sales were 222,000 yards. Now, say in 1913 the figures were similar. There was some increase in the quantity. We had in 1913 1,500,000 yards in the home sales. We had 787,000 yards in Great Britain and Northern Ireland, and 373,000 in other countries. Then, during the war, there was, of course, a very great export to Great Britain, but in 1921 we had a substantial drop, so that you had 780,000 home sales, and 457,000 yards in Great Britain and Northern Ireland. The proportion of sales to Great Britain and Northern Ireland has steadily since 1908 been a very important factor in the trade, much more important than all other countries outside Great Britain taken together. It will be important for the mills to retain that trade as far as possible.

Now the mere imposition of a tariff here with the present state of industry in Great Britain is bound to create marketing difficulties. I will say no more than that. It seems to me that the Tariff Commission were well advised in recommending the Imperial preference. I personally had no idea that the matter of Imperial preference was being discussed until I actually received the Report of the Tariff Commission. I had not in the short time since had an opportunity of discussing the matter very fully. But for the purpose of putting down these Resolutions I accepted the recommendations of the Tariff Commission as they stand; the resolutions are based entirely on them. I am prepared to consider that whole question of Imperial preference further, but, on the face of it, it seems to me in all the circumstances of the position it is a justifiable recommendation, and one which I think we should adhere to.

With regard to the question of shoddy, shoddy is not necessarily such a bad material as some Deputies seem to think. There are qualities of shoddy which are much superior to certain classes of cloth made out of virgin wool, shoddies which are made out of wool reclaimed from samples and tailors' clippings. In many respects shoddy made out of samples and tailors' clippings is superior to cloth made out of virgin wool. With regard to the cheap classes of shoddy, it is not at all certain that they are uneconomic. Some of the woollen manufacturers here who do not make shoddies have contended that they should not be allowed, and they have contended that although they are very cheap, their wearing value is so much less, that on the whole the people suffer economically by buying them. But, as I say, that is not proved, and you have the difficulty of the people who would be extremely hard hit if they were forbidden to purchase these classes of goods, and have to find the price for a much superior article. The position with regard to this is that while there is a certain use of reclaimed wool in the Irish mills, the mills appearing before the Tariff Commission were not prepared to undertake the development of the manufacture of the cheaper lines. If we impose a tariff now on those cheaper lines which could not be made here, it is probable that we would handicap very seriously certain manufacturers of ready-made clothing who are operating in the Saorstát and that we might cause unemployment in another direction. The whole position with regard to shoddy can be reviewed at some later period. It may well be that the general development of the position of the woollen mills here will cause them to undertake—either some one of them or a number of them joined together—the manufacture of types of cloth which they at present do not bother with. That remains to be seen. The question of shoddy is one of the matters which has been dealt with at very considerable length in the Report of the Tariff Commission. When these Resolutions come up before the Dáil again, Deputies will have been able to read the Reports of the Tariff Commission, so that they will be in a somewhat better position to discuss the matter.

The same applies to the question of the reorganisation of the industry and to the question of rationalisation—the policy of confining the product of a particular mill to a much smaller range of goods. As I gather from the Report of the Tariff Commission, the Tariff Commission set out upon the inquiry with the point of view that Deputy O'Connell has. While they are not so very positive, in my view, in this matter, they seem to have come to the conclusion that not a great deal is to be done in the direction of centralisation so far as the woollen industry is concerned. However, again, I do not think I should pursue that until the Deputies have an opportunity of reading the Report.

Worsted spinning is done to some small extent in the Saorstát, but the finer types of yarn are not made here. The worsted industry is a very specialised one. As a matter of fact, to some extent each operation in connection with the production of worsteds counts as a separate trade. There are manufacturers who simply comb the wool and sell the tops. There are others who simply spin and dye and purchase the tops. There are others who dye and spin and some of them only spin a particular type of yarn. So that what the future of the worsted spinning is in the Saorstát is, I think, somewhat obscure. But, as there is a certain amount of worsted spinning done at the moment, it is probable that the assistance to the worsted weaving which will be given by the tariff may result in an increase in spinning. The Tariff Commission were, judging by their Report, in some doubt as to whether they ought to put a tariff on yarns so that spinning could be encouraged at the same time as weaving. They apparently came to the conclusion that at present, at any rate, there should not be any duty put on yarn, but that the duty should be put on the woven material. I think that by a simple interjection, at any rate, there has been a reply to the two points raised by Deputy Good. The amount that is received in revenue is not what the assistance to the industry costs the country. So far as revenue is received there is no cost to the country.

The Ceann Comhairle

took the Chair.

Mr. Blythe

Where the cost to the country in the case of any tariff arises is where there is no revenue but a higher price charged to the consumer for the home-produced article. What I regard as a fallacy, that was given utterance to by a Deputy, is one we very frequently see in the Press with regard to the boot tariff.

Mr. Good

Is the Minister denying that the cost of boots has not been increased by the amount of the tariff?

Mr. Flinn

I do anyway, and I will prove it.

Mr. Blythe

It depends on the class of boots, and at any rate the amount that the increased employment in the boot trade costs the country has no relation to the yield in revenue from the boot tariff. If there were no boots at all made at home, and £300,000 were collected by way of a tariff, then there would be no cost to the country except the amount involved in the collection. If, on the other hand, the home boots were fully 15 per cent. higher, or perhaps, say, 14 per cent. higher than the boots made outside, and if there was no revenue collected, then the cost to the country for keeping the industry going would be that 14 per cent. It would not appear in the revenue figures at all.

Mr. Clery

There might be an increase in the price of good boots.

Mr. Flinn

Might I put this to the Minister for Finance—this is on my conscience. I am, for the moment, on the side of Deputy Good——

Mr. Blythe

I think then I will not give way to the Deputy. If he is going to assist me, I prefer to give way to him, but not otherwise.

Mr. Good

It is an unfortunate side to be on, A Chinn Comhairle.

Deputy Carney

rose.

An Ceann Comhairle

I wonder what side is Deputy Carney on?

Deputy Carney

I am on the opposite side.

An Ceann Comhairle

Let the Minister for Finance proceed.

Mr. Blythe

With regard to the cost of living, it has already been pointed out that the cost-of-living figure here is not calculated on the same basis as in Great Britain. I do not think it would be practicable to do what Deputy Moore suggests. The Border traffic, of course, does involve a considerable amount of expense and the revenue collected at Border stations is relatively small. Yet traffic cannot be prevented. You cannot put up a barbed-wire fence and make all traffic go by the ports. Even though you try to prevent commercial traffic, your staffs will have to be there in order to see it. You cannot do it unless you put up a barbed-wire fence and allow nobody through. Even for the purpose of preserving the integrity of the barbed-wire fence you would have to have some sort of guards. Besides, it would involve hardship and inconvenience to people if we tried to send the traffic around.

Mr. Moore

Will the officers not require special training for the new duties?

Mr. Blythe

No. What they do is: in case of doubt the matter is referred to somebody who has special knowledge. So far as the ordinary imports are concerned the duty would be charged on the invoices in the ordinary way. In cases of suspicion and doubt a special investigation will take place. Also, there would be keener scrutiny where exemption from duty is claimed on the matter of price. So far as weight is concerned, that can be dealt with more simply. There is no special training for those men as compared with the men dealing with the importation of motor cars, or anything like that. The officer dealing with any particular class of goods acquires a certain amount of knowledge which enables him sometimes to be suspicious much more quickly than he would otherwise be. Again, he would be able to accept a statement which, if he were ignorant, he might think out of order. The training such an officer requires is a general training; it is not a special training in order to deal with a special class of goods. The difficulty the Deputy referred to in regard to the number of trained officers is a difficulty which has been overcome. We had great difficulties in the early stages immediately after the tariff boundary was set up. We had to take in a great number of men who had no experience and certain delays and difficulties arose, but that has long ago been overcome.

Mr. Carney

Will the Minister tell us if the Tariff Commission took into consideration in their report—the Minister has the report and we have not that advantage—the fact that the big woollen manufacturers of Yorkshire and Lancashire have recently asked for a tariff on woollens, and how that is going to react on the recommendation of the Commission?

Mr. Blythe

I do not see the relevance of that. If a tariff were granted on the other side it would make it more urgent to have a tariff here; it would cut off some of the trade.

Mr. Carney

Will there be a reciprocal arrangement in view of the Imperial preference?

Mr. Blythe

I hope so.

Mr. Carney

You hope so?

Mr. Flinn

Has not the Minister overstated the case on the question of the revenue and the cost to the country? I think we want to be fair in the matter. It seems to me there are three classes. Assume there is £300,000 collected in the tax. The portion which falls on the country is the cost of collecting that, then there is the wholesale profit——

Mr. Blythe

It does not fall on the country. Some of them get it here.

Mr. Flinn

And there is the cost of financing the tax.

Mr. Blythe

Somebody gets that here.

Mr. Flinn

It seems to me that the suggestion is that all revenue that is got from tariffs goes back to the community net. That is the suggestion. I suggest now that there are within the knowledge of the Minister for Finance four separate costs which he has not taken into account when he makes that statement and to that extent he is overstating and unfairly overstating, and unnecessarily unfairly overstating a good case.

Mr. O'Kelly

So far as we are concerned, this is going through as an agreed measure. I would like it to be understood clearly, however, that in so far as paragraph 4 of these financial resolutions is concerned—that which implies the adoption of Imperial preference—we will not stand for that. We do not accept Imperial preference, and we do not want it to be understood that if we are accepting the resolutions we are accepting Imperial preference.

Question put and agreed to.

The Dáil went out of Committee.

Resolutions reported.

Ordered: That the Report be considered on Wednesday, March 6th.