Dáil Éireann díospóireacht -
Friday, 8 May 1931

Vol. 38 No. 9

Financial Resolution No. 13—General. (Resumed)

The Dáil went into Committee on Finance and resumed the consideration of Financial Resolutions.

Debate resumed on following motion:

That it is expedient to amend the law relating to Customs and Inland Revenue (including Excise) and to make further provision in connection with finance.—(Minister for Finance.)

Mr. MacEntee

Possibly the most remarkable thing about the course which this debate has taken, and possibly arising out of the fact that it has centred largely around the de-rating proposals of the Government, is the fact that the Minister for Finance appears to have completely washed his hands of the Budget. He has not been here in his accustomed place to deal with questions which might arise from time to time, and we have the somewhat unusual spectacle of the President of the Executive Council filling the gap in his stead. On Wednesday last the Leader of the Labour Party congratulated the Minister on the fact that this was the eighth successive Budget which he had presented. I feel that if there is to be a General Election this year we, with greater reason, will be able to congratulate the farmers and the taxpayers of the country generally upon the fact that this will be the Minister's last Budget. There is also, I think, since we must be fair to the Minister, a ground upon which we can congratulate him, and that is upon the possession of a hitherto undisclosed sense of humour. Each year, as he has presented his Budget, we on these benches have waited, with every desire to be politely amused, for the one gleam of humour with which it has been the Minister's custom to lighten an otherwise dreary and disheartening recital. But this year we were agreeably surprised as jest after jest marked the Budget, which will be but a sorry joke for the farmers and taxpayers of the country generally. The only comment I wish to make upon that is that it is a great pity that the Minister did not devote some of the wit with which he attempted to lighten his Budget speech to a really sincere effort to lighten his Budget. If so, the position of the Government, as opposed to the other Parties in the country, would be much stronger than it is to-day.

In addition to the humour with which the Minister tried to season his Budget, he had recourse to a certain amount of fiction as well. We heard him, as in other years, recite the pretty little tale about our dead-weight National Debt. After a little dexterous manipulation of the figures, he succeeded in producing a rather sodden omelette of about £15,274,000, which he presented to us as the dead-weight National Debt. Then he bethought himself that possibly even that omelette would be too much for the Cumann Na nGaedheal digestion— he seldom thinks of their intelligence and of their commonsense when dealing with these financial matters—and he added virtuously: "Of course in making this calculation I left out of account the £5,000,000 which we are to pay Great Britain under the Damage to Property (Compensation) (Amendment) Act, and £500,000 due in respect of the Dáil Eireann External Loan." The Minister, while drawing the attention of the Dáil to the fact that he had not taken these sums into account, said not a word about the sums payable under the Ultimate Financial Settlement, sums which amount roughly to something like five and a half million pounds annually. Are these sums payable? If the Minister were here I should like him to answer the question immediately, but since he is not here, and the President, I understand, proposes to conclude the debate, I should like to ask him to answer this question: Are the sums paid under the Ultimate Financial Settlement paid in liquidation of a debt due or are they not? If they are paid in liquidation of a debt, why does the Minister leave them wholly out of account when reckoning up the State's liabilities?

Capitalised, these annual payments represent no less a burden than £110,000,000. It is more than five times the aggregate total of the sums to which the Minister directed public attention. The economic consequences of the payments are more disastrous even than the heaviest taxation, provided it were spent internally, which the Minister could impose, or the wildest extravagance of this most prodigal Government, for, at least, most of these extravagances would be perpetrated at home; the moneys would be spent here, and the expenditure for the most part would represent a transfer of funds between individuals within the community. In the case of the payments made under the Ultimate Financial Settlement, the moneys go out never to return, and we get nothing in exchange for them—not even a copy of the "Daily Mail."

Yet in his review of the State's financial position the Minister, who pays this money, who is responsible for the agreement under which it is paid, ignores it altogether. Why? I must go back to the question I put a moment ago. Either this money is due on account of a debt or it is not due at all. If it is due on account of a debt, then it should be reckoned amongst our liabilities, and the dead-weight debt of the State will not be a mere paltry £20,000,000, but something in the neighbourhood of £130,000,000. Of course, to make an admission like that, to confess that inside such a comparatively short period as eight years, the Cumann na nGaedheal Government has succeeded in saddling the people of this community with a debt of £130,000,000—the greatest per capita debt of any supposedly self-governing community in the world—would be at once to destroy the fiction and figment which the President and those associated with him have been at such pains to create—the fiction that they have been the financial saviours of this community. If it is not a debt, and I submit the only reason why the Minister is entitled to leave it out of account is the assumption that it is not a debt, then why pay it at all? That is a dilemma out of which the Government cannot escape. Either the money is due as a debt, and as a debt we should pay it, and it should be reckoned as part of the National Debt, or it is not a debt at all, and therefore should not be paid.

The reason why the Minister for Finance each year has been at such pains to ignore and push this question aside is that he knows in his heart of hearts, as every member of the Government knows, that there is no justification in law or in ethics for paying three-and-a-quarter million land annuities and approximately one-and-a-quarter millions of R.I.C. pensions. There is no escape from this dilemma. If it is a debt it should be reckoned as part of the National Debt and paid; if it is not a part of the National Debt it should not be paid at all. And in either case the Government responsible for imposing such a burden upon the people of this community, if it is a debt, or for paying it if it is not a debt, will have to render an account for it to the community, and I hope the community will visit them with the punishment they deserve.

I was going to deal yesterday with the question of abnormal expenditure. One other fiction in which the Minister indulged, and to which he is now becoming addicted, is that he has succeeded in balancing his Budget. This year, as in other years, we see the Minister in a more or less arbitrary manner selecting certain expenditure which he classifies as abnormal, and declares will have to be met by borrowing. As Deputy Ryan pointed out yesterday, it is rather an extraordinary coincidence that year after year these sums amount just to that sum which the Minister has found it necessary to provide by borrowing in order to make this fictitious balance of the Budget of which he has so often spoken. The Minister, however, this year has grown a little uneasy in his mind. He feels that his subterfuge is seen through, and he was at pains to point out the dangers which are inherent in the course which he has pursued. In his old age—the eighth year of his Budget—he tends to become virtuous, and apparently takes that pride in his virtues which besets all of us when our passions are no longer capable——

The President

Is this a public confession?

Mr. MacEntee

Open confession is good for the soul, and if the case is, as Deputy Flinn pointed out yesterday, there being no more——

An Ceann Comhairle

Open confession may be good for the soul, but this is not too suitable a metaphor for a Parliamentary assembly. We had it yesterday at some length.

Mr. MacEntee

I think it is an adaptation of a rather famous maxim. I leave it at that. However, while the Minister for Finance was extremely virtuous about the minor items, which he classified as abnormal expenditure, and said that these things should never be dealt with in that way at all, he proceeded, having classified as abnormal, I think, the whole of the provision for the Local Loans Fund, amounting to something like £570,000, to justify that classification upon the grounds that this was money which clearly should never be found by way of taxation. But what is the purpose of the Local Loans Fund? It is mainly used to finance schemes of national improvements—water supplies, sewerage works, housing schemes, many of which for economic reasons could not be carried out unless the money was available at a particularly cheap rate. To provide the Local Loans Fund out of borrowing and, therefore, relate all advances from it to the current commercial rate of interest, is to defeat the very purposes of the fund and to limit its employment to those schemes which are themselves in relation to contemporary monetary factors financially justifiable.

But among the most desirable works —possibly among those which will be ultimately most beneficial—there will be many which do not fall within this category at all. These are schemes which the Fund was originally set up to finance. They are schemes of great value representing improvements of the national estate. They ought to be paid for year after year out of the earnings of the community, and not out of borrowing. I submit, therefore, that the provision of the moneys for the Local Loans Fund should, in the first instance, be met out of taxation, so that the particularly favourable terms necessary to finance such schemes may be offered by those in charge of the Fund. If money has to be borrowed at five per cent. for a period of twenty or thirty years in order to set up the Fund, naturally those who have the management of the Fund must see that the advances made from it bear some relation as regards the interest charged and the period within which they are to be repaid to the terms upon which the money which originally constituted the Fund was borrowed. But, in order to provide cheap housing in this country it is necessary, as has been pointed out time and again, that long-term loans should be available for local authorities, and that those loans should be granted at particularly low rates of interest. There is little justification for providing those particularly favourable terms both in regard to the period over which the debt must be redeemed and the rate of interest which is to be charged if the money has to be provided, at the expense of the ordinary taxpayers, by borrowing from the more fortunate individuals in the community, instead of taking from them by way of taxation a loan for an indefinite period which would be free of interest. What has happened is that during the past four years we have provided something like £1,600,000 out of borrowing for the Local Loans Fund. At a rough estimate, that is costing in respect of the Local Loans Fund alone something like £110,000 per annum. That sum has to be provided out of the taxation of the community as a whole. If that sum of £1,600,000 had been provided out of taxation before the shilling was taken off the income tax, the poorer members of the community would be better off each year to the extent of this £110,000, because the fact that that sum has to be devoted to the repayment of the capital charges upon the borrowed money means that there is £110,000 less in the National Exchequer to finance social services, to finance particularly those public health services which are costly, and which, because they are costly, are far outside the capacity of most of our local communities to undertake.

I come now to the kernel of the Budget—de-rating. On this question the Minister for Finance and the Government have chosen to play the role of Mr. Facing Both Ways. They tell us that the heart and the affections of the Government are with those who signed the Majority Report, but that nevertheless they accept the minority point of view. The Government's affections are with the Majority Report, but they are prepared to enter into a temporary arrangement, a sort of companionate marriage, with those who stand for the minority point of view. It is not the first time that the morals of the Government have succumbed to profitable temptation. Many aspects of the question were dealt with by Deputies yesterday, but there is one aspect to which I think particular attention should be devoted, and that is the manner in which it is proposed to distribute this grant. I would like to make it quite clear in order to safeguard ourselves against the sort of misrepresentation which the Minister for Agriculture indulged in in a speech last night when he said that when the Government came along with a vote of £750,000 towards de-rating that Fianna Fáil opposed it—I would like to make it quite clear that Fianna Fáil are not opposing the grant of £750,000 for the relief of farmers, but Fianna Fáil are criticising the £750,000 on the ground that it is too little to afford any real relief, particularly any real relief to those who most require it and most deserve it, the small holders and the small farmers of this community. That is the first ground of our criticism of the Government's proposal, not that they are making a grant towards relief, but that they are making a grant which, in all the circumstances of the time, is wholly insufficient to afford any relief to farmers.

Apart altogether from the manner in which this grant is being made, I should like to put before the House some example of the manner in which it is going to be distributed according to the Minister's scheme. Before doing so, I would like to remind the House of what the Minister for Finance said when introducing the Budget. A good deal of consideration, he said, has been given to the question of how the grants now proposed to be given ought to be distributed. "We have decided," he said, "that the new grant shall be divided as to fifty per cent. on the old basis, and as to the remaining fifty per cent. on the basis of the population of counties. Distributed in this way the bigger share of the grant will go to the poorer and more thickly populated areas."

The point I wish to bring out first of all is that, according to the Minister, this method of distributing the grant was taken after due consideration. The second point is that if it is distributed in this way, according to the Minister, a big share of the grant will go to the poorer and more thickly populated areas. I wonder did the Minister or the members of the Executive Council examine for a moment the manner in which this proposed scheme of allocation is going to operate? The first point that arises in connection with it is what is meant by the expression "population of the county." There are four possible applications of the term. It may mean the whole population of the county council areas; it may mean the population of the rural districts only; it may mean only the occupiers of holdings, or it may mean the agricultural population generally in a county. There are four possible applications of the term with four different results arising therefrom. The Minister for Finance was challenged yesterday by Deputy de Valera to say what he meant by "the population of the county." The Minister said he meant by population of the county populations of the counties, and passed on. He brushed the question aside. The Minister for Agriculture was asked the same question last night, and he brushed it aside in exactly the same manner. Why? Because these gentlemen who have come before the Dáil with a scheme which they say has been arrived at after mature consideration and deliberation, are unable to say what they mean themselves by the proposed distribution according to the population of the counties. I am not prepared to state what I cannot prove, but I am certainly very strongly of opinion that this scheme received no consideration at all, that it was a last minute improvisation, presumably a sort of capitulation to farmer members of the Party on the one hand, and to Chamber of Commerce members on the other hand. The part of the Government that was attached to the Majority Report could not find it in its heart to accede to the farmer members of the Cumann na nGaedheal Party, but at the same time they had not the backbone to resist them, not that it would be creditable to them to have backbone in that case. They capitulated, they surrendered to them as far as the Chamber of Commerce members permitted them to do so, and having done that they said: "We will have to say something to show that this, instead of being a last-minute surrender, a more or less unconditional surrender, is the fruit of mature thought and consideration," and they come along and say that they are going to distribute part of the grant according to the population of the county, and when they use that phrase they do not know in their own minds what they mean by it.

Let us consider some examples of the manner in which this grant is going to be distributed under this scheme which has received so much mature consideration. The Minister for Agriculture last night in the course of ten minutes, in which he contrived to crowd more deliberate inaccuracies into a speech than he has succeeded, so far as my recollection goes, in doing in this House in the last four or five years, stated that according to this scheme which they had proposed there was absolute discrimination in favour of the small farmer. Very well. We will take some of the counties and see how the discrimination in favour of the small farmer operates.

According to the Minister's scheme Cavan is going to receive as part of the grant £27,000. In Cavan there are 11,201 occupiers of holdings not exceeding £15 valuation and out of the £27,000 these 11,201 occupiers are going to receive £9,765. That is 17/5 per head is going to be the net receipts of the occupiers of these small holdings. But in Cavan there are 5,019 occupiers of holdings of a valuation exceeding £15 and under the Minister's scheme these 5,019 people are going to receive between them almost twice as much as the whole amount given to the 11,201 small holders. They are going to receive £17,235 or £3 8s. 1d. per head.

In Meath there is going to be allocated £25,250 of which 6,500 occupiers of holdings not exceeding £15 valuation will receive £1,627 or 5/- per holding. As against this, 5,300 occupiers of holdings exceeding £15 are going to receive £24,741 or £4 13s. 4d. per holding. There is certainly discrimination in this case, but it is marked discrimination against the small occupiers and not in favour of them. In Cork there will be distributed £82,450 of which 20,666 occupiers of holdings not exceeding £15 valuation will receive £10,604 amounting to a net receipt per occupier of 10s. 2½d. and on the other hand in Cork, 15,275 occupiers of holdings exceeding £15 valuation will receive £71,846, a net receipt of £4 14s. 1d. per head. In Galway where £56,350 is to be distributed, 22,208 small holdings will receive £19,893 or 17/10 per holding, while 7,314 large holdings will receive £36,457 or £4 19s. 8d. per holding. In Mayo to which £55,000 will be allocated 28,504 small occupiers will receive between them £31,887 or 22/3 per head. But on the other hand, less than one-seventh of that number, 3,450 large occupiers will receive £23,113 or £6 14s. per head.

I am not going to go down the whole list, but I have another county which I will mention. Tirconaill under the Government proposals is going to receive £43,200, which will be distributed as to £18,495 amongst 23,548 small occupiers, giving them 15s. 8d. per holding, while £24,705 will go to 3,348 large occupiers, giving them £7 7s. 7d. per holding. The Minister for Finance stated that distributed in this way a bigger share of the grant will go to poorer and more thickly populated areas. The Minister for Agriculture stated that there was absolute discrimination in favour of the small farmers, that the higher the population the more they would get in relief. The real fact of the matter is that, averaging it one way with another, the small holders get round about the same figures with the exception of two counties, Meath and Mayo. But the larger holders are getting greater relief than the small holders in every case, and the poorer the county is, the more thickly populated it is, as I have shown you, the larger the share of relief the large holder is going to get. For instance, in Meath, where the large holders and the small ones are divided roughly in equal proportions, 6,500 small occupiers as against 5,300 large occupiers, to put it in that rough and ready way, a large holder gets £4 13s. 4d. per holding, but in Mayo, where there are 28,504 small occupiers as against 3,450 large occupiers, the large occupier gets £6 14s. per holding. In Tirconaill, where there are 23,548 small occupiers as against 3,348 large occupiers, the large occupier gets £7 7s. 7d. per holding. The real fact of the matter is that the poverty of the poorer counties like Mayo and Tirconaill is being made the instrument for enriching the Government's friends, the big rancher, the big grazier and the large farmer. That is how this scheme operates. That is, I believe, if there was any conscious design in it beyond a mere haphazard selection of some new principle of distribution, how it was designed to operate. The congests of Mayo are being made the cat's-paws to provide the chestnuts for the nabobs of the counties; the large farmers of Galway, and the squireens of Galway are going to benefit because the poverty of their less fortunate neighbours is being used as an excuse by the Government to endow the grazier, the rancher and the large farmer, the man who holds over 100 acres in this country. It is in line with the Government policy. We protest against it as being inequitable.

Deputy de Valera has adumbrated a proposal which would deal fairly with the small holder, which would give a more or less equitable distribution of the relief. If the first £15 had been completely de-rated, every small holder in the country would receive an average relief of £1 14s. per small holding; and, of course, the relief given to the large holders would be smaller—to the men who can best afford to meet the pinch of present circumstances, to the men who have not had to reduce their standard of living as the people in the poorest districts of Tirconaill, Mayo and Kerry have had to reduce it, not only because of the bad times of depression through which agriculture is going, but because, as Deputy O'Hanlon pointed out yesterday, their sons and daughters in America, upon whom they have to depend for a large measure of their assistance, are unable to assist them this year as in former years. These are the real people who ought to be helped. Those are the farmers who are really depressed, and those are the people who have the first call upon the Exchequer of this State and upon the sympathy of the Deputies of all parties, even of the Cumann na nGaedheal Party.

It was said on Wednesday that this was possibly an election fund Budget. It may have been originally intended to be an election fund Budget, but I have been thinking it over to try and ascertain why it was that the Deputies of the Cumann na nGaedheal Party applauded this Budget after the Minister had made his speech. I think the reason they applauded it was because they realised that after presenting this Budget to the House the Minister dared not face the country with it, and therefore their Parliamentary lives had another year's respite. I cannot conceive any other reason why this Budget was met with applause. I cannot, for instance, understand why Deputy Hugh Law or Deputy Michael Og MacFadden could applaud a Budget which proposes to give the small holder in Tirconaill relief to the extent of 15/8 per head, and to tax his family to the extent of 15/8 at least in order to provide that, and at the same time gives £7 7s. per head to the 3,000 odd large holders in this constituency.

Mr. J.J. Byrne

Are they not taxed at all?

Mr. MacEntee

I cannot understand why Deputy J.J. Byrne applauded this Budget which proposed to tax the workers of Dublin in their sugar and transport, in their journeys to and from their work, a very heavy item in the Dublin workman's budget. I cannot understand why he applauded a Budget which proposes to impose that tax, not in order that a small holder might be helped, but that the rancher in Meath might receive £4 13s. 4d. in relief, and, as I said before, the nabobs in Mayo, £6 14s.; but that is what Deputy Byrne did, and that is what he will have to defend when next he goes on the hustings; this grant of relief not to the small, but to the large farmers in this country, and not in favour of, but against the small farmer, this general imposition of a burden on the whole community in order to relieve one particular small and privileged section of it.

With regard to the general question of taxation, I would like to say that we on this side do not believe that taxation is anything but a poor substitute for economy. One other ground upon which the Minister's proposal can be criticised is that in order to provide this relief which the farmers require, it would have been very easy for the Minister to have provided not only £750,000, but to have virtually doubled the agricultural relief grant, and provided another £1,129,000, without imposing a penny piece additional taxation. There are sums of money payable under the Ultimate Financial Settlement to Great Britain in respect of the pensions of the ex-R.I.C. men. As we have shown time and again in this House, there is no justification or liability under the Treaty for paying these moneys. When he comes to the House and presents his financial statement, the Minister for Finance leaves this payment out of account altogether. He does not regard it as a debt honestly due, because if it were a debt he would be compelled to include it in his computation of the dead weight National Debt. He leaves it out, and he can only leave it out for one reason, because he knows that under the Treaty we are not bound to pay these moneys, and as we are not bound, even those of us who accept the Treaty position, should not pay them. If these moneys were not paid, not only the £750,000 which I have referred to would be provided, but an additional £460,000 would be provided for the relief of the small farmer, or the intermediate farmer, and to some extent, of the large farmer as well. That extra £460,000 would enable us, in addition to de-rating the first £15 of valuation of all the farmers in the country, to de-rate to the extent of 50 per cent. the remaining farmers up to the first £50 of valuation, and would still leave an additional sum for relief, to be allocated to the large farmers who have holdings above that valuation.

In that way, I repeat, without the imposition of an extra penny piece on taxation, there would have been provided a graduated scale of relief, which would take into consideration the necessities of the small farmer, the fact that the medium-sized farmer has his trouble and difficulties, and the fact that the large farmer in some districts, but not in all, provides a certain amount of employment. In that way there could have been a graduated scale of relief which would have been fair to every section of the community which could have been granted without, as I said, imposing an additional penny piece of taxation. These proposals of the Minister have been made without thought, without any real concern for the interests of the general body of the community. We, on the Fianna Fáil Benches, have opposed the grant of £750,000, and criticised that grant on the grounds that it is insufficient, and on the grounds that the proposed method of distributing it is an unconsidered and inequitable one.

Mr. Kilroy

I rise to say a few words in criticism of this Budget, because, as has been clearly pointed out by Deputy MacEntee, there is no question whatever that no relief is brought to the poor farmers in the West of Ireland. A large majority of those farmers, according to Deputy MacEntee's figures, and as I know myself from experience, because of the place in which I live, are of very low rating. Thousands of them are under £4 valuation. Large numbers of those families consist of from six to eight and ten and sometimes twelve in number. In paying the sugar tax which is now imposed on them they will actually have to pay about twice as much as they will receive in relief under this Budget. It was clear at the outset from the Minister's attitude that no relief was intended for poor people such as those small farmers. It was very evident that they were not taken into consideration. In fact, it was quite clear that he wanted to favour the other party, who were already in a better position to pay taxes than those farmers I refer to—the small farmers. Of course, as regards those to whom he has brought assistance and to whom he will look for votes at the General Election, perhaps it was wise to consider them alone, but it is up to me, as a representative of my class, to see that the interests of those I represent are looked after. For that reason I want to make my protest against this method of the Minister in securing that the poorer classes of our community will be made to pay for the wealthier classes in any relief that they may get.

In like manner, those who can afford a holiday get relief from the betting tax under this Budget, while the poor worker in the town or out in the country who might desire to put on a small bet on a horse on the day of races must pay the tax. The poorer man cannot afford a holiday. He must pay the tax while the wealthy man who can afford a holiday is relieved of it. It is quite correct because of these facts to call this Budget the rich man's Budget, because on all sides the evidence clearly shows that the poorer man is not considered at all, while the wealthier man is catered for. In all those items which the Minister has taken into consideration he has seen fit to bring relief in those various directions to the wealthier classes of our community. I want to protest against this method of pretended relief being brought to the western farmer. No such thing has taken place in this Budget. In fact, he is taxed more heavily than he has hitherto been. I only hope that when the western farmer gets an opportunity of casting his vote again that he will be more considerate and see that the Cumann na nGaedheal Deputies who claim votes from him in order to represent him in the Parliament of the Nation will get their just deserts.

Mr. Anthony

I want to offer one or two criticisms of the Budget statement. There are some things in the Budget which to me, at any rate, are very welcome. The fact that the Minister has seen fit to remit the entertainment tax in certain directions and notably in the direction of amateur productions and productions such as we have from time to time in the Abbey Theatre, is one of the welcome features of the Budget. However, in common with nearly every other Deputy representing the cities, I deprecate the tax on sugar. I have all the time, even when considering matters of tariffs, objected to any tax whatever being placed on the food of the people. In Cork City we have unfortunately a very large number of unemployed, a very large number of people who cannot afford to pay this extra tax on sugar. We have, of course, a very large number of people on home assistance. The money expended in that direction, whilst in bulk it may appear large, is not at all sufficient to keep body and soul together for these poor people. This extra burden of ½d. a lb. on sugar is one which these people cannot bear in my view, and in the view of those who take any interest in the poor of our country. It is a step in the wrong direction so far as taxation is concerned.

There is at least one feature of the entertainment tax which has not yet been touched upon. I agree that it is time that a substantial tax was placed on the talkie films, and I welcome that, but at the same time there is the silent film. These silent films, of late, at any rate, are practically passing out of the country, and we do know that the talkie film has not had the effect of making more settled the youth of the country. It has had quite the contrary effect, and, in my view, a most demoralising effect. I have no hesitation in saying that, no matter how many people in this country I am antagonising, and I do not pose, as I said before, as a very pious individual. The silent film is enjoyed by many children and numbers of grown-ups, and, in my view, the tax on the silent film, if not removed altogether, should be considerably reduced.

The tax on betting has been mentioned. I welcome that step so far as it relates to the remission of that tax on point-to-point meetings and racecourses, but perhaps it would be better if the Minister went a little farther and put a very prohibitive tax on the stay-at-home backer. I have no sympathy whatever with the citizen, whether he be a working man or an aristocrat with plenty of money, who wants to back horses. I feel that there are too many facilities provided for the working man to back horses. Under our Betting Act we have legalised saloons and betting places in the City of Dublin and the City of Cork, and in my view no greater harm has been done to the people of this country than that done by the legalisation of betting.

Mr. Shaw

The Deputy voted for it in the division.

Mr. Anthony

I was about to proceed to say, if Deputy Shaw permitted me, that I served on the Betting Committee, and was in the position of choosing between two evils. We only learn by experience, and, incidentally, I may say that I have as great, if not a greater, interest in sport than Deputy Shaw. I may not keep a racehorse, but I have taken part in nearly every form of sport that is practised in this country, and I still continue that practice. As I have said, I served on the Betting Committee, and had to choose the lesser of two evils—whether it was well to perpetuate the farce of allowing betting to continue and of making periodical raids on the betting offices, of inflicting a fine which was subsequently remitted, of continuing that farce which brought the law into ridicule and contempt, or whether we should legalise those offices and derive some revenue from them. I find now that I made a mistake, and that I should have opposed strenuously and bitterly the legalisation of betting in this country.

I know, of course, that I lay myself open to a good deal of misrepresentation on this matter. It is rather unfortunate that people in public life in this country cannot give utterance to the spirit that is in them without laying themselves open to the most vile charges, to a lot of vilification and abuse. That is one of the things which prevents many decent citizens from coming into the arena of politics. Because of their finer feelings, possibly because of their upbringing, and possibly because of their over sensitiveness, they are afraid of getting into the maelstrom of politics in this country. I welcome the remission of the tax on betting in so far as it relates to racecourses, because I believe that were it not for racing we would have one of our chief industries and one of the chief attractions in this country, namely, hunting, seriously injured. I am glad to see that the Minister for Finance has remitted that tax, and I hope that as a result of that remission we will have increased prosperity for horse-breeding and increased attractions to the hunting fraternity who visit our shores from year to year.

Again, I must utter a protest against the imposition of a tax on the food of the people. It is regrettable that the Minister did not find some other way of raising revenue than by placing a tax on sugar. There are other ways in which he might have found the necessary finance to carry on the country than by taxing that commodity. Some Deputies may not know what it means to feel, as some of these working class families do feel and have felt, the pinch of hunger. I know many families in the purlieus, lanes and alleys in Cork who will find the imposition of this tax a very severe strain on their resources. It may be said that I am merely playing to the gallery, a thing which I do not like to do, but I am aware of the circumstances of many of these poor people, and that is why I am so vehement in my protest against the sugar tax. I hope that if it is going to continue, it will not be continued beyond this time twelve months, because I believe that before that the Government will have to face up to a general election, owing to the fact that there is discontent up and down the country, due to the incidence of this kind of taxation. I know many small struggling farmers in my area who will find that the imposition of this tax is just another example of the method, of which this Government has made a practice, of taxation by transferring money from one pocket to another. It has been pointed out here by various speakers that the amount that will accure to the Exchequer by this tax on sugar will have to be met, and more than met, by the small farmer. That applies in equal measure, as I have said, to the workers in our cities and towns, and for that reason I am opposed to this motion.

Mr. Derrig

The only thing, so far as I can see, upon which we can congratulate the Minister for Finance in regard to his Budget is the effort he has made to enable orchestras and artistes to continue to live in this country. I agree with a great deal of what Deputy Anthony has said in regard to talking films. The question of the general demoralisation and overspending going on in the City of Dublin and causing such discontent among the farming community is not a matter that we can go into very deeply here. But when the Minister for Finance goes out of his way to refer to certain tendencies that are being manifested in expenditure on entertainment and so on, when we have the daily Press reporting that a certain well-known racing function was more successful this year than it has been for many years, and also when the Minister for Finance says that, according to the examination carried out by his Department, there is no reason whatever for the remission of a particular duty, it is certainly extraordinary that he should come along, in spite of these factors, and remit that particular duty. We see letters in the Press from Dublin traders stating that a large number of people attending those functions and professing to give a lead in social affairs, are very slow in squaring up their accounts afterwards. I think that the Minister for Finance, if he went into that question at all, should have gone a little more thoroughly into it.

My own opinion, which I expressed before, is that the hire purchase system is bound to lead to trouble. It has committed a large number of people in receipt of regular incomes to charges and obligations which they now find themselves unable to maintain. If some steps had been made to curtail expenditure and to cut down these extravagant advantages that firms profess to give people by giving them materials for nothing, even without a cash deposit in the beginning, I think it would have been an effort at any rate to curtail this extravagance.

The Budget shows also that we have certain items appearing as Exchequer assets which in fact are not assets. Other speakers have referred to the question of the creameries. The State expended something like £700,000 on these creameries, and at the time that the money was being voted we questioned whether it was good national policy, or even good business, to pay such a large sum. The outlook at that time for the dairying industry may have been better than it is now, and the Minister for Agriculture may have been justified in taking the step he did to get control of this important industry, but if we are to continue to write off the assets which we are supposed to have in this industry at the rate at which we are writing them off this year, £168,000, then, in three or four years we will find that the £700,000 which he advanced may be completely written off.

If the dairying industry improves to such a condition that these assets will appreciate above their present value nobody will be more delighted than I, but anybody who is acquainted with the circumstances and who has given any study to the circumstances prevailing across the water must believe that the present depression in agriculture is going to continue. I think, therefore, that the Minister for Agriculture, so far as his Department is referred to in the Budget statement, has very little upon which to congratulate himself. He has staked the greater part of whatever little reputation he has left on his efforts in this matter of the dairying industry and the financial effects have been disastrous. I do not know that any business man would be tolerated for five minutes in any business concern who could not conduct a business transaction of such magnitude on a better basis than the Minister has conducted this.

There is also the question of the sugar beet subsidy. The Government contend that they have made a ten years' contract with the proprietors of the beet factory and that they cannot break that contract. What was the object of the sugar beet subsidy? Was it to enable a number of financiers, when the money was not forthcoming in this country, from Belgium and Czecho-Slovakia, having invested £380,000, to reap the advantage of a subsidy of ten millions, which will enable them to clear out at the end of the period, having got their factory as well as their sugar beet free for the entire period? It has been suggested that these gentlemen may be philanthropic enough to remain on after the end of ten years. I cannot see any hope that they will unless the subsidy is continued. If we look at the figures or the accounts of the undertaking, we must conclude that they are working on the basis of a ten years' period, and they want to be able to clear out after the ten years if they see no possibility of making substantial profits after the subsidy has terminated.

The Minister for Agriculture stated that the object of the subsidy was to increase tillage. Recently he stated in Athy that the Government were not to blame in this matter of grain growing and the future of the nine or ten counties that are very substantially interested in the matter. He stated that we have given them an alternative, the beet subsidy, but the point is that although they gave a definite contract and a definite promise to the factory for that ten year period, the grower had no security after the first three years. You are now in the position that you have a number of small farmers who, because their productive capacity was low, and because the factory did not consider that they were the best people to deal with, were excluded in the earlier years and the bigger growers who built up the success of the undertaking and made a name for themselves, because I believe they have been as successful as growers in any other country and even more successful, are now in danger that they are going to be entirely excluded. The factory may be able to drive a hard bargain with the small farmer who considers that he has a grievance because up to the present he has made very little out of the undertaking. He is in very penurious circumstances at present and he is willing to seize any straw whatever that will enable him to get hard cash. The price offered is 38/- this year and it may be 34/- next year if the present circumstances continue. The factory can take advantage of the condition of the small farmer and can force prices down in competition with the prices of barley and oats. It will simply mean that the sugar beet subsidy instead of being an encouragement to the agricultural community, particularly to the farmers who employ labour, is simply going to be used as a method of extorting slave labour and of extracting more from the small farmer than the State is entitled to allow. I think the Government had a good case for interference in this matter. They had public opinion behind them. Even now I contend they still have a remedy. As well as a ten years' subsidy we are granting an indirect subsidy in the form of remission of duty on sugar manufactured in this country.

Although it is proposed to increase the Customs duty this year, the preference to the Sugar Manufacturing Co. is still going to continue. Does the Government contend that in addition to the payment of a direct cash subsidy which the country is paying, in the new circumstances where the factory is stepping over the heads of the growers, breaking up their association and trying to drive the hardest terms they can with the small farmers in order to get an acreage—does the Government think in these circumstances—it is justified in giving a preference in the form of an indirect subsidy? If, on the other hand, the Government has a policy for developing the beet industry in this country after the ten-year period, and if it has any plans for maintaining it or extending it, I think the sooner the Government takes the country into its confidence the better. The position at present is that there is wholesale discontent and great resentment naturally between the growers who have been working up to the present and who refused to grow this year and the small growers who are coming in. I think the Government should have some policy to deal with this matter.

Another matter which is very disappointing in the Budget is the failure of the Minister for Finance to effect any economies. He has admitted, in the way that he seeks to collect the tax to provide for this temporary relief for farmers, that he is working on the principle that those who get relief shall in the long run pay for it. He is working on the principle that the Minister for Agriculture has so often criticised, that you are going to take money out of the farmer's pocket with one hand and put it into it with the other. This is exactly the same thing. It could be argued that even within the limits of taxation, the Minister for Finance had other opportunities for getting the yield than by direct taxation. In the case of petrol, for example, although it may be argued that there is a case, apart from de-rating altogether, for transferring the onus of maintaining the main and trunk roads to the petrol tax and motor traffic generally, the Minister for Finance, in an endeavour to make the case that the petrol tax will not in the long run come back to the farmer, states that he is relying on the fact that the retailer will not pass it on.

What is the position of the retailer? The position of the retailer is that the retail price is fixed by the combine, that price is to be charged, or else the retailer is forced out of business, and can be forced out of business tomorrow by the action of those foreign combines. Even the Government of this State is not able to prevent that, so far as I know. If you take the case of those people who have small garages and try to get into an independent business, or those shops who carry on side lines and whose total revenue is not great, is it to be contended that in such cases those people should not pass on this 4d. tax to the consumer? It seems to me that it must be passed on. You cannot go to the very end of the scale and ask the people who have a very small turnover and a small business to reduce their profits not already very much. You have such cases of persons in this industry, if it can be called an industry—at any rate a distribution service—where there is wholesale depression, and where there are too many people trying to operate where you have cutting of prices, and a number of failures. In such cases it must be passed on.

If the Minister for Finance said that taxation should be imposed upon motor merchants who sell big cars, or the man who sells tyres or other accessories, there would be an outcry from that part of the population. But here is a case where, under the pretext of maintaining the yield of tax, the Minister is putting on a tax that is going to be transferred, and it is a tax that is going to lean heavily, perhaps not so heavily as the sugar tax, but, nevertheless, is going to lean not alone on the poor people who are in the distributing business, but it also will lean on those who are driving or hiring cars. In the long run, it may be the taxi-driver who will have to pay far more in comparison with his earnings in the way of petrol tax than those people whom we see every day driving their cars into Grafton Street because they are too lazy to walk from their residential quarters, and they leave these cars here in the streets of Dublin.

The fundamental point as far as agriculture is concerned is that agricultural prices, as has often been reiterated in this House, have gone back practically to pre-war level and the cost of living is coming down. How is the agriculturalist to live in the intervening period? In a great many cases he is in debt already; certainly he is not making a profit and if he is borrowing money from the Agricultural Credit Corporation his last case may be worse than the first. How is he going to live in the intervening period? If the philosophy of the Government Party is right and if they stand by what was said in the De-rating Commission Report that there is danger that in the matter of protective tariffs we are feeding ourselves with our own tail and that subsidies or bounties or relief to agriculturalists in any form must tax the non-agricultural community, such a policy is therefore to be decried.

If that is their policy how can they explain why agriculture is being forced by the rest of the community to maintain a standard of living and to maintain services that it is not able to maintain? You have that in the congested districts areas which were referred to by Deputy Walsh last night where as far back as 1901 there was a Government Commission report stating that in those areas it was the case of the poor maintaining the destitute—a state of affairs that is still existing there and you have that state of affairs all along the West coast of Ireland. On the other hand you have counties where you have substantial farms but a large number of these farms are derelict. The farmers there are in debt and there is no future whatever for the farming industry, particularly in the tillage areas. This is not a new phenomenon. It is going on for a hundred years. The De-rating Commission coolly set aside the whole question of agricultural depression, and on the other hand they tell us that world conditions are very serious and must be looked into. The Minister for Finance said that world conditions are going to rule the whole question for him and asked what is he to do.

World conditions have been pressing on agriculture for a considerable time. World conditions are now against the Irish farmers, and world conditions, so far as we can reasonably see, are going to be against them in the future. The farmer has a very sound instinct which the Executive Council have counted upon in this relief, and that is the instinct that this feeding him with his own tail is no good and that it is not going to lead to anything. There is danger that the whole case of the farmer may be prejudiced if the country is going to be committed to the position that the only way in which you can discuss relief for the farmer is on the basis that there must be a tax on the rest of the community, and in the long run that tax is to be passed back to the farmer who bears two-thirds of the primary producing capacity of the State.

The farmers want a reduction in their overhead expenses; the farmers want a reduction not only in their central taxation but in their local taxation. I am greatly against the suggestion of the Minister for Finance of appointing managers to go down to the country. Where the farmers' representatives have bitterly fought against any increase in the local rates in the past, the managerial system itself is not going to effect any change in the matter of local taxation. No matter how efficient managers may be so long as the system remains as at present, so long as the town standards are set for country agriculturalists, so long as the rural communities are forced to maintain certain services that they cannot maintain, the managerial system is not going to get you out of the difficulty. If local rural communities were allowed their way in this matter they would, unfortunately, do away with a large number of these services. The taking over of these services by the State may mean, as the De-rating Commission points out, great extravagance and a large increase in these services. The only hope is to do what you are asking the local bodies to do, and what you are constantly criticising them for not doing. Why not turn round and do the same thing yourself? Yes, the Minister for Finance, the national manager, the national housekeeper, has not effected one single economy that he can point to or that he can show the agricultural community.

I have not forgotten that over and above all there is this problem of bringing him up to the general standard or reducing the general standard to the level that our agricultural industry can afford. If there had been strong action taken on this matter of public expenditure, I feel that something might be done to bring down prices and effect a readjustment. But the trouble at present is that the whole readjustment is being effected slowly and painfully at the cost of the agricultural section of the community. The agricultural section of the community have been driven out of business while that course is manifesting itself. We have been charged by the Minister for Agriculture that there is some change in our policy. There is no change in our policy. Our policy was well shown in the amendments that we proposed to the Land Bill which, we made it quite clear, were put forward in order that encouragement should be given to the small farmers.

That is not the Fianna Fáil policy. It is the policy of every Party in this House. It is the State policy. You have a huge Department of State, costing hundreds of thousands of pounds, and its chief business is the carrying out of that policy, making economic holdings and wiping out the enormous grass ranches, putting in their stead hundreds of families. That is the policy that the President of the Executive Council asked the country to compliment him upon when he spoke recently at the Cumann na nGaedheal Convention. At the same time as they pretend to carry out this policy, they are going to relieve these people. These people have already been relieved through the Land Act. They are going to receive extra compensation for disturbance. The land is going to be taken from them in pursuance of a policy that says it is better for the country to have ten families living on a certain area of land than to have only one man with his herd and his dog. When they are carrying out that policy they will now have to pay extra compensation to those people, and I contend that the compensation will be so much that they will not really be able to take the land; at any rate, if they do acquire the land it can be only taken on terms absolutely uneconomic from the point of view of the people whom it is intended to place upon it.

The President tells us that he has a policy for the Gaeltacht. It has been well said by members of his own Party that these people ought to be paid in order to live in the Gaeltacht. The Government are prepared to give an advantage which to my mind, seems to run directly counter to the State policy of splitting up the ranches. They are prepared to give extra compensation for the lands that will be acquired. Are we now to proceed further, and give these people heavy relief in the matter of local taxation, while at the same time we are not giving corresponding relief to the poorer people in the community? As I have indicated, there are in this country areas where the poor are maintaining the destitute. There are places where the valuations are £1 or £2, and yet people are expected to live there and bring up families. Are we not going to give these people adequate benefit? To my mind, you are giving these people not the same benefit, but far less benefit. You are going to take away from them far more than you are giving to them. On the other hand, you are giving every advantage to the other classes, whom you are obviously encouraging.

It is apparently the State policy to try to bring these people into the country who did not think it was safe or good to live here after the Treaty was signed. The general taxpayer is being mulcted to the extent of a remission in income tax of 1/6 in the £. That has been remitted in order to encourage those people to come in here. Is it suggested, if those people come back here, if they are worthy people and have connections with the country, and if they will be of advantage to the areas where they reside, that as well as remitting income tax and giving special privileges to them, together with all the other amenities the Government are giving them, they will be also given relief from rates? Are we going, in the case of the man with a valuation of £1,000, to give him this extraordinary relief in rates over the whole of his valuation?

Our policy, as it was set out in the Land Bill, is to give preference to the small man, and we do not think the man who has nothing else but a grass ranch and who gives no employment is worthy of consideration. There should be, in the case of the congested areas, a limit below which you must either abolish rates altogether or give better services. The Government could, for instance, give a much better medical service than at the present time. The people are being given only small relief in the matter of public health. Public health services could be improved in various areas. I realise that to abolish rates altogether in these areas will create difficulties which at the present time cannot easily be solved. On the other hand, you have areas where you have substantial farms, where the farmers have been endeavouring to carry on and to give employment, but they found it impossible to do so. We maintain that these farmers deserve relief in so far as they contribute to production and give employment. Many such farmers maintain four or five labouring families on their farms, and, in such cases, they are entitled to relief.

Our first duty is to the small man, who is at present living simply under slave conditions. The small man has been taken advantage of, and he will have to remain in his present position until we set our house in order and tackle this question by reducing expenditure at the top. If there was some indication that the Government were going to go into this whole question of agricultural rating and examine the question thoroughly, they might have met with more sympathy. It would appear that at the last moment they decided to throw £750,000 at the farmers as a sop to keep them quiet. The basis of allocation does not seem to indicate that the difficulties in the congested areas and in tillage counties like Wexford, where there is great depression, and where there are 9,000 agricultural labourers deserving of consideration, have been gone into. Those matters ought to have been considered from the very beginning.

The Government should, at least, institute a system of local taxation that would tend to assist the agriculturist. When we take the whole circumstances of the agricultural industry into consideration, I think we will agree that there is a strong case for a de-rating system. The whole tendency is to increase indirect taxation. The farmer has to pay his share of that. He is paying at least 43 per cent., according to the De-rating Commission's Report, of the Customs duties, the protective duties that have been imposed. He is paying more than 43 per cent. in the case of some items. When you are offering £750,000 you are not, as was semi-officially admitted in the Dublin Press, giving back to the farmers all you have taken from them under the protective system. We recognise the difficulty in regard to protection, and we are prepared to support a plan of de-rating on a basis which will give remission where remission is most required. On the other hand, we will safeguard the State against giving undue remissions in income tax and in the matter of an agricultural grant to people who really do not want them.

Mr. Nolan

I do not think there is a Finance Minister in Europe who could produce a Budget in the same optimistic spirit as our Minister for Finance has produced this year's Budget. I do not know if there is a business firm in Europe to-day that could speak in the same tones as our Minister for Finance has spoken. That is a condition of things deserving of congratulation, not alone from Deputies on this and other sides of the House, but from people of all creeds and classes throughout the country. The Minister has brought in his eighth Budget. Notwithstanding the wave of depression all over the world, the Minister has succeeded in balancing his Budget better even than in previous years. Deputy Lemass referred to that yesterday. He was surprised that Deputies on this side of the House were not throwing off their coats and waving their hands. I suppose Deputy Lemass did not even expect that the Budget would be so good, and therefore he was surprised that we were not waving our hands and even adjourning the Dáil because of it. The farmers may be somewhat disappointed at getting only about one-third by way of relief of rates. Personally, I say it is a good deal for which to be grateful to the Minister. In view of the administration of affairs locally, the local taxation, and the irregularity of the valuations on land, it is too much to expect the Minister to be able to give de-rating after a few weeks' consideration of the report. That report is a very voluminous one, and contains a mass of figures which are well worth studying. In view of that fact, I do not think the Minister could do it. We take it, at all events, as an instalment.

The valuation system is very old. In some areas the valuation is based on what grain was worth many years ago. The system of farming has now changed and therefore the valuations ought to be reconsidered. County Dublin, for instance, is very highly valued. The land is worth it in a sense, because it is near the city. But, across a road or a stream in County Dublin you will find in Counties Kildare, Meath and Wicklow that the valuation of the land is very much lower. A good deal of land in Limerick is very highly valued while, in the adjoining county of Kerry, the valuation is very low. Because of that, it is not fair to have the cost of the social services falling on the highly-valued land as compared with the land that is valued very low. In Limerick the valuation is according to the cow-carrying capacity of the farm. A ten-cow farm in Limerick may have a valuation of £30, while in an adjoining parish it may have only a valuation of £5 or £6. There is no doubt but that the valuation basis there is wrong. As I say, the whole of the charges for local services must be seen to in the future. The Minister I am sure in giving this relief in rates is only just giving it as an instalment with a view to seeing how it can be done and how the administration can be carried out economically.

Deputy O'Reilly said that the petrol tax would fall on the farmer and he mentioned the transport of lambs to market by motor. That is certainly a great advantage to the farmer as compared with transport by rail. Some little percentage of the tax may in that way fall on the farmer, but if we calculate the sum which it will take to send lambs some 75 miles to the Dublin market by motor the tax would work out at about a halfpenny per lamb. When the advantage of motor transport as against rail transport is taken into consideration, I do not think that that is going to hit the producer very hard. In any case, the transport system will have to be changed. If you want to give a great concession to the farmer that will not hit him in any other direction it can be done by a reconsideration of the railway transport system. The cost of transport to-day by rail is as high as when agricultural produce was at its peak price and any concession in the way of rail transport would come to their assistance.

Deputies Lemass and MacEntee spoke about the land annuities. Deputy MacEntee condemned the Minister for Finance for not returning the land annuities or the land bonds as a liability on the State. He says that if they were returned as a liability on the State the annuities should not be paid. If the Minister for Finance was to return the land annuities as a liability of the State he should also return the lands on which these annuities are paid as an asset of the State. He should also return the redemption price of the holdings purchased as an asset. In that way, if the Minister erred at all he erred by not assessing the total value. If he had taken both there is no doubt that there would be £100,000,000 redemption stock to the credit of the State. Deputy MacEntee also said that we could finance de-rating by keeping the annuities at home. That is a subject I have never discussed here.

An Leas-Cheann Comhairle

I hope the Deputy will not do it now.

Mr. Nolan

I am not going into it, but this is a matter that has been taken up recently by the Nationalists of the country, if you like. As one who was present at a meeting of the Sinn Fein Party in 1921, when the then Minister for Agriculture, Mr. Art O'Connor, outlined his Land Bill, I can say that it was practically on the same lines as the Bill which the present Minister for Agriculture brought in subsequently. The plan was not to give cash but bonds, and that was enthusiastically received. That is what the present Minister for Agriculture has done. If the Sinn Fein Party were in favour of giving land bonds, what would be the good of giving bonds if they were not going to recognise them and pay the annuities?

An Leas-Cheann Comhairle

The Deputy had better get back to the Budget.

Mr. Nolan

I am only following the other Deputies. They referred to this matter, and there is no reason why I should not. As to a distinction being made in the distribution of this grant for the relief of rates, Deputy Derrig mentioned the farm with £1,000 valuation. I am with Deputy Derrig in that. All the Parties in the House are in sympathy with the policy of breaking up the ranches. If we take a farm with a valuation of £1,000, the agricultural grant has already gone to relieve the owner of that farm to the extent of about 4/- in the pound. That is a definite subsidy to the £1,000 valuation man. We are increasing the value of that holding by the giving of the agricultural grant, and it will be further increased by this new relief of rates. If we acquire that man's land to divide it up we shall have to give him something near the market value of the holding, so that we are making it harder on the men who will get it when it is divided up, or else the State will have to give a subsidy for the purchase of that farm. As it is our policy to divide up holdings like that, we should not increase the value of these holdings in that way, and thus make the charge heavier on the allottees who will get the land. I would, therefore, recommend that there ought to be some distinction made in regard to the valuation.

I would not confine myself to a £15 or a £25 valuation. I would give relief to the man with £100 valuation These £100 valuation farms are economically worked. If a man has a farm of £200 valuation, it may also be economically worked, and if he gets relief on a valuation of £100 of that £200 farm, his charges will be made so much the lighter, and if he still has a grievance, he can get rid of it by disposing of half of his £200 valuation. If he does, I hope he will dispose of it more economically than a certain Department of State engaged in the dividing up of land. I do not want to criticise that Department, but from their manner of working one would almost think that they maliciously intended to destroy some estates. We can talk about that on another occasion, so I will pass from it. But if we want to divide the land, we ought not to give subsidies to the bigger farmers now, which would only make it all the harder and more costly later on to divide that land, and which would put much heavier charges on the incoming tenants. I would recommend a valuation something definite, such as £100, or even £50. It is no use fixing a valuation of £15. You will find that the occupier of a farm of that valuation has not much a better life than the agricultural worker who is in constant employment. He is very often employed by the man with a farm of £100 valuation in the harvesting time for occasional work.

There is another reason why relief ought to be given to farmers. Everyone believes that the farmer is very hardly hit at the present time. The youth are running away from the land into the urban areas. The attraction is there. They have shorter hours of work in the towns and cities. On the farms the hours are much longer, and are often from daylight to dark. Besides the youth on the farms are not paid for the work they do. In the cities and the towns even the child of fourteen or fifteen years of age, if it does work, is paid for it in pocket money. The farmer's son gets nothing, and the labourer's son gets nothing for what they do. Some attraction should be found to induce the youth to remain in the rural districts. I make no apology for putting a certain charge upon the urban areas, because if they want luxuries they ought to pay for them. Three great advantages could be conferred on the farmer—(1) to derate from a certain valuation down; (2) better credit facilities, and (3) lower transport charges.

The farmer pays no income tax directly, but if income tax is increased on those who do pay, it will, undoubtedly, come back on the farmer just as the sugar tax will come back upon them. I never yet heard any farmer suggest an increase in the income tax, nor any labourer, because, as I have stated, any such increase will fall back eventually on them. We have no industries in this country to pay income tax except, perhaps, two in Dublin. If you take these out of the country you have nothing only commercialism, and any income tax they pay will be handed on to the people, whether in the price of clothes, boots, or on groceries. I am surprised that Deputy O'Connell should encourage an increase of income tax. He generally does so, but no intelligent worker or labourer in the country would encourage it. I often discussed the matter with the workers in the County Limerick, and found that they are not for increasing the income tax. I have nothing further to say except to again congratulate the Minister for Finance on the very optimistic manner in which he spoke about the Budget.

Mr. Fahy

It is not my intention to delay the House very long in the discussion of this Budget or the scheme for farm relief. I wish briefly to refer to a few of the arguments put forward on the other side. The Minister for Agriculture undoubtedly, we will be told in the newspapers, hit out last night as he always does. He has been hitting out so often that he should enter now, I think, for the light-weight championship of the world. But in his argumentative bouts he might at least have adhered to the truth and have some mental honesty. It might be fair enough for a certain type of politician at the cross-roads to indulge in half truths, but it is hardly befitting a Minister.

Deputy de Valera put up three different arguments here upon this matter of getting money for the relief of the farmers, and the Minister for Agriculture deliberately omitted two of them and fastened on the third. We were told by the Minister for Finance and the Minister for Agriculture when we brought forward what was called the million pounds motion before the Dáil that it was hasty, ill-digested, and that we were ill-informed, and could not possibly deal with it without the expert information at the disposal of the Government. They stated that even the Ministry could not deal with it, that they had not sufficient information as to the condition of the country and as to the effect of distribution by one method or another. And they said that they would wait for the report of the experts, and that they had all the experts on the Commission dealing with de-rating.

Now the Commission on De-rating has reported and, as Deputy Nolan said, their report is a valuable one and well worthy of study. They brought in, in fact, three reports, but the Minister for Agriculture, with a wave of his hand, very jocularly said: "We have thrown away all their reports and have acted in direct opposition to the three of them." They were waiting for a permanent solution until they got the distilled wisdom of this report, and having got three different reports, they throw the three overboard, and gave, he said, £750,000 for de-rating. I wonder whether the farmers would have got that were it not for the promises made to them at the Dublin bye-election and the million pound motion so ill-digested and ill-informed that Fianna Fáil brought in. We were also told that our motion would be but a temporary measure, and that the Government, in their great wisdom, would bring in a permanent measure. Does the Minister for Finance assert that this is a permanent measure, and that year after year it will not require further consideration? We are not promised that this grant will be given for many years. It will be given, no doubt, for two or three years, because the Minister said we cannot expect that a revival in industry and a general economic revival in the world will be felt by the farming community for a few years. We must presume it is intended to give this grant, whether in an increased or diminished amount, for a few years to come, but there is nothing like that great permanent solution we were promised when the Government would put their scheme before the House. As a matter of fact, the Minister for Agriculture said they had just upset the whole report and brought this in off their own bat, contrary to the reports of their experts. That did not look like mature consideration. We are to supply that money by a tax of 1/2d. a pound on sugar. Taking it that a labourer's family in the country or town or a small farmer's family will consume half a stone of sugar per week, this means an additional sixteen shillings a year for the upkeep of that family. I wonder what more compensation in the matter of rate relief the small farmer in Galway or Mayo will get out of this £750,000, or how much better off he will be? Then there was the specious argument of the Minister for Agriculture, who compared this tax with tariffs for the protection of Irish industry. Of course the Minister's argument is obviously fallacious. This is a net increase of burden. The Minister also forgot to state the fact that it is possible, and more than likely, that the boot tariff, for instance, is largely paid by the boot manufacturer in Britain. Naturally he wants to hold the Irish market, and will pay some tariff in order to do that, but the sugar tax is a net increase of burden.

In speaking of the petrol tax the Minister for Finance used a puerile argument. He said there was no reason why the whole burden should be passed on. Why does not the Minister, or the Cabinet, apply that to other commodities? Why restrict the profit of the petrol dealer any more than the profit of anybody else? In this particular case it is more difficult because, as in tobacco so in petrol, the big combines fix the prices, I understand, at which the retailer must sell. The retailer cannot sell below the price fixed. I am quite with the Minister if he wants to restrict profiteering. His suggestion is to begin with petrol in which restriction is so difficult owing to the absolute control exercised by the big combines. When he asks this class to forego their profits why not ask others also? Apart from that the Secretary of the Great Southern Railways Company has given the game away as one can see from the newspapers. Discussing railway and bus traffic, he stated that the public will pay the petrol tax. Everybody knows that they will.

Then there is the matter of balancing the Budget to which Deputy Nolan referred. There are various ways of balancing the Budget. One is by starving certain services. Last year I asked that half a million more be given to the Electricity Supply Board. Some Deputies on this side have been criticised for their opposition to the Shannon scheme. Some members on these benches did think that the scheme was premature. However, from five to eight million pounds of State money have been sunk in that scheme and everybody inside of this House and outside of it wishes that the scheme will be a success. Looking through the Estimates, we find that for the year 1930-31 the Shannon Electricity Supply, under certain Acts, is to receive £1,270,912, and for the year 1931-32 the sum in the Estimates is £300,000. Rumours have been heard in Dublin and other places that this service is being starved. That is a very short-sighted policy in view of the fact, as I have said, that from five to eight million pounds of State money have been sunk in the scheme. The Electricity Supply Board has got the supply, but it is being prevented or restricted in its operations for want of money to enable it to get customers. The Board is being starved for want of money to enable it to link up the small towns and thereby get customers. I say it would be a pity to spoil the scheme in which such a huge sum of money has been invested by cheese-paring in the matter of the supply of funds to permit the Board to get customers. That is one point that I think the Minister for Finance should consider with the Minister for Industry and Commerce.

Mr. Kennedy

Deputy Nolan congratulated the Minister for Finance on the optimistic tone which runs through the Budget. He said there was no other Minister in Europe who could display such an optimistic tone. We can quite appreciate that. There is no other Minister in Europe who could evade facts to such an extent as the Minister for Finance in this State. What has the Minister for Finance here to show in the first month of the financial year? A deficit of £1,000,000, and a decrease in revenue for the month of April of practically one million pounds, as well as an expenditure of double the revenue. This is the Minister who comes in and displays the note of optimism that Deputy Nolan speaks of. What surprises me about this Budget is that the Minister for Finance, by his extraordinary jugglings, did not give us one of those balancings of the Budget which we have seen ever since this Government came into office, that he did not segregate with the so-called abnormal expenditure this £750,000 which he says is to be given as relief to the farmers.

Nothing would do the Minister but to get this £750,000 from the poorest class in the community. He did not go to the coffers of the bankers in this country who have come out of the economic impassé which they themselves created with trebled financial strength, much of which came about as a result of the sanction given by the present Ministry. The Minister did not go to their coffers and tax the note issue which rightly and properly belongs to this State, and which they are using to their own advantage. Instead, he went down to the uneconomic holders in Connemara, amongst whom the President is delighted to be photographed at certain periods of the year, and taxed one of their necessaries of life, while allowing the plutocrats who attend Punchestown to go free as regards the tax on their bets.

Is cuma na muc

Duine gan seift,

An té ná fuil láidir

Ní foláir a bheith glic.

Mr. Shaw

What is that?

Mr. Kennedy

The most striking fact about this Budget is that the housewives of the State are being taxed by this additional charge of 1/2d. a lb. on sugar, while the punter and gambler are let off free. Surely a working man's Budget! Surely a democratic Budget! As Deputy Flinn pointed out, we heard no reason put up by the Minister why the betting tax should be remitted. Reading the various excuses put up from time to time by deputations that waited on the Ministry to urge its remission, we could see nothing sincere in the excuses put forward. Everybody knows that the decline in racing is not due to the fact that there was a tax on course betting. The betting tax was a war measure. Racing thrived during the war because economic conditions were better, and as the economic position became worse since then, racing, like everything else, has gone down. If a man has the means to go racing the fact that 3d., 6d. or 1s. is stopped out of his bet will not deter him from backing what he considers "a good thing." I never knew anybody that it stopped. Perhaps in one's selfish outlook, when getting paid, backers felt a pang because a certain sum was stopped, and because they did not get the full six to one or ten to one. But that would not deter them from betting and gambling. It is beyond my comprehension to say that betting on the race course has anything to do with horse racing.

Mr. Shaw

I would like to remind the Deputy that Deputy Ruttledge, a member of his Party, was chairman and Deputy MacEntee was a prominent member of the Committee that recommended the remission of this tax, so that there is apparently a difference of opinion in the Party on that question.

Mr. Kennedy

I want to assure the Deputy that I am not the keeper of the consciences of Deputy MacEntee or Deputy Ruttledge.

General Mulcahy

Or their purses.

Mr. Kennedy

It is quite evident from this Budget that it is being used as a lever to do away with local government. The whole tendency of the Government is to distrust local representation, and to have no confidence in the various representatives elected to local councils. The Ministry did not always think that way about local representation. When the struggle for freedom was on here in 1919, 1920 and 1921, the National movement was very glad to avail of the big part taken by county councils, district councils and urban councils. The President of the Executive Council should be aware of that. The County councils and the district councils made it impossible at that time for the British Department of Local Government and Public Health to function here. They withdrew their allegiance from that Department, and they carried on local government under the auspices of the Department of Local Government for the Republican Dáil, and well and effectively did they paralyse the British Local Government in this country. It is hard to understand now how these bodies have become so discredited in the eyes of the Ministry.

In connection with the grant, the contention has been put up from the opposite side that because of less rate-striking powers in the councils, it is necessary, in the interests of economy, to have central control. I would like to put it to the Ministry that they should indicate what economy can be effected, and how it can be effected, if the services in public health which have been forced upon these bodies by the Ministry are retained. Where can the economies come in? Is it at the expense of the ordinary road worker, or at the expense of the roads by curtailing expenditure on them? Is it at the expense of the poor by curtailing home assistance? If not, we would like to hear from the Ministry wherein it is necessary to have a managerial system for the purpose of carrying out economies and what these economies are. Bad government is better than no government. Experience of local government has shown that no more conscientious or more self-sacrificing body of men have ever served the country than the local representatives on the county councils and urban councils. I say that they have set a standard for this House, and if it is the policy of the Ministry to do away with them they should follow that up by doing away with this House, and let civil servants rule the State, assisted by the bankers.

We heard a good deal of talk about the proposed tax on films. I think that tax is not half high enough. The "Talkies" have created more unemployment in a short period in the cities and towns than anything else. As regards Pathé and Movietone displays, the Ministry should exclude their exhibitions altogether from the State, because they are just a means of Imperialistic propaganda. I was forgetting, however, that that is the very thing that suits the Ministry.

Mr. Shaw

The Easter Week procession is shown this week in Dublin houses.

Mr. Kennedy

We heard a good deal of discussion about the contribution for the upkeep of the roads. As I read the financial statement made this year the contribution is to be somewhat less than last year. It is quite evident that all taxation derived from the use of mechanically propelled vehicles— that is the thirty-three and one-third per cent. tax on motors, motor parts and motor tyres—should go in contributions to the councils from the Road Fund. We should certainly bring our contribution up to the level of the contribution in the Six Counties. Taking our roads here all over they are not a patch on the roads in the Six Counties.

Major Myles

That is not so.

Mr. Kennedy

Speaking of the Six Counties, I do not hold any brief for them, and I do not believe in Partition, but we find that there, where they have complete de-rating, they have full local government powers such as we had previous to the 1925 Act. I do not see why this measure of relief should be used to curtail further the powers of local councils. In his Budget statement the Minister for Finance dealt with the National Debt which, according to him, is between thirty and forty millions. The Minister was juggling again. Let it be legal or illegal, how does the Minister account for sending five and a half million pounds out of the country in the form of land annuities and in the form of local loans?

Call that what you may, is it not a capital sum of £110,000,000? Is it not a drain on the country? Why does the Minister not take it into account when he is arriving at the National Debt in the Twenty-Six Counties, apart from the merits altogether of the question of the land annuities. That money represents a capital charge of £110,000,000 on this State, and it should be taken into account in the national accountancy at the beginning of the financial year. But, as I said, the Minister is the best optimist in Europe because he is the best juggler in Europe, and just as he segregates his Budget in the same way he apparently segregates this. As I said, this is being used as an opportunity for doing away with local representation. We challenge the Ministry to go to the country on this issue, to put all their cards on the table, and we are certainly not afraid of the verdict.

The President

May I ask if it is intended to continue the debate over to to-day.

Mr. O'Kelly

I understand there are several members on these benches who wish to speak.

Mr. Maguire

Speaking on the Budget introduced here on Wednesday, I regret to say, from the point of view of the ordinary citizen, that the Budget contains no prospects of improvement to the general well-being of the community. Some relief had been definitely promised to the farmers. The sum mentioned in the Budget might be regarded as a sum that would be at least of some assistance to those engaged in agriculture, but by no stretch of imagination could even the most optimistic claim that the amount would be of itself sufficient even to go near solving the difficulties of the problem. Even if this three-quarters of a million were to serve a useful purpose in giving moderate assistance to those engaged in that industry it would from the nature of things in this State have to be found from a source other than increased taxation. I assert that the proposal contained in the Budget giving this three-quarters of a million relief to agriculture was not introduced by the Government because they were convinced that the solution of the difficulty in which that industry finds itself was to be found through de-rating but the issue was forced upon them through the necessity of doing some thing to relieve an industry that was hard pressed.

For the last two years pressure has been brought to bear on the question of de-rating. De-rating had been brought into effect for the farmers in England and in the North of Ireland. The farmers in this country are dependent on the same market for the sale of their produce as the farmers of England and the North of Ireland and to that extent they should be brought on a level with their competitors. That was an argument that would appeal to reasonable people in this country. The difference between the relative powers of tax raising in England as compared with the Free State is very wide. England is an industrial country and agriculture is a minor industry. In this country agriculture is a major one. The difficulty of finding in this country an alternative to the tax on agriculture is a difficult if not an impossible one. The Government did not believe for one moment that de-rating to the extent of three-quarters of a million pounds which was to be raised by direct taxation of the community was going to solve to an appreciable degree the difficult position in which agriculture finds itself. They did it because they were forced up against the situation but they must do something to relieve the immediate distress. If this three-quarters of a million could be found by a reduction of expenditure in the Free State then a benefit would accrue to agriculture and the community generally to that extent. If three-quarters of a million could be found from some source other than increased taxation it would have similar effects but realising the limitations of our revenue and the fact that no matter upon what assets we pay that tax that in the course of a short time it will ultimately come out of the farmers' pockets the present attempt is merely an attempt to deceive the people into a belief that they are going to receive something when they are going to receive nothing; nobody knows that better than the Minister for Finance who is responsible for that deception.

If the Minister were to abolish indirect taxation and substitute for it a direct tax he would be taking an honest attitude and one that would enlighten the community generally upon the whole system of taxation, but it is a much more convenient arrangement for a Government Minister to throw the responsibility for grievances that are felt by the community upon others. His system prevents the people from pointing at once to things that are making them poorer. If, for instance, the State was to adopt a system that would provide that when a farmer sold a cow at a fair for, say, £20, he would receive a docket from the purchaser setting out the actual value of the cow and at the same time showing various items regarding the cost of Government services that will have to be deducted from the £20, whereby he would get instead of £20 £12, the farmer would then be able to realise his position and to concentrate upon wasteful Government expenditure. In the case of local administration farmers are able to effect economies when taxation is pressing too heavily upon them. The indirect form of taxation through which relief is to be given to the agricultural community, and which involves an addition of a halfpenny a pound on sugar, will not be attributed entirely to the Government. The ordinary consumer will charge the shopkeepers with responsibility for the charge, and it is with that knowledge in their minds that the Government are playacting to the extent they are. They are endeavouring to deceive the farmers into believing that they are giving them relief, while in reality, in the case of a very large section of the community, they are actually adding to their burden. Take a county like Mayo or Leitrim, where the average valuation is £7, the average rate for the last three years was 7/- in the pound, making the average payment 49/-. The contribution towards de-rating outlined in the Budget in such a case will amount to 16/4. Take the average family in Leitrim as six and the average consumption of sugar as a pound a person, the addition of a halfpenny a pound on sugar will amount to 12/6 yearly. The average ratepayer in County Leitrim will benefit accordingly to the extent of the difference between 12/6 that he is going to pay in addition for his sugar and the 16/4 that he is going to receive as benefit under this system of de-rating. Those, of course, whose holdings are less than the average and whose families are equal to those I have referred to will pay proportionately more.

In counties with higher valuations, the large farmers and ranchers will receive larger benefits under the scheme outlined by the Minister. These people will put money into their pockets at the expense of the small holders in Leitrim and elsewhere. There is no justification that I can see under heaven for such a proposal; it is an outrage against simple honesty. I think it is such that those who represent the people that I am representing should speak out openly, and have some re-arrangement of the scheme before it is too late, and not allow the infliction of further hardships upon those who can least afford to bear them.

If there were any proposals in the Budget that offered any solid form of relief to any section of the community that I represent, I would say that there was some justification for it, but is it contended for a moment that this £750,000 will improve production? Is there any test laid down that those who will receive benefit will reinvest the money for the purpose of further production? Not one single test is submitted. Men who hold property in this country and who live and spend their money abroad in at least two cases that I know will receive an annuity of £100 at the expense of the people I refer to, and they will spend this money outside the country. Is that sound economics? Is that really an effort on the part of the Government to help to put that industry on a sounder and safer basis? I find it difficult to understand the attitude of the Government towards this question. I listened last night to a statement made by the Minister for Agriculture, in which he referred to other proposals of a similar nature involving a grant of one million pounds, and which was asked for by this party a short time ago to be made available immediately for the relief of agriculture. The Minister described it as a crude scheme of de-rating, inasmuch as no discrimination was made as to how the money was to be distributed amongst the various land-holders in the country. That description of the situation is quite unjustifiable. It was stated by Deputy de Valera, when introducing that proposal, that it was intended merely as an emergency proposal, and not as a solution of the problem, that the needs of the industry were such as to demand that some immediate attention should be given to it and immediate relief made available. For that reason only did he advocate his proposal, and he certainly never indicated that that was either his own or his party's solution of the de-rating problem. The important thing is that while he accepted it as an expedient he did not by any means suggest that the money should be raised by way of taxes on commodities necessary for poor people. That must be the big dividing line, the big difference, between the present proposal and that submitted by Deputy de Valera which, as I said, was merely an emergency proposal. The public will understand that difference despite the statements of the Minister for Agriculture and others, who may find it convenient to make cheap points on the comparisons between them.

Even from Cumann na nGaedheal benches I have not heard a single individual say that he is satisfied with the Government proposals. The most I heard was from Deputy Nolan this morning, when he expressed the belief that the proposals were part of a larger scheme which the Government would be good enough to introduce at a later stage. At the same time he complimented the Government on what they had done. He tried to flatter himself and to frame his mind up to a point at which he could say: "I am satisfied with the prospect of what may occur next year or the year after, and I can, therefore, support the Government to-day." In his own mind, however, he knew that as a farmers' representative he dare not go back to his constituents and conscientiously say: "Here are the whole proposals which the Government have put forward to assist you, and upon them I am prepared to vindicate my action and take my stand." He dare not do it. He had to go into futurities and console himself with the prospect that the Government would do more at a later stage. He has, however, no answer to give to the farming community whose demands are pressing, demands which, after all, are no more than those of people who want to be allowed to live in their own country, and that is not too much for our farming community to ask.

This agitation for de-rating has been going on for the last two years, and there has been great delay on the part of the Government in bringing forward any measure of relief for the farmer. In his Budget statement two years ago the Minister for Finance gave sound and logical reasons why he should not bring about de-rating. His reasons mainly were that under present conditions de-rating would involve an increase in the price of the necessary commodities of life for those living in the Free State. What has taken place since to make what was wrong two years ago right to-day? Amongst the commodities which he outlined would have to bear an increased tax was sugar. If it was wrong two years ago to impose a tax on sugar, why is it right to do it to-day? What is the explanation of the change of front in regard to his opinion expressed two years ago? The Minister has not attempted to give one word of explanation about it. His reasons for not applying de-rating two years ago were sound to the extent that it might involve an increased tax upon the necessaries of life. The Minister, however, has yielded to the demand that has come from a class of people who have been driven to the verge of bankruptcy. He has yielded to the pressure of people who have been brought to the verge of bankruptcy owing to the Government policy of extravagance and waste.

The Minister in order to save time called into being a Commission to deal with de-rating. That Commission sat for over a year. The majority report of that Commission is practically in accordance with the views expressed by the Minister for Finance two years ago. While this Commission was sitting we have been held back and told to await its decisions as they would be very important. Notwithstanding the fact that the report of the majority of the Commission was in accordance with the views of the Minister, as expressed two years ago, it was turned down. Instead of that report another solution which was spoken of by the simplest farmer in the most remote end of the Free State three years ago has been accepted by the Minister but not accepted and applied in a way which the most simple-minded farmer in the country would have adopted. The method adopted by the Minister to find the money for de-rating is so crude as to be absolutely brutal in its application. As I say, the work done by a number of eminent people on this Commission during the last eighteen months has been turned down and the Minister has given a simple solution upon which some members of his Party have prided themselves as being unique and independent of both the majority and minority reports. We do not know the cost to the country of that Commission because the Minister for Finance refused to answer a question on that point when put to him yesterday. The decision of the Minister is going to inflict hardship on those who can least afford to bear it. That, in brief, is the outcome of all the agitation about de-rating and the assistance that was promised so lavishly in some quarters to the farming community. They were told that if they only awaited the outcome of the efforts of the Commission which was investigating all their ills it would bring about a better situation for them.

That Commission, amongst its various findings, discovered that the farmer was not unduly taxed or that he was not inefficiently served in the matter of public services. They discovered also that the farming community were not paying in proportion to their numbers, that they were not contributing revenue to the extent that they were not equal purchasers of whiskey, equal consumers of stout, equal smokers of cigarettes and users of other articles. The revenue that that would mean to the Minister for Finance is an important factor. To that extent they are not overtaxed. That is the one outstanding fact which the Commission on de-rating discovered. The farmers are not overtaxed; neither are they under-served. The farmer in County Leitrim with an average valuation of £7, is not overtaxed if he is compelled by the Minister for Local Government to pay for the maintenance of a road service that is so grand that it is a menace for him to use it in his ordinary occupation. He is forced to maintain for transport services, roads over which he can scarcely risk his donkey and cart, his horse and cart, or his horse and trap, if he were going to church, market or fair. As a matter of fact, if that statement were challenged, it would be found that the ordinary farmer when going a journey with his horse and cart, will go a long way around over bye-roads rather than take the risk of travelling over the steam-rolled roads which he is being compelled to maintain and to maintain at such a standard that it is not possible for him to use them in his ordinary occupation. That man is not overtaxed!

The farmer is not overtaxed though he is compelled to provide services which it is not in his power to use. That man is not overtaxed in the opinion of those who formed the Commission which went into the question of the rateable capacity of the farmers and the question of finding relief for them. The average farmer in Leitrim with his £7 valuation is not overtaxed if he is compelled, under coercion, to appoint medical officers of health, if he is compelled to pay the highest standard rate of salaries for professional men employed throughout the local services, if he is compelled to pay a standard rate of salary to these professional men, which, I agree, according to their status and their standing they are entitled to receive, but which is entirely beyond the capacity of a farmer with a £7 valuation in Leitrim to afford, even in the greatest future prosperity which the wildest stretch of the imagination can conjure. That man, in the opinion of the De-rating Commission is not overtaxed but, in the mind of any honest-thinking person, beyond question he is overtaxed, taxed beyond his capacity to pay or taxed beyond what, in the judgment of any honest man, he should be required to bear.

If we take it that land is the only asset which we can tax to maintain these services, and if we find that in the County Leitrim, where the average valuation is £7, and that that congested county has, in proportion to its valuation, maintained a number of people much greater than other counties in the State have to do, clearly, it will be agreed an equitable adjustment would be, to have that tax made general. If land is going to be made to bear the tax then let the area of the land and the quality of the land in proportion to the number of people on it be taken into consideration. If an attempt were made in the distribution of this £750,000 towards that end, I would say that the Government had shown some care for those who suffered under severe depression in the past, and who, under the present arrangement, will be more severely affected. So far from that, the Government have gone to the other extreme and have added an increased burden to that to be borne by the people who were most severely crushed in the past. Perhaps it would have been too much to expect from the Government that at this stage they would have shown any appreciation of the human element, and that they would have shown some care and some forethought for those who are least able to defend themselves.

Even at this stage, when the Government found that they had handed over the key of their locker long ago to the interests in this community who control the resources out of which they might find a reasonable means of providing for the relief of agricultural depression, that they dare not demand back the keys, that they could make no real attempt at solving the problem in a practical way, if they had been honest enough at this stage to say: "We have now reached the end of our tether, and we find that the farming interest, which is the mainstay of the country, has been brought to the verge of bankruptcy and is going to collapse, we cannot find any means by which relief can be given, we therefore relinquish the attempt, our hands have been tied and we are powerless to meet the problem as it now confronts us"—had they done that, it might be left to somebody who, with a benign outlook, might have at a later date said that, after all, there was something good in the Government because when they were finally up against it they admitted their mistake and they made way for those who would be in a position to find a way out for those who really matter in this country. Even at this stage, they have insisted on refusing to meet the situation. They endeavoured by camouflage to tell the community that they are bringing in a de-rating scheme and giving £750,000 for the relief of that community, which they know is an additional tax upon a big section of those engaged in the agricultural industry, and they are attempting to leave these matters worse than they were before.

In view of that, the Budget statement is a colossal disappointment to those who had hoped and desired that in the end they would find some solution, because the problem is such that those engaged in agriculture must now recognise that under present conditions there is no loophole for them, that the present Government hold forth no way out, and that some alternative means must be found. That means must be found, and found by getting rid of those who are incompetent, and even if they willed it at the moment, are incapable of finding a solution for the problem.

Mr. George Wolfe

Really one would have thought in listening to the speeches with which we have been favoured for the last two days that £750,000 was a mere bagatelle, in fact that millions of pounds grew on gooseberry bushes, and had only to be plucked and gathered to be distributed. Everybody who has got any sense at all knows that the financial position of all countries is in a very bad way just now, but, compared with a great many other countries, we are in a fairly decent economic position. Nevertheless, it is absolutely necessary that the utmost economy should be practised. It is well known to everybody that the farmers throughout the Saorstát are in a bad condition, and that they have been so for a long time. I speak as a farmer myself. I do a fair amount of mixed farming. I am quite well aware of the position of farmers at the moment. It is quite right that a body of men who bring in a large sum of money to the State should be assisted in their hour of necessity. The Government naturally took the best advice on the subject of the means by which this desirable goal should be attained.

A Commission was appointed to go into the matter of de-rating. That Commission made three reports. It is quite evident that in the face of so many different opinions, the Government would naturally not take one of these reports and act on it, but would be guided by the general trend of the best that was in them. They considered the three reports and this is what they have done. They considered also the means they had at hand of finding the money as quickly as possible. What is the Government's plan for getting the sum of money necessary for this relief to the farmers? They propose a tax of 4d. on petrol and one halfpenny per lb. on sugar. As regards petrol I must say it is the one thing that should be taxed. Speaking as one who has a motor or two and employs a certain number of people in connection with that matter I think that the industry could bear much more than a 4d. tax, a considerable amount more in my opinion. I think if I had my will I would make the tax 6d. per gallon. It could bear that tax quite well.

Mr. Flinn

Why not 1s.?

Mr. Anthony

Fair play now, please.

Mr. G. Wolfe

Has the motor industry as far as roads are concerned been such a great benefit to the country? Has it given the best kind of employment throughout the country? It seems to me to be the reverse. How many people keep chauffeurs? How many people employed on the railways have been driven out of employment by the growth of the motor industry? The railway industry is one of the most important industries in the country and employs thousands of people. Do the owners of motor transport employ as many people? What damage does this heavy motor transport do to the roads for which they are paying practically nothing? I have very little sympathy with the motor people who are unwilling to pay their share of the damage that is done to the roads. They have done a great deal of injury to a great national industry and the railways are a great national asset to the country. The Minister is quite aware of that fact. He has expressed sympathy with the railways. I think that the day when the railways go down will be a very bad day for this country and the loss thus inflicted on the country would not be made up by any prosperity that may come through the motor trade.

As regards the sugar tax, I would just say this much—that if an additional 2d. per gallon were put on petrol there would be practically no sugar tax required at all. I would now suggest that the sugar tax should be fixed at one farthing per lb. and the petrol tax at 5d. per gallon. The additional farthing per lb. on sugar would be practically nothing.

Mr. Davin

It would mean a halfpenny per lb. to the consumer.

Mr. G. Wolfe

I do not think so.

Mr. Flinn

It would mean 6s. 6d. in each family.

Mr. G. Wolfe

Speaking as——

Mr. Flinn

A member of Cumann na nGaedheal.

Mr. Wolfe

—one who lives in a racing district, I am glad that the Government have seen their way to take off the tax on racecourse betting. I think it will have the effect of eventually bringing more money into the country. It will certainly give a fillip to the horse breeding trade throughout the country and to all the industries that are run in connection with horse breeding in this country.

In regard to the talkies, the additional tax that is being put on them is one with which I am in thorough agreement and in thorough sympathy. I think myself that talkies have been far from an advantage to the country. I think that the character of the films has gone down very considerably since the time when the talkies were first introduced. I have been to a great many picture houses throughout the country, and if one compares what is exhibited to-day with the pictures some years ago, I think it will be found that the educational value of to-day's pictures is far less than the educational value of the pictures of a few years ago. I do not believe that the talkies are doing much service to the country. I think the tone and character of the films have gone down considerably in recent times. I am not at all sorry to see that an additional tax has been put on them. I think they can quite well bear that tax, and I do not think it will do any harm at all; on the contrary, it will do a great deal of good.

With regard to the putting into operation of this relief that is being given to the farmers, I just want to say a few words. I understand there is to be a change in the matter of local government, the idea being that the change will work for economy. I thoroughly believe it will. I have been connected more or less with local government since the year 1890. I remember what local government was before the county councils came into being. I know how undemocratic the old system was. That was indeed a very great fault. But as regards economy, I must say that they certainly worked very economically. They must be given credit for that. When the county councils came into office they did their work excellently, but having been partly relieved of the rates and being relieved for a little time from pressing demands, what happened was this: that nearly everybody on the councils had a little fad. I had one myself. One person wanted to have a hospital built in one place and another councillor wanted a tuberculosis hospital or sanatorium placed up on the mountains, and you had all that kind of thing. The result was that in a few years no benefit was felt by the ratepayers from the agricultural grant that was given in 1899. In fact there was more money spent than there had been in the standard year 1897. Soon the amount of money taken from the ratepayers grew to be considerably more than in 1897, notwithstanding the agricultural grant, and the local rates went on increasing. Human nature being very much the same at all times, I think it is a very good thing and quite right that the Central Government should have power to exercise more strict supervision over spending by those local bodies. I have every confidence that this £750,000 will be appreciated very much by the farmers, and that this relief will produce a very good effect throughout the country. I believe it will help those who are now struggling to make both ends meet in the very difficult times that we are passing through.

The President

The first question that arises is that we have been told——

An Ceann Comhairle

Is the President to conclude?

The President

I understood I was.

An Ceann Comhairle

Deputy Briscoe desires to speak.

Mr. Flinn

We would be delighted to hear the President if he is not to conclude the debate.

The President

We have had three and a half hours to-day and five hours yesterday on this debate. Surely it ought to conclude now.

An Ceann Comhairle

Will the President give way to Deputy Briscoe?

The President

I will speak, but it need not be taken that that concludes the debate.

An Ceann Comhairle

Very well.

The President

The first point that one is faced with is that Deputy de Valera said that this tax on sugar would amount to between fifteen shillings and thirty shillings on the small farmer's family, and the agricultural labourer's family, per annum. According to Deputy Murphy the tax will mean 17/6 to the small farmer per annum and according to various other lesser lights, but perhaps the more voluble members of the Fianna Fáil Party, it is fifteen shillings. Taking for a moment that the figures given in the De-rating Report—indicating that 262,000 families are engaged in agriculture—and taking 126,000 for labourers engaged in agriculture, we may assume that there are 350,000 heads of families. Now in connection with that matter I will take in the first place Deputy de Valera's figure of fifteen shillings per family. In 350,000 families that would work out at £262,500 or 83 per cent. of the £315,000 which we expect to get out of this tax. At one pound per family it would be over £350,000 and at 30/- it would be £525,000. If we take the average as between fifteen shillings and thirty shillings per family it would be about £390,000 a figure far in excess of the estimated yield from the tax. That would be without assuming at all any tax from the increased sugar revenue in urban districts, cities and so on. That shows that you have there palpable exaggeration.

You have another kind of exaggeration in a matter mentioned by Deputy Maguire; not exactly perhaps an exaggeration but rather a charge. He says that he knows two people in his county who are going to benefit to the extent of £100 a year by reason of this grant of £750,000. A short time ago Deputy de Valera brought in a motion which proposed to give relief to the extent of £1,000,000. The two people about whom Deputy Maguire speaks would walk off with £130 each or perhaps more in that case. That sort of thing is good enough with which to belabour the Government Party. The Deputy is simply posturing before the people of Leitrim as if he were their sole protector leaving entirely out of account that under the motion brought in by Deputy de Valera, his own leader, these two people of whom he speaks would get £30 a year more.

Mr. Flinn

It is time to give them help.

An Ceann Comhairle

The President is entitled to a fair hearing.

The President

I thought the Deputy would have some sense of decency.

Mr. Flinn

The President will teach it to me.

The President

I have had to do that before.

An Ceann Comhairle

Deputy Flinn must cease interrupting.

Dr. Hennessy

He should learn how to conduct himself.

The President

Deputy Maguire wants to know why this tax was selected. The Minister mentioned that the price of sugar this year was 6s. 4d. Two years ago it was 12s. 4d. The imposition of this tax will leave the sugar cheaper than it was two years ago. That, however, is a matter that Deputies are anxious to forget or else to ignore. Deputy de Valera, who professes such an extraordinary interest now on behalf of the small farmers, went into the lobbies here a short time ago against a motion by the Labour Party that was discriminating between the small farmer and the big farmer. Even to a mathematician like Deputy de Valera I would like to point out that as between the two motions there is a difference not of £250,000 but of £750,000. One was a Fianna Fáil promise and this is a cheque—hard cash. There is a lot of difference between the two.

Mr. Flinn

Whose cash?

The President

The cash of the people—the cash that is in this country and not in English banks.

Mr. Flinn

The President has an account in an English bank.

An Ceann Comhairle

Deputy Flinn has already transgressed against the rules of order, but in the light of this debate and its progress he is transgressing against the rules of common decency.

The President

I have no money, sir, in an English bank and I never had. One suggestion for finding the money for the relief of rates has been mentioned—the retention of the land annuities. I do not know whether Deputies opposite ever read the Gospels. But there is one Gospel which refers to a steward who had neglected his duty and on rendering account, and supplicating consideration, he was forgiven. Immediately on coming out he throttled a person who owed him money. That is the position of the Party opposite. They seek to be forgiven the land annuities and they are going to throttle the land annuitants for money which, if not owed by this country, would not be owed by them. That is the pabulum of the political hot gospellers on the other side.

Mr. de Valera

Nonsense!

The President

They don't like that. They propose to collect the money which the people, according to themselves, do not owe——

Mr. Lemass

We never said that.

The President

—in respect of a service for which they claim there is no money owed.

Mr. de Valera

Not at all.

The President

The next suggestion is economy, and in the elegant language of Deputy Derrig they are tackling this problem at the root by commencing at the top. There is an extraordinary difference in the various views expressed by members of the Fianna Fáil Party. Deputy Flinn, when speaking, went over practically everything. It is to be observed in connection with that Deputy that with all the study which he gives to any of these problems all he is able to do is to describe them. He is never able to suggest a solution. Deputy O'Reilly complained of the incidence of the tax on petrol on the smaller farmer in respect of the carriage of lambs. That matter has been dealt with by Deputy Nolan. It would not amount to much more than a halfpenny a lamb, and I do not think that would affect the price very considerably. Deputy Corry wants full de-rating. Other members of that Party realise that if there was to be full de-rating somebody has to pay for it—the money has to come from somewhere. As it has to come from somewhere a great number of them do not like de-rating. It is when there is easy money, money which nobody in this country would have to pay, they would like to have de-rating. I might say that there is an extraordinary indication of the slave mind and of the imitator on the part of the Fianna Fáil Party. We have had reference to the British income tax. We are to be absolutely tied to that. Every activity of the British Government, legislation and all the rest, is always featured here as something that should be copied. If we have 3s. income tax, and the income tax is 4s. 6d. on the other side, that is fundamentally wrong, because those whom the Party opposite always imitate have a 4s. 6d. income tax.

What did the Minister for Finance say in connection with this matter? He indicated that the low income tax here helped in the recovery of the ownership of capital which had gone out of the country; and was attracting it back. I hope Deputy Flinn is changing his banking account. That recovery has, to some extent, taken place, and will take place if our tax is kept stable. What is the meaning of that? The meaning is that new money will flow into the revenue here in respect of which there is a negligible expense for collection and for which practically no service has to be rendered by the State.

Is it needed? If we are going to make comparisons between this country and Great Britain, let it be realised, once and for all, that we have by no means the wealth they have there; that industry is struggling here; that every effort must be made to keep capital and industry in the country, to give people who are engaged in the various commercial and manufacturing activities every possible inducement to sink still more money in them and attract still more people here. If there was no other reason for it than that we were getting income tax from these people, it is very good business. In fact, as the Minister said in connection with the income tax that we would get from that source, it has increased and it is increasing. Money will also come in in respect of death duties, stamp duties and other activities of one sort or another, apart from the question of the extra employment. I regret very much, that in the very few minutes left at my disposal, it is not possible to explode the political heresies which we have been listening to for the last two days. There were quite a number of them.

Mr. Davin

You have Wednesday for that.

The President

The fact is that I was being closured out from the Press to-morrow by Deputies opposite. I have just anticipated that little manoeuvre on their part. One thing stands out very prominently in the speech of the Minister for Finance in connection with the general financial situation in this country, which deserves particular mention, and that is that the dead-weight debt, apart from the £250,000 per annum paid to the British Government under the Act of 1926, is a little over £15,000,000. For eight successive years the same Minister has introduced the Budget here, balancing it every year.

Mr. Flinn

Never.

The President

That is the trouble in this country. I believe it would be a greater satisfaction to the Fianna Fáil Party to be able to prove that there was not a sound financial situation here in order to get a change in Government than the interests of the country.

Mr. Flinn

That is not true.

The President

The facts speak for themselves in connection with the financial situation.

Mr. Flinn

We will follow.

The President

The Deputy cannot unfortunately.

Mr. Flinn

Somebody else will.

The President

£15,000,000 is the dead weight debt. If that sum is not disputed, very good. That is the record for eight years. As the Minister said it is evidenced by the fact that we were in a position to borrow at a more favourable rate than some countries with a much more favourable tradition and which are much longer established. In the case of Japan the interest is £6 13s 8d.; New Zealand, £5 1s. 8d.; India, £6 4s. 9d.; Germany, £6 13s. 8d. per cent., and the percentage here allowing for redemption by final date is £4 17s. 6d. There are some other figures which I intend to deal with next week. I should like to say, however, before closing now, that Deputy O'Connell, Deputy Anthony and Deputy Nolan, all paid a well deserved tribute to the Minister for Finance in connection with his long and favourable record as Minister for Finance. Deputy Redmond was the first to notice it, and he has, perhaps, this advantage over Deputies opposite, that he has had experience of two representative institutions. His comment in connection with the statement made by the Minister was that if it were made in the British House of Commons it would have brought congratulations from all sides of the House apart from the fact that a particular person was the instrument for making the announcement, as a great national benefit which would give pleasure and hope and satisfaction to every citizen who had the welfare of the country at heart.

Progress ordered to be reported.

The Dáil went out of Committee.

Progress reported; Committee to sit again on Wednesday.

The Dáil adjourned at 2 p.m. until 3 p.m. on Wednesday, May 13th.