I move that the Bill be now read a Second Time. Under Section 42 of the Dairy Produce Act, no creamery was permitted to accept cream from a producer unless it was delivered as white milk. At the time, an exception was made in the case of Macamores Creamery, County Wexford, where it had been the custom for some years to collect cream from the farmers and to have the cream churned at the central station. It was thought at that time that three years would be sufficient to enable the creamery to fall into line with other creameries, but since that time it has been necessary to continue the exception granted in the original Act. Amending Acts to do so were passed in 1927, 1930 and again in 1933. I have now to come before the Dáil again to get an indefinite extension for this creamery, because it does not look as if the creamery will be able to settle down to the ordinary routine of other creameries and to collect milk, within any definite period. That is all that is involved in this Bill, and I do not think there can be any objection to it.
Dairy Produce (Amendment) Bill, 1937—Second Stage.
I know nothing of the circumstances of this particular creamery, but I take it that if this departure was deemed to be desirable on previous occasions, there can be no serious objection to a renewal of it. I do not know whether what I am about to say is strictly relevant, and I await your ruling upon it, but this is an amendment of the Principal Act and it is designed generally to make provisions in connection with the production of butter. We are all aware that a very strange situation recently arose in this country in which we were importing butter and paying 1/5 per lb for it. At the same time we were actually exporting butter to Belgium, Germany and Great Britain at about 8d., 9d. or 10d. per lb. Perhaps, the Minister would wish to take this opportunity to reassure us that this general scheme of creamery reorganisation is not being pursued with the intention of continuing a system whereunder we should seek markets on the Continent of Europe, in Germany and Belgium, to sell butter about 5d. per lb. less than our own people are asked to pay for it, and more particularly that we should not seek markets in Europe to sell our butter at 10d. per lb. and pay 1/5 per lb. for butter which we bring here from the antipodes. I would ask the Minister on this occasion to say whether, in his judgment, from the experience that he has now gleaned from working the new machinery under which the creamery industry is being carried on at the present time, some scheme cannot be evolved whereunder, if butter is sold at 10d. per lb., our own people can have the advantage of the cheap butter.
I recognise that, whatever price we get for butter, we have got to keep the creamery industry in existence because it is an integral part of the mixed type of farming which every rational person wants to maintain in this country, and if you allow it to be destroyed by fortuitous world events, it might easily bring down with it a number of other branches of agriculture which could be made wealth-producing industries in this country. But I cannot see how, if it is necessary to sell butter to the Germans at 10d. per lb., at the same time it is impossible to sell that butter to our own people at 10d. I would much sooner subsidise butter and give it to our own people for 10d. than subsidise it and give it to the Germans at 10d. I see, of course, that the Minister finds difficulty in getting the money requisite to subsidise even the exports of the present time. I think the way he has got that money so far is to knock it out of the Irish consumer by putting it on to the selling price of butter here, but from the social point of view, and the point of view of the industry itself, surely that is a bad thing to do. It would be much better if we could immensely increase the consumption of butter in Ireland by selling butter cheaply at the world price and give a direct subsidy to the creameries, if necessary, to keep them going, because in that way we might reasonably hope to expand very considerably the output of the creameries. I think that if we were to expand the output of the creameries the expense of producing butter would fall proportionately and the gap, which has to be bridged, would decrease proportionately.
The more butter we produce, the less subsidy it will be necessary to pay on each individual pound in order to ensure an economic return for the creamery. I am not asking the Minister to say now that he has any scheme whereby that end would be achieved but I would be interested to hear from the Minister whether, on broad general principles, he agrees with me that the policy pursued so far of giving the Germans and the Belgians cheap butter while our people have to pay a high price for butter was as good a plan as a plan whereunder a direct subsidy would be given to the creameries and the consumption of butter would be encouraged and extended amongst our own people, particularly that part of them who are living in large urban centres such as Dublin, Cork, Limerick and Waterford.
I am very interested in the suggestion which Deputy Dillon has made and I would ask him to state, with a view to our fully understanding his proposal, whether he intends that butter should be sold here, if the world price is an uneconomic price, at an uneconomic price.
I do not quite follow what the Deputy means by an uneconomic price. I have always held that if a foreign country adopts what I have described as an inverted tariff, that is to say, if a foreign country to suit its own internal economy subsidises exports, it is a perfectly legitimate thing to put on a tariff equal to the exporting country's subsidy, otherwise you leave yourself a prey to any country which wishes to interfere with your economic life and to upset it by giving export bounties. But if circumstances are such that you have a surplus product, that you have resolved on exporting some of it, and that world conditions are such that, in regard to that exportable surplus, you have to take a low price, I would much sooner that that surplus should be consumed by our own people at the low price, than to charge our own people a high price for butter in order to give it to the foreigner at a low price.
This seems to the Chair to involve legislation.
I recognise, Sir, that it borders on a pretty wide discussion, but then of course this Bill is for the purpose of carrying on the general scheme of creameries.
Do I understand Deputy Dillon to mean that if, because of an export surplus, the price of butter here is an uneconomic price for the producer, then butter should be sold to the consumer at an uneconomic price, and the producer should be compensated out of general taxation?
In the special circumstnces which I outlined at the beginning of my observations, I would much prefer to give cheap butter to our own people than to give it to the Germans and the Belgians.
It is not true to say that we are selling butter to Germany at 10d. per pound. We are getting what Deputy Dillon would regard as the world price, and that is whatever best Australian butter might be quoted at in London. That is much above 10d. at the moment.
At the moment; it was not above it earlier in the year.
Dr. Ryan
Let us take the price of Australian butter in London at the moment when it reaches the consumer. I have quotations here from the grocers. During the last few weeks it was sold for 1/3 a pound over the counter, which is the very same price that we are charging our consumers here. I do not see that there is very much in Deputy Dillon's argument, because we all appear to be on the world price that he talked about. Germany is paying the world price for our butter.
What has Germany paid for Irish butter during the last 12 months?
Dr. Ryan
At the moment I would say it would be about 110/-, because that is the Australian price in London at the moment.
The Minister must know what it is.
Dr. Ryan
I cannot say whether it is 108/- or 112/-; it is probably about 110/-. In London about ten days ago New Zealand butter was 1/4 to 1/3, Australian butter was 1/3, and Danish butter was 1/6; so that if we regard our butter as at least as good as Danish butter, if it is not better—some of us think it is better—our consumers are getting very much better value, and getting it at the world price. Our consumers are getting very much better value when you take it that the English consumer in London is paying 1/6 for Danish butter, 1/4 for New Zealand butter, and 1/3 for Australian butter, while we are selling the best butter in the world for 1/3; so that I think there is not very much in those arguments which the Deputy has raised.
With regard to the import of butter, as I explained before, that was entirely due to unforeseen circumstances. I cannot say definitely, but it was supposed to be due both to the very bad hay during last winter on account of the bad harvest, and to the very cold weather during the winter that our production was down. Our production was down about 20 per cent. during the early months of this year, and consequently we had to import butter. That was the only time we had to import it for four or five years, and I hope it will not occur again.
According to what the Minister now tells the House, butter is now making a better price in London than it is making here.
Dr. Ryan
Oh, no, I did not say that. I did not say we are getting more in England than here.
The Minister was telling me a moment ago that the English people are paying more than we are paying.
Dr. Ryan
That is right.
If that is so, why is it necessary to put any levy on our butter at all?
Dr. Ryan
There is practically no levy now. It is only nominal.
But there is a levy.
Dr. Ryan
It is only nominal.
I should like to ask the Minister what was the average price at which we sold butter to Germany during the last 12 months? What was the approximate figure to within 5/- per cwt.?
Dr. Ryan
I would say about 105/-.
All the year round?
Dr. Ryan
Yes, in 1936.
I should be very glad if those figures were forthcoming. If it is true that we had been getting on the Continent and in Great Britain a price practically the same as we were getting in Saorstát Eireann, I am at a loss to understand why it is necessary to provide a large sum in the Exchequer and a large sum by way of levy for the maintenance of the butter industry. The butter industry should be able to pay its way.
Dr. Ryan
I do not say we were getting a better price in England than at home. The creamery that ships butter to England at the moment gets, I should say, 109/-. They have, of course, to meet expenses and tariff going into Great Britain. Against that we pay subsidies. We pay, in addition to that, a subsidy to bring that up to what we consider a fair price, which for this month would be 117/-, so that the subsidy goes not only to pay the tariff into great Britain but also to pay the difference between the world price and what we consider an economic price.