Deputy Cosgrave talked about balanced budgets—"occasionally there was a balanced budget". As I said at the beginning, these are difficult times for people in my position. However, from the strictly financial standpoint and keeping in mind the strictest canons laid down by any of the financial writers or economists, I do not see that there is anything—financially speaking—wrong in the Minister for Finance setting aside in any year a portion of his expenditure as capital expenditure. My predecessor here did that and was challenged in several years by the Opposition. When expenditure of a capital kind is spread over a number of years, I do not agree that it is wrong to charge a certain proportion as capital expenditure which will benefit the country for a long period, and to divide it over four, five or ten years, or whatever number of years may be adequate.
It must be understood clearly that it is capital expenditure, the fruits of which will come in when the capital has been fully expended and when the institution or building, as the case may be, is brought into full use for the operation of certain services on behalf of the State. Because that factor has been introduced into budgets here in the past, Deputy Cosgrave has objected and claimed that my predecessor's budgets, or some of them, were not balanced. I do not agree with that view. I suggest that, judged by the strictest financial standards, the budgets of my predecessor were as honestly—that is a word that Deputy Cosgrave used—balanced as any budget of a former Minister for Finance in this House.
The Deputy claimed that, during the last eight or nine years, we made no effort to increase the productivity of the country. That is a charge which cannot truthfully be levelled at this Government. Certainly, we set to work with great energy. The present Minister for Supplies is a man of energy and ability. He was put in charge of the policy of industrialising this country, and carried that through with a great measure of success. He brought new industries into existence here, some of which it was thought never would have been successful in this country. Increased numbers of men and women were put into industry to manufacture things which never had been manufactured here before. In that way, we added materially to the productivity of the country, so it is not true to say that we did not do so during our period of office.
We tried to carry out the Sinn Féin policy of industrialisation. Before the split in the Sinn Féin Party on the Treaty question, the gentlemen on the Front Bench opposite were associated with Sinn Féin—Deputy Brennan was one, and Deputies Cosgrave and Mulcahy were others. We all preached the industrial policy that Griffith taught. It was he who gave us those ideas; he gave them to Deputies Cosgrave, Mulcahy and Brennan as he gave them to me. We adopted them and propagated them; we went around the country asking people to back Sinn Féin and the Independence Movement for the purpose of enabling Ireland to acquire political and industrial independence. Griffith—the Lord rest his soul—got no opportunity to put his own policy into operation. He was not spared, but his disciples were there, and the Deputies opposite were as much his disciples on that matter as I was. We all understood that, when they got power, they would endeavour to build up industries here and not allow Ireland to continue as it was until then— practically an agricultural country, with the consequences that meant to the general standard of our wealth.
As well as housing that is one of the several reasons I mentioned why Fianna Fáil was given office. It was worth mentioning for this reason, that we were charged with being extravagant and increasing the number of civil servants and their salaries. In order to introduce that policy we had to increase to a considerable extent the staff of the Revenue Commissioners, to implement the tariff policy that was necessary for our industrial progress. Deputies on the opposite benches are blaming us because we put into operation the policy that the founder of Sinn Féin, Griffith, stood for and preached all his life, but which they failed to operate when they had the machinery of office in their hands.
Deputy Nally went through the Book of Estimates and took the figures for 1932 and compared them with the figures for this year and last year. Take education, on which we spent £60,000 more in 1932, and this year we are spending £80,000 more. These are rough figures, and I am not quoting what the Deputy said exactly. If there was never a change of Government, if Deputy Cosgrave and his Government had remained in office for the last eight or nine years, or if there had not been one added to the staff of the Civil Service, the cost would be increased by 10 per cent. or 15 per cent., because when the State was set up the civil servants were mostly young people. Civil servants' salaries are graded, and when they reach a certain maximum, if they are qualified, they can go higher, so that there would have been a considerable increase in every Department if not one person had been added to the Civil Service. It is not true to say that we are responsible for all the additional expense shown in the Book of Estimates for the various Departments for this year compared with 1932. The Deputies who made that statement did not take what has happened into account. Deputy Cosgrave wondered how expense could be decreased at the end of the war, and he quoted a phrase of mine in the Budget speech, in which he said I looked forward to the day when the present heavy burden could be lightened with advantage to the well being of the nation. "Surely," the Deputy added, "the Minister must have been serious when he made himself responsible for that statement." He also asked how it was to be carried out.
In the Budget statement I said what I think should be obvious to everybody, that to put it in a modest way, we are spending four times as much on the Army this year—in reality more than four times as much—as we spent before the war. There is £6,000,000 alone— and that is a considerable sum for this country—that need not be spent if we had peace in the world around us. Deputy Linehan, who made what I thought a very good speech, stated that once expenditure goes up it never goes back to the same figure. There is a good deal of truth in that statement. The House is as much responsible for that as the Government or the Minister for Finance. Once taxes have been imposed and we become accustomed to a large revenue, one hundred and one projects spring to the minds of Deputies in all Parties, that they think may be excellent projects, and excellent ways of spending money for the benefit of the nation, but that may not be thought practical or expedient in other circumstances because of their cost. We have now got to the realm of £40,000,000 for the Budget. That is an enormous figure. Deputies say that as the people have been made pay, and as income-tax and various other taxes have been raised, the people have got used to them, and as we have that much money, why not spend it on projects like the one Deputy Dillon is seriously interested in, family allowances.
Deputy Dillon, Deputy Linehan and Deputies in all Parties want family allowances. They suggest that if we had family allowances introduced we could do away with some other expenditure. Perhaps expenditure might be moderated on a service like home help, but you will never get rid of that service altogether. There are other people besides the people who would get family allowances to be thought of, and with family allowances there would be a considerable addition to the burden of the social services that we are at present bearing. The question of family allowances is being examined at present, but I should like to see the results of the examination before expressing an opinion. We would all like to do away with what is called poor relief. Every Party would like to do away with that service if it were possible. Despite the fact that we are dealing with the Budget in the realm of £40,000,000 we are not a rich country. That could not go on. We are doing it for the emergency, and in the hope that the service on which we are spending this money will keep us out of greater trouble. If we were involved in the war there would be no use in talking about the Budget, as money, property or anything else would not matter. If we want to take any account of the future, and if we have any hope of living anything like a normal existence, we cannot, I suggest, go on on the terms of a Budget of £40,000,000, because it is at a great sacrifice on the part of every class of the community that that heavy taxation is raised.
I mentioned that Deputies stated that once taxation reached a high figure it was very difficult to bring it down, but Deputies on all sides look forward to the day when peace is restored in the world, and when we can benefit, as we hope we will, by being able to save at least £6,000,000 that is now being spent on the Army. Whoever is Minister for Finance will not be allowed to save the whole of the £6,000,000, because there will be demands from all parts for projects, perhaps good in themselves, but that will be costly. Deputy Cosgrave wanted to know how expenditure could be decreased. I pointed out one item, and I hope it will not be long until the day comes that a very considerable portion of the expenditure on the Army can be eliminated from the Estimates.
As Deputy Cosgrave said, I propose to balance the Budget by borrowing close on £4,000,000. Some Deputies on the Front Bench opposite, Deputies O'Higgins, Linehan and McGilligan, for example, suggested that I should borrow a great deal more. There does not seem to be any unity of thought in financial matters on that side of the House. I get flailed by one set of Deputies for borrowing at all, and I get abused by another set of Deputies, sitting almost side by side with them, for not borrowing more. Deputy Linehan said I should borrow £15,000,000 and Deputy McGilligan asked why I should not borrow a great deal more. I thought I was striking a medium, not taking an extravagant view on one side or the other.
I propose to put on a very considerable amount of additional taxation. You realise, or you have been told by various interested parties, how the heavy additional taxation proposed has impinged upon, and will impinge upon, the lives of people in various ways. I do not think it would be wise to go much further this year with additional taxation. Neither do I think it would be wise to go much further with borrowing. If this war continues, God only knows what methods we will have to resort to yet, but for the present we will try to play as safely as we can, keeping in mind that we have to live, that this is not the last financial year, that there are other financial years to come that must be provided for.
As Deputy Norton reminded us, the struggle for life is hard. He says it is going to be harder than ever. That is probably true, especially if the conditions that we are now accustomed to continue. That is why we were obliged to take the measures that we took within the last week or two, with the standstill order as one side of it. Life is hard and it is going to be harder. We had the choice between allowing what happened in the last war to be repeated, or else trying to take measures to see that the disasters, financially and economically speaking, that resulted after the last war would not be repeated.
Despite the jeers about equality of sacrifice, we have sincerely tried to make the burden as equal as possible on all classes of the community. I know that Deputies on the Labour benches do not agree, but in proportion we have tried to spread out the burden as evenly as possible. I do not deny that the 4d. on the ounce of tobacco is a heavy burden on the poor people, but look at the thousands we are taking off other people. As some Deputies have reminded us, the man with £1,000 or £5,000 a year has had a heavy blister put upon him—no more moderate language can describe it. But Labour Deputies say: "What does it matter to him? He can live and he will never be short of a meal." Do Deputies on the Labour benches suggest that the proper thing would be to get that man who has, let us say, through his business or as a professional man or an industrialist, earned for himself a prosperous living, a good living and is used to it, and place him on a much lower level? Are we, in order to get that equality of sacrifice that seems to be in the minds of some Deputies, to oblige that man to live in a labourer's cottage on 30/- a week? The extravagant suggestions made by some Deputies put that thought in my mind.
