When progress was reported, I was dealing with the gibe which the Minister for Finance had seen fit to throw at me for the suggested figure of £50,000,000 as the adverse trade balance of last year. I had quoted exactly what I had said in the debate on the White Paper on the Supplies and Services Bill. It is interesting, however, to note the manner in which the £66,000,000 that was referred to this afternoon by the Minister for Finance has been come by.
In paragraph 28 of the White Paper, which was issued last year by the Department of Finance, they arrived, after making certain assumptions, at the view that the import surplus for the whole year would, on these assumptions, amount to £129,000,000. Having arrived at that total for the import surplus, the White Paper proceeds, in the following paragraph, to deal with items on invisible account, invisible exports as they are called, emigrant remittances, tourism and other matters of that kind. That paragraph reaches the conclusion that the total of these invisible exports for the year 1950 would be £56.8 million. In a further part of the same paragraph, having again made certain assumptions and calculations, the White Paper comes to the conclusion that the items on invisible account, invisible exports for the year in question, 1951, would be £60,000,000, a little over £1,000,000 greater than the year 1950. Accordingly, deducting from the import surplus of £129,000,000 the £60,000,000 on invisible account the item of £69,00,000 was reached as the estimated deficit. In paragraph 30 they have rounded up the figure to bring it in the region of £70,000,000.
When accurate figures and statistics were available, it transpired, in fact, that those responsible for the compilation of the White Paper had made a little error of £6,000,000 in their estimate of the import surplus for the year 1951 and that the import surplus, instead of being £129,000,000, was, in fact, £123,000,000. If the deduction which they had made in the White Paper of £60,000,000 for invisible items was made, the deficit would be £63,000,000. It was coming down very drastically from the sum of £70,000,000 but it did not suit the Minister or his advisers. What did they do? Instead of deducting on their own figure of £60,000,000 for the estimated items of invisible exports they deducted the figure for 1950 which they had stated in the White Paper at paragraph 28 as £56.8 million and they reached the figure of £66.2 million. £66,000,000 is the figure that the Minister mentioned to-day.
That is no reliable estimate because what, in fact, was done, as I have demonstrated, was that the Department of Finance, its officials or whoever it was compiled the figure of £129,000,000 for the import surplus, having been proved wrong with the estimate of £6,000,000, tried to cover up this error and get a bigger deficit in the £63,000,000 by taking the 1950 figure instead of their own figure for 1951.
Of course, in any event, these figures for balance of payments and balance of trade are only estimates at best as I indicated in a speech I made last November on the Supplies and Services Bill and which I quoted to-day. They are not made with any degree approaching accuracy until six or eight months after the close of the financial year. We will await with interest final figures by our own independent statistics office when they are in the position to do it independently and on their own.
The Minister for Finance, in the opening part of his statement to-day, tried to cast aspersions on the financial probity of his predecessor, Mr. McGilligan, the Minister for Finance in the inter-Party Government. He tried to show this volume of Estimates we are discussing on this Vote on Account really shows a startling decrease in expenditure and, of course, nobody is to bother about the fact that, whereas both capital items and ordinary supply and other services amounted, in the year 1951-52, as disclosed on the outside of the Book of Estimates for that financial year, to the sum of £81,361,000, the figure for this year is £94,871,623, and that that startling increase of something over £13,500,000 is not really an increase at all because they are savings really that are explicable by the financial trickery of the last Government.
Before this debate is over, it will be established again what was established before in the course of the debate on the Supply and Services Bill and the White Paper that Deputy McGilligan's last Budget of his last year would not merely balance but would probably show a surplus. Every effort that has been made, every device that can be employed will not conceal that fact. I have the figures before me to prove it, but as I have other matters to speak about to-night I do not want to take up the time of the House too long. Deputy McGilligan demonstrated last year, on the Supplies and Services Bill, that his Budget would balance and that every suggestion of financial trickery that was made by the Minister for Finance at that time was false, untrue and disproved.
The Minister for Industry and Commerce replied on that debate and this is a significant fact, he is no mean debater. All the Minister for Industry and Commerce could say about the figures that were produced at that time by Deputy McGillian in defence of his financial policy and in proof of the fact that his Budget balanced and was framed and devised on strictly correct financial principles was that he was not going to deal with figures. Before this debate runs its course, these figures will again be brought before the House and every allegation of trickery so easily made by the present Minister for Finance and so falsely put forward will again be demonstrated to be untrue. We have had experience that it is very difficult to catch up on a lie. That allegation against my colleague. Deputy McGilligan, as Minister for Finance, has been repeated over and over again throughout the country notwithstanding the fact that at last we have got it into the heads of the people that the present Minister is more concerned with casting aspersions on the financial policy of Deputy McGilligan than he is in safeguarding the credit and the interests of the people of this country.
May I just refer to one or two matters to demonstrate the confusion that has been caused by the method adopted in the Book of Estimates for the coming financial year? I shall have occasion later to deal with the abandonment of the policy of the segregation of the items of capital and current account. There is only one figure on the face of the Book of Estimates for this year and an effort is made throughout the book to suggest that the only real increase over last year's bill that was presented to the taxpayers and that ultimately had to be paid by them either in the original Book of Estimates or in the Supplementary Estimates was a comparatively small sum of something over £600,000.
The Minister for Finance glibly talks about financial tricks. I do not like to use these expressions but I use one on this occasion. I say that it is little less than a trick on the part of those who are responsible for the compilation of this Book of Estimates to put in, as part of our Estimates for last year—as an item that ought to have been dealt with in one year, and that last year—the figure for the fuel subsidy to which reference was made by the Minister for Finance in his opening statement to-day. The House and the country have already got the history of that subsidy and of the appalling burden it signified when we came into office in 1948. At that time it was something over £5,000,000. It was reduced. There were some losses involved by reason of the fact that some portions of the fuel dumps could not be sold at any price and would not even be taken away for nothing. Because of the shortage of British coal, a certain salvage was made towards the end of our term of office. Here, however, the sum of £3,080,000 appears, if you please, as an item that was in our Book of Estimates for one year, and that last year. There is no justification, even from the mouldy principles of officialdom in the Department of Finance, for putting that item there. To adopt the phraseology of the Minister for Finance, it is financial trickery. That £3,080,000 represents the residue of a damnosa haereditas that was foisted upon us by the previous Fianna Fáil Government, and, from over £5,000,000, it was reduced to a little over £3,000,000.
The present Minister for Industry and Commerce stated in this House— and he has been charged with it repeatedly and has not denied it—that it was not an item that should be paid out of current taxation. "Put it," he said, "as part of the national debt, and you will be well out of it and the country will be better out of the war than any other country in the world." Of course, it was part of the national debt, and Deputy McGilligan intended it to become part of the national debt when he had salvaged as much as he could out of sales and so forth. But it is put in here by way of a reduction of their Estimates this year and to show how careful they have been in their estimating this year.
The Minister referred to-day to the provision with reference to housing in the Local Government Vote. As he said himself, that was only an apparent decrease. It was quite apparent that it was only an apparent decrease, but it was brought in here in order to delude those people who are trying to find out the real truth behind that volume of Estimates into thinking that there was a reduction in the Minister's Bill. It was our policy—and we had started to take the initial steps and even to bring them very near to completion—to recast the entire finances of the housing programme. What is happening here is that, surreptitiously, the present Government are carrying out our housing financial policy, which is part of our capital programme. They are really carrying out our capital programme and hiding it by a device of an apparent decrease in the Book of Estimates. Similarly with regard to the land rehabilitation scheme. From the figures in this Book of Estimates it would appear that more money was being provided this year for the land rehabilitation scheme than was provided by Deputy Dillon, as Minister for Agriculture, last year, and that, therefore, there is a reduction in the Bill which is being presented to the taxpayers under this heading. That is not the fact at all. It is done by juggling the figures into another Estimate—the Agricultural Estimate, I believe.
Reference was made to the £200,000 for, I think, the ground limestone subsidy. That appears as an account in the Book of Estimates. Of course, that was part of the Marshall Aid grant. It was never intended or designed to be a tax on the taxpayers at all. That £200,000 was part of the moneys that were coming to us as a credit grant from the people of the United States. It was agreed between the then Minister for Agriculture (Deputy Dillon) and Mr. Millar, who was the head of the E.C.A. Administration in this country, that, in anticipation of the schemes which would be ratified between this country and the United States with reference to the expenditure of that grant, £200,000 would be allocated to lime subsidy for the farmers. That was to go as a free grant to the Irish farmers from the people of the United States. I shall have occasion later on to speak about the Minister's handling of the Marshall Aid funds, and of this fund in particular. That sum of £200,000 should not appear in these accounts at all. It was never intended to be paid by the taxpayer, either as an annual sum or as a capital item. It was a free grant to the Irish people but in order to delude, deceive and confuse those people who wish to understand the scope of these Estimates—what is behind them and if any policy is behind them—that item is dragged in.
I take just these few items as an indication of the manner in which this Book of Estimates has been presented to the public and as indicating the policy behind the financial efforts of the Minister for Finance and his colleagues. The sole purpose and desire of it, as I said earlier, is to score politically off their political opponents and to try and make it appear to the people of the country—even at the expense of destroying our credit, both at home and abroad—that there is something fundamentally wrong with the credit and the financial structure of this State. That procedure has done almost irreparable harm. That is a slight indication of the confusion which is intended to be brought about by this Book of Estimates.
The Minister for Finance, almost copying the jargon that has become fashionable in British financial circles, spoke about the dreary picture of austerity we would have to put up with in order to secure that prosperity which is supposed always to be around the corner. So far, whatever schemes the Minister may have in view further to depress this country and to prevent that development of its resources which is the real answer to our difficulties, and not the nonsense that is coming from the Minister for Finance and his antediluvian advisers, the only contribution we have been told about is the reduction of the travel allowance to £25. I want to make a protest against that reduction, and I assert here that, if we were in office, we would not have allowed that reduction. This reduction in the travel allowance will give practically no help towards the solution of whatever problems the Minister has or thinks he has, whatever problems have been created in his mind by the fevered imagination of officials of the Department of Finance, officials who think that Ministers who are charged with a certain responsibility are not capable of doing their job, and that a gloomy picture must be always kept before them in case they expend a few pounds on the resources of the country.
I protest against this reduction. I describe it as a symbol of the step by step policy which the Minister for Finance has initiated and is carrying into effect—step by step with Britain. This is a symbol of our financial dependence on Britain. We had fixed £100 as our travel allowance. The British reduced that by £50, and within a few days our allowance was reduced by £50. The British recently reduced theirs to £25. It would not have looked too well for the Government perhaps if ours were reduced as quickly as the previous allowance had been reduced, but it was reported in the newspapers, and correctly reported as it now transpires, that it was intended to reduce further the travel allowance here to £25. Whether that was done following upon the Minister's exchange with the British Chancellor of the Exchequer, or whether it was for the purpose of bolstering up the gloomy prognostications with which he has flooded the country in the last few months, or for other reasons, I cannot say, but out he comes with it as a contribution towards the strenthening of the £. His colleague, the Minister for Posts and Telegraphs, in a recent speech, spoke about our contribution to the strengthening of the British £.
This is our contribution so far to the sacred cow of sterling. I protest against it as a retrograde step. Our young people have been deprived through wars and through difficulties caused by this war-peace, from the educational facilities that they require, from the acquistion of the culture that they need in order to fertilise our own country and our own ideas. The Minister for Finance threw the gibe across the House at Deputy Dillon that it was only the rich people who took advantage of these travel allowances. If the Minister for Finance would get himself out of the false and artificial atmosphere engendered in his Department and would get down the country now and again, he would know that it is not rich people only who go away to the Continent. It is the ordinary people who save money out of their wages and salaries in order to go to Lourdes and Rome and, incidentally, to see other places on the Continent, to educate themselves and to broaden their intellects.
It would be a very good thing for the people of this country if foreign travel were put more within their scope. Our outlook would be different; our ideas would be broadened. Contact with people abroad would show us how much more contended we should be and how happier we are than many people on the Continent of Europe. I think that, apart from the spiritual benefits that flowed to numerous people in this country who went to Rome during the Holy Year, and who took advantage of the pilgrimage to see other parts of the Continent, great benefit accrued to this country from the fact that so many people were able to see the circumstances in Italy, the hard work that the Italian people had to put in to rehabilitate themselves after the damage and havoc caused by the war and even by the peace. They were enabled to see the problems of France and Germany and to see the conditions under which even the British people who won the war had to subsist.
We do not want to be dependent upon British culture alone. I have the greatest respect for English literature, art, poetry and the English way of life. I think it is a very good thing that we should know of these things but we have every facility for getting to Britain, indeed far too many facilities. It is on behalf of the ordinary working people, the middle-class people, who want to go away to see for themselves what the conditions are in Europe, to broaden their mental horizons and to enrich their cultural aspirations, that I think this mouldy conception should be set aside. Certainly, so far as I am concerned, I enter the strongest possible protest against it. We are supposed to be relying as one of the great factors in reducing the gap in the balance of payments, which is an obsession of the Minister for Finance, on tourists to this country. How can we expect to attract tourists from abroad when we take the retrograde step of preventing our own people from becoming tourists in other countries? How do we expect that our young people growing up can broaden their mental horizons and can gain that breadth of vision which is so essential to this country if it is not to sink into that state of insularity into which it is in danger of sinking, if our young people do not travel? I think that this particular item, small as it is, is merely an indication of the obsession of the Minister for Finance in regard to the problems which he thinks confronts this country. There are problems, serious problems, facing us, but are they the same kind of problems, requiring precisely the same type of solution as the problems which confront Great Britain? I have repeatedly emphasised in speeches which I have made recently that there are fundamental differences between the ills which afflict our economy and those which are eating into the economic and financial structure of Great Britain.
Our problem is the problem of the development of our resources. Our problem is the fact that we have suffered here in this country for years from this: that we have large resources in men and land underdeveloped and awaiting development. That is our problem. That is what we have to face, and that is what the Minister will not face. We say that it is the height of folly for any Irish Government to initiate and to apply to the circumstances in this country, which are entirely different from those in Great Britain, techniques which the British in their dire distress have to apply in the solution of their own British problems. I think we may express not merely a passing admiration but a sincere few words of genuine admiration for the courage with which the British have faced the problems which confront them, and for the ordinary people of Great Britain who have suffered so long since the last war with very little hope of prosperity round the corner.
I want here again very shortly to indicate in this House and to repeat what I have already said in the country, so that it may be clear to everybody's mind, the principal distinctions between this country's problems and those of Great Britain. As I have said before to-day, we have a problem in the balance of payments. There was a crisis with the Minister for Finance last year. The Minister's colleague, the Minister for Industry and Commerce, sought to solve it down to a problem. It is an obsession with the present Minister for Finance. The long-term problem with us, a problem that requires to be carefully watched, a problem which does not and ought not to obtrude itself as it is obtruding itself too much in the consideration of our financial and economic difficulties, is development.
The British problem is different. We are a creditor country. Great Britain is a debtor country—perhaps the greatest debtor country in the entire world. Britain's debt amounts to five times her external assets. Ireland's external assets amount to a very considerable sum and will remain at that figure for a very considerable period in spite of the horrors which the Minister for Finance and his colleagues have tried to conjure up in the last few months. Our external assets will remain for very many years, even though we have a policy to put into operation, a policy to put apparently to be put into the limbo of forgotten things, a policy for the repatriation of our external assets. The gap in the balance of our payments, as I pointed out before, is merely a method of getting what we ought to have got during the war—goods in return for our produce that we sent to Britain during the war and for which we only got depreciated and depreciating British sterling.
Great Britain is hungry for foreign capital and it cannot get it. Foreign capital is seeping in here pretty gradually and pretty steadily but it is frowned upon, certainly by the policy of the present Ministers and their advisers. The national debt of Great Britain is two and a half times its national income. Our national debt is half our national income. We could multiply by five that national debt, and if we did so in relation to our national income we would not be any worse off than Britain is at the present moment.
I have said that our problem is development. Great Britain has reached a degree of productivity that it will take us years, if not centuries, to reach. Great Britain is an economically mature country. Our country is under-developed. It is crying out for development and for capital expenditure. That capital expenditure is being denied by the change in policy which is shown in the Book of Estimates this year. We can get here in this country a greater yield and a better return for capital expenditure upon our development than Great Britain can upon her investments. We are perhaps the only country in Western Europe that has not got an investment trust. Great Britain was the money market of the world for years and is replete with financial institutions of the kind I have referred to.
We all know the policy of our present bankers and banking systems. We know that they want to keep their liquid reserves in Great Britain instead of investing them in this country. The banking system of this country is based on taking in the deposits of our farmers and the savings of the people and of sending them to England to invest them in English securities, mostly trustee securities. Instead of investing them here in this country, they invest them in trustee or other securities abroad. That is not what Britain does with any loose money that may be available to her.
We are a food-producing country. Great Britain is an industrial country in a world that is starving for food and that is crying out for agricultural produce. If we take the proper steps, we have unlimited markets before us. We have unlimited capacity for production and for the sale of our agricultural produce.
The Minister for Finance, in his plaitudinous peroration this afternoon, spoke about the necessity for more production and more exports. We have been listening to that for months. What is wanted is not appeals to the farmers to work harder. That is irritating talk. The farmers work very hard. As I said in Carlow last Sunday, they work too hard, having regard to the conditions under which they have to work. Mere talk about production is not sufficient. What is wanted is a policy for production, and that is not forthcoming from the present Government.
We have here in this country hopes which we trust will be fulfilled for the further development of our tourist industry. Does anybody think that such an industry can be developed and fostered and brought to the point where we would wish to have it, and where the Minister's colleague, the Minister for Industry and Commerce, said he wished it to be the other evening—second to our agricultural industry? In fact, he would even like to see it producing more money than our agricultural industry, if one is to read between the lines of his utterances. Can such an industry be developed under austerity conditions? The British Industries Fair was a failure because of the austerity conditions under which it was held. How are we going to gain that huge amount of money which we trust will come our way if tourists from abroad are to find themselves faced with austerity conditions in this country—unemployment, unrest, uncertainty and confusion such as exist to-day?
May I again revert to the Minister's bogey, the gap in the balance of payments, and his horror of our policy for the repatriation of external assets and the dark and gloomy conditions caused by last year's deficit? If, as we all hope, there will be a large influx of tourists into this country this year, then we will be thanking God and, incidentally, the last Government, for that gap in our balance of payments of which such complaint is made now. At the present moment, industrialists are producing more goods and cannot sell them. The merchants have their shops stocked with goods. That was brought about by the policy that resulted in portion of this gap, by stockpiling. If the tourists come in their millions, as we hope they will, these goods will be there for them to buy in foreign currencies that we need so badly. If the austerity programme that the Minister for Finance wishes to impose unnecessarily upon the people is given its full scope from where will the goods come with which we hope to lure the foreign currency out of the pockets of the tourists?
We have had a spate of oratory, addresses and talks about the dangers of inflation here. No words were too picturesque to paint the dangers facing us from this evil of inflation. Of course we have inflation here, as everybody knows who has felt upon him and his family the impact of the cost of living. Of course, there is inflation in Great Britain. Last year the Chancellor of the Exchequer got something like £500,000,000 sterling as a surplus on his Budget. He budgeted through taxation on the people of Great Britain to produce to the Exchequer something in the region of £500,000,000 sterling. That was not enough to deal with the situation then and the economists were crying out that that was not enough and that there should be more. Yesterday's British Budget was the answer to that—more austerity and more taxation in order to produce a greater surplus still than that colossal surplus of revenue over expenditure in the region of £500,000,000.
It is the old tag of too much money chasing too little goods. There is too much money in Great Britain because of the rearmament policy and because of the policy of restriction on imports. That is what is causing inflation and bringing about all the evils that such a type of inflation is bound to bring about.
We have not got that type of inflation here. If one asks any business man here are there too many people with too much money looking for too few goods he will laugh in your face: there are too many goods and too little money here at the present moment. One of the results of the so-called financial policy of the Minister for Finance and of his speeches over the last eight or nine months has been to create in the people here a sales resistance; they will not buy goods and they are forcing prices down to a point where shopkeepers and business concerns are losing money. That is not the same type of inflation as exists in England. The Minister for Finance wants to get away with the idea that inflation is such an evil, such a terror and such a danger to the poorer sections of our community he must tax. He will try to get away with it on the excuse that in order to save the people from the evils of inflation we must tax and the people must put up with increased taxation.
There is no justification for additional taxation here by reason of the type of inflation from which we are suffering. It is a cost inflation largely imported from abroad but to some considerable extent of our own creation, too, because of tariff policies and tariffs and because of decreasing production to a certain extent, and the failure to produce sufficient to meet even the requirements of the home market. It is a cost inflation. It is not a type of inflation that can be cured by increased taxation. It will only be exacerbated by that. Increased taxation will increase the cost of living; it will increase the price of goods and materials and it will create again the vicious spiral with a demand for higher wages chasing higher costs. Instead of easing that particular type of inflation taxation, which is apparently appropriate for the British type of inflation and for the British problems, is entirely out of place in our economy and for our purpose.
I have given some indications of the difference between our problems because practically every day I see indications that the present Minister for Finance and his colleague, the Minister for Posts and Telegraphs, are obsessed with British conditions and British methods and with British political and financial theories. They seem to think that because there is that problem of inflation in England there is a danger in our touching the £ and we must therefore do something that the British are doing. I emphasise once more that our problems are different and, therefore, our approach must be different. I assert that the approach of the Minister for Finance, as demonstrated by his speeches and by his policy, so far as one can find a policy, in the Book of Estimates for the year 1952-53, is one that is based upon British financial theories, British conditions and outworn economic concepts.
Economic policy is indivisible. This Book of Estimates as it is framed and presented to us contains a jumble of supply services and capital projects. There is no way in which anyone examining that document can dissect its contents in order to arrive with any degree of accuracy at a segregation of those items which are properly appropriate to current expenditure from those properly appropriate to capital expenditure. We cannot really discuss this Book of Estimates and the policy that is supposed to be enshrined in it when our energies and our minds are diverted from what we should really be considering and discussing.
This Book of Estimates represents a radical departure from the policy enshrined in the Book of Estimates for the two previous years. We segregated items appropriate for current expenditure from items appropriate for capital expenditure and we indicated in each of these two books what items we intended as appropriate for financing through taxation in the current financial year, and we showed separately and in particular detail the items we considered appropriate to be dealt with through the medium of asking our people to give us, as a Government, their free savings for investment in Irish capital development projects.
Capital items in a Budget ought to be the same as capital items in a Book of Estimates dealing with the supply services. There is no difference between them, and when we are discussing here on this Vote on Account the financial policy of the Government, as enshrined in the Book of Estimates, we ought to be in a position to say that that, that, that and that are capital items and the remainder are appropriate for Government to discharge out of taxation in the current year. The ordinary Book of Estimates and the annual Budget deal with only about one-fifth of the country's economic activity. We believed that it was accepted economic theory that it was the Government's responsibility, not only to treat the people as taxpayers, but also as producers and consumers, and that each year's Budget should not merely allocate part of its public finances to its current yearly housekeeping expenses, but should also ensure that, as a matter of policy, the resources of the nation should be developed in the manner that best suits our own needs and requirements.
To give effect to that policy, we initiated the segregation in the Estimates of items of capital account and current account, and followed it with the double Budget. We then told Deputies and the people through this House: "There is what we propose to spend capital moneys on; that is what we say should be paid out of taxation." We asked and invited criticism on each and every particular item that we said was apt for capital expenditure, and we never got a single criticism of any item that we proposed to finance, not out of the ordinary taxation, but out of the free savings of the people.
That policy has been reversed in this year's annual Estimates. It has been reversed, not because anything has been proved to have been wrong with that policy of the dual Budget or with capital expenditure on development of the nation's resources but because the present Government would not admit that there was something good in the policy that had been initiated and devised by their predecessors, and for that reason alone.
What we should be doing here to-day is, not talking about our balance of payments in the way the Minister talked about it to-day, but finding a policy for it, not painting the gloomy picture which had been unnecessarily done by the Minister but finding means by which our undoubted existing problems can properly and adequately be dealt with. The problem of the balance of payments should not obtrude itself in the way that the Minister has allowed it to obtrude in the last few months. We should not be dominated in our consideration of our financial and economic position and policy by that one single item.
If increased production, particularly increased agricultural production, can be brought about, we will have gone very far on the way to rid ourselves of this spectre of the gap in our balance of payments and if we can find some policy for production, both in our agricultural sector and in our industrial sector, then we need not be talking in these melodramatic phrases which come so trippingly off the tongue of the Minister for Finance.
We are suffering from unemployment of men and unemployment of resources, particularly on the land. We cannot get the increased agricultural production that everybody admits is so urgently required unless there is a proper policy devised for that production. We can get that production that the Minister is calling for only by a proper policy for home investment and that proper policy for home investment can be got either from private savings or from public investment. You will not get in this country investment of a private character by private individuals as long as the uncertainty which exists in this country to-day continues, an uncertainty, I repeat, which has been brought about by the efforts of the present Minister and his colleagues, who have been painting an unnecessarily gloomy picture of the finances and prospects of this country, as if we were living in post-war England. The private investor is afraid of additional taxation. There has been talk of nothing else since the present Government came into office but additional taxation.
It was the policy of the inter-Party Government to reduce taxation because we knew that increased taxation lent its weight to increasing the cost of living, and to making worse the problems of inflation and the unemployment position. We reached a condition in which we were able to say without contradiction that we had attained the nearest point to full employment that had ever been reached in this country.
Now we have the position where there is uncertainty in business, unrest in agriculture, confusion generally, and unemployment mounting. Is that the time for a fundamental change in financial policy merely for the purpose of scoring off the policy of the Government's predecessors?
Public investment cannot be secured unless the necessary moneys are forthcoming. Because of all the talk that there has been about high taxation, because of the fact that the Minister and his colleagues announced months ago that they were going to reverse our policy of productive capital expenditure, and particularly because the Government failed in their public duty and their solemn trust to go to the public for a loan to finance the necessary projects of productive capital expenditure, it would be very difficult now to continue any policy of productive public investment.
Deputy McGilligan announced in his Budget last year that it was his intention, if returned to office, immediately to go for a loan from the people. In the course of his administration as Minister for Finance, he adopted principles of strict financial probity. Three times he came to the Irish public asking for their savings. In the matter of public investment the Government of which he was Finance Minister financed those projects of productive capital expenditure, first, by means of the free savings of the people lodged in trustee savings banks, in post office savings banks and in Savings Certificates. Those moneys, significant in amount as they undoubtedly were, were not sufficient for the purposes of public investment.
The Minister for Finance went to the people for a loan and told the people what he wanted their money for, and he thereby secured two things of very fundamental importance to the financial economy and stability of the country. There was loose money knocking around, moneys uninvested. By asking the people for those savings and getting them as he did get them from the people, he mopped up that loose money which would otherwise or might otherwise have gone into consumer goods. He did something else—he got the people used and growingly accustomed to the notion of investment in Irish productive enterprises. He was getting that into their minds. It is now stopped and impeded by the financial policy of the present Government. On the first loan that he went for he told the banks to keep out of it. He wanted money. He wanted the ordinary people who had savings to give them to the Irish Government in order to put them into the development of Irish resources, capital expenditure and Irish enterprises. He got the money from them.
In regard to the second loan he went for, he told the banks not to give any overdrafts, and told them not to allow any realisation or cashing of sterling assets, and to get in as much as they could of free savings that were otherwise not in use. He got the money from them. He assisted in keeping in check any such problem of inflation as afflicts the British economy at the present moment.
In respect of the third loan, which was his last and biggest loan, he procured the biggest individual subscription from the Irish people that was ever got by any Government or by any Minister for Finance in this country. He told the banks to keep out of it, but if they wanted to they could let in a certain amount of their own sterling assets from abroad. Ultimately, he would have gone last year for another loan, and had the present Minister for Finance sought a loan last July, as he ought to have done before the market crashed, he would have certainly got it from the people. We would certainly have co-operated with him and helped him, little as we thought of him and his policy. Had the Minister for Finance sought this loan, he would have got, on far more advantageous conditions than ever he will get again, the savings of the Irish people, but he will never get anything like the money he wants at the present time under such favourable conditions. The failure of the Minister for Finance to go for a loan last year is a sort of financial crime against this country and uncertainty has been created by the reversal of the financial policy of the present Government. This talk about an artificial crisis has nearly brought about a real crisis and it will adversely affect the chances of the present Minister for Finance if he ever goes to the country for a loan. That talk about an artificial crisis had disastrous effects on the finances of this country. The Minister for Finance said to-day that every penny of the £26,000,000 of the Marshall Aid that the previous Government left behind is gone.
