Would the Minister give us some information about the section?
Committee on Finance. - Finance Bill, 1952—Committee Stage (Resumed).
Question proposed: "That Section 8 stand part of the Bill."
Mr. O'Higgins
I think I gave the Deputy a lot of information about this on an earlier occasion. This is the section which increases the tax on spirits, so that from the 3rd April last the tax will be levied at the rate of £8 16s. per proof gallon.
Is the Minister not apprehensive that the extreme severity of this impost may, in fact, have an adverse result on the Exchequer instead of the one he hopes for? Does the Minister not consider in the circumstances of the taxation that the amount levied against this particular item may defeat the object that he has set himself out to achieve? Can the Minister explain to the House and, through the House to the country, why he asks this particular branch of the licensed trade to take this severe impost in one go? Can the Minister indicate to us what is the final tax potential capacity? Is he satisfied in his own mind that this imposition is, in fact, not going to defeat itself and that the severity of the impost will not result in such a reduction in consumption as to defeat the Exchequer return that he envisages? Has the Minister considered whether or not this imposition may not, in fact, have the complete reverse effect from the point of view of tax yield to the one which he at present envisages?
If I thought this tax increase would defeat the object that I have in view, which is to get money for the Exchequer, I certainly would not propose it to the House. The fact that I am submitting it to the House is proof that I am hopeful that the tax will give us the yield we anticipate. I do not think, in all the circumstances of the time, that the tax is excessive. It certainly compares very favourably with the taxes imposed on this commodity elsewhere, and even after the increase, substantial and all as it may appear to be, I think our people will still be able to enjoy each other's convivial company much less expensively than would be the case if they lived elsewhere.
What does the Minister expect to bring in?
A minimum of £20,000.
Question put.
The Committee divided: Tá, 67; Níl, 53.
Tá
- Allen, Denis.
- Bartley, Gerald.
- Beegan, Patrick.
- Blaney, Neil T.
- Boland, Gerald.
- Brady, Philip A.
- Brady, Seán.
- Breathnach, Cormac.
- Brennan, Joseph.
- Brennan, Thomas.
- Breslin, Cormac.
- Briscoe, Robert.
- Cunningham, Liam.
- Davern, Michael J.
- Derrig, Thomas.
- De Valera, Eamon.
- De Valera, Vivion.
- Duignan, Peadar.
- Fahy, Frank.
- Fanning, John.
- Flanagan, Seán.
- Flynn, John.
- Flynn, Stephen.
- Gallagher, Colm.
- Gilbride, Eugene.
- Harris, Thomas.
- Hillery, Patrick J.
- Hilliard, Michael.
- Humphreys, Francis.
- Kennedy, Michael J.
- Killilea, Mark.
- Little, Patrick J.
- Lynch, Jack (Cork Borough).
- McCann, John.
- Browne, Noel C.
- Burke, Patrick.
- Butler, Bernard.
- Carter, Frank.
- Childers, Erskine.
- Cogan, Patrick.
- Colley, Harry.
- Collins, James J.
- Corry, Martin J.
- Cowan, Peadar.
- Crowley, Honor Mary.
- Crowley, Tadhg.
- MacCarthy, Seán.
- McEllistrim, Thomas.
- MacEntee, Seán.
- McGrath, Patrick.
- Maguire, Patrick J.
- Maher, Peadar.
- Moran, Michael.
- Moylan, Seán.
- Ó Briain, Donnchadh.
- O'Reilly, Matthew.
- Ormonde, John.
- O'Sullivan, Ted.
- Rice, Bridget M.
- Ryan, James.
- Ryan, Mary B.
- Sheldon, William A.W.
- Sheridan, Michael.
- Smith, Patrick.
- Traynor, Oscar.
- Walsh, Laurence J.
- Walsh, Thomas.
Níl
- Belton, John.
- Browne, Patrick.
- Cafferky, Dominick.
- Coburn, James.
- Collins, Seán.
- Corish, Brendan.
- Cosgrave, Liam.
- Costello, Declan.
- Costello, John A.
- Crotty, Patrick J.
- Crowe, Patrick.
- Davin, William.
- Desmond, Daniel.
- Dockrell, Henry P.
- Dockrell, Maurice E.
- Donnellan, Michael.
- Doyle, Peadar S.
- Esmonde, Anthony C.
- Everett, James.
- Fagan, Charles.
- Finan, John.
- Flanagan, Oliver J.
- Giles, Patrick.
- Hession, James M.
- Hickey, James.
- Hughes, Joseph.
- Keyes, Michael.
- Kyne, Thomas A.
- Lehane, Patrick D.
- Lynch, John (North Kerry).
- McMenamin, Daniel.
- Mannion, John.
- Morrissey, Daniel.
- Mulcahy, Richard.
- Murphy, Michael P.
- Murphy, William.
- Norton, William.
- O'Donnell, Patrick.
- O'Gorman, Patrick J.
- O'Higgins, Thomas F.
- O'Higgins, Thomas F. (Jun.).
- O'Leary, Johnny.
- O'Reilly, Patrick.
- O'Sullivan, Denis.
- Palmer, Patrick W.
- Reidy, James.
- Reynolds, Mary.
- Roddy, Joseph.
- Rogers, Patrick J.
- Rooney, Eamon.
- Spring, Dan.
- Sweetman, Gerard.
- Tully, John.
Tellers:— Tá: Deputies Ó Briain and Killilea; Níl: Deputies Doyle and Breanndán Mac Fheórais.
Question declared carried.
SECTION 9
Question proposed: "That Section 9 stand part of the Bill."
I think it is reasonable to press the Minister at this stage to give us some justification for the savage taxes which this section imposes on what one might call the nonluxury drinking section of the community. Whatever arguments may be adduced in favour of higher taxation on spirits it does seem extraordinary in the light of the Minister's by now famous Rathmines speech that we are getting the impost on beer enshrined in this section.
It would be better to deal with that on the next section.
I will do my own job if the Deputy does not mind. If the little captain will direct his own army I will direct mine.
This is imported beer; you are talking about what is made in the country.
No, I did not talk about anything you mentioned anyway. The general principle underlying the attrack on beer is common to both sections and is contrary to the positive assertive assurances given by the Minister, then Deputy MacEntee, on the hustings in Rathmines, wooing in his capricious way the votes of the public. We want to know from the Minister the reason for this assault. Is it something sinister, something fundamentally spiteful, reverting to the catastrophe into which they led themselves before by this type of stupidity? We are entitled to ask the Minister why he has changed since he gave the categorical assurance, when dealing with honesty in public life and the whispering campaign, that there would be no impost good, bad or indifferent on the drinkers of the country. He made that the issue: whether there would be honesty or dishonesty in public life.
We have had enough somersaults on point 15 of the 17-point programme. This has been nearly enough to choke the erstwhile captain. We are entitled to ask both on this and on the next section what brought about the Minister's vicious somersault. What has changed his attitude since he was bewildered by the malign whispers that if Fianna Fáil were returned to power there would be an increase in the price of beer and tobacco? He described it as a mendacious whisper, something completely unfounded in fact, something completely nutrue. I would like him to explain now to his bewildered supporters around the country where the mendacity really was.
I had no intention of saying anything on this section until I heard Deputy Collins. I should imagine that when a Deputy speaks on what is undoubtedly a matter of some importance he should at least read the section first and speak to the section.
The Chair is the judge of order in this House, not the captain.
Deputy Collins after all has a considerable amount of knowledge and training regarding the interpretation of Acts of Parliament, and one would have thought that he would have given the Bill a little consideration so that his contribution would have been on the proper section. This section deals with mum spruce or black beer, Berlin white beer and other preparations, whether fermented or not fermented——
Berlin white beer is what the Taoiseach formerly thought we should have as light beer.
——imported into the State. I gather that what really interests Deputy Collins is the people who drink beers manufactured and produced in the country, beers of excellent quality.
This is a protective tax.
Is the principle of the taxes not the same?
I am talking about the section. The section deals with customs duties on imported beers. The point I am making is that when a Deputy comes to speak and speaks in the heavy language in which Deputy Collins has spoken, he should make sure first that he is speaking about the right thing.
Is this a lecture for the Chair?
Is this censure on the Chair?
It is criticism of the speech delivered by Deputy Collins.
I thought that the Chair was the judge of order. If I was not speaking to the section I was out of order.
I do not think that the Chair would like to pull up a Deputy on that point so soon.
The Deputy would not know the difference.
Deputy Collins has used very heavy language regarding beer duties, and I suggest that it would have been worth that little consideration to have read the section.
I will talk on the next section too. Do not worry.
It will be very awkward to have to use the same heavy language on the next.
No, I am not as limited in my vocabulary as the Deputy.
I know that the Deputy spends a considerable amount of his time in the repetition of big words, words of learned length and thunderous sound.
You are not too bad at that yourself for an army commander.
Far from improving the position of breweries in rural areas, I believe this section is causing the breweries to alter their economy. I am told on good authority that many of their staffs have been reduced as a result of the proposals here. It appears to be a double-edged weapon. We know of course that the farmers were made to bear their share of the burden. We remember when the Taoiseach and the Minister for Agriculture had a conference, at which the price for barley was announced at 7/6 less per barrel than the farmers had been receiving previously.
What has this got to do with Section 9?
I understand that barley is used.
German barley, Holland barley.
Deputy Cowan got up to castigate Deputy Collins——
No, I did not castigate him.
That is all the Deputy did. The Deputy read him a lecture for not reading the section and not understanding it and for speaking to something that was not in it. Deputy Collins at least indicated whether he was for or against the section, which is much more than Deputy Cowan did.
I would not let in this foreign beer at all.
In so far as the Deputy gave us any indication of his views or feelings on this matter, he was in favour of this section because it dealt with imported beers. Would I be right in assuming from that that he would be against the next section because it deals with home-brewed beers?
The Deputy may not assume that.
I was thinking so much. I can quite readily understand that neither Deputy Cowan nor the Minister are feeling too happy about these two sections, the Minister because of a speech he made in Rathmines Town Hall — I will have a few words more to say about it later — and Deputy Cowan because of the fact that that speech was made by the Minister and that assurance given. I am perfectly satisfied that Deputy Cowan and some of his colleagues were able to salve their consciences by remembering that speech and by remembering point No. 15 of the 17-point programme which was not put before the electorate but was put before the Deputies whose support was sought in order to ensure the election of a Fianna Fáil Government.
I do not read these speeches.
I do not read even my own, much less Deputy Cowan's. The Minister did make a very definite statement in his speech at Rathmines, and, listening to him replying to the debate on the Budget, I wondered whether the Minister meant one word of what he said, because he made what appeared to me to be a very significant statement in the course of his reply to that debate when he said that the additional duties which were imposed by the Government in the emergency Budget of 1947 should never have been removed. I think the Minister owes some explanation to the House and the country regarding this complete departure from the policy which he stated in connection with these commodities during the general election.
There is no doubt, whatever, so far as beer, or porter or stout is concerned, to a very large extent it is not a luxury in this country. It certainly has ceased, in the opinion of a very considerable number of people, and particularly certain sections of people, to be thought of as a luxury, and I put it to Deputies that it does enter into the budget of the average family. There is no doubt whatever that, if the Minister's hopes in relation to the amount of revenue he expects to get from the beer duties are realised, they can be realised only by the house going short of something else. I know, like every other Deputy, that, even at the new price, beer or stout or porter will be drunk, although, perhaps, not to the same extent, but if the Minister is to get his revenue, it will have to be very close to it.
I take the view that it is a very heavy impost. It will bear hard upon many working-class families, and will bear particularly hard upon families where the income is small. I am not at the moment thinking of or concerned with the average household, where one or more members of the family may consume beer or stout — call it what you like — to excess. I am thinking of the man who, at the end of his day's work, takes a pint of stout or a bottle or two of stout. If he takes only one pint of stout per day, and there is nothing excessive about that, or a couple of bottles of stout with a friend or fellow-worker at the end of the week, it does impact, taken in conjunction with all the other impositions, fairly severely on that family income.
If you ally that with the additional cost of cigarettes or tobacco, he need not smoke to excess to find a very heavy impact on his income. If he is to continue doing that, it can only be done at the expense of some other requirement in the home. I am informed that there has been a fairly substantial reduction in the amount of drink being consumed. Whether that is so or not, I am not in a position to say. Some people will tell you that there is a big reduction, while others say that they do not notice any change at all. The Minister will have to be more concerned about that than I, but I am concerned to the extent that the average working man, the average man with a small salary or wage or small family income, who drinks very moderately will find this a very heavy impost. I do not think Deputy Cowan can just clear himself of his dilemma and I think he is in a bit of a dilemma.
None whatever.
If the Deputy has satisfied himself that he has completely burned his boats, he is right to stick it out, because there is no possible hope of retracing his step. I know, however, that the Deputy is not feeling in the least happy about it. I know also that Deputy Cowan could make a much more eloquent and a ten times more effective speech against either this section or the next section than I could make and an infinitely more effective and eloquent speech against it than he can make for it.
It may be said that it is not fair to concentrate entirely on the tax on beer on this section, as that is not what the intention of the section is. Deputy Cowan is right in calling attention to the fact that this deals with customs duty on beer, that is, on imported beer, whereas the next section, Section 10, deals with duty on home-brewed beer. But in the Budget speech the Minister put them both together.
I would be prepared to discuss them together.
I know you would.
He said:—
"The present duty on beer is £5 12s. per standard barrel, compared with £5 in the years before the war —an increase of only 12/- on 36 gallons or ½d. a pint. In the light of this fact an increase in the excise duty on beer of £4 1s. per standard barrel is justifiable. It will have the effect of increasing the retail price by 3d. per pint, allowing some margin to the trade."
After a few interruptions, he said:—
"A corresponding increase will, of course, apply to imported beers. From these changes in the beer duty——"
both lumped together—
"I hope to gain an extra £2,400,000 in the present year."
The table explanatory of the Budget shows that figure as £2,360,000. However, the difference is not considerable. First of all, at a time when I was considering these things I was informed that the revenue calculation was that 1d. on the pint brought in £1,250,000 if the Budget were introduced at the usual time, round about the month of May, when a certain period of the year had been lost, but in a full year 1d. on the pint would bring in £1,500,000. We are now dealing with 3d. on the pint—it does not matter whether it is on imported beer or home-brewed beer, as the two are lumped together and we can discuss them together. The point that I wish to talk about is not beer at all but the demand put upon the housewife to find the money for the beer out of the pay packet of her husband, by saving on the necessities of the house, in domestic appliances, in children's clothes or in her own clothes, or in anything else in the household budget. This is the smaller part of it, but the tax is the same.
The first thing to note is the 3d. on the pint in the full year and that the Budget was introduced on the 2nd April, so that the tax became effective from that date. It was a tax that should bring in £4,500,000. The Minister's calculation was that it would bring in £2,400,000. Although he is budgeting on the 2nd April and, therefore, getting a full year, he says it will bring only £2,400,000. That is a significant difference.
It may be explained by an expectation that the consumption of beer will drop off and that therefore there will be only £2.4 million instead of the £4.5 million which would normally be brought in. But, of course, there is another explanation, that is, the explanation we discovered already in the tax on petrol. I have explained already that the calculation which was given to me was that 1d. a gallon on petrol brought in £300,000. Therefore, 5½d. on petrol should bring in £1,650,000. The Minister says he is only calculating for £1.4 million. To my mind, that is an underestimate of £250,000—only there is the extra fact that this year no rebate is being given to the farmers for the petrol they use in agricultural tractors. When I was given the calculation of £300,000 it was on the basis of 1d. put on petrol but with the rebate to the farmers. Now the full whack of the 4d. is being taken this year. I do not know what the calculation was, because I never inquired, but I assume that 1d. on petrol all over the community would yield at least £350,000 instead of £300,000, so that there ought to be brought in from 5½d. £1,925,000, which means an underestimation of nearly £750,000. Again relating that to this tax, are we again in the field of underestimation that we have already explored, where we think the revenue this year is being completely underestimated and the expenditure completely overestimated and no allowance made for any surplus whatever, so that the Minister may have an enormous surplus later that would allow him to go to the people in jubilation and say that they are able to finance the capital programme out of the revenue for the year?
That is one side but here is the second side—and here we must go further afield than beer. I do not mind the difference between imported beer and home-brewed beer. On both the Minister expects to get £2.4 million or a little less, according to Table I explanatory of the Budget. The £2.4 million, as opposed to the £4.5 million, represents a drop of a considerable percentage in the consumption of beer in the country; but notwithstanding that he is going to get £2.4 million from beer. He is also going to get £5,500,000 from tobacco and £1,020,000 from spirits. All those added together come to £8,880,000. There we have the amount that is going to be taken from the people over and above the compensatory benefits alleged to be given under social security—benefits of almost £4,000,000. If those are added together it is the sum of almost £13,000,000. Where is that to be found? The Minister is not trying to prevent people from drinking beer, for if they did that it would completely destroy his Budget.
Again, I want to explain to the House my own experience—and in doing this I am not revealing any secrets, as this should be known to anyone who knows anything about economics. Taxes on beer and tobacco are always described as deflationary taxes. That means that the people who impose those taxes do not expect people to stop consuming either beer or tobacco. They expect that the consumption will go on and that the money must be found for these things. If the money has to be found from the same wage packet as the man used to get before the taxes went on, then the savings must occur elsewhere. To those who felt that the Minister might have been taking any view about an increase in wages, I wish to give what his attitude was, as given in the Official Debate for the 2nd April, 1952, column 1138:—
"The Government are satisfied that as incomes generally have already advanced more than the cost of living..."
There is the background effect of the whole picture, that "incomes have advanced more than the cost of living". It is not possible, the Minister says to himself, to go boldly at the policy of reducing wages, but there is an insidious way of reducing wages, and that is by increasing the cost of, first of all, the things that people must buy and, apart from that, the things that people will buy. The "must buy" things are bread, flour, tea, sugar and butter. If you increase the price of those and wages do not advance, it is the same as reducing wages. If in addition to that you increase the cost of the things which it is your expectation that the people will buy, namely, tobacco, beer and spirits, then you get a further reduction in the value of their wages—at least in the value of their wages as applied to the ordinary necessities of the household. There is nearly £13,000,000 between these food taxes. Deputy Peadar Cowan may want to interrupt again and say there is no food tax. To be precise, it is only a reduction of subsidy. Let him explain that to the working man.
They do understand it.
I understand it, but is not the effect the same?
No.
Not the same? The reduction of subsidy is going to put up the price of flour by 2/1. Is that not the same as putting a tax of 2/1 on flour? Really, are we mincing words?
It is not the same.
I say that on the family budget it produces the same result. A sum of £13,000,000 has to be found by people of whom it is alleged that their wages have already advanced beyond the increase in the cost of living. The whole theme of the Budget was that wages are too high and that as we cannot attack them directly we must attack them indirectly, and that this is the way to do it. They are getting Deputy Cowan to agree with that. He is, therefore, attacking the wages.
I do not say they are too high. I think they are too low.
But the Deputy is reducing them by voting for this section. The Deputy, therefore, does not agree with the pivotal point—I think the Minister described it as the "hard core" in his Budget speech—that incomes have advanced to a higher degree than the advance in the cost of living. Let me quote the Minister's words precisely again for the benefit of the House. I quote from column 1138 of the Official Report of the 2nd April. 1952:
"The Government have given careful thought to this problem over recent months. They are satisfied that, as incomes generally have already advanced more than the cost of living and as essential foodstuffs are no longer scarce, there is now no economic or social justification for a policy of subsidising food for everybody."
Can anybody contradict me when I say that what this Budget aims at is to make the people find £13,000,000 for foodstuffs—bread, flour, butter, tea and sugar—and for the tobacco and the beer and the spirits that the Government expects the people to this extent to consume?
Is it not finding £13,000,000 for extra State expenditure on social services?
Let us say that this extra taxation is necessary although I do not agree that it is. For the sake of argument, however, let us say that it is necessary. The way it has to be found now is to say to the housewife: "Out of whatever money your man brings home each week in his pay packet—and we do not want that increased because we think wages have advanced beyond the increase in the cost of living—you will have to find £3,918,000 for extra cost of food. You will find £8,880,000 for the beer, spirits and tobacco that we expect, if our Budget proposals are correct, your husband to consume"—or maybe the husband and wife between them to consume. There is the point of view. We are not discussing the beer. What we are discussing is an attempt to prevent people from spending money on household goods.
That could be said about any tax, could it not?
It cannot be said about any tax.
Any tax on beer and tobacco.
No. Suppose the Minister were a social reformer and that he came in here and said: "Beer and tobacco are being consumed in extraordinary quantities in this country—more than the country can afford. I am going to put a severe tax on them in order to put the people off drinking and smoking." Suppose he then brought in a Budget and said: "My taxes are so severe that there will be a drop to about one-quarter of the usual consumption of both beer and tobacco which will, henceforth, be consumed, in the main, only by people with big incomes. I am now getting a flow of the tax on only one-quarter of the old consumption." But, in this Budget, there will be a 10 per cent. reduction in the consumption of whiskey and a 6 per cent. reduction in the consumption of beer, according to a calculation made by the licensed trade.
For the rest of it, the expectation of the Government is that beer will be drunk and tobacco will be smoked to the point at which they will yield, between them, an extra £7,860,000, and that whiskey will be drunk to yield an extra £1,020,000. The belief is that all three will be consumed to the point at which they will bring in an extra £8,880,000. If people stopped drinking beer or whiskey to any great extent or stopped smoking to any great exent, the Budget would be ruined.
That could be said of any Budget. That could have happened last year or the year before.
However, the Minister knows that they will continue to consume these things and he is happy about it. He is not saying: "I know you are badly off and that it will be a hardship on your wives and families if you drink and smoke too much." That is not what he says. In his Budget statement he said that incomes have advanced beyond the advance in the cost of living. He says to the people: "You have a bit of money in hand which you are entitled to spend on tobacco and drink. I am going to take it from you, but I am not stopping you from smoking or drinking." The Government are not acting as social reformers and putting people on a Lenten fare of going off drink and smokes. Their outlook is: "Drink as much as you can and smoke as much as you can, and when you do that you will have less to spare for other things."
This year's Budget was divided into three parts. The first part consisted of an economic survey of a general type.
Is this relevant to Section 9?
The Deputy should confine his remarks to Section 9.
I submit that my remarks are relevant. I am explaining what the beer tax means.
The Deputy must keep to the section.
I suggest that what I am saying is to the point, and that every word I utter is relevant. I shall continue my remarks and they will be relevant—notwithstanding the interruption by the Minister in an effort to prevent me from explaining the matter further.
The Deputy should conduct himself like a gentleman, if he can.
This year's Budget is divided into three parts—(1) a general economic survey; (2) the Budget last year; and (3) this year's Budget. The general economic survey was given pride of place, and the conclusion of the general economic survey was: "We cannot afford the present scale of spending abroad in excess of our current external earnings." Does that mean anything other than that the Government are going to make goods from across the land and sea frontiers scarce? Look at those goods in any of the returns of imports and exports for any quarter. What are the goods that come from across the Border and from across the water? To the greatest extent, they are consumer goods— carpets, rugs, curtains, furniture, wash-hand basins, and so forth. They are all things which people want for their houses. That is what we have to stop, and the Budget set out the way to stop it—by taxing food, because people must eat to live. Tax the butter, tea, sugar and flour because the people must get these things, and they will have less money to spend on the things that come from across the frontier. Then you add the tobacco and beer and spirits, which will yield an extra £8,750,000. The Government say they will get that revenue, and that by getting it the public will have £8,750,000 less to spend on the stuff coming from across the frontier. The bankers will be happy, the balance of payments will be rectified, and we shall have the position again that the bankers will be bossing the community. That is the result of the food tax. Do not think that you would be voting against the beer drinkers——
That would be ridiculous.
The Deputy does not, apparently, realise yet that when he is voting for a tax on beer he is voting for the subtraction of £2.4 million from the purses of the people. That £2.4 million is usually spent on curtains, rugs or domestic goods. That is what the Deputy is taxing. He is trying to prevent people from spending money on these goods. That is the object of this tax. Whether it be on imported beer or on home-brewed beer, the principle is the same. The object is to stop spending and equate wages to the level at which the Minister would have kept them.
On one occasion the present Minister for Justice, Deputy G. Boland, lamented the increase in the salaries of civil servants, Army personnel, the Gardaí and the teachers. He said that now local government officials and workers everywhere would expect the same increase in their salaries. Can Deputy Cowan see any difference between a wage policy which will reduce the wages of the community by £13,000,000 and taxing things which the people must buy to keep alive and which they must buy out of the same weekly pay package as before? The Deputy says that he wants wages increased.
I want money for social services.
That is what you are supporting.
I want money for social services.
Paid for out of ——?
Yes; out of beer.
Not at all. Out of sugar. Look at the table explanatory of the Budget.
What about the famous fur-coated lady from Rathmines?
How many fur-coated ladies are there? If you stop the lady in Rathmines buying a fur coat she may start buying more sugar, butter and bread and you will have less for the other people, particularly when the ration goes. But look at the table explanatory of the Budget: Provision for proposals in Social Welfare (Insurance) Bill, 1951, and for other current services, £3,000,000; saving on food subsidies, £6.668 million; compensatory social welfare benefits, £2,750,000. The net saving is £3.918 million. The cost is £3,000,000. They paid for the whole of the social welfare proposals and have £918,000 provided out of the sugar, tea, butter, bread and flour.
None of those things—sugar, bread or butter —arises on Section 9.
They do.
Surely there ought to be some limit put to the insolence of this Deputy?
The only limit would be if I am disorderly. I suggest I am not. I suggest that I have related the whole thing in a well-connected way. There is a principle in the Budget and that was, to stop the gap in the balance of payments, to stop expenditure on consumer goods. How was it done? By taxing food and beer. I cannot consider beer out of the framework of the whole Budget. That is the framework of the Budget.
Deputy McGilligan's statements were rather enlightening. Deputy McGilligan had another way of meeting these matters. There was a guarantee given, before the Deputies opposite succeeded in getting into office, that they would reduce and do away with the increased tax on beer and cigarettes. In order to do that they had to do something which I will describe in this way. Suppose the 31st March was approaching and the rate collector came to me and said; "You have to pay your rates," and I said, "I have not got the money," and he said, "Come to the bank and I will get it for you." I went to the bank; the rate collector secured me for the money; I handed the money to him and I am paying for it since.
The people are paying and will continue to pay for the next 30 years for the cheap pint and the cheap cigarettes that they got from February, 1948, to the end of that financial year. They borrowed the money to pay for it and the people have to repay the principal and interest.
Deputy McGilligan has wandered rather far afield. I want to keep as close as I can to the point. Deputy McGilligan wants to know what the money is for. Deputy McGilligan knows that when he introduced his Budget on 2nd May there was a decision given or, on the point of being given, by the Civil Service Arbitration Board.
It was not given.
He knew that they would come to some arrangement. He made no provision for it in his Budget of last year.
What figure should he provide?
There was £3,600,000 unprovided for in that item alone.
How could he know?
He is not that big a fool. That must be found now. That, Sir, I suggest, would just about cover the tax on beer and whiskey. When we hear of honesty and decency in public life, I would like to allude to another item, which is the cause, I suggest, of our having to pay the increase on beer. The following is a letter dated 3rd February, 1951:—
"A Chara,
In reference to your letter (ref. G. 53/49) of the 26th January, enclosing a copy of the county manager's order No. 46/51 proposing a further increase in the remuneration of superintendent assistance officers and assistance officers by a temporary allowance of 12½ per cent. of their annual salaries, I am directed by the Minister for Social Welfare to inform you that the revision of salaries which took effect from the 1st June, 1948, is regarded as a comprehensive adjustment, and he is not prepared to sanction the proposed further increase."
That was on the 3rd February. On the 7th May this letter was issued:
"A Chara,
I am directed by the Minister for Social Welfare to state that he has had under consideration proposals from local authorities for the payment of a bonus allowance to meet the increased cost of living to superintendent assistance officers and assistance officers. I am to state that he approves of the proposal to increase, as from a date not earlier than the 1st November, 1950, the salaries of these officers by 12½ per cent. Where a proposal for an increase has not already been submitted by a public assistance authority, the Minister will be prepared to consider favourably a proposal on the foregoing basis."
How is this related to the duty on beer?
Portion of this money for health services had to be found in this Budget. That is how it comes into this. Here is the Minister, who informed officials on the 3rd February, 1951, that they were not entitled to anything, saying, four days after the Dáil dissolved, that they were entitled to it; that not alone were they entitled to it in May, but were entitled to it for four months prior to February, from November, 1950. That is the money we have to find now. This is honesty in public life. This is the purchase price of the seats of some of the Deputies over there. The people who have to visit the poorest of our people who are living on home assisance, a week before the election took place, had inside in their pockets six months' increase in back pay and a guarantee of an increased salary. They went around to the poorest of our people on whose behalf Deputy McGilligan is bewailing the price of bread, butter and the pint. That is how this game is worked. That is why we have a bill to pay. That is why the people now have to be asked to pay it. Corruption in its filthiest form.
Another of these letters was issued from the Department of Local Government on the 4th May. Two issued from Deputy Costello, one on the 7th May and another on the 17th. Between the three of them they account for £855,000 in this Budget. That has to be found. Will Deputy McGilligan have the neck to defend that? I am glad I have got him where I can look at him. I am delighted to look over at the gentleman who, on the 2nd May, brought in a Budget and who apparently did not know that the Dáil would be dissolved on 3rd May and that on the 4th May the boys would send down the bribe.
Let us count it up. There was £3,600,000 for the Civil Service; there was £855,000 in those couple of letters, plus the £2,000,000 that the ratepayers had to pay in addition—the poor people for whom Deputy McGilligan has been fighting for the last hour. These are the poor people, on whom 1/8 in the £ was put in order to pay the purchase price for a couple of seats here, and that is why the price of beer has had to be increased.
We have another little item. He told Córas Iompair Éireann last year, when he was introducing his Budget: "You will have to live in future on your own resources and get revenue to meet your expenditure." He provided nothing for them in the Budget, although he knew that a sum of £980,000 had to be provided for Córas Iompair Éireann in the Vote on Account for that year. As a matter of fact, a total of £1,800,000 had to be provided for that purpose last year, Add all these figures up and see where you are going to find the money for these purposes. The payment for the three years' little spree that the Deputies opposite had on borrowed money will cost the people of this country £6,000,000 extra in interest and sinking fund on that borrowed money.
That statement can be confirmed from the records of this House in which there will be found a reply which I got from the Minister for Finance nearly two months ago. Neither Deputy McGilligan nor any other Deputy had the neck to challenge that statement since. It is down there in black and white. If the statement were wrong, surely Deputies opposite would get up and deny it. We have, therefore, to provide an extra £6,000,000 a year for interest and sinking fund on borrowed money over what had to be provided in 1947-48. Add that to the other three items I mentioned and ask yourselves where is the money to be found.
Let us get down to this and examine it in the same way as any householder would examine his own accounts. I admit that the gentlemen who had the neck to borrow in order to reduce the price of the pint in 1948 would have the neck to borrow to maintain the food subsidies this year or next year, if they could get anyone from whom they could borrow, but if you have to go to a bank manager as these gentlemen had to go to the money-lenders, and tell him that you wanted £5,004,500 in 1947-48, £9,800,000 in 1948-49, £20,480,000 in 1949-50, £21,000,000 odd in 1950-51, and £38,980,000 in 1951-52, you would not get very much money advanced to you. That was the cost of the spree— £98,980,919—and that is what the people of this country will have to pay for the next 30 years. No doubt you had a good time. You had a royal time while it lasted, but no attempt was made to provide for an increase in industry.
To get closer to the question of the tax on beer, according to the chairman of the Licensed Vintners' Association there was an increase in consumption of 36,000 barrels last year. I do not know who swallowed it.
It must have been in Cork.
I can tell Deputy O'Leary that the account I have got from the publicans in Cork is that there is as much of it being swallowed as ever and that there is no reduction in consumption.
Whom are you codding?
As a matter of fact some of them told me their consumption increased, because they had got some extra customers.
A Deputy
Fianna Fáil publicans.
They are Fianna Fáil publicans. I was given a description of how the Fine Gael publican acted when he started to fill a pint. He would say to his customer: "This extra price has ruined us. This last bit of a rise has finished us. Here you are, Mickey," and he would hand out a pint with about two inches of froth on the top of it. Let me say that the majority of the people of this country do not drink for the sake of drinking. The majority of the people go into a public-house in the evening to have a social chat, perhaps a drink with their neighbours and a game of cards or a game of rings. When they go into some of these public-houses, they hear a lot of moaning and groaning: "My God, Mickey, it has gone up. It is 1/2 a pint now." Then the publican hands out the pint with two inches of froth on the top of it. The lad who sees that, goes into the Fianna Fáil pub the next night where he gets the full pint. I am only relating the facts of the situation as I know them, as they have been given to me by reputable publicans in my constituency. They have given me that description as an explanation of the reason why extra customers are coming in to them. I can tell you that some publicans down there have lost customers because of their conduct in trying to condemn the Budget, at the behest of the Fine Gael organiser in the district, and they are not too thankful to the Fine Gael organiser because of the loss of these customers. As I say, there was a pretty hefty increase in consumption. There were 34,000 extra gallons of whiskey drunk last year. I am not making any wild statements. I am repeating the statement made by the chairman of the Licensed Vintners' Association and published in the public Press last March.
It must have been the Yanks drank it.
I do not care who swallowed it. It was swallowed anyway.
I am sure Deputy McGilligan was very glad to get the extra duty on the extra consumption to help him to pay for some of the things he forgot to provide for. It gave him a little help in that way. Deputies talk about honesty in public life and then issue documents like the letters which I have read here. I am not saying that they were not entitled to it, but if they were entitled to it in May they were entitled to it in February. If they were not entitled to in February, then why pay them back to November, 1950?
This speech is worth a quorum.
Notice taken that 20 Deputies were not present; House counted and 20 Deputies being present,
When I was so rudely interrupted I was asking——
On a point of order. Is pointing out the absence of a quorum in the House a rude interruption?
What else is it?
Is the Deputy entitled to refer to it in that way?
Deputy Collins had a little experience in that line. I say that the Minister's difficulty 12 months ago and the Minister's difficulty to-day are two very different matters. We all know how long it takes an auditor sent down the country by the Local Government Department to go into accounts. It must have been a terrific job to go into these accounts and find out what was unprovided for, what Deputy McGilligan quite forgot. I am sure Deputy McGilligan is honest and that he thought these civil servants were entitled to nothing at all.
The Minister for Justice said they were.
I am saying that Deputy McGiligan must have been absolutely certain that they were entitled to nothing.
We are not discussing that to-night.
We are discussing why we have here a request for an increased duty on beer and I am giving the reason. It is undoubtedly due to what practically amounted to corrupt practices by the previous Government. It would have been a fine thing if Deputy McGilligan had done what he is accusing the Minister for Finance of doing now, namely, making overprovision. If there had been overprovision, there would have been no necessity to borrow £94,000,000 in three and a half years.
This is the first time the Party room secret was let out.
If the Deputy can read, and I am sure his education went that far, he should read the reply to a question asked by me in this House last month and he will find that exact figure given.
That you are going to get more than you want?
I asked a definite question and I got a definite reply. I had a certain amount of sympathy for Deputy Rooney when he saw the bricks being thrown into the tomato houses every night by Deputy Dillon.
The Deputy is getting away from the section.
I am keeping more closely to it than Deputy McGilligan in his speech. The Minister for Finance has to find this money now. I can take the question of beer back to the period when agricultural labourer's wages were around 26/- a week and the price of the pint was 9d. If Deputies have the idea that every other thing must go up, but that there must be no increase in the price of drink, let them put that into practice. I certainly consider that the price of drink must go up the same as the price of boots, clothing and anything else, particularly when it has to go up in order to meet increases in the salaries of civil servants. Some 4,730 extra civil servants were brought in after the emergency. I could understand an increase in the number of civil servants during the emergency, but 4,730 were brought in after the emergency during the three and a half years of the previous Government. I had no intention of speaking on this matter at all, but when I saw the barefaced attitude taken up by the Deputy who was responsible for this situation when he was Minister I thought something should be said about it.
The comment has frequently been made in regard to Irish history that there were two distinct classes of folk who did a little bit of oppression upon their own in this country. There was one class that came in from outside—the Planter crowd with a little bit of breeding behind them. They looked down on the people in the country as low, common people. They bred a class who worked under them as their agents and who were recruited from amongst the common people of the country, and Irish history has always pointed out the fact that the agent recruited from the common people was much worse towards his own than was the Planter, the man of breeding who came in from outside.
Those who think that this Budget means a wages policy will surely have learned a lesson from the vulgar, ignorant diatribe of Deputy Corry this evening, a man raised a little bit above the rest of the people who sees red because a local authority employee gets an increase in his salary and the gentlemen from Dublin—the auditors from the Department of Local Government—get an increase in their salaries and will, perhaps, as a result of that, get a better pension when they retire. The man who raises himself even one step above the ordinary people here is always harsher on what he regards as the lower classes than the invader ever was with his old family background and breeding.
What is Deputy Corry always grousing about? He is grousing because people got an increase in their wages and salaries in our time. I am glad they got that increase. Then the Deputy in his ignorance follows up his grouse by saying that we borrowed to pay these increases. We never borrowed a single penny to pay a civil servant or a local government employee. Neither did we force anybody else to borrow for that purpose. The Deputy started to say that I knew before I budgeted last year what the Civil Service Arbitration Report was. He then corrected himself because the date was given to him in such a way that even his benumbed head could not fail to understand the position. The report was published on the 24th May. I budgeted on the 2nd. Yet I am supposed to have known what the arbitration report was on that date.
Apparently you thought they would give nothing.
Why?
Because you did not make any provision.
What would I provide?
You could put in £1,000,000 or £2,000,000.
Would anybody but a congenital idiot enter into negotiation and arbitration revealing what he thought the people against him should get and then let them make their claim on that? Evidently that is the Deputy's idea of negotiation. I left plenty of money behind me to pay the civil servants. The increased revenue last year brought in £3,000,000. That one item brought in enough to pay not merely the civil servants, but the Army, the Gardaí and the teachers as well. Not one penny piece was required beyond that increase in revenue from the lower taxes that we imposed in our time. Those lower taxes paid the whole lot. It may not have paid the arrears but there was £2,000,000 in the kitty for that type of reserve against that sort of emergeny and the odd £600,000 could have been paid out of that for the civil servants, the teachers, the Gardaí and the Army. Not one penny piece of taxation was required. I realise now, though I did not realise at one time, that that is so much a part of Fianna Fáil policy. I did not realise it until Deputy Boland, now Minister for Justice, spoke in relation to the matter and lamented that the increase in Civil Service salaries would cost about £700,000. That was the earlier increase. Do not let Deputy Corry forget that when he gets mad and raves and shows his ignorance over increased emoluments given to people who deserve them.
Are we discussing the Civil Service now?
The whole thing was discussed. The Deputy raised it at some length and surely I am entitled to reply at equal length. Deputy Corry brought this into the debate. I want to reply but I will not take as long as he did.
On a point of explanation, what I dealt with here was the non-provision of moneys——
That is not a point of explanation and the Deputy cannot repeat his speech.
——and the corruption of the Deputy opposite when he was a Minister.
Deputy Corry will please sit down.
The pivot of the Deputy's evocativeness and the burden of his complaint now is that money has to be found for the increases in Civil Service and other salaries last year. The burden of Deputy Boland's complaint at that time was that the increase in Civil Service salaries would cost £700,000 in one year. He lamented that the total cost of the increases in relation to the Army, the Guards and the teachers had not yet been exposed at that time. Deputy Boland was making the people apprehensive. He warned that the total cost was not exposed. He said that local government officials would naturally expect increases. Of course, Deputy Corry would not agree with that.
Deputy Corry gave it to them. Deputy Norton refused to pay that. There is the proof.
Sit down. You got your chance.
You paid a lot for your vulgarity. Many a college you had to go through in order to learn it. I believe you were very thick, too. It took a lot to make it sink in.
Deputy Corry will have to restrain himself and allow Deputy McGilligan to make his speech without interruption.
I do not know why I should have to take this even from an educated blackguard.
The Deputy will withdraw the expression "blackguard" in relation to another Deputy in this House.
I withdraw it. You all know what I think.
What exactly did the Deputy withdraw?
The Deputy withdrew the expression "blackguard".
The Deputy withdrew the word "blackguard," at the same time saying in the distinct hearing of Deputies: "You all know what I think."
The Deputy withdrew the expression "blackguard" in relation to Deputy McGilligan.
In a way I am sorry he withdrew, because, coming from Deputy Corry, it might almost be regarded as a compliment. Deputy Boland, now Minister for Justice, was apprehensive that local government officials would naturally expect increases also. All these "blighters" would expect increases. There was the picture. That was the situation Fianna Fáil were determined to avoid. Does Deputy Captain Cowan think he is in good company in looking for a wages policy wherein wages will increase in accordance with increases in the cost of living when he associates himself with Deputy Corry?
Senator McGuire let the cat out of the bag yesterday evening.
Let us have something on the Finance Bill now.
That was the situation Fianna Fáil were determined to prevent. That was the situation they would have prevented. Deputy Corry sees red and becomes almost hysterical because people got increases. Civil servants got a generous award from an independent arbitrator. It was a heavy bill for the people who have to pay, but do not forget that the Statistics Department has provided a chart and that chart shows the increase in the cost of living over the war years when Deputy Corry, through his Government, helped to keep wages pinned at a certain point through the medium of a standstill Order.
That statement is untrue and the Deputy knows that.
Of course it is true.
The statement is perfectly true. It was Order 86. We can never forget that.
The statement is untrue.
I have asked Deputy Corry to restrain himself.
Deputy Corry should ask the Minister for Posts and Telegraphs. We can never forget Order 86.
The chart shows that wages stood still. There is a line showing the cost of living and in between there is a big balloon-shaped space. That space represents the area that was not filled by an increase in wages to meet the increase in the cost of living. It represents that so much money was subtracted over the war years from the pockets of the industrial and agricultural workers in this country through the operation of the standstill Order while the cost of living was allowed to soar sky-high.
The civil servants are, so to speak, in that chart. They were hit earlier than the ordinary employee. Their salaries were subject to a standstill earlier than people in outside employment because they were under the thumb of the Government and could be better managed. The balloon had to swing wider still with regard to what was taken out of their lives. When the arbitration award came, it was not to make up in one go what they had lost but just what had to be given to them to meet what was required in opposition to the increase in the cost of living in relation to their salaries. That is what happened. The award was a just award. I am told that I made no provision for it. There were bundles of money to meet all Civil Service awards and all other awards, and on the economy side there was enough to pay all back-dating of that.
Deputy Corry has shown his hand to-night, and he speaks for the Party. He is against wage increases, and that is why he so easily swallows this document. He kept clearly away from what I had spoken of. He says that I spoke irrelevantly. At least, I spoke relevantly on this point that the whole idea of the Budget is to stop imports coming into the country. How can you do that? Stop people having the means to buy. You can meet that in two ways. Decrease their wages. Even the barbarity of Deputy Corry could not get the Party up to that line. The next thing is effectively decrease wages by increasing the cost of what people have to buy. They must buy food. Increase that cost by £3,918,000. Let us think of something else. They still smoke, they still drink a pint and take an odd half glass of whiskey. Very good, we will take £8,880,000; and all that is going to be found out of pay packets which are small enough as it is. Deputy Corry would like to have them smaller. He is mad at the increases that were given. The Minister says they are not to go up because they have already gone beyond the cost of living. That is the kernel of the Budget. That is why we are trying to get £2.4 million out of beer; not to stop people drinking beer, but in the hope that they will go on drinking, and so that their wives will not be able to buy furniture or clothes, and that there will be no imports across the Border. The bankers will be in great jollification. The Minister for Finance will stand as a hero with the bankers, and the bankers will still refuse to invest the money of the people in this country.
In view of the statement made by Deputy McGilligan I should like to say a few words. Deputy McGilligan is a lawyer, and when he has no case he bolsters up one with abuse. He has stated that I got red hot at the idea of an increase in wages being paid. The letters I read——
I cannot allow this unless it is related to the section. Deputy McGilligan said he was replying to what Deputy Corry had said. Therefore, the thing is cancelled out, unless Deputy Corry can relate what he has to say to the section.
I will relate it to the section. The first letter I read, the letter of 3rd February, 1951, related to the increase in salaries given by the board of which I was chairman. The increases were unanimously given to those people and refused by the then Minister for Social Welfare, Deputy Norton. The second letter related to the giving of that increase four days after the Dáil was dissolved to purchase votes to get that gang in here.
I merely want to say that we should be grateful to Deputy McGilligan for his clear and unequivocal statement that Fine Gael regards itself as the new ascendancy or plantation class.
It is very hard to hear the Deputy. Would he repeat that?
I said that we should be very grateful to Deputy McGilligan for the clear and unequivocal statement that Fine Gael regard themselves as the new ascendancy or plantation class.
You are hard of hearing, boy.
A representative of that class is keeping the Government in office.
(Interruptions.)
Question put and declared carried.
SECTION 10.
Question proposed: "That Section 10 stand part of the Bill."
This is the section which was described by Deputy Corry in his extraordinary cerebral gymnastic effort as causing a stimulus and an increase in the licensed trade.
The Deputy is living up to what he promised—bigger and longer words.
You will not be much longer in this House. The Minister, with his extraordinary capacity for cerebral gymnastics, did not rise to explain the speech he made in the context that the issue was honesty in public life, that the issue was politicians who make false promises. In that context the Minister for Finance —then Deputy irresponsible MacEntee —was making the statement that people were making mendacious statements and whispering that if Fianna Fáil were returned to power they would hit the poor man's pint and tobacco. That was a foul slander according to him—something that was not going to happen. He then gave his classic assurance, in the context of honesty in public life, that there would be no increase in beer and tobacco. I want to say to the Minister that the impost in this section is going to be felt hardest by the poorer sections of the community. I do not think that, in honesty, the Minister any more than Deputy Cowan, could deny to the heavy type of manual worker the right to a certain amount of relaxation, whether he works at the docks or on the land, of having a pint of beer or a pint of stout after a hard day's work. I think that the impost he is being asked to bear here is an unfair one. I have felt, and I have said it when dealing with this Bill before, that if these taxes had to be raised there should surely have been a more equitable way of finding them than by putting this tremendous impost where it will ultimately fall—on the poorer sections of the community. But I feel that there is no need for these taxes.
I say to the Minister that, if he had exercised a little judgment and shown a little sanity when dealing with the buoyancy in the yield from this particular tax, he could have made a more equitable distribution and still have got, if he wished it, a reasonable amount of increased revenue. I am opposed to asking the poor man, as this Budget does, to carry an inequitable share of the burden. In my view, there are sources from which the Minister could have extracted the money without resorting to this particular type of penal imposition, which I consider to be a hardship on the working-class of this country. This is a particularly obnoxious tax, considering the appeal made by the Minister and by the Government in general for greater effort and for greater production. We have problems enough in this country without seriously increasing them by this ill-judged and illconsidered taxation of the simplest types and of the more generally used types of beverage. We hear moans about the denuding of rural Ireland. Will the Minister tell me, when replying, where is the incentive to greater production and greater effort in rural Ireland in this cruel type of assault on the simple luxury-cum-necessity of the people working in those areas? Is there any incentive when you regard the problem in its reality? Deputy McGilligan put it quite clearly; the till is no bigger; there will be no addition in the wages of the man; there will be the same wage packet.
I think there will be an increase.
It is not very apparent at the moment, but, please God, there will be.
It is not intended that there should be.
The policy underlined, crystallised and substantiated in the long economic diatribe given by the Minister for Finance showed that the Government, after careful consideration, considered that the rise in wages had outstripped the rise in the cost of living.
That is a fact.
That is about the plainest statement one could have on mid-Victorian economics. Decking himself in the voluminous petticoats and skirts of the early Victorian maiden, the Minister for Finance comes into this House with this economic theory and with the crystallised principle that wages are high enough; that the Government have considered that; that they are satisfied that, out of the same pay packet, they can ask the man, first of all, to work harder and produce more and, secondly, that they can ask the housewife to pay more for essentials. The larder is being effectively, cruelly and unjustifiably raided. At the same time, the Government are, in the main, going to ask the same people to carry the burden by giving to the Exchequer approximately £2.4 million as a result of this additional impost. It means at least this: the person who is being asked for greater effort by way of national production is going to eat more and to drink less. The position at the present time is that most of them can eat only barely enough, and that very few of them can afford to drink too much. Such is the situation that will arise under this Bill.
I am asking again what has altered the position as to the net estimated yield of 1d. on the pint? Is the estimated yield of 1d. on the pint the same for the full year— £1,500,000? If it is, how can the Minister justify this increase? If he is only budgeting for £2.4 million, how can he justify an increase to the extent which he now seeks? I want the Minister to explain to us if the theory of his Government is further crystallised in this savage imposition—the theory that the Irish people are living too well, eating too much and drinking too much? Is this a further indication of the fact that Fianna Fáil, as a Government, resent laughing faces and smiling eyes throughout this country? Is this another pushed-out tentacle of their autocracy shown by putting their hands into the pockets of the people lest they should earn the right, as they should earn it, to enjoy any little extra luxury if they feel like it? One of the principal luxuries, or avenues of enjoyments for the working man of this country is the local public-house, a bottle of stout and a pint of beer. This Budget has been cruelly designed to impose constantly in every direction on the poorer sections of the community, in the main. Is there something wrong about giving the working man of this country and his wife, if she feels like it, the right to drink a little beer or stout and to obtain it at a reasonable price? I say to the Minister that if the framework of his Budget is to get increased taxation and still keep up consumption, he is cutting off his nose to spite his face.
It would be infinitely better for him to reconsider the effect of this tax. I feel that, if he reconsidered the matter and left the pint and the bottle of stout within the capacity of the working man and his wife, if she likes to drink a bottle of stout, the buoyancy of the yield from it might compensate him far better than this savage imposition. We are entitled to ask, on this question, what is the Government's general tendency on the economic view of this country? Is this part of a forced devaluation? Is it part of the game to dissipate and to detract from the work done by their predecessors? Is it their policy to convert an expanding country ready to expand further into the bewildered and contracted state which operates in credit and in business to-day?
To some extent, the discussion on the last section and on the present section, so far, reminds me of beer that is too high. There is a tremendous lot of froth being poured out. Deputy Collins made two contributions on this section. Having spoken in error on Section 9, he again makes, on Section 10, the point, which he adopted in his second attempt from Deputy McGilligan, that the worker has got to pay this increase from the same pay packet. That was Deputy McGilligan's point, that he had to make provision for the reduction in the food subsidies and make provision for this extra taxation out of the same pay packet. Both Deputies forgot that the situation has altered. It has altered as far as the old age pensioner is concerned.
1/6.
It has altered as far as the widow and the orphan are concerned. It has altered as far as the father and mother of a family with four children are concerned. Under the new arrangement, where there are four children in a family they will receive 10/6 instead of 5/- children's allowances.
How many bottles of stout will you get for the 10/6?
I am dealing with this matter of the pay packet and the case that is being made, and I want to deal with that. Under the Social Welfare Bill which we had in this House recently there is provision for increases in the amounts to be paid to the unemployed all over the country and there are provisions for other increases as well.
I read the papers and I see that there are some negotiations whereby one of the congresses of Irish unions and the Federation of Employers are discussing a 12/6 a week rise. That is in the papers every day. It appears that something is agreed. Apparently the Trades Union Congress think it is not enough but there is to be an increase in wages in the near future. I am dealing with a matter of fact. I am dealing with an argument which Deputy Dunne did not listen to.
There is not any such agreement that there will be a definite increase.
Apparently there is some agreement in regard to 12/6 a week and the Trades Union Congress think that is not enough. I have said in interruptions, and I have said it specifically when speaking on the Budget, that I believe our wages are deplorably low and that it is the duty of the Trades Union Congress and the Congress of Irish Unions to see that wages are increased. That is their duty. That is their function. I think Deputy Davin would agree with me that it is their function to get an increase if they can.
It is a function of indi vidual unions.
It is a function of the trade union movement. It is their duty and their job to get those increases in wages. Let us not forget the significant fact that we were discussing, only a year ago, a Social Welfare Bill introduced by Deputy Norton which, had it passed into law, would have necessitated increases in taxation. There is no doubt about that.
It would have been in operation from the 1st of January of this year only for people like you.
Deputy Davin ought at least to keep himself informed. I went to the trouble this evening of going up and reading the transcript of the speech delivered in the Seanad yesterday by Senator McGuire, who boasted deliberately that the Fine Gael section had delayed the passage into law of the Social Welfare Bill.
That is not so. That is completely untrue.
To discuss here statements made in the other House is quite unusual.
I have read the transcript.
Mr. O'Higgins
No Deputy in the House knows it better than the Deputy who is speaking.
We must not discuss discussions that took place in the other House.
I am not discussing them, Sir. I am drawing Deputy Davin's attention to the fact that he ought to keep himself informed.
He purported, Sir, to quote what Senator McGuire said in the Seanad yesterday.
I did not.
The relevant document, the Official Report, is not yet available.
Deputy Davin knows very well that I did not quote.
The Deputy said he read the transcript.
Of course, I did. I read it especially because I was very much interested in it. Deputy Davin ought to be as interested as I was. If he were, he should have gone and read it. If they went up and read what Senator Baxter said——
I have warned the Deputy that we cannot discuss what was said in the other House. It is hard enough to look after ourselves.
Deputy Davin finds himself in a great difficulty, and he will find himself in still greater difficulty down in Laois-Offaly when we have a general election.
I do not mind meeting you anywhere.
Why delay it?
That was MacGinty's forecast before—if you come down the next time.
Deputies will have to allow Deputy Cowan to make his statement without interruptions and Deputy Cowan will have to deal with Section 10.
He is looking for interruptions.
Deputy O'Leary should not oblige him then
I propose to deal with the points that were mentioned by Deputy Collins in opposing.
I hope you will admit I was relevant this time.
I sincerely trust the Deputy was relevant so that I will be relevant also. I have dealt with this question of the pay packet. Deputy Davin has disappeared. I do not say he is running away at all, but I would have liked to deal a little more fully with the situation, as I visualise it, in his own constituency in the next election.
Deputy McGilligan and Deputy Collins were perfectly wrong when they said that these taxes have to be paid out of the same wage packet. That is wrong. There had to be this new Social Welfare Bill. There had to be those increased allowances. We were promised that we would have those increased allowances. In order to make provision for those increased allowances and for increases in wages in different Government services and because of an increase in Government administration, there had to be some new taxation. The Government decided—it is the responsibility of a Government so to decide—to put this increase on the price of beer, this tax on beer, brewed in Ireland. I think it is, in fact, the beer that really was under discussion in the last section and that we should be discussing now. If this tax was not imposed where was this £2.4 million to come from?
Increase the revenue.
Apparently the suggestion is that people should drink more.
And eat less.
That is the suggestion, drink more, and eat less. I do not think that that is being put forward seriously as an argument that the Government should encourage people to drink more. I do not think anyone puts that forward seriously as an argument. Consequently this 3d. per pint taxation has been put on. I had an interview with a number of publicans in regard to this taxation.
There are some of them in the House. They would like to hear your views.
They were representative of publicans in Dublin anyway, and I think representative of publicans in quite a number of parts of the country.
Mr. O'Higgins
The Deputy was to put down an amendment.
He promised.
He did not promise to put down an amendment, but it is very funny that the draft of the report of the interview which was submitted to me contained that, which I deliberately deleted because it was not true. I did not promise to put down an amendment. I do not know whether I could have.
Mr. O'Higgins
Quite easily.
I probably could have play-acted, put down an amendment to have it on the Order Paper and have it ruled out of order.
Mr. O'Higgins
An amendment to delete a tax?
Even Deputy Collins did not put that down.
You are entitled to put down an amendment to reduce a tax. There is no doubt about that.
I do not agree——
You seem to think there is some difficulty about it. There would be none. You are quite clear on that?
When I was discussing the matter I made it clear that I stood by the Budget in toto.
Lock, stock and barrel.
You promised them nothing?
The matter was reported that I interviewed them. At the end of the interview there were general expressions of appreciation dealing with my honest approach to them.
You need not repeat those.
I told them that, as far as I was concerned, I would not move for any reduction in this tax, but I did say that I would ask the Minister to meet the publicans to the extent of removing objections in regard to licensing laws at the moment and also in regard to profits. They agreed that it was the duty of the Government to tax. They agreed that as far as they were concerned—and I think they were perfectly right in putting this proposition—they were anxious about their own profits.
I think it was a very fair way to put their case. What they were afraid of was that this Budget might interfere with their own profits. They believed that the margin of profit which they would have under the Budget was not as great as the margin of profit they had prior to the Budget.
Did any of them state they were afraid they would have to reduce their staffs?
I would like to make my own case. I cannot deal with everything.
You promised to oppose the Finance Bill.
Were you there? I do not know whether Deputy Rooney is deliberately acting the fool or deliberately appearing to be childish. I am giving an account of an interview I had with a number of publicans representing many political Parties.
They were very optimistic——
Deputy Rooney should restrain himself. He is continually interrupting.
I put it to that deputation that I would ask the Minister to examine the case they made in regard to their margin of profit, and I think it was a fair request to make. I am making that request to the Minister that he would examine the position. I did say to these gentlemen then that I thought their correct approach was through their own organisation making their case to the Minister, and if they met as an organisation and not as a group of politicians they would probably benefit from their meeting. That was the case I made to them, and I think it was reasonable.
You would want to get Miss Kathleen Morris on the job.
I do not know who the lady referred to is nor anything about her.
The secretary of the Dance Hall Proprietors' Association.
The publicans, as I say, have a grievance in regard to that, but their main grievance is this, not the tax but will that tax affect their profits?
And the value of their property.
Yes, obviously, because the value of their property to a large extent is based on their profits. I suggested to them that when this Finance Bill came before the Dáil I would make an appeal to the Minister to consider carefully their representations in regard to this matter. There was a couple of other matters, and it would help considerably if the Minister were to consider them. One in Dublin is this broken hour, from 2.30 p.m. to 3.30 p.m.
How is that related to beer excise duties?
One red herring is as good as another.
This is the Deputy who gave me a lecture on relevancy.
It is not a red herring at all.
It is beer we are discussing, not red herrings. Excise duties.
I am putting it to the Minister that he would increase his revenue from beer and might subsequently be in a position to reduce the tax if he abolished this one hour closing in the middle of the day.
That is too tenuous altogether. It will not hold any strain. The Deputy will come to the section.
It was a right good effort, Peadar, all the same.
These are the matters the publicans are concerned about. Undoubtedly if the differences and the anomalies that exist between publicans in the city and publicans in the country were dealt with, it would substantially help.
Is the Deputy trying to give the Bishops another slap in the mouth?
You got a slap in the mouth to-day. Read the Mail.
I am asking the Minister to meet representatives of the licensed trade to discuss this matter of their margin of profits, the anomalies that exist and the grievance they have in regard to the operation of the laws in regard to their licences. I think that if the Minister does that it may be possible to meet the reasonable case that can be made by representatives of the licensed trade. Apparently, if one is to do that, if one is to meet what are considered to be the just grievances of the publicans who are a section of the community it would offend Deputy Flanagan.
That is not Section 10.
Deputy Flanagan can defend himself, and I hope I will get an opportunity of doing so very shortly.
I would suggest to Deputy Flanagan that he should consult this evening's Mail.
I have done so
He will see a repudiation by his own Party.
If you think that a thing like that worries me——
Would Deputy Flanagan restrain himself? Whatever is in the Evening Mail about Deputy Flanagan I do not know, but I do know that it has no relevance to this.
There used to be a lot in the Evening Mail about Deputy Cowan and Deputy Seán MacEntee.
Those were the days gone by.
I would recommend to the Ceann Comhairle when he has left the Chair a study of the letter column in the Evening Mail.
It would be nothing to the letters you got from your constituents.
I would suggest to Deputy Cowan a discussion of Section 10.
I am doing my very best——
Not to.
——to discuss it in accordance with what has gone before. I thoroughly agree—and I think I may repeat it for the benefit of my friends in the Labour Party who may yet find their soul——
You have no friends in our Party.
I am sure that Deputy Cowan is troubled about our soul.
Deputy Hickey's political soul.
I am sure you are very worried indeed about it.
I am concerned with the Labour political soul. I was wrong in saying that I was concerned about Deputy Hickey's.
Mr. O'Higgins
You are concerned about the Fianna Fáil political soul.
He is more concerned about Deputy Cowan's political soul.
The only soul he has is the sole of his boot.
Unfortunately, as Deputy Hickey would probably agree, there is a very big difference between the political soul of Labour——
There is a very big difference between what Deputy Cowan is discussing and what is in the section, and I am asking him now to come to the section. I will not repeat that again.
Deputy Collins, in opening, referred to the pay packet, the income packet, of the average family which is being substantially increased by the recent social welfare legislation and by Acts which have gone through this House. I sincerely hope that efforts will be continued by the whole trade union movement to increase the wages of all workers so that the restrictions and taxes we have in this Budget and in subsequent Budgets can be met from wages. The whole trouble, the whole point put forward by Deputy Collins and by Deputy McGilligan prior to that on Section 9, when in fact he was discussing Section 10, was that our present rate of wages would be a reasonable standard without those taxes on beers and tobacco——
And if the raid on the food larder did not take place. At least be honest.
This House has dealt with the question of the food subsidies. There is provision in the social legislation which we have passed and which will be in operation next month to meet, and more than meet, the lack of the food subsidies.
You do not believe a word of it.
What about the increase in the price of butter to the people who voted for you?
Will Deputy O'Leary please allow Deputy Cowan to make his statement?
Deputy O'Leary refers to the price of butter.
It does not arise on this section.
No, except that in the discussion on it so far the food subsidies have been discussed.
Mentioned, not discussed.
They were scarcely mentioned in my hearing since I came into this Chair.
They have been mentioned on Section 10 and were discussed at great length on Section 9.
There has been no discussion of the food subsidies since I came into this Chair except a passing reference now and again.
Deputy McGilligan made the point which was accepted by the Chair that these two sections could be discussed together and, examining the matter in a broad, general way, one must take into account the removal of the food subsidies.
The Deputy will not get away with a discussion on the food subsidies. I am asking him for the last time to discuss Section 10.
Anyway I am very near the end of what I have to say on Section 10.
You have not said anything yet.
I want to make those two points. I want to make the case to the Minister that the grievances, which the representatives of the licensed trade feel they have, should be examined, and I think that that request should be supported by every Deputy in this House. I think it is reasonable for the licensed trade to ask that they should be met and that the point they put forward regarding the margin of profit should be taken into account. That point, as Deputy Morrissey says, does affect their profits and the value of their licensed premises. I am not one of those people who condemn publicans just because they are publicans. I think that publicans render a great social service to the community. I agree with Deputy Collins when he said that they do provide places of entertainment, places where people in the country and in the cities can go and sit down in comfort to enjoy a drink or two in a congenial atmosphere.
I know that during the last ten years or so publicans, particularly in Dublin, and generally speaking throughout the country, have spent a considerable amount of money on improving their premises and providing all the amenities necessary, not only for our own people but for visitors and tourists. Any reasonable proposition they put up should be sympathetically examined by the Minister, and I am asking him to do that. I think I can say that that is strictly within the ambit of Section 10.
The words deflation and inflation have been often bandied about the House in connection with this question. But I think I have never seen a better example of deflation than Deputy Peadar Cowan during the past two or three months. As I listened to him here during the last ten minutes, my mind reverted to a comment in one of P.G. Wodehouse's novels on the embarrassing spectacle of a man who in a waiting room consented to hold a baby for a strange woman. That was about 4.15 p.m. He looked at the clock at 6.30, and found that there was no relief, and as his train was going at that hour he wondered if he had done right or whether he would miss the train on which he intended to travel. The Deputy is holding a lot of babies, cheap tea, sugar, bread and butter. We sometimes get more vocal and say beer and tobacco, but the Deputy is more concerned about missing the train than about the embarrassing load he has to carry. I do not think he will find himself in good company if he runs and finds that he still has to hold all the embarrassments he has taken on in the course of this debate. He talks about a wages policy. The whole Budget is a negation of a wages policy. The principle and background of the Budget is anti-wages, and the Minister so stated.
On a point of order, is Deputy McGilligan in order in discussing the whole Budget policy on this section? The Ceann Comhairle has already ruled that Deputy Cowan could not discuss the reduction in food subsidies, but should confine himself narrowly to Section 10.
Deputy McGilligan is entitled to discuss the excise duties on beer on this section, but he is not entitled to discuss the whole effects of the Budget policy.
I do not intend to, but I intend to give the preamble to it.
The Deputy has indicated that he proposes to discuss what he calls wage policy. I am submitting that he is not entitled to discuss anything but Section 10.
Deputy Cowan spoke of an increase in wages and I want to point out how contrary that is to the spirit of the man who introduced this Finance Bill. Column 1141 contains a few remarks the Minister made about beer in his Budget statement. At column 1138 there is the preamble:—
"The Government have given careful thought to this problem over recent months. They are satisfied that, as incomes generally have already advanced more than the cost of living...."
He then goes on about foodstuffs and food subsidies and the reduction in these subsidies, meaning an increase in the cost of foodstuffs and, therefore, a reduction in the effective value of wages, and he then moves on to tobacco and beer. They are all in the same framework—wages are already too high; the standard is too high.
That is not so.
I am not saying that that is Deputy Cowan's——
It was not said even by the Minister.
It was said.
I have heard it read out four times and I cannot read that into it.
"The Government are satisfied that, as incomes generally have already advanced, more than the cost of living"— and then he goes on to the increase in the cost of foodstuffs and, in the same context, he comes to tobacco and beer. In any event, does the Deputy disagree with my analysis that what is intended is to stop people spending? Is it not the whole theme of the Budget that people are spending too much?
The Deputy made the point a few moments ago that the Minister's idea was to reduce wages.
So it is — to reduce spending power.
The Deputy is discussing what he described as the whole theme of the Budget. This is Committee Stage and surely the discussion ought to be confined to what is in Section 10?
The Deputy is not entitled to discuss the whole theme of the Budget on this section.
I do not intend to, but I am entitled to give the background in respect of the beer tax which is to bring in £2,400,000. Deputy Cowan's counter to that is that we will have increased wages and social benefits. These points were dealt with by the Deputy in a 20-minute or 30-minute speech and I am entitled to reply. It is said that the beer tax is to bring in £2.4 million, but I have got no answer yet, and I do not think Deputy Cowan has heard any answer, to the point I make. I was in the Department of Finance for three successive Budgets and the information was always supplied that the yield of 1d. on the pint was £1,250,000 in the first year where the Budget was a month or two late and £1,500,000 in a full year. This year, the Budget was introduced on 2nd April, so that the full year's tax will come in. The amount of tax put on should yield £4.5 million, but the Minister says he looks to get a good deal less than that, £2.4 million. Where is the rest of it? If it is going to be reduced consumption, the point Deputy Cowan makes about the publicans is a good one. Their business will go down by the difference represented by a consumption which would yield £4,500,000 and a consumption which will yield £2,250,000.
The margin of profit is arrived at in another way.
It does not matter. Quite clearly, their business is going to drop to the point at which the tax yield instead of £4,500,000 will be less than £2,500,000. I do not believe that will be the result. I feel that there is what we discovered in respect of another matter, the petrol business, underestimation of the revenue and that there will be probably £1,000,000 or £1,500,000 more or maybe the whole £4.5 million. In any event, a considerable sum is going to be taken from the people who will continue to drink beer. The Minister puts it at £2.4 million and Deputy Cowan says, in answer to that, that the pay packet is not going to remain the same. He also says: "Look at the social security benefits." I look at them. Here is a brief statement which can be read at a glance: "Provision for proposals in the Social Welfare Bill and other current services, £3,000,000." A sum of £1,000,000 is held over for something yet to come— we do not know what it is — and there is a sum of £2,000,000 for what is already agreed, and then: Deduct savings on food subsidies, £6,668,000. These are supposed to be less the compensatory social welfare benefits of £2,750,000, leaving a net saving of nearly £4,000,000. Does Deputy Cowan realise that the Government there give their balance sheet — that on the food subsidies they are making £4,000,000 and giving away on social insurance benefits £2,000,000? They have a profit of £2,000,000 from pilfering the people's food. Deputy Cowan thinks that is all right, and, if he does, I hope he will explain it to his constituents.
I said it was not the same pay packet.
Let us agree that it is not. It is a packet increased all over the community by the £2,750,000, but from the community is being extracted £6.6 million.
A pay packet is what you can buy with it.
Out of the pay packet, reduced by the £2,000,000 after the social security benefits have been got in and the extra money paid for food, the housewife has to find £2.4 million for husband's beer, the community husband's beer, and under the next section, £5,500,000 for tobacco and under the section already passed, £1,000,000 and some odd thousands for spirits, the whole thing amounting to nearly £8.9 million. How does the Deputy believe that wage earners are going to be any better off after that? They are having their food increased; they are getting certain benefits and some people are getting some extra compensation; but, over and above, the Government are making a profit of £2,000,000, and then they say: "We want another £2.4 million from you on beer."
We are told that, apart from the benefits given, there is a wages movement on, that the Congress of Irish Unions have agreed to a 12/6 per week increase, or at least have looked for that, and the Trades Union Congress say that that is not enough. That is a misrepresentation of what the Congress of Irish Unions agreed to. The Congress of Irish Unions have agreed that the demands ought to be for 12/6 under very limited circumstances, which according to the documents I have read——
I do not mind about that. If they get that 12/6, obviously their pay packet will be better.
Again, on a point of order, are we discussing the policy of the Congress of Irish Unions or Section 10 of the Bill?
Sir, we are discussing beer.
The Deputy will sit down.
I will not sit down unless it is a point of order.
A point of order, from the Minister.
I am putting it that Section 10 has nothing to do with the policy of the Congress of Irish Unions.
That is not a point of order, and the Minister knows it is not.
I have already asked the Deputy to stick to Section 10 of the Bill and not to ramble all over the Budget.
Sir, I object to the phrase, "rambling all over the Budget." I resent that phrase, and it should not be used. I am speaking relevantly to the point Deputy Cowan used, that the pay packet is——
On a point of order, the Deputy has challenged the ruling of the Chair——
He has not.
——and the expression of the Chair, and has told you that he objected to your ruling in describing that, stating that you were not going to permit him to ramble all over the Budget.
I objected to that——
You have no right to object, sir.
Take your medicine.
This is the Minister for Finance who insulted the Chair six years ago.
And got a special motion passed about it.
Let us assume that there is a demand for wages to meet the increased cost of the beer tax and let us suppose that it is granted. The Congress of Irish Unions and the people they cater for do not represent all the people who are going to pay, in all the households that have to subscribe the £2.4 millions for beer. There are many more households than those affected by the Congress of Irish Unions or even the Trade Union Congress. Have we again to go through that weary process of readjustment that we had to take in hands before, that was left to us before, when we found that the civil servants and everyone under the thumb of the Government had their wages kept down while the cost of living had been allowed to soar? Is this financing being done in the same way? We went through that whole business over a period of three years, trying to adjust the thing to the reducing value of money. Must we do that again because of this beer tax?
I said that the standard of wages is too low. It is, and has been.
The Budget will make it lower.
The Deputy is voting for the tax.
The labour unions should try to bring the standard of wages up.
Deputy Cowan is voting for the Budget on which the Finance Bill is based. In the introduction of the Budget the theme is clearly stated and the refrain running right through it is that incomes have advanced more than the cost of living and, therefore, incomes can be hacked. Is not that the theme of it?
Again, to come back to the other thing which was the background of Deputy Cowan's point. If only in the ratio of the Budget, the first point in the Budget was that we cannot afford this present scale of spending abroad.
Surely that has nothing to do with this section?
It has. Give me a moment.
It is the justification of the tax on beer.
Give me a moment and I will explain. We are spending too much abroad, so one way of remedying that is to reduce the money in the pockets of the people to spend abroad. It we draw off £2.4 millions on beer, it is £2.4 millions less to spend.
The Deputy is relating everything in this Budget to Section 10.
I am relating the tax to the Budget. Surely it is in the Budget that £2.4 millions is going to be extracted from the people under this tax, and that is £2.4 millions less in the hands of the people to spend on goods that have to be imported across the frontier.
Why import them?
If the Deputy means why not spend at home, the reason is that the manufactured goods are not there and they spend it abroad. Surely the two themes in the Budget are that we are bringing in too many goods across the frontier and that the people are too well off?
That is not so.
Surely, when you say that the incomes are above the cost of living and you are going to hack incomes, is not that the same thing? The two things meet when you put a stop to the purchasing power. If we decrease it — as I suggest we are decreasing it by £13,000,000 — by raising the cost of food and the things that people will buy, there is £13,000,000 less to spend on the goods that come across the frontier. Now, £2.4 million for beer is only one part of that, but the whole philosophy of the Budget is in that part, as it is in the other part.
There is no philosophy in raising the money you need to run the country.
That is all right. The Deputy was talking about the time he addressed his constituents. Did the Deputy tell them that when he was talking about getting them social security he meant them to understand that he was going to tax their food to give them social security? I am sure he did not. He would not dare say that in Clontarf.
There is no food tax.
Let me put it to the Deputy this way, that he is going to increase the cost of food to them by withdrawing certain subsidies and the savings on the subsidies will go, in addition to the £2.4 million——
On a point of order——
It means 10d. on the lb. of butter.
I will put the point of order, when the Deputy has the courtesy to sit down. The Ceann Comhairle has already ruled, and ruled with great rigidity, that subsidies could not be discussed on this section.
Except in passing. That is what the Deputy has done. This is not a point of order.
They cannot be discussed on this section.
That is a point of interruption.
Deputy Cowan was ruled out of order when he proposed to discuss the question of subsidies, with which Deputy McGilligan is dealing. I am submitting to you now that the Ceann Comhairle has ruled that out.
He ruled nothing of the sort. It was a passing reference.
Food subsidies should not be discussed on this section. That has already been pointed out to the Deputy.
I am quite agreeable to that and have kept to it.
I was stopped when I tried to speak on it.
I have not spoken as long as Deputy Cowan on this line, although it was regarded as a separate matter. He went as far as he could, while keeping within the rules of order and I believe I am keeping within them, too. The food subsidies are the point at issue with Deputy Cowan, as well as the beer tax. Would he dare go to Clontarf to-morrow and say: "My views as expressed to you mean that you are going to get social security benefits and you are to pay for them, first by an increase in the price of food and secondly by an increase in the price of the beer that I know the husbands in families are going still to consume?" Will he go and say that to his constituents and ask the people to return him as carrying out his election promises? Will he say: "That is the programme I have this year and I believe that is the programme I had last year"?
The Deputy talked about the last election, or, I think, the previous election, and the success he had. Here in my hand is the Budget he was facing them with, here is the table explanatory of the Budget of 1947. There is a whole heap of taxes in it — but what are they for? To pay for subsidies. Taxes were then put on to pay for subsidies. We took off the taxes and kept the subsidies. It is wrong to say that anything we did would require any new taxes. The existing rates of the tax we left would have carried the expenditure we left, including the Civil Service and other demands——
On a point of order, I want to know for my guidance whether I am going to be entitled to discuss whether the Budget of 1951-52 was sufficient to justify——
That is not a point of order. The Minister's grievance is not a point of order.
Leave it to the Chair to decide.
——the whole cost of social services, including the expenditure which was apportioned but not provided for in the Budget — because that is what Deputy McGilligan is now asserting. I ask you if I am to be allowed to controvert that.
That is not a point of order. It is a disorderly interruption — and the Minister knows it.
The Budget of 1951 does not arise on this section. The Deputy might refer to it in passing but certainly may not discuss it.
It is not the Budget of 1951, but that of 1947 — to keep the record correct. One item, the beer tax in the 1947 Budget, was to produce £830,000. That is one of a group and the Deputy went through the country raging against that, as one item.
No.
I think he did. I think I can get him quotations.
There was the whole fundamenal thing.
One excuse that was made for that beer tax, which was one of the many taxes, was that it was to provide the money for expenditure on the subsidy. Now we are removing the subsidies and putting on these taxes. For what purpose? To prevent people spending——
That is not the reason.
The reason is to stop people spending, because the Minister says that the people are too well off and are spending too much. "The gap in the balance of payments is frightening. We must stop all that. We are stopping it by reducing the purchasing power of the people." That, in effect, means that they are reducing the wages of the people. Deputy Cowan is voting for that Budget, and yet he says that he wants to see wages increased. The thing does not add up. It is nonsense.
In actual fact, are we not trying to preserve the economic independence of this country?
The last resort. The Deputy is beaten in everything else.
If that is the case, the Deputy forgot to make that observation in the speech which he made then.
I was hamstrung.
"Ham" is the operative word.
The Deputy indicated that he wanted wages to be increased.
I wanted the trade unions to get an increase in the wages.
I cannot understand Deputy Cowan's reference to the fact that he wanted the labour unions to get increased wages for the workers. If Deputy Cowan votes for this section it means that the purchasing power of the wage earner will be decreased. Every proposal in the Budget and most of the proposals in the Finance Bill were voted upon and they had the wholehearted support of Deputy Cowan. He says to the world: "We have to pay more for foodstuffs and more for beer, spirits and tobacco". He says that the people of the country will have to pay more for these commodities and that that will decrease their purchasing power. He says that their wages are not as great as they should be and then he turns to the Labour Party and, in an effort to save our political souls, admonishes the labour trade unions, as he calls them. On the one hand he decreases the purchasing power of the community and on the other hand he turns to the Labour Party and says that it is the Labour Party's job to get increased wages.
That is the height of pretence on Deputy Cowan's part.
At the outset, the Minister informed us that he desired a very great increase in revenue this year. We are asked, under this section, to supply him with £2.4 million. I assert again that this is a device to take this money from the pockets of the hard-working and poorer sections of the community. Beer is not a luxury though one might be inclined to think so as a result of some of the statements made by the present Minister for Finance and other people.
Beer is the only relaxation which a hard-working man has at the end of his day's work or at the end of the week. The Minister explained that the reason for the extra tax on beer under the 1947 Supplementary Budget was that foodstuffs must be subsidised to maintain the entire family. This time, however, a double-edged weapon is used. Not alone are these taxes reimposed with even greater severity but at the same time the subsidies go by the board. We feel that the Minister is not at all sure that revenue will be as buoyant as heretofore as a result of this great imposition this year because he has also included in his Budget certain protection for small breweries. Why did he do that? Was it not their tacit admission that he was driving the working people of this country to the point when they could no longer afford to buy that simple little luxury. Deputy Cowan, self-appointed understudy cum stand-in to the Minister, is very interested in the closing hours of public-houses in the city. I would remind him that the licensed trade in the little towns and villages and at crossroads throughout the country are also concerned about the matter of closing hours——
I said that.
——but they are afraid of the day when they will have to close their doors and shut down for good as a result of the imposition of these extra taxes if this section is passed. Another blow was the increase of 4d. a gallon on petrol. Every publican in my home town is also engaged in the hackney business.
That does not arise on this section.
The publicans I am referring to are not whole-time publicans.
They are not publicans at all.
I am sure Deputy Cowan would not wish to confine the selling of beer to public-houses in the city. The people in the rural areas must be considered also. However, the publicans in my town and in other parts of my constituency engage in the hackney business to enable them to improve their premises and to provide adequately for the requirements of the people in their areas. Now they are being saddled with an imposition which they cannot bear. Very frequently, their families contribute to the social life of the town or village in which they live. It would be disastrous if those families should now have to emigrate as a result of this imposition. People who are out cutting turf all day like to stop with their creel of turf on the road and go in for a drink. People who work for long periods away from their homes rely on the bottle of stout as a substitute for the tea which they would get if they were at home. These types of people are the hardest hit by this section. We all realise that people with higher incomes have other interests and enjoy other luxuries. They are able to go to the golf course, to bridge parties, and so forth. The small farmer, the farm labourer, the road worker and the people in the rural areas enjoy no such luxuries. I do not want to be taken as advocating heavy drinking. I am merely stating that the proposed tax on the bottle of stout and on draught is unfair to a very considerable section of our community. I may say that a lot of draught is taken.
I would remind the Minister of the effect which the increase in the tax on wine had on a previous occasion. The revenue derived from that tax was not anything like what was expected with the result that the tax had to be remitted.
Throughout the country, a number of people are employed by bottling stores, bars, and so forth. These people are now feeling the pinch. In a bottling concern close to where I live, three men were dismissed in one week.
Was that through the tax on dancing?
That was what he said the last time.
I do not think the Minister has any reason to feel too happy about his own record in view of the fact that in his Budget statement he gave the House and the country figures which were subsequently proved by this Party to be completely wrong. The Minister's conscience should certainly dictate that he should keep his mouth closed. He presented the House and the country with wrong figures.
On the most important day of the financial year.
Yes. To return to what we were discussing, I want to say that in order to secure re-election to this House the present Minister for Finance went to Rathmines and assured his constituents there that if Fianna Fáil were returned to power they would not reimpose the taxes which were imposed under their Supplementary Budget of 1947. I think I was the first Deputy to refer to that speech in this House and while I was doing so the Minister for Finance interjected: "I never said any such thing." The Minister's statement in Rathmines was quoted in the Irish Press— and I am sure that the Irish Press would not misquote Deputy MacEntee. Despite that, Deputy MacEntee calmly stood up in this House and denied that he had ever made that promise to his constituents. However, the Minister was not alone in making that appeal for re-election. Deputy Lemass had to go down to Cork City and make a speech there because the then Minister for Industry and Commerce, Deputy Dr. O'Higgins, told the electors of that city that if Fianna Fáil were returned to office they would reimpose the taxes which they had imposed under their Supplementary Budget of 1947 on the simple luxuries of the people. That matter was considered of such great consequence in the election campaign in Cork City that it was not enough for any one of the four candidates going forward to reply to Deputy Dr. O'Higgins. They had to bring down Deputy Lemass, the present Tánaiste and Minister for Industry and Commerce, to assure the people of Cork that it was not the policy of Fianna Fáil to reimpose this tax. In fact, he said: “Why should these taxes be reimposed?” That was only 12 months ago. In this very year, within a few months of coming into power, they went back on all of these statements which they made so as to secure re-election to this House and re-election as Government. Then they bring in this measure, imposing these taxes.
I say to the Minister, and he will mark my words, that the imposition is of such severity that it will defeat its purpose, that the revenue which he expects will not be secured, because, as Deputy McGilligan has stated to-night, the result will be to prevent people within the limited income group enjoying these little luxuries, and certainly there will be no incentive to increased production, which, we are told, is so vital to the economy of the country.
Did not Deputy McGilligan make the point that the Minister will get in £2,000,000 more than he estimates? Deputy O'Sullivan is making the opposite point, that he will not get in as much.
We are not dealing with the matter of overbudgeting. We know that there is overestimation in the entire Budget. Deputy Corry, I believe, assures us on that point. Deputy Cowan has informed the House to-night that he supports the idea on the understanding that the pay packets will be increased.
I did not say any such thing.
Deputy Cowan will have to be consistent. We know him to be an apostle of consistency. Will he be consistent and support the claims of those people, who have no wage packets, for increased prices for every article they are producing?
The matter does not arise on this section.
The Deputy made the point that he was voting for this tax on beer because he understood that it could be met by increased pay packets and he took Deputy McGilligan up on the point that it would be the same pay packet. I will expect the Deputy to be just as vociferous in the House when the farmers look for an increased price for their products. I hope the Deputy will be then as quick to rise to his feet to help every other section in the community who have not regular pay packets and who will be expected to contribute as much for the coming 12 months to the sum of money which we claim the Minister does not require and which he in his optimism expects to get. Despite the fact that the Minister stated on an occasion which will not be forgotten that the country was on the verge of desperation, he considers that the people are so well off that they can bear the brunt of this imposition and give him the increased amount that he says is required. We do not feel that it is required at all. We feel that the result of this will be to take from the poorer sections of the community and the hardest working sections what was to them, not a luxury, but a necessity.
Is it not a fact that there are doctors who advise their patients to take a bottle of stout? What will be the effect on those people who are convalescing and who need a bottle of beer to nourish them? Is it a luxury to them? Is it not a fact that this Government intend to replenish their coffers by taxing these people? Is Deputy Cowan in agreement with that?
If the Deputy would ask me a specific question, I will answer it. I did answer one a few moments ago but the Deputy changed the subject immediately.
The Deputy is in agreement with this policy but I do not think that he was in a position to inform his constituents, when he so narrowly escaped defeat at the last election, that it was the intention of his new-found friends to do again what they did in 1947 but this time to do it to a much greater extent, an extent which was never envisaged when the people went to the polls a brief 12 months ago. We feel that the Government, in imposing this tax and the other taxes in this Budget, are doing something for which they have no mandate, for which there is no necessity whatever, which can result in decreasing employment, depressing the incentive to produce more and, as has been said by many Deputies, which bears particularly heavily on the section of the community that are least able to bear it.
We have listened to most extraordinary statements here in regard to Section 10. One would think the Irish people lived on porter. We have been told how their pockets will be rifled, how their children will be without bread, their wives made miserable because the price of the pint has gone up by 3d. That is the level at which this subject has been discussed.
It is no laughing matter for many people.
Let us see what is the foundation for those statements. It is proposed to collect £2,400,000 of increased tax on beer. How many people in this country drink beer? Would I be exaggerating if I said the number of beer drinkers ranges between 600,000 and 700,000? Let us take the least favourable figure from my point of view. Assume that it is 600,000. Six hundred thousand people between them pay an additional £2,400,000 a year. Divide the £2,400,000 by 600,000 and you get an average increase of 80/- per year per beer drinker — a little over 1/- a week, less than you pay at the present moment for a packet of cigarettes — about 1/6 per week. The Irish people are asked to pay 1/6 per week per beer drinker— put it that way — in order to enable us to pay the increased old age pension which we carried through last year.
1/6.
It is an addition. They are asked to pay it in order to provide them with the new Social Welfare Bill, in order to pay the increased salaries of all the public officials which have flowed from the fact that the principle of arbitration was accepted by our predecessors when they appointed an arbitrator. Not merely did they appoint an arbitrator but, as Deputy Corry has informed the House, they gave the arbitrator a headline which he could not disregard when he was considering the claims of the civil servants. We are asking them to pay this in order that we might meet the losses on Córas Iompair Éireann, the company which they nationalised, having first of all bankrupted it. We are asking them to pay 1/6 more per week in respect of porter and stout in order to enable us to provide the needs for national defence. Deputy Dillon, speaking on the Estimate for Defence the other day, said that we should have an Army of 12,000 men.
Mr. O'Higgins
Is it in order for the Minister to discuss questions of defence on Section 10 of the Finance Bill?
The Minister just mentioned defence.
Mr. O'Higgins
I am asking for a ruling as to whether it is in order.
The Chair will allow the Minister to develop the point before giving any ruling.
Mr. O'Higgins
I want a ruling.
I propose, with your permission, to develop the point, the Chair having already ruled.
Mr. O'Higgins
On a point of order——
I have already given my ruling.
Mr. O'Higgins
I did not catch your ruling. I ask for a ruling on the point whether the Minister is entitled to discuss matters of defence on this section.
He is not discussing matters of defence.
The Minister would not be entitled to discuss the Defence Estimate on this section.
I do not propose to discuss the Defence Estimate but merely to refer to the fact that Deputy Dillon himself admitted that the standing Army in this country should number 12,000 men. The fact is that under the Government last year the Army had been reduced to 6,000 men. We propose to increase it, and one of the reasons why we are asking people who consume beer to pay a further 1/6 per week is to enable us to provide for the needs of national defence.
That is as good an argument as any.
This section has been attacked here as if we had some sort of sadistic passion to gratify in imposing the tax. We are imposing the tax for a very simple reason. Deputy McGilligan quoted from the Table Explanatory of the Budget. Perhaps I would be permitted to follow him and to point out facts which apparently Deputies who have been speaking have overlooked. On the basis of last year's taxes the total revenue, tax and non-tax, of this State would amount to £86,000,000 odd. On the basis of the Estimates for the Supply Services and the demands for the Central Fund Services, the total expenditure to be provided for would amount to £107,000,000. We are deducting from that "Capital Services", which are the Supply Services which are borrowed for, and they amount to £9,000,000. That represents a net figure which has to be found out of revenue of £98,679,000, as against a total revenue of £86,581,000. Then we have had to add £3,000,000 for the Social Welfare Scheme and for — I want to be quite frank — any unforeseen contingencies which will have to be met or for other purposes which we know may arise.
Therefore, they are not unforeseen.
They are unforeseen because we cannot tell at present what precisely they are going to be, but being practical men of experience, we know that things which are not foreseen will inevitably arise during the year and, as I have said, will have to be provided for. That gives you a total sum of £101,679,000 to be found as against an existing revenue of £86,581,000. There is a gap of over £15,000,000 to be closed. I should like to tell the House, if I may, how that gap has arisen. It has arisen quite simply. There were, first of all, the losses incurred by Córas Iompair Éireann last year which were not provided for in last year's Budget and which have to be provided for in this.
Mr. O'Higgins
I take it that we shall be permitted to deal with these matters later.
There is then the Social Welfare Bill to which I have already referred. There is the cost of the increase in the old age pensions granted last year, which were promised by Deputy Norton but for which no provision was made, and for which we are providing this year out of revenue. There is the increase in the remuneration of civil servants, members of the Garda Síochána, national teachers, secondary teachers, vocational teachers and the officers and men of the Defence Forces, none of which was provided for last year but for which we are providing this year out of revenue.
A Deputy
Out of beer.
There are increased grants for public health authorities which were given last year arising out of the letter which the then Minister for Health, Deputy Costello, issued to local authorities but again for which no provision had been made in the Budget. There is the interest on the Marshall Aid Loan which did not arise last year but which becomes payable in respect of the last half of the current financial year, amounting to £600,000. Then there is the annuity on the voted capital services to which our predecessors committed us last year and for which we have to provide this year. There are these and other incidental expenses arising out of the Estimates. That in the main is how this gap of £15,000,000 has been created.
Deputy McGilligan has said that we must discuss this tax in the background of the Budget. There is the background of the Budget — £9,000,000 to £10,000,000 expenditure, commitments into which you entered last year but for which the Coalition made no provision whatever and which we have to recover out of taxation this year.
It is a wonder you took office at all, if things were so bad.
We would not have taken the responsibilities of office were it not that we wanted to save the people of the country from the Deputies who are sitting over there.
Mr. O'Higgins
And to save your own political skins.
Our political skins will soon be tested and so will yours. There is one thing the people are getting this year and that is an honest Budget. We are not running away from it. When Deputy McGilligan introduced his Budget on the 2nd May, last year, he knew that that Budget would not stand a moment's examination. Rather than face the debate here on the General Resolution in the Dáil, the then Taoiseach rushed up to Arus an Uachtaráin and begged the President to give him a dissolution on the 7th May. That is what happened Mr. McGilligan's Budget last year. That is not going to happen in regard to this Budget. The people know what this Budget is for. They know what services we are providing for and they know why we have to impose this additional taxation on certain commodities — beer and spirits amongst others.
I want to say again that I think the discussion on this matter has been on a lower level than it has been my sad experience to witness for many a long year in this House. We heard Deputy O'Sullivan following in the footsteps of Deputy Oliver Flanagan, that idolater of the porter-barrel, who has now been taken into the bosom of Fine Gael. We have got a new god amongst the Fine Gael Party. May I say this in regard to the suggestion made by Deputy Cowan? I should be very glad to receive a deputation from the licensed trade, provided they come to me as representatives of the trade and not as politicians.
Mr. O'Higgins
With their cheque-books.
I have received a request from the licensed trade to discuss this question of the beer and spirit duties with them, but I received that request, accompanied by the text of one of the most insulting resolutions ever submitted to me. I know the political wangle which was behind the so-called convention in the Mansion House, Dublin. I will not receive Fine Gael politicians masquerading as publicans or receive them under the tutelage and guidance of a person whom I know to be just merely the tool or instrument of the Fine Gael Party, the man who did his utmost to try to ensure that the Fine Gael Party would remain in control of this country after the last general election.
What about Miss Morris?
What about the dance hall proprietors?
If the representatives of a trade association wish to see me in connection with any matter in the Budget, I am prepared to receive them. I shall receive them as taxpayers but I will not receive them as politicians. There are some people I would not receive on any deputation because I would not trust them in the same room as myself. I would not trust them to give an honest account of what would transpire at the discussion. Deputy Cowan has disclosed in this House to-night that a document purporting to be the minute of a discussion which he had with certain gentlemen had been submitted to him and that he had to strike out from the record a statement suggesting that he had given certain pledges and promises to these particular individuals. I will not put myself in that situation. If I receive a request couched in appropriate terms and the withdrawal of what I know to have been a merely political resolution, then I will receive these people, but until that is done I am having no contact with them.
I am only asking the Minister to receive a genuine trade deputation.
I am quite prepared to receive a representative deputation from the trade, but it must be from the trade and not from the Fine Gael element in the trade. I will be quite prepared, as I have always been prepared, to discuss with them any legitimate grievance they have and any way in which I might alleviate any undue hardship which this Budget may cause them, but it must be undue hardship. I will not make it possible for the trade to carry on at the expense of the nation on the basis upon which it has been carrying on hitherto — that it is to be exempt from all public burdens while everybody else is accepting and bearing them.
Deputy O'Sullivan referred to a statement which I made in Rathmines. I did make that statement in Rathmines. I made it in respect of the Budget of that year because I was fool enough to believe that Deputy McGilligan would not stoop to the depths of deception to which he stooped when he presented this Dáil, on the 2nd May, 1951, with a statement which was false and misleading in many essential particulars. I could not believe that Deputy McGilligan would mislead the House and the country for political purposes in the manner in which he did in order to bring in an electioneering Budget. Therefore I assumed that there was no necessity to impose any additional taxation beyond the additional taxation which he had imposed himself in last year's Budget — because he did impose taxation.
This Deputy, who has been groaning and wailing to-night about what we did, imposed taxation to the tune of £1,000,000 in last year's Budget. What is more, he has tried to give the impression to the House that he imposed that taxation unnecessarily. He had been speaking about £2,000,000 he handed over to me. There was no such sum. If he had £2,000,000 in hand why did he find it necessary to impose £600,000 additional taxation on petrol and £400,000 additional taxation on death duties? However, as I said, when I spoke in Rathmines it never entered into my head that a person holding the responsible position which Deputy McGilligan held as Minister for Finance even in a Coalition Government, no matter how much they were at sixes or sevens, would have so deliberately misled the House and the country as to the real state of the public finances. Therefore I assumed that it was not necessary to impose any additional taxation. That was last year, however.
We have a problem to face this year —the problem of finding £15,000,000 to close up the gap between revenue and probable expenditure. Am I to say to the workers of the country: "I will do what the Cumann na nGaedheal Government did when in office? I will reduce the old age pensions. I will tax your sugar and your tea." They put positive taxation on these commodities. Tea and sugar were not subsidised over the years when Cumann na nGaedheal taxed these articles.
Mr. O'Higgins
On a point of order. I take it that it is open to Deputies to follow the line pursued by the Minister?
Deputy O'Sullivan has suggested I gave a perpetual pledge that I would never tax beer and spirits.
Mr. O'Higgins
While Deputy McGilligan was speaking, the Minister raised various points of order in relation to the matters he is now discussing.
Only in relation to the food subsidies.
Mr. O'Higgins
For the last 20 minutes the Minister, without pause, has been discussing various matters not confined to Section 10. I take it that it is in order to reply to the Minister in regard to the matters he has raised.
The Chair will deal with these points when they arise.
I will tax beer and I will tax spirits rather than tax tea and sugar and the necessaries of life. When they were not subsidised the Cumann na nGaedheal Government taxed them. When the prices of tea and sugar were unsubsidised, they levied taxes on them. We removed them. When Cumann na nGaedheal were in office they thought that the prices were not high enough even though they were economic prices. Therefore they increased the tax on them. I will not put myself in the situation that I will allow any trade or profession to go scot-free from taxation if I have to tax the ordinary working-class people. With that reservation, I am prepared to meet the representatives of the licensed trade on Deputy Cowan's assurance that they will come to me as representatives of their trade and not as representatives of the political element in the trade.
The Minister has admitted that he made this statement in Rathmines, but in certain ignorance. He has admitted now that he made the statement. When I first brought the matter up here, he stated categorically in this House that he never said any such thing, and that is on the record. Now he states: "I made that statement, but I was wrong."
Progress reported; the Committee to sit again.