On the motion for the Adjournment Deputy Dunne gave notice that he would raise the subject matter of questions Nos. 10 and 11 on the Order Paper of the 11th instant.
Adjournment Debate—Strength of Stout.
On the 11th of this month I asked the Minister for Industry and Commerce the following questions:—
"If his attention has been drawn to a report in a trade journal to the effect that in 1951 a brewery secured an increase in the price of the pint of stout by one penny through the Prices Advisory Body because the price of barley had gone up to 84/- a barrel and because the firm agreed to increase the gravity or strength of the pint by three degrees; and, if so, if he will now refuse to permit the proposal mentioned in the report to reduce the strength of the pint in order to secure increased profits at the expense of the consumer, especially since the price of barley has been reduced this year to 62/6——
That should be 63/9——
——a barrel and the firm's profit last year increased by over £400,000 to £5,681,000."
The second question, No. 11 was:—
"If he is aware of a statement in the February issue of a trade journal stating that the strength of the pint of stout is much lower than in pre-war times and if he will state if this reduction in strength was made with his knowledge and approval, and, if so, for what reasons; and if he will indicate the exact difference in the strength (a), of stout now, compared with pre-war times and (b), between the stout in question in the Twenty-Six Counties compared with the Six Counties at present."
The Minister replied to both questions together and said:—
"The report referred to by the Deputy has been brought to my attention. I am not aware of any proposal by brewers generally, or by individual brewing firms, to reduce the gravity of their products.
Reductions were made in the gravity of stout during the emergency period, not for the purpose of increasing the profits of brewers, but because of the necessity to conserve supplies of raw materials. As regards the present and pre-war strength of stout, I cannot disclose information supplied to me in confidence in regard to the quality of any trader's products.
I am not in a position to give information regarding the gravity of stout sold elsewhere."
I consider that that reply to those two questions was totally unsatisfactory. There was a conference recently between representatives of the brewers, the principal brewing company, Messrs. Guinness, and representatives of the licensed trade, and at that conference, as the Minister is aware, there was a proposal discussed to reduce the present gravity of stout. I do not need to inform you, a Cheann Comhairle, or any members of the House, or indeed any member of the public, of the importance of this beverage to the ordinary people of this country and to the people, indeed, of many countries, so that in a matter of this kind it appears to me that a proposal of this nature is of very considerable importance. This conference was referred to in a journal of the trade and the Minister admits, in his reply, that he has read the report of the conference to which I referred. He stated, however, that he was not aware of any proposal by brewers generally or by individual brewing firms to reduce the gravity of their products. In that, of course, he indulges in a bit of side-stepping inasmuch as he indicates that there was not, or has not been as yet, a formal proposal to his Department, but the fact that this proposal was discussed between representatives of the brewers and of the licensed trade is inescapable and cannot be contradicted, and that is a matter with which I am concerned—that matter and another very important one to which I referred in my question, the position in regard to the licensed trade generally in Dublin City and County regarding the price now being paid by Messrs. Guinness to farmers who produce malting barley as compared with the price which they were paying in 1951. In 1951, it will be recalled, the firm of Arthur Guinness and Company secured an increase of 1d. per pint in the price of stout on the basis of the fact that they were paying at that time 84/- per barrel for barley. They also made the case at that time that they would increase the gravity of stout. The present price of barley is 63/9 per barrel. There has been no reduction whatsoever in so far as the price of stout is concerned, and that, in itself, to my mind, represents a very great imposition upon the publicans, who act largely, and have been acting largely since the advent of this Government, at any rate, as no more than agents for the collection of profits for Messrs. Guinness, and upon the consumers, who have been forced to pay the increased price for the pint of stout; and it reacts, of course, adversely upon the farmers, who are getting more than £1 per barrel less now for barley, which is essential in the production of stout, than they were getting in 1951 when the increased price was agreed to.
On top of that situation we have mention of this proposal to further reduce the gravity of stout, so that not alone are the farmers being imposed upon and the publicans being imposed upon but the suggestion is that there should be a further imposition upon all concerned by the reduction in the quality of this product. The Minister did not in my view answer my questions in the manner in which he should and it is for that reason that I am bringing these matters forward here. He refers to what he regards as the undesirability of disclosing information supplied to him in confidence in regard to the quality of any trader's products. I would like to know why should there be any in confidence disclosures in a matter such as this to the Minister. Why should not the public know what is the difference now in the gravity of Guinness's product as compared with pre-war? What reason is there for it? There is no good reason that I can see and no good reason that the public can see.
This firm made £400,000 more last year in a period when publicans have been forced, many of them, into bankruptcy, during a period when the City of Dublin and the County of Dublin publicans are finding it almost impossible to keep their doors open because of the falling-off in trade which has resulted from the increased price which has had to be charged to the consuming public by reason of the policy of the present Government, and particularly by reason of the Budget of 1952 when, as we all know, the tax on this product was increased.
The Minister in reply to a supplementary question of mine of 11th March in regard to this colossal profit made by Messrs Guinness indicated that this firm had its headquarters in London, the implication evidently being that this profit was not made entirely in this country but was made elsewhere. I am strongly of the opinion that it could be very easily proven that a very great proportion of Messrs. Guinness profits is made in this country. I have not heard of any other country in the world where they are producing porter and stout in such great quantities as they are produced here, so that we may assume that the additional profit of £400,000 which they made last year was very largely at any rate, taken from this country, taken from the working people of this country through the agency of the publicans who, as I say, in many cases have been reduced to the position of being no more than profit collectors for Messrs. Guinness.
Messrs. Guinness made £5,500,000 last year in all their activities. I think it is most unreasonable, therefore, that there should be any suggestion of a reduction in the gravity of stout. I do not think it would be at all unreasonable for the Minister to take any steps in his power to bring about a situation whereby Messrs. Guinness should plough back at least some of the colossal profit which they made, into this country by a reduction in the price of stout as supplied to the publicans. I think that that is something to which the Minister should give attention. I do not think it is incorrect to say that this firm has a monopolistic stranglehold on the licensed trade here. It seems from the report in the journal to which I have referred that they do not propose to brook any interference whatsoever with the profits which they have been making over a long period. That as far as I am concerned is wholly and entirely objectionable.
I have been informed by a very reliable authority, who has many years' experience in so far as the licensed trade in Dublin is concerned, that a recent examination of 30 accounts of Dublin City and County publicans showed that whole cash receipts increased by 6.2 per cent., as a result of the 1952 Budget and as a result of the increase in the price of stout, the net profit of these publicans fell by 50 per cent. There is this comment made by the gentleman, and I think it is worthy of consideration and of notice: "This means the virtual overnight destruction of the equities of hundreds of small vintners and a critical reduction in the value of the equities of all Dublin vintners. In effect, the Dublin trade is, but for the withholding of bank action pending the Budget, due to experience the greatest crash since the period after the Boer War."
There is obvious exploitation, to my mind, so far as this brewery is concerned, and it is time some steps were taken in regard to that exploitation. It is most undesirable that any proposals of the nature which I have mentioned in the question, should even be considered by the bodies concerned. The Minister has not indicated to me in his reply what his attitude is likely to be in so far as proposals for a reduction in the gravity of stout are concerned. I should like to know from him, if there is such a proposal, will he take a firm stand in the matter to ensure that no further exploitation of the consuming public or those who sell Guinness's stout will take place?
Those are the matters which I want to raise here to-night. They are, as I said, of very considerable interest to many people outside the House. I do not know what plans the Government has in so far as the Budget is concerned, in regard to the price of this popular beverage. It may well be that an effort will be made to regain lost ground by a gesture towards the licensed trade and towards the consuming public. I am not concerned with that; it will not matter anyway because it will be too obvious an effort to capitalise politically, for the people to be deceived by it. Certainly, I think that the Minister should determine that no further exploitation of those who are engaged in this trade will be tolerated and that the suggestion that is made in the report referred to will not be even considered by the Minister.
I should like when he is replying if he would indicate what steps it is proposed to take to bring about a reduction in the price of the pint which as I stated before in this House on another occasion, though it might be regarded by some as a luxury, by many hundreds or thousands of people who work hard, manual workers in this country, is not considered a luxury. While it could not be described as a necessity, it is something in the nature of an amenity to which they have become accustomed. Because of the machinations that have gone on, so far as the brewers are concerned, and because of the attitude of the Government—their utter disregard of the consuming public and the publicans as well—great hardship has been caused. I submit that it is necessary that the Minister should indicate what is in store in regard to this particular matter for the future.
I gathered that Deputy Dunne read the report, which appeared in the paper called the Licensed Vintner and Grocer, of a conference between the representatives of the Licensed Vintners and Grocers Association and the Irish Brewers Association but he does not appear to have read the report very carefully. I know nothing about the matter except what appears in the report but it is clear from it that, while a suggestion was made by the vintners that they should get an increased profit margin from the brewers through a reduction in the gravity of the stout sold, the brewers were strongly opposed to that suggestion. I told the Deputy that I had no information of any proposal by the brewers' association or by any individual brewery to reduce the gravity of the stout as sold. I do not know that I should even consider the consequences of such a proposal until it is made. So far as I know, the brewers are strongly opposed to the whole suggestion and it is most unlikely that the proposal will ever be made.
The Deputy wants to know what is my attitude. On the same day as he addressed the question to me, he addressed a question to the Minister for Finance and he was told that if the gravity of stout was reduced by one degree, the Exchequer would lose £200,000. Does he want any more information than that?
Deputy Dunne said that the brewers got an increase in the price of stout in 1951 because the price of barley went up. That is not the whole story. In 1951, the brewers applied for an increase of 17/6 in the price of a barrel of stout because their costs had gone up—not merely because the price of barley had gone up but because all their costs had gone up. The Prices Advisory Body considered their application and recommended that they should get an increase of 12/6 a barrel, provided they increased the gravity of stout by three degrees. I am assuming that the Prices Advisory Body went carefully into the whole question of the profits made by the brewers and that they made their recommendation on the basis that only reasonable profits were being earned. Since then, there has been a reduction in the price of barley, it is true, but other costs have gone up and the price of barley does not alone determine the costs of producing stout.
The Deputy who is now pressing for a reduction in the price of stout did not note or did not refer to the statement made at that conference on behalf of the brewers' association that, if the price of stout was reduced, small brewers would be forced out of business immediately. I do not know if he would regard that as a desirable situation. I cannot say if Messrs. Guinness could carry a reduction in the price of stout on their Irish trade, but it is quite clear that, if they did reduce the price of stout, every other brewer would either have to follow suit or abandon the prospect of getting sales. We know that every other brewer would be unable to continue in business, so that there would be only one brewery left and a very large number of workers would be unemployed. We do not think that is a desirable situation to provoke.
The reference to the profits of Messrs. Guinness is, of course, completely misleading. Messrs. Guinness are an organisation with headquarters in London and they have a world-wide trade. It is true that they operate a brewery in this country, but the profits to which the Deputy referred were made on the whole of their trade throughout the world. I am assuming that their profits on their Irish trade are reasonable because the Prices Advisory Body examined that position in 1951 and have examined the position on any occasion on which it was referred to them since; but, even in relation to the Irish brewery of Messrs. Guinness, the Deputy is no doubt aware that by far the greater part of their production is exported. We could undoubtedly take action which would put the firm out of business, but I think it would be a big loss to the country to do so and the Deputy would have some difficulty in explaining his advocacy of that course to the many thousands of workers whose livelihood would be affected.
So far as the gravity of stout is concerned, there is no proposal to reduce the gravity. Every indication that was given of the attitude of the brewers showed their opposition to the proposal. It is, therefore, most unlikely to be made by them. The position of the industry, as revealed by this report, indicated that there was a desire on the part of the vintners to get an increased profit margin. It is possible that the vintners have a good case to make for that. I do not know whether they have or not. They had at that time a proposal that the price of stout to the public should be increased, so that they would earn an increased profit margin. I understand they have abandoned that proposal and, according to this report, published in the Licensed Vintner and Grocer, it was decided that two associations, one representing the vintners and the other representing the brewers, should approach the Minister for Finance to discuss the position with him. Whether that approach to the Minister for Finance will have any repercussions in the Budget is something which the Deputy must wait and find out when the Budget comes in.
The Dáil adjourned at 10.55 p.m. until 3 p.m. on Thursday, 25th March, 1954.