Like a number of other Deputies on all sides of the House, I should like to begin by saying that I appreciate very much the manner in which the Minister outlined the state of our national economy. His opening statement was honest, straightforward and blunt. It was a very different approach from that made by the former Minister for Finance in the other inter-Party Government, and for his honesty and frankness in giving us a true picture of the situation, we must feel grateful to the Minister on this occasion.
His opening statement, to my mind, at any rate, disclosed an alarming state of affairs, especially in connection with two key matters. As far as the capital side of the Budget is concerned, two matters were disclosed by the Minister that should give food for serious thought to all Deputies. The first point that was brought home clearly by the Minister was our failure to increase agricultural production. A second point was the lack of money to finance the capital development programme. I intend at a later stage of my short contribution to this debate to deal with those two major problems, but I will turn from them now to deal with another aspect of the Budget which relates to the day to day administration of Government Departments and the cost of the State service which has to be met in the normal way through tax revenue. Here, again, the outlook as disclosed by the Minister is gloomy. We find that the revenue from present sources and from taxation already in operation will be insufficient to meet the proposed expenditure in the current year and the Minister has found it necessary to impose further taxation in order to make ends meet.
The Opposition is fully entitled to lambast the present Government and its supporters for their failure to implement promises made in the 1954 election campaign. Unquestionably, the present Government have failed miserably to carry out specific promises to reduce the cost of administration and the cost of living. The Opposition are entitled to make any denunciation they like in regard to the 1954 promises, but that is a privilege of an Opposition in a democratic State, and it is a privilege that will lie with the present Government should they become an Opposition. That is purely a question of tactics and taking advantage of an opportunity to play Party politics for the benefit of whatever Parties are out of office. All I will say in connection with these promises is that this trail of broken promises that has been referred to did not begin just prior to the 1954 Budget. Since I came into this House in 1948 I have been listening to promises made by all Parties and have yet to see those promises fulfilled.
The people in general, the supporters of Parties on both sides of this House, are becoming more cynical and more disillusioned with regard to promises made by political Parties on the eve of elections.
On the question of the cost of Government administration, I have a distinct recollection of hearing this matter discussed annually in this House. Everybody seems to be of the opinion that the cost of administration is too high and each year whatever Government is in power agrees with that criticism and says they are about to take the necessary steps to reduce the cost of administration. So far, there has been no concrete proof that any Government have fulfilled their promise in that regard. If there is criticism levelled now by the Opposition, and if they belabour the present Government for their failure to reduce the cost of administration, it is merely a case of the pot calling the kettle black.
Let us take the Civil Service. This giant octopus is growing all the time, stretching out new tentacles every year. We have yet to meet a Minister for Finance who has the courage to take his axe and lop off some of these tentacles. The simplest and easiest way of reducing the size of the Civil Service, without doing harm or without causing unemployment in the ranks of the Civil Service, is to reduce the intake to the service. I am not competent to judge what the percentage should be. There are experts available to the Minister for Finance to decide what the maximum percentage cut should be in the numbers taken into the Civil Service, without prejudicing the efficiency of the service at a later stage.
There should be a reorganisation carried out within the service. Where an officer resigns, through ill-health or for other reasons, close examination should be made as to whether his duties should be spread over other officers rather than that the appointment should be filled. When some such steps are taken in the initial stages— in other words, when there is a reduction in the intake to the Civil Service— we will begin to believe that some Government is serious about its statement that the cost of Government will be reduced.
The position we find ourselves in at the moment is that the revenue is insufficient to meet the outgoings. It is a matter that we all have to face up to, despite the criticism that can be levelled at the Government for failure to carry out promises. If money is needed, whatever Minister is in power must explore the various avenues available to him and search out the commodities that can safely take a further imposition by way of tax duty. The present Minister for Finance has selected two commodities, tobacco and petrol, which, in my opinion, can and should bear further impositions. Both of these commodities are paid for in valuable dollars. They are both imported consumer goods. If a tax must be imposed on anything, let us start with imported goods, especially imported goods of a consumer nature.
It is not a popular thing for any Deputy to walk into the Division Lobbies to support a Government who impose fresh taxation. In my position as an Independent, with no ties to any Party in this House, it would have been much simpler and easier for me to walk into the Division Lobby and to vote against the Government, but, when the money had to be got, I feel that the Minister did the honest, straightforward thing in selecting imported goods in order to get that necessary money.
I listened to Deputy MacEntee's speech on the Budget. He agreed that the Minister had given a correct picture of the situation, but he then went on to say, at column 176, Volume 157 of the Dáil Debates:—
"I am merely going to point out that in this Budget the Minister is continuing to subsidise consumption and increase expenditure,... The Minister has diagnosed the disease, but has lamentably failed to apply the remedy."
What can anybody, in all fairness, deduce from that statement? "The Minister," he said, "is continuing to subsidise consumption." To my mind, that statement means that Deputy MacEntee, if he were Minister for Finance and if it were necessary for him to impose fresh taxation, or to get more money to meet the outgoings, would, instead of taxing tobacco and petrol, have removed the food subsidies. That is the only interpretation I can put on his remark that the Minister was continuing to subsidise consumption—in other words, the people are eating bread at too cheap a price.
If Deputy MacEntee or any other Deputy had said that the millers were getting too much out of this, and if he were prepared to remove the subsidy from the millers, without having the price of bread increased, then there would be many Deputies to support Deputy MacEntee or any other Deputy who would stand firm on such a policy. However, I am afraid that day is a long way off yet. The present Minister for Industry and Commerce does not fill my heart with great hopes by his pronouncements on various matters that he will be the one to examine thoroughly this question of the profits of the millers. My stand on this is that if taxation is to be imposed, if it is essential for the Minister to get the money, let it fall on imported consumer goods first.
I might digress at this stage to ask the Minister if it would be possible for him to consider some way of safeguarding the older section of the community —the old age pension group—as far as the increased price of tobacco is concerned. I would make a strong plea to him to shelter them from the increase that has been imposed.
The imposition on petrol is a natural follow-up of the restrictions that had been placed through a form of purchase tax on imported commodities such as commodities for the assembling of cars, and so forth. The Minister is anxious to bring about some balance, as far as our external spending is concerned. It was essential that cars, spare parts and petrol should bear a fair penalty. The first reaction to the Government's decision in connection with this imposition on petrol came very swiftly last week from one of our petted and pampered so-called industries, that is, the motor car assemblers. This sheltered and pampered bunch of profiteers, having had a free run for years, are now dismissing their unfortunate workers, so that pressure can be brought to bear on the Government to restore the fat profits to the directors and other parasites attached to this doubtful industry. Did these gentlemen at any time consider ploughing back some of the profits they made in the assembly trade into the financing of a plant that would manufacture cars here in Ireland? Not at all. All they wanted was the biggest rake-off possible. The most shortsighted policy possible was shown by these people. In order to allow them to keep their big cars, to rake in the big profits, the Irish motorist had to pay through the nose for his motoring.
We spend almost £110,000,000 per annum on the importation of materials for industry and most of these so-called industries are of the assembly type. I have the utmost sympathy with the men who are going to lose their employment. I hope the Government will be in a position to cushion these men but I hope the Government will not allow pressure of any kind from these gentlemen to sway them from the decisions they have already made. We can take it that the increase in the price of petrol played only a very minor part in the decision arrived at by some of these assemblers to close down the plant. I want to quote from a recent article by the special correspondent of the Irish Press. He said:—
"The heavy unemployment now facing motor car assemblers should not have come as a surprise to anyone in the trade or even to the ordinary motorist. It has been evident for a long time that cars were being assembled at a much greater rate than actual sales."
That was the position. As far as the motor assembly industry is concerned, this crisis was coming for months past, but these gentlemen utilised the recent increase in petrol to spotlight the situation and to try to embarrass whatever Government happened to be in power in order to restore the fat profits to the directors and other gentlemen attached to the industry.
I want to repeat that, if money had to be found, the Minister made the obvious and correct choice. Another point that emerges as a result of the Minister's imposition of the tax on tobacco and petrol is that every possible means of raising money for budgetary purposes has now been exhausted. All the avenues have been explored for many years past. I think that situation will have to bring an air of reality into future Budgets. Personally, I can see only a very limited number of items that can be taxed in the future that will bring in anything like a reasonable amount of money. Therefore, so far as day-to-day spending is concerned, if there is to be any increase in future, the very great difficulty the Government will be up against is where they will get the money.
At the beginning of my speech, I referred to the two main features of the Minister's statement, as far as the capital Budget is concerned. The Budget itself disclosed a most remarkable state of affairs. I might describe this as "the eve of the crisis Budget". It disclosed two significant facts which will have a vital bearing on our future as a nation. The first is our failure to increase agricultural production. Our net output last year, instead of increasing, actually declined. I understand the present Minister for Agriculture is not inclined to accept the statement of his colleague, the Minister for Finance, in that regard. I am prepared to accept the view of the Minister for Finance and I am also prepared to accept the viewpoint outlined by the editor of the Statist in a leading article of the 9th March, 1956, on “Ireland, the Economic and Financial Scene.”
In that article he said:—
"Ireland, one of the great agricultural nations of the world, is now in the anomalous position of having failed to increase farm production over pre-war while all the other nations of West Europe have succeeded in increasing it significantly."
He goes on to say:—
"This is a dangerous situation for a country whose economic survival and progress depend almost entirely on her ability to make her farms produce more."
The man who wrote that is neutral in his political outlook as far as this State is concerned. He is in favour of neither Fianna Fáil nor Fine Gael. His feeling is that the situation is serious as far as our agricultural production is concerned.
There are many of us in this House and outside it who saw that position for years past. All Parties in this House must share responsibility for that position. To my mind there has been far too much Party politics attached to this, our primary industry. We have the position of every Party Leader taking unto himself the mantle of Moses to lead the people into the Promised Land. Every step that was taken so far as agriculture is concerned in this leadership has led the country into stagnation and despair.
In so far as this Budget reveals Government policy towards agriculture, it differs not one whit from other former Budgets because it holds out no ray of hope for the future. I believe that we must at this stage immediately declare a truce to the political warfare, as far as agriculture is concerned. We must put an agreed policy into operation. We must have an intensive tillage programme and a vast inspiring land distribution programme as well. A feeling of security must be given to the farming community that they can produce the maximum from the land without having to face the ever-present, ominous threat of foreign foodstuffs pouring through our ports. That is all I have to say on this Budget in regard to that particular industry but I hope those words of mine will sink into the ears and minds of those people who have it in their power to bring about the necessary change.
The second alarming fact disclosed in the Minister's statement was the likelihood that we would be short of money to finance our capital development programme. I believe that situation is coming closer every week and the seriousness of that situation was dramatically spotlighted by the failure last February of the £20,000,000 Government loan. That loan, as we know, was issued at most attractive terms and yet it closed when only £9,000,000 was subscribed.
Certain people will suggest that the rise in the British bank rate is responsible. If they take that view, they must admit that our control of our finance is nil if the British decision to raise their bank rate had such an adverse affect upon our loan. They cannot have it both ways. I believe it was essential for the Government to close the loan at that stage. I am of opinion that many subscribers to that loan would have hastened to withdraw had they the opportunity of doing so even at that stage.
The failure of that loan is the most significant signpost in the downward trail leading to political and economic serfdom. In my opinion, at no time, except, perhaps, on paper, was our capital development programme of an inspiring or breathtaking nature. I can only describe it as cautious and conservative but, cautious and conservative though it may have been, we cannot afford to slacken down on it in the slightest degree. If we allow a halt in this limited capital development programme to take place our future as a nation will be jeopardised. A slackening in the programme will result in a further intensification of the depression and the feeling of helplessness and hopelessness which prevails among our people with a consequent impetus to a further increase in emigration and unemployment.
If we are even to continue with this capital development programme at the present rate, how is the money to be found? If we are to expand it—and I think that is essential—and if we are to solve unemployment and emigration within our lifetime, how will the money be got? An annual national loan is no longer feasible. I do not think any Deputy in this House believes that the savings campaign that has been got under way will produce enough money to finance our capital development programme because as far as our savings programme is concerned the public will rightly say: "Why does the Government itself not set the example?" The motto as far as Government savings is concerned—I refer to administration and not the question of capital expenditure—seems to be: "Do not do as we do but do as we tell you."
In my opinion, we have reached the end of the road as far as the working of the present financial system is concerned. Every dodge invented, every financial manipulation possible and every financial three card trick has been used and exploited to the full to keep the whole financial machine going. We have been under the thumb of an out-moded machine since this State achieved the freedom we have to-day. We have been controlled by this out-moded financial system while every other country in the world has remodelled and modernised the financial structure and moulded that financial machine in such a manner as to meet the requirements of the particular country concerned. When will we wake up to the fact that a change of mentality is necessary as far as our financial system is concerned? Now I do not want to repeat what other Deputies have said but, while I have it in mind, I would at this stage like to pay tribute to Deputy Declan Costello for the progressive outlook he has shown in relation to our financial problems in the course of his contribution to this debate. It is a great pity that there are not many more Deputies on both sides of this House prepared to make a similar statement.
I would like to give one or two short quotations on this question of our financial problem. One is a quotation from Arthur Griffith's newspaper, dated 16th June, 1906. It is an article written by Griffith on Ireland and its banks and it concludes by saying:—
"Even if we won some form of local self-government we should be little better off, in a material sense, so long as the money of Ireland is drained off by the banks, and used for foreign purposes."
That statement was written 50 years ago. He went on to say:—
"...the Irish banks are mere collecting agencies for financial corporations in London. By their instrumentality the wealth of Ireland is... drained off into England, thereby starving Irish industries, engendering pauperism and fostering emigration. We might as well expect a man, whose life-blood is rushing from a main artery, to exhibit health and energy as to expect Ireland, whose capital is being systematically drained off into English channels, to develop its industrial resources. Emigration is bleeding the country to death. Irishmen emigrate because they cannot find work at home."
That was written 50 years ago by a man who played a tremendous part in helping to secure the freedom which allows Deputies like myself to speak here.
I want now to ask some questions of the older men on both sides of this House. Was Arthur Griffith wrong in that statement 50 years ago? Has the situation changed in that 50 years as far as the financial and banking system is concerned? Has that change been brought about that the older men on both sides of this House fought to secure so far as our national freedom is concerned? What did Padraig Pearse mean when he said that he wanted "to see Ireland not free merely but Gaelic as well, not Gaelic merely but free as well?" Did he and Connolly and all the others visualise an Ireland with a flag of its own, with a Parliament of its own, with its letter boxes painted green and its buses painted green, where all spoke the Irish language but where the financial control, the life-blood of the nation, was exercised outside the State?
I know perfectly well that was not the vision that Pearse or the other men who died in 1916 saw. That was not the type of Ireland they wanted to see when they made the supreme sacrifice. I believe they envisaged an Ireland wherein the nation's purse strings would be controlled and guarded on behalf of the Irish people by an institution responsible to the Oireachtas. These men never envisaged the situation that exists to-day where we have people without money endeavouring to start industries while those who have money insist on investing that money abroad. These men who died in 1916 never envisaged the day wherein the bad example of spending abroad would be set by the Government Departments themselves. I do not think they envisaged the day when they would see Irish Ministers flying to the ends of the earth, tipping their caps to foreign speculators, whispering in their ears of the rich spoils available in Ireland in the line of fat profits and telling them of the large pool of cheap labour which is available, while at the same time the Department of Industry and Commerce and other Departments were pouring the nation's money into British securities.
I shall not deal here with the commercial banks or criticise them to any extent. As far as they are concerned, their first responsibility at the moment is to their depositors and they feel it is their duty to invest the money of their depositors in the safest possible securities. The mentality of the directors of the commercial banks seems to be that the safest and best place to invest money is outside the country. We will have to see if there is any way in which we can make them change their mind in that respect.
It is time that the responsible members of this House readjusted their views on financial matters. I hope that it will not be said that I am too critical of the situation or of the efforts that have been made by the different Parties in the past. I know perfectly well that the older men in the different Parties here have done the best they could under the circumstances. They met with very grave difficulties on occasion and they were under a very grave handicap, mainly as a result of the Civil War. That day, however, is gone and the young people now are not worried about the past. That may sound hurtful to certain people here, but time marches on, and the younger men to-day who are coming into politics are more concerned with economic and financial matters, with the improvement of the country in so far as employment and so forth is concerned, rather than debating the past. It may be necessary at some stage—I do not know when—for the younger men on both sides to break the bonds of Party discipline. I believe that loyalty to the country should come before loyalty to the Party and, in relation to the situation as outlined by the Minister in his eve-of-the-crisis Budget, the time is coming nearer when Deputies on both sides of this House, with a similar viewpoint on economic and financial matters, should come together, outline their policy, stick together and forget the Party tie.
In conclusion, I do not think it would be inappropriate for me to point out how Partition has reacted unfavourably on the economic situation here in this State. It has reacted unfavourably in the financial sphere, as far as successive Governments are concerned, on budgetary proposals. I wonder is it possible at this stage that the Government would consider seriously making an approach to the Government of the Six Counties, purely on matters dealing with industrial and agricultural production? We have the situation here in which the Minister for Industry and Commerce and his advisers have toured America and Europe, asking industrialists and other people to come here to Ireland and set up factories and we have the position in the North that Lord Chandos and his advisers are now off on the rounds that the Minister has already done. They are asking American industrialists to come to the Six Counties and set up industries there.
I think it is sheer lunacy to have two parts of the one island competing for industrial concerns and going into competition with each other on a limited market. I do not think it is too much to suggest that the Government should invite the hard-headed northern businessman to co-operate in the industrial and agricultural spheres. I will put it this way: if we send our representatives to Strasbourg, or to meetings of the O.E.E.C., they are the first to argue that, as far as Europe is concerned, there should be co-operation among the nations, co-operation on industrial matters, the use of raw materials such as coal and steel, between Germany, France and the Netherlands; and co-operation—in the "Green Belt," I think they describe it—on agricultural matters. If we are able to preach that programme abroad to Europe—and I believe it is a good programme to have that co-operation and interchange—why can we not start at home? Why wait for the people in the North?
We should issue the invitation to the people of the Six Counties to set up a joint committee on industrial and agricultural matters, so that a working arrangement can be made that goods, whether they are agricultural or industrial, that are produced either in the Six Counties or down here will have free passage across this alleged border. All goods produced within the four shores of Ireland would have free passage and there would be no taxation imposed. We already have co-operation in regard to hydro-electrification, and if we have it in that, I do not see why we could not have it in other spheres——