The first question that arises on this Bill is why it was considered necessary at all. The Undeveloped Areas Act which the Minister referred to provides for the giving of grants and other forms of State assistance to industrial undertakings established in counties west of the Shannon, along the western seaboard. That Act provides that it can be extended by Ministerial Order to any other area. So far as the Minister desired to take power to give grants to aid the establishment of new industries in other areas, he could have done so at any time by making an Order under Section 3 of the Undeveloped Areas Act.
Why did he not do it that way? I think the decision to avoid making an Order under the Undeveloped Areas Act and introducing a new Bill was a political one. The Minister did not want to appear to be merely relying on the Undeveloped Areas Act and did not want to draw attention to the effect of the introduction of this measure on the policy which the Undeveloped Areas Act was intended to implement. I think that fact must be fully considered by the Dáil.
In 1951, the Undeveloped Areas Act was passed by the Dáil for the express purpose of giving a particular inducement to persons proposing to establish new industries in this country to go to the West. It was deemed to be in the national interest that there should exist some attraction to intending industrialists to locate their activities in that part of the country. Reference was had to the fact that the West of Ireland had failed to secure advantages from the industrial development programme launched in 1932 to the same extent as other parts of the country and to the fact that, at least at that time, emigration from the West was far heavier than from other parts of Ireland. There was a general acceptance of the argument that it was to the advantage of the nation as a whole that the balance of industry should be more equitably distributed and that Government policy should be directly aimed at encouraging industrial development in that region.
We put into that Undeveloped Areas Act this provision which enabled Orders to be made by the Minister for Industry and Commerce extending the Act to other areas for particular reasons. The old congested districts, which were the areas deemed as being undeveloped, were not, perhaps, very scientifically delineated and it was realised that adjacent areas had equal claim for State assistance in the promotion of new industries and that the national aim, to which I referred, would be just as well served by getting them into these adjacent areas as into districts clearly within the limits of the old congested districts.
During the course of the discussion on that Bill and many times since its enactment, Deputies have urged in the House that Orders should be made extending the Undeveloped Areas Act to other parts of the country. For myself, I was inclined to resist most of these representations. At any rate, I refused to consider the making of an Order of that kind until a specific industrial proposal was in the picture and it was clear that the furtherance of that proposition depended upon the making of the Order, because, as I explained on many occasions, the whole effect of the Undeveloped Areas Act, the whole policy enshrined in it, was weakened by every extension of the area to which the Act applied. The Minister has now come with a Bill to introduce virtually similar provisions for State aid in the form of free grants to industrial projects in any part of Ireland. I suggest that the reason he is doing that by a separate Bill is that he realises quite well that it involves the virtual abandonment of the Undeveloped Areas Act and the policy it represents. That may be a good thing or a bad thing but it is undesirable that the effect of what is proposed here should be concealed.
Why is it considered necessary at this stage that State aid to new industries should be given in the form of free grants? One would have thought that the Minister himself would have felt obliged to give some explanation of his own change of attitude in that regard. When the Undeveloped Areas Act was being discussed here and when a proposition was made by Deputy Dillon that aid to existing concerns in the West of Ireland should not be given by way of free grant but should be given only by way of loan, the present Minister for Industry and Commerce was the strongest advocate of that point of view and divided the House on the principle of giving free grants to industries even in the most remote western districts.
At column 1063, Volume 128 of the Dáil Debates, he said:—
"We are now engaged in passing a Bill the object of which is to make £2,000,000 available to promote private enterprise in the undeveloped areas. That £2,000,000 does not belong to private enterprise. It is £2,000,000 of public money which has to be raised from the pockets of the taxpayers and which may be raised in such a form that every citizen, and particularly the lowly section of our community, will have to contribute. As custodians of the public interest, we ought to concern ourselves with how this public money will be spent. While it may be necessary, in order to encourage industry in the undeveloped areas, to give grants in special cases where no other method of inducement will encourage the establishment of an industry, we ought to be careful, I think, when it comes to giving a grant to any person, firm or corporation which, in fact, may not need a grant."
Later on he went on to argue that it would be sufficient to give aid to industries, even in the West of Ireland, by way of interest-free loans, loans which would be repayable, the money coming back, as he said, into the kitty.
His suggestion at that time was not acceptable to the Dáil. The amendment, which he supported, was defeated, but it was not because of any lack of strength in his advocacy against the policy of giving free grants to private industry. Now, however, we have this proposition to give free grants to private industry anywhere. No statement has been made to the House to lead us to believe that anything will come of it. No argument has been advanced to show that it is necessary and no attempt has been made to analyse the possible consequences of the provision.
Is it true that industry is being held up anywhere by shortage of capital? It may be so. Here and there, in the past, it did happen that individual industrial concerns which appeared to have the possibilities of expansion were held down by inability to get sufficient capital. To meet that situation, the Industrial Credit Company was set up, the Trade Loans (Guarantee) Act was passed. Various devices were adopted, to make it possible for industrial concerns to get whatever capital was required, either by way of investment or by way of loan, to enable them to proceed.
I have urged already here that, in present circumstances, having regard to the policy being pursued by the commercial banks, the general tightness of money now existing, it is desirable that the resources and, perhaps, the powers of the Industrial Credit Company should be extended, that that undertaking should be enabled to provide money for industrial expansion through investment in the shares of private undertakings, shares which it might not be desirable to market at the present time, or to deal with smaller concerns by way of repayable loans or the purchase of debentures. I think that is necessary but I think that is all that is necessary and, indeed, I am quite certain that, if that were done, it could be said that no industrial concern with any prospect of development, any prospect of making a profit, would not be able to proceed because of shortage of money.
What is the danger we are facing because of this proposal? The Minister is taking power for the Industrial Development Authority to give grants to any new industrial enterprise anywhere. The danger is that no industrial enterprise will ever start again without getting this free grant from public funds. We have a provision in this Bill which obliges the Industrial Development Authority to take certain things into account and a section which also gives them power to impose conditions. These are provisions which I think are likely to be far more effective in retarding industrial development than helping it. I believe that over the main part of the industrial field, private enterprise is the best force on which to rely.
I recognise that private enterprise is frequently unable to operate fully effectively in present circumstances and I have been urging courses of action which will tend to make it more effective but it seems to me that getting industrial concerns into a position where they are under the thumb of the Government, where they must conform to conditions, and keeping them there by the inducement of free grants, is a bad policy.
If it could be shown that any single industrial proposition that would not otherwise proceed was likely to go ahead quickly because of the provisions of this Bill, I would say that that is an argument in its favour. We have not been told that. Indeed, no reason has been advanced for the Bill at all. There is an implied assumption that industrial development has been held up by the absence of free grants. That is not true. Industrial development has been held up to some extent by inability to get capital. Meet that by making it possible for it to get capital. You do not have to meet it by going into the pockets of the taxpayers to hand out grants of this kind when, by doing so, you are creating a situation in which concerns that might otherwise develop will not develop unless this grant is given to them and where the policy of western development is negative at the same time.
I must confess that I have a very considerable dislike of most of these proposals for money for nothing and, in the past, whenever I had as Minister to bring propositions here involving Government grants of any kind, for any purpose, I felt obliged to defend the proposal in full, and the absence of any attempt to defend this Bill by the Minister in introducing it, the unwarranted assumption upon which he based his remarks, indicate to me that no very great thought has been given to this proposition at all.
The Minister referred to the Finance Bill that we have just been discussing. The implication is that this Finance Bill gives some enormous financial aid to industry. I have calculated that the maximum amount of money that it could possibly cost the Government, even if we assume that we will get a 10 per cent. increase in industrial exports and a 10 per cent. increase in coal production, is less than £10,000. It is quite obvious to me that, some time in September or October last, the Government panicked about its political position and Ministers were called together and told: "We have to produce some sort of programme. It does not matter whether it is a good or a bad programme, whether the propositions we put forward are likely to get results, as long as they look good." That was the whole purpose of all the announcements made by the Taoiseach-to produce something that looked good—and we have the proposal embodied in the Finance Bill, that means nothing, that will achieve nothing, and this proposal, which was obviously adopted without any consideration of its possible consequences much less of the need for it.
It is not easy for a Party in opposition to vote against a measure introduced by a Government in office to give money for nothing to anybody and Deputies will appreciate my political difficulty in that regard but, speaking quite frankly and honestly, I believe that this Bill introduces an undesirable principle in the operation of industrial policy, that it is unnecessary, that the aid which industry requires is not this type of aid and that the whole origin of the Bill is the inability of the Government to think beyond the surface of things, to get down to an understanding of the real causes which are holding up national development, their desire to appear to be doing something, whether they get results or not, in order to safeguard their political position for the time being.
The Minister can have his Bill, as far as I am concerned, but I want to make it clear that, in my view—and I may at some time in the future be empowered to influence Government policy—I think it has no importance whatever in relation to our industrial development and it represents a completely wrong approach to the problems of Irish industry as they exist to-day.
