Dáil Éireann díospóireacht -
Tuesday, 24 Nov 1964

Vol. 213 No. 1

Committee on Finance. - Imposition of Duties (Confirmation of Orders) Bill, 1964: Second Stage.

Minister for Industry and Commerce (Mr. J. Lynch)

I move that the Bill be now read a Second Time. The purpose of this Bill is to confirm nine Orders made during 1963 under the Imposition of Duties Act, 1957 and the Finance Act, 1962. It is a statutory requirement that such Orders must be confirmed not later than the end of the calendar year following that in which they are made.

The first of those Orders, No. 132, extended the scope of the customs duties on bars, rods, angles, shapes, sections, sheets and plates of iron or steel. The Order imposed minimum specific rates as an alternative to the ad valorem rates except in the case of sheets and plates, which are subject only to ad valorem rates of duty. The duties provide protection for a range of rolled steel products manufactured at Haulbowline, Cork.

The next Order No 134, amended the customs duty on wood so as to bring within its scope certain planed or dressed boards and planks of soft wood. In the reclassification of customs duties in the Brussels Nomenclature, the duty on these boards and planks was inadvertently removed, and it is necessary to restore the duty for the protection of the home industry.

The Order numbered 135 exempted tinplate from the scope of the duty on sheets and plates of iron and steel to which it had inadvertently become subject under the Brussels Nomenclature form of customs classification.

The five Orders numbered 136, 137, 139, 140 and 141, were made in accordance with the recommendations of the Industrial Development Authority. The first of these, No. 136, reduced the minimum specific duty on drinking glasses, other than drinking glasses of crystal. The next Order, No. 137, reduced the customs duty on wooden furniture. The third Order, No. 139, reduced the customs duty on certain kinds of floor tiles. Order No. 140 reduced the customs duty on certain textile floor coverings and the fifth Order, No. 141, reduced the ad valorem rates of customs duty on thread and ply-yarn of flax and on single yarn of flax in ball form.

The last of the Orders for confirmation, No. 142, effected a second general reduction of 10 per cent in the level of industrial protective tariffs. This was in pursuance of the policy of providing an incentive to industry to re-adapt itself and to prepare for freer trading conditions.

An explanatory memorandum has been circulated for the information of Deputies and deals in more detail with the Orders. I shall be glad to give any further information which may be required.

Mr. Cosgrave

Would the Minister say, where duties are reduced or varied under the procedure of this legislation, is any investigation or scrutiny carried out by either the Prices Section or any other section of his Department as to the effect on prices? In other words, is the effect of the variation of duty or the reduction, as the case may be, taken into account in considering price changes?

Mr. Corish

I should like the Minister to tell us something about Order No. 132 mentioned in his speech. This is in respect of the scope of customs duty on bars, rods angles, shapes, and so on. I assume that the duty to be imposed is at the ordinary rate and includes the two ten per cent reductions. As regards Order No. 134 and the rest of them, I assume this is to bring the goods back under the umbrella of protection which was inadvertently removed from them in recent times. I suppose there is no necessity for the Minister to confirm what was said here about two weeks ago, that another reduction of ten per cent in the level of industrial protective tariffs is not anticipated next year.

It seems a little peculiar that we are thinking in terms of the imposition of duties when a few minutes ago we were talking in terms of free trade and the decontrolling of investment by industrialists and others in this country. Frankly I am worried about the rate of the reduction of tariffs. Maybe it was a good thing and a good excuse for the Government in their present circumstances that they found it necessary not to go ahead with the further reductions. The first ten per cent and the second ten per cent did not make much difference to Irish industry but I would say the next ten per cent, irrespective of the 15 per cent surcharge, would have hit—I will not say a whole lot — a fair number of Irish industries. Maybe, it was a bit premature for the Minister to tell us what will happen between now and 1970 but I do not think Irish industry and the workers should be made to suffer more than they need in anticipation of our going into EEC.

Again the Minister or anybody else cannot be quite certain what will happen but I assume in any case he will, over the next year or two, keep a close watch on the effect of the reduction of these tariffs on certain industries. I do not think the Minister can just look at industry as a whole and tot up the number of employed in it and the amount of production. He will have to have regard to individual industries in various parts of the country because the process of stripping ourselves of protection that was built up for so long and that was so necessary is very severe over a short period of five or six years.

Mr. J. Lynch

In regard to Deputy Cosgrave's question as to whether the Prices Section of the Department of Industry and Commerce are consulted in regard to the effects of the tariff reductions, normally they are not. In fact I do not think in any case they have been. These tariff reductions are, as the House is aware, recommended by the Industrial Development Authority after a request made under the terms of our Anglo-Irish Trade Agreement. The Industrial Development Authority are bound to have regard to the effect the reduction requested or made would have on Irish industry and on employment in Irish industry. Their terms of reference are specific. Reasonable protection must continue to be given to Irish industry, at the same time providing for reasonable competition for imported goods. In all cases a searching examination is carried out into the effects that any tariff reduction of this nature might have on Irish industry. This examination usually goes on over a period of some months during which Irish industrialists, people concerned in the manufacture of the goods involved, are given ample opportunity to make whatever case they wish.

The first question asked by Deputy Corish was in respect of Order No. 132 which imposes a minimum specific duty or an ad valorem rate on certain goods which Irish Steel are preparing to make. At the moment that duty is in the main suspended until such time as Irish Steel goes into full production. The ad valorem rates apply only to sheets and plates but the specific rate is £30 per ton on other items.

Mr. Corish

The Minister says the specific duty is £30 per ton. What is the ad valorem duty?

Mr. J. Lynch

Thirty-seven and a half per cent full, 25 per cent preferential.

Mr. Corish

If the two ten per cent reductions had not been made in the past two years, what would they have been?

Mr. J. Lynch

The Deputy is asking me to do sums at this hour of the night.

Mr. Corish

It is this duty, less the two ten per cent reductions?

Mr. J. Lynch

It must be.

Mr. Cosgrave

Is it not stated at the end of the Minister's memo that the rates of duty mentioned in the memo are gross rates and do not take account of the reductions made in January, 1963, and January, 1964?

Mr. Corish

Is this the rate, less the two ten per cent reductions?

Mr. J. Lynch

No; it does not take account of them.

Mr. Corish

Why would they have been excluded? Would they not have been subject to the global reductions?

Mr. J. Lynch

I think the answer there is that the ten per cent has been applied in the global reductions we mentioned in Order No. 142. The two ten per cent reductions are affected in No. 142 and were across the board and would reduce the rates mentioned in Order No. 132 when applied.

Mr. Corish

Across everything?

Mr. J. Lynch

Yes.

Mr. Corish

It has been applied to Irish Steel Holdings as well?

Mr. J. Lynch

Yes, but the Deputy will remember that this duty is still suspended, pending the completion of the plans of Irish Steel to get into production of these commodities.

Mr. Corish

Will the price be right?

Mr. J. Lynch

We hope so.

Mr. Corish

To the Irish foundries?

Mr. Moran

We all hope it will.

Mr. J. Lynch

I have been encouraging the Irish steel foundries and Irish Steel Ltd. to get into discussion about the price, hoping that it will afford Irish Steel, first of all, a reasonable protection and the Irish foundries and Irish steel fabricators a reasonable opportunity of competition.

I was about to reffirm, in answer to Deputy Corish, that the decision not to impose the ten per cent reduction on 1st January next still applies and will continue to apply until the Government have assessed the situation. I also stated, on a previous occasion, that it was the intention, and still is, that when the next ten per cent reduction is to be made the Government will then have a look to see what our position is generally and, in relation to particular industries, to see how they can withstand any further reduction, if such further reduction is decided upon.

Mr. Corish

Could the Minister confirm or deny whether the two ten per cent reductions have had any appreciable effect on Irish industry?

Mr. J. Lynch

They have, yes.

Mr. Corish

An adverse effect?

Mr. J. Lynch

An appreciably good effect.

Mr. Corish

I did not want the answer to be adverse.

Mr. Cosgrave

There will be no question of a further reduction as long as the levy lasts at any rate?

Mr. J. Lynch

Oh, no.

Question put and agreed to.

An Leas-Cheann Comhairle

Next Stage?

Mr. J. Lynch

There is some difficulty about this. For the first time I do not want all Stages. This is a Money Bill and I shall be away next week. If we passed all Stages now, being a Money Bill, it would have to go to the Seanad within seven days and I would not be there to take it.

Mr. Cosgrave

This day fortnight.

Committee Stage ordered for Tuesday, 8th December, 1964.