It was coupled with something else. During the past 18 months, it must have been abundantly clear to the Government that public feeling was high in regard to prices. Yet they did not appear to be concerned or to take any positive steps to halt, where they could, the increases in prices. It is true that some items were investigated by the Prices Advisory Body, such commodities, important in themselves, as soaps, jams, and tinned foods. The Government used the power they had to investigate and to prevent an increase in the price of bread and flour. They prevented also, after an inquiry, an increase in the price of sugar. The Taoiseach had merely to open his mouth at the Fianna Fáil Árd Fheis and the petrol companies decided they would not increase the price of petrol, which showed it could be done and which showed also that the Government were in favour of price control to some degree. One of the criticisms, a legitimate criticism, of the Government was that they did not even attempt to create an atmosphere which would ensure that there would be no undue price increases. They did not attempt to create a price consciousness, so much so that, as Deputy Cosgrave said, there has been a free-for-all over the past 18 months and people were encouraged in that free-for-all by the various statements made by Ministers of the Government.
When the turnover tax was introduced, we were, of course, told that competition would ensure that price increases would not become excessive. This was the stock reply every time we raised this question. One Minister—he was Minister for Justice at the time; he is now Minister for Agriculture— was so foolish as to say that, as a result of the introduction of the turnover tax, and the competition that would result, prices would be reduced. He was altogether wrong in that. It was, of course, inevitable that price would increase following the introduction of the turnover tax and, in view of the fact that this tax was a budgetary proposal and was given the force of law, there was, I suppose, justification in a trader seeking to compensate himself for a tax he would have to collect and pass on to the Minister for Finance. Being human — perhaps that is a bit too complimentary—they naturally put on a little extra.
It is not unusual, too, after a wage round for prices to go up to compensate those who have to meet the increased wages. Again, advantage was taken of that situation as it was taken in regard to other taxes, and particularly the turnover tax, to put on exorbitant increases. This was generally recognised by everybody and it must have been recognised by the Minister and the Department of Industry and Commerce. Once again, they decided to let things go along and "competition will ensure prices will not increase unduly".
Our concern today is not a newfound concern. Just before the operation of the turnover tax, the late Deputy Norton on 23rd October, 1963, queried the Minister for Industry and Commerce in relation to possibly unjustified price increases following the introduction of the turnover tax. The Minister replied—this may have been the first time —"that competition would guard against that." We were concerned once more in the month of December, 1963. Deputy Kyne, on behalf of the Labour Party, moved this motion:
That Dáil Éireann is of the opinion that, in view of the many recent increases in the prices of essential foodstuffs and services, and in view of the fact that no satisfactory explanation of the necessity for such rises in prices is available either to Dáil Éireann or to the general public, the Government should without delay set up, under the Prices Act, 1958, machinery for the public investigation and, where necessary, control, of any such increases in the prices of essential goods and services.
This motion was accepted by the Minister for Industry and Commerce.
Surely, when he accepted a motion like that, he must have had in mind the fact that he was going to-take some action. We had assurances by him at that time that there would be investigation. He said he would be ruthless in that investigation and, if he found anybody increasing prices unduly or without justification, there would be prosecutions. I wonder were there any prosecutions in the past 18 months?
He also said he would make an order for the display of prices in relation to certain commodities in accordance with the power he has under the Prices Act of 1958. He said—this is his phrase—he would not hesitate to take action. He took very little action in the past 18 months. He seems to have been operating in accordance with Government policy. He talked about restrictive practices and collective price fixing. Of course, this is the usual method of fixing prices, contrary to what the Minister for Justice and the Minister for Industry and Commerce believed—that competition would keep prices at a proper level or, perhaps, bring them down. Certain traders do not operate like that; they collect together in the cities, provincial towns and villages and decide what the prices will be of this, that or the other commodity.
As far as I can gather, over the past 18 months, the Minister for Industry and Commerce did not find one single case in which a trader, or traders, could be accused of collective price fixing. Under the Prices Advisory Body, very few commodities were investigated. In any case, even though the Minister accepted that motion, little or nothing was done as far as price control and the powers he had under the 1958 Act were concerned.
The Government were warned by the Irish Congress of Trade Unions in May, 1964. The Congress called for effective machinery for price control. The Minister replied in volume 210, column 302 of the Official Report of 2nd June, 1964:
... free competition provides the most effective means of controlling prices and ... statutory price control is effective and practicable only in times of commodity scarcity, or when rationing is in operation.
On 27th May, 1964, at column 227 of volume 210 of the Official Report, the Taoiseach refused to state what Government policy was in regard to price control. In the meantime prices continued, and are still continuing, to rise and, as described by the Taoiseach, the Consumer Price Index rose from 164 in mid-November, 1963, to 180 in mid-May, 1965. There was an increase of 16 points, or ten per cent. The Budget increases of this year will, I am told, mean an increase of 11 per cent since mid-November, 1963.
The National Wage Agreement has been mentioned in this debate. It was mentioned in the Taoiseach's speech today as it has been mentioned in many Ministerial speeches since the Agreement was entered into in January, 1964. The Government have not been very consistent about this. I read a speech delivered recently by the Minister for Health in which he bemoaned the fact that more than eight or nine per cent was given in the ninth round. The Taoiseach, at least, was fairly clear when he spoke on 12th February, 1964, at column 862 of volume 207 of the Official Report. He said eight to nine per cent would be enough but the balance of four per cent was "worth paying for the sake of a national agreement", assuming, he said, that the four per cent growth rate in national resources would be reached. Now, the four per cent growth rate has been reached and has been maintained since the National Wage Agreement. Last year, it was 4.3 per cent. The Taoiseach has also said that the growth rate would be maintained this year. I shall not hold him responsible if it is not maintained. If things have happened since he made that statement, that is a different matter, but, in any case, on these two occasions he painted a very optimistic picture. From what he said, it is apparent that the National Wage Agreement, which gave workers and salary earners an increase of 12 per cent, was fully justified.
Industrial production in 1964 was up by 6½ per cent. For the first quarter of this year, it was up by four per cent. What will happen for the rest of the year is anybody's guess. According to the Taoiseach, it will not increase for the remainder of the year. The 12 per cent increase is blamed by public representatives, but not in public because workers have votes. There is, too, a tremendous amount of criticism by unthinking and ignorant people to the effect that prices have gone up because workers got an increase. That, of course, is a gross exaggeration. We are the first to concede that the increase certainly has a bearing on the cost of living but let it be said here once more that it is responsible for between 25 and 30 per cent of the increase in the cost of living.
This important thing should be mentioned also, when people talk about productivity in industry. There have been no increases in wages since the National Wage Agreement in manufacturing industries; there has been no change of hours and no change of conditions. People are inclined to be stampeded when there is a strike and when they look in retrospect over the year, even the threat of a strike stands out in their minds more or less as a strike that actually happened. I do not want to go into the merits or demerits of the last two strikes. As far as the building strike is concerned it did not, as far as the building trade union movement was concerned, break the agreement. That was a demand for improved working hours and the employers knew about this before the actual agreement was made. That reservation was made when the National Wage Agreement was being put before the Irish trade unions for ratification.
People should appreciate the terms of the National Wage Agreement. One of them was to the effect that in special cases wages could be reviewed and again, without mentioning any particular industries, I do not think it would be unreasonable for either side to expect that where a wage was unduly depressed, even within that period, the workers concerned would seek to improve their conditions. I do not think it was expected that workers who, say, had £9, a week when this agreement was entered into would continue at £9, plus 12 per cent. These are status increases for lowly-paid workers and I think employers' organisations knew that this class of demand would be made even though the National Wage Agreement was in operation for that period.
In any case, I think Deputy Cosgrave was right when he was talking about the status increases given by the Government. I do not know what the justification is. The Minister for Justice at one time tried to justify an increase to judges on the plea that it was a status increase. What it has meant in the Civil Service I do not know. I do not say the Taoiseach is overpaid or underpaid. Probably, with the recent increase, it is not such a bad salary. I shall not comment on the amount of work he has to do for it. But the public are disturbed by reason of the huge—what appear to be huge— salaries certain of the civil servants have and I assume that in the past 12 or 18 months, increases have been given to people who have been described in recent newspaper issues as being in a very high income bracket, even within the Civil Service.
The National Wage Agreement was made in good faith and on the assumption that there would be stability in prices for the 2½ years duration of the agreement. It was a voluntary agreement, a voluntary wage restraint by the workers in consultation and agreement with the employers but it was not unreasonable for them to assume that steps would be taken, if not by those people who control prices, by the Government, to ensure stability of prices.
Let me quote the Taoiseach as reported in volume 206, column 1216 of the Official Report. He said, speaking of both parties to the agreement, that he found——
...genuine concern in both parties to the agreement to fix the level of increases in this ninth round at a point which would bring the maximum benefit to workers in the form of improvement of their real earnings, in stability of prices, in the growth of employment and in the national interest.
Of course that has not happened. I know many people tend to exaggerate the increase in prices. You meet people in the shopping centres who will tell you that the cost of living has gone up 50 per cent. They believe it because so many things have gone up. They have an exaggerated impression that prices have gone up by much more than is actually the case. In any case, prices did not remain stable and that is the reason for the feeling of unrest there is among people at the present time. Workers got 12 per cent; the cost of living has gone up by about 11 per cent and that is a big bite into the 12 per cent. Again, on the understanding that this is to last for another 12 months, I think it would not be an unreasonable forecast to say that the cost of living will go up again and again and again until the tenth round is put into operation.
The Taoiseach should have an idea of the mind of the trade union movement in regard to the National Wage Agreement. This was the first, let us say, experiment, and it worked reasonably well. Where it did not work, these cases were absolutely exaggerated. The Taoiseach himself, or Deputy Cosgrave, conceded today that by and large the National Wage Agreement was successful but there may be a different temper in the minds of the unions and their members when they contemplate another wage agreement. There will have to be some clause, some qualification in regard to prices. There is no doubt in my mind in that regard. They will be reluctant to enter into a wage agreement where there is no firm assurance that prices will be controlled in a reasonable way.
There is no point in repeating what Deputy Cosgrave said and the figures and statistics he gave. He described the increases of 40 per cent in clothing and six per cent in housing and the increases in drink and tobacco. All these items have gone up and that affects ordinary people very considerably from day to day and week to week. Therefore, this action by the Government is long overdue. The Government have said what is being done. I should like to know if it is intended to go back to, or over, any period and investigate prices that have been increased and which, in our opinion, have not been justifiably increased.
I do not know in any piece of legislation, or in the Interpretation Act of, I think, 1937, of a definition of contract of service. We want to know where we are going. It is not defined in this Bill. I do not see it clearly defined in the Social Welfare Act but everybody assumed it to mean wage or salary employment. It is, however, defined, I found, after a long search, in a leaflet issued by the Ministry of Pensions and National Insurance. Contract of service is pretty clearly defined there and to my mind, it means employment for wage or salary at hourly, weekly or monthly rates but I should like to settle in the minds of members of the Labour Party that it means in fact what I have just said— and that it is not, let us say, a wages standstill order.
The Taoiseach who was Minister for Industry and Commerce in 1958 introduced the Prices Bill which subsequently became an Act which he said would be pigeonholed until needed. It was pigeonholed for a very long time. Are we to assume that this piece of legislation will get the same treatment? I assume from the remarks of the Taoiseach that it will not. Perhaps he would also tell us if the Minister for Industry and Commerce has not sufficient powers under the 1956 Act. I think he has pretty extensive powers. There were certain exclusions which, understandably, could be controlled only in consultation with the Minister for Agriculture and, I think, some other Minister also. Probably the machinery was too slow. I was encouraged by the remark of the Taoiseach that it was intended to freeze prices, pending investigation, even though it is only permissive. I think he should make a firmer declaration than he made to that effect. If it is considered that the price of an article is excessive, the price should be immediately frozen at what it was on a certain date before the increase.
I know that the Government must take the first step and make an Order to give the Minister for Industry and Commerce power to act. I do not know if this is a cumbersome method or not. I assume that in present circumstances there will be an all-embracing Order giving the Minister for Industry and Commerce all the powers he needs to investigate a case within the terms of this Act. Perhaps the Minister for Industry and Commerce will, if he speaks on this measure, spell out the terms of it and say what exactly the various sections mean. There is provision here to inquire into a service or services. Would the Minister for Industry and Commerce let us know whether these include hotel charges, haircuts, doctors' fees and so on? We would like an example or definition of service or services. The Taoiseach also mentioned that the Minister will have power to inquire into service work or works. We would like a breakdown of that, and to have examples, and also with regard to the processes mentioned in the Bill.
The Minister has power to requisition information, records and documents. He will have to have this power if he is to make full inquiry into the prices of various commodities but we would like to know what kind of machinery he proposes. I am not at all enthusiastic about the secret machinery which operates in the Department. The public will have to be assured that something is being done. The Government will have to have public confidence in these investigations, no matter what the outcome of them may be, no matter whether there is a reduction in price or not. Perhaps the Minister will also say if the prices advisory committees are now defunct and if these investigations will be carried out by officers of his Department.
We believe that one of the important things in this whole business is that there should be a public inquiry and that there should be a report to the public on the findings of such inquiry. The very inclusion of a suggestion of that kind in the Bill would be a deterrent to unscrupulous people and would prevent them from increasing prices unduly. After all, wages and salaries are negotiated in public in the Labour Court. The worker has to give evidence to show why he should get increased wages and in present circumstances, if somebody proposes to increase the price of a commodity, he should be required to justify that increase in public.
Somebody may get up here and say that a Labour Court decision is not final, but, for the information of those who do not know a lot about it, it should be made clear that over 80 per cent of the Labour Court's recommendations are accepted by the workers and the employers. That is a pretty high percentage and it shows that even though the Labour Court has no power to impose a decision, there is that great respect for the recommendations of the Labour Court. The main point I wish to make is that if workers have to go to the Labour Court and justify their case for an increase and if employers have to go there and justify their reasons for a refusal, it is not unreasonable that those who seek an increase in prices should be required to go before a public tribunal and that the Minister should have the power and should be willing to make the report of that tribunal available to the public.
I trust that the power in the Bill to freeze prices will be operated with respect to all price increases. There should be an obligation on people to justify increases in prices and services. Perhaps the Minister will describe the internal machinery that will ensure that price increases will be known by his Department in the shortest possible time. People can get away with the loot for months and months because others are too lazy to report it to anybody. Even the Minister for Industry and Commerce, when questions have been put down by Deputies asking about increases in prices, say, in the price of soap, says that he has got no complaint about the matter. He has given that reply on several occasions. If he has no effective machinery to recognise price increases within a reasonable time, there should be an obligation on retailers and manufacturers to notify to him their intention to increase prices.
We believe that the period of six months mentioned in the Bill is too short. That may be a note of optimism on our part in regard to this whole business. If the Government make an order which is to remain for six months empowering the Minister to inquire into the price of certain commodities, a period of a month or perhaps two months will have elapsed before that inquiry is completed so that if he makes an order, then it falls within the next four months. The Minister could operate much better if the Government's order was for a period of 12 months and if the Minister had power to impose his own order for a period of 12 months. If the Government had power to make an order for 12 months, it would give the Minister a longer period in which to operate it.
There is provision in the Bill empowering the Minister to ensure that weights will be specified so that price increases will not be disguised by a decrease in weight. Would the Minister consider taking power to ensure that if a price increase is refused, the quality of the product will not suffer? I think it important that the Minister should specially consider that quality will be covered in the Bill. I would also ask him to tell us if the exemptions in the 1958 Act with regard to transport, provision of water supplies and other matters will apply to Part III of this Bill. We support the Bill and trust that it will be operated effectively and speedily and we are encouraged by the assurance of the Taoiseach that prices will be frozen before an investigation begins.
