The speech of the Taoiseach yesterday highlighted the fact that, although he levelled some very severe criticism at the main Opposition Party, he is prepared to accept advice from that Party and, in fact, that the Government are prepared to do so. This mini-Budget indicates that they are now accepting the principle of selective taxation in relation to their turnover tax. If Deputies cast their minds back, they will remember that we introduced an amendment suggesting that the Government should not impose the turnover tax on food and essential articles such as medicines, clothes, and so on. That was rejected by the Government and we voted on it. It is a welcome volte face that they are now accepting some of the principles we adumbrated here in relation to taxation.
The Taoiseach also levelled an attack against all and sundry who are criticising the Government. Is it not the function, and the principal function, of an Opposition Party to utilise opposition for the purpose of airing their views and to try to rectify some of the extremely stupid errors the Government have made and are likely to make in the not too distant future? They have made so many mistakes that I suggest to members of Fianna Fáil, who were so delighted when they heard the Taoiseach's statement yesterday that there would be no general election until 1970, that this statement is very likely to be at variance with the facts. It will not be too long, if they continue at their present rate of making mistakes, until the country is called on to give a decision as to whether they want to be led by the Taoiseach and his Ministers into national bankruptcy.
If my recollection serves me aright, the Taoiseach yesterday sat down about 5 o'clock. The Government at the time were negotiating, or had negotiated a loan to the amount of £5 million, according to Telefís Éireann. Apparently Telefís Éireann are privileged to get this information as a recompense for the services they gave the Government in the Presidential election by withholding any news in relation to the activities of Fine Gael, before Dáil Éireann is privileged to get it. It would seem to me that that £5 million is to be put to some purpose which the Taoiseach does not wish to be discussed by Parliament. It is certainly an insult to an Irish Parliament that they should be told nothing about negotiations which are going on while the Taoiseach is making a speech on national matters.
There is no doubt that all our difficulties, industrial unrest and the spiral in the cost of living, have their origin in the turnover tax. The Taoiseach talked yesterday about the difficulties in the administration of a selective tax. I do not think that the Government are having any difficulty with the turnover tax as it is. The Taoiseach spoke of discussions with the interests concerned. The interests concerned are the business people in this country and, in actual fact, there are no discussions with the business people in relation to the present turnover tax. Instead, the country is honeycombed with inspectors and every shopkeeper is being approached by some junior official who comes down to him and has the power to take away his books. Because of this, business people are unable to submit their books to their auditors for auditing.
These officials then send down a peremptory demand for so much turnover tax, and if the trader does not pay at once, a writ is issued straight away. People in my constituency have had four and five writs, and if they cannot produce an itemised account, which they have neither the staff nor the time to produce, they are going to be brought into court and fined £20 on each charge. There is no appeal against that fine. It is mandatory on the district justice to impose such a fine and there is no appeal against it. I am beginning to think that this is another way of obtaining revenue for the Government. If they round up every businessman and force him to produce itemised accounts, they are going to have a pretty rich harvest of fines of £20 all round.
Some Government speaker should give some clarification of what the Taoiseach meant when he said that discussions are to take place with the parties concerned. If they are using such arbitrary methods already, I fail to see what discussions they can have in view with regard to the new selective tax. All the troubles in which this Government find themselves, the industrial unrest, the spiral in the cost of living, the forcing of small business people out of business, are due to the turnover tax and to nothing else. It is unsuited to this country.
It is all fine for Government speakers to bleat about Government expenditure. They say that every tax they put on is to increase social welfare payments but what about the money they have wasted? What about the hordes of officials they have all over the country who are falling over one another? Expenses are going up all the time and the plea is that the Opposition are voting against increased taxation because they are trying to do the social welfare classes out of their lawful due. The Government have gone wild in their spending of money: they have wasted money. I do not want to mention names but there is a firm in Dublin which is supposed to be building aeroplanes and it has not yet put an aeroplane in the air. That company got a lot of money from this Government, certainly more than £1 million. Certain industries are being subsidised to keep them in existence, industries that were never solvent, and the Government would need to take another look at their policy in this regard.
Another difficulty in which the Government find themselves is entirely of their own making. They are short of capital, shorter perhaps today than in any time in the past. There may be certain reasons for that. Perhaps money is difficult to borrow at the moment, due to the fact that there is heavy pressure on the different areas in which it may be borrowed, the hard sterling area and the dollar area. Both of these areas have heavy commitments, and in the hard sterling area, one has to be able to put up a very sound security to get a good loan or to get a loan on reasonable terms. Apparently that area is not open to us now, which means that we have to look for money from other sources.
In the past, this country was largely dependent for its borrowing on the savings of the people. Perhaps some member of the Government would now explain to me why we are short of these savings. I am going to give the reasons why I think we are short and if there is anything wrong with my reasoning, I would like to hear it corrected from the Government benches. As a rule, national expansion in most countries is dependent on small savings. More is got from them than from any other source. In fact, most countries have built up their economies on the small savings of the people. Today our small savings are practically non-existent. I forget what the actual figures are which were issued some time ago. They showed our small savings have considerably dwindled. That is one source entirely cut off.
Why are there no small savings? The reason is that the people who could save are taxed out of existence. Further, when they come to the time at which they might be able to avail of State benefits, such as old age pensions, they are promptly cut off from them. If a person saves a few hundred pounds, it is immediately taken into account in a means test and he does not get the pension. There is no encouragement to save for the type of people, be they white collar or manual workers, who in the past saved their money in the Post Office or bank. That money was used for the purpose of national expenditure and development here. It is non-existent now. I suggest to the Government that they relieve such savings from a means test in any shape or form so that at least we may get back to the original small savings of the people, which will constitute a considerable sum.
If you look slightly higher up the financial scale, you find the people who save through building their own houses, insurance policies, annuities and other small investment in the country itself. They constitute, shall we say, business and professional people. The revenue from them is down too as a result of legislation, and retrospective legislation, the most dangerous and deflationary form of legislation. Anybody who buys his own house or has an annuity or an insurance policy will find it absorbed in death duties now. That is one of the things we cannot realise in this Parliament. Just because someone at the beginning of the century introduced that system here, which was suited to the United Kingdom at the time, we have accepted that. That is one of the things militating against saving.
The small sums we save by docking people who draw a State pension or social services to which they are entitled, or the relatively small sum we get from estate duty create inhibitory conditions. Until we get back to a firm basis of national saving again, we will not have any real production here. We will not expand national production by travelling around Europe looking for loans at a high rate of interest or by floating big national loans every year.
This country owes £714 million in national loans already. What has the country got to show for it? We have a dwindling population, with emigration and unemployment growing every day of the week. That unemployment is offset in official figures by the fact that the people just up and go off to England. Recently, due to some of the financial regulations made effective here, production in certain firms in Dublin has been considerably reduced. Those people have been forced to leave the country. We are not on a fundamental economic basis.
Before I conclude I should like to say a few words on the Common Market. A journalist from this country recently went to Brussels and investigated the situation there from a news point of view with regard to the Irish application for membership of the Common Market. We have been led to believe—if anybody believes the somewhat wild and woolly statements the Taoiseach gives in reply to Parliamentary Questions here—that Europe is waiting to welcome Ireland into the Common Market. This journalist who made this exhaustive research in Brussels, was right when he dispelled the illusion that everybody is waiting to welcome Ireland in. He also dispelled the illusion many people have that it is only a matter of time before the United Kingdom goes into the Common Market. Further, he dispelled the illusion—and this is the point—that if the United Kingdom get into the Common Market, the door is wide open and we will go in the next day.
I do not think this Government have ever seriously made any attempt to prepare for the Common Market. It is true they made a recent Trade Agreement with the United Kingdom with the idea of showing that we were preparing ourselves for free trade. It is crystal-clear that if the United Kingdom goes into the Common Market, that Trade Agreement goes overboard straight away. Where are we then? What preparations have we made to face whatever comes? What trade have we to look for to offset the trade we will lose with the United Kingdom? I do not accept that the be-all and end-all of our trade is based on sales to the United Kingdom. Anyone with any sense must realise we are largely dependent on what trade we may have there. But we have placed ourselves in rather a parlous condition in that we have never seriously looked for trade anywhere else.
Trade is wide open in the world today. We are not the only new country. We have a national Government now for over 40 years. Many other countries have come on the scene since then. Their number runs into three figures. They have concentrated on searching for markets. They have not adhered solely to the original colonial power, which may have been the United Kingdom or France, or whoever it was. They have gone out into the world and looked for trade here, there and everywhere. That is what this country ought to be doing, instead of having these negative statements from the Taoiseach that it can be assumed we will be in the Common Market by 1970.
This country ought to be out at political level looking for markets, as every other country is doing. It is the only way you will get negotiated treatment and agreement and bring about a better balance of payments. There is no use sending civil servants abroad. I have nothing against civil servants. They do their job as well and as thoroughly as they can. The embassies do their job as well as and thoroughly as they can. But they have no negotiating power. On the continent of Europe, where we want to look for trade, the people who count are the elected representatives. A backbench Deputy in Europe carries more influence and standing than the highest civil servant. The Government should wake up to this. Unless they do we are going to be left. Our economic and fiscal condition at the moment is not a happy one. If we suddenly find there may be revolutionary changes in the composition of the Common Market or if we suddenly find that the United Kingdom is in the Common Market, where is our Trade Agreement or the special arrangements we have with them? We know the answer; we have had it twice in the past two years. We got it with the 15 per cent impost which they applied to rectify their balance of payments and every political correspondent acknowledged that we had got the hardest knock from the percentage view than anybody else. On top of that, we had the restriction of credit which the Minister for Finance denied was going to have any material effect on our economy. However, the other day he explained that it was one of the things which had placed us in our present difficulty.
This Government want to start thinking quickly. Are they going to continue what they are doing, which is to try to collect money here and there, wherever it is, to stay in power and keep the wheels of commerce, such as they are, turning? They cannot go on in this way indefinitely. This country wants a new policy and a new outlook. In fact, it wants a new Government. According to what the Taoiseach said yesterday, the boys are going to be over there in those seats until 1970—but I am sure they will be over here—but I doubt it unless the Ministers of this Government come together and formulate a new policy. They will have to form a new policy in regard to agriculture—which is feasible at the moment because greater opportunities exist for agriculture today than for the past 40 years in regard to securing markets—and also in regard to our economy. If they do not do that, we are going to sink into chaos, with rampant, rapidly increasing unemployment, financial difficulties and industrial unrest which nobody will be able to put right.