It is always interesting to hear Deputies make elaborate pronouncements about the heavy burden of rates, about how much the Central Government should bear of the cost of municipal and other services. They never propose the taxes that would have to be placed on the community at large if a greater volume of local authority expenditure were transferred to be the responsibility of the central Government. In fact, the Government have gone a very good distance, adding to the percentage of total local authority expenditure which is met by the central Government in successive years.
In the case of my constituency, the Government pay something between 62 per cent and 64 per cent of Monaghan County Council's costs for roads, housing, health and other services. This includes the total expenditure by the local urban councils at least, it cannot be said that the Government have been negligent in that respect. In so far as Monaghan is concerned, in the year 1966-67, the farmers were paying about five per cent more in agricultural rates on land than they were paying in the year 1956-57, and that was before the recent arrangements were made, which will be introduced this year, for a derating of farms under £20 valuation — another contribution by the Government towards relieving local authorities as far as possible from burdensome rates.
Undoubtedly rates in towns have gone up very much in recent years. I made a calculation to see whether there was anything desperately unfair about it and as the House knows, there is continuing inquiry into the whole rating situation, but it is significant to know that in 1965-66 compared with 1958, the total rates in the urban districts had not increased any more than the national income. Of course, that does not mean that everybody in the town experienced a rise in income equivalent to the national average but it means there was nothing extraordinary, no distortion, in the picture of rising rates even though they fall heavily on certain sections of the community. However, certain sections of the community have received social benefits of many kinds to meet that contingency.
I mention that in passing because one hears such irresponsible talk from people like Deputy Coughlan. He made all sorts of reckless charges, accusing the Government of corruption and saying that the Irish people could be intimidated by alleged corruption and that by intimidating them, they could be induced to support the Government. It was a very reckless charge made against what could be regarded as the ultimate integrity of our people. I was surprised to learn that Deputy Coughlan's opinion of the people is so low, as, I have no doubt, the people of Limerick will be surprised when they read of his allegations.
He suggested that the Government are associated with a vast amount of political patronage. It is just as well we should bear some facts in mind. There are only about ten countries in the living world where such a huge proportion of appointments in the central and local service are effected on the basis of merit, as are here. There are very few countries in the world where there are so few appointments which in fact are in the gift of the Government or on a political basis. That situation has been maintained and has not been altered in any way during the very long period in office of the Fianna Fáil Government. Long may it remain so.
Deputy Coughlan referred to certain appointments where he knows very well that whatever may be political aspects of the appointments, in general, the people who have a great deal of family responsibilities, in lower paid posts and who are fully qualified, get appointed regardless of their political affiliation. Deputy Coughlan should go abroad and he will undoubtedly realise how very proud we can be not only of the incorruptibility of the Fianna Fáil Government and their antecedents but of the relatively small amount of patronage that is exercised here. Patronage is inevitable in every democracy but whatever our problems, we need not be ashamed of our position in that respect.
Having dealt with Deputy Coughlan's scurrilous assertions and with his comparison of a contribution of £100 to political funds with the social welfare services, which went up by £1 million this year, I may now proceed to examine the Budget. I add my voice to those of other Deputies in rejecting utterly the ridiculous statements suggesting that the Government have for the first time come to the aid of the West because there are local elections impending. The Government, since they took office in 1957, and indeed in their previous periods of administration, but in 1957 after a period of unparalleled emigration and unemployment, have constantly provided increased State grants for production, have constantly stimulated the development of the economy and have come to the aid of farmers while increasing social services. These additions took place in practically every single year of our office since 1958 and have varied in quality and quantity. Aid has been provided for farmers, big and small, on a basis never before seen in the history of the country.
Total farm aid in all forms amounts to about £60 million this year. In 1956, it was at the level of £15 million or £16 million. That indicates very considerable progress. Aid is continued in regard to agriculture, to tourist capital development, to the promotion of tourism. It is continued on an upward basis for rural electrification, for the development of our roads and, as I have said, the idea that we abandoned the West until this Budget and that now we have contributed to some small extent, is utterly ludicrous.
I had occasion to go to Galway the other day to speak on a political occasion and I wanted to see for myself what had been done for the people of County Galway since 1956, the last year of the Coalition Government, in order to refute suggestions that were made there that Galway has been abandoned, that nothing has been done to bring economic and social development to that very typical western county. I found there were 20,000 farmers in the county and that since 1956, 20,000 acres of land have been added to the existing holdings of just about 1,600 small farms. That is a costly business, and it indicates progress in land settlement. We would like to have made more progress but that indicates a very considerable change in the structure of the farms in Galway in a period of just ten years.
We find that in Galway, for example, 22,000 acres of trees had been planted, that is, roughly 70 square miles of forests had been planted, again indicating a contribution to the county which can be illustrated in other counties all over the West. This is merely a typical example of the sort of contribution that has been made continuously during the past ten years.
The Government, through a wise policy, have surfaced the county roads. This is something which in fact I had the privilege of initiating back in 1946 when I was Parliamentary Secretary to the Minister for Local Government and it has resulted in the tar surfacing of 1,000 miles of county roads in Galway alone, since 1957 — again indicating very great progress.
I could continue in that vein for a long time, illustrating the progress which has been made and pointing out that some of the new incentives in grants and increases in the price of milk this year are all part of a continuous campaign to bring help to the small farmers in particular and to encourage economic and social development in the 12 western and northwestern counties. I wish we could find another name for the West because Cavan, Monaghan and Leitrim are included in the counties which urgently need development.
I was calculating the other day for my constituents the actual contribution in terms of cash by way of subsidies to maintain farm prices in my constituency. Including the amounts to keep down the rates on land and including the price supports for pigs — and Monaghan has seven per cent of the pigs in the country — and including the price supports for dairy products and the sow headage grants and the fertiliser grants, I worked out that the 6,800 farmers in Monaghan received help from the Government last year to the amount of something between £800,000 and £1 million. That was for one county.
Monaghan farmers have to work very hard. A lot of the land is rather cold and wet. They have to face all the hazards of wind and weather and they deserve that kind of aid because of the difficulty of maintaing farm incomes about which the House has full knowledge. Nevertheless, this indicates that the Government made some contribution to stimulate greater farm production and bring an economic income to the farmers. In a small county like that, the farmers who complain of the aid given would be in a very serious position if that £800,000 to £1 million ceased to flow into the county. I hope that more and more aid will be given in the future.
I do not think that a great many people yet realise the difficulty of transferring income from the non-farming community to the farming community in a country where we have not yet established sufficient industries. This was referred to very briefly in the magnificent Budget Statement of the Minister for Finance but it seems to me that it has to be repeated over and over again in the hope that just a few thousand more people will read what is said, appreciate it and understand the problems we have to face. We have pointed out that the incomes of the farming population have gone up by about 70 per cent per head since 1958.
A considerable amount of that increase is due to migration from the land. It is very interesting to read in the Report on Full Employment the figures for migration from the land for the OECD countries published in the appendix. We can see that migration from the land has proceeded just as rapidly in almost every other country in Europe as it has here and that it is a universal factor in economic development.
As I have said, the income of the farming population has gone up 70 per cent per head and the income of the rest of the community has gone up roughly the same amount, or perhaps a little more, since 1958. The difference in income between the two communities places us just about halfway down a list of a number of European countries. There are a number of European countries where the income per person in agriculture as a percentage of the whole economy is less than it is here and there are some where it is more. We are about halfway down the list. Naturally all of us would like to see us higher up in the list. I have the figures for some years ago only. Probably they have not changed very much. They may have improved slightly as a result of the coming into operation of the agricultural system of the European Economic Community. Non-farming incomes grow so rapidly that every country has found it impossible to bring the incomes of the farming community level with those of the rest of the community.
In a recent year the income of the Irish farming community per head was 68 per cent of the income of the average economy. The figure for Denmark was 73, for West Germany, 50 and for France, 51 per cent, showing again that we were in a comparable position. It is very unfair for people to deride the Government for not doing more to reduce the difference in incomes without at the same time pointing out that our industrial resources are insufficient. We have heavy taxation in order to shift the balance in the right direction. We have heavy taxation in order to provide price supports for the farming community which last year were valued at between £17 million and £19 million.
One way to examine this is to look at the non-agricultural resources available in the various countries to support an equal amount of agricultural output in each of the countries. Taking Irish non-agricultural resources as 100 —that is to say if you have 100 units of non-farming resources here to be taxed in order to transfer income to the farming community, what is the same number of units in a number of countries which have had their freedom for a great deal longer and many of which have more industrial raw materials and where industrial development has proceeded on a much more extensive basis than ours, although we are advancing — we find that in an agricultural country like Denmark which had the advantage of freedom at a very early stage, democracy and a splendidly run system of finance, although that appears to be an agricultural country they have twice the non-farming resources from which to transfer income to their farmers.
I do not want to give all the figures but the British have 8½ to nine times our resources; France has over three times our resources. This provides a very great problem for any Government earnestly desiring to break down the difference between the incomes of the farmers and the non-farming community. We can only hope that as industrial development continues steadily year by year and as tourist development continues, while we are not in EEC and have to find subsidies to aid farmers by supporting their prices, we shall have to continue this aid at an increasing pace. When we join EEC, there may be increases in our cost of living which, in itself, will be a kind of taxation, which will be of assistance to the farming community. I believe people ought to recognise these facts because they cannot be got around. Any Government who want to help the farmers will always have to look at the amount of non-farm resources which can be taxed. I said some time ago that if the cost of living goes up because of increases in the price of food and people want to remocrac compense themselves by having increased wages they may do so but they will find that the Government will almost inevitably have to tax them in order to find money to transfer to the farmers. I said we should not regret increases that arise in the price of food as a result of the farmers securing higher prices for their produce.
I was speaking of the increased grants and facilities offered in the Budget. I wanted particularly to speak on some matters which concern my Department. I am quite certain that, in certain regions of the West, tourism will play the greatest part in increasing the incomes of the people there and in attempting to stabilise the population. I doubt if the population of the West can be stabilised in the very near future. I believe the Government should do their utmost to provide centres of growth in the West by the stimulation of agriculture, industry and tourism in order to offer the greatest possible opportunities for employment so that the largest number of people possible will be retained in these western counties.
As I said, I think there are certain areas where tourist development will play a very major part. For example, I could mention the fact that in Counties Kerry and Cork, the tourist income in a recent year amounted to some £7½ million. The effect of tourist income is not immediately apparent. It is not like opening a factory and employing 200 people where the workers go every day and receive their wages at the end of the week. It is an all-pervasive income spreading over a large variety of people. If that income of £7½ million ceased in that area, then the people there would realise the immense value of the tourist industry for those two counties and, indeed, for the whole of the western counties in general.
In this Budget, we have provided very considerable increases in the grants for new hotel accommodation. We hope to channel these grants to a great extent to hotels and extensions of hotels in the western areas, that is, areas where development is required, where tourist centres would have still further help in expanding their hotel resources. The Bord Fáilte grant for accommodation development is being increased this year by some £200,000 to £700,000. We need some 2,000 extra bedrooms a year between hotels, guesthouses and private houses in order to achieve the target of a 100 per cent increase in the volume of tourist income based on 1960 prices. We are very nearly up to target. We are a shade off target as a result of the seamen's strike last year. This is a particular economic development which is up to target to a greater extent than any other that we have at present. I felt it was most essential to continue this development because it spreads money among a very large number of people.
The Economist Intelligence reported to Bord Fáilte — an Opposition supporter is very closely associated with that body — that about 160,000 people were directly or indirectly employed as a result of the tourist industry. The report indicated that the tourist industry has the effect of adding ten per cent to the population. If one assumed that the tourists remained here permanently, then it would be the equivalent to the income spent by an addition of ten per cent to the population. Tourism also has a very important effect on expanding Government income through taxation. Every £ spent by the tourist and every £ spent on development helps to provide income for State services and, in turn, for the development of the country.
I want to repeat, in rather more detail, what is being done this year to help in the extension and the growth of hotel accommodation throughout the country, particularly in the West. New hotels in the 12 western counties can now get, at the discretion of Bord Fáilte, grants of up to 35 per cent of total construction costs as compared with 25 per cent previously. One of the reasons for giving these increased grants has been the recent inflation, the growth of building costs, the cost of building new hotels, particularly in the remoter parts of the West because of the carriage of the materials. Another reason is the fact that the season is relatively short.
There are many places in the West with magnificent scenic amenities where it is simply impossible to get functional business in the winter and hotels and guesthouses may have to close even though the season is steadily growing. Quite a number of hotels in Connaught in completely isolated districts remained open last year until 15th November. Everything is being done by Bord Fáilte to extend the season so that it will be easier for hotels to pay their way and so that employment will be for a longer period. Hotels adding bedrooms in the West can qualify for grants of up to 50 per cent compared with 40 per cent elsewhere. New hotels, not getting total construction grants, can get 30 per cent grants in the West towards dining areas, kitchens, and so on.
Then there is the very essential development of caravan and camping sites. Bord Fáilte are going to register caravan and camping sites to ensure that they are of the right standard. They have been consulting with the Minister for Local Government to ensure that, from the point of view of sanitation, the standards are agreed. It is very important that caravan parks should not destroy the scenery. It is very important that they should be placed properly. It is very important that that should be done as a result of the decision of the local planning authorities. When they are placed, the amenities should be such as not to detract from the total appearance of the area where they are located. Bord Fáilte is giving a 50 per cent grant towards site development costs and that, again, will be a help in the West.
Guesthouses also can get grants provided that there are at least five bedrooms on completion of the work. Then, for some time, we have been considering what we could do to help farmhouse development. The number of farmhouses that offer accommodation to tourists has been growing steadily. I think the figure for this year will be something between 700 and 1,000 bedrooms. I cannot remember the exact figure but it is somewhere about that for the entire country. We have been trying to devise some method by which we can encourage farmhouse owners to develop their premises. The scheme will be announced later — costing about £100,000 this year. It will apply to the 12 western counties. I think it will be partly on a co-operative basis. Bord Fáilte will select an area where there is an attractive beach, lake or river, a tourist area, and then will arrange for some local development association to be formed. Having assessed the number of empty houses in good condition which could be let to visitors if they were improved and the number of houses in which visitors can be accommodated and catered for, they will set about making arrangements for providing assistance towards the better furnishing of these houses, providing furniture of a suitable kind so that visitors will be comfortable. At the same time, arrangements will be made for catering courses to be given where required, as is already done in many towns where angling development is taking place. At the same time, there will have to be an examination of the roads structure in the district. There may be a hostel built in the area. This is a scheme which has been tentatively worked out and may begin on a modest scale and may result in what for want of a better term we will call tourist centres being created. They will be created around a sufficiently good tourist amenity in order to attract tourists.
It has been suggested already, for example, that the Glencolumbkille area, where Father McDver is doing his splendid work, would be a suitable area for development of this kind. Bord Fáilte have been examining a number of areas in the West. I might add that they must have the choice of these areas. It is no good people pressing me to decide that some place should be included in the scheme. They are to be given the authority and they will have to begin on a modest basis and learn by experience what is the best method of development. Bord Fáilte have made a splendid success of the resort development scheme for which this year the grant has been doubled. They have improved amenities at a great many resorts and have certainly developed hotel accommodation on a successful basis. I have no doubt that they will use the same imagination and resourcefulness in going ahead with the farmhouse scheme.
The Budget also provides some urgently needed funds towards transport development of various kinds. For example, cargo has grown so much in volume at Dublin Airport that we need a complete new cargo terminal of the most modern type to carry the hugely increasing volume of cargo exported to other countries and imported here by air. As a result of the growth of Aer Lingus, we need an entirely new catering building at Dublin Airport. I mention these to illustrate the kind of developments that are taking place. I am very glad to note also that the estimated projection for traffic at Cork Airport has been grossly exceeded. We are extending the catering area at Cork this year, again an example of this Budget's contribution towards economic development.
I am also glad to announce that the credit squeeze which affected rural electrification development has been relieved in the Capital Budget and that the capital allocation for rural electrification in this year is nearly £2 millions compared with £1.3 millions last year. The halt that took place in rural electrification last year has now ceased and the development of this work will continue on a steady basis. The present scheme, we reckon, will end by 1970 and 1971, and we hope by that time a very considerable proportion of the entire rural community will have been joined to the network without having to pay extra fixed charges or will have to pay only a very modest increase in the normal fixed charge. As I stated to the House before, it is a fact that 96 per cent of all rural dwellers can be joined to the system without paying excessive fixed service charges, and if we are able to do that, we will examine the position of the remainder.
I can say, looking at the picture of Europe as a whole, that if by 1970 and 1971, we have joined 96 per cent of the people to the system, we will compare quite well with countries with an even higher standard of living and higher incomes per head than we have. That does not necessarily mean that everybody will want to join. Out of some 377,000 rural dwellers, there are 27,000 who could be joined to the system without paying any additional fixed charge. I merely mention that in passing. We are examining what we can do about the remaining four per cent about which I have had many representations in regard to people who feel they are living in areas where they are surrounded by people with electricity, who already have power, and who are offered connection at very burdensome supplementary fixed charges. We are going to examine that to see what can be done towards the completion of the campaign.
In this year's Capital Budget the Government naturally have to give consent to State companies engaging in capital development and I just want to mention how glad I am that the B & I have placed an order for a car ferry for the Dublin-Liverpool service. This will be a very fast vessel which will be able to do a number of trips each day. It will have seating capacity for 1,000 passengers and accommodation for 220 cars. The company are financing this project out of their own resources and have been permitted to engage in this capital venture which I hope will be successful. I should mention in passing also that the new bulk carrier for Irish Shipping of 34,000 tons deadweight will be delivered in October, 1967. The company's fleet will then consist of 14 dry cargo vessels totalling 162,000 tons deadweight and these vessels will include a high proportion of ships that are relatively modern. I do hope that Irish Shipping will be able to meet more successfully the very low freight rates that have existed throughout the world for the past few years.
Again, in connection with modern economic development, the capital grant for the Post Office telephone programme has been increased this year and I hope we will be able to go ahead with the laying of more cables and circuits, which in turn will enable more telephones to be installed and more exchanges to be converted to the automatic system. I might add that there has been an explosion in telephone development. The Post Office had to compete with other services for capital, there has been a fairly large number of applications on the waiting list, but other countries also have their waiting lists. The number has been fairly large here but I hope that we will be able to reduce it to 8,000 by 31st March, 1968. That would be a considerable reduction as compared with previous years.
I hope we will be able to deal with all the people who have been waiting for a very long time for telephones, particularly those in the country. I have continued to press the policy of my predecessor that we simply must not keep people in rural communities waiting because we know it will require more manhours to connect them than to connect people in the towns. People in the country, particularly those who are increasing production and who need the telephone for personal or social purposes, and people on the priority list, should be connected as rapidly as possible. I hope that programme will continue.
As I said, I wanted to show that in the case both of tourism and transport this Budget has given aid for further development and we are overcoming some of the backlog of work that resulted from the credit squeeze and the difficulties which our country and others encountered in the last two years. I particularly wish to speak also about the pilot farm scheme. We have not heard half enough about that scheme from Deputies on all sides of the House. Probably it will prove to be the greatest scheme of all for encouraging the ambitious farmer in our community to extend production and use modern methods. It is very interesting that the pilot farm scheme, by its success, has disproved a great deal of cynical comment that is made about Irish farmers in general. It is true that farmers here, as in the case of farmers in Scotland, are not particularly keen on the full-blooded type of Danish co-operative system and co-operative development, while excellent in many areas, has not proceeded on the same splendid basis as in Denmark.
It is true that the previous Minister for Agriculture and Fisheries strengthened the Irish Agricultural Wholesale Organisation Society in order to show what can be done to bring about the best from what I might call the full co-operative system which one finds in certain areas now. But a great many people would not have said it was possible for all the instructors and Government officials concerned with farm production to get neighbourhood groups together and discuss in common with them what could be done to improve production in their area, what schemes could be devised, how the whole area, apart from the individual holdings, could be improved so that there would be greater stock density and an increase in production. The scheme devised by the previous Minister for Agriculture has succeeded very admirably and I should like to stress the importance of the decision by the Minister for Finance and the Government that the pilot farm area schemes can be extended this year and I hope they will grow.
I was very interested in that connection to get some particulars of the success of the scheme in Galway county where in the pilot farm area no less than 11 neighbourhood groups were formed. In the one area some 607 acres of land were limed and manured through the fertiliser credit scheme and the capital fertiliser scheme by which the whole of the land receives capital, big application for fertiliser over a period of three years and the cost is put on the annuities. It is a scheme that is not publicised sufficiently and those members of my constituency who adopted the scheme found it of great value particularly in the case of a young man who inherits a farm which is badly run through the illness of the father or the indifference of whoever owned it before.
In the one parish nearly 2,000 tons of limestone fertiliser were applied apart from this capital application of fertiliser in respect of certain areas. Also, 82 farm building projects were completed in this single parish area. What was very interesting is that loans totalling some £20,000 were taken by the farming community and it was interesting to note that when farmers come together and discuss their problems and meet all the advisers and all those concerned with helping them, greater progress can be made than if they considered these matters purely separately and apart from each other. The success of the scheme indicates that the Minister for Agriculture can think more intensively on the same lines. The scheme is succeeding in my own constituency in the Aghabog area and I hope everybody will examine what is being done. The giving out of more credit is interesting because in the report from the rural economy division of An Foras Talúntais there was an analysis of the extent to which farmers took credit. The investigators found that incomes on farms where they had taken medium credit were about one-third higher than in the case of farms where no credit had been used. They also pointed out that in the western areas very little credit and very little money had been borrowed by farmers for productive purposes. One can see in practically every one of the pilot area reports a big increase in the amounts borrowed for productive purposes on the advice of all people concerned with the project.
Along with the pilot farm area scheme the Government have also provided more money for the Land Commission to see what can be done to improve the land structure in these pilot farm areas. One can notice in every one of these areas that there is considerable fragmentation of farms. The farms are scattered, but apart from what we call traditionally the rundale system, in a great many areas the farms are not compactly situated and there is also quite a considerable area in each of the pilot farm areas owned by people who are unlikely to make progress in farming, old people living alone whose children have gone away.
I was glad to see more money provided for the Land Commission in order to bring about growth in the size of viable farm units and to assist in ending or eliminating fragmentation in these areas. We have not been given the full details of the incentive bonus scheme as proposed by the special committee set up by the Minister for Agriculture, but again, that is a scheme to assist farmers to produce more and I hope it will succeed. I also hope that the scheme can somehow be integrated with the pilot farm area scheme.
Finally, I hope every member of the House will read from cover to cover the Report on Full Employment which I think in some ways is the most important document issued in this country since 1948. It is a document to which both employers and trade unions have subscribed and the most important parts of it are not the endless statistics which are of a purely speculative type in that the authors of the Report do not pretend to devise a plan for full employment, but the paragraphs which refer to the national attitude of our people towards development. They make it clear that no matter how perfect a Government may be in developing the economy and providing the necessary capital aids, providing education, retraining workers whose occupations must be changed as a result of inevitable changes in industry, that ultimately it will be the attitude of the people that will enable us to progress towards full employment. The Report refers to the necessity for a very great increase in productivity in industry and in agriculture if we are to see a sufficient number of our people employed in this country. It refers rather grimly to the fact that almost inevitably some 101,000 people will leave the land between now and 1980.
In making this statement the Report refers to the average rate of migration from the land in the whole of the OECD countries over a period of years. The Council members cannot see this inevitable migration from the land ceasing. They make a rough estimate of what they think it will be, which of course means that employment in industry will have to be accelerated. The report makes it clear that it is possible that money incomes will inevitably rise but if they rise faster than what would provide for competitive exports there is no hope of securing full employment.
In fact, the report confirms what a great many people, economists and Ministers of my Government, have been saying ever since the beginning of the inflation in 1962. I myself felt very relieved when I read the report prepared by trade unions, employers and others which confirmed the many realistic statements my colleagues and I have made about how perfect the position of this country was from 1958 to 1961 in regard to our being free of inflation. During those three years employment increased, exports increased and real incomes increased without any inflation.
