Before dealing with the financial resolution before the House it would be as well to have it formally stated that it has been agreed by both sides that although the resolution is on the wholesale tax it is, in fact, to be treated as a general financial resolution. Before dealing with it I want to say that people on all sides of the House are sorry that the Minister for Finance himself is not able to be here.
Committee on Finance. - Resolution No. 4: Wholesale Tax (Resumed).
Debate resumed on the following motion:
(1) That, with effect as on and from the 1st day of January, 1969, wholesale tax imposed by section 2 of the Finance (No. 2) Act, 1966 (No. 22 of 1966), shall be charged, levied and paid at the rate of ten per cent in lieu of the rate of five per cent specified in sections 7 (1) and 11 (1) of that Act.
(2) It is hereby declared that it is expedient in the public interest that this Resolution shall have statutory effect under the provisions of the Provisional Collection of Taxes Act, 1927 (No. 7 of 1927).
—(The Taoiseach.)
Hear, hear.
Although I have no hesitation in saying that politically he is the most dangerous Minister for Finance who has ever been here in 50 years, at the same time, we all wish him well and I hope he will soon be completely recovered from the effects of his accident. It is unfortunate that he is not here due to physical inability because it is undoubtedly a fact that he must bear the largest part of the burden, the largest share of the blame for the savage attack that had to be made by the Government on the people last week and by the Taoiseach in his position as Acting Minister for Finance.
Last May when I was speaking on the general resolution in the Budget I made it quite clear that in my view the Budget was not a genuine Budget and that it was not a Budget which our economy could support. The Minister for Finance, when he was replying to the Budget debate, at columns 1176, 1177 and 1178 of the Official Report for the 8th of May went out of his way to say that it was a serious, carefully planned Budget and he also went out of his way to jibe and jeer at me because I said that the Budget was one the economy could not digest. Of course, last week the Taoiseach proved that what I had said was correct and what his own Minister had said was absolutely incorrect. Not, of course, that that worries this Government very much; in fact, it worries them so little that I see we have not got in the House today that advocate of joint Cabinet responsibility, Deputy MacEntee, otherwise "Old Mischief". He has not even come in because he knows that Cabinet responsibility is entirely a thing of the past. Anybody who had any doubts about that could see it last week, unless, of course, there was another explanation, that the speech by the Minister for Agriculture and Fisheries in which he publicly snubbed his Leader was deliberately designed for the purpose of distracting public attention from the referendum results and from the mess the Government have made in the country's finances as culminated by the Budget of last week.
In any event, whatever it is and notwithstanding the comment I saw in one of the newspapers, we in this Party do not intend to allow ourselves to be drawn away by that red herring. We are discussing today something which economically is very sad and which is going to have very sad and unpleasant results for the people as a whole. The comment made by Senator Garret FitzGerald that this was not a late 1967-68 Budget but an early 1968-69 Budget is, on its face, patently correct. What is not being adverted to at all in any public discussion that I have seen on the Budget is the fact that as a result of the mismanagement by the Government we are going to end this year borrowing, in an inflationary situation, £7,120,000 because the Government does not know its job and did not know its job when it was framing the Budget last year.
It must have been obvious to everyone last week that what transpired in relation to the Budget was yet another example of mistiming by the Government. Originally, as we all know, it was the intention of Fianna Fáil to have the referendum in June and, in order that they might have a nice climate among the electorate in June, the Minister for Finance brought in a Budget on 25th April totally unsuited to the facts, as we knew them. He thought, of course, that the Government were going to win the referendum in June and that what they did then would not matter in the slightest; they could rig things as they wished and the Minister could mend his hand afterwards. But the referendum date was postponed and it was only last week the Government came to this House with the proposals we are discussing now, proposals which shocked the country by their severity.
There are two reasons for the severity of these proposals. First, the Government delayed the introduction of the necessary measures and, secondly, in so delaying they got themselves into a mess from which it will be extremely difficult for them to extricate themselves now. In fact, because of the £7 million deficit, they are not making any effort to extricate themselves completely. They want to do things in such a way that they will have, when the next Budget is introduced, taxation already imposed and designed to bring in, in the financial year 1969/1970, a very, very large sum indeed—a very large sum added to the normal buoyancy of revenue.
The signs were there for all to see. I do not know, Sir, whether the proper method is to describe the Taoiseach as Taoiseach or as Acting Minister for Finance. He cannot do a Jekyll and Hyde, even if he wishes to; he probably does not. When he was introducing these measures last week he said the measures were necessary because of excess consumer spending. Some few years ago we had a new Department set up by Fianna Fáil. It was set up with a great flourish of trumpets and Deputy Dr. Hillery was appointed Minister of that new Department, the Department of Labour. If the Taoiseach's view is correct as to the reason why things have gone wrong with the economy, that is yet another criticism of that Department since its establishment. Of course, the real fact of the matter is that the Taoiseach himself, the Minister for Finance, the Minister for Labour and everyone in that Government were afraid to accept their responsibilities because they did not want to offend the electorate either before or during the referendum campaign.
Whatever way one looks at these financial measures one comes back to the same thing: the root cause of the trouble was Fianna Fáil ambition to grab power through the referendum. It was only after the referendum, in midNovember, that the Acting Minister for Finance came to the House with any proposals at all. In the half-yearly returns to 30th September, published in Iris Oifigiúil of 4th October, the relevant data is to be found. Of course, the Minister for Finance would have had on his table every month, and, I imagine, the Taoiseach as well, the exact summary showing where receipts into and issues out of the Exchequer were going. Those who have not got that confidential information can assess only on a half-yearly or yearly basis because assessment depends to a very large extent on how accounts are discharged, whether before or after the end of the month. However, the half-yearly account makes the position perfectly clear.
In the six months to 30th September expenditure above the line exceeded expenditure last year by no less than £30 million. Revenue at the same time exceeded last year's revenue in the same period by £17 million and, therefore, above the line we were £13 million worse off as compared with last year. Below the line we see an exactly similar position. Debt issues this year were £26,850,000 for the public sector. Loan repayments were £3,850,000 and the net debt issues, therefore, were £23 million. Last year, the net debt issues were £12 million, so that, below the line, we spent £11 million more in national debt this year as compared with last year and, above the line, we spent £13 million more. The Government had, in fact, injected another £24 million into the economy. No wonder inflation is running riot.
When the Deputy speaks of "below the line" is he speaking of voted capital services?
No. Voted capital services are given above the line. The Supply Services are given above the line and it is only in a note you have voted capital services. Of this £13 million increased deficit above the line £6 million was referable to voted capital services. The total is £25 million extra injected into the economy by a Government which is now endeavouring to stop inflation, inflation which the Government itself created and about which it was told at the time of the Budget; the Government was warned that the Budget was bound to create inflation. Yet, in the Taoiseach's speech last week, there is not a word anywhere about any effort by the Government to cut its own cloth to suit the needs of an inflationary situation. On the contrary, the Taoiseach was very clear in saying that he wanted to be sure that all of the credit that was available would be available for what the Government required, and that we were going back to the situation in which the Government would take all the credit that could be utilised in an inflationary situation.
An analysis of the credit outstanding at present shows that personal consumer credit is running at about 11 per cent while, for example, the building industry, the single biggest factor in the national income, is given approximately 3.6 per cent only. The Government's credit is running at the rate of 14 per cent of all that is available. In other words, already, even before the sting in the tail of the Taoiseach's speech is felt, the Government's credit at 14 per cent is the highest in the whole allocation of credit in our present situation.
The Taoiseach said there was an upsurge in consumer spending, but he virtually contradicted himself at the same time, because he said that it was not consumer spending which was responsible for the budgetary position, and that the biggest increase was £9 million extra in the cost of the Civil Service—£3 million more than was anticipated. I am sure the Parliamentary Secretary to the Taoiseach can remember Deputy Dr. Ryan, as Minister for Finance, coming in here in 1957 with a great flourish of trumpets and saying that this new Government, which were going to do everything, would reduce the Civil Service in such a way that it would not cost us anything like the proportion of the national income it was then costing us and that we would not need anything like the same number of civil servants.
One year has passed after another, and one Minister for Finance has passed after another, and each year— with, I think, the exception of one year when it dropped back by about 30 in numbers—the number of additional civil servants has gone up, and the cost of the Civil Service, the administrative cost of running the country, in the words of the Taoiseach, has bounded up by £9 million.
Part of this increase will be met. How? By borrowing. This year, to be exact five months before the end of the year, for the first time in the history of the State, the Minister for Finance has had the hardihood to tell the people that he is going to add £7 million to the public debt deliberately, that because he has failed in his job of controlling national expenditure there will be a deficit of £7 million on 31st March next, in his Budget. I can see circumstances in which it might be necessary or desirable to have a deficit in the current Budget, circumstances in which it might be desirable to reflate the economy with such a deficit, but, outside the economics of a madhouse, no one would say it is correct to preach and acknowledge that you have an inflationary situation, and at the same time you do your utmost to increase that inflation by deficit financing of the current account.
This arose simply and solely because the Government could not take the action that should have been taken months ago, because of the referendum. If it had been taken months ago a very gentle braking would have been sufficient and the people would not have to bear the savage impositions of last week.
A modest import levy at the proper time.
One of the things which this Budget lacks completely is any incentive to enterprise, or any incentive to have import substitution by means of ensuring that we produce more of our requirements rather than importing more. It is perhaps as well to get on the records of the House exactly how this £18¾ million extra expenditure that will arise this year is made up.
Hear, hear.
There is a figure of £8,750,000 extra for payment to the Civil Service. Civil servants like everyone else have to live. It would not be reasonable to expect civil servants to have a special tax imposition on themselves because of which they would not get the benefit of pay increases that other sections of the community got, but that does not exonerate the Government from their failure to control costs in the appropriate way by ensuring that the Civil Service did not expand beyond what the country could afford.
Agricultural grants are up by £1½ million. There is an extra £4 million for milk support, without taking into account the £½ million for the quality bonus scheme. We are told that the errors of estimation of £4 million provided in the Budget are no longer there—no longer there at a time when revenue has shown buoyancy of about £7½ million more than was anticipated. Nothing else is needed to show that the Budget of last April was a fake Budget. The fact that those errors of estimation of £4 million have gone, at a time when revenue is buoyant to the extent of £7½ million, is clearly something that no Minister for Finance can possibly explain away.
We must remember, too, the difficulties of 1965 when certain deflationary action had to be taken by the Government. This arose again because the Government by their stupidity created inflation and broke the discipline that had been laid down as part of the Second Programme when they deliberately exceeded what the country could afford or digest, as they have done in this Budget here. If Mr. Baker in his assessment of the economy from the outside was able to see exactly where the difficulty was arising, surely to goodness the Minister for Finance and the Government should have seen it long ago, too.
Indeed, in my opinion, it was the publication of that paper that perhaps forced the Government to take action now rather than let the situation ride which was what they had originally intended. Mr. Baker advocated hire purchase controls. The Central Bank advised about the desirable level of credit expansion. Now we are told in relation to credit expansion and hire purchase controls that the Government wish to be sure that they get all they need. We all know from our experience of two to three years ago what that is going to mean for the private sector of the economy, but at the same time we have the statement by the Taoiseach deliberately urging everyone to go out on an extravagant shopping spree for Christmas this year. We are told this year's Christmas shopping, posting and telephoning will not be affected by the increase proposals. What is that but an urge to have a Christmas shopping spree? Is that going to help an inflationary situation? Is that not going to mean that the advice given is something that will make our import excess in our trade returns even worse than it is at present? Is it not going to mean we will have a more serious situation arising later? We all know what the Taoiseach has in mind is that he hopes that, in what is going to be, I am afraid, a fake Christmas trade boom, people will, until they see the hollowness of the fact, be in better humour and may, perhaps, forget the drubbing the Government got during the recent referendum. They may, perhaps, forget that, and that may assist the flagging political fortunes of Fianna Fáil. The fact that it may hurt the country does not worry the Fianna Fáil Party in the least.
What has the Taoiseach done in this Budget apart from the savage impositions on the people as regards cigarettes, beer and spirits, which are bad enough? He has increased the wholesale tax from 1st January, which is going to have the result of increasing costs right through the economy except in the very small sector where this tax is not operative. The young man getting married in the spring is going to find, as a result of the wholesale tax, that his house is going to cost him considerably more. When he goes to furnish that house his furniture is also going to cost him considerably more. Admittedly, that is one way of stopping people buying hard consumables. They will have to put back the date of buying houses until they have acquired the additional amount that will be necessary because of the Government's increase in wholesale tax. They may have to do without buying the furniture for that house in part because of the increase in the cost of furnishing included by the Government in this wholesale tax. Bad and all as that is and uncomfortable and unfair as that is, it is much worse that it is going to mean that, on top of the increase in the labour cost, a real body blow is going to be given to many of our exports because this wholesale tax is going to have the effect of increasing seriously the price level of many industrial exports. Costs are going to go up on industrial exports and industrial prices, as a result, will be increased; and with that increase our competitiveness will be affected.
What has the Minister for Finance done in this Budget to attempt to ease or to solve what is a serious position? Nothing. There are a few trifling references to saving, most of which were forecast in the Budget of last April. In one case he is merely increasing an incentive. According to the Budget speech of 25th April he was going to do something and solve all our problems by increasing the Trustees Bank Interest rate to 3½ per cent.
Incidentally, when speaking about Now that has to be increased to four per cent. wholesale tax, I forgot to mention one place where this tax will fall particularly heavily and that is on the provincial newspapers. They are going to have to meet an additional burden of cost—just, of course, as the national papers will similarly have to meet an additional burden of cost. I understand in many countries in the world, because of the fact that newspapers are a necessary part of the media for the spreading of appropriate information in any democracy, they are exempted from this type of wholesale tax. An appeal was made to the Minister for Finance on their behalf before. It was rejected. Now, not merely was that appeal to have the existing five per cent wholesale tax rejected, but it is to be developed in a way that is going to have a most injurious and painful effect.
Where in this Budget or as a result of this Budget is there any enthusiasm or any incentive to increase employment? Is the word "employment" really considered at all? So far as I can see from the proposals introduced by the Minister and by the Taoiseach, they had not any advertence to the fact that we are running a higher unemployment rate this year than last year, week in and week out. Where is the Miscellaneous Finance Bill that was promised would be circulated during the Recess? Everybody who has any necessity to question these matters is in complete chaos because of the failure to meet that circulation date. Why was it necessary, again for the first time in our history, to come to the Dáil with a proposal for something that should be and is above Party politics, the flotation of a national loan? As Deputy T.F. O'Higgins said last week, we in this Party urge and welcome all possible efforts for the success of that loan; but it was an outrage for the Taoiseach, as acting Minister for Finance, to endeavour to smother the vote of no confidence, to endeavour to quieten the Opposition, by introducing a national loan on the same day. It was part of the tricky little things for which this Government have become so infamous and which is one of the reasons why the country as a whole would welcome the opportunity of changing the Deputies on that side of the House over to this side.
On looking up something in connection with the Budget of last April I came across this circular letter that was sent out in March, 1965:
The decision to call a General Election now was unavoidable. It would not have been helpful to the national development campaign to have a protracted period of political uncertainty. This would have been prejudicial to all progress and have a dampening effect on the entire economy.
That paragraph is entirely appropriate to the present time. I believe that if the Taoiseach had adopted the advice contained in that letter the protracted period of political uncertainty that lies ahead would not be there. That quotation is from a letter issued by Deputy Seán F. Lemass from the Fianna Fáil headquarters in March, 1965, looking for funds for the then general election. It is a general election the people want now but the result of Divisions in this House will not get the people the opportunity they desire.
This Budget fails completely under six headings: firstly, it fails because there is no incentive to enterprise either for individuals or for corporate bodies. Indeed, the need for incentives does not appear, from what the Taoiseach said, to have been realised or appreciated by the Government. Secondly, it fails because of the impact which the wholesale tax will have on industry and on exports. Thirdly, it fails because there is no real encouragement towards savings as an alternative to heavier taxation but instead the promise of heavier taxation still. Fourthly, it fails because there is no indication whatsoever of any control of borrowing by the Government but rather that we have injected into the economy more money through borrowing than was the case last year. Fifthly, it fails because the Taoiseach has made it clear that there is no effort being made to get Government expenditure under control. In fact, it is obvious that expenditure by the Government has got out of control. What else could happen when we know that we have four or five "Taoiseachs" on the opposite benches, each pulling a line to suit himself and the nominal head of the Government exercising no control over his Ministers, being either afraid or unable to do so—only he himself knows which it is? Sixthly, it fails because, as Deputy Dillon interjected earlier, there is no real help to the balance of payments being given in this Budget to provide import substitutes. Any Budget, be it a supplemental one or an advance Budget, that fails on those six points is something no Government can stand over. The Government that has introduced it, can do only one honourable thing—leave the people decide to put someone more competent in charge of the necessary finances.
With justice, I suppose, this Budget could be described as the bringing into effect of a long Ash Wednesday for the people of this country. In fact, this has been an Ash Wednesday Budget and I suppose, by the look of the results of it, we may expect a long Fianna Fáil Lent until some time next year.
You can have a small "coalition" during Lent.
I think "collation" is the word. However, we can describe it as a long Fianna Fáil Lent. It is good to see that Party doing penance but many of us may protest that we also must do penance with that Party. The problems brought on by the Budget can be proved, as we think they can, to be the result of the neglect of the Government in the handling of the economic situation earlier this year. When introducing the Budget in April of this year, the Minister for Finance said he did not believe in the general idea of a second Budget in any one year. He said, quite justly at the time, that it would make it extremely difficult for businessmen, for trade unions and trade organisations in the State. It made it very difficult for them if they could not have confidence that the Government would not be bringing in a second measure later in the year. It would make it impossible to plan one's business with any confidence if one were at the mercy of the Government which, having introduced a Budget, found it necessary to revise these measures some months later. However, that has been changed and we now have this Ash Wednesday Budget.
The Taoiseach in his opening speech referred to fanciful metaphoric clouds on the horizon but these have now been ignored. However, the main reasons, according to the Government, for this Budget are given on page three of the Taoiseach's opening statement where he refers to the fast rise in imports this year being directly due to a strong upsurge in personal consumption. Indeed, as we know, the main measures of the Budget have the result of increasing personal taxation and taking money out of circulation, taking money out of the purses of the general public. Our main objection is to this penalising of the individual citizen of this country. We disagree with the idea that the financial and economic policies of our present Government, as a result of which we now find ourselves faced with this deficit this year and the prospect of a larger deficit next year, something that has been forecast as £53 million next year, have adversely been affected by the ordinary citizen of this country who has been spoiling himself over the past year. This would appear to be the basis of Government thinking. Therefore, to prevent this ordinary citizen from over indulging himself in the next few months, the Government propose to take this money from him by way of the proposed increased taxation. In fact, with this increase in consumer imports that we have been having there has also been an increase in the import of capital goods. Not alone has there been an increase in the import of consumer goods, luxury items, and so on but there has been an increase in imports of capital goods such as raw materials for industry.
It is not quite logical or correct or in accordance with the facts to suggest that the present situation has arisen because of an over-indulgence in nonessential items on the part of the ordinary citizens of this country. We must also understand that the increase in industrial production in the past year contributed to some degree in calling for an increase in necessary imports to bring about that increased production. Certainly, the taxation measures of the Government are unjust when we consider how this situation has come about and the factors leading to this deficit which has now frightened the Government into taking these measures.
It has been said that some intimation that there would be a deficit in our balance of payments situation this year could have been given some months earlier this year. Some economic commentators pointed out that a deficit would in fact take place. No doubt it will be referred to ad nauseam in this debate that a responsible Government, anxious to avoid the severe judgement of the ordinary taxpayers of this country, would have taken measures earlier to prevent the kind of agonising exercise they were forced to go through last week which has, I venture to say, been treated in all quarters with equal condemnation. I do not know of any trade association, trade union or any body of people in the country who have anything good to say about this Budget. A so-called “Economics Correspondent” in the Sunday Press saw good in it, in last Sunday's issue of that paper, for the small savers. Such a correspondent, writing for such a paper, would labour under a certain restriction in that regard. However, people with no political axe to grind, and considering purely the whole outlook for this country, were unfavourable in their comments on the mini-Budget. Therefore, we cannot say that the consumer, the ordinary citizen of this country, is responsible for the current situation. We must admit that the import increases which have taken place owe as much to the demands of industry— demands we are all anxious to satisfy by increasing imports of capital goods, and so on—as to demands by the ordinary consumer in our economy.
Faced with the situation of a deficit of £16 million this year and a projected deficit next year of about £53 million, the Government even at this late date, had two alternatives, in our opinion. It is revealing which alternative the Government took. It is revealing to note the behaviour of the Fianna Fáil Party on the election hustings and the actions they are prepared to take at the moment of truth when, for instance, it comes to bringing forward financial proposals. For the past 18 months employment has been pretty static. There has been a pretty high increase in productivity over the past two years. The ordinary people who man the machines in the factories of this country have achieved a remarkable increase in productivity over the past two years. This very welcome increase in our economy has not, however, reached the stage of bringing about an increase in employment. Irish industry has picked up in the past two years. We had reached the point where the full capacity of Irish industry was being used and it was on the verge of moving forward to the point where it could take in extra workers—a very essential thing in view of our almost static employment position in the past 18 months.
Every Party and every politician in this House subscribes to the view of the desirability of increasing employment. It is instructive to note how the Government have acted in face of the possibility of continuing the upsurge in the economy to the point where we would have more jobs or, alternatively, cutting back to the position of fewer jobs so that the current position of a stagnation over 18 months in the employment position would continue. This Government opted for the situation where fewer jobs would be obtainable next year. This is really why the public condemn this Government and this Budget. Firms in this country have informed Industrial Survey that they were on the point of taking on fresh workers but, most certainly, in the wake of this Budget, with the increased wholesale tax which is to come into effect next January, these firms will not now do so although, prior to this Budget, they would automatically have been expecting to do so up to that point.
We had the choice of continuing the expansion in our economy which was necessary to lead on to fresh employment. Having reached the point where Irish industry was using up its full capacity and where it was on the threshold of bringing in new workers, the Government have now taken the choice of cutting back on it: in effect, they have decided to cut it back. There was a risk involved in it. But we could have taken the risk of finding our way out of the economic dilemma by deciding to allow this balance of payments situation to continue out of plumb, to allow the deficit to continue, without harming the employment prospects in this country. The choice was open to the Government at this stage but they neglected to back employment. Instead they chose the way of financial stability.
It is not simply the advice of exotic people such as socialists or of a socialist Party like the Labour Party in this country but it has been the advice of many economists that the increase in our external assets—which, last year, increased by £40 million— could be used to cushion the balance of payments position.
If we were facing next year, at its worst, a deficit of £53 million—we had a deficit this year of £15 million— we could have, against the increase in our external assets last year, allowed our deficit to continue at that figure without attempting to correct it. We could have absorbed the increase of £40 million in our external assets last year to cushion the balance of payments. Therefore, it appears that increased employment is certainly not the priority of this administration. We can most certainly say that financial stability, as known 20 or 30 years ago, before even a person like Keynes came along, is the priority of this Government. Many economists for some time have been saying that the Government could allow a run down of those external assets. They are running at £300 million at the moment. To put it in a nutshell under this administration we cannot have any condition approaching sustained growth in this economy; in fact, there will be a continuous stop-go policy and a stop will occur on the slightest pretext in relation to our balance of payments.
From January next, this wholesale tax increase of five per cent, while it does not directly come to bear on food, and so on, must have some influence on practically every item right across the cost of living. For instance, companies involved in food processing will have to pay extra for containers and so on. Housewives know, even though the Minister may not know, what articles will be affected in the new year. As other speakers have said, in the matter of housing the wholesale tax increase will affect practically every raw material going into the building of houses, and we shall see even more pressure on municipal housing schemes throughout the country because people will be less able to afford to build their own houses. In a full year £9 million extra taxation will be laid on the backs of the Irish taxpayers.
Already we have seen the first fruits of this Budget as it affects trade unionists. The Irish Congress of Trade Unions have indicated that wage agreements negotiated over the past 12 months must now be reconsidered in the light of the Government Budget. I have seen in this House in the short time I have been here many Deputies in the Government benches becoming over-excited about people who were putting the economy in jeopardy by unofficial strikes and the like. This administration is guilty of the highest economic irresponsibility in bringing in a Budget for which the people were unprepared. They have failed in the elementary duty of a Government to bring in a Budget in one year that incorporates most of their national housekeeping proposals; instead they have introduced a second Budget of huge proportions which has brought in its wake massive punishment for the taxpayer. The people whom we have praised from these benches before now, the factory workers and other employees who have contributed over the past few years, without much official backing, towards increasing productivity, are now to be punished for their good behaviour. The trade unionists are to be punished once more by this Government not for anything they have done but for the misdemeanours of this Government. A Government involved in such irresponsibility is guilty of grave economic treason to the Irish people. This Government is in no position to blame anybody for unofficial strikes when it has been guilty of unofficial economic action — because this is what their Budget means; without warning they have brought on the country a lightning Budget which is to take £9 million out of the pockets of the Irish people, a Budget which is not connected to any economic programming. It is a hit-and-run Budget and there is very little excuse for it at this time.
This Budget will hit at the progress of the economy. Nobody can see how it will contribute to increased employment. The only thanks trade unionists have received from the Government for increasing productivity over the past two years is to have this increased burden of taxation imposed upon them. The logic of this situation, where you have a Government that no longer appears to have a conscience in dealing with the people, is to strike hard whenever the opportunity presents itself and when any talk about the national interest or about the interest of the economy arises, to ignore it, because the Government of the day ignores it; and what is good enough for the Government should be good enough for any group of people around the country seeking to improve their standard of living. Is this not the example the Government have set for the people? They have given this maxim to them: "Mind yourself and do not mind about the community." The Government have shown they will mind themselves and will not worry about the community.
One remembers a few years ago when the Prime Minister of the day would talk about an incomes policy. It seems very long ago now and less has been said of it in the passing years. We are not permitted under the Rules of the House to give the reply he merits to any Minister who comes in here and speaks about an incomes policy. However, everyone will understand our attitude on this maverick Budget introduced in the past few days.
It is extraordinary that the economic advisers, forecasters and commentators, with which this Government is bristling, and all the modern apparatus they have at their disposal, have not been able to prevent the Government from falling into this elementary trap. We have had all those glossy reports during the past few years in the form of economic programmes and, to soft background music, we are to have a third programme in the new year. How exactly could such a Government, staffed with such brilliant economic chiefs of staff, generals and a high command bristling with economic capacity, produce a Budget earlier this year and then a week ago produce a second Budget which makes it appear that the Government are no better staffed, that they have no greater expertise than any Government during the past 30 or 40 years? Last week's Budget is just a blood-brother to every Budget presented since 1922, and this is 1968.
By their fruits you should know them, I suppose, and the Irish people have for too long taken Fianna Fáil at the words of their advertising agents without looking too closely at their record as a Government. Now, however, there are signs that a recognition is dawning among the people as to the true nature of the Government. Our real worry must be that this frightened administration, hitting around now for any stratagem to save them from the verdict of the people, may bring this economy in ruins around our ears.
The Government will take £9 million in extra taxation next year and obviously they are preparing, for presentation some time next year, a Budget which will have a sedative effect on the Irish electorate. We paid last week for the sedative the Government are preparing for the electorate next year and which they hope will make the electorate forget the bitterness of this Budget. Of course, they have a great deal of political wisdom on their side. Even a week is a long time in politics. The public have very short memories and if sufficiently attractive sedatives are presented to them next year there is a possibility that, together with tinkering with lakes and mountains in the West, the Government may be able to stagger back to office to lead us still further along the primrose path to economic doom.
I do not deny that possibility but we must inquire exactly what is the background thread to the Government's behaviour next year. If they are preparing a large-scale sedative for the Irish people next year, the fact is that the Government are carving out their own stake in a continuous spiral of inflation because, with the money they will have taken from us before Christmas this year and which they will take from us during the whole of next year—the money they will extract in increased taxation together with the normal buoyancy of revenue which any Government can talk about any year; £25 million can be put down to buoyancy of revenue—I reckon the Government will have for distribution before the general election next year something in the order of £40 million. That will be the largesse to be distributed by the Government arising from the measures introduced in this Budget.
Our accusation against this Budget —it can be said that the April Budget was a political one—is that it is a political Budget representing a very low, cynical Government estimate of the Irish people. It represents a most cynical assessment of the electorate. It presents us with a situation that at an appropriate date next year they will have £40 million ready within earshot of the time they will bring their bedraggled administration before the electorate. With this gigantic Government trick there is the possibility that they can win their way back into office. This Budget is, from that point of view, a more political Budget than the April one and it poses the most cynical estimate so far of the Irish people.
I do not see how the trade unions have any alternative but to reply in kind to the proposals of this Budget. I do not see how any trade union leader can be expected to counsel his members to exercise wage moderation and restraint. After all, he, too, must undergo election by his members—it is the approval of his members that keeps him where he is. In view, then, of the massive increase in the cost of living arising from this Budget, could a trade union members so advise his members?
It is particularly ironic that the Taoiseach next week will preside at the National Productivity Year, going under the slogan "Move". It is not a move directed at the present administration. "Move" is a slogan to suggest that we must call for more enterprise and productivity in the economy. It is not directed at the Fianna Fáil administration to move elsewhere: it is directed at industry and labour to move in the direction of economic progress. Probably the Taoiseach will not see contradiction in his talk about the necessity for increased production of the Budget he brought in last week which will dampen down demand, putting the economy in slow gear. Talking in terms of motors, certainly the Budget of last week can lead to a total breakdown ultimately of the vehicle which is the economy.
The Taoiseach will go to this grand opening to speak to leaders of industry and unions, to say we must have increased productivity, yet he is the head of a Government who make no economic advance whatsoever, who, as I have said, cut back on employment, who will not give the green light for increased industrial expansion.
Obviously, Deputy Childers will have a glorious innings during the next few months, a period of stagnation in the economy. Deputy Childers arose after the Budget to give one of his interminable lectures, as he does up and down the country, on what is essential for the economy. During the referendum campaign he located Reds under every bed in the country. After the referendum, in Mountjoy School a week ago, he told the young people there how pleasant it is to live in a country like this. Undoubtedly it is extremely pleasant for Deputy Childers but not for thousands of housewives and others who must try to exist during the year following this Budget. Deputy Childers will have a fantastic innings telling in exquisite terms, ad nauseum, chambers of commerce, and other organisations throughout the country, who are the people to be blamed for our economic stagnation. If honest, he will say that the people really responsible in a large way for the stagnation, the unemployment, the worsening of the lot of the people in the new year, are the present administration.
The employment market at the moment is thronged with people who have just left school, young schoolleavers, and because there are no job opportunities in Britain there has been a falling off in emigration to Britain. All these people are in search of jobs and this Government have said to them: "We are not interested in your plight." A few weeks ago we had the Government on television saying they were looking for the votes of the young people but they are telling them this week, through the medium of this Budget that they are not interested in their quest for jobs; they are more interested in following up the policies they followed before to ensure a financial stability. To cut down on external assets might be too near the wind of socialist policy. They could not, in fact, catch up on what Lord Keynes said 40 years ago. They have been playing safe ever since 1932. That is what Fianna Fáil will tell the young people of this country. They have no interest in job opportunity but more interest in ensuring that they will have the cash to ensure largesse in the new year to serve their own political purposes.
I describe this Budget as an Ash Wednesday Budget. It is unfortunate that we must all join the penitential impositions of this administration. If sackcloth is to be worn at the present time every member of the present administration should wear that sackcloth. If ashes is to be put on the forehead of our public sinners then we should see it on the forehead of every member of this administration. Over the past year they have taken a holiday from their real responsibility as administrators of the affairs of this country. They have taken a holiday in furtherance of the fortunes of their own political Party and we all must suffer for their mistakes. It is up to all of us in this House, and it is certainly up to the members of my Party, to see that we number out the remaining period of this administration and give the long-suffering Irish people an opportunity of seeing policies in action that will solve their living problems.
I have never yet seen the Opposition support a Budget. It is, indeed, peculiar to hear what Fine Gael have to say, that the Minister for Finance should have been able to forecast earlier this year an increased yield of wheat, an increased yield of milk and increased subsidies in respect of agriculture during the present financial year. It is also peculiar to hear the Opposition say that the Government should have anticipated at the start of the year the exact rate of increase in remuneration which would become payable to civil servants and other State and local authority employees.
How could any Minister for Agriculture or how could any Government foretell in February or March that the ensuring year would be a fine year, that we would have one of the best summers in history, in living memory? How could any Government foretell that we would have a yield of wheat in or around 36 cwts per acre which is a record for this country? It must surely be a record. How could you forecast so early in the year the increased yield of milk despite the fact that you had a slight reduction in the number of cows? How could you foretell through every year that 1968 would be a great grass year, that you would have better grass this year despite the long period of dry weather? How could all these things be foreseen earlier this year, between Christmas and budget Day, when the financial aspects were being looked into and prepared?
The Opposition speak of increasing taxation but with increasing expenditure you must have increasing income. If there is any other way to get income other than through taxation, and, of course, rates at local level, all of us would be pleased to hear of it. I should like to draw attention to the increase in subsidies for agriculture over the past ten years. In 1956-57 it was £17 million and this year it is running in the region of £80 million. Any person with any degree of commonsense would know that taxation at a rapidly increasing rate is essential to keep up this subsidy for agriculture or, indeed, to keep up any rising rate of expenditure on any service.
We hear the Opposition making light of 1d per gallon increase in milk for the first 7,000 gallons. This is a big breakthrough. For the first time we have seen differentiation between the smaller farmer and the bigger farmer. We have seen for the first time a big breakthrough and we know that the difference of 1d a gallon in 1968 could well become in the years ahead with greater production and rising economy 3d, 4d or 6d. This would be of great benefit to the smaller man. It is the smaller man who supplies 7,000 gallons or less to the creamery about whom we should be primarily concerned. He cannot turn to beef production overnight. He must depend on the cows and on the milk for income to support his family and his household. He cannot swing to beef overnight or, indeed, during the course of a year and in any case his holding is usually so small that it would not support sufficient cattle to enable him to make a livelihood from beef.
We have established the two-tier price for milk and this will be of increasing benefit to the smallholder. I have great sympathy with the larger farmer who undoubtedly is also an important man in our economy. There is plenty of room for him to grow more barley, for example. We all know the large amount of barley which we import yearly. There is great room for him to grow more barley and more wheat at the right price. As well as that, we must take into account the recently announced scheme of a subsidy for beef in respect of holdings where the farmer does not sell his milk but feeds it to calves and produces beef. This must surely be a very enticing scheme for the larger holder. I cannot visualise the small man gaining much from this but I would say that the larger farmer will definitely benefit from this scheme while, at the same time, the small man will benefit from the new breakthrough of a two-tier price for milk which will be increased, I have no doubt, as the years go by and as the economy can afford such increases.
Again, I would ask the Opposition to say how any Minister or any Government could have anticipated the exact rate of increase for civil servants so early in the year. In any event, it is surely the responsibility of a good Government to follow rather than to lead in the negotiation and the giving of approval to pay claims. We hear the Opposition speaking so loudly of the cost of this increase to the civil servants, to the semi-State employees, to the local authority workers, to the workers of the health authorities, the hospital and nursing staffs of this country. Surely these people are as entitled to an increase as anybody else? Surely the local authority worker, the civil servant, the nurse, the garda, the teacher, is as entitled to an increase as anybody else? There is no way to pay for it except by taxation. In my view it is a real sign of a sound Government to come in at the right time and seek money to pay these increases and not to put it on the long finger and wait until such time as the bill gets too high. I believe that these employees of the State and local authorities are doing a tremendous job in spite of many difficulties and in spite of the fact that they are not before the public eye and do not themselves get credit publicly for their work which cannot be seen publicly. It is only right and fitting that the Government should give at the appropriate time the appropriate rate of increase to its employees and raise the appropriate taxes at the appropriate time.
We heard Deputy Sweetman speaking a lot about what he called the expansion of the Civil Service. Surely in this day and age with so many additional services being introduced, with so many new schemes being introduced, you cannot carry out all these schemes plus all the work which was on hands already with the same staff? Surely it must be necessary to provide additional staff for the Department of Education to deal with the new elucation proposals, to deal with the free transport, with the free books scheme, with the new post-primary scheme? It must be necessary to have additional staff in this Department. In the course of the debate on the Estimate for the Department of Lands we thanked the Minister for providing additional inspectors for the Land Commission so that they could move on with their work and get ahead with the job of acquiring and sub-dividing more land. With the expansion and the introduction of new schemes in the Department of Social Welfare it must be necessary to provide additional staff there in the new Department of Labour. We have the re-organisation of the Industrial Development Authority for the purpose of providing more jobs. Surely all these Departments and all these services require a staff and additional staff to cope with the everincreasing and ever-expanding services?
We heard the Opposition criticise the increase in the wholesale tax, which is in a way a selective tax, but we have not heard the Opposition say where the money is to come from to provide these services and to pay the necessary personnel to provide these services. We have not heard the Opposition say where they would get the money to introduce and to put into operation overnight all the schemes which they have promised they would put into operation if they got into Government.
We heard some of the Opposition speakers refer to our external assets in relation to our aim to attain full employment. I would like to remind the Opposition that the recent census of population showed a rather substantial increase in population over the 1961 census. For the first time since the Famine days we have had a significant increase in population. Surely this is a criterion of progress. Some Deputies say that the Government should reduce our external assets and utilise the money for local domestic purposes. We all know that, if we are to attract industrialists and if our country is to command and retain its status abroad, our external assets and reserves must be maintained and that it would be very poor policy to take the chance as my namesake, Deputy Michael O'Leary said, of reducing our external assets. It would be wrong for any Government to take a chance in such an important matter.
I believe this Budget is indicative of a Government that hold the reins, the steering-wheel and are not prepared to take chances as suggested and advised by my namesake. This Budget is indicative of a Government concerned to ensure that the country's economy is always on a firm and sound basis. It is indicative of a Government confident that their policies are right and that they will be in Government for many years to come, more so now than ever before since the people in the recent referendum showed great fear of a swing towards Fine Gael or Labour which would give either Party control of the country.
That is whistling passing the churchyard anyway.
We appear to be living in times of extraordinary financial reasoning and in times when, by the week, the day and the hour the arguments of Government spokesmen become more fanciful. We hear stories of great social and industrial success. I want to apply to them the test applied by a one-time leader of Fianna Fáil, the test of unemployment and emigration. A reply from the Taoiseach's Department today on the question of emigration which confines it to intercensal periods, naturally enough, gives a figure for those who left the country between the census of April 1956, and April, 1966, of 292,608—the forward march of Fianna Fáil. The number of persons mainly engaged in agriculture between 1956 and 1967 declined by 108,000—the forward march of Fianna Fáil.
I referred to extraordinary financial reasoning. Very often when it falls to the lot of a Minister for Finance or somebody deputising for him to impose taxes either in the annual Budget or in a well-kept secret one like this, economic reasons are given such as adverse terms of trade, balance of payments abnormally high, some crisis in some part of the world affecting our economy. We have them in 1956 and they were scoffed at by the Fianna Fáil party. We gave the real reasons for the stringent measures we had to take at that time in order to put the country on its feet. We did it so firmly and securely through Deputy Sweetman, Minister for Finance at that time, that it has survived the ravages of Fianna Fáil since 1957.
Deputy Michael O'Leary has called this an Ash Wednesday Budget but the word "Ash" has given me another idea. This is an ash plant budget, a budget brought about in the main to inflict punishment by Fianna Fáil upon what they would like to think of as a recalcitrant people. Consider the whole story of this Government and its relations with the people. They have fought with civil servants in various groups, fought with teachers in various groups, fought with two different groups of farmers, the beet-growers group and the dairy people. They have fought with the fishermen and with every conceivable section of the community. Mark you, their last great effort was when they took on the electorate. They said that the only way to beat all these sections that were besetting them, when they were really only appealing for justice, was to produce proposals that would give them unlimited power so that they could chastise them in full. They failed in that.
I do not subscribe to Deputy O'Leary's view that it was fear on the part of the people that Fine Gael would get into power if it was possible to have large and rapid swings under single seat constituencies. This was not a fear. I remember speaking in the town of Carraroe on the Monday before the referendum when many people had been speaking of their fear of apathy. I said publicly that there was no apathy, that the great silence of the people, in my interpretation, was fear that they were going to be deprived of something which they cherished, something they believed they could use to their own advantage in PR. That fear and that silence was exemplified by an avalanche of the electorate voting against these domestic despots whom they are no more prepared to tolerate than the despots from outside in former times.
This is an ash plant budget, an ash plant being wielded in the shape of 2d on the pint, 4d on the packet of cigarettes, twopence on spirits, a five per cent increase in the wholesale tax from next January and an increase in the letter postage rates and in telephone charges making it more difficult to get in touch either by post or telephone with the 292,608 emigrants whom Fianna Fáil banished between 1956 and 1966.
We have a new reason now for increased taxation. When Bord na Móna get into trouble they blame the bad weather: when the ESB run into losses they blame the bad weather and when there is, in fact, bad weather farmers legitimately complain about the difficulties of saving their harvest and associated difficulties. But what is the new excuse from the Government? Good weather: they could not have anticipated that our grass would be greener or more lush, that our cows as a result would give more milk. Apart from the economic geniuses in Fianna Fáil they had only to look at Old Moore's Almanac for 1968 and they would know about the fine summer and bumper harvest. Obviously their capacity to plan with the statistical material available to them is not even equal to the speculative quality of Old Moore's Almanac.
We had, between times, an increase permitted in insurance rates for vehicles. That in itself was a substantial rise. Surely at some time before the referendum campaign went into full swing it was within the knowledge of the Taoiseach and of all his Mini-sters—so many of them as he is on speaking terms with at the moment— to know what these increases were coming and that in their view they were necessary? Why did they not tell the people during that campaign when they had great access to them, in fact, an access they thought was going to result in a smaller constituency with a more effective TD.
These little "Yes" posters now surviving the blizzards and rains of November make a very forlorn picture. They are crumbling on the ESB poles on which they should never have been put. Why did they not tell them then? Why did they not tell them during that campaign "As a result of the extraordinarily good weather we have had, we have had a lot of green, lush grass and a lot more milk, and we will have to impose taxation on you to make you pay for this or some of this"? They did not tell them because they were, as Deputy Michael O'Leary said, cavorting around this country on a sort of holiday with pay and a holiday with transport from town to town and from fair to fair, from midnight gathering to midnight gathering, trying to rally the stalwarts to the cause in which many of the stalwarts were beginning to lose faith, or, in fact, had lost faith. It is of no avail now to the Taoiseach or to any of the Ministers with whom he may be on speaking terms to be talking about the maturity of the electorate.
Over-ripe.
That maturity was probably also a result of the good weather that we had; it was over-ripe. If it was an exercise in maturity it was not what the Taoiseach tried to make out it was, a recognition of the integrity he says exists right along down the front benches from his bench to that of the last Minister appointed. The people voted in such large numbers against these proposals and the likelihood of the undue power that might result from their success, because they knew that the integrity was tarnished and well tarnished in many places and over many years. If there were no other argument wanted to deplore this particular Budget and these taxes it was to be found in the reaction of people and publications the next day.
All economists of standing and all businessmen of repute in every kind of business whether in distilling, in tobacco or anywhere else, condemned these measures as measures that would halt any advances planned for the economy or which the economy was experiencing. On the face of all that, how can the Fianna Fáil Party, led by this bettered Government in disarray, try to force on the majority of our people, headed by economists and businessmen, the view that this taxation and these impositions will result in good for our people? They cannot do it and when the Taoiseach says that when they go up for a general election they will come back again he is merely whistling by the graveyard. It is a different sort of speech to the one he made when interviewed on Radio Telefís Éireann during the referendum count when he admitted a loss of prestige and when he admitted that it was quite on the cards that they were not coming back. Being convinced of this they are now giving the last hitand-run blow to the people, the last blow by the bully, giving them the last "skelp" for what they did. This is an ash plant Budget and the ash plant is being brought down fairly and squarely on the shoulders of every man and woman, every man who takes a pint and every man or woman who smokes, and every old age pensioner who enjoys a pint. The Budget in the main is directed against them because they said "No, no" on referendum day.
This is the punishment meted out by a Government mad with rage, a Government seeking vengeance, a Party in disarray. Indeed, in these times we are not clear whether the greater fight is going on outside at the various meetings attended by the Taoiseach and the Minister for Agriculture and Fisheries or whether the greater fight is going on in the Party rooms where constituency boundaries are being butchered in the interests of selfadvancement. When we see this gerrymandering Bill tonight or tomorrow the whole country will again take the bit in its teeth and say: "We will have none of this. When they cannot get it one way they are not going to get it the other way." The Fianna Fáil Party will eventually be found to fit into the category applied by Deputy Seán Lemass when he said of the Fine Gael Party at one time that it would be found to be the superfluous Party in this country. Fianna Fáil will be found to be superfluous and will fade away. We will regret the damage it caused but rejoice that because of the damage it has left us.
This Budget is going to cause a sharp increase in the cost of living and it will and it must inevitably be followed by price rises and demands for increases in wages and salaries. It is a vicious circle. What is wrong with this Government, and it has been wrong with them for a long time, is that there is no consultation or dialogue between themselves and the people. They are there in their bullet proof, cheque-lined ivory tower. They think that there they are safe from every kind of attack merely because they are in effective control at the moment, merely because they have large funds in their Party, merely because they are able to dispense large amounts of the taxpayers' money to the organisers of the funds in their Party.
When the Taoiseach comes in here to attack Deputy L'Estrange about not giving information that he had as evidence, or alleged he had, in relation to a planning case, and purported to give the difference between what appears on pleadings and what is evidence, I want to tell the Taoiseach—and I am sorry he is not now in the House—that I gave him information over ten years ago on what related to a criminal charge; I gave him accurate information; I gave him information of full evidential value and how did he use it? He was the relevant Minister then and he used it, with the collective authority of the Government to which he belonged, to instruct their then Attorney General to ask the district justice to refuse informations at a time when the district justice was going to return the accused for trial.
The district justice thought fit to ask counsel for the Attorney General: "Are you withdrawing the charges?" and counsel for the Attorney General was able only to say: "My instructions are that informations be refused". The district justice, obviously appalled and shocked by this performance, asked again: "are you withdrawing the charges?" and counsel for the Attorney General again repeated: "My instructions are that informations be refused". "Very well", the district justice said and the order on the district justice's book is: "Informations refused at the request of the Attorney General, the charges not having been withdrawn". Now, if Deputy L'Estrange had any further information in relation to this planning appeal, this scandal that shook this town and the country, which he had not—all he had was that there was a case, that the pleadings definitely referred to planning permission and that the money that passed was a consideration for getting planning permission——
I fear, Deputy, this has nothing to do with the financial policy of the Government.
On the general policy of the Government——
——and on the distribution by the Government of State moneys and taxation generally, I feel I am entitled to make these remarks.
I feel the Deputy is out of order. On the Budget the matters for discussion are taxation, expenditure and financial policy.
There is money in this for the Department of Justice and this is the financial policy of the Department of Justice. That is all I am dealing with.
It would not, I feel, arise under the Budget heading.
If the Taoiseach could refer to it on Thursday evening last I see no reason why I cannot refer to it now and I now propose to educate the Taoiseach on the pleadings and evidence in relation to this case, on which the Minister for Justice spent some time and, obviously, some money, not in investigating it but in allowing time to pass while the money was being spent so that evidence could be destroyed and was, in fact, destroyed. Look, Sir, I am a lawyer. Deputy Flanagan is an auctioneer.
I am sorry. I did not hear the Deputy.
I said I am a lawyer. Let not the Deputy think I would enter his category lightly. Deputy Flanagan is an auctioneer. There are others in the House, who are engineers and, possibly, architects. The Taoiseach is a lawyer. So is the Minister for Finance. So is the Minister for Justice. So is the Minister for Health. So is the Minister for Education. I am sure that, in the course of their experience as practising lawyers in drafting appeals against the conviction of someone in a criminal court, or in the acquisition of land by the Land Commission, or against the refusal of planning permission by the local authority to the Minister for Local Government, their fee, in accordance with the general scale of fees in this country, would be reasonable.
I am afraid any Taxing Master would not allow me, or any other lawyer, engaged in the drafting of such an appeal and the specifying of the grounds, any more than 15 to 20 guineas. Neither would an architect or engineer, though he would get something higher than I would, get any more than 30 or 40 guineas. But here is a teacher, with no qualifications at all in law, engineering or architecture, demanding and getting £2,000 to assist in obtaining a planning appeal which had been refused by the county council. A teacher!
I am sorry to interrupt the Deputy again, but really this does not arise on the Budget debate.
This arises on the way in which Government policy is being implemented and the way in which the planning authority in the Department of Local Government is being operated.
The planning authority does not arise on the financial business before the House.
The Minister for Local Government is responsible for planning and has been responsible for planning. He is part of the Government policy on that particular aspect.
That would open up discussion on every question, which discussion would be totally irrelevant. I want to point out to Deputy Lindsay again that the only matters for discussion on the Budget are taxation, expenditure and the financial policy of the Government. The matter mentioned by Deputy Lindsay is one for the relevant Department on the Estimate and questions arising on Estimates do not relevantly arise on the Budget.
The salaries of planners, Ministers, Parliamentary Secretaries, Deputies and your own salary, a Cheann Comhairle, and the salaries of teachers are paid from taxation. It is out of this taxation background that I introduce this. £2,000!
The Chair again informs the Deputy that it is irrelevant. It does not arise on the Budget discussion.
This man was probably paid out of the increased taxation on beer, was he not? I do not know, but it is possible.
This particular man is on the payroll of the State. In addition to that, he holds himself out as a person who can get planning permission. And, you know, he got it. Dublin County Council refused the permission. The Minister granted it at his request or using his influence. The fact that they were both Donegal men probably does not really arise. It is probably a coincidence. But here is the situation: he gets £500 down; he gets two post-dated cheques, one for £1,000 and one for £500 and the planning permission, through his intervention, arrives earlier than the date on the post-dated cheques and the boys who got the permission said: "You know, £500 was enough for him. We will stop the other cheques". Was he beaten? Not at all. He knew he had them and he sued them for £1,500 on foot of the post-dated cheques in respect of which payment was withdrawn.
The matter does not arise on the Budget debate.
On the threshold of the court they settled it because each was afraid to go in. They knew perfectly well that, if they went in, the presiding judge would immediately seize upon the evidence, the cheques, relate them to the planning permission and send them to the Attorney General.
I want now to challenge the Taoiseach to put the pleadings—they have the pleadings—in the Library so that everyone can see them and see that a teacher, who has influence with this Minister for Local Government, can get £2,000 for his pains. I wish we could all command such fees but we, of course, operate in open court. We operate in accordance with a standard of ethics. Our talents are for sale, but they are for sale at a reasonable price. Now this is one of the things the people rejected at the referendum. This is one of the things the people do not want. Whatever else they do not want, they certainly do not want dishonesty, bribery and corruption and they do not want a Taoiseach and Ministers who call that kind of thing integrity, whose consciences are so dulled that they cannot distinguish between a bribe and a reasonable fee. They are against a building consortium set up in this country to pay off a few gentlemen who were subsequently to band together into a group called Taca. These are architects, quantity surveyors and engineers, and they are gathered together. Some of them are nice fellows, but they are there merely as sugar-coating for the pill. They are nice, innocent and uncommitted. This is the first time in the history of this or any country that we find the uncommitted paid so well.
On our regional technological colleges, of which there will be nine, there will be an expenditure of £7 million, and the price paid to this consortium, set up under the auspices of a Fianna Fáil Minister, for the deliberate purpose of giving them money—a practice which never obtained before— is five per cent, plus outlay. Outlay is all expenses incurred on whatever they do, and the five per cent is profit. Five per cent of £7 million is £350,000. I think there are seven of them, and that is £50,000 each as a little present.
The night after the referendum we had the disgusting public spectacle of the Leader of the Irish Government appearing with the chairman of Taca at what they called a seminar in Cork —a seminar on Taca in which the chairman of Taca said he was proud that he had never got any money out of an Irish Government or a State Department. He is part of the consortium that gets five per cent and outlay. Please God, the day is not too far distant when the people of this country will not only give us the opportunity of being the Government, but will also give us a mandate to deal with those people and find out how they got it, where they got it, how much, and who gave it to them.
During the course of this debate the Minister for Transport and Power found two Australian parallels for what happened in the referendum. Is it not extraordinary that he could not find those Australian parallels before the referendum and advise his Government accordingly? They might have rejected the proposals if the Irish people heard about those Australian parallels. We have the Minister for Agriculture and Fisheries rushing madly from farming debacles to partition politics. The Taoiseach called Captain O'Neill a moderate man. In my view that is probably an honest view held by the Taoiseach and its expression was probably calculated to do good, to weld together, perhaps, those people of different sects in Northern Ireland who were marching together as civil rights marchers.
The question of partition and civil rights is not relevant. It does not arise.
Then came the gentle little rebuke by the Taoiseach last night.
That is not relevant either. If the Deputy refuses to listen to the Chair, the Chair has no alternative but to ask him to resume his seat. We are not discussing Partition or utterances by the Minister for Agriculture and Fisheries or the Taoiseach. They do not arise.
Is there not money for the Department of External Affairs in this?
In taxation? Is the Chair seriously alleging that there is no money from the taxation inflicted on the people of this country going to the Department of External Affairs? Surely not?
I have already pointed out to the Deputy what is relevant and what is not relevant.
Is not the Department of External Affairs financed from taxation?
It is, but that does not open a debate on the administration of the Department. That does not arise and has never arisen.
In a general debate?
This is not a general debate. That is the difficulty for Deputy Lindsay.
If the Chair had read this evening's Evening Press he would see how important this is, because in his speech in Listowel last night the Minister for Agriculture is quoted as saying:
The recovery of the Six Counties was the foremost plank in the platform policy of Fianna Fáil. This was the foundation on which the organisation had been built.
That does not arise and I must rule it out of order.
The whole trouble is that it is about time to rule both the Taoiseach and the Minister for Agriculture and Fisheries out of order, even in public debate, before they finally engage in a major split on this performance. It is hard to know what it is about, and whether it is a bid for power or a joint agreement.
That does not arise. The Deputy should pay attention to the Chair.
God help the Deputy's clients if that is what he knows about his job.
I can do without any monetary help from 44 years of political codology.
The Deputy will not last another round and he knows it.
Who sent Deputy Corry in to interrupt me? Did someone send him in? Is he still the official mud-raker of the Fianna Fáil Party?
I was here 30 years before the Deputy.
We are not as old as he is.
I will be here 30 years after the Deputy if that will do him any good.
Even if Deputy Corry is here much longer he will still be without portfolio. In his opening speech on the financial statement, the Acting Minister for Finance, the Taoiseach, said last Thursday:
The Financial Motions on the Order Paper for today are a clear expression of the Government's sense of responsibility for good management of the economy. The Government have faith in the readiness of the Dáil and the people to support a Government which do their duty even in face of the temporary unpopularity this must at times entail. We will deserve best to retain the confidence of the people by showing both courage and responsibility.
Good management necessarily involves that all this should have been anticipated at the time of the framing of the annual Budget last March or April. Good management involves people making plans to meet all possible emergencies. They were not made. This became obvious about the middle of the year, but of course, the Government had no time then because they were busy educating the people about a proper electoral system.
The British system.
The British system, the Six County system, the beetgrowers' system.
The people resent this taxation. They resent it coming as it does hard on the heels of their own very positive rebuke to the Government. The rebuke was not so much against an attempt to impose on the electorate a system which they did not trust or want as against the way the country is being run. As Deputy O.J. Flanagan said in this House the other night every member of Taca has in his diary the private telephone number of each Minister and Parliamentary Secretary. We meet them on the corridors. They do not have to bother about coming to the gates or about the ushers. We meet them regularly in the corridors of the new building. We see them going into Minister's offices without being ushered in by ushers or private secretaries. They have open sesame to this House and all its corridors. What kind of open sesame have they to the Government offices where the real deal is shuffled? The people resent it all. Their resentment resulted in the avalanche of votes which they gave against the Government proposals. They resent these measures now and they will continue to resent them. It does not matter what is offered to them in March or April next by way of a sop from what is stolen from them now. They will resent it then.
Tomorrow morning when the constituencies Bill becomes available—if it does—and we see the gerrymandering effort from Donegal to Cork and from Dublin to Galway the resentment of the people will become greater. This Government at the next election whenever they decide to hold it—and the Taoiseach said here that they will hold it at a time advantageous to themselves and that they will hand on as long as they can—will suffer a still greater defeat.
Are you worried about the length of time you have left?
I will not be dependent on you anyway.
You will go anyway.
Is that a leak? Have you butchered my constituency? There is a leak from the Party room.
Mr. Brosnahan might get your seat.
There is the leak. I want to say to Deputy Corry before a general election, in case he comes back and I do not, that my reputation in the law courts of this country stands high. His does not and he knows it.
We will have a trial.
I think the title of chief mudslinger must belong fairly and squarely to Deputy Lindsay. It is the only thing he really excels in. He is a lawyer and I hate to think what kind of judge he would make.
A Daniel come to judgment.
He might be better than some people on the Bench already. Some of them did not even get 2,000 votes.
He has already adjudged us guilty of gerrymandering the constituencies. We know the accusations that will be levelled at the Government whatever way they revise the constituencies. It is, indeed, no pleasure as a serious-minded Deputy to listen to the kind of contribution made just now. I know many members of the Party opposite. Many of them are very decent men with some moral sense. I will say no more on that.
I dare you.
It never fails to amuse me how, every time the taxes are increased, that the Opposition Party always show surprise and astonishment.
These tax increases are regarded by every normal person as necessary in order to keep the economy balanced. Our economy is good. We intend to ensure that it remains sound. We would much rather raise taxes continuously than risk unemployment. This country knows the cost of having a Government that was afraid to introduce tough measures when they were necessary to rectify a situation. This Government have never failed to do it. All sorts of reasons have been attributed to this Government for introducing this tough Budget. We never called it a mini-Budget. That was a title attached to it. We just said there was a possibility of another Budget in the autumn. There is always this possibility. No matter what Government are in power and are doing their job they have to make sure that the situation does not deteriorate.
In 1965 we had a similar situation. The action which the Government took then proved to be correct. No unemployment followed. The charge levelled at us of introducing this Budget to get revenge on the people is one which not even the supporters of the Opposition themselves would support. No Party is going to commit suicide by introducing measures which are not necessary. When the people go to the polls they are very conscious of the fact whether or not they are working. This is the most important factor. Many years ago, when my father was being heckled at a meeting, somebody asked him: "What about the 2d on the pint"? He said: "Is it not better to put 2d on the pint and have 2d to pay for it than to take 2d off and not have the money to pay for it"? This to me is the right philosophy. Anybody who says that taxation will not continue to rise is trying to fool the people. The people do not expect this. In 1947 when I was fairly young I remember reading the debates and coming across the great promises made by Fine Gael. They promised if elected they would reduce taxation by £10 million. This was their promise and this is on the record. This was quickly forgotten. I would not blame them because it was obvious it was not possible.
They did reduce taxation.
They did not.
(Interruptions.)
Everything is being thrown into this debate. I realise the difficulty of keeping order Everything is being discussed from the referendum to Partition. There is no harm in reminding the members of the Labour Party and Fine Gael that they were the people who supported Partition.
What did Fianna Fáil do for the past 40 years?
That is a lie. That is a lot of nonsense. Deputy Corry knows otherwise.
It is an accurate point and I have made it.
It is an untruth.
What have Fianna Fáil done about it during the last 40 years? Nothing.
The question of Partition does not arise. Deputy Briscoe.
The Minister for Agriculture and Fisheries now tells us that he helped to put the Taoiseach where he is and that he has served him better than other Members.
Deputy Corish should not make these charges.
I should like to remind the Deputy that in 1925 the Boundary Commission Report was before this House and the Labour Party voted against it.
I should like to say, as a member of Fianna Fáil, that I make no apologies for supporting my Party in any unpopular measures when these measures are necessary to ensure the stability of the country. I should rather find myself either out of the Dáil or in Opposition than to sell my soul.
To the tune of £9 million.
I will never go before the people and say that everything is milk and honey. The job of a Deputy becomes more difficult. In America, where the standard of living is twice as high as ours, it will be found that the people are twice as discontented.
They have not Fianna Fáil.
We are living in the day of the great handout and, unfortunately, when you hand out you also have to pay. Opposition Deputies are saying give, give, give but do not collect. We have been in office now for——
Far too long.
——more than 40 years and we are continuing to defend our policies. Most of our young people cannot make comparisons with the Coalition days but if they get that opportunity—and I am not saying that they will—maybe that will be all that will be necessary to make them appreciate good Government, strong Government and a Government who are not corruptible. All sorts of charges have been levelled at us and I would be ruled out of order if I were to refer to all of them. The people know what the deliberate untruths of the Opposition Members are worth.
I shall conclude by saying that it is a most important aspect of our policy as a Government to ensure that employment continues to increase and that people do not lose their jobs.
According to the Taoiseach's figures there are 151,000 fewer people at work now than there were in 1951.
The Deputy is quite confused by the trends that are taking place in most countries. The fact is that the number of people in employment is increasing and those people in employment are much better off. The flight from the land has been referred to but this is something which continues in every country in Europe today. More and more people are being absorbed into industry.
No less than 300,000 people emigrated during the last ten years.
People who have come back during the last ten years and have seen the country know that it is in good shape. It is possibly in the best shape of most countries, economically speaking.
The shape of things to come.
We have continued to prosper. Our production rate has been continuously maintained at between 4½ and 5 per cent. This is very good.
Not anything like it.
As I have said, I am very happy and satisfied to support any measures which are absolutely necessary to maintain this country's economic stability.
What can we say about this Budget except to say that it is a savage attack on the people who told the Government that they resisted all activities by them to seek a dictatorship in this country. During the past eight or nine months we have seen this House engage itself in a fruitless exercise on the referendum. We have had to tolerate the Minister for Local Government, who should have been in charge of his Department, endeavouring to solve the housing problem that exists, but instead, he was burdening us with hours upon hours of nonsense about the straight vote.
We are living in an enlightened era. People are intelligent and they are thinking. They are not gullible any more and they saw very plainly through the Government's efforts to fool them. We saw the sop handed out in the last Budget in April. It was a deliberate attempt by the Government to fool the people into voting for them in the referendum. Of course, they said: "No matter what the figures are like, give them the little sop and they will fall for it again, just as they have done so many times, and they will give us those extra 33 seats which we need to dispose once and for all of any effective Opposition in this country." Deputy Boland and Deputy Blaney——
The two BP's of Fianna Fáil—Blaney power and Boland power.
——decided that, if there was to be a second Budget, it could be left until after the referendum. "Leave it until after October. They will then be fed up listening to the speeches and then we will ask them to decide." However, the people are very intelligent now and they decided that this would not be done. They decided they would not be fooled by any sops in an April Budget—this Budget of expediency. Last April I said it was a trick Budget and I said also that the Minister for Finance should resign, that he was not aware of the situation in the country. I say again that we have an incompetent Minister for Finance. I call upon him to resign. Just imagine a Minister who was not aware of what was happening in his Department. It had been well known that he was at cross purposes, anyway, with his Department for the past few months.
We see a Government in office today with no proper economic policy, no planning, just a day-to-day attempt to run the country and then, on to tomorrow when it comes. That is the attitude. I hear Deputies say: "It is not all milk and honey." It has never been all milk and honey when Fianna Fáil have been in office. We do not know the day when we shall be told that there is a financial catastrophe in the country, that "things are bad", and so on. Have we reached the stage when one Budget per year cannot suffice for this Government? I am wondering whether, next year, if this Party are in office, we shall have a third Budget or whether we shall have a monthly Budget from them.
I have listened attentively to the views of people on this Budget. I can tell Deputy Briscoe, who says he makes no apology for it, that if he talks to the people of his constituency he will very readily learn how they feel and he will very quickly have apologies to make for this Budget. If it were left to the people, this Government would not now get 30 seats. The people are sick and tired of a Party that has contrived and sought by every trick to fool them. The people are aware that the present Government are once again trying to fool them.
A tough Party for a young man.
Remember, the people will not be fooled the next time. Every means will be contrived to hold off a general election in the hope of "coming up" with something in the Spring but, this time, no matter how devious they may be, Fianna Fáil will not hoodwink the people. I do not think a Government can run a country with tricks and falsehoods. The people will decide.
I agree that it is easy to criticise but what we say is, and we have suggested it as constructive criticism, that there should be proper planning by the Government. They are taking no measures whatsoever to solve our unemployment situation which today amounts to 55,000 people unemployed. We have 3,000 more unemployed this year than last year. The unemployment situation has progressively been getting worse. What do we expect? Before this Government go out of office there will be at least another 3,000 people unemployed. We should get rid of this Government as quickly as possible.
The referendum result was a clear indication that our people are dissatisfied with the Fianna Fáil Party. The people should be given an opportunity to express themselves in a general election. This country needs a general election from the point of view of a solution of its problems. I do not think the Fianna Fáil Party are the only Party to run this country. I think they have believed, themselves, that they have a divine right to rule.
Misrule.
I think this is a fallacy. Perhaps blame attaches to the Opposition in this connection in so far as they have developed an inferiority complex about this Government. I think the general feeling has been that they are the only Party. I think this is all over now. The time has come for the Opposition to assert themselves and to decide that an alternative Government can rule effectively and put into operation a proper economic policy that can solve the problems of this country today.
Labour will have enough candidates in the next general election to enable it to form a Government.
We know what Fianna Fáil's priorities are at the moment. Deputy Blaney is giving them to us. We read the banner headlines of this evening's Evening Press“Blaney back on Partition again”.
The Labour Party can effectively solve the problems facing the country. The Labour Party's economic policy can ensure that we have a proper policy that will last us right through the term of office. There will be no attempt at a day-to-day policy to suit the day or to suit the occasion. We shall get our priorities right. These are the things that matter. Proper social policies are essential— proper housing and health programmes.
The only way to get rid of the Taca organisation is to get rid of the Government that founded it. The chairman of Taca has said he can honestly say that no member of Taca made any money out of its connection with the Government. I would say that that is a downright lie. I know a member of Taca who uses his office as a Fianna Fáil headquarters and that same member has got the Government contracts for housing and for heating.
That is not accidental.
This particular office is frequented daily by the Minister for Finance and the former Taoiseach, Deputy Seán Lemass.
That has nothing to do with the motion before the House.
I submit it is relevant in the context in which I am speaking.
That is where the money is going.
It is just as relevant as Deputy Briscoe's remark in relation to Partition and the Labour Party.
The Deputy must keep to the discussion of the motion.
The eyes of the people have been opened to the corruption that has gone on. No Budget in April, however light it may be, will fool the people into thinking that Fianna Fáil are an honest Government. The proposed taxes are harsh and savage. They represent another attempt, through indirect taxation, to victimise the working man and to make life more and more difficult for the poorer sections of our community. This mini-Budget will initiate a further wage claim by all sections of the community and will send the cost of living spiralling. It will make life more and more difficult for those on fixed pensions. It will create more and more friction and more and more dissatisfaction. I will even go so far as to say it will create more and more trouble. It will foment trouble. We shall have more demands. The people who will benefit by this mini-Budget are the friends of the Fianna Fáil Party.
I wonder why it is becoming a fashion nowadays to have a second Budget in the year. We had it twice in the lifetime of the present Dáil. Deputy Corish brought up this point in April when he said he felt sure this Government would introduce a second Budget in the autumn. Now we shall distrust them with their April Budget. I do not think any attempts of theirs to gerrymander constituencies will save them or solve their problem. The people will watch carefully to see what revenue these measures will bring in.
Fianna Fáil have wasted many months. There are many Bills to bring before the Dáil this session. The one on health is overdue for two years. It is promised for this session. Unless it is brought in and implemented within the next six months the doctors will refuse to operate the present health system. There is tremendous discontent, and the Minister is being grossly incompetent in his office. The people who are suffering so badly under this health system will revolt at the inadequate dispensary system that is being provided for them.
This would be a matter for the Estimate, not for the financial motion.
There will be more to be said on it. This is all an indication of mismanagement by Ministers in every Department. We see the Minister for Agriculture and Fisheries who tries jackboot tactics on the farmers.
The Minister for Aggravation.
The farmers are getting a raw deal from a Minister who refuses to meet them. I do not represent a rural constituency, but it is very wrong that any Minister should regard himself as above the farmers. He has a duty to meet sections of the community he is supposed to represent. The mismanagement in that field alone is so blatant that we should call on the Minister for Agriculture and Fisheries to resign. He cannot fool us with talk of Partition, and he cannot fool the people with his sudden championing of republicanism and his effort to disguise the real issues which are at stake.
He is just putting up a smokescreen because he has been sacked.
The friction within his own Party is showing itself in attempts by him to gain control, and we can expect anytime to see the Taoiseach replaced.
This does not arise on the debate on the motion.
If Ministers would spend more time in charge of their own Departments we might get a more efficient Government, and I am giving that as the reason for mismanagement in each and every Department. We have the Minister for Local Government who should have been dealing with the housing situation; instead he preferred to travel the country——
He attacked "socalled clerics".
——discussing the referendum. He refuses to acknowledge that we have a housing crisis, and instead forced on the people a referendum for which they had no desire whatsoever. I am wondering what will be the extent of unemployment following the measures in this Budget. I only hope the Government will be out before they do more damage. It is time now for a new Government to try to repair the damage that has been done to our economy by this ineffective Government. It is important that decisions be made shortly. It would be very wrong for this Government to hang on to office when they know quite well it is the wish of the people that the matter be decided at a general election. The Taoiseach's motion of confidence in the Government was ludicrous in the light of the clear decision made by the people recently.
We won, did we not?
The referendum?
The vote of confidence in the Government.
It is about all you would win now.
It was a consolation prize self-presented.
If the Government had the courage to let the electorate decide the major economic problem that afflicts the country today would be solved.
They do not want to walk the plank.
By raising £9 million extra through these savage taxes they hope to be able to present a face-saving Budget in April. Do they honestly think the people can be fooled to such an extent? Perhaps it could be done up to five years ago, but those days are over for the Fianna Fáil Party. I do not think Taca will save them. I do not think their State-controlled television will save them. It is important for the people to make known their views, and unless we have a change in the near future, this country can go on to economic doom.
Deputy T. O'Donnell.
Am I not in turn, a Cheann Comhairle?
No, the Deputy is not in turn. Deputy O'Donnell offered three times.
With respect, surely it is going in rotation?
Deputy Briscoe spoke before Deputy O'Connell, and I think Fine Gael are now entitled to a speaker.
Deputy Andrews has not been in the House long enough to understand that.
I have nothing personal against Deputy O'Donnell.
That this supplementary Budget should be necessary is a terrible indictment of the economic policies pursued by the Government in recent years. The Budget is the price the people will have to pay for the failure of the Second Programme; it is the price also which the people have to pay for the fact that during the past six months the Taoiseach and his Ministers have been gadding about the country instead of looking after their respective Departments, in an attempt to rig the electoral system for their own ends.
There is no doubt in my mind that the Second Programme has proved a costly fiasco. In practically every sector of the economy there has been failure to reach the targets set, and in one or two sectors, such as the dairying industry, where milk production has reached the target, it has precipitated almost a financial crisis. Despite the additional taxation levied in this Supplementary Budget, there is nothing in it at all to indicate new thinking by the Government in respect of the economic and social problems of the country. There is nothing in the Budget which will solve the present serious crisis in the agricultural industry; there is nothing in it to accelerate the growth in industrial development or to solve our serious unemployment problem; there is nothing in it to indicate the introduction of new and much needed health services; there is nothing in it to offset the increased taxation which will fall so heavily on the poorer sections of the community.
Indeed, the Taoiseach's speech in introducing the Budget clearly indicated his own inability and the inability of his Government to face up to the serious economic and social problems which confront the country. The Taoiseach's speech was uninspiring, unimaginative and totally unconvincing in so far as it referred to the serious problems to which I have referred. This Budget is merely a stop-gap measure designed to cover the mismanagement and inefficiency of the present Government.
After 11 years of continuous Fianna Fáil rule, particularly after the First and Second Programmes for Economic Expansion, it is, as I have already said, a terrible indictment of the Government and their policies that we should have reached a situation in which for the second time in 1968 a Budget should have to be introduced for the sole purpose of trying to patch up the mistakes made in April. Whether this was deliberate or not I am not competent to say, but it is a terrible state of affairs that we should have a Supplementary Budget to raise the additional taxation which it imposes, taxation far more severe than in the main Budget in April and probably more severe than in any Budget in recent times.
In his speech last Tuesday the Taoiseach dwelt at length on our major national industry, agriculture. He dealt in detail with the problems of the most important sector of agriculture, the dairying industry. He is reported at column 2054 of volume 236 of the Official Report as follows:
A few facts about milk may help to put the problem in perspective. This year about 520 million gallons of milk will be delivered to creameries.
He went on to speak about the difficulties which have arisen in the export market, the difficulties which this increased milk production for the export market will give rise to. He did not say that the 520 million gallons of milk, the estimated output in 1968, represent approximately the target set in the Second Programme for Economic Expansion in 1964 for milk output. That Programme, in so far as it relates to prospects for agriculture in its various sectors, forecast that milk production would have reached 550 million gallons annually towards the end of the decade. In 1968, according to the Taoiseach's estimate, 520 million gallons will be produced. The Taoiseach referred to the problems this gives rise to on the export market—the problems of surplus, of increased Exchequer payments and so forth—and he then stated that this high rate of subsidy is justified on the basis that the associated production of cattle and beef is of great value to the economy.
The Taoiseach gave his views on the dairying industry and I want to give my views on it as well because the Taoiseach did not give the two sides of the story. He bemoaned the higher Exchequer payment to the dairying industry and the fact that the increased milk production had led to increased Exchequer payments, but he did not spell out for us the contribution which this industry is making to the national economy. He did not say that this subsidy is justified because of the fact that the dairying industry provides employment for 110,000 dairy farmers and their families, or to the fact that in 1968, if my memory serves me correctly, exports of dairy produce will amount to approximately almost £30 million. The Taoiseach did not refer to the fact that the dairying industry is the foundation of our cattle trade— that we cannot have more cattle unless we have more cows.
All this was anticipated in the Second Programme. One of the purposes of the heifer scheme, which was introduced a couple of years ago and to which the Taoiseach also referred, was to increase the cow population of this country. Of course, as we all know, the heifer scheme did not achieve what it set out to do.
What about the dual-purpose cow?
For all practical purposes the heifer scheme was a complete failure. I wish to emphasise that the Exchequer subsidy to the dairying industry is justified for the reason I mentioned—that 110,000 dairy farmers and their families are directly employed in it and that 8,950 people are employed in the processing section, in our creameries and processing factories. All these factors should be taken into account before we come to bemoan the fact that increased milk production is costing the Exchequer so much. The Taoiseach then, as an earnest of his goodwill and appreciation of the fact that problems have arisen in the dairying industry, announced that it was intended to give an increase of a penny per gallon on the first 7,000 gallons of milk produced.
The impression has been created abroad that one of the main reasons for the introduction of his supplementary Budget is that the farming community are costing the Government more to support them. An entirely false picture has been painted. This 1d per gallon on the first 7,000 gallons, for which provision has been made in the present Budget, is, as I described it last week at Question Time, a complete joke. It is totally inadequate. It bears no relationship whatsoever to the increased costs which the dairy farmer has to meet in 1968. It is completely out of reality with the present situation.
The Minister for Agriculture and Fisheries, in the course of his speech last week on the confidence motion, gave a whole lot of statistics in relation to the Government's support of agriculture. It is the height of foolishness to try and prove by quoting by many million pounds that all this money is going into the pockets of the dairy farmers. I have taken the trouble over the last four days to do a survey among the dairy farmers and creameries in my constituency. The results of my survey show that the average price per gallon which the dairy farmers in County Limerick are receiving in 1968, for the months of June, July, August, September and October, is 2.1 pence per gallon less than they received in 1967. I defy contradiction on this and I defy the Minister for Agriculture and Fisheries to go along to Limerick and ask the creameries there what price they paid to the dairy farmers this year.
There has been a reduction in their incomes of 2.1d per gallon and, when we relate that to 1d per gallon on the first 7,000 gallons, it produces a ridiculous situation. The 1d on the first 7,000 gallons is totally inadequate. Why has the income of the dairy farmers dropped? It has dropped for three main reasons. In the months of May and June, 1968, we had the outrageous situation that hundreds of thousands of gallons of skim milk had to be poured down the drains because the Government took no steps to ensure that the market would be adequate to take all the milk.
A Question which Deputy Collins put down in this House last July would indicate that approximately 1 million gallons were poured down the drains in County Limerick. There has been a reduction of something over 1d per gallon on skim milk this year. Then we had the increase of the Bord Bainne levy of five-eighth pence per gallon. We had an increase in overhead charges which makes the whole thing add up to the figures I have already given. The average price the dairy farmers received this year is 2.1d per gallon less than last year.
Can any member of the Government prove to me that 1d per gallon on the first 7,000 gallons, retrospective to 1st September, will compensate the dairy farmers for the loss they have sustained. Deputy J. O'Leary said earlier this evening that it was a breakthrough and introduced a move forward in the method of payment for milk in the creameries, that it introduced a new principle. It introduced what has come to be known as the two-tier price. It is the brain child of the late John Feeley who was president of the Irish Creamery Milk Suppliers Association, and it has been the main point of that organisation's argument with the Government in recent years. The two-tier price system for milk is a good system but the differential of 1d per gallon is totally unrealistic.
I take it, certainly from reading the Taoiseach's speech, that one of the reasons for the introduction of this was to try and curtail the production of milk. In other words, when the dairy farmers reach their 7,000 gallons annual output figure they may ask themselves is it worth while producing any more than 7,000 gallons per annum because on anything over 7,000 gallons they will be paid a lower price. The two-tier system could work but the differential would have to be a minimum of 4d per gallon. This is the figure which, in 1966, the Irish Creamery Milk Suppliers Association deemed a desirable one. In other words, if this two-tier system and the increase announced by the Taoiseach last week were to make any impact at all, if it were to compensate the dairy farmers for the losses they have sustained this year, the increase on the first 7,000 gallons would have to be at least 4d per gallon.
The Taoiseach is very concerned throughout his speech with the fact that there seems to be over-production of milk, that there is increasing difficulty in disposing of all the milk produced and that this has constituted a serious problem for the country and the Exchequer. I do not agree at all with the Taoiseach that there is over-production of milk, nor do I agree that the difficulties that have arisen in the dairy export market this year, and to which the Taoiseach has referred, should mean that we now panic and endeavour to reduce the output of milk in the coming year. There was a difficulty in one sector of the dairy export market this year. That was in the skim milk powder sector but the latest information I have shows that in the past two months there has been a considerable recovery in the export price for skim milk powder. Last July the price had dropped to £50-£54 but I understand that in the month of October this price recovered and it is now running at £80 in the export market.
I do not concede at all that there is over-production or that the dairy farmers should be discouraged from producing more milk. Much of the increased milk output is due to the fact that the dairy farmers answered the appeal of the Government since the introduction of the Second Programme for Economic Expansion. The dairy farmers answered the Government's appeal. They increased the stockcarrying capacity of their farms. They increased their efficiency. They improved the quality of the milk going to the creamery. Now, just because there had been a slight problem in one sector of the dairy export market, the Government are panicking and the impression is being created that we have a surplus milk production and that this is bad.
There is plenty of scope for diversifying milk processing. If there is a problem in the powdered milk market, there is scope in other types of dairy products to which this country has not turned its attention at all or at least very little. For example, there is a growing export market for casein. There are two types of casein. One type is acid casein and there is a growing export market for it. The production of acid casein is a relatively simple matter and can be done without the introduction of costly machinery or anything else. There is plenty of scope for increasing the consumption of dairy products here at home.
While progress has been made by the National Dairy Publicity Council I am not satisfied and most people connected with the dairying industry, particularly dairy farmers, are not satisfied with the efforts that have been made to increase the consumption of dairy products here at home. Certain progress has been made in increasing the consumption of cheese. There is a good potential for the export of fresh cream to the British market and to other countries and there is unlimited scope for milk powder in the Far East. In fact, it was announced by Bord Bainne within the last year that plans were being formulated for establishing special processing plants in Far Eastern countries where the milk powder could be re-constituted and this would overcome the climatic problems which tend to affect milk powder going out from here. Surely, in view of the tragedy in Biafra and the starvation and malnutrition in so many countries abroad, it should be possible for us to devise some scheme whereby our milk output could be utilised properly and economically? It should not be necessary, and it is entirely indefensible, that in one county alone one million gallons of skim were poured down the drain.
The Taoiseach, in his Budget speech, and the Minister for Agriculture and Fisheries last week, in his speech on the confidence motion, and the Government have gone at length into this problem. I feel that the Minister for Agriculture and Fisheries does not know what is happening. He has no conception of what is happening, especially in the dairy industry. He is completely out of touch. If it were not for the fact that he is completely out of touch, neither he nor the Taoiseach would have the audacity to come in here to the Dáil and announce the 1d per gallon increase on the first 7,000 gallons of milk retrospective to 1st September. They would not have the audacity to expect that the dairy farmers of this country would accept this as being anything like reasonable compensation for the losses they have sustained this year, losses which they sustained because of the fact that they responded to the Government's call for increased production and losses which they sustained because of the failure of the Government to increase the processing capacity of the various milk plants throughout the country.
This £8 beef subsidy is a complete dead loss altogether. I am completely opposed to it. It is certainly not going to achieve what the Government think it is going to achieve. In view of the fact that the dairy herd owners who are producing milk commercially are excluded from it, who is it going to benefit? It will probably benefit many of the people who benefited from the heifer scheme, that is the large ranchers in the Midlands and elsewhere who can afford to keep large numbers of heifers. I personally do not see any hope of this £8 beef subsidy achieving what the Government hope it will achieve.
There is nothing in this Budget, making allowance for the fact that there is a penny per gallon on the first 7,000 gallons, which indicates a new approach on the part of the Government towards the serious problems that confront our major national industry at the present time. There is nothing in the Taoiseach's speech except the picture which he has painted of the problems created by the increased milk output this year. Indeed, it is ludicrous to hear Fianna Fáil spokesmen bemoaning the fact that, for the simple reason that we had a fine summer and that there had been an increased return in certain lines of production such as what, this should have the effect of precipitating a financial crisis and that it should have justified the introduction of this supplementary Budget. I want to say that I reject entirely the Taoiseach's arguments here in relation to the dairy industry. I believe that he and particularly the Minister for Agriculture and Fisheries are completely out of touch with reality, and I see no hope for any improvement in the relationship between the agricultural community and the Government while the present Minister for Agriculture and Fisheries occupies that post.
In the final analysis the acid test of Government policy for me and most Deputies, while it can be measured in terms of millions of pounds and hundreds of millions of pounds, as the Taoiseach and the Minister for Agriculture and Fisheries trotted out last week, is the result of that policy as we can find in our own constituencies. I regard myself as a grass roots politician. I am proud of the fact. When I look at my constituency and when I analyse the supplementary Budget in relation to the problems of my constituency I find that there is nothing in it other than the miserable penny for the first 7,000 gallons of milk, which will mean a few pounds per dairy farmer between now and Christmas.
There is nothing whatsoever in the Budget that would indicate that the Government are making provision for higher educational facilities, for the university that we so badly need in Limerick and for which we have fought for such a long time. The Minister for Education in his speech in Galway last night seemed to have thrown it out completely. There is no hope in this Budget for the hundreds of students who are now in secondary schools in that region and who want to proceed to higher studies and cannot do so because their parents cannot afford to send them to one of the existing university institutions. There is nothing in this Budget which holds out any hope for the 4,085 who are unemployed in the city and county of Limerick at present. There is no evidence that this supplementary Budget is going to break through the industrial stagnation that is in Limerick city for the past ten years, where we have the situation that since the last general election not one new industry has been established and where unemployment has mounted all the time and is continuing to increase. There is no evidence in this supplementary Budget any more than there was in the main Budget in April that the Government intend to tackle the numerous other serious problems that affect not merely my constituency of Limerick city but the county at large.
The necessity for this Budget is a terrible indictment of the economic policy pursued by the Government for so long. This Budget writes "finis" to the Second Programme for Economic Expansion. God forbid that I should ever be regarded as an economist but I regard this supplementary Budget as the end of the road so far as economic programming is concerned, as understood by Fianna Fáil, because the Second Programme for Economic Expansion has been a complete fiasco. The targets have not been reached. In a couple of sectors in relation to milk production and wheat production, where the targets have been reached there is hullabaloo and cries of overproduction and no provision has been made to dispose of the increased production.
The increased taxation in this supplementary Budget will hit whole sections of the community. Any Deputy whose constituency embraces urban areas, as mine does, is only too well aware of the plight of many hundreds of old people, old age pensioners and those living on small pensions. The Minister for Transport and Power is very well aware of one section of the community that is forced to live on very small pensions, the CIE pensioners. I want to be fair, and I always am, and I am glad that some increase was given to them. When the pre-1963 pensioners got an increase of 10/- a week retrospective to the 1st January I welcomed that publicly at the time but I sincerely hope it will be possible to give them a further increase at a not too distant date. I am grieved at the fact that the increased taxation in this Budget is going to hit the poor, the needy, the aged and the infirm, and that no provision has been made to off-set the effects of that increased taxation on these needy categories in our community.
Deputy John O'Connell, in his flagrantly dishonest speech, suggested that he had constructive criticism to offer the Government Party. He said it was easy to criticise but his form of constructive criticism was that there must be proper economic planning. That sort of generalisation is typical of the simpliciter approach of the Opposition to this debate. It is the approach that has been demonstrated by them in their speeches for some years past, an approach which has not much responsibility attached to it. It is quite easy for the Opposition and for Fine Gael to say in generalisations what should and should not be done — full stop. That is the simpliciter approach: Let us govern; we will do a better job. That has been the tone of the debate so far with the exception of the speech of Deputy O'Donnell who is a fair-minded Deputy. We heard Fine Gael with their “Just Society” and the crypto-socialist Labour Party with their socialist shibboleths—more of the generalisations that have bedevilled politics in this country for years past, the easy catch-cry and the meaningless phrase. This has been the Opposition's part in Irish politics for years past. They are clearly an Opposition that does not want to govern. They want to remain in Opposition; it is the easy way out.
And the Deputy is really worried about this?
We would not attempt to call this Budget an easy one. However, the Government have not run away from their responsibilities. We know the history of Fine Gael in this respect in 1957. When there was a motion of no confidence put down, they refused to face up to it. They went to the electorate and were beaten as they deserved. We are prepared to face up to our responsibilities and we faced the motion of no confidence and overcame it. Perhaps the national anthem of the Fianna Fáil Party might be appropriately at this point in time a song that is used by many people: "We shall overcome".
Under this much-criticised Government expenditure has been widely spread and tremendous efforts have been made to further social and economic development and towards improving the lot of all sections of the community. Some political Parties have attempted to play one section of the community against another. That is irresponsible. We recognise our responsibility as a Party to the whole country and all sections irrespective of class or creed. This has been the greatness of Fianna Fáil over the years and in my humble opinion it will be their greatness in future because honesty, freedom, fair play and social justice must prevail. We do not deal in shibboleths but in honest policies.
Let us look at the question of Government expenditure: this is the only way to give the lie to the suggestion that the Government have been doing nothing. We have been doing a considerable amount. What has been done has been done by the Fianna Fáil Party over the past decade because the people have seen fit to give us the responsibility to govern. At the next or any subsequent general election the people will see fit again to accept or reject us and it is the people in the final analysis who give the answer as to whether the Government shall or shall not continue to govern and not any political Party or Parties. We must not get away from the idea that the Government hold the country in trust for the people. Additional sums have been allocated for housing subsidies, for water and sewerage schemes, for tourism, rural electrification and An Chomhairle Oiliúna. These are among a number of the progressive and beneficial steps taken by this Government at this time. During the debate on the motion of no confidence we had the Leader of the Opposition starting off his speech by talking about honesty, freedom and social justice —á la Fine Gael.
On this question of social justice I will briefly refer, if I may, to a number of situations which have arisen in the Borough of Dún Laoghaire. We had a magnificient offer there of a semi-State hotel being made available to the community but the Fine Gael dominated borough council turned down planning permission for that magnificient project. If this hotel comes, as I hope it will, it will give employment to 250 people full-time and 350 at the height of the tourist season. It will bring in £250,000 in local expenditure in the first year of its operation. The plans for this hotel were turned down by the Fine Gael dominated council, and this we are told is social justice. Surely social justice means the giving of employment to people but here we get a lecture from the Leader of Fine Gael about what social justice is or is not. If he had any control over the Fine Gael councillors in the borough he would have told them to uphold that planning permission and to give jobs to 350 people. This is what social justice is all about.
Again, on the question of houses which we require so very badly in the Borough of Dún Laoghaire, there was an opportunity some years ago to buy land at reasonable rates but, again, the Fine Gael dominated council turned down the serviced sites which were then available and which will now cost a considerable sum of money. This, again, is social justice, according to the Fine Gael Party. Then, again, the car ferry was turned down by the Fine Gael dominated members of the borough council but despite the Fine Gael Party the car ferry materialised. Despite the Fine Gael Party housing in the borough will continue. So much for social justice á la Fine Gael.
On the question of social expenditure — and I take social expenditure to mean current Government outlay on social welfare, education and health — this has more than doubled in the past decade. In 1958-59 the expenditure was £47 million and in the current financial year the total expenditure will be £110 million. These are considerable improvements on what was not done when a Coalition were in power. I will deal with the question of coalition in the course of my contribution, my brief contribution as I do not believe in holding up the House at any great length and, in fact, I think there should be some curtailment of the amount of time given to each Deputy but this, of course, is a matter for another committee of the House and it does not arise at this particular time.
On the question of social welfare, increases have been given in social welfare payments by this Government in every Budget introduced in the past nine years. In referring to social welfare payments I am referring to payments given to the aged, the widows, the blind, the disabled and the unemployed. These are the people who benefit and have benefited from the increases and who will benefit by other increases which will come in the future. What I am going to say now may not strictly arise on this debate but it is related to this question of widows. I have, as a politician, experience of a number of cases concerning deserted wives. I dealt with one such case the other day. It involved a husband who deserted his wife 14 years ago. This woman does not qualify for any benefit or whatever benefit she is entitled to is very small. It is a tragedy that deserted wives are not properly dealt with. I do know that the Minister for Justice will bring up to date the legislation introduced at the end of the last century and deal in some detail with the position of maintenance for deserted wives. It is very important that this legislation should be updated as a matter of extreme urgency. A deserted wife is a member of the tribe and the tribal chieftains, namely, the Government, have an inalienable duty to her.
I do not like to interrupt the Deputy but he would seem to be going outside the scope of the Budget and going into detail.
I appreciate that, Sir. To conclude on that, when the Minister is dealing with the matter he might also take into consideration the position of mothers with illegitimate children. This is another very important piece of social legislation which demands urgent attention. This legislation depends on an Act of 1930. The instalment order, ironically called, is £1 a week. These are matters of extreme urgency which should have immediate attention. I am grateful to the Leas-Cheann Comhairle for allowing me to mention these points which are, as he says, really outside the scope of this debate.
In regard to criticism of this administration, the Fianna Fáil Government introduced the contributory old age pension of 1961, the provision of allowances for children of old age pensioners in 1964. They also introduced the occupational injuries benefit scheme and the abolition of the employment period orders, lengthening the period of eligibility for unemployment benefit, and they also introduced the provision for free electricity and transport for old age pensioners. These are just some of the problems which have been dealt with by this administration over the past ten years. They are matters about which we must keep reminding ourselves in order to disabuse the Opposition of their catch-cries and generalisations. In addition, they introduced benefits for members of the Republican Army, the men who did so much for the country in those dark and evil days when it was not so popular to take one's life in one's hands. This is not the sort of idealism demanded today but it was an idealism which was important at that time. Again, we have extended free electricity and free transport to old IRA men and women. It is only right, and it is consistent with the policy of social justice being put forward by this Party, to make such provisions. I will not deal with the Old IRA now as it would be more appropriately discussed on the relevant Estimate.
In regard to old age pensioners and the production of their old age pension books, I would say that it is difficult to expect our senior citizens to produce their books on buses. Surely the answer is to introduce bus passes. This is a simple matter which should be dealt with as a matter of urgency. It is rather undignified to have our senior citizens producing their pension books out of their pockets and it embarrasses them as well as the conductors. I would urge that bus passes should be given to our senior citizens.
The Exchequer expenditure for 1968-69 on social welfare will be £48 million and combined with insurance contributions it will total £80 million. Expenditure on education doubled over the last five years and trebled during the last decade. Surely it has come to be recognised both in this House and in the country that any progressive steps taken since the late great Minister for Education, Deputy Donogh O'Malley, began his free education scheme have been taken and will continue to be taken by the Fianna Fáil Party?
There has at last been a breath of fresh air blown into the field of education. It is a difficult field but the Fianna Fáil Government must take responsibility for the improvements in this field and there is no gainsaying that. The improvements are ascertainable facts. We are in government and what has been done during our period of office is there to see and no amount of abuse or name calling can gainsay the facts. As my senior colleague, Deputy Corry, would say: "These are facts." They are facts.
Current expenditure on education has doubled in the past five years and trebled in the past ten years. New schools have been built and improvements have been made in our universities, and so on. Surely, that reflects the Government's desire to give every child the highest level of education from which its natural talents will benefit.
On the health services, benefits and contributions have doubled in the past five years and trebled in the last decade. The Minister in his Budget speech in April last referred to the fact that health charges have become a critical burden and a penal tax—these are my words — on the taxpayers and ratepayers and he suggested an insurance or contributory scheme to finance at least part of the cost. I strongly urge the introduction of a different form of taxation from the present penal tax. It is a penal tax on people in urban areas in particular. They find it very difficult to pay. An alternative must be found. Now that we have decided what the alternative should be, let us act. We want action. We must act now on the deliberations of the committees set up to deal with the problem of rates.
The Minister also dealt with the re-organisation of the public service. The report on this should be expedited. I do not reflect in any way on public servants. Civil servants are people of integrity. They have never been found wanting. But there is public disquiet over the organisation and re-organisation of the Civil Service. Whereas I have very good personal relations with civil servants, nevertheless, I know that there is from time to time duplication, triplication and quadruplication of effort and a waste of time. These are matters that should be inquired into. We cannot afford to waste any more time talking about re-organisation in this sphere. The report is a matter of urgency and its implementation will be a matter of equal urgency.
In regard to social welfare, in some instances social welfare payments go to the wrong people. In my respectful submission children's allowances are one example of this. This may not be popular, but I think many people could forgo their benefits thereby making it possible to increase the benefits for those most in need of them. There should be selective children's allowances. At the moment the State is spending £10 million on these allowances. It is a pity that they should be an overall blanket benefit. They go to all regardless of income. I would urge the Minister for Social Welfare to take some action in this respect; in other words, I would urge the Minister to introduce selective children's allowances.
With a means test?
Selective children's allowances. I do not need to enlarge on that. Let the Deputy use his own wit.
Is that Government policy?
It is a personal opinion. I do not have to be horsewhipped for expressing a personal opinion here.
(Interruptions.)
Order.
It is one of the great drawbacks of Irish politics that if a member of a political Party expresses an independent point of view he is immediately condemned as being disloyal. This is a tragedy.
I did not do that.
I did not suggest the Deputy did, but it is the general trend. It is a pity politicians do not stand up from time to time and say what they think, regardless of Party. That is what is wanted in Irish politics. That is what is lacking. I do not want to be publicly horsewhipped for expressing a point of view which may, or may not, be consistent with my Party's policy. I express it as a personal opinion and I make no apology to anyone for doing so.
(Interruptions.)
The question of Partition was dealt with. I know it is not strictly relevant but there was a great deal of denigration of a member of my Party who had the courage to say what he thought. This is all part of the malaise of the body politic. If someone expresses an independent viewpoint he is immediately condemned as disloyal. Not one member of the Opposition has come out and expressed a point of view on Partition but they have sniped at the Minister for Agriculture and Fisheries——
I do not like to interrupt the Deputy——
——and they have been sniping at the Taoiseach for the past week. We have not heard one viewpoint from the Opposition. We do not know what their point of view is on Partition.
What the Deputy really means is that the Taoiseach and the Minister for Agriculture and Fisheries have been sniping at one another.
Again, this is irrelevant to the discussion on the motion and I do not want to allow the discussion to become too wide.
Where is Cabinet responsibility when you have the Taoiseach on one line and the Minister for Agriculture and Fisheries on another?
I should not like to do anything that would upset you, a Leas-Cheann Comhairle, but I think it is important that I should be allowed to deal with this matter. It has been going on now for the last week and the Opposition in the confidence motion criticised Government Ministers for their point of view on Partition and criticised the Taoiseach for his point of view on Partition.
If we were discussing a motion of confidence this would be relevant certainly, but we are discussing a financial resolution.
With great respect, I did not get an opportunity of speaking on the confidence motion due to some Party arrangement which prevented most backbenchers from speaking. This is one of the problems we come up against: agreements are made and one does not have an opportunity under those agreements to express a point of view on national issues, however humble that point of view may be. The Opposition have run away from their responsibility. They will not say as members of an Opposition, what they think should be done in relation to Partition. What is the Opposition's point of view?
What do Fianna Fáil think, when we have the Taoiseach saying one thing and the Minister for Agriculture and Fisheries another?
Let us have Deputy Cosgrave's point of view on Partition, and Deputy Corish's point of view on Partition.
The Deputy is selecting a platform to get away from the Budget and the referendum.
Let us have a united front.
There is not a united front in the Fianna Fáil Party.
We cannot proceed on the basis of question and answer.
I very much appreciate the Chair's tolerance in allowing me to go somewhat outside the ambit of the debate, and the time I was allowed for my speech.
I am not a bit surprised that Deputy Andrews found it difficult to confine himself to the matter before the House because, during the debate on the no confidence motion, at least one Minister thought we were discussing the Budget and suggested on a point of order that someone speaking in the debate was out of order. Deputy Andrews, of course, is one of the new type of what I think they call "don" socialists who learn their socialism in the universities and find it quite safe to express it in this House so long as it does not affect their incomes.
I will not transgress the Rules of the House by following the numerous hares which Deputy Andrews let loose this evening, except to express surprise that the matters which he was allowed to discuss in a Budget debate should have arisen at all. I should like, however, to say that if he wants to know what we in the Labour Party feel about Partition, we believe now, as we always did, in a 32 County Republic. We believe that must be attained. We have never backed down on that, and we do not propose to back down on it to please Captain O'Neill or anyone else.
Deputy Andrews said that when Deputy O'Connell was speaking from these benches he made what Deputy Andrews called generalisations on Government policy and on the Budget. Unfortunately, Deputy Andrews is not long enough in this House to remember a gentleman named Deputy Seán Lemass who was Taoiseach for quite a long time. He was in Opposition for two short periods and during one of his periods in Opposition he became very annoyed when it was suggested to him that he had any responsibility for Government policy or for changing Government policy. He said it was not their business to point out what the Government should do. He said it was the Government's business.
I am replying to Deputy Andrews that it is the Government's business to formulate policy and to run the country while they are in office. If they cannot, if they feel the job is too big, they have a remedy. The people will be only too glad to greet them with open arms and give them the kick in the pants they badly need. They got one a few weeks ago and there is another waiting for them.
Reading through the speech of the Taoiseach, the Acting Minister for Finance, one wonders if he is, to use a modern expression, with it at all. Is he like Deputy Andrews and a few more of the dons who are far removed from the reality of having to earn a living, the reality of knowing what it is to have to work for a week's wages, and try to make it buy what is required to run a house? Right through his speech on the Budget last week, runs the theme that all the ills of the country have been caused because the workers got a few shillings extra. There is a suggestion that an adverse balance of payments as high as £15 million may arise. Since there was a credit balance of £15 million last year this would amount to £30 million in one year. The Taoiseach said the adverse balance might go as high as £30 million. Anyone who would suggest that this was caused by the £1 a week the workers got would need to have his head examined. Perhaps the Taoiseach and his Ministers have been earning good salaries and have not had to budget in their own homes for so long that they do not realise there are still people who must count every penny they spend, and wonder where the next penny will come from.
I wonder is the Taoiseach really in earnest when he says:
To go back a further link in the chain of cause and effect, it is clear that the increase in personal consumption stems from the substantial income increases in recent months which have far outpaced the average rise in productivity.
Is he talking about wages, or about the increased profits of the racketeers and Tacateers? Is he talking about the handy money they got over the past 12 months, which they can afford to spend abroad, or to buy luxury goods from abroad which the ordinary working man and his family cannot afford? I think he got himself a bit mixed up. He goes on to say:
Besides the eleventh round increases, which for wage-earners in general have amounted to between 30s and 40s a week, phased over a two-year or shorter period, there have been many cases of increases as a result of service pay awards and other factors, while hours have also been shortened.
For the Taoiseach's information — and I am surprised that the head of the Government is not aware of this — the general increase in wages was £1 per week, and the phased increase about which he was talking does not come into operation until April of next year. Therefore, it can have no effect good, bad or indifferent on the balance of payments for this financial year. Further, the service pay awards to which he referred have not yet been paid in most cases. When paid they will be used to buy bread, butter, boots and clothing for the workers' children, and will not be spent on television sets or Mercedes cars as he seems to suggest.
There is one other thing which I cannot understand. He said:
The phasing of most of the agreements means that there will inevitably be a further large rise in incomes in 1969 ...
A further large rise — another 15s or 17s 6d a week, another large increase in incomes. He went on to say:
...with the threat which this poses of a further fillip to consumer demand and a widening of the balance of payments deficit.
I do not know whether the Taoiseach really understands what he is talking about. Is he, or are the financial geniuses who wrote that for him or helped him to write it, aware how this country runs at all? The vast majority of our people depend on a week's wages or a month's salary. That is the sort of thing which would lead one to believe that the Taoiseach thinks everyone is, like him, in the surtax bracket earning £5,000, £6,000 or £7,000 a year, and that this extra money is pin money. It is anything but pin money. It will be used to buy the necessaries of life. Many people in the country are finding it extremely difficult to carry on with what they are getting.
Again the shortening of hours will not result in increased income because people are having their hours reduced from 45 to 42½ per week. Many of them work in the wet and cold, in the dirt and muck over the whole year and having their hours reduced from 45 to 42½ is not going to result in a higher standard of living or affect the balance of payments. This was a stupid statement to write into a brief of the Taoiseach which was read in this House. He goes further. I will read this because it is the corniest I have ever come across. He tries to set out, as did Deputy Andrews, that the Government are doing everything possible to help those for whom they hold some responsibility:
In relation to public expenditure this means that outlay on current services should either be reduced or be paid for out of existing, rather than newly-created, money. Reduction of such expenditure is not possible without a drastic and undesirable reversal of policy: the Government do not consider it necessary or justifiable to cut back on social welfare, education or agriculture or to refuse, as an employer, to extend to the public service a standard of pay increases comparable with those granted in outside employment.
This comes from the Taoiseach of the Government that so far have not given any increase whatsoever to thousands of lowly-paid workers in Government employment. This is from a Government who up to today have still not been able to make up their minds what the people employed in certain categories on drainage work, in forestry, in saw mills throughout the country, not to speak of the Army, ought to get. He says they must get as much as is given in outside employment.
Early this year as a result of negotiations a wage increase was given, service pay granted and there were extra holidays for workers in private and public employment. The only employer who to date has not completed that is the State. The only employer who has not begun its work with regard to the granting of two days extra holidays in the year is the State. Yet the Taoiseach says he must keep up to the standard of outside employment. Those are hard facts. Deputy Andrews was quoting Deputy Corry's ability to give facts in this House. Facts from Deputy Corry and from people on that side of the House and the real facts are two very different things and I challenge anybody on the Government benches to show that what I have said is incorrect.
The Government would love us all to believe that there are many Santa Clauses among them and that Ministers are carrying presents to the poor and to the hard-pressed. The only presents which the workers have been getting are income tax demands. They have got fairly big ones. Apparently, it still has not seeped through to the people who run finance in this country that a man who ten or 11 years ago got an allowance of £6 10s per week without having to pay income tax is still only having an allowance of £6 10s per week if he is single without paying tax. While at that time he could get more for his money he is now paying income tax on half his basic wage. This is the sort of thing that hits real wages.
The effects of the new taxes which were put on last week have been played down by the Government and by the speakers of Fianna Fáil here as being only little things that were necessary. I want to say categorically they are not little. They are big and they are not necessary. I am convinced when the Minister for Finance was introducing the Budget last spring and said that the Budget was intended to cover the whole year that he meant just that. The only reason this Budget has been introduced is because the Government know they must have a general election some time next year. They are hoping they will raise enough finance between now and the next Budget given a full half-year to be able to soft-pedal on the next Budget and then fool the electorate again.
I suggest that the amount in the Budget is very small. I do not drink or smoke and, therefore, the Government will not get much under that heading from me. Most of my constituents have much to say about the increases. The Government should hear what they have to say about the increase in the price of cigarettes, beer and spirits. I am wondering if this is not another little trick by the Government in increasing the price of cigarettes because you may remember in the last Budget and the one before that the speakers challenged the fact that tipped cigarettes which contain much less tobacco than the other cigarettes were being taxed. The extra tax applying to tipped cigarettes is the same as for the ordinary cigarettes. It was explained to us by the Minister for Finance that there was only a matter of a couple of hundred thousand pounds involved and it had been agreed this would be retained by the manufacturers. He said they would improve the type of cigarette. Not being a smoker myself I cannot say whether they have improved or not. The only effort made to spend that money appeared to be when you had one particular brand with a card game in the packet. The Minister for Health rightly knocked that one out and he very quickly stopped the game of cards. The chairman of the company planning this is at present on a TV advertisement in which he says they are going to beat the Budget by not imposing the 3d extra which they had proposed to add on because of the card game. He said this 3d was going to be used to subsidise the price of cigarettes but that 1d of it was going to be kept by the company because of increased costs. The Taoiseach mentioned that 1d is going to compensate for the differential. I do not know who is right. The two of them will come to a fairly reasonable arrangement to allow the tobacco manufacturers to hold on to the substantial amount of money involved in the two deals. This is one trick that will not be ruled out by the Minister for Health or anybody else.
Reference was made to the question of the wholesale tax of five per cent and the Taoiseach points out that not all items are going to be included in this tax. He does not go to the trouble of listing all the items to be included. If he did he would still be making the Budget speech. He does not say there will be the extra 2½ per cent on that five per cent. The result will be that instead of a five per cent tax there will be another little bit and then a further little bit and eventually we will find the increase in prices will be fairly substantial.
I spoke on the no confidence motion and I told the Taoiseach something which I want to repeat now. Many trade unions have made agreements with employers for a staged increase of 15s to 17s 6d next year to cover costs as they were. Many others have not made such agreements. The simple fact is that the results of the Budget will very definitely cause those who have not made agreements to look for more than 17s 6d. It will be extremely difficult for those who have made agreements to hold on to them because the workers will say they have had their eyes wiped and they cannot afford to accept an agreement made before this Budget was introduced.
There is no doubt at all about this. It apparently does not get through to the minds of either the people who are framing the Budget or to the Taoiseach himself because, if it did, they surely would try to take actions like this into account. They proceed blandly to lay on taxes and then blame everybody except themselves while they know that, if costs go up, wages must go up also.
Deputy Andrews referred to the members of the Government as the tribal chieftains. That is a very proper description because, if anybody looked at the antics of some of the present members of the Government, they would realise that this term fits them to the ground. We can see the tomahawks being thrown and some have already drawn blood. Perhaps, the "tribal chieftains" when they meet again might consider that it would be appropriate to endeavour to compensate those on social welfare benefit who are getting no increase to compensate them for the effects of this Budget.
It is all right for people like Deputy Andrews, who could not be expected to understand the situation in an old age pensioner's house when that old age pensioner finds that the goods he bought one week for a certain amount of money, leaving nothing over, cannot be bought for that money the next week. I do not know if this is what the Minister for Health had in mind when he recently announced his new arrangements for assisting voluntary organisations who are helping out in bad circumstances. I am glad to see that a certain amount of money is to be set aside for this purpose. The Minister for Health is a more humane man than the other members of the tribe. Perhaps he has decided that he will have to do a little himself because the others do not care what happens to the aged in this country.
Deputy Andrews referred, too, to the contributory old age pension. I do not mind what Government introduced the contributory old age pension, but perhaps Deputy Andrews does not understand the mechanics of it. As long as the Government were doing a good turn by introducing this pension, they also did themselves a good turn because, by taking these people off one assistance, for which there was nothing except what came out of the Exchequer, they have been moved on to a benefit which is paid for and will be paid for by the insured workers' stamps with a much smaller contribution from the Government.
Incidentally, it is a matter of interest that, on the introduction of the contributory old age pension, the Minister for Transport and Power decided when the pension scheme was introduced for manual workers in Bord na Móna that the amount of the contributory old age pension would be taken into account. Perhaps he recalls the date. He suggested that at the end of 40 years they would receive a certain pension and he agreed with me that at the end of 40 years it would be the year 2003. I do not know what amount the old age pensioners would be receiving by then.
Reference was made also to the fact that the allowances for dependent children of old age pensioners was increased. That was brought about by the persistence of members of the Labour Party, particularly of myself. I am glad to see that has been referred to here.
It is very difficult to follow some of the items which have been mentioned here. But since the explanation given in the Taoiseach's speech for the imposition of certain taxes was that they were to assist such things as health, education and agriculture, I think a brief reference to them is quite in order. Deputy Andrews referred to the breath of fresh air which was introduced by the new system — the free system — of education. The Fianna Fáil Government would need to go down the country and stand in some of the old, condemned schools to know something about the breath of fresh air. It is not the air coming in from the fields but the air coming through the windows and floors and through where the door should be. I am prepared to give full marks to the Government for attempting to do something about education, but I cannot understand how anybody can stand up in this House and claim that we have an excellent education system as long as we have schools with windows and doors broken and the unfortunate children condemned to spend their formative years in them. Those children are frozen with the cold during winter and, apparently, it is nobody's business.
Another matter about which something should be done quickly is the question of teachers in primary schools. We have now reached the stage where, not alone is it not unusual to find a number of primary schools in which one JAM is teaching, but to find that there are a number of schools with two JAMs and nobody else there. Surely that is not something of which any Government should brag in Parliament.
The health services have been mentioned by the Taoiseach here. He says that £2 million extra is needed for them. I do not know what the Taoiseach means by £2 million extra or what he proposes to do. There have been a number of White Papers dealing with health. Apparently, the trouble is that, so far, nobody has definitely decided what will be done to improve the health services. I know it is nice to be able to say "We are considering a new health service — a new system — and that prevents everybody from suggesting improvements. As long as we are thinking of improving it there is no necessity to do anything about it". What about the dispensary areas? In County Meath, for instance, an unfortunate lady doctor had been very much overworked for more than 12 months in trying to cover two areas because no other doctor could be found. I am sure there are several other areas with the same problem.
One often finds that people are afraid to go to a doctor because, under the present system, the charges for hospitalisation and for drugs and medicines are so high that people fear they will not be able to pay for these services. If we raise the matter with the Minister we will receive an answer to the effect that an improvement is being considered. That seems to be the solution to all our problems.
I would suggest that one of the documents that have been published as a result of certain investigations having been carried out, suggesting a change in the hospital system be looked at. I wonder if some of this £2 million is to be spent on hospitals. It is proposed, if you do not mind, to turn the local county hospitals into community centres. How will those be run? Who will attend the patients in the centre? Will the local dispensary doctor have to go in there and serve his patients? It is also suggested that we should be able to bring certain major surgery cases, and major cases of many different types, indeed, into a central hospital in various areas. Where are the buildings and the staff? Who will arrange all this sort of thing? An extra £2 million expenditure on the health services certainly will not do what is suggested. The decision would seem to be to add a few pounds here and there and expect just to stagger through but it is a lot of nonsense. The putting in of amounts such as this is just a sop in order to keep people from criticising the extra taxation.
Reference is made to the increase given to people supplying milk to the creameries. Indeed, I agree with the comment by the Taoiseach that there seems to be an over-production of milk. How this will be dealt with, I do not know. Some effort should be made to channel our milk surplus into something more remunerative than butter. It is commonsense that some effort should be made to find some substitute or some way of marketing the surplus milk rather than to churn it into butter and then try to give it away which, in effect, is what is being done at the present time.
The extraordinary thing about it all is that the Taoiseach says he will help the small farmer by giving an increase to the person who supplies up to 7,000 gallons which, roughly, represents £30 a year for the full 7,000 gallons. Many people who are not selling 7,000 gallons per year will get very much less than the £30. It appears to me as if the small farmers are expected to be satisfied, literally, with pennies. When the derating of agricultural land up to £20 valuation took place, our small farmers were expected to take off their hats and dance a jig but all it meant to most of them was pennies per week. Here, we have the very same pattern building up again. For our farmers, the attitude is: "Live horse and you will get grass." If they are able to survive until next year, there will be an incentive in relation to the rearing of beef——
If he sends milk to the creamery, he will not——
We have to come to that. The increase which is suggested is that, if he is not in dairying, he can get a few bob. I do not know how they will watch this one. I do not know whether it will be like the calved heifer subsidy where, to my own knowledge, an inspector called half a dozen times to try to prove that some poor devil was not entitled to the £15. I am sure that if the inspector's travelling expenses were added up they would come to more than the £15 which the inspector was trying to prove the poor devil was not entitled to. I am wondering if this will be another example of that type of thing.
The Taoiseach brushes off very lightly the increase in post office charges. He says: "Post office charges have not been increased since 1964." I do not know whether or not he is aware of it but post office charges here are higher than they are in the neighbouring island. They are a very big matter for any firm dealing either with a big volume of mail or with posting out goods or samples. The Taoiseach does not even try to suggest, as was offered in Britain, a first-class and a second-class mail service. It will all cost the same. The postage is going up to 6d. It is now reaching the stage where I think it will be an extremely difficult thing for people to continue to pay this rate. As a matter of fact, the 4d rate for a postcard and for printed matter and newspapers will make the service terribly uneconomical. Inland parcel rates are going up from 6d to 2s 6d, according to weight. I do not know if the Taoiseach is aware of the effect that this will have on the economic life of the country but he may be quite sure that there will be plenty of wailing, and rightly so.
The Taoiseach announced that telephone rentals for residence and business lines will be increased by £2 a year and the connection charges for exchange lines by £5. He also said that the charge for local calls from a subscriber's telephone will be increased by one penny and by 2d from coin-box telephones. Everybody is aware of the dissatisfaction that followed some new arrangements a few years ago to connect the telephone lines to new subscribers. We heard all the stories about how difficult it was to get supplies. We were told that priority would have to be given to those who needed a telephone urgently. We were then told that people would have to pay rental in advance if they were getting service. It finished up by asking them to pay for the lines from the post office to whereever the service was being given. It spelled out very simply that only the rich need apply. Possibly, that having been done, the Minister now feels he is quite in order in making the rich pay for the extra facility of having a telephone. Would the Taoiseach care to comment on whether or not it is proposed to instal coin boxes which will take the 6d piece or should the subscriber who is going to make a couple of telephone calls go around with a bagful of coppers because 6d is quite a lot to have to pay for a coin-box call and, if he has to make a couple of calls, it will be pretty substantial?
Santa Claus comes along again. The Taoiseach says:
This year's Christmas shopping, posting and telephoning will not be affected by the increases proposed in the wholesale tax and post office charges. Because the greater part of this financial year is already gone and these particular proposals come into effect only on 1st January, the extra revenue accruing to the Exchequer by 31st March from all the changes proposed is not expected to exceed £4.2 million.
Now, I think it is cold comfort to anybody in the habit of using the telephone or the Post Office service in a big way to find he has not to pay the increase until January — because that is when most of the bills come in, anyway. I am sure they will not sleep any easier for knowing this will not affect them until the New Year. I do not know whether or not the Taoiseach has fully considered the hire-purchase restrictions because he says:
For private cars, motorcycles, scooters, record players, radiograms, tape-recorders and juke boxes the minimum deposit has been fixed at 25 per cent of the cash price.
I do not know whether the Taoiseach has gone on the multi-millionaire line, which apparently has been at the back of most of this planning, and decided that there was no difference between a person who buys a motorcycle or a scooter and those who buy tape-recorders, juke boxes and radiograms. If he only knew it, the majority of motorcycles and scooters are owned by unfortunate people who use them to get to work; and I suggest he should have been very careful about this. Then he goes on to say:
There will be a minimum deposit of 15 per cent on radios and certain items of domestic electrical equipment
Again, he regards the radio as being a more essential commodity than a motorcycle or a scooter. He continues:
The maximum repayment period for all the specified articles has been fixed at 30 months. Conditions of this kind are already applied by many hire-purchase firms in their own interest...
That is so, but it would not do the Taoiseach one bit of harm, when he is dealing with this sort of thing, to look at the rate of interest charged by these firms and the system under which they hire goods out. We still have the system where the fellow with the smooth talk sells an item to the housewife and when the instalments become overdue he threatens to bring the husband to court to make him pay them. Of course, in order to make it easier for this gentleman we have the proposal of the Minister for Justice that in the near future all such cases from a very wide area will have to be heard in Dublin because, as he says himself, the head offices of the hire-purchase firms are in Dublin, and never mind the poor devil who did not intend to buy the item in the first place and has not the money to pay his bus fare to Dublin let alone for the television set or the refrigerator which he is asked to pay for.
The decision to increase the interest payable on deposit with the Trustee Savings Banks is a good one, but I still think it is not high enough; it is not competitive with the commercial banks. This is one thing which could possibly have been improved a little more and would have yielded results. I am glad also at the Minister's decision in regard to the prize bonds. He says:
Net receipts from prize bonds are tapering off, mainly through increased withdrawals. In order to encourage bond holders to retain their investment for longer periods there will be special draws for five prizes of £1,000 each in every month in which no draw is held at present. This will begin as soon as the necessary arrangements can be made.
The Taoiseach announced this last week but on the 30th October I had a question down:
To ask the Minister for Finance if he will consider introducing a weekly Prize Bond draw for a substantial prize.
The Minister for External Affairs replied:
The amount invested in Prize Bonds is not sufficient to justify the holding of a weekly draw.
When I asked by way of supplementary question if he would consider having draws more often than at present in order to encourage people to leave their bonds in rather than withdraw them after the draw had taken place, he assured me and the House that the amount of money being invested in bonds was not sufficient to warrant anything of that kind.
There is only one way to describe a statement like that: it was a lie, and I am amazed that a Minister of his supposed integrity should tell the House what turned out to be a deliberate misstatement. Unfortunately, nothing can be done about it. It did not hurt anybody; that is the only thing that can be said in its favour. However, it would have been just as easy to tell the truth, but maybe that comes harder to some of these people.
Reference has been made here by Deputy Andrews to the fact that he was not allowed to speak on a previous motion in this House. While you may say, Sir, that this has nothing to do with the debate, I think it is only fair that since the comment was made I should say that a Whip's agreement made in this House by the three Whips and accepted by the House is binding. If Deputy Andrews feels that he was not allowed to make a contribution on the confidence motion last week because he was a backbencher he is talking through his hat. His Party, I am sure, selected their speakers; Deputy Des Foley, Deputy Martin Corry and Deputy Booth, who are backbenchers, were allowed to make their contributions. I hate people coming moaning into the House about things for which they blame somebody else and which must be their own fault.
Finally, we in the Labour Party have always supported any type of fair taxation provided it was necessary and particularly if it was needed for the purpose of improving social welfare benefits. We are not prepared to support this. We do not think it is necessary. Social welfare is getting nothing out of it, and while it may please some of the new socialist dons who come into this House and sneer at socialism and the Labour Party, we in the Labour Party are proud of the stand we have taken in this and we intend to carry on in the very same way in future.
Minister for Transport and Power.
On a point of order. I thought this went in rotation.
It is usual, when a Minister offers after an Opposition Deputy has spoken, that the Minister be called on.
All right.
I do not intend to take up much time in making observations because I spoke on the Budget on a previous occasion. We have heard a wearisome repetition this evening of the usual kind of accusations that are made: Government taxation is excessive, that it does not need to be imposed, and that we are doing it for some sinister reason. Yet having regard to the long history of our economic development and particularly splendid economic development since 1958, since when our national income has risen at a record rate, these allegations have proved to be untrue.
It is rather like the endless prophecies that Fianna Fáil is breaking up. These prophecies never come true, and I have heard a few of them during the course of the debate. Once more we heard this talk of the tomahawks. There are the usual rumours of the Cabinet breaking up, of mortal disagreement between Ministers on matters of vital policy. The Opposition are going to be sorely disappointed in this respect. Once again Fianna Fáil will be the political Party with the longest record in the whole of our democratic history for unbroken unity and being unbroken as a Party, policy in essentials unchanged, however adapted and modernised. This is going to be very disappointing to all the people who like to sensationalise speeches that are published in the press all the people who think that there is not one Taoiseach but three Taoisigh, who are looking for some kind of internal explosion in Fianna Fáil. They will be grievously disappointed.
It is well to be frank about taxation in the Budget. I have said these things before and they will bear repetition. We are taking 30 per cent of the people's national income in taxes and rates, and if you look at the well-off democracies of the world, where social welfare services have been developed, where there is good education, where the greater part of unnecessary poverty has been eliminated, you will find a high rate of taxation. It is now utterly respectable to engage in fairly heavy taxation, a very big change from 20 years ago, and it will continue to go on. There are countries in Europe where more than one-third of the people's income is taken in rates and taxation.
The money is required for redistribution among the multifarious services of one kind or another. It is important for the public to realise that we are to a considerable extent an egalitarian community. There are not many people here with high incomes and, therefore, the taxation has to be spread carefully, the rich paying more, but a great part of the burden of taxation, both in rates and taxes, being paid by the middle income group in this country because if, for example, one were to double supertax overnight, the amount found from supertax provisions would be lost in the course of the next 18 months or two years. If you were to look at the total income of the richest 10,000 people in the country and if you were to take half of it away and distribute it among all the other people, it would create a little flutter for the time being and then, as the needs of the country emerged, it would not be found to be of much use. That is a fact. To a very great degree we are an egalitarian State. It is just as well to realise that a country with a great number of people, with vast inherited wealth from imperial designs and imperial profits, creates jealousies and makes the acceptance of a national policy of taxation much more difficult and very often results in extremes of one side or the other — in the direction of right or left —which I hope we can avoid here. They are the facts about our position.
Deputy T. O'Donnell seemed to suggest that the amount we are offering to our farmers for milk for the first 7,000 gallons is niggardly. It is just as well to remind Deputy O'Donnell that the amount of subsidy involved in selling milk produced at home, paid for by the taxpayer, represents 26 per cent of the value of the milk sold at home, and more than half the value of the milk products sold in Great Britain. So great is the glut of milk products into those countries, if you go outside Great Britain, that the Government are paying nine-tenths of what the farmers receive for the milk sent neither to Britain nor sold at home. The subsidisation is fairly heavy.
Though one realises that farming incomes are lower than non-agricultural incomes not only here but elsewhere, we are making every effort to bridge the gulf. It is equally true to say that in respect of milk production, farmers have made some fair progress. Between 1965 and 1967 the total amount received by farmers for creamery milk supplies increased by 34 per cent. They certainly deserve that increase. It indicates they have made some progress in relation to the incomes that come from milk production.
Further allegations were made this evening that the reason for our imposing supplementary taxes is in order that we can have a soft Budget next year and then proceed to a general election. We have made it clear already that we thought it wise to impose taxes at present as a measure to damp down the prospects of headlong inflation taking place. We have made that absolutely clear. We have challenged not only anybody in the House but any reputable economist to quote figures from the last quarter of 1967 or the first quarter of this year which could indicate to the Minister for Finance, who was preparing his Budget all that time, that there was bound to be such inflation in 1969 and that he would be justified in administering taxation, in administering the economy, in a manner to try to bring back the balance of payment to normal.
We are trying just to put a brake on the economy, not to stop it, not to cause great unemployment, and only during the past six months have we been sufficiently sure of what will happen in 1969 to take action. I do not believe any reputable economist could have found any facts at the time of the original Budget to suggest that the Minister for Finance should impose a large amount of extra taxation or that he was certain then the position in 1969 would require that. I hope and believe the steps we have taken have been taken at just about the right time and at the right level.
Then, of course, people in the Opposition have been suggesting the Minister for Finance could have predicted the wonderful weather here — that he could have been certain in advance, in March or April of this year, that he would have to pay £6 million to farmers under the heading of price supports for milk and in connection with wheat. I do not know whether the Opposition have lost their minds or whether they really imagine that the Minister for Finance could make a declaration of that kind. Meteorological history is not much known to people but I should like to point out that we have had only 11 good summers in this century, 11 burning summers with plenty of sun in June, July and August. Most summers have been moderate, with plenty of rain as part of our natural climate. To have the Minister for Finance gambling on a good summer is absurd. Part of the necessity for this Budget is because of the good summer, its effect on milk yields and the consequent supports that that requires.
I also wish to make it clear that we have had periods of no inflation in which all the rules were kept and in which everybody, including the workers, seemed to be satisfied. Then the rules were broken because people became anxious to increase earnings as rapidly as possible without restraint as to cost or the increase in the cost of living that would eventuate——
Is the Minister accusing the workers of breaking an agreement?
We have been saying this continuously.
If he is, he should say so and say so to the workers.
No, no. I was referring to everybody in the economy breaking the rules which Mr. Ted Heath, Mr. Harold Wilson and their Governments have been begging everybody to keep during the last 15 years —that incomes do not rise more than production. It is a very common cry and there is no slur cast on anybody. The two countries have been breaking the rules continuously, and we have been breaking the rules particularly badly in the last two years just as the British have. It is no good the Deputy trying to suggest that I am casting a slur on anybody.
You are casting a slur on somebody.
Part of the reason why the cost of living has gone up recently is because we have devalued, and because we and the British have had to destroy part of the value of our wealth because we have constantly broken these rules. We happen to be in company with the British in this. These are the facts and they are accepted by socialists and capitalists alike.
There was a period between 1958 and 1961 in which we had the beginning of a record growth in our national income and in which period the rules were almost completely kept. Earnings increases did not exceed the growth of production. Earnings went up 12 per cent during that period and it meant a real increase in spending power for the workers because they kept their money and the increase in the cost of living in that period was practically negligible. In 1961 everybody thought they could go ahead and get greater earnings at a more rapid rate so that in the next three years earnings went up 28 per cent. Because they went up to this, the amount that workers actually kept was the same as in the previous three years. In the meantime we began to have inflation so that the inflation which started about 1961 was only partially corrected and had to be, eventually, between 1965 and 1966.
There is nothing unusual about the Budget and hire purchase arrangements and the suggestion to the banks that they make credit available in a preferential way for productive purposes. It is going on in a great many countries such as Sweden and the Netherlands and there is nothing peculiar to this Government in their action. It is an automatic brake that has to be applied. This action has no connection with a particular political Party's policy and no connection with the fact that we do not call ourselves a Labour Government, although we represent the workers more than anybody and although we have done more for the workers. We represent all sections of the community. If there were an intelligent Government calling themselves socialist they would have to do the same thing. In the British Labour Government Mr. Harold Wilson is grinding the trade unions in Britain by restrictive practices and a wage freeze in order to get the British economy back again. We have not attempted that. We have price controls on a limited number of commodities of importance. These policies are part of an inevitable action that has to be taken. If we do not take it we lose reputation for creditworthiness. The cost of living would soar and the workers would not lose only part of their rise in wages and salaries but a great deal more besides as has happened in some South American countries.
The year 1967 was a fairly good year in which the economy began to grow again at the previous rate but with it emerged evidence of inflation and we have inflation now. In the two years 1968 and 1969 earnings will have increased 50 per cent more than the total value of the production of the country which we could envisage at that time. If that kind of thing happens action has to be taken, as in other countries, to restrain and reduce spending, because the moment people spend too much they import too much. May I mention that what Deputy James Tully suggests from reading the Taoiseach's speech would indicate that he seems to think that the Taoiseach is living in a Rolls Royce world and that it is only the rich who spend. A great bulk of the spending in this country is not by the rich but by the entire community. For instance, you cannot buy for yourself a bottle of milk without there being an import content in it, either by replacement of the machinery the farmer uses, or if made in Ireland they are made of imported metal, and there is the bottle itself. There is an import quantity in everything we purchase in this country.
Milk bottles would be a long time causing inflation.
The figure I gave still holds good. Every extra £1 of expenditure results in 8s 6d increase on imported goods. If these goods are not met by greatly increased exports then spending has to be reduced. It is as simple as that and it cannot be repeated too often.
Deputy James Tully spoke as though there had been some restriction on the increase in earnings, as though people were living here in appalling conditions. As far as I know total earnings have gone up by 40 per cent since 1964. The cost of living has gone up from 22 to 25 per cent in the same period. That shows a net growth in income. If incomes go up by more than a certain amount part of the value of what the workers receive is lost in inevitable increase in the cost of living no matter what is done to restrain prices.
My own belief is that if we did keep the rules as we did between 1951 and 1958 workers would reap the benefit in the long run. Their real spending power would increase every five years far more than under the present system in which everybody breaks the rules. The total family income of this country would be very much higher if the rules were kept. I am certain that the cost of living would not rise so much. They would be able to keep most of what they receive. There would be greater encouragement for more industries. There would be more new types of well-paid employment, more jobs better paid in the community as a result and more opportunities for well-paid people in the community and the average income of an Irish family over a period of five years in terms of real spending power would be greater than it will be so long as we and the British people continue to break the rules whereby the growth of income correctly exceeds the growth of production. This has been said by people who are left-wing, who belong to Labour parties abroad, who belong to left or centre parties. Parties of all descriptions know and advocate this policy. In some countries the rules are kept.
The longest period during which countries' incomes really increased, in large measure to the benefit of the workers, were countries where the rules were kept for very considerable periods and the workers found it to their immense benefit. This is not a dictatorship and so when people break rules all we can do is to correct the position as far as we can. I want to make it absolutely clear that a Government that is responsible has to keep on repeating this policy whenever necessary. Deputy Tully suggested that there might be some larger wage increases next year because of these particular taxes on non-necessities that we have imposed. If there are larger increases in wages next year because of this and as a result there is still more spending the Government will have to take some other action to stop the spending but they will have to stop the spending down to what is permissible if the country is going to be able to proceed properly and if we are going to have economic development of the right kind and if we are going to encourage people to start industries here. This is just a fact of life and there is nothing we can do about it.
Incidentally, I wanted to find out how much the cost of living would go up through the taxes on drink and cigarettes and I found out that the increase in the cost of living would be fractionally less than one per cent, so that the imposition of these taxes will not have a startling effect on the cost of living although, of course, it will obviously affect the lives of those people who consume more of those products than others.
Does that include the wholesale tax?
I have not got the figures for the wholesale tax.
Of course, it will be substantially more.
As the Deputy knows, taxes on spending are now very common. They have been adopted by three Labour Governments in Northern Europe who consider that the best way to encourage production is to engage in indirect spending and whenever there is indirect taxation and whenever indirect taxation goes up at the time of the main Budget very careful efforts have been made to ensure that social services have been increased so that tax on spending does not reduce the spending materially of a large family——
That has not happened here.
It did happen.
In this case it did not.
No, we have not reached the main Budget yet.
It looked like it. It is bigger than the one last spring.
We gave considerable increases in social services on the occasion of the main Budget in April.
I hope I have made the position clear. It is just as well to be frank about these matters and to make it clear that the rules have got to be kept and they will be kept and the Government are not afraid to incur unpopularity because of this. One of the reasons we have been able to make progress in the last ten years, one of the reasons that people have very much higher incomes than they had ten years ago, is because we have had the courage to balance Budgets and to impose unpopular measures to prevent excessive spending, because we are an import prone country and we are going to be an import prone country unless some fantastic amount of raw materials can be discovered. Those are the facts and we have to face the situation in that way.
My intervention in this debate will be rather brief. The Minister said that this Government are not afraid to make themselves unpopular by a decision. At the moment their popularity rating is very very low indeed. These measures which they are now introducing should have been introduced last April but with the referendum in view and as they were hoping for a victory they failed to put on the necessary taxation to run the country for a year. During my short time in this House and prior to that I thought the month of April every year was the month when the Minister for Finance stood up and told the House what the expenditures for that year would be, what amount of money he thought necessary to run the country. This year whether he meant it or not, he seems to have made a very big mistake on it.
I listened to quite a few Fianna Fáil speakers in this debate. Deputy John O'Leary of Kerry seemed to talk of anything and everything except the taxation which has been imposed. Deputy Andrews thought that everybody should express his personal point of view and break away from Party lines, so to speak. I can appreciate Deputy Andrews saying that in view of the statements of the Taoiseach and the Minister for Agriculture and Fisheries over the past few days. You had the Taoiseach saying that Captain O'Neill was a grand fellow and you had the Minister for Agriculture and Fisheries saying the direct opposite. Deputy Andrews also said that everybody should express his personal view on Partition but I noticed that he refrained from expressing a personal view on it. I should like to express my personal view on it. I have a feeling that the majority of the people in the North of Ireland at the moment would rather stay under the English flag than the Irish flag, and as long as they do that is good enough for me.
The question of Partition does not come into the Budget debate.
I realise that I am going outside the scope of the debate but this matter was referred to by others so I thought I could refer to it too.
It is the duty of the Minister for Finance during April to set out the expenditure for the year. This year he made quite a big mistake. The reason he made this mistake was that we were going to have a referendum and he figured that if they could get this referendum across and if the voters voted "Yes" to each of the Government proposals they would not rely on any one section of the community and they could after that impose any tax they saw fit to impose. They have now imposed 4d on a packet of 20 cigarettes with a corresponding increase on pipe tobacco and cigars. They have imposed 2d on a pint and 2d on a glass of spirits. Postal charges have been increased. It is now 6d to post a letter, which is dearer than it is in England where the cost of living is not quite as high and wages are much higher. Telephone rentals have been increased. With regard to hire purchase there is now a minimum deposit of 25 per cent and a maximum period of repayment of 30 months. There is a 10 per cent wholesale tax. This will mean another increase in the cost of living of everybody.
At the same time the Taoiseach saw fit to announce a national loan for £25 million. Reference has been made from time to time to the two interParty Governments we had here and how in 1957 they sought to float a national loan and it did not happen to be oversubscribed, let us say. The Government put the Opposition in a very difficult situation by floating this national loan at the same time as they introduced the Budget. The Leader of the Fine Gael Party and the Leader of the Labour Party said straight away: "We are supporting this national loan". I wonder was that the cry of Fianna Fáil in 1957?
One penny per gallon has been offered to the creamery milk producers on the first 7,000 gallons. This means approximately £29 extra on the first 7,000 gallons to every man concerned. This has been given by the Minister for Agriculture and Fisheries. I wonder if he were offered an extra £29 per annum on his salary what he would say. He would say what the farmers are saying. They have no choice but to accept it. Over the years we have had successive Ministers for Agriculture. We had Deputy Smith and, seemingly, when he introduced the heifer subsidy scheme, which by all accounts benefited himself more than anybody else——
The Deputy should make no such charge against any Deputy in the House.
That is a totally scandalous assertion. Is the Deputy withdrawing it?
It has been said and the Deputy has been asked to withdraw it.
I shall withdraw it. Later, we had another Minister for Agriculture, Deputy Haughey, and when the farmers sought to meet him when they came to Dublin he refused to see them and left them sitting on the steps of his Department for a long time. Eventually, the Taoiseach decided that the Minister was not going to solve the problem and there was a reshuffle of the Cabinet. Then we had the man from Donegal, Deputy Blaney. Since he became Minister for Agriculture and Fisheries he has done everything to divide farm organisations and drive a wedge between them. If he is remembered in years to come, he will be thought of as the Minister who cemented the farm organisations together.
We are getting into realms of agriculture and it does not arise.
The taxes that have been imposed have certainly affected the farming community, as I am sure the Ceann Comhairle will agree, and I think I have a right to speak about the farming community. The results of the referendum have shown that the policies which the Government have pursued are not acceptable to the people any longer. Various Government speakers have said the people were afraid. One Fianna Fáil Deputy, Deputy John O'Leary from Kerry, said the people knew that if PR was abolished Fine Gael might get into power at some later date. Why then would the Government put this proposal to the people? If they thought they would be beaten, they would certainly not have put it to the people. If the referendum had been successful for them they would say that this was a victory for the Government and its policies. Now they have been beaten, they change their tune and say that the reason was because the people were afraid they would get too much power if they succeeded. No doubt Fianna Fáil would have too much power if they had succeeded.
Another reason given by the Government for the introduction of this mini-Budget, or maxi-Budget as it also has been called, is that we had a very fine summer and agricultural production exceeded expectations. As a result, more money is needed to pay for the extra wheat and so on. Any Government that comes along with an excuse like that certainly does not know its job. Deputy Briscoe, on behalf of Fianna Fáil, this evening congratulated the Government on the high level of employment they had held over the years and particularly this year. Our present unemployment figure is about 55,000. I do not know if we ever had a higher figure but it is certainly as high as it has been in the last three or four years. It is the duty of a Government to ensure full employment in all sectors and the Government have certainly fallen down on this.
I represent a rural constituency, the largest in the country, and it has been totally neglected by the Government. No Government schemes to help the people have been introduced in recent times. For instance, emigration from East Galway is greater now than it has ever been and the only thing the Government have to offer to small farmers there is unemployment assistance or, in other words, the farmers' dole. Some scheme should be introduced whereby an incentive would be given to these people to produce more, and thus the country would gain more, rather than to hand out something which in fact makes people lazy. The youth today will not accept what their parents are now accepting and this results in further emigration.
Reference has been made to free education, but there is no such thing. Some sections of the community must pay for this and some sections are paying for it now; but those who are being educated will ultimately have to bear the major cost of what is called free education. I should not like anybody to think there was free education. Health services have also been mentioned and I want to refer particularly to the lack of dispensary doctors in East Galway.
This does not arise on the Budget. It would be relevant on the Health Estimate.
It certainly is relevant on the Health Estimate.
But we are not discussing the Health Estimate and I shall have to rule out any reference to the administration of health services.
The Chair may say that the health services do not properly come into this debate but references have already been made in the House this evening to this matter and the Deputies who mentioned it were allowed to speak on it. If the Ceann Comhairle sees fit to rule me out of order I shall accept that ruling and I shall not speak on it.
After the Taoiseach had introduced this mini-Budget, in the absence of the Minister for Finance, and after he had made a case justifying this extra taxation, there was not a murmur from the Fianna Fáil benches, unlike the occasion in April last when after the Budget had been introduced there were cheers from the Fianna Fáil benches. In their speeches Fianna Fáil Deputies have made no reference to the taxation imposed on the people.
There have been many references to what the Fine Gael policy is and what the Labour Party policy is but I have seen no direct statement about what this Government's policy is on health, education and so forth and on all the different aspects of life. In fact Fianna Fáil have a stop-go policy whereby they introduce this, that or the other scheme at any time they see fit and they think that the people should accept it at that. They have convinced themselves that no other Party or combination of Parties is fit to rule and that only they can rule this country. Deputy Andrews went back over the last eight years and spoke about what Fianna Fáil had given to this or that section of the community and over those years but he did not refer to the increased cost of living which has occurred in that period.
The time has come when a change of Government is necessary and the people have clearly indicated that they want a change of Government. They say to themselves "You have the Labour Party and they have approximately 19 seats at the moment. To achieve an overall majority their gains would have to be very great indeed. You have the Fine Gael Party who have 46 seats at the moment and they are not too far away from it. You have the Fianna Fáil Party in Government at the moment and their greatest worry is that you might have some type of an amalgamation between Labour and Fine Gael who may form a Coalition Government similar to what we had from 1948 to 1951 and from 1954 to 1957." The Fianna Fáil Party members keep referring to these times, the periods between 1948 and 1951 and 1954 and 1957, as if they were the times when we experienced our greatest troubles.
Hear, hear.
The Parliamentary Secretary may say "hear, hear", but I can tell him, as one who represents the rural constituency of East Galway, that it was during those two periods that anything worthwhile was ever done for the west of Ireland. I defy contradiction from any member of the Government or of the Fianna Fáil Party who represents the west of Ireland that it was during that time that any scheme that was beneficial to the people as a whole was introduced. During the referendum there was a lot of talk about small Parties and Fianna Fáil maintained that there is no room any longer for these small Parties. It was individuals from small Parties who introduced the schemes which have proved to be of the greatest benefit to people in the west of Ireland. As Minister for Health, Dr. Noel Browne was more than partly responsible for building Galway Regional Hospital and my late father started the Corrib Drainage Scheme. These things came to us through an inter-Party Government and since then no schemes have been introduced in the west of Ireland. If there was a general election in the not too distant future Fianna Fáil would be returned here with somewhat less than half the seats. The Fine Gael Party will increase its number of seats considerably. Whether we would increase them to the extent that we would have the necessary numbers to be able to form a government, I do not know; but I do know that after the next general election there will not be a Fianna Fáil Government. My only hope is that we will have some other Government to replace them and to put the country back on its feet.
Like other Fine Gael speakers, I should like to support the National Loan. We in Fine Gael are supporting this loan because we believe the economy is sound fundamentally and we recommend it to everybody. Deputies are often consulted about such matters and I can assure the Government that we will do our part in recommending it to the people. However, the great difficulty about recommending the loan is that it is against the background of mismanagement of our affairs by the Government. We would like to support anything that, even in a small way, would improve our social services, improve the employment position, or the health services, or improve in any way the standard of living of the people. I would like to say, as a Deputy who has regularly toured his constituency, that this Budget has shocked the people. Every year now you find that you have what has been described as a mini-Budget which is as severe as the annual Budget itself. The Budget introduced by the Minister for Finance last April was a clear indication of how far removed from the people's problems, and even from the grassroots of their own Party, the Fianna Fáil Government are and this is further emphasised by the fact at this stage they introduced a mini-Budget of the magnitude of the one we are now discussing. Although they have been in office for years they still continue to ignore the problems of the people.
I am sorry that the Minister for Transport and Power is not here because I wanted to address a few specific remarks to him. However, his Parliamentary Secretary is here. One of the problems in my constituency of mid-Cork is a problem which is not common to those living in the midlands or along the eastern seaboard. I refer to the manner in which the people are leaving the land in ever-increasing numbers. The west of Ireland is being denuded of its population because the people living there have none of the amenities to which they are entitled. The one really essential amenity and the one which should have priority is rural electrification. If necessary, the electricity supply for these people in these remote areas should be subsidised by the Government. Many people in parts of Cork and in the west of Ireland are still waiting for electricity. The special charge imposes such a burden that it frightens people off being connected up. During election campaigns Fianna Fáil pay lipservice to these priorities. When the election is over priorities are forgotten. Amenities will have to be provided to ensure these people a better standard of living.
There is then the problems of roads, water supply, sewerage and so on. This has been ignored by Fianna Fáil all down through the years. This Budget is a Budget imposing increased taxation on all the old reliables. Already this year cigarettes have increased by 6d on the packet of 20. Remember, in addition to the recent 4d, cigarettes were increased by 2d last April. There are those of us who, like Deputy Tully, do not smoke or drink. Mark you, the only comforts some people have are the pint, the cigarette or the piece of tobacco. It is a tragedy that these items should bear more taxation for the second time this year since the existing taxation was already beyond the capacity of a great many people.
There were few concessions to any section of the community. The day before the Budget the Minister for Agriculture and Fisheries announced concessions where the dairy farmers are concerned. Deputy Donnellan referred to the in-calf heifer subsidy scheme. I do not make any allegations against any member of the Government but I assert emphatically that this was a scheme for the benefit of the rancher and the big farmer. It did not solve any problem as far as the agricultural community as a whole is concerned. Whilst the penny increase on the gallon of milk may be of some assistance, it is true to say that certain farming organisations were appealing to the Minister for years to introduce the two-tier price system for milk. At this late stage the Minister suddenly decides to agree. In my opinion it will not solve any problem now.
Those of us who represent rural constituencies are well aware of the problems. Were it not for the increased price for cattle this year the year would have been a very bad one indeed. We were fortunate in having a reasonably good price for cattle throughout the year. That saved the Minister for Agriculture and Fisheries and the farming community from near crisis. It is regrettable that the Minister should continue to ignore farming organisations, despite their making overtures to the Minister. It is regrettable that he should continue the Cold War. The Taoiseach has shown himself to have courage and certainly he showed courage in imposing these recent taxes. I think the people would be appreciative if he showed courage in speaking to his Ministers, particularly the Minister for Agriculture and Fisheries. No matter what anyone may say about industrial development, this is fundamentally an agricultural country. It is regrettable that the Minister for Agriculture and Fisheries will not go half way towards meeting the farming community.
It is rather curious that the Minister for Finance should have been £20 million out in his Budget last April. He made an error of close on £20 million. Is it any wonder the people have lost confidence in the Government? That loss of confidence was clearly demonstarted in the referendum. It is an inescapable fact that any Government which could make such an error is not capable of governing. I am convinced that people are eagerly awaiting a general election in order to deliver the message to the present Government. The Taoiseach has on television, and elsewhere, challenged the Opposition to state what kind of Government could replace the Fianna Fáil Government. It is immaterial to the Taoiseach what replaces this Fianna Fáil Government because, if there is a general election, the possibility is that the Taoiseach may find it very difficult to keep his own seat. That opinion is pretty widespread in his own constituency. So low is the Government's stock that their supporters went out and worked against them in the referendum. There is only one course open to the Taoi-seach—declare a general election. I remember when Fianna Fáil were defeated in a by-election in mid-Cork the former Taoiseach immediately declared a general election. It was that defeat that brought about the general election in 1965. A quarter of a million people rejected the referendum proposals and there is no course open to the Government now except to declare a general election.
We are perturbed on this side of the House because of the go-slow policy of the Government. there is nothing in this Budget to indicate an improvement in health services, an improvement in social welfare benefits, an improvement in the housing situation. For years people have been waiting for local authorities to build houses for them. For example, there is a case in my constituency of a man with a wife and seven children who has been waiting for a house for six years. They are living in the most appalling hovel anyone could imagine. The health of the seven children is in danger. In order to try to improve his chances of getting a house, even though he is only a working man, a labourer, that man bought his own plot to try to induce the local authority to expedite the building of a house for himself, his wife and children. It is a great tragedy that, even though circumstances forced the introduction of this extra taxation, there is nothing in this Budget to relieve the problems of or give assistance to these people, or to provide services for people who should have got them a long time ago.
Listening to the Minister for Transport and Power this evening one would have thought that because they had, in his own words, the courage to impose this extra taxation, because they had the courage to take unpopular steps, that was all that was necessary; but the people who elected this Government democratically expect more than that. There is a danger in the fact that the younger sections of the community are inclined to defy authority, and inclined to disregard the laws of the land. An amount of vandalism is taking place because people are frustrated and disappointed. Because of the political patronage and because of the Government's attitude, young people have no respect for law and order. The normal and natural reaction is to defy authority. I know the rules of order will not permit me to deal with it now but I will have an opportunity at a later stage to bring to the notice of the Minister for Justice certain irregularities which have taken place recently in my constituency.
As a public representative meeting people and attending on deputations I am disappointed and worried about the attitude of some people. They are not satisfied and there is a lot of uneasiness and unrest. It is a terrible shame that a road worker or a forestry worker who still has a pay packet of under £10 a week has to pay income tax on anything over £6 10s in 1968. It is very difficult to get people to accept this indefinitely. Repeated demands have been made to the Minister for Finance by way of Parliamentary Question and on different Estimates to give some relief to those people but he continually ignores them.
Because the Minister for Agriculture and Fisheries was not talking to the farmers he was not in a position to assess the agricultural requirements for this year. He was not aware of the fact that there was an increase in the acreage of wheat because he had no discussions with the farming community. In this age, when the Government are preaching the vital necessity for cooperation amongst the agricultural community, surely it is incumbent on the Minister, as the political head of the Department, to set an example by having frequent and free and frank discussions with farming organisations in order to bring about a better system of management between the Department and the agricultural community. The Taoiseach spoke on television and during the referendum campaign about the courage of the Fianna Fáil Party in facing up to unpopular measures, but he should have the courage now, if necessary, to tell the Minister for Agriculture and Fisheries as one of his Cabinet Ministers——
I do not want to interrupt the Deputy but he is getting away from the Budget. He will have an opportunity to raise this matter on a later occasion.
With all due respect, I will not continue on those lines if the Chair says I am out of order, but surely some of these taxation impositions will be used to provide finance for agriculture?
I agree that that question was raised in the Budget Statement but not the conduct of the Minister or his relationship with farming organisations.
The Deputy is talking about the Minister's reputation.
Motion No. 4 is before the House.
The Budget debate was always regarded as a general debate.
That has always been the case.
There is reference in the Budget Statement to two specific items dealing with agriculture, wheat and milk, but not to the Minister's conduct or his relationship with farming organisations.
This is vital to the agricultural industry, not to talk of internal or external relationships.
Unless the Minister makes some move we will have a repetition of what we saw a few years ago. We in this Party believe that the Government are so devoid of policies of any kind, of long-term planning of any kind, and of programming, that it became necessary to introduce this supplementary Budget. When the Taoiseach passes remarks to the Opposition, whether Labour or Fine Gael, I want to make it clear to him that when the next election takes place—and we are anxious that it should take place as soon as possible—we will play our part in providing a Government. It is disgraceful for the Taoiseach to say that, unless he is elected Taoiseach, he and his Party will not have any further responsibility for forming a government. The Taoiseach has one course only open to him, that is, to go to the country and give the people an opportunity of passing judgment on him. They did so on 16th October, and I am sure they would more than repeat that message if they got the opportunity again.
I should have thought from the tremendous applause that followed the Taoiseach's speech last week defending the Government that we would have had Fianna Fáil Deputy after Fianna Fáil Deputy rising to state the policy of the Government and defend themselves in the difficult position in which they now find themselves. However, they are mute, if not from malice for want of something to say or something to defend a Government which I suppose we can only regard as being a caretaker Government at the moment. It is quite obvious to all of us if an election were to take place—and which will, of course, take place as soon as the constituencies are sufficiently adjusted to suit those most directly concerned— the Fianna Fáil Government will then cease to exist. Be that as it may, as the Fianna Fáil Government are mute from malice or other reasons perhaps it is necessary for me to express my opinions so far as they are concerned with advising the Government as to what they should do for the short period of office which they will still enjoy.
We have been faced with what one could almost call a criminal Budget. I am not an expert at quoting from the record or anything like that but if the Parliamentary Secretary and the other Deputy who sits behind him refer to the official records they will find that, when the Budget was introduced last year, I was one of the Deputies who said it would not be long before we would have a supplementary Budget to try to cover up the defects of the then existing Budget. The reason for the Budget last Spring was that the Government had then decided, in effect, to try to perpetuate itself in power. They imposed a Budget which was not balanced properly and was not sufficient for the commitments which lay ahead. They expected as a result of the referendum, on which they were defeated, that they would be changing the electoral system. They find themselves now having to come back and having to impose taxation on the country as a whole.
I was talking the other day to a working-class man who told me that his recreation, apart from working hard, was that he went out to the "local" every evening and had his glass of stout, or perhaps two glasses, and smoked cigarettes. He said he was not a politician or expressing political views but every Budget that came up, whether the annual Budget or a supplementary Budget, taxed the very things that affected him. He wondered, not knowing much about finance or economics, how long the Government could continue to go on taxing these particular commodities.
He must have voted Fianna Fáil at the last election.
I was possibly talking to a convert. Whether he is a convert to Fine Gael or to the Labour Party I do not know.
Be that as it may, there is some consensus of opinion that if you tax the non-necessaries of life it is all right. That may be, but what I want to stress to the Government is this: you have to have a definite financial policy of some sort. You cannot have a policy whereby you impose taxes when the occasion arises to take more money from the people but, no matter what, you balance the Budget. The economists who write articles say this is perfectly all right. You succeed in balancing the Budget but, at the same time, you are imposing more and more blistering taxation on the backs of the people as a whole. That cannot continue indefinitely. I ask the Parliamentary Secretary, when he sits in on the next Government meeting at which they are discussing finance and policy generally, to ask is there any limit to taxation. Is the policy to go on taxing indefinitely without foresight for the future? Anybody must look at it, even though he is not a political economist or an expert on budgeting, and ask himself: Have the Government any policy other than coming back twice a year to impose blistering taxation on the country?
They call it curtailment of spending. It is not taxation at all. The boys have too much and are spending too much.
I will have to appeal to the Chair to defend me against continuous interruptions. I have merely stepped into the breach here.
We are trying to help you.
I have been here for the last two hours.
They are out looking at their constituencies.
The Parliamentary Secretary spoke for half an hour in which he said nothing.
(Interruptions.)
In his own words he spoke "clotted nonsense".
He spoke like an Opposition critic. He was criticising those who brought the Budget here.
To return to the Budget proposals, it is obvious that they have been drafted in the Department of Finance by advisers of the Minister. We have the old "hardy annual" turning up again. Some years ago the Fianna Fáil Government were foolish enough to introduce a turnover tax here. I happen to know the advice issued to the then Minister for Finance, who is now in happy retirement or semi-retirement in the Seanad, a former colleague of mine in Wexford, Senator Dr. Ryan, and the advice issued to him was to introduce the turnover tax because thereby he had a means of taxing everybody. It was said to be an even tax that nobody would notice. By doing that it was quite simple to come back each year and raise this tax. It started at 2½ per cent and subsequently after 12 months the Minister could come back and make it 5 per cent. The official advisers do not have to face the public as we Deputies have. Deputy Corish and myself have to face the electorate in Wexford and we know the opinions of the Wexford people. The official advisers do not know that the turnover tax when introduced created the greatest uproar in Irish business circles and that it started a disastrous sequence of events. I am speaking to the Parliamentary Secretary and I hope he is listening.
This turnover tax imposed on small business people—honest people who had worked hard all their lives and had given good service to the public not only in Dublin but in rural Ireland—the obligation of collecting this tax for the Government. They were quite unable to do it because they had not the facilities. The first result was that these small business people who were the backbone—possibly the conservative backbone—of the country, were driven out of business. Practically all small business people in many parts of Ireland, whose forebears had served before them, were driven out of business by this turnover tax. That was one of the results of the advice of the official advisers to the Minister for Finance. They said it was a good tax, which was fair and equitable, but it created the greatest public up-roar there has been in Ireland for a long time. The Fianna Fáil Government have not come back with increases in that tax. But, lo and behold, they introduced budgetary proposals that were untrue, unrealistic and incapable of balancing the Budget or of meeting the commitments of the country. Now they have got to come back and they start on the beer, the working man's beer. I must hand it to the Labour Party there. One Fianna Fáil person to whom I have been speaking says he will vote Fine Gael next time or, possibly Labour.
They are all the same.
The official advisers came back and I have heard that they said to the Taoiseach, who is acting as Minister for Finance: "Now we must come back and do what we have advised you to do all along. We cannot return to the turnover tax." I am only surmising but the Taoiseach probably said: "Do not give the turnover tax, whatever you do. All the small business people have been put out of business and quite a few of them have had to emigrate. Come back with something else in disguise. What about a wholesale tax?" The Taoiseach comes in here and introduces a wholesale tax in this Budget which, he says, will not affect food or any of the essentials of life.
Does the Parliamentary Secretary and the Government he represents know that the wholesale tax will put up the cost of living? The wholesale tax is just a deceitful imposition of a further rise of turnover tax. The small business people have already been driven out of business. The Government are trying to get out of their difficulties. They know they are going very soon. This is not decent, proper or honest finance. They have been given the duty to represent the Irish people and those of us who have been elected, no matter what side of the House we are on, are elected to serve the Irish people properly. What is happening here is that there are incompetent people running the country's affairs. I am not making a charge of dishonesty against these people but I am charging them with being incompetent and inefficient. The work which they have been elected to do is being done by official advisers.
The Government have made as big a mistake in the introduction of this wholesale tax as they made when they first introduced the turnover tax. They are out of touch with the people. They are rooted in the belief that no matter what they do the people will vote for them. The Budgetary proposals which were introduced here were prepared before the results of the referendum were known.
I am sorry that the Minister for Finance is not here tonight. We all regret the accident with which he met and that he may be out of public life for some time. He, at least, had the ability to see the morass into which the Government were leading themselves. Far from budgeting economically for the many necessary requirements which will have to be met, such as the increase in the salaries of civil servants and so on, and far from stabilising the economy, the Government will only encourage claims for wages which are absolutely bound to follow.
What is the sense in the Minister for Transport and Power lecturing us here for half an hour and saying that the wage demands have outrun the expansion of the economy? Who is responsible for that? The Government are responsible for it—the Fianna Fáil Government who have been in power for the past ten years are responsible for it by every single act they have done. They are not being affected by any extraneous circumstances such as affected the inter-Party Government from 1954 to 1957 which Deputies opposite are still speaking about. That Government had to face a Korean war and all sorts of external difficulties, including financial difficulties among the great powers.
Fianna Fáil only have to face a Cabinet war.
All they have had to face are internal problems which they themselves have created. It has always been my principle to try to be constructive and not to be destructive of Fianna Fáil. However, there is no need for me to be destructive of them now as they have already brought about their own destruction and, as I have said, they are on the road out. They will not be here much longer. Of course, they are realists in so far as political issues are concerned. They will stay in Government for as long as possible.
The new Constituency Bill which, I understand, the printers are busy on tonight, will be, perhaps, one of the most up-to-date attempts at gerrymandering that has been seen in any Parliament in any part of the world. I should like to feel that Fianna Fáil, for as long as they are here, will make the best of that time. I have not noticed many speeches emanating from the Government side of the House, from the front benches, or, indeed, from the backbenchers who, when the Government find themselves in difficulty, try to slip the issues across so that they might give some indication of a change of policy or of the development of a new policy. I can say truly that we have not heard anything from them so far except an attempt on the part of the Minister for Agriculture and Fisheries to extract himself from the difficulties in which he finds himself with the farmers, due largely to his own lack of imagination and co-opera-tion. The principal complaint of most of the Government members is that they find themselves, due to the very warm summer—I must say I did not notice it very much myself—with a milk surplus. They find themselves in great difficulty as to how to dispose of the milk. The backbenchers are like the infantry backing up the artillery— the artillery being the front benchers. The infantry have been assisting the artillery to explain—or rather explain away—the situation, what they are going to do and the difficulties they are in, and so on. The Minister for Agriculture has suggested a beef subsidy. It is better late than never. Was it not obvious to the meanest intellect, was it not obvious to anybody in the position in which the Minister for Agriculture and Fisheries must have been to study the economic situation and world economic trends, that practically everything in agricultural production was running into surplus with the exception of beef?
When, some 12 or 15 months ago or so, the price of cattle was enough to make the average farmer cry when he went into the markets and when it became necessary to do something to save that industry, the Government did absolutely nothing. Then the foot and mouth epidemic came in Britain and the situation improved. The original Fianna Fáil policy was to have nothing to do with the British market. Of recent years, there is no other market open to them. It was obvious that the Government should have done something to stabilise the beef market. They should have done it 18 months ago. If they had had the foresight to do so then, they would have stabilised the beef market. Had they done anything at that time to support, sustain and encourage the production of beef we should not today face Budgetary difficulties.
The reason we face a balance of payments difficulty is because our cattle stocks were allowed to run down although they are the basis of our economy. They can keep our balance of payments right. The Government did not realise that when they let our cattle stocks run down. Now, belatedly, the Minister for Agriculture and Fisheries forestalls the Taoiseach and announces on television that he is giving one penny extra for the milk. I do not claim to know more than the Parliamentary Secretary to the Minister for Posts and Telegraphs, Deputy Lalor, who is present and who, I am sure, is a very brilliant man in every way because he occupies such a high position but even I could realise the situation as it was developing and I should expect the Minister for Agriculture and Fisheries, with all the specialised information he has available to him, to be very much aware of the situation as it was developing in world markets. If the Minister had taken action when he should have taken it in this regard we should not have an economic crisis in this country today because we should have high cattle stocks—but better late than never.
If the Minister had stabilised the cattle trade he would not have had the milk problem. He would not have had to face the enormous subsidy necessary to keep the dairying industry going because it would automatically have kept alive and, by keeping alive, it would have produced the necessary livestock which, in a great many instances, would have fed on the cows.
The Government should have advisers looking not only at the British market but at other markets also. It is funny to have to say that to the Fianna Fáil Government who, at one time, would burn everything British except their coal. Whatever the discussions the Taoiseach had recently with the British Prime Minister I know that what he said, in effect, was: "Our policy is your policy." Fianna Fáil have only one mentality—the British market and nothing else. It is a known fact that, if you want to trade, you must trade in more than one market. What markets are being sought or what markets are available to us other than the British market?
I am speaking at the moment on the agricultural economy as far as it affects our overall budgetary proposals because, as sure as I am standing here, when the adverse impact on the British agricultural economy passes and things return to normal there, we shall face a further crisis in the agricultural arena, a crisis that will not be solved by increasing the price of milk. It may be necessary to increase the price of milk to appease those who have invested largely in milk—because they were dragged into it largely on the ill-advised policy of the Government—but that will not be sufficient. The life-blood of the Irish economy is the export of beef and other agricultural produce.
I have a question down for answer tomorrow in relation to recent happenings, industrially and agriculturally, in the economy of Europe. I notice that we have only a few minutes to go before Dáil Éireann rises——
Would the Deputy like an interruption?
No. I am going strong.
I shall look after the Deputy.
If ever I want help in that line, I shall call on the Labour Party.
Extremes meet.
I am capable of standing alone.
We know where the Deputy stands.
It is a question of the possibility of industrial and agricultural expansion in our economy. I shall not refer to it tonight because I want to give the Government an opportunity of telling this House, through me—I am only a simple unit of this House—what their policy is for the expansion of industry and agriculture.
I cannot conceive that any Government which received such a massive vote of no confidence should, if it is not going to go to the country— Deputy Allen is looking quite nervous up there although I am told he has a safe seat in Wexford——
Deputy Molloy is afraid to come down from the gangway.
I appreciate Deputy Esmonde's statement very much.
Good lad. I knew you would speak.
With the political situation so uncertain, I cannot understand why they would not intimate to the Irish Parliament and to the country as a whole their plans for the future. They would not be giving away any secrets because, if they went to the country, it is crystal clear—even Deputy Allen can see the writing on the wall—that they would face a massive defeat.
Progress reported; Committee to sit again.
The Dáil adjourned at 10.30 p.m. until 3 p.m. on Wednesday, 13th November, 1968.