I should like, within the time at my disposal, to look at this Budget not alone in the light of the new impositions, the new taxes, but in the light of what I regard to be of greater importance. Although these taxes have been severe I should like to examine this Budget in the light of our greatest needs: economic growth and the provision of jobs. May I say our greatest failures have been to attain the necessary economic growth and provide sufficient jobs. I do not want any Member of the House to take my word for this. I am sure every Member got the same document as I did, through, I suppose, the Department of the Taoiseach, entitled "Comments on Second Programme. Review of Progress 1964/67" by the National Industrial Economic Council. This is an admirable council which has treated its job seriously and has on numerous occasions given valuable advice to the Government in regard to the First and Second Programmes for Economic Expansion but, unfortunately, did not have it implemented by the Government.
On the very first page of this document we find that as far as growth is concerned the Government have failed miserably in every single sector with the exception of imports and exports. It seems tragic as well that we should in discussing this Budget be concerned with our balance of payments when our exports, particularly our industrial exports, improved so much in the years 1964 to 1967, whilst on the other hand our imports increased as well. The NIEC report that as far as gross national product is concerned we failed to achieve our annual average target. It was similar in agriculture, forestry and fishing, in industry and in consumption, private and public, and in employment.
As a matter of fact, as far as employment is concerned, we find that since 1961 not alone have we not been improving the position in regard to the provision of jobs but we have been losing an average of 1,600 jobs per year. One is, therefore, inclined to ask what price programmes whether the first, second or third, as long as we have the Government adopting a policy which is demonstrated to the fullest in the proposals in this Budget and when none of these targets was achieved? I am convinced that the Budget was framed merely to satisfy the economic theorists rather than have regard to our great need—the provision of jobs and the creation of economic growth.
This Budget, mini or maxi, whatever you want to call it, spotlights the Government's concern to maintain or, indeed, increase our external reserves at the expense of losing employment opportunities. I think it was the Institute for Economic and Social Research which said recently that there should not be anything done now and particularly nothing like what has been done in this Budget because Irish industry was finding itself at a stage at which it could make some move forward in regard to the provision of more jobs. In the last three or four years the position in regard to the provision of industrial employment has not been improved to any great extent. Now we are told by those who should know that if we did not have deliberate deflation at the present time there would be a great possibility of increasing the number of industrial jobs.
I do not know whether or not it will be said in this House or outside it— I do not think anyone on the Government Benches would have the neck to say it—that the justification for this Budget lies in the recent financial crisis we had in Europe and in the world. It has got nothing at all to do with it. The proposals now before the House were decided upon four or five weeks ago or maybe they were decided on even a short time before that or possibly they were decided on before the referendum, but the announcement of the proposals was delayed. The Taoiseach says, and I believe him on this occasion—although that is not to say that I disbelieve him on other occassions—that these proposals were introduced to protect our balance of payments and our external reserves. This is where I join issue with the Government, with the policy of the Fianna Fáil Party with regard to our balance of payments and with regard to our allied external reserves. As I said, this has nothing to do with Europe or with the world. It is a Fianna Fáil Government economic exercise and the Budget would have been introduced in any case no matter what happened in the last week, as, indeed, a similar Budget was introduced in 1964 by the then Minister for Finance, now the Taoiseach, when practically the very same proposals were brought in and, unfortunately, the same damage was caused. One would have imagined that the Fianna Fáil Government should have learned the lesson from the repercussions which followed the introduction of a further Budget in the autumn of 1964.
The European problem is caused by difficulties in the French economy and by the crazy and inflexible world exchange system. This Budget has been necessary because of the mismanagement and ineptitude of the Government. There is no point in the Minister for Finance saying: "We have to do these things because we have an unfavourable balance of payments" because there will be a much more unfavourable balance of payments next year. If the balance of payments is unfavourable this year the Government must take responsibility and if the balance of payments is unfavourable next year it will be the full responsibility of the Government. The proposals in this Budget have been introduced because of the supreme importance which Fianna Fáil appear to attach to our external reserves even at the expense, as they have done and as they are doing, of relegating economic growth and the provision of employment to second place.
The basic job of this or any Government is the creation of jobs. The stated purpose of the First and Second Economic Programmes was the provision of more jobs. We had a target of about 8,700 jobs per year but, of course, that target has gone by the board. The stated intention of those who framed the First and Second Programmes, and I assume they will have the same intention in the Third Programme, was to provide for economic expansion and the provision of more jobs. Our criticism has always been that these programmes were merely pious hopes that these things would be achieved without the necessary action, or the minimum action, being taken in order to achieve them. While that has been the attitude of the Government and of the framers of the Programmes, there is a contradiction in that the Budgets which the various Fianna Fáil Ministers have introduced have been deliberately designed, or if not deliberately designed then unconsciously designed, to ensure that growth would remain static or drop back and that there would be similar regression as far as employment was concerned. It seems to me, therefore, that our workers, men and women, must come second to the sacred cow of our external reserves. Programming for employment is dead.
I listened to the Taoiseach's speech and read it subsequently and I did not see in it any great emphasis on the provision of employment. It did not appear from that document that there would be more employment or that employment would be sustained. On the contrary, underlying all this was the suggestion that there would be hardship as far as the provision of employment was concerned. The targets have been scrapped altogether. Employment opportunities are being sacrificed. Conservative policy makers detect unfavourable trends which violate any or all of the commandments of the financial world. I do not know who the advisers are. I do not know who advises that, in present circumstances, we should inflate in order to defend or to protect our economy. All I know is that the result will be catastrophic for the Irish people generally and for the Irish worker in particular.
As I said earlier, Budgets introduced here have been used consistently not as instruments of economic growth or for the provision of jobs but to defend and maintain banking and other financial interests, interests more concerned in economic theories and the mythical value of high finance rather than in the provision of good jobs at good wages. The sooner senior politicians, those in Fianna Fáil in particular, rebel against this persistent advice given by so-called economic advisers the better.
I have seen the trend in various Budgets under various governments. The advice of theoretical economists is taken, economists who know very little about men and women, very little about prices and the effect of prices on people; the Government should reject this advice and act as humans, not as economists; they should act like people who know the needs of people and who, because they know the needs, introduce measures designed in their own sagacity to protect employment and to expand employment.
The policy being pursued is a cautious and conservative approach to our problems. The proposals in this Budget will have the effect of stopping the growth of industrial jobs. The savage and unnecessary increased taxation will deflate the economy, with dire consequences. We should have learned from the lesson we had two years ago when, as a result of the mini-Budget at that time, there was practically no growth in national income for two or three years. That was the result of the panic measures taken by the Government then. In the early autumn of this year the Government were warned by the Economic and Social Research Institute—I do not know whether the Minister for Finance and the Taoiseach read the report of that body—that they could do either of two things in their general financial approach to the problems the country was facing. They could decide to encourage growth and production and employment by allowing expansion to continue, by not interfering with it or with the purchasing power of the people, or they could deflate the economy to cut down the balance of payments deficit. The latter is what they have done in the Budget proposals before us. They have done that at the expense of existing jobs, the creation of more jobs or the risk of losing some of the jobs that are there at the moment. The Institute warned that the two things could not be done simultaneously. One cannot deflate and expect the economy to expand. One cannot deflate and expect to maintain the status quo or to create more jobs.
We must give credit to the Fianna Fáil Government for their consistency because, once more, they have chosen the second course. They have decided to deflate in order to reduce the balance of payments deficit. They have done so at the expense of economic growth and at the expense of existing jobs. The two greatest needs we have are growth and the creation of jobs. The dramatic impact on the public, as far as this Budget is concerned, is the increase in the price of cigarettes, tobacco, beer, spirits, etc. These are what hit the headlines because newspapers know what is news—cigarettes up by 3d, the pint by 2d, spirits up by 4d a glass and the wholesale tax up by five per cent. That was the first impact of the Budget. Unfortunately, there is another impact. Some will try to compensate themselves for these increased prices and some will be successful in doing so.
Have the Taoiseach and the Minister for Finance considered the repercussions of these increases? Apart from these increases, other increases in prices have been approved by the Minister for Industry and Commerce—tea, bread, bus fares and various other items. What a reduction these will represent in the pay-packets of the workers! Perhaps, the Taoiseach could throw a little light on one aspect. When were these increases applied for? When did those who engage in the distribution of tea ask for an increase in price? When did those who make bread ask for an increase in the price of the loaf? When did CIE ask for an increase in bus fares? Would it be unfair to suggest that these applications were made some months ago and decisions were deferred pending the referendum?