Ceisteanna—Questions. Oral Answers. - NIEC Report

8.

asked the Minister for Finance if the Government have considered the statement in the latest NIEC Report that it is convinced that the stage has been reached at which future economic growth may be in serious jeopardy; and what their views are in relation to it.

The answer to the first part of the question is: "Yes".

As regards the second part, the NIEC Report was chiefly concerned with the tendency for incomes to increase considerably faster than national output. Unless checked, this could jeopardise the expansion of exports upon which future economic growth depends. The views set out in the report in this regard are in line with those held by the Government as expressed by me in my television statement of 18th March last in the course of which I said:—

In this sort of situation it is just not possible to contemplate a general increase in costs and incomes of the size involved in the maintenance men's settlement. Any such development would bring a major crisis upon us.

The Government's concern was to bring home to the public the economic consequences that would follow if incomes were to continue to increase at a much faster rate than the economy could sustain. This I made clear in my statement in Dáil Éireann on 15th April when I said:—

I went on television to point out dangers and I did not say at any time that there is an economic or financial crisis or even that there need be one. All I wanted to get across to the public was that if there were unreal expectations of income increases which the economy could not sustain then we would have difficulties and perhaps a major crisis.

Would the Minister not agree that the NIEC Report is one of the most serious assessments of our economic prospects that we have had before us for a long time and that he is blowing hot and cold on this whole subject? Further, would he not agree that he has changed his attitude completely in regard to one statement he made on television about a fortnight ago about the serious economic position facing the country and will he now tell the truth to the people?

I do not know what more I can add. I accept that these NIEC Reports are very valuable but I do not necessarily accept everything in the NIEC reports nor would the NIEC expect me to. They are very valuable and very informed comments on our economic situation and other problems in the economy and they are very useful, but every Member of this House is entitled to take his own view as to their validity or application. I do not find any conflict whatever between the comments in the NIEC Report and my own approach to the economic situation over the last couple of months. At all times I was simply concerned to endeavour to point out that if certain trends and tendencies were maintained it would mean that we could have a major economic crisis and major difficulties.

That is not what the Minister said on television.

You could have a credit squeeze and import restrictions and all these things if the annual expectations of income increases, which seemed to be around in the earlier part of this year, were allowed to be realised.

Would the Minister not agree that on television he used the words "in view of the serious economic position in which we find ourselves" and later on he stated that "everything we have is at stake"? How can he reconcile those statements with the statement he made here in this House about a week ago and with the NIEC Report? Will he further inform the House if the danger now is that he may use the Budget as a political weapon rather than as a financial process to help the country's future? He is playing politics now as his Party did in 1965 when we were facing a financial crisis and they denied that in March before the election but admitted it——

The Deputy cannot make a speech on this.

——immediately after the election. Now they are doing the same thing and the Government want to keep the truth from the people because we may be facing a general election.

It is the Deputy who is playing politics. The economic management of this country is not an easy thing at any time. We in the Government were very seriously concerned that the inflationary pressures building up at the start of the year could, as I said in my television broadcast, put everything we have at stake. In other words, if the inflationary tendencies were to accelerate then the whole structure of the economy could be endangered. This was what I was at pains to try to bring home to the people and I brought it home successfully.

Two years too late.

There is in the trade union movement a very satisfactory response to what I said and a very responsible attitude and I would hope that the responsible attitude of the trade union leaders would be mirrored in the approach of Deputies opposite.

Question No. 9. I am calling Question No. 9.

I want to ask one final question. While the Minister may have brought this home to the people is it not true that while those inflationary processes were building up and while a strike was in progress for six weeks, the Taoiseach maintained a closed mouth and never uttered one word of guidance to the people and it was left to Mr. Dunne to give any guidance that was given and to speak out in the national interest and it was only when the stable door was closed that——

This is an entirely separate question.

I should like to comment on that. At the beginning of this year, before the maintenance men's strike, the Government published a very comprehensive and factual review of the situation pointing out what the dangers were on the incomes front. When the maintenance men's dispute had escalated into a strike I do not think, and I would maintain this position very firmly, that it would have been appropriate for the Government to interfere during the actual currency of the strike or to say anything that might exacerbate the difficulties of the situation. Any intervention by me or any other member of the Government along the lines suggested by the Deputy during the currency of the strike could only have done damage.

Question No. 9.

Would the Minister tell me if he considers that the NIEC Report is to be accepted by him where he agrees with it and not accepted where he does not agree with it?

What is the purpose of the exercise then?

What is the purpose of Government?

We have many excellent organisations and institutions available to give advice to the Government on these very complex problems. The NIEC is one of them, and the job of the Government is to accept the advice offered to them from different directions and from different quarters, to study all these and to come to their own decision.

That is what it is all about.

(Interruptions.)

I only wish every Deputy was as responsible in his approach to these matters as Deputy Tully.

The Minister is the most complete fraud in this House.