I am not an economist and I do not pretend to know much about high finance but I should like to make a few remarks on some of the things which did strike me in regard to this Budget. As we had a new Minister for Finance introducing the Budget this year many people hoped there would be a new outlook in financial thinking which would give the people an uplift. I am afraid we did not get anything new in this Budget. I had felt the Minister might create a climate for investment and bring in new foreign investment by his Budget and I had thought he might put a stop to the Irish money which is going out in increasing amounts year by year to foreign money markets.
People have become cynical and this fact was brought home to me when I spoke on Budget day to people who did not even know that the Budget was being brought in on that day. On the day after the Budget had been announced I spoke to people who did not know much about the Budget and could not have cared less anyway. This sorry state of affairs has been brought about to some extent by high taxation. People no longer worry about increases in income tax and all the other taxes which are levied on them from the central authority and from the local authority through the rates. They merely took for increases in their wages to compensate for the higher taxes they have to pay. This brings about inflation which has been talked about so much over the last few years and to which the Minister devoted a fair amount of his Budget Statement.
The Minister has not grappled with the problem of inflation in this Budget. He is obviously hoping it will right itself but every person of common sense—one need not be very clever or an economist—knows that one cannot wish away inflation. Measures must be taken to control the finances of the State. The Minister has failed to do this and that is the biggest fault in this Budget. It is a standstill Budget. It does not do very much for anyone. There are a few increases in social welfare and there are taxes levied, taxes which some people feel should not have been levied. Some taxes may be justifiable. Others are not.
The increases given to social welfare recipients are far from adequate. They will not bring the benefits up to the spending power they had 12 months ago. Social welfare benefits generally are not high enough. The Minister really should make a better effort to give the recipients a living. They do not get that at the moment. Prices increased by 12 per cent in the last 12 months. Contributory pensions will be increased by 10 per cent. There will be a smaller increase in the case of non-contributory pensions. I suppose those on non-contributory pensions do not eat as much or drink as much as those who get contributory pensions. Invariably these increases come into operation from four to six months after the Budget. Invariably there is also an increase in the price of the stamp. The Minister should tell us in his Budget by how much he proposes to increase the price of the stamp to compensate for these increased payments. I suppose we can take it that the increase this year will be of the order of 3s—2s from the employer and 1s from the employee.
A new stamp is being introduced this year. The information given about this has been very vague and the Minister for Health yesterday gave literally no information in reply to questions on this matter. It is my opinion he did not want to give information. According to the Minister for Finance this new stamp will raise some £2 million in the period in which it will operate this year. We can, I suppose, take it that in a full year the figure will be £5 million. This stamp is introduced to cover hospitalisation. It will be a new tax on those who up to this had free hospitalisation. According to surveys carried out. 30 per cent of the population have medical cards; 15 per cent are in the higher income group. This leaves 55 per cent on whom will fall the cost of this new stamp. As a result of inquiries I know that 50 per cent of these are at the moment geting free hospitalisation. There are borderline cases; there are small farmers and businessmen who have to put someone in to look after their affairs if they are hospitalised and local health boards up to this have always taken this into consideration and refrained from charging these people the 10s per day for hospitalisation. Henceforth these people will not receive free hospitalisation. They will have to pay this tax, for that is what it is.
The Minister said it would be in or about 15 or 16 new pence. That would be 3s in pre-decimalisation currency. The Minister may be right. I do not say he is not right. All of us can throw our minds back to the time when we were told that the Health Act would not cost local authorities any more than 2s in the £. I do not think any of us ever thought it would remain at that figure. Neither did we think that it should remain at that figure. Naturally it would have to increase with increased costs. But no one ever expected that health charges would reach the astronomical figure they have reached from the point of view of rates at the moment. Indeed, the time has come when some new source of income will have to be found. Local authorities will have to shed this burden.
According to the Minister this new stamp will bring in £5 million in a full year. There are people who are already paying something in the region of 32s a week for the stamp. The Minister says the figure will be 3s; in five years time it could well be 10s, 15s or £1 on top of the cost of the present stamp. The Minister should have given us a better analysis when he introduced this.
The price of spirits will be increased as a result of the Budget. Spirits are a luxury. If people want to drink spirits they can pay for them. I have no complaint against the Minister on that score. However, the pint is a different matter. Everyone from the highest to the lowest drinks a pint. The man with the well-lined pocket can pay for it. Unfortunately we cannot charge him more than we charge the ordinary working man and, from that point of view, where the working man is concerned, this is a tax on leisure. To a great many people this leisure is essential, the drinking of a pint or two at night and a chat in pleasant company. The Minister should have left the pint as it was.
There is a problem in connection with drink and, perhaps, this is what influenced the Minister in raising the price of drink. There are many young people around the country, from 15 years up, consuming large amounts of drink and then, perhaps under the influence of drink, driving cars to a dance. This problem is causing great concern to parents, church authorities and to the public in general. Young people can go into lounge bars and I have never seen them challenged with regard to their age. I wonder have the gardaí ever checked on this or are they told to turn the blind eye to it in view of the amount of revenue being derived from drink? Bars are springing up all over the country. Premises nearly as big as aircraft hangars are being converted into lounge bars. This is bringing in tremendous revenue to the Exchequer. However, if we are to damage the moral wellbeing of our young people this is revenue the Minister could well do without.
It strikes me that the Garda force is not adequate to deal with the situation. The Minister, in his Budget, did not provide sufficient funds for the Justice Estimate in respect of the Garda force. He increased it by £1,500,000, which will provide 200 extra gardaí in the next year. I believe that if the Minister raised another £1,500,000 through some tax or other and told the people he was providing another 200 gardaí, they would not criticise the Minister but would congratulate him. If there is one thing people do not mind paying for it is protection, to know that they themselves and their families are secure, that their property is safe, that the gardaí are only around the corner from them and are ready to assist them when necessary.
Anyone who takes note of the Garda strength throughout the country—I do not know much about the city—will tell you that there are no gardaí readily available. They are trying to cover the same territory as before with half the numbers, racing around trying to give proper protection to the citizens. Another thing I noticed in the Estimate was that the provision for overtime for the gardaí is the same as last year. The gardaí are now working shorter hours and will not be able to cover the same amount of ground as they did before. With a small increase of 200 gardaí and only the same amount of money provided for overtime we will get less protection than we had heretofore. This is a very unhappy situation and I regret that the Minister did very little in the Budget to improve it.
I was also disappointed that the Minister did not reduce the very heavy company tax. From talking to people I am convinced that this tax is holding back the expansion of our industries. The British Government realised the threat to expansion of their industries and reduced the company tax to 40 per cent. The British Budget was introduced before the Irish Budget. It gave a lead to our Minister and I cannot understand why he did not take the lead and reduce this taxation. An English company might think Ireland was a good place to set up a factory having regard to the availability of labour and essential services, but having studied the company tax they would probably decide to establish the industry in Scotland, Wales or in the North of England where they would not get exactly what they wanted but at least they would not be taxed out of existence.
Companies must be left profits to expand. "Profits" is not a dirty word, and the Minister has missed an opportunity of giving the encouragement he should give to Irish companies to expand. They need extra money for stock and so on. The banks are very restrictive at the moment with regard to credit. I suppose the Government are taking too much out of the commercial and other banks who lend money. This means there is not enough money available for industry that needs it so badly to provide more jobs for the people who are leaving the land and for all the new people who are coming on to the labour market. We must either give these people jobs at home or export them to England or America. I can only take it from this Budget that the Minister is interested in exporting them.
The Minister provided extra money for the IDA. That is a very good thing, but it will be agreed that it is cheaper to provide new jobs by expanding existing industry. Then we know the kind of industries we have already. We have "fly-by-night" men coming in, men who even after the screening of the IDA and the various Departments go flop and cod the poor gullible Irish. In the long run I think the Minister would have done a better job if he had cut the IDA grant and given some relief to these factories.
The unemployment situation was brought home forcibly to me this week when a new fire station was opened in a small village in my county. I was flooded with applications for jobs as part-time firemen. It is only a small station and they would not be called out very often. When I asked them for their credentials I was shocked to hear they were all unemployed. It was disheartening to see so many able-bodied young married men unemployed. This is a serious situation and unless we tackle it rural Ireland will be depopulated. It would be a pity to see the fine young men who came to me during the week leaving rural Ireland.
I was disappointed that the Minister did not provide more money for housing. He has provided about the same amount as last year, taking into consideration the increase in the cost of materials. There was a shortfall in housing last year. There were only 3,900 local authority houses built. Of course we had the cement strike. The Department would not allow the house building anyway. Plans were sent back and forward so often that houses could not be built. I think every local authority had experience of this. The Minister must face up to facts and get down to providing houses.
There were a fair number of houses provided under the Small Dwellings Acts. This type of house was stepped up considerably. I can see that the Minister wants more of these houses built. Local councils are co-operating with the Department on this and it is a great exercise, but with the increase in the loan charges and repayments in the last two years even this type of house is going out of the reach of people for whom it was intended, people earning £20 to £25 a week. With the large increase in rates, and repayments having increased from 50 to 75 per cent over the last two years —this is our experience in Kilkenny— these houses are being put out of the reach of the people for whom they were intended.
One of the greatest drawbacks is the deposit which these people have to find. I often wonder why the Minister did not work out some method by which the young people who do all this drinking and spend all their money in the bars and dance halls could be encouraged to save. I know the Minister is taking money from them by way of drink tax but it would be much better if he encouraged them to save so that on marriage they could pay a deposit on a house and perhaps some of the capital. I wonder why the Minister did not establish house bonds which these people could buy at so much a week. These could be tax free and interest could be paid on them. The Government would have the use of the money. These things should be investigated. If we do not encourage young people to save for some specific purpose, they will not put their money in the post office, no matter how attractive the terms may be. These are things that should have been done and that have not been done. It is no harm for ordinary Deputies to say these things and let the people know we have views on these matters.