Deputy Bermingham spoke of the need for loans for small farmers. The ACC are sympathetic to small farmers as the record shows because 75 per cent of ACC loans are for amounts under £5,000. In suitable cases they give unsecured loans up to £2,000 where the repayment period is five years or less. In any financial institution or lending agency there are always customers who are dissatisfied and this will be true of the ACC also. It is necessary to stress that the record shows that the ACC exercise practical sympathy in regard to small farmers.
Deputy Crinion was concerned lest there might be an undue use of resources of the ACC in loans to big firms. Figures show that only £15 million out of the £105 million lending for 1977 will go to firms in the processing industry. The ACC are joint financiers with the banks of some quite big co-ops. I think these are fairly well known.
I was asked to comment on the section dealing with the control of the remuneration of the chief officer of the ACC. The provision is this regard is the standard provision which has been introduced as soon as the opportunity offers in relation to all State-sponsored bodies when the legislation comes before the House. Experience over a number of years has shown that any attempt at some kind of uniform approach to incomes policy can be totally defeated within the ranks of semi-State bodies unless some sort of overall control is exercised. That is why these sections are introduced in such Bills as they come forward. In the absence of that, there is, and has been for some years now, a form of non-statuatory control or persuasion exercised by sucessive Governments in this regard.
I am aware of the kind of problem that can arise. There may even have been one case in existence where the second in command was being paid more than the chief officer. I think this was what Deputy Bruton referred to. As Minister for Finance I am not prepared under any circumstances to tolerate a situation in which some board of a State body uses this lever in order to breach the overall control being exercised by the Government in regard to incomes in the public sector to ensure that some official who is not subject to this kind of control is paid more than his chief executive in order to force the Government to give way. If such a thing happened my reaction would be that the members of that board by their action are raising very serious doubts as to their competence and ability to fill the positions in which they are. I want to make it quite clear that would be my personal reaction. I was asked to comment and I am commenting.
On the other hand, there is the situation to which I think Deputy Bruton also referred which could arise, but in very rare circumstances, in which it would be necessary for a particular body to recruit somebody with unusually scarce skills and in order to attract him he would have to be paid remuneration in excess of that of the chief executive. That happens only very, very rarely. If it should happen that such a procedure is necessary the position could be discussed with the Minister responsible for the body concerned in consultation with the Minister for the Public Service and I am sure a solution could be worked out. We need not worry unduly about that; it is not the kind of problem with which we are normally faced; we are much more likely to be faced with the kind of thing to which I adverted a moment ago.
Deputy Callanan also referred to the necessity for the ACC to assess the man rather than the amount of land he had to offer as security in dealing with loan applications. I would agree with him. This is one of the reasons why in this Bill we are extending the definition of "permanent improvement purposes" in section 37. By doing so, we enable the ACC to assess a prospective borrower in terms of his personal enterprise and his farm plan and not purely in terms of what, in another context, is reffered to as bricks and mortar and, in this case, the extent of his holding.
Deputy Bruton referred to the possible need for a Government guarantee to the ACC for loans to certain farmers. That is what I took him to mean; perhaps he meant it in a wider context and meant a guarantee to the banks. I doubt if it is necessary or desirable but I shall examine the idea. I should like to make clear that at this stage, on the face of it, it does not seem necessary or desirable.
Deputy D'Arcy urged that depositors should be issued with pass books because he felt this would assist the ACC in getting more deposits, particularly from smaller depositors. The ACC are in fact organising this at present with the full support and consent of the Department of Finance.
Deputy D'Arcy repeated plea for the making available of current account facilities by the ACC in their various offices through the country raises a number of issues. The matter is not as straightforward as it might appear. I do not think it necessary to go into all the issues here, but one that should not be overlooked is the possibility of additional cost. Another Deputy referring to Deputy D'Arcy's plea said that this was a way in which the ACC could perhaps make more money and thereby help to reduce interest rates. If the ACC were to porvide this facility they would be depending on the banks to provide clearing facilities and they would have to pay the banks for this service. They might have to pay a very considerable sum for this. This is just one of the aspects of the matter which has to be taken into account.
I will look into the queries in regard to chattel mortagages, raised mainly by Deputy D'Arcy. The provisions on floating chattel mortgages seem to be very flexible. In this connection I refer the Deputy to section 30 (1) paragraphs (a) to (c) in the Bill. I will look into the points he raised. I think he may be under a misapprehension about it.
Deputy Bruton raised the question of the statutory restricitions on a floating charge being placed on the assets of a co-operative. I will have a look at that point. I noted that, while Deputy Bruton raised the issue, he was very careful not to specify which particular way he wanted it dealt with.
Interest rates in the ACC were recently reduced. There are other terms available on loans from the ACC which are quite attractive and are not, as far as I know, available from any other leading source. This is reflected in the enormously increasing demand for loans from the ACC, Deputy Bruton also raised the question of term loans and their unsuitability for agriculture. He was referring specifically in this case to the banks. That, of course, does not come within the purview of this Bill. I will inquire into that matter in relation to the operation of the banks and the application of term loans to agriculture.
A point was raised by Deputy Burton in regard to section 3, the definition of "agriculture". That definition is not intended to be all-embracing and merely refers to agriculture as including certain items which are specified. I am sure it is felt that tillge is so obviously agricultural that it does not need to be included. Nevertheless, I believe Deputy Bruton may have a point considering dairying is included. It could, perhaps, be argued that, if it is, it is so obviosuly agricultural that it does not need to be. However, I will have that point examined.
Deputy Fitzpatrick raised the question of section 17 relating to membership of the Oireachtas or nomination for election or nomination to the Seanad and the effect of that on board members and employees. This section is a standard section which has been incorporated in numerous Bills in the past. Precisely the same form is used on each occasion. I do not want at this stage to get into a detailed argument on the merits or demerits of the provisions in it. If Deputy Fitzpartick, on consideration, wants to pursue this matter no doubt he will do so on the Committee Stage on that section. The difference in treatment between a board member on the one hand and an employee on the other is justified since, in the case of an employee, if he goes forward or if he is elected and subsequently loses his seat his livelihood is gone. That is not true of a board member, so in that sense that difference of approach is justified. In regard to the other question of mere nomination causing a director to have to resign——
