The Minister for Industry, Trade, Commerce and Tourism to resume and he has 23 minutes.
Private Members' Business. - Food Subsidies: Motion (Resumed).
The following motion was moved by Deputy B. Ahern on Tuesday 23 October, 1984:
That Dáil Éireann condemns the halving of the subsidies on bread, butter and milk at this time because of the serious and widespread hardship caused to the poorer and weaker sections of the comunity and calls on the Government to restore the subsidies immediately to their previous levels.
Debate resumed on amendment No.a1:
a1. To delete all words after “That” and substitute the following:
Dáil Éireann, recalling its approval of the National Plan "Building on Reality", approves of the steps taken by the Government to reverse the deterioration in the nation's finances and to safeguard the standard of living of the less well-off.
—(Minister for Finance)
The situation faced by the economy has altered beyond recognition since food subsidies were first introduced in Ireland in 1975. Since then the taxpayer has spent some £550 million or over half a billion pounds on food subsidies. Given our high level of unemployment now one must ask if this was the best use of money, seeing that it was all borrowed.
At the time food subsidies were first introduced the Irish national debt stood at £2,700 million and our foreign debt was less than £700 million. In the nine years since then the debt has risen to around £17,500 million of which the external component is now nearly £8,000 million or almost three times the entire debt of 1975. If we had not borrowed more than half a billion pounds to pay for food subsidies in the intervening period our foreign debt would now be less not only by that amount but in addition by the interest payments which have had to be made each year since then on the amount expended. Indeed, the interest on £550 million this year will cost the taxpayer around £70 million.
The job crisis that we are facing in the mid-eighties was entirely foreseeable during the seventies. The children now leaving our schools and seeking work, and finding it so difficult to get it, were all in school at that time and they were on the records available to the Governments of the day.
While there was justification in the short term for counter-cyclical deficit budgeting in the immediate aftermath of the 1973 oil shock, the sensible policy for Government to have pursued in Ireland during the bulk of the seventies would have been that of a balanced budget. This would have enabled the setting aside of resources during that period to deal with then foreseeable problems that were going to arise in the eighties with the large influx to the workforce which is now and could then have been predicted as taking place. Instead, the Governments of the day right through the seventies ran very substantial budget deficits which now have to be paid for by high levels of interest payments and debt repayments.
That is one of the clearest and most damning indictments of this Government.
Were it not for interest that had to be paid on debts, Ireland would now have a much greater capacity to deal with the unemployment problem of the eighties. Indeed, without interest on past debts we would have a budget surplus in this year. Instead, as a result of our having spent money on various types of expenditure, including food subsidies, during the seventies which we were not paying for out of current taxation, we have put Governments in the eighties in a position that they are not able to cope adequately with the unemployment problem. This is the reality of the situation against which this debate must be judged.
The Government have now decided to redress the situation by a planned and gradual reduction in borrowing. One of the methods that they are forced to use to achieve this is a phasing out of food subsidies, but this is being done in such a way as to protect the position of less well-off families. The final phase in this reduction of food subsidies will be accompanied by the introduction of child benefits at much increased levels. This will bring a very large increase in the income available through children's allowances to mothers with children. This is a better way to help families than through food subsidies which go to all families, rich and poor, adults and children, alike.
However, people should not think that this is some sort of drastic financial policy that is now being pursued. In fact, the current budget deficit in proportion of GNP in 1987, after all the planned measures have been implemented, will still be higher as a percentage of GNP than the deficit in the United States is at the moment. We are all aware of the public controversy in regard to a 4.5 per cent of GNP deficit in the US yet when all these measures, included in Building on Reality have been implemented, our deficit will, even then, in 1987, be 5 per cent of GNP for current spending. Additional borrowing for capital purposes will bring the total Exchequer borrowing requirement to nearly 10 per cent of GNP.
The problem is, of course, that so much of our money will have to be used to pay interest on past debts that this makes it very difficult to move any more quickly than we are doing to eliminate our current budget deficit. As the Economic and Social Research Institute pointed out, every additional year when one has a current budget deficit one passes on to the following year an additional interest problem. This makes the closing of the gap in the following year more difficult than it would have been if there had been no deficit the previous year.
This is the financial treadmill on which this generation has been placed by the financial policies throughout most of the seventies. I have said that I except from that criticism the immediate aftermath of the oil shock of 1973 when for two years or so deficits were justifiable as a counter-cyclical measure. However, it is in general a tragedy that resources, which should have been held over until the eighties to deal with a completely foreseeable jobs problem now occurring in the middle of this decade, were used up in current budget deficit in the seventies and the first year or two of the eighties.
Food subsidies, while useful if we can afford them, are not the best way of overcoming inequality in our society. The single greatest cause of inequality in this country at the moment is unemployment. Unemployment not only gives rise to inequalities of income between families, it also undermines the dignity and spirit of people. The plight of the long term unemployed calls for direct action over and above the provision of income maintenance or other types of benefit. Without new initiatives in this area many of the long term unemployed who retain the capacity to contribute usefully to economic activity might not have the opportunity of re-entering the workforce in the foreseeable future.
Policies are already in place which offer assistance to the long-term unemployed. The success of the enterprise allowance scheme shows that it is clearly filling a need. By September of this year almost 3,500 unemployed persons had availed themselves of the opportunity to establish their own enterprises and this number is growing week by week.
A new scheme for social employment is now to be introduced. It will provide part-time jobs for 10,000 long-term unemployed within the next 12 months. A new training and placement scheme for the long-term unemployed will give a new chance to 2,500 people a year for a six-month period of each year.
The Government have also recognised the need to boost the construction industry. In addition to the expansion of industrial grants there will over the period of the plan be:
—An increase of £53 million in the annual capital provision for major roads. This will raise the level of activity in this sector by 10 per cent above that previously proposed in the national roads plan.
—There will also be an increase of £32 million in capital investment in education. Total educational investment over the plan period will be £320 million.
These and other projects under consideration will between them provide several thousand additional jobs in the construction industry, reversing the decline in employment in this sector.
These measures directly concerned with the creation of employment are a better use of money than the payment of food subsidies. Like all Members I would like to be in a position where we did not have to choose between food subsidies or spending money on employment creation, but the reality of our financial situation is that we have to choose. Indeed, to govern is to choose. The Government are right in believing that we must choose to put in place measures that would help in the creation of employment.
In addition to policies on employment creation the Government have, in their social policy, given priority to assisting the less well-off. This must necessarily involve some greater selectivity to ensure that the weakest members of the community will not be the ones to bear the greatest burden of the measures which must be taken to ensure the future welfare of the community. Let me outline some of the ways this increased focussing of public expenditure on the less well-off is to operate in practice. The living standards of those dependant on social welfare will be safeguarded by keeping long-term payments at least level with inflation and short-term disability and employment payments in line with take-home pay.
The introduction of the family income supplement has been brought forward to address the particular difficulties of those who, heretofore, could have lost out financially by taking employment. There will be significant changes in housing policy. A new grant of £5,000 is being introduced to assist local authority tenants who buy private houses and thus make available a local authority dwelling to others who might be on the local authority housing list.
The education system is being developed in accordance with the programme for action in education. This will lead to a closer relationship between education and modern society and between education and the world of work.
Indeed, it will also lead to the expenditure of significant sums of money on those disadvantaged areas in our community where education is more needed than anywhere else. Expenditure of this kind to directly help those in need, particularly to help those whose need is created by their inability to cope with society through lack of education, is the best way to deal with the problem of poverty in our society rather than giving across the board food subsidies which everybody, regardless of means, enjoys. Indeed, in absolute terms the better off people are the more they benefit from food subsidies.
That is not true.
I said, in absolute terms, in the sense that they spend more.
This is a very confined debate and there should not be any interruptions.
A central theme of these developments has been support for the individual family. In the context of the many different services and payments provided under the ambit of the social services we must never lose sight of the objective of a caring and supportive society, a society whose bedrock is the family. The formation and cycle of a family leads to many different and varying demands on its members and resources. Many studies have shown how family size and age can be a major factor causing inequality and hardship.
Many families whose gross incomes might suggest they are well off by comparison with some simplistic average find themselves experiencing real financial hardship in their attempts to provide the opportunities for their children to allow them to realise their potential.
Too much of social policy here is governed by crude references to gross income levels without taking adequate account of family responsibility at a particular time in the family cycle. Very often measures that are designed to redistribute income to the less well off do not always do so because they are given to people who have little or no financial responsibility when others with nominally higher incomes but with much greater responsibility are in a worse situation relatively speaking in terms of disposable income.
The importance of the family and the needs of its dependent members is reflected in the Government's proposals to give a high priority to education and, in particular, to support those who might otherwise prematurely leave the education system. Thus primary education will be treated as a priority, together with special funding for disadvantaged areas. A new child benefit scheme is also being designed to ensure that policies are sensitive to the needs of large families.
In essence I am saying that the Government's social policy is being designed to give more help to those who need it most rather than giving indiscriminate help across the board through blanket measures such as food subsidies. That is not to say that food subsidies are not a good thing if we could afford them and when we can afford them. It is simply saying that when one has to choose one must look, if one has scarce resources, at other more direct and immediate ways of helping those who need help either to find employment or to acquire the education or the income necessary to break out of poverty in which so many of our people find themselves at this time.
The policy being pursued in this area is a responsible one. It is not responsible — I appreciate fully that the Opposition have a role to perform in this area of opposition — to pick out one measure like the food subsidies and say that they do not like that without seeing the choices that have to be made within the overall framework of Government finance. While I can see that the Opposition have a role to play in opposing this I believe a lot of the problems of the country, in regard to industrial relations and elsewhere, have arisen because people are more concerned with playing a role and saying, "That is not my job. My job is to demand the most I can get for my members" or "My job is to maximise the profits for my shareholders". If we could look a little more at the problems as the person on the other side of the table sees them we might be better off. However, that is very much obiter dicta in this instance. The approach we are adopting, which is one of a selective policy, is a better one and is more likely to yield results than the other policies which, frankly, we cannot afford.
I will not bore the House with the irrelevant pleadings of an even more irrelevant Labour Party on this issue but I cannot resist extracting one gem from Deputy Barry Desmond who has a responsibility in Government for Social Welfare and the care of those most in need. I will refer to just one gem of the numerous statements that have emanated from the Labour Party. In October 1979 he said that reductions in food subsidies are reflective of a philosophy which he just did not like and could not support. I cannot give that statement the emphasis and solemnity that Deputy Barry Desmond gave it but in itself it dismisses the irrelevancies of the irrelevant Labour Party.
I should like to focus on the reasons given by the spokesman for the Government, in the absence of the Government, in early August when the cuts were announced. The first thing that emerges clearly from all the statements by the ubiquitous Government spokesman was that the decision was attributable to the rising level of interest rates and the appreciation of the dollar against our currency. It was stated in The Irish Times of 3 August:
So far this year, the rising level of interest rates and the dollar has added approximately £140 million to the bill the Government will have to meet when it introduces its budget next January.
Therefore, the connection was established on the first day by the spokesman who made the announcement in the absence of Ministers, some of whom were said to be sunning themselves in foreign places. Some of them, unfortunately for themselves, were still at home and were prepared to announce decisions taken by Deputy Bruton who, it must be said, is consistent. These increases of 2p on the pint of milk, 8p on the pound of butter, 8p on a loaf were, we were told, necessary as a compensatory factor because of the increased cost of servicing dollar interest rates and the appreciation of the dollar against our currency.
Labour Party philosophy has always been opposed to cuts in food subsidies, yet we can read a little gem from the Minister for Labour in the Irish Independent. The heading was truly in line with what he said: The subsidy had to go to pay the public sector. He is quoted as saying that it was essential to raise the necessary funds to pay teachers, gardaí, nurses and the like. The people in those professions are, by definition, concerned with the needy, the young and the unemployed. The gardaí cope with the consequences of unemployment and nurses have to cater day by day in overcrowded wards with the consequences of an uneven society. Such a statement is an offence to them.
In The Irish Times of 4 August the Tánaiste, in the absence of Fine Gael Ministers, said:
The Government is facing an interest Bill of £830 million next year on foreign borrowings of £8 billion.
The total foreign debt of the State is now £10 billion. He further stated:
This would have been £100 million less were it not for the fluctuation of the £5 billion borrowed in floating currencies and the £3 billion borrowed in dollars.
In the last few days, the dollar borrowings have added an extra £25 million to the interest bill for next year as a result of the strengthening of the dollar.
The connection is clearly established that what we have is a decision by the Government that the poor, unemployed and low income groups are to be forced to pay for the consequences of the increased cost of servicing the foreign debt.
Since this Government took office the total foreign debt has increased by over £3 billion since December 1982 to a figure in excess of £10 billion. So much for what the Minister said: the Government are moving towards a phased and planned reduction of the debt. If "halting" and "reversing" means "increasing" then the promise of reducing foreign debt, which has grown by £3 billion, is poor consolation for the economy and for those who are the worst off in our community. They have to pay for the disastrous Government decisions.
The Minister for Finance made the disastrous decision to switch the major portion of our new foreign borrowings from EMS currencies, against which our currency has remained reasonably stable and interest rates have remained reasonably stable at 5½ per cent, to the dollar against which our currency has depreciated by 33½ per cent and where interest rates have gone through the roof. The consequences of that disastrous decision of this expert economist is that those in society who can least afford to do so will pay for it.
I acknowledge the consistency of the Minister who is present. On his own admission yesterday, he said there was an increase of 135 per cent in unemployment in the past five years most of which has been in the last two years.
No it was not.
He made the statement that manufacturing employment is still falling despite export growth. At a time when unemployment was increasing the Government chose to reduce food subsidies. That is a scandal. There used to be an old song in my college days to the tune of "The Red Flag" and it tells the working class what they can do because "I have got the foreman's job at last". The Labour Party have taken that view — they may not have the foreman's job but they have a job and the working class can do as the song said in my student days.
The Minister for Finance has taken a decision and the poor people have to pay for the consequences of it. He has never shown much sense of human concern for the poor and underprivileged. They do not find much place in his cold, jargonistic analysis. Instead of protecting those who might perhaps be the only justification for us to be in public life, we are making them the victims of something they had nothing to do with: switching to borrowing in dollars. We should be protecting the poor from whatever economic problems occur.
The Minister for Finance tried to justify his callous decision on the same basis as the Minister present did and that is that food subsidies discriminate in favour of the rich. That is callous in the extreme. Let me demonstrate why. When did anyone of us, the Minister, the Minister of State or myself, last sit down to a meal of bread, butter and tea? Many of those who are affected by this decision sit down every night to just that kind of diet. We know that is the reality when we visit working class areas. We are expected to ignore that. There are statistics to support the case, never mind the bleatings of the irrelevant Labour Party and all they have said over the years. The CSO have taken a bashing in recent times but this statistic was accepted by all. The household budget statistics indicate that the lower income group spent 20 per cent of their disposable income — we are not talking about much when we speak of their disposable income — on bread, butter and milk as against what for the rich for whom food subsidies are meant to discriminate in favour of? Four per cent of their disposable income. That is the reality which enabled Deputy Bermingham's party to come in here and bleat at the hint of a reduction in food subsidies.
I find it objectionable that decisions which have never been referred to the House to increase the dollar borrowing against which our currency has depreciated and which have given rise to an extra £140 million on our budget for next year should be paid for by the poorest elements in the community. I am not alone in making that connection. It was made by every Government spokesman at the time in the absence of any Minister to face the press or the public. If we are to have a review about borrowing strategy, the currency in which we borrow and the increased cost of that, let such a review take place here. The Minister for Finance has refused to account in any way to the House or to the Committee on Public Expenditure of which I am a member. Seven weeks ago we asked the Minister or his representatives to explain to us why they shifted to borrowing in dollars with increased interest rates for which the poor must now pay. The Minister has ignored that request. He did not come to the committee and has not come in here. That shows contempt for the House. It could be said that it is contempt for the Labour Party who have bleated over the years.
In a famous statement made by Deputy Quinn on 6 October he said he was very happy that the voice of Labour was being heard loud and clear at the Cabinet table. I wonder what would happen if their voice was not being heard. People are being asked to ignore the reality. Contempt is being expressed here for the loud and clear voice of the Labour Party. Whatever about contempt for the House, and that is there or contempt for the Labour Party, which may be deserved, contempt for the lower income groups should not be tolerated.
The Minister for Industry, Trade, Commerce and Tourism spoke this evening about the construction industry. That is irrelevant to the question of food subsidies. However, I respect and admire the Minister but I find objectionable the contribution made by his colleague, the Minister for Finance, who implied that the removal of food subsidies was a matter of equity, that it was done in the interest of the poor as against the interest of the rich. That implication is objectionable not only in terms of truth but of those whom the Minister would claim to have been thinking of when removing the food subsidies. Maybe the Labour Party will back their voices with their actions this evening though I do not believe they will. In any case, their constituents will be interested in hearing how they vote.
I am pleased to have the opportunity to support the motion tabled by Deputy Ahern and I trust that it will receive sufficient support. I wish to add my voice to the condemnation of the Government for their removal of the food subsidies and for the manner in which that change was announced.
In June last, the Taoiseach speaking on the Estimate for his Department outlined what he regarded as the achievements of the Government but he was very careful to avoid any mention of the removal of food subsidies. He gave no indication then of what the Government's intentions in this matter were. It was left to the Tánaiste and Leader of the Labour Party to announce the bad news and that was at a time when the Taoiseach and many other members of the Cabinet were out of the country.
It is almost incredible that, having regard to the views expressed down through the years by the Labour Party in respect of food subsidies, the announcement of their removal should have been left to the leader of their party. Many references have been made during the course of this debate to what the Minister for Health and Social Welfare had to say from time to time on the question of food subsidies. He said, for instance, in November 1978 that those who benefitted from food subsidies were the large families, the poor and the elderly, that proportionately they spend more of their income on food than do any other group. He went on to say that food subsidies represent only a very small item in the national budget and that it would not upset any Minister's calculations to continue the subsidies for another 20 years, if necessary. One waits anxiously to see how Deputy Desmond will vote on the motion this evening. Will he honour the concern expressed while in Opposition for the less privileged or will he follow other members of the Labour Party who were critical of the national plan when it was produced but who will be prepared to troop into the lobbies to vote against our motion?
I represent the constituency of Dublin South-West and that includes Tallaght and part of Clondalkin. I regret to have to put on record that many of those people to whom the Minister for Health and Social Welfare was referring live in that constituency as the figures indicate. In the Tallaght area, for instance, there are between 4,000 and 5,000 people unemployed while the corresponding figure for Clondalkin is 2,000 people. In Dublin as a whole there are between 60,000 and 70,000 registered as unemployed. I extend an invitation to the Ministers for Finance, Health and Social Welfare and Industry, Trade, Commerce and Tourism to come out to my constituency and see for themselves the problems of the area. Only then will they realise the need for food subsidies. If there were sufficient time to allow them make that visit before the vote is called, they might change their minds and vote for our motion. If one were to call to any group of ten houses in parts of Tallaght one would be likely to find seven of the ten families concerned in which no one was earning any money while in another group of ten houses one might find eight families in the same position. These are the circumstances that those of us who represent the area must try to deal with.
The Government have described themselves as a caring Government. Where is the evidence now of that care? Will we witness it tonight when the division bells ring? The Government have done nothing either for the constituency of Dublin South-West or for any other constituency. Even at this late stage I appeal to them to show some compassion and to change their course of direction. Do the Labour Party subscribe to the concept of the Government being a caring Government? The constituency of Dublin South-West is represented also by the outspoken Deputy Taylor and by an ex-leader of the Labour Party, Deputy O'Leary. When the removal of the food subsidies was announced those two Deputies remained silent. I acknowledge that Deputy Taylor is a very active Deputy in the area and that is all the more reason why I was surprised at his silence on that occasion. In Tallaght there are between 4,000 and 5,000 people out of work; there are between 2,000 and 3,000 people unemployed in Clondalkin and last night, when the Minister, Deputy Bruton, was speaking here, he said that this side of the House had no solutions to the problems of the country. I should like to remind the Minister that last November when we were debating a Private Member's motion about Clondalkin Paper Mills, before the Minister of State at the Department of Industry, Trade, Commerce and Tourism, Deputy E. Collins, had finished his speech, a note was passed to him and he announced that the Government had entered into an arrangement with a Canadian firm to have Clondalkin Paper Mills reopened to employ 20 or 30 people. Is this how the Government are going to solve the unemployment problem?
The Minister for Industry, Trade, Commerce and Tourism, Deputy Bruton, said in his speech tonight that the way to solve the problem was to provide more employment and that this was of prime importance as far as the Government are concerned. The creation of 20 or 30 jobs in Clondalkin Paper Mills saved the Government, especially the Labour Party members. Is this their policy now to create more jobs in the Tallaght and Clondalkin areas? The manner in which the people of Clondalkin were treated on that occasion by the Government was an insult to them. If Deputy Dukes or Deputy Desmond took the time to come to Clondalkin or Tallaght they would soon see for themselves how bad things are.
When the Taoiseach spoke on the Estimate for his Department prior to the summer recess he made particular reference to the progress of the Government. He carefully avoided mentioning the removal of food subsidies. The manner in which the announcement was made by the leader of the Labour Party was greeted with dismay and disgust. I ask Deputy Desmond and Deputy Taylor to support the motion tabled by Deputy Bertie Ahern.
There is nothing in the national plan to help the constituency of Dublin South-West or any other constituency. We heard proposals which are expected to bear fruit in 1986 or 1987. Today's problems require immediate attention and action and the policies pursued by the Government do not go any way towards solving the problems. Indeed they will create more problems. There is no incentive for industrialists to come in here. If the present trend continues we will have far more people on the unemployment register than are employed. Is this what the Government stand for and is this the part the Labour Party are playing in so far as policies are concerned?
Deputy O'Kennedy referred to the statement of the leader of the Labour Party that there was a greater implementation of Labour policy in Government. The Labour Party have always supported food subsidies and how could they support their removal? The main food for poor people consists of bread, butter and milk which is their staple diet. What else have these people to live on? The Labour Party have supported an increase in the cost of these foods. Is this what they stand for? It is a shame for the Labour Party to be part of this policy. Even at this late stage, I would ask the Labour Party to heed the people or to pack their bags. If they do not, the people will tell them to do so when the time comes.
Listening to the last speaker one would think that his heart was bleeding for the poor. I have some sympathy for his views but his concern is of quite recent origin. I have a copy of The Irish Times of 31 July 1982. At that time he and other Members supported the Fianna Fáil Government when they made cuts in food subsidies.
(Interruptions.)
Please do not interrupt me as I listened to a lot of rubbish here tonight. The Deputies opposite changed their tune in a dramatic way since 31 July 1982.
People had jobs then.
They had like hell. Free speech in this House is important and I did not interrupt anybody. I have stated my position quite clearly and there is no doubt in anyone's mind about where I stand in the matter of the removal of subsidies. I was disappointed with the way they were announced by the Government. However, having said that, I want to expose the blatant hypocrisy of members of the Fianna Fáil Party in putting down this motion. Their record on subsidies is very shabby. Measures announced on 31 December 1978 confirmed that subsidies would be removed from the following January. This resulted in the following price increases: 8p per lb. on butter, 2p per pint of milk and 2.5 pence per kg. of flour. These measures were introduced by Fianna Fáil at a time when The Workers' Party were climbing over the barriers here to support them.
But Deputy Barry Desmond said it was a disgrace and that he would never do it.
Order.
The then Minister for Finance, Deputy MacSharry, said that the alternative to the removal of the subsidies was to impose extra tax or increase borrowing. That was his excuse in his own constituency as reported in The Irish Times on 31 July 1982. Now we have Fianna Fáil falling over one another worrying about the poor. I mention Deputy Sean Walsh in particular. I am surprised at him.
(Interruptions.)
I suppose the Minister of State cried his way around County Kildare.
I never went in for blackguarding. I made my own points at election times and the people always considered me a fair and honourable man. These are the things which were done by a Fianna Fáil Minister in 1982. Now they are crying out "O Lord, that is a terrible thing to do". That is the hypocrisy of the people who put down this motion. They took the action I have described in July 1982 and over that barrier came The Workers' Party to support them.
They jumped from the platform.
I do not like increases in the price of food. Let us be under no illusion. No Deputy in his sane senses would like to increase the price of food, but the hypocrisy of this motion has been exposed. Let us consider why this is being done. I have exposed the fact that Fianna Fáil were not concerned two years ago and are not concerned now.
They were not concerned in 1951 or 1957.
This motion was not put down by Fianna Fáil because of their concern about the people whom they say are being destroyed. Their purpose is to embarrass certain people supporting the Government but when I am embarrassed by the hypocrisy of Fianna Fáil in putting down motions it will be a funny day in my life.
It is widely recognised that food subsidies are not the best way of helping the poor. It was a blunt instrument used at times with my approval, but it helps the rich as well as the poor. It benefits those who hold large banquets and some unscrupulous bakers were using subsidised flour in order to ——
Is the Minister of State opposed to food subsidies?
I sat here for half an hour and listened to a lot of trash. I did not engage in that kind of heckling. I am entitled to make my point but if Deputies wish to heckle me I am prepared to take them on. I have never interrupted anybody in this House. It is not my custom. I have a right to make my point clear. It could be argued that food subsidies are not the proper way to use taxpayers' money because it subsidises functions and dinners. The best way to use taxpayers' money is to improve social welfare. It is a better way to improve the lot of the lower income groups. The interests of the less well off are best served by such means. Fianna Fáil put forward that argument for many years and they would be better advised to stick to that logic. They have put down this motion because they want to embarrass me and other members of the Labour Party. I am under no illusion as to why this motion was put down. Let us say it was politically wise.
(Interruptions.)
I would ask Deputies to shut up while I am in possession. I am hurting them now and that is why they are interrupting. They cannot take it.
(Interruptions.)
I would ask Fianna Fáil to stick to the argument they put forward over the years. They are now saying something different. I nearly felt like crying myself when I saw them crying for the poor.
(Interruptions.)
I would ask Deputies in Opposition to conduct themselves while the Minister is speaking.
During Deputy Eileen Desmond's term as Minister, social welfare benefits were increased by 25 per cent.
That includes Deputy Andrews.
I was just saying that the Minister was shouting, not speaking.
I have to shout to be heard because of the ignorance of the people opposite who are interrupting me. It is necessary to shout in order to be heard above these concerned people who are changing their tune so often. Since that year there has been a greater increase in social welfare payments than in the CPI.
The Government are going to tax social welfare payments.
Deputy O'Keeffe, please conduct yourself.
I will claim time if I am continually interrupted.
No injury time.
There were a fair few injuries the night they broke the doors throwing in lads during the leadership crisis.
What about Labour Party policy?
I will continue if Deputies opposite are inclined to let me. I think they are not. They do not want to hear what I have to say. It is not going down too well with them and the interruptions are a sure sign.
The Minister to continue without interruption. He has five minutes left.
My time was taken up with Fianna Fáil interruptions. I object very strenuously.
(Interruptions.)
If Deputy O'Keeffe talks much longer he will be talking outside the door.
I am claiming five minutes from now.
The Minister has four minutes to conclude.
The hypocrisy of Fianna Fáil amazes me. I want to claim credit for the Labour Party for what I am about to say. When I started speaking this evening I said I did not like the idea of cutting food subsidies nor did I like the way these cuts were introduced. I ask Deputies to hear me out. I will have to shout because I am about to be interrupted. I said that because of the hypocrisy of Fianna Fáil they were not going to get me to back this motion which was put down deliberately for political purposes and backed by The Workers' Party. The 1982 figures which I read out were backed by The Workers' Party who climbed over the railing at the back of the Chamber to vote. Let us be honest: that is hypocrisy at its worst. Because of the Labour Party's intervention the family income supplement scheme was brought forward to 1 September——
(Interruptions.)
That is all in mid air.
I never interrupted Deputy Connolly in my life.
I accept that.
Then shut up, please.
I want to put the Minister right.
The Deputy can meet me any time to put me right but I am making statements here that I know are true. Because of Labour Party intervention after the reduction of the food subsidies——
(Interruptions.)
If the Deputy wishes to leave the House he can.
——the family income supplement scheme was brought forward to 1 September. That was in the best interests of the poorer sections of the community which I am proud to represent. I challenge anybody here to prove that that is not a better way to help the less well off. Since we came into power we have consistently increased social welfare benefits and we reduced the qualifying age for the old age pension. That was never done by a Fianna Fáil Minister for Finance. Since 1973 we have been reducing the qualifying age for old age pensions——
(Interruptions.)
Fianna Fáil do not care for the poorer sections of the community. I have to shout because of these interruptions and the ignorance of the Deputies opposite. We have increased social welfare payments and succeeded in getting the Government to bring forward the family income supplement scheme.
That is all in mid air.
One good thing to come out of this debate is that at last Fianna Fáil recognise that there is the problem of the poor. We have been trying to tell them that for the past 20 or 30 years.
The Minister's memory is short.
Fianna Fáil Deputies have a galvanised neck to introduce this motion after what they did in 1982, 1979, 1968——
1957 and 1951.
In those years they reduced food subsidies and now because it is politically expedient to do so, they tell us that they are converted to caring for the poor.
What about all the Minister for Health, Deputy Barry Desmond, said?
We know where Fianna Fáil stand with regard to the poor. We know what they did down the years. Never in the history of the State did a Fianna Fáil Minister for Health or Minister for Social Welfare ever reduce the qualifying pension age because Fianna Fáil could never afford to do it.
I pity the Minister.
(Interruptions.)
Fianna Fáil are not the defenders of the poor. They are taking political advantage tonight and are trying to embarrass the Labour Party. If they think they will succeed in embarrassing me when they stand up here as champions of the poor, they have another think coming. There is no way Fianna Fáil can change their spots because it suits them politically and Fianna Fáil know that. As long as I can remember, Fianna Fáil had no interest in the poor, and I was one of the poor at several times of my life.
Under no circumstances can anyone take Fianna Fáil's motion seriously knowing their history on food subsidies is suspect. Deputy Sean Walsh may be misinformed — I consider him an honest Deputy — but he did not think back to the time when his party supported even more serious cuts. He should think again before he tries to embarrass me.
I am calling Deputy De Rossa who must conclude at 8.15p.m.
If the Minister comes to Clondalkin and Tallaght he can speak to the people there and we will look after him.
(Interruptions.)
Deputy De Rossa without interruption.
I sought time in this debate to support The Workers' Party amendment. The Minister who has just spoken, Deputy McLoughlin, and other Labour Party Deputies should have no trouble in supporting this amendment. It simply demands that the Government take action to ensure that the living standards of lower income families are not further eroded, and urges that any revenue required to restore the food subsidies to their former level be raised by the imposition of wealth, resource and land taxes, a realistic level of capital taxation, and a comprehensive drive to end tax evasion and avoidance, particularly by the business, self-employed and farming sectors.
I have no doubt that Fianna Fáil would not find themselves able to support that amendment nor would Fine Gael, but given the recorded policies of the Labour Party, there is no reason why they should not walk into the lobbies in support of that amendment tonight, just as we walked into the lobbies in October 1982 to defeat the Fianna Fáil Government when they introduced a policy which was directly contrary to the interests of the working classes. That is the challenge to the Labour Party tonight — that they do the same as The Worker's Party did in 1982——
The Workers' Party has three seats but came back with two.
——and vote against the Government. I challenge them to vote against the Government tonight in the interests of the working classes which they claim to support and represent.
This Coalition is a disgrace. It is both callous and cowardly because it picks on the section of the community which is least able to bear the cuts in their living standards. The cuts in food subsidies had the effect of putting a tax of 20 per cent on a loaf of bread and 10 per cent on a pint of milk. To recover that extra expenditure the working class would need at least £6 per week gross in their income, whether they be on social welfare or low wages.
The Labour Party have accepted the family income supplement scheme backdated by one month as the alternative to retaining food subsidies at their present level. They have gone even further. They have accepted a plan which will completely wipe out food subsidies in 1986. They have accepted a plan which brings 200,000 people on social welfare into the income tax net. At the same time, they have accepted a plan which takes 100,000 farmers out of the income tax net——
Is that right Deputy McLoughlin?
No.
Deputy McLoughlin should read the national plan. He obviously has not done so.
(Interruptions.)
There is no doubt the Labour Party will not have anyone voting for them. They will have neither the working class nor the farming community voting for them at the next election. They have abandoned tax reform. In the Eastern Health Board area they have cut the grants for children's clothing for the poorest people in the city. Under the guise of equalisation of social welfare for women, they will take up to £40 a week from families who are depending on social welfare.
Is the Deputy against equal rights for women?
Yet, this is the party that claim to represent the working class. I ask the Labour Party to rediscover their soul and to vote for the amendment put forward by The Workers' Party. Let them do the honest thing.
In July the Opposition voted in favour of cuts of £128 million. I know that a circus top blew down recently in Dublin but it seems it is up here tonight.
I should like to remind Deputy McLoughlin and the two other members of the Labour Party who are here of a quotation from a document produced by the Labour Party. I am referring to a magazine dated September-October 1984 entitled Labour Left, It quotes the leader of the Labour Party as saying with regard to the 1984 budget:
Several aspects of the budget were most satisfying from our point of view, notably the preservation of food subsidies.
He is also quoted as saying: "The Government has agreed that we must protect food subsidies."
That was only in January 1984 yet during the August weekend the Government shoved out a civil servant to announce that food subsidies had been halved. The Labour Party in a great fuss ran around trying to figure out what to do and they were told they could backdate the family income supplement. Of course what they conveniently forget to tell everyone is that the family income supplement will only be applicable to 35,000 people even though there are at least one million people depending on social welfare. Also, the family income supplement will apply only to those who have a job, not to people on social welfare. Before the debate ends will the Labour Party tell us what the other 965,000 people who are depending on social welfare are to do to recoup the subsidies on food that have been taken from them?
I should like to stress once again that the Labour Party should have no trouble in supporting the amendment put down by The Workers' Party. Up to now they have been a disgrace to the policies and to the founders of the Labour Party. Under no circumstances would they have supported the kind of policies promoted by this Government. It is clear that this Government are simply implementing Fine Gael policies. What we are getting are cosmetics and frills which the Labour Party are happy to accept and to go along with because they think if they vote against the Government tonight they will have to face a general election and they will be wiped out.
The decision to cut the food subsidies is regarded universally as the action above all other Government actions that warrants condemnation by every section of the community. It was an unforgiveable stroke of harshness. It was sneaky in its promulgation against the old and the weak in our community and the memory of it will live on. It will not die but it will linger on and haunt the Labour Party and Fine Gael until they finally succumb to the anger of the electorate at the next election. It will go down in the annals of political folklore in this House as a watershed for the Irish Parliamentary Labour Party when that political party sold their identity for just a few extra months in office in the "Mercs and Perks" brigade.
Let us call a spade a spade. Let us cut out the verbiage about deficits, foreign borrowing, the national debt and so on. There is nothing more fundamental to the diet of the poor than the loaf of bread, the pound of butter and the pint of milk. To attack the staple diet of the poor shows a cavalier disregard for one-third of the population who are on the breadline. It is farcical to suggest, as the Government have done, that bread subsidies affect the poor and the rich alike. The rich do not use bread to the same extent as the poor. Proportionately the poor spend much more of the incomes on bread and butter and not to appreciate this shows an alarming lack of understanding and concern for ordinary people. Added to this was the insult by the Tánaiste, Deputy Spring, when he stated that the poor do not use butter and one gets some idea of how out of touch are the Government with reality. The poor use butter and that is often their alternative to meat which they cannot afford.
Last night we heard from many speakers quotations attributed to the Minister for Health, Deputy Desmond, in support of food subsidies. Let us not forget that the same Deputy stated he wished to refute and denounce as wrong from the social, statistical and any other point of view the statement of the Minister that the rich benefit as much as the poor from food subsidies. We note also a statement from the same gentleman that he could never support the removal of food subsidies. We are asking him to live up to the written and spoken word on food subsidies.
What did the former leader of the Labour Party, Deputy Cluskey, have to say? He is on record as saying it was an incredible, unjust and insensitive decision and that possibly it was one of the most anti-children acts committed by any Government for many years. He said tens of thousands of children would go to bed hungry because these subsidies are being withdrawn.
Let us consider for a few minutes precisely what is meant by the reduction of the food subsidies. The Eastern Health Board have gone so far as to remove the comfort money from the old and the other people in our institutions. They will not get any increase this winter. That little sum of money they used to get to purchase a few comforts will be reduced. There are no ophthalmic services available to them. The word from the Eastern Health Board is that no forms will be available until after Christmas. Yet, the Minister for Health and Social Welfare, Deputy Desmond, says he is proud of what he has done so far as the health services are concerned. Does he realise what he is fathering? He is throwing 3,000 people out of work. He is closing hospital wards. He is refusing to appoint the consultants that are necessary to maintain the health wards. He is creating waiting lists as long as my arm in every single institution.
This is the man who is quite prepared to go on a collision course with the doctors and consultants. He is responsible for the creation of poverty in 1984. Still they talk about the family income supplement which will be made avilable.
Let me put this on record. There are 460,000 families getting children's allowances and we hear that 35,000 families will benefit from the supplementary income scheme. None of them has got it yet. What will the Government do with the 430,000 other families? Are they to be thrown on the heap and to suffer the indignity of poverty during the coming winter? The Government will do away with the rest of children's allowances and the rest of the food subsidies as well. Let us see precisely what they are proposing to do. I am taking an average family with two or three children.
Based on the consumption of five pints of milk, one large loaf of bread per day and two and a half pounds of butter per week, the reduction incurred on those items alone in August was the fine sum of £6.33 per month directly out of the pockets of the individual families who have to bear this burden.
The Government say they will give £30 per month per child in child benefit and that they will have levies on that as well. At present the family paying 45 per cent tax gets children's allowances of £12.5 per child per month. There is a tax free allowance at 45 per cent. That works out at £3.75 leaving a grand total of £15.80 per month. Take the child benefit scheme the Government talk so loudly about at £30 per month and income tax at 47 per cent this gives a figure of £14.10, leaving a net figure of £15.90 per month. In effect, they are saying there will be a gain of 10p per child per month as soon as they get rid of the subsidies, not to talk about the £6.33 lost per month after the removal of half the food subsidies.
A Deputy
The Minister for hardship is here.
Three card trick economics.
No Government in recent times have caused such resentment as this Government did by the removal of the food subsidies. Poverty is widespread. It is reckoned that one-third of the community are on the breadline. It was a cold, insensitive decision against the most defenceless people, the old age pensioners and the unemployed. These are the least organised groups and they have the least effective lobby. I suppose for that reason it was hoped that they might get away with it and leave them destitute. There is no way this party will stand idly by and let the Government bring back the relieving officer syndrome to the Irish way of life in 1984.
Where did we hear that before?
The subsidies were never more necessary than they are today. It must be borne in mind that as well as the removal of these subsidies price increases have gone out of control in the past 12 months. There has been a price increase of an average of 14 per cent in the ordinary everyday commodities used by the housewife since this Government took office. That is the kind of Scrooge mentality the Coalition Government have had since they took office. Last night the Minister for Finance attempted to make another Second Stage speech on his discredited plan, Building on Reality. There was one very interesting point. Right throughout his speech he never once referred to it by its name, Building on Reality.
I referred to it every time.
He skirted it every time despite the fact that in his written script the words Building on Reality were used many times. He was afraid to use the word “building” or “reality” because the building industry is shattered, half the workforce in the building trade are unemployed, and the reality is that what he did was unscrupulous and he had not the courage to stand over his own words. Social justice how are you. What kind of twisted gyration on social justice took 8p off the price of a half one and put up the price of a loaf of bread on the same day? We have listened to mountains of verbiage from Government spokesmen. The Minister had a cheek to put down his amendment because it stated that they had the approval of this House for the national plan. They did not.
We did indeed.
That plan was falsely based——
Eighty-two to 77.
——on dubious statistics and false assumptions. Every single economist in the country is on record as telling them they got their figures wrong. That is why there is no approval for the plan.
The figures that count are 82 to 77.
Deputy Flynn without interruption.
Deputy McLoughlin was the only Labour TD who had the courage to come in here last night and sit there throughout the agonising mealy mouthed attempts by Fine Gael Ministers to justify their misdeeds. I give him nine out of ten for courage.
(Interruptions.)
Deputy Flynn should not be interrupted by either side of the House.
After his first interjection last evening Deputy McLoughlin was visited by the Minister, Deputy Bruton, on the Labour benches and in two shakes he was silenced. I could not help but remember the shades of Garret FitzGerald on his bended knees to Jim Kemmy where Tomás Mac Giolla is sitting tonight.
It reminds me of Deputy O'Kennedy sitting in a chair beside Deputy Haughey.
(Interruptions.)
Let us deal further with Deputy McLoughlin, a man of some courage. An Evening Herald profile on him appeared on the very same day that, behind his back, the Minister announced the removal of the food subsidies. Deputy McLoughlin, fine socialist that he is, is on record as saying they would defend the food subsidies to the death. How does he square his attitude now? He will defend it to his political death. He is not so politically innocent that he thinks the Fine Gael masters will throw him a lifejacket when he is smothering to death politically in County Meath next time out.
Deputy Flynn may be smothering himself yet.
Where are his friends to come to the aid of the hapless Deputy McLoughlin and the Minister of State who was sent in to take the brunt of the venom from this side of the House this evening? Where is Deputy Cluskey who, when he was in Opposition, pontificated daily about high minded socialism? Where is Deputy Quinn, the reluctant Minister?
Where is Deputy Dessie O'Malley?
Where is Deputy Taylor who was so acutely embarrassed by the whole episode? Where is Deputy Bell, the man with the social conscience? Where are Deputy Pattison and all the other fine Deputies in the Labour Party? Last night Deputy Pattison crept in and, when he saw the benches empty, he realised he was in the wrong place and sneaked out the far side without going to the support of his friend, the Deputy from Meath.
Meanness was never a trait of the Irish people. We were always labelled as a noble, hospitable people. They were the hallmarks attached to all our efforts in the national interest. Penny pinching has no place in Irish life with the history we have. The tactics used by the Coalition are downright shoddy. They will meet with a quick response from the Irish people. Their social non-policy is destructive in its intent and its implementation.
Deputy Flynn should conclude.
I will conclude. What the Coalition have done will live on in the memory of many people and, at the earliest opportunity, they will be given the political death blow. They have dealt themselves a hand of jokers. They are cornered and trapped by their strategy which has been condemned out of hand and out of mouth by every worthwhile commentator. What they did in August was a desperate act by a destitute Government. Their time to quit has come. We offer them the road.
I would nearly give the Deputy a clap myself.
Order, please. Motion in the name of Deputy B. Ahern and amendment a1. in the name of the Minister for Finance. I am putting the question, "That amendment No. a1. in the name of the Minister for Finance be made."
The Dáil divided: Tá, 73; Níl, 68.
Tá
- Allen, Bernard.
- Barnes, Monica.
- Barrett, Seán.
- Barry, Myra.
- Begley, Michael.
- Bell, Michael.
- Bermingham, Joe.
- Boland, John.
- Bruton, John.
- Bruton, Richard.
- Carey, Donal.
- Cluskey, Frank.
- Collins, Edward.
- Conlon, John F.
- Connaughton, Paul.
- Coogan, Fintan.
- Cooney, Patrick Mark.
- Cosgrave, Liam T.
- Cosgrave, Michael Joe.
- Coveney, Hugh.
- Creed, Donal.
- Crotty, Kieran.
- Crowley, Frank.
- D'Arcy, Michael.
- Deasy, Martin Austin.
- Desmond, Barry.
- Desmond, Eileen.
- Donnellan, John.
- Dowling, Dick.
- Doyle, Joe.
- Dukes, Alan.
- Durkan, Bernard J.
- Enright, Thomas W.
- Farrelly, John V.
- Fennell, Nuala.
- Flaherty, Mary.
- Flanagan, Oliver J.
- Glenn, Alice.
- Griffin, Brendan.
- Harte, Patrick D.
- Hegarty, Paddy.
- Hussey, Gemma.
- Kavanagh, Liam.
- Keating, Michael.
- Kelly, John.
- Kenny, Enda.
- L'Estrange, Gerry.
- McGahon, Brendan.
- McGinley, Dinny.
- McLoughlin, Frank.
- Manning, Maurice.
- Mitchell, Gay.
- Molony, David.
- Moynihan, Michael.
- Naughten, Liam.
- Nealon, Ted.
- Noonan, Michael. (Limerick East)
- O'Brien, Fergus.
- O'Brien, Willie.
- O'Leary, Michael.
- Owen, Nora.
- Pattison, Séamus.
- Prendergast, Frank.
- Ryan, John.
- Shatter, Alan.
- Sheehan, Patrick Joseph.
- Skelly, Liam.
- Spring, Dick.
- Taylor, Mervyn.
- Taylor-Quinn, Madeline.
- Timmins, Godfrey.
- Treacy, Seán.
- Yates, Ivan.
Níl
- Ahern, Bertie.
- Ahern, Michael.
- Andrews, David.
- Aylward, Liam.
- Barrett, Michael.
- Blaney, Neil Terence.
- Brady, Gerard.
- Brady, Vincent.
- Brennan, Mattie.
- Brennan, Paudge.
- Brennan, Séamus.
- Briscoe, Ben.
- Browne, John.
- Burke, Raphael P.
- Byrne, Seán.
- Calleary, Seán.
- Collins, Gerard.
- Conaghan, Hugh.
- Connolly, Ger.
- Coughlan, Cathal Seán.
- Cowen, Brian.
- Daly, Brendan.
- De Rossa, Proinsias.
- Molloy, Robert.
- Morley, P. J.
- Nolan, M. J.
- Noonan, Michael J.
- (Limerick West)
- O'Connell, John.
- O'Dea, William.
- O'Hanlon, Rory.
- O'Keeffe, Edmond.
- O'Kennedy, Michael.
- O'Leary, John.
- O'Malley, Desmond J.
- Doherty, Séan.
- Fahey, Francis.
- Fahey, Jackie.
- Fitzgerald, Liam Joseph.
- Flynn, Pádraig.
- Foley, Denis.
- Gallagher, Denis.
- Gallagher, Pat Cope.
- Geoghegan-Quinn, Máire.
- Gregory-Independent, Tony.
- Harney, Mary.
- Haughey, Charles J.
- Hilliard, Colm.
- Hyland, Liam.
- Kirk, Séamus.
- Kitt, Michael.
- Leonard, Jimmy.
- Leonard, Tom.
- Leyden, Terry.
- McCarthy, Seán.
- McCreevy, Charlie.
- McEllistrim, Tom.
- Mac Giolla, Tomás.
- Ormonde, Donal.
- O'Rourke, Mary.
- Power, Paddy.
- Reynolds, Albert.
- Treacy, Noel.
- Tunney, Jim.
- Walsh, Joe.
- Walsh, Seán.
- Wilson, John P.
- Woods, Michael.
- Wyse, Pearse.
Tellers: Tá, Deputies Barrett(Dún Laoghaire) and Taylor; Níl, Deputies Vincent Brady and Barrett (Dublin North-West).
Question declared carried.
Motion, as amended, put and agreed to.