Vol. 7 No. 9
The motion which I ask the Seanad to consider reads:—
"That the Seanad considers it to be in the best interests of Saorstát Eireann that a Commission should be set up to inquire into the affairs of the National Land Bank and its relationship with the Industrial Trust Company of Ireland, and accordingly requests the Executive Council to set up such a Commission."
I take it that the Senator will have no objection, in the course of the debate, to my referring to his relations with the Bank that the motion deals with?
Sufficient for the day is the evil thereof. It has not arisen yet.
If anything of that sort turns up I am prepared to take all the responsibility. I am not going to introduce anything that is controversial. I think this motion need not be discussed if the Minister for Finance sees his way to set up a Committee or Commission to inquire into it. The Comptroller and Auditor-General has made a report which many members of this House have read but which some perhaps may not have read. The report states:—
A sum of £300,000 has been charged to this account, for an advance for the general purposes of the National Land Bank, Limited, including the making of advances in respect of loans under the Trade Loans (Guarantee) Act, 1924. Section 1 of this Act provides that where the proceeds of any loan proposed to be raised are to be applied towards or in connection with the carrying out of any capital undertaking, or in connection with the purchase of articles manufactured or produced in Saorstát Eireann required for the purposes of any such undertaking, and that the application of the loan in the manner proposed is calculated to promote employment in Saorstát Eireann, the Minister for Industry and Commerce with the consent of the Minister for Finance may guarantee the repayment of the principal of such loan and the payment of interest.
I observed that in one case a loan for a considerable sum had been guaranteed to enable a reconstructed company to acquire the premises, plant, machinery, etc., of a private limited company which had gone into voluntary liquidation. An application for the guarantee of a loan had already been made by the old company and had been refused and the voluntary liquidation was apparently entered into to enable the reconstructed company to qualify for a guarantee under the Act. The personnel of the new company was practically the same as that of the old company and from papers furnished to me it would appear that the security for the guaranteed loan was to be a second mortgage debenture charge on the assets, and that a prior charge was at the same time to be created as security for an advance from a bank to provide working capital.
In view of the limitations for guarantee of loans imposed by Section 1 of the Act I did not consider that the guarantee in this case came within its terms and I have deemed it necessary to call attention to it in my report.
That is the official report of the Comptroller and Auditor-General. I can see no reason why the Minister for Finance would not set up a Commission to inquire into the affairs of the Land Bank. In a statement he made a week ago in the Dáil he said:—
"I was appointed by the late General Collins, when the National Land Bank was started, as one of the directors of that bank, and I acted as a director until I became Minister for Finance. Since I became Minister for Finance I have not done anything in the way of touching the business of the bank. I have not attended meetings of the board of directors. I have received no information as to the business done at the boards—that is, no information as to private cases."
The Minister for Finance is a director of the bank, and by his own statement he did not consider it necessary to attend the meetings, or perform the ordinary duties of a director. The Minister went on:—
"I came to the Dáil and asked for an advance of £300,000 to enable certain of the loans actually to be made through the Land Bank. It is because other banks would not take up the loans that certain of them had to be made by the Land Bank.
"I have recognised for a very considerable time that the position of the Land Bank is anomalous. I have recognised that it is a State-owned bank which is not a State bank. It was formed to do a certain work at a time of stress; it was formed to prevent the national struggle being changed into a land war during 1919-1920. Since then it has simply been carrying on as a small bank on very much the same lines as other banks, with this difference, that as the Minister for Finance was the holder of the shares the directors were nominated by the Minister for Finance instead of being elected by a meeting of shareholders.
"When it was determined to set up a Banking Commission it was also determined that no change should be made in regard to the National Land Bank until the Banking Commission had reported. One of the things which the Banking Commission has been specifically asked to report upon is whether the National Land Bank should be continued as a State-owned bank, and, if continued, what functions should be assigned to it."
The Minister continued to say:
"If we are to carry on a bank like the Land Bank I do not see any possibility of doing it except by appointing somebody at a salary of, say, £2,500 a year, giving him something approaching judicial tenure and forbidding him to carry on any other functions. I think in no other way could we possibly carry on a State-owned bank, and, even with that, I believe difficulties and troubles would be encountered that do not exist in respect to ordinary banks."
The President yesterday asked to have a motion carried setting up a Commission and the House agreed. No better Commission could be set up for the purpose I am seeking than one selected by the Government. My resolution is that the Government should appoint a Commission to go into the affairs of the National Land Bank and its associations with the affairs of the Industrial Trust Company. We have before us the Interim Report from the Committee of Public Accounts and in face of that report I simply suggest that the Minister might see his way to set up this Commission for which I ask.
Certainly not! The Senator has not suggested the slightest reason for doing so, so far.
In his statement the other day the Minister mentioned and it is very desirable that we should all remember it, that we ought not to go into the private transactions of the Bank. To my mind it is most objectionable, and for that reason I thought, and I still think, that instead of opening up here a debate on transactions all of which may be perfectly simple, and which may be easily explained, they could be far more easily explained before the Commission than here with the Press present, taking down what is being said which may be accurate or may not be accurate. Even still I appeal to the Minister to consider the matter from that point of view. The Commission will be a Commission appointed by the Government; not one named by this House. It will be a Commission appointed by the Executive to make inquiries. I am introducing no heat into this matter. I am trying to keep everything like that out of it. I think the Minister might well consider the advisability of appointing this Commission to go into the affairs of the Bank. If they ask me to go before them I will be prepared to do so and I am certain that others will also be prepared to make a statement before them privately. No injury can be done to anyone; no injury can be done to the Government and no scandal brought out. There may be no scandal.
I again sincerely appeal to the Minister to consider the matter. I do not wish to rush him and I do not wish to go further into the matter without giving the Minister an opportunity of considering it. I think the Minister by agreeing to my request would serve everyone, would serve the country, and that there could be nothing injurious to him, to his position or to the Government, in having a detailed report on things which he says he has no knowledge of.
I am perfectly clear in my mind about this matter. I am entirely satisfied with the way the business of the Land Bank has been conducted. Before I would consent to setting up any commission of investigation some cause would have to be shown. The Senator has not attempted to show any cause but has confined himself to obscure hints.
Then, with the permission of the House, I have no option but to move the motion and to go into some of these transactions which have taken place.
I do not think you ought to be in any difficulty or have any hesitation in the matter. You put down this notice of motion. It has already formed the subject of discussion in the other House and, if you wish to recommend your motion to the Seanad, you are at full liberty to give your reasons: I think you are bound to give your reasons.
The Board of Directors of the Land Bank, as given up to 31st December last in a Balance Sheet issued on 12th January, 1926, consists of:—James G. Douglas (Chairman), Ernest Blythe, J.J. McElligott, L. Smith-Gordon, and J. Caffrey, Manager and Secretary. Mr. Blythe has stated that since he became Minister for Finance he has not attended meetings of the Board and that he has no internal knowledge of the affairs of the bank, with reference to private accounts.
Private accounts we all know are accounts of individuals or companies, either private companies or limited liability companies. They are not public accounts. Mr. Blythe says that Mr. MacElligott has been there simply to watch things on behalf of the Government. In the trading transactions of the bank some of the directors of it are, and have been, directors of other companies. This is the painful part to me, to have to mention the names of companies. I would like to refer to them as A., B., C. and D. if the House could understand the position.
As far as I am concerned you can use my name freely.
I do not understand why you should have any delicacy in this matter.
I have, sir.
You have put down this motion on your own responsibility. You either intended it seriously or you did not. If you think it is a serious matter—
I do.
Then you can speak with the greatest freedom.
The firm of MacLysaght and Douglas, Limited, has been formed in Dublin. The directors of the company at the start were Mr. MacLysaght, Mr. Douglas and Mr. Smith-Gordon. The capital of the company is £1,300. It was very shortly started when a company was promoted caller the Irish and Foreign Trading Company, Ltd. This company started with the nominal capital of £30,000, and the subscribed capital was £10,000. The first directors on the Board were Baron Ffrench, Mr. MacLysaght, Mr. Douglas, and Mr. Smith-Gordon. The Land Bank at the inauguration of that company subscribed £4,900 of the capital; Baron Ffrench, £3,600; Mr. MacLysaght, £649; Mr. Douglas, £649; Mr. Percy H. Brown, London, £100, and Mr. Smith-Gordon, £100. We have two directors of the Land Bank directors of this new trading company, and using the money of the Land Bank to the exposed extent of £4,900 towards the promotion of a trading company. I hold and I ask the House to hold that that is not a banking transaction. Banking transactions, as far as I can judge, are for companies, for firms or for individuals carrying on business for some time. A bank may see its way sometimes to give too much credit. Sometimes we think it does not give us enough. At all events the bank uses its best judgment, but I have not yet met a case where a bank is a promoter of a company to this extent: that two of the directors are directors of the new company and the money of the bank is advanced to that new company. The question I cannot solve is: what are the assets of the Irish and Foreign Trading Company at the present moment?
What is the position of the Land Bank? That is a question which would be inquired into by the Commission that I suggested. At any rate, I put it to the House that when this company was formed the Land Bank was the absolute subscriber in the first instance of this £4,900. Mr. MacLysaght and Mr. Douglas, in their subscriptions to the capital of this new company, contributed in shares of MacLysaght, Douglas and Company, Ltd. Mr. MacLysaght put up 649 shares and Mr. Douglas put up 649 shares. The Land Bank put up cash. Mr. Smith-Gordon is supposed to have put up cash. At all events, there is the fact that on the 3rd August, 1923, 1,298 £ preference shares allotted to J.G. Douglas and E. MacLysaght are exchanged for 1,298 ordinary shares in MacLysaght and Douglas. There was here an exchange transaction in shares, and I think it will be found that these shares were since returned, but I do not know on what terms. I am speaking now of transactions where two directors of the Land Bank became directors of a new company. A little later on, the 18th August, 1923, a company was formed in Dublin called Peugeot, Limited. Two of the directors were Mr. Phibbs and Mr. Smith-Gordon, and the capital of the company was £1,000. Very shortly afterwards there was a debenture mortgage to the Land Bank for £24,000. Now I think it would not be held to be good practical business for a bank to advance money to a new company started in August, 1923, immediately, to the extent of £24,000. We find a mortgage for £24,263 in the last statement of affairs and the amount due as £21,011 18s. 4d. Peugeot is a small company of £1,000 capital, and the Peugeot Car Company, so far as I can gather, is at present represented in Dublin by Messrs. MacLysaght and Douglas, with a manager. I omitted to state that in the Irish and Foreign Trading Company the address of the secretary of the company, Mr. Walter Douglas, is changed from Eden Quay to Dawson Street, where the business of MacLysaght and Company is also conducted, as well as the Peugeot Car Company, and I presume the Irish and Foreign Trading Company.
Would the Senator mind speaking up? We cannot hear him on this side of the House at all.
Over 900 shares held by Mr. Phibbs were transferred to the Land Bank, since when I presume his connection has entirely ceased with the company, which is now being carried on by Mr. Smith-Gordon and Miss Carmichael, as secretary. The question of Alesbury Bros has been dealt with by the Auditor-General in a report submitted by him to the Committee of Public Accounts. You have got the report before you and I wish to call your attention to one little point in this report:—
"It is necessary for a correct understanding of the case under review to point out that the amount of the guaranteed loan made by the National Land Bank was practically identical with the amount required for the purchase of the claim of the other bank against the Company. It would, therefore, appear that the net effect of the purchase was to place the Company in a position to raise the required working capital from the bank on the security of a first mortgage debenture, leaving as security for the State guaranteed loan a second mortgage debenture."
In other words, the report of the Auditor-General is that an application was made to the Industrial Trust Co., or at least to the Minister for Finance and his Department for an advance of £28,500. That was refused and the company then went into liquidation, the Land Bank taking up the mortgage of £28,500 as a second mortgage. In the first instance they could have got the whole thing for £28,500. They come in now as second mortgagees, with a £10,000 mortgage in front of them. That is the statement of the Auditor-General, and the statement of the Committee of Public Accounts—at least it is my interpretation of the statement. The Auditor-General reports on the transaction as being —well, a twisted one, and his report is before you. I am speaking to an assembly which does not require explanations in these matters, and I do not want to labour the point.
Would you pardon me for a moment? I think it would help the House very much to clear up this. I am trying to follow you as carefully as I can, but I am in a difficulty. Is it your complaint that this proceeding was an irregular one?
Absolutely.
But is that all it comes to? Is that the full amount of it? Your suggestion is that it was not a proper business transaction. Is that it?
I make no suggestion. I call attention to the facts. I do not suggest. The Auditor-General calls attention to the facts, and I am calling your attention to what he says.
What I want to point out to you is that the Auditor-General's criticism has been before the Committee, and the Committee has made a report on it, and that is the document.
Yes. That is the report of the Committee. I look first to the fountain head. We have an Auditor-General who audits accounts, and I think we must accept his reports.
I am not criticising his report or your statement on it. What I have in mind is if that matter had been investigated——
By whom?
By the Committee of Public Accounts.
I have not read the whole report. I know that you, sir, can take out the points of it in two or three seconds which I could not do in half a year, and I know that other members of the House have a great deal more intelligence than I have. I do not want to waste time.
I do not want to curtail you for a moment. I only want to make your point clear to the House. You are assuming that the House is familiar with this report of the Committee of Pubilc Accounts, but I do not think it is. It was only printed yesterday.
That is so. The Auditor-General's report has been in the hands of the Senators longer.
With your leave, sir, I would like to put one question to the Senator. Would he point out where, in the Auditor-General's report, or in the report of the Committee of Public Accounts, there is any criticism of the National Land Bank, or of any part it has played in this transaction?
The Minister has put a definite question with reference to the Land Bank. I do not know what control the Minister has over the Land Bank, but I know what the Land Bank ought to be, and I know what any bank ought to be. I have read for you the report of the Auditor-General, and he, without any hesitation, as we can read between the lines, puts it there that this matter wants investigation. In other words, by a subterfuge —by getting two opinions from the Attorney-General, the first opinion being that the money could not be advanced—you turn the company into liquidation, and you advance the money on £10,000 worse terms than at first. That is what the Auditor-General charges here, that you have taken a second mortgage where you could have got a first.
That is a criticism of me and not of the Land Bank.
I do not know who handles the money. You do not handle it. If there is one person in the world who would not wish to criticise you unfairly I am that person, for I look upon you as one of the greatest statesmen we have.
I give in.
I think the Government have done in a short time more than we could expect in a century. I say that the Minister has done something—he has turned waste into use. Ever since God made Galway Bay the Shannon has been running to waste, and he is turning that waste into a source of utility.
To come back to your motion, I really want to help you as far as I can to get the issue before us. Am I right in assuming that the Auditor-General in his report says in so far as the Land Bank is concerned that in making this advance he was of opinion the guarantee they received did not come within its terms?
I think so, sir. Then they made an advance on a guarantee they should not have accepted.
And his view was that that did not come within the terms of the Act?
I must let every Senator interpret what his views on this question are. I say if I go to a bank it will not lend me money except the guarantees are right. This reference now is a rather complicated one, and I will ask you to bear with me slightly. There was a company formed, the Kilteragh Estates, Ltd., and the original shareholders of this company happened to be Mr. Lionel Smith-Gordon, Mr. Becket, and Sir Horace Plunkett. When this company was formed it was incorporated on the 7th January, 1924. Mr. Smith Gordon was supposed to have 1,000 £ shares in the company and he is a director of the National Land Bank. This is a private company, and advances were made to this estate quite lately of £12,000. The advance is made nominally through the Industrial Trust Company. Mr. Smith-Gordon is a director of the Kilteragh Estates, Ltd., and also a director of the National Land Bank and he has recently, I understand, become managing director of the Industrial Trust Company. The things run so far into each other, there is so much inter-directorship, that I thought this matter would require people to go into it quietly and to investigate discussion in a way that no individual like myself could do.
I make no reference at all to the discussion in the other House, in which Mr. Blythe replied with reference to John Douglas and Company. That, to my view, is a private banking transaction. I made no reference to it, and I do not think there should be any reference made to it. But, reference having been made to it in the other House, I want to say that I always thought it was a real banking transaction. I have nothing to say to it, good, bad or indifferent. But when the Land Bank has put Mr. Smith-Gordon on the Board, whether in these companies or in the Irish and Foreign Trading Company, I think then these are things that really should bear a good deal of investigation, and it is for that reason that I submit my motion to the Seanad.
I second the motion. The subject of this motion has been a matter of discussion for a very considerable time—for the past two months. I have heard it mentioned several times, but, as it was a mere matter of rumour, I paid no attention to it, and declined to have any discussion on the point. Since then it has come more prominently under my notice, first by discussion in the newspapers on this matter, and, secondly, in the Dáil. I therefore think it is in the interests of those who have been named, those whose names have been mentioned publicly, that they should have an opportunity of discussing the matter fully and going into the whole case as fully as they consider necessary. That is practically the reason that I am moving in this matter. If this matter were merely discussed cursorily and passed over, there is no doubt people in the country would take it up and discuss it and imply all sorts of motives that would be quite untrue and quite improper, and they would come to the conclusion that the matter had been hushed up in some way. That impression would remain on their minds.
Now on this matter I have no personal or party feelings. It involves the names of certain persons who have been looked on by all certainly by me as very honourable men. The Land Bank was created during the Anglo-Irish trouble in order to settle the land question, or to help to settle the land question, which had been troubling Ireland for a great number of years. I thought at the time it was being set up that it was a very unwise method to apply, especially under the circumstances, and I ventured to tell one of the directors at the time my views on the matter. I told him that I remembered a very similar circumstance when Mr. Parnell raised money by subscriptions all over the country to buy up estates to sell to the tenants. There was great enthusiasm created by the prospect that the land was to be bought up and divided. However, it resulted most disastrously. Very large sums were applied to the purpose. The prices of the estates were much too high at the time, and eventually it ended in loss to everybody concerned and in no great credit to the parties who started it.
I pointed out that the circumstances that arose at that time were somewhat similar, but more likely to be disastrous than on the former occasion, because, during the war, land had reached a very high figure, and people were rushing in to buy the land at any price. I have no reason to change my opinion on that matter, because prices have fallen so greatly that I believe the sums lent by the Land Bank cannot possibly be recovered from the tenants at the present moment. I have not full information on the matter, but that is my belief. There is, however, a difference in the case, inasmuch as the State has stepped in to help. I do not want to have too much criticism of what happened, because the circumstances were peculiar. Things do not turn out always as people hope and wish. No doubt the people who started the Land Bank did it with the very best intentions, and we may acquit them of any mistakes they made at the time. But I expect there will be some difficulty in settling this question of the purchase of estates. The matter will have to be settled somehow.
That seems to be the first effort of the Land Bank. The Minister for Finance had, later on, to add a sum of £300,000 for the purpose of changing the Bank more or less from dealing with the particular land question to the improvement of the industries of the country—a very reasonable and sensible thing as far as I can see. Of course the question arises, when the State begins to interfere in these matters how is it to direct affairs? The Minister for Finance explained in the other House that he appointed certain directors as representatives of the Ministry to see that the country's interests were not damaged. That also was a wise method. It could not be questioned for a moment if this thing were to be done at all.
I have no insinuation or allegation to make of dishonesty on the part of anybody—on the part of the Minister or on the part of those who were appointed directors or anybody else. I do not wish to do anything of the sort. I want to clear myself of any imputation of any such thing in this matter. Names have been mentioned. It was necessary to mention names. Some of the people mentioned are not here. I prefer not to mention the names of people who are not here to defend themselves, but I cannot keep them out of it. Senator Douglas, whose name has been mentioned, is here and he is a great deal better able to defend himself than I am to make any case against him. He was asked by the Minister to represent the Ministry of Finance on the Land Bank. The Minister stated that, and I presume that was correct, and Senator Douglas accepted the position. Still I think one ought to consider in general terms what ought to be the action of the person appointed in that way. I think we could lay down as an axiom that the person occupying the position of representative of the Government in the matter ought, as a matter of public propriety and in the interests of his own honour, to keep his personal business aloof from the public interests.
That has always, been regarded as the correct thing in national affairs and in private life. A trustee in matters in which he is concerned is not permitted to use the Trust funds in any matter connected with his own business. This principle does not include railways and public undertakings, but it does include shops and private business. Now I want to quote again, because it has been already quoted, the statement of the Auditor-General. The Minister challenges that statement. I will only quote the last two or three lines. The Minister interprets it in quite a different way from what I do. It seems to blame the transaction on the Bank. At the end of his report the Auditor-General says: "In view of the limitations for guarantee of loans imposed by Section 1 of the Act I did not consider that the guarantee in this case came within its terms, and I have deemed it necessary to call attention to it in my report." It seems to me that the Auditor-General says that the Bank had exceeded its functions.
That the Bank has?
Yes, the Bank could lend.
Could the Senator point out where the Bank is mentioned in an adverse way?
The heading is "Vote 65—National Land Bank, Limited," and it proceeds to say that a sum of £300,000 has been charged to this account for an advance for the general purposes of the National Land Bank, Limited, and he gives one paragraph to explain what the Trade Loans (Guarantee) Act, 1924, could permit and then he goes on to say what the Land Bank did under that Act——
The Land Bank has very little to do under that Act. If there is any criticism in that report it is criticism of myself and of the Attorney-General. There is no criticism of the National Land Bank. I will ask the Senator to agree to that.
I cannot accept that.
I would like to be shown where there is adverse criticism of the Land Bank shown in that report.
I think I have read it.
Show me any adverse criticism.
The Land Bank advances certain sums of money for people who are not mentioned here. Is not that so?
Yes.
And no doubt it had to accept the approval of the Minister.
Not at all.
Accept the approval of the Minister for Finance afterwards. The Minister for Finance says that he does not go there, but that he has a representative there and the representative apparently agreed to the advance and the Auditor-General says it was wrong.
The Attorney-General says it was right.
The Auditor-General does not agree with him. That is all I say. I doubt how you are to interpret his criticism. I go by the Auditor-General here, and I also go by the statement made by the Committee of Public Accounts.
What is confusing Senator Moore is he does not distinguish between guarantee and advance. The Auditor-General was dealing solely with guarantee. He said the guarantee was not within the Act. He was not dealing with the National Land Bank at all. The National Land Bank could give an advance to anybody, but it does not come within the purview of the Auditor-General at all.
The Land Bank gave these advances because it had £300,000 of Government money to lend and the guarantee was not sufficient for the purpose according to the Auditor-General. However, you can pass from that. It is quite clear there are so many companies, so many guarantees, and so many other things that it is hard to understand it, but perhaps the Minister would explain it.
I am afraid it is hopeless to try to explain it to the Senator.
Quite. Now we come to the point of Senator Douglas. Senator Douglas was appointed as the representative of the Government on that bank. The Minister has explained in the Dáil the whole state of that case: that the Ulster Bank lent a certain sum of money to a business partly connected with Senator Douglas, and that the Land Bank took that over and later on the money being still owing the business was turned into a limited company and the money was used to finance it on that occasion. I daresay I am quite sure there was no misappropriation of money in that case, or anything of the sort, but still I do think, when Senator Douglas was appointed representative of the Government on that bank, that he ought to have considered whether he ought accept the appointment on a bank with which he was financially connected. I do not think there was any dishonesty about that, but it was a very unwise proceeding for Senator Douglas to put himself in that position. He ought have said to himself, "I am connected with the bank in many ways and they ought to find somebody else."
There are a number of other matters in which Senator Douglas's name appears and which have been already mentioned. There is the Peugeot Company and other companies, and the matter is very much confused. I do not want to go into all the details, but the same rule of conduct seems to apply, and a wise person would apply it, and it is this, that whoever was appointed to represent the Ministry ought have one or two or three shares or whatever was necessary to qualify him as a member of the Board; but, as representative of the Government and dealing with the National Land Bank, he ought to have only the one or two or three shares necessary to qualify him self for a directorship. It would not be wise if he did otherwise. Senator Douglas would be able to say himself if he had speculations, and if afterwards it happened in these different things that he found he did an unwise act. I would not, by any means, say it was an improper or dishonest act, but still it was an unwise act. I think he should confine himself to the one point. Now I have explained why I think the National Land Bank has not acted in this matter very wisely. I think, on the land question, that bank did not act very wisely. I admit there were reasons for that. Then I think, if the Land Bank did advance this money, evidently in one case very wrongly, it exceeded its powers and a mistake was made. But there are numbers of other things which require an explanation, and I will not go further than that. Undoubtedly Senator Douglas will be able to explain these matters fully. The persons appointed by the Government to look after the affairs of the country would be wiser if they did not mix up their own private affairs with those of the bank that they were expected to look after.
I should like to say at once that I very much welcome, and to this extent agree with Senator Moore, that an opportunity has been given to me to-day of dealing in public with my relations towards the National Land Bank and the Industrial Trust Company. Senator Moore says I ought to be given an opportunity. With that I agree. However, before he made his own insinuations he ought to have waited until he heard my statement. I let that pass.
I seconded the motion.
Whatever object the Senator who introduced this motion had in coming into the open in this matter I do not know, but he certainly has given me an opportunity of answering the slanders which he and others have spread amongst members of this House and elsewhere which could not be justified and which were calculated to injure me and others. Before dealing with the matters referred to in the Senator's speech I should like to say that I feel I am entitled also to refer to the statement made by Deputy Heffernan because I am concerned also in the statement made by him. I may say in passing that I believe he spoke in perfectly good faith. I do not question that but I propose to deal jointly with the speech made by Senator Fitzgerald and the references made in the Dáil by Deputy Heffernan. I want to tell the House quite frankly not only what is behind this motion, which is relatively unimportant, but behind the slanders generally which have gone on for a considerable time.
On a point of order, rather serious statements have been made that I have been guilty of slanders and I hope that some details about the slanders will be given because I think when a Senator gets up in this House and says that I have issued slanders about him he should explain them. He also coupled my name with that of Deputy Heffernan whom I have never met and about whom I know nothing.
I think I am entitled to go through what I have got to say in view of the statements made here and elsewhere. Certainly I will give the Senator as much detail as he wants. I ask that as aspersions have been made on my character I should be allowed to state fully and freely what I believe to be the truth with the minimum of interruption.
It is quite plain that you regard those statements, references, rumours or paragraphs as involving a grave imputation on your commercial integrity and personal honour and therefore, so far as I can secure it, I will secure to you a free and unlimited reply in the discussion of the matter.
Thank you. Before going into the details of the various charges, which I propose to do, I want to tell the Seanad quite frankly what I believe is behind the motion and what is the cause of the slanders as far as I am concerned. There is a universally recognised rule, which is scrupulously honoured in this country, that directors and officials of banks and other financial organisations shall regard, as strictly secret, their relations with their clients and persons who may offer business to them. This secrecy which I have felt myself bound in honour to observe in connection with the business of the National Land Bank has made it very difficult for me to meet the various slanderous suggestions which have been spread round the Senate and which, according to Deputy Heffernan, have also been the subject of discussion amongst members of the Dáil. As a bank director I have, of course, knowledge of the affairs of the bank's customers which include members of both the Dáil and the Senate and I feel sure they all know that such knowledge never has been disclosed by me. There is, however, a point at which even a bank director must be allowed to disclose information in defence of himself. I have consulted the Cathaoirleach and several other Senators and I have consulted some directors of other banks and they all agree that as Senator Fitzgerald has attacked the National Land Bank I must be at liberty to state in public the relations between the Senator and the bank. I do not propose to give actual details unless the Senator permits me to do so, but I can easily state the facts without involving any other person than Senator Fitzgerald.
About two years ago Senator Fitzgerald approached the Minister for Finance and asked the Minister to use his influence to get the bank to take over the business of a company in which Senator Fitzgerald had a controlling interest and which was being pressed by its bankers to reduce its overdraft, an overdraft which had been personally guaranteed by the Senator. Mr. Blythe replied that he took no part in the ordinary business of the bank and suggested that Senator Fitzgerald should see me with a view to a proposition being placed before the directors. Senator Fitzgerald spoke to me and I asked to see a certified balance sheet and it was arranged that I should meet the manager of the company.
Have you got the date of that?
I did so, and discovered that an overdraft of up to £350,000 would be required, the only security being the assets I estimated as value for perhaps £50,000 and a personal guarantee of Senator Fitzgerald. I immediately stated that the proposal was too absurd even to place before the board of the bank. I was told that the Government wanted the bank to do the business and I stated I did not believe this for a moment. I was afterwards told by Mr. Blythe that there was not a word of truth in this statement. As a matter of fact I did bring the matter before the board of the bank and they of course confirmed my action. At a later date the company was liquidated and it transpired that had the bank undertaken the business desired by Senator Fitzgerald it would have lost over £300,000, the assets which I thought worth £50,000 only realising £47,000 in all.
This, a Chathaoirligh, is, I am absolutely certain, the direct cause and explanation of all these rumours and attacks on the National Land Bank, and more particularly on myself. I suggest, with a full sense of responsibility, that these attacks are due, not to any improper action on the part of the directors, but to the fact that the directors refused to squander away the assets of the bank in the interests of Senator Fitzgerald. Ever since this incident I have been subject to venomous slanders spread by him and another Senator, who is an employee of his. Many members of this House know this is true—they know it has gone on for a long time, and they know it was especially vigorous in or about December last. The Industrial Trust Company is mentioned, and it is suggested that it has acted improperly in connection with the National Land Bank. Senators will remember an extraordinary outburst in this House by Senator Fitzgerald showing his hostility to the company before it had even commenced business. The House is aware that the Senator has shown marked hostility to myself on every possible occasion ever since his proposal, which I have outlined, was rejected.
Until quite recently I ignored Senator Fitzgerald's slanders, as I felt I could place my reputation against his without fear, and that people who believed in him and in his methods were not the kind of people whose good-will I desired. However, the slanders began to take a different shape, and a small paper published weekly began to repeat them, at first more by veiled suggestions rather than by direct statements, and these culminated in the article referred to by Deputy Heffernan in the Dáil which, while pretending to admit that the directors of the National Land Bank and the Industrial Trust Company were honest men, nevertheless practically accused them of having used their positions improperly to further their personal interests. Before deal ing with the statements made in this article, I wish to give certain particulars as to the paper which published them.
The paper is published by a registered limited company, with nominal capital of £500, of which only 250 £1 shares have been issued—249 of these shares are in the name of the editor. From inquiries I have made I understand the circulation is very small, and that the paper cannot possibly be run without loss, as the advertisements would not pay the cost. One of the advertisers told me that he put in the advertisement when the paper started because he was asked to help the editor, and another advertiser told me that he paid for one insertion only, but his advertisement was kept in free for months after to fill up space. It is clear that the paper is being financed by someone who is afraid or ashamed to let his name be known by purchasing shares. The editor pretends he can be sued for libel if his statements are untrue. I ask this House what chance there would be of getting costs, much less damages, if a libel action was won against a company with £250 capital? Only a wealthy man could take an action under these circumstances. Will Senator Fitzgerald deny that he has supplied funds for the upkeep of the paper to which I refer?
Would you take a suggestion from me not to make personal appeals to the Senator, because they necessarily involve recriminations?
The Senator does not reply. In any case it is obvious that the misrepresentations made in the paper are just the same kind as those spread by Senator Fitzgerald and his friends—they are more subtle, perhaps, but they have just the same unfair suggestions and just the same bias against myself and against the bank which refused Senator Fitzgerald's business. Surely it is not mere coincidence that this motion was handed in the day before the publication of the article referred to by Deputy Heffernan? It is not mere coincidence that the editor of this paper was able to tell a friend of mine the reasons why the motion was being temporarily postponed. Whatever the connection be between Senator Fitzgerald and Captain Harrison, the editor, I am convinced, and I ask this House to believe, that they have consulted together, and that they are both animated with animus against the Land Bank and with a desire to injure me personally, and if possible drive me out of public life. I ask the House to believe, and I am convinced of it, that the suggestion in this article referred to by Deputy Heffernan, and the suggestions made by Senator Fitzgerald are one and the same, because they emanate from the same source.
I think I have probably given this House enough information to enable them to deal with this motion, but as I have evidence that these slanders and statements have led honest persons to believe there is truth in them, and have misled perfectly honest people, and as I have nothing to hide, I propose to give the facts with reference to the various sources which have been mentioned by the Senator and which were mentioned in this particular article to which reference has been made.
The method adopted in this paper was to string together a number of half truths in such a way as to suggest that the directors of the National Land Bank and of the Industrial Trust Company are using their positions improperly to obtain loans for companies in which they are personally interested. Let me say at once that there is no truth whatever in these suggestions. As far as I am concerned I have nothing to hide. I would welcome an inquiry by any person with business or banking experience into every transaction I have had with the National Land Bank or the Industrial Trust Company. As a matter of fact, the Minister for Finance has an independent representative on the board of the bank, who can and does inquire into matters of this kind, and he has knowledge of all its affairs. References have been made to two companies in which I have a personal interest, both of which keep their accounts in the National Land Bank. Both of these firms had their accounts with the bank before I became a director, and neither of them has received any facilities from the bank which they did not have before I joined the board.
In the case of John Douglas & Sons, which Senator Fitzgerald admits is an ordinary business transaction and in which he does not confirm the suggestion of the paper with which I believe he has some connection, this company had its account with another bank. In 1921 I moved the account to the National Land Bank, having been requested to do so by the late Mr. Erskine Childers, Mr. James McNeill, and Mr. Blythe, all of whom were personal friends of mine. The facilities then given were exactly the same as those given by the previous Bank, and there was no change whatever in the facilities from those which the firm got from the previous Bank. Senator Colonel Moore thinks I might have moved the account. I did mention the matter to the Board, but it was pointed out that the National Land Bank was being treated with some suspicion and that if I had moved the account it would have been taken by people to mean that I had no confidence in the Bank.
It is a well-known fact in banking transactions that if a director has any personal dealings with the Bank, he is bound to disclose his interests and let the other directors deal with them, and a minute is always made accordingly. Actually, this question did not arise because no additional facilities of any kind were given in the case of either of these accounts. It was not particularly easy at the time my firm's account was moved to the National Land Bank to get firms to transfer to a new Bank which was known to be financed by the Dáil, and I think it is very hard and unfair that statements imputing an improper motive to my action should be made at this time. There were many persons who boasted of their patriotism at the time who never did anything whatever to assist the Bank in any way.
I want to state that these facts about my firm were known to Captain Harrison when he wrote the article. He knew it was a private company; he knew that it had its account previously with another Bank; he knew that no additional facilities had been given. How do I know this? Because Senator Brown has given me leave to say that he explained the exact position to him. Why were these matters introduced in the article? I leave Senators to draw their own conclusions. Neither of the two firms with which I was personally connected had anything to do with the Industrial Trust Company. Neither of them had applied for or obtained a Trade Loan guarantee nor had they anything whatever to do with the supposed object of the article referred to by Deputy Heffernan.
With regard to the firms of McLysaght and Douglas, Ltd., and Peugeot Cars, Ltd., these are private firms. There is no reason why, even in the case of a State bank, the private affairs of these firms should be disclosed in this House, but as I have the assent of the other persons interested, and as I have nothing whatever to hide, I propose to give the facts. They are as follows:—Peugeot Cars was in the first place a private firm which did business with the National Land Bank and it opened an account before I became a director. No person connected with the bank had any interest whatever in the firm. As a result of circumstances entirely outside the bank's control it became necessary to reorganise it as a limited company. The bank considered it essential to be represented in the control of the company to protect their own interests and Mr. Smith-Gordon was asked by the board to act as its representative, which he did for three years without financial interest or even a director's fee. Recently when the managing director of the business decided to retire the bank were in the position that they had to find a person to control the business until the indebtedness to themselves should be completely liquidated. Mr. Smith-Gordon having at that time ceased to be an official of the bank offered to take over control of the business and to pay in all profits to the bank and the directors of the bank unanimously accepted this offer. The Minister and his representatives were fully cognisant of all the facts.
In regard to McLysaght and Douglas I have already explained that this was a company in which the shares were owned by ex-Senator McLysaght and myself before I had any connection with the National Land Bank and its account was kept at that bank as an ordinary matter of business. Mr. Smith-Gordon was allotted one share in the company in order that he might advise us from time to time and he has no other interest in the firm. The present arrangement between Peugeot Cars, Limited, and McLysaght and Douglas is merely one of joint working in regard to sales and service by which a large economy in overhead expenses is effected for both companies. Neither company has any advance under the Trade Loans (Guarantee) Act, nor any connection with the Industrial Trust Company and the businesses in question are purely private ones, the affairs of which I should not dream of discussing in public if they had not been brought into these attacks.
With regard to the Irish and Foreign Trading Corporation I make the Senator a present, if he likes, of the argument that the connection of the Bank with this company was an error of judgment on the part of the Bank. If it was, it was done before any of the present directors were on the Board. The company was not making a profit and the directors decided not to continue it. They asked McLysaght and Douglas to liquidate the assets. Neither I, Mr. McLysaght nor Mr. Smith-Gordon received a penny for the service given. Our connection with the work for this Corporation was solely in the interests of the Bank. The company paid all its debts and therefore was not formally liquidated. It was thought possible it might be sold afterwards to some other concern that wanted to avoid the necessary fees. There again I say there is nothing to hide, and nothing which I would not show willingly to any trustworthy person of business or banking experience.
Let me say definitely that there is no connection whatever between the National Land Bank and the Industrial Trust Company except that the Bank acts as bankers to the latter. Seven out of the nine banks operating in the Saorstát at present hold shares in the Trust Company, but the National Land Bank is not one of those seven. There has been a lot of talk both by the Senator and in the article to which I refer of multiplicity of functions and it is clearly suggested that I have improperly obtained directorships from these companies. Except for acting in an unpaid capacity on the Board of the Irish and Foreign Trading Corporation which, as I have mentioned before, was before I became a director, I have not obtained a single directorship from the National Land Bank, and I have not been appointed a director of any company by the Industrial Trust Company. These statements can be verified. No company in which I had any interest whatever at the time has asked or obtained a Government guarantee under the Trade Loans (Guarantee) Act.
Even if I had represented the Industrial Trust Company on some of the companies in which it holds debentures, I hold it would have been perfectly proper for me to do so provided I was not otherwise interested in the company. The Trust Company in the future may possibly find it essential to its interest to appoint directors on borrowing companies to hold a watching brief on its behalf. This, I maintain, would be a perfectly proper proceeding and I note that even Captain Harrison admits that this is so well understood in practice, that the difficulty of conflicting obligations does not arise in such a case. But as a matter of fact I do not hold any such directorship on behalf of the Industrial Trust Company or the National Land Bank. It is true that in one case I was appointed a director, not by the National Land Bank or the Industrial Trust Company, but at the express request of the Minister for Industry and Commerce to watch his interests. This was in the case of Messrs. Alesbury and I do not hold, nor did I at any time hold, any shares nor have I any other interest in this firm. The reference to this firm by Captain Harrison is both inaccurate and misleading. The references by Senator Fitzgerald and Senator Colonel Moore are also misleading. They say that the Comptroller and Auditor-General commented upon a transaction of the National Land Bank in regard to which the sanction of the Minister for Finance was declared to have been given. That is a clear misrepresentation, whether deliberate or not. The Comptroller and Auditor-General did not criticise the National Land Bank. Let me state the exact facts: The National Land Bank was asked to take over the account of Messrs. Alesbury before the firm was reconstructed and it refused to do so. A new firm was formed with provisions for the nomination of outside directors so that the Alesbury interest would be subordinate to that of the debenture holders. Senator Fitzgerald's statement is grossly untrue.
I beg your pardon. I simply read the Comptroller and Auditor-General's statement. I made no statement myself.
The statement is untrue, nevertheless. A new firm was formed, let me repeat, with provisions for the nomination of outside directors, so that the Alesbury interest would be subordinate to that of the debenture holders, and this company obtained a Trade Loan guarantee from the Minister for Industry and Commerce with the sanction of the Minister for Finance. In these transactions the Land Bank had no part whatever. The bank was then asked to provide the money under the guarantee, and it again declined on the grounds that its resources would not enable it to make long term loans of this character. That was the same attitude taken up by the other banks, I may say in passing. The Government then, with the assent of the Dáil, made a deposit of funds with the bank to enable it to take up this and other long term loans, which the bank, of course, then agreed to do. The Comptroller and Auditor-General, I understand, has questioned the legality of the action of the Minister in giving a guarantee, and disagrees with the Attorney-General in the question of law involved. But even if the Comptroller and Auditor-General be right, and the Attorney-General wrong, there is no reflection whatever on the Land Bank, which was bound to accept the Minister's guarantee, and could not be expected, nor was it in any way bound, to question the legality of this written guarantee.
Having dealt with the more or less specific attacks on myself, I want to refer shortly to Mr. Smith-Gordon. The suggestions in regard to his position are most unfair. Mr. Smith-Gordon was Managing Director of the National Land Bank until the end of last year, when he was appointed Managing Director of the Industrial Trust Company by the directors. He is an employee of the Trust Company, and can be removed by the directors at any time. In three cases he was asked to act as a director of borrowing companies by the Industrial Trust Company to safeguard their interests, and in none of these cases has he any other personal interest in the concern. If he ceased to be Managing Director of the Trust Company he would automatically cease to act for it in the matter of these directorships, and his position is perfectly well understood. I have made inquiries, and I find he is not in any other way interested in any firm which has obtained a Trade Loan guarantee. When he was Managing Director to the National Land Bank he willingly gave his services from time to time to the Government in many ways, and it is very hard, in my opinion, that he should now be subjected to these attacks.
Perhaps the meanest of all Captain Harrison's writings are his references to the Kilteragh Development Company. It is well known that this company is endeavouring to develop the estate of Sir Horace Plunkett, and it is equally well known that Mr. Smith-Gordon represents Sir Horace in the company. The company has not and did not apply for a Trade Loan guarantee and the ordinary loan it obtained from the Industrial Trust Company was amply secured. Captain Harrison was associated with Sir Horace Plunkett before the Treaty, and the fact that he would now stoop to make unfair references to the development of his estate gives us considerable insight into his mentality.
I would like to remind this House that the directors of the Industrial Trust Company are men of exceptionally good standing in this country. They have made their position by their ability and integrity and they would not for one moment sanction any dishonest or improper dealings.
Mr. Telford and Mr. John Mackie, of Craig Gardner's; Dr. Lombard Murphy and Mr. Hugh Kennedy are all men highly respected, and as for myself, while I do not claim the same business standing as these gentlemen, I am not ashamed of my record and I believe it will not be permanently injured by the slanders of Senator Fitzgerald or his employees and friends.
I confess I found it hard to believe that Captain Harrison would associate himself with Senator Fitzgerald, but it is clearly proved that he has joined in attempts to slander and has published statements calculated to injure individuals when in his own words he has "no knowledge of the merits underlying" what he calls his "facts."
Before I conclude, I ask particularly to refer to the position of Mr. McElligott. He is a civil servant, and it is as an official of the Ministry of Finance that he acts on the Board of the Land Bank. He receives no remuneration whatever for this and for the other services which are expected from him, and as a civil servant he cannot reply to these attacks. I say deliberately that it is nothing short of a scandal that he should be attacked in this way, and if Captain Harrison had any sense of public responsibility or decency he would not attack civil servants who cannot reply.
I have made no reference to the implied attacks on the Minister for Finance—he is well able to look after himself—but I may point out again that while as Minister he controls the policy of the bank, and has personal knowledge of all matters relating to the Government, such as guarantees, he does not personally act on the Board and has no knowledge of any intimate personal affairs which come before the Bank, with the exception of the case of Senator Fitzgerald, who went directly to him about the business he proposed.
There is an attempt in one of the articles to drag in the Banking Commission and it is said that I have been busying myself with the work of the Commission. If this means that I have been interfering with the Commission or that I have interested myself in it any more than any other bank director it is an absolute falsehood.
Senator Colonel Moore referred to the land transactions of the National Land Bank. I think I ought to refer to these. I may say I had no connection whatever with the bank at the time and I have no detailed knowledge of the circumstances. The first Dáil started the National Land Bank and it was its policy to advance money on certain land mortgages, and it so instructed the bank. Mr. Smith-Gordon and Mr. Caffrey as men of experience pointed out that they could not make loans on land at a time such as that without certain loss. The first Dáil recognised this and accordingly voted a special reserve to meet the loss. That reserve proved ample for the purpose. The land mortgages have all been dealt with and do not now appear on the accounts of the bank. It is, of course, well known to Senator Colonel Moore that practically all of these were taken over by the Land Commission under the Land Act. He was a member of this House when the Act was being considered. No doubt he has knowledge that there is a section dealing with the matter.
I have not referred here to the future of the National Land Bank. In this motion there is a clear and implied reference to it. The Minister for Finance has already referred to this in his speech in the Dáil. I would be quite ready to discuss it if and when the time comes and all I would like to say now is that there is no difference of opinion between the Government and the present directors as to its future. The bank has had a successful career; it is now doing a good business and I have no fear whatever for its future. I think it necessary to make this statement lest the customers of the bank may be rendered uneasy by the rumours which are being circulated. I would like to pay a personal tribute to the officials of this bank, especially to Mr. Smith-Gordon and Mr. T. Caffrey. They are both men of the highest honour and integrity and to have built up the bank and brought it to its present position has meant real ability and hard work.
The Ministers for Finance and Industry and Commerce are present. There is scarcely a statement which I have made of which either one or the other of them has not personal knowledge and I trust they will see their way to confirm my statements.
In conclusion I would like to point out that the issues raised are of the utmost importance. Are public men to be subjected to this kind of persecution, for that is the proper name for it, just because they will not yield to men of the type of Senator Fitzgerald? Are directors of bodies like the Industrial Trust Co., which are honourably trying to forward industrial development in Ireland to be subjected to vile and slanderous suggestions? The small director's fee means nothing to men of this kind. They give their time freely and it is a shame that they should be subjected to such attacks. If it is to continue the Government will find it impossible to get honourable men of standing to do any of this work. This motion is really a vote of censure on the Minister for Finance, who is responsible for the National Land Bank and its policy. I ask you to reject it, not because of this, but because no case has been made. I ask this House to condemn emphatically the conduct of Senator Fitzgerald and his associates in this whole matter.
I have had an unpleasant story to tell this House, and I assure you honestly it has been no pleasure to me to do so. I have endeavoured to state what I honestly believe to be the truth with moderation and without heat. I have had deliberately to suggest that a member of this House has gravely misused his position—that he has not only spread untrue reports and unfair suggestions, but has also supplied financial assistance to a periodical in order to give publicity to his attacks. The Ministers present, and many members of this House, know what I have been subjected to during the past year or so. I have felt these misrepresentations keenly at times, more keenly than I can say. At the same time, I trust I will have the courage to pay no attention whatever to misrepresentations or slanders, and as long as I remain in public life I propose in future to ignore them. If I am defeated in any public position I will retire willingly, but I will not resign because of attacks on my personal character or attempts to injure my reputation.
I did not intend to intervene in this debate at all but, in the words of Senator Douglas, after the slanderous attack he has made on me I think it is up to me to say a few words. Until to-day I never heard a syllable about Senator Fitzgerald's connection with the Land Bank. I did not discuss Senator Douglas with ten members of this House since I entered it. Every discussion that arose with regard to Senator Douglas in more than 50 per cent. of the cases originated with the other person. I pledge my word of honour that that is the fact. I never tried to injure Senator Douglas in any possible way. I adopted towards him the ordinary legitimate attitude which men of honour adopt towards one another. That is all I have to say with regard to that. As to the attack that Senator Douglas made on Senator Fitzgerald, the Senator will be able to look after himself. There are matters that perhaps I might tell the House that Senator Fitzgerald would hesitate to tell. When the Free State came into existence and when its life hung by a thread Senator Martin Fitzgerald came into possession of the "Freeman's Journal" and at that time he did more through the instrumentality of the "Freeman's Journal" to preserve the life of the Free State than any living man. That statement was made to me, and to many others, and many members of this House can bear testimony that that statement was made and endorsed by Arthur Griffith and General Collins, that were it not for Senator Fitzgerald and the "Freeman's Journal" at the time of the signing of the Treaty they could not have carried on. In doing that what did Senator Fitzgerald gain for himself? He squandered on the "Freeman's Journal," if that term can be used, a huge sum of money. He was imprisoned by the British Government at a time that I suggest that Government would not think it worth its while to lock up Senator Douglas. Senator Fitzgerald, naturally, does not like me to continue in this strain but, I think, in view of what Senator Douglas has said that I should pay that tribute to him.
With regard to Senator Douglas and his personal connection with me, all I can say is that long before I met Senator Douglas I knew friends who were intimately connected with him, and the general expression of opinion was that if there was one man in the city of Dublin who was on the make it was Senator Douglas. By reason of my occupation, I have a great opportunity of judging men, and since I came to know Senator Douglas personally I see no reason why I should doubt the opinion of those who expressed that view of him. He made a vile attack on Senator Fitzgerald, and coupled me with it. He adopted the old procedure of a certain class of legal practitioner who, when he has no case to make, blackguards the opposition. That is the case Senator Douglas made. He found he had no case. It is obvious to every one that a fair case has been established for the appointment of this Commission. It was also obvious that Senator Douglas could find very little to say against the attacks made on him. There was a celebrated character in one of Dickens's novels, Montague Tigg. He was connected with a lot of insurance companies, of which he was chairman, director, board and all. When I read in "Irish Truth" of Senator Douglas's many activities I said: "We have a modern Montague Tigg in Dublin." I did not intend intervening in the debate, but in view of the personal attack made on me I think I was justified in saying what I said in connection with Senator Douglas. I once met him in connection with a Bill, and this question arose. I candidly and openly told him that a director of the Land Bank ought not to be a director of a company to which the bank made advances. He explained to me as he explained to-day that he was there at the Government's desire. I have no personal animosity against Senator Douglas, and I repudiate all he has said with regard to me. As to the motion before the House, a certain report emanated from a certain quarter. The Comptroller and Auditor-General is a Government servant. He is not going to throw a slight on the Government, yet, in virtue of his office and responsibility, he finds that he is bound to tell the public this: that these Ministers exceeded their duty. Some aspersion, of course, is cast on them. I do not say it is an aspersion of dishonour or dishonesty. The report in print is made by their own servant, and they cannot get out of it. There is no explanation of it. What would be more natural than an inquiry as to the connection with the Land Bank?
It has nothing to do with it.
The place to explain that is before the Commission. Evidence can be brought forward, and the action in connection with the bank can be explained. Why the Government should refuse such a simple question seems incomprehensible. I intend voting for the motion, because I think it will give Senator Douglas a further opportunity of going into details and allow him clearly to vindicate himself.
I listened to this debate with a perfectly open and absolutely unprejudiced mind. The issue is one on which I have had no prior information. I never discussed it with any member of the Seanad or with anyone outside. It is not a subject that lends itself as some subjects may to explanation by debate except perhaps by persons specially qualified to understand this matter, among which I cannot hope to number myself. I, and others like me, have to make up our minds as to how we are to vote in regard to this motion. The question is, what is in the public interest? I think it best to disregard all questions of motives about which we heard so much this afternoon and, as far as possible, concentrate on such facts as have arisen and are not matters of opinion.
The State Auditor, the Comptroller and Auditor-General, it appears in regard to one of these transactions, was not satisfied that that transaction was up to the highest banking standard. Now on such a point as that it is most desirable that the National Land Bank as a State Bank should have public confidence.
Does the Senator suggest that a State-owned Bank should refuse the Minister's guarantee, and say it is not good security?
I do not propose to enter into a detail of that kind. I wish to deal with the matter on broad lines. The way in which this matter presents itself to me, and it may not present itself to other members of the House in the same way, is this: that it is most desirable that there should be public confidence in matters of this kind which are not at all easy to understand. Either the affairs of the National Land Bank are conducted in an irreproachable manner and up to the highest and most proper business standards or they are not. The motion on the Paper asks the Executive Council to set up a Commission to inquire into this matter. The Minister for Finance will speak upon this and that is a point I hope he will deal with very fully. The public have a right to be fully informed and informed in such a way that will give them the maximum degree of confidence in a matter in regard to a State bank. And I would like him to consider whether in the public interest there is not a great deal to be said for this matter being the subject of a report by a Commission.
Senator Douglas wound up his explanation by saying that this was an unpleasant episode. It is a highly unpleasant episode, but I cannot say that I regard the events of to-day as in any great degree unpleasant. All that has led up to it has been very unpleasant and very unwholesome, and therefore bad for the credit of the State. But that there should be an opportunity given to-day to have this thing revealed in this House I do not regard at all as deserving of the language which Senator Douglas applied to it. I have touch with three things discussed to-day, the question of the Auditor-General's Report and the transaction with Alesbury's, the question as to Senator Douglas being on the Board of Directors of Alesbury's, and the question of the Trade Loans Advisory Committee which has not been adverted to here, but which was raised in the articles. After Senator Douglas's explanation, I think there will be no real need to speak on the Auditor-General's Report and the transaction with Alesbury's in so far as they concern the National Land Bank. I ask anyone in the House to point out where is the criticism of the transaction from the banking point of view? Let me use Senator Bagwell's words. Senator Bagwell has been deluded into the belief that the Auditor-General's Report adverted to this transaction as not being up to banking standard. That I entirely deny. Where is there a line in the Auditor-General's Report making any reference to banking standards in connection with this transaction?
What right has the Auditor-General to refer to it as a banking transaction? The Auditor-General has a right to make reference to certain things and to the question as to whether the guarantee was or was not properly given. Take the facts. An application for a loan was put up. It was considered by the Advisory Committee and they sent it on to me with a statement that they did not believe it was within the terms of the Act. I asked the Attorney-General's ruling, and he said: "No, it is outside the terms of Section 1 of the Act." It comes up again in an amended form, and is passed by the Advisory Committee, and is put by my Department to the Attorney-General with a statement that having previously been refused in a certain form it is now presented in this new form, and he is requested to give his opinion whether or not that comes within the terms of the Act. He replies definitely: "This is within the scope of the Act." Having considered it from that point of view, I gave my sanction to the guarantee, and it goes to the Department of Finance to be considered by them, where it is also passed.
I intimate to a firm my willingness to give the guarantee, and with that intimation a firm goes to any bank. Is the bank within its rights in simply taking that recommendation of a Minister, not knowing that there is any question of legality raised, and not knowing that once the question of legality was raised it was decided in the affirmative by the Attorney-General? The bank is asked to advance the money. Where is there anywhere any intimation, in the Public Accounts Committee or otherwise, that the National Land Bank, to use Senator Bagwell's words, did not act in a manner up to banking standard? Let us be clear about that.
I will deal later with criticism of myself and the Minister for Finance in his matter. The motion asks for a Commission to examine into the affairs of the National Land Bank, in which the Department of Finance and the Department of Industry and Commerce were concerned, and one of the cases brought forward was the transaction of Alesbury's. We heard a lot of talk and apparently the position was misinterpreted by Senator Moore and Senator McKean, and we were asked to say that a Commission ought to be set up.
There is not the slightest shred of criticism of the National Land Bank on the whole transaction. As to the Department of Finance, this paper referred in some recent numbers to the embarrassment of the Ministry of Finance, particularly officials of that Ministry, by reason of this discovery, I think it was put, of an illegal transaction. In so far as anyone is embarrassed it is not the Minister for Finance, because it was that Department had raised the question of the legality of the loan, and that Department had kept up its opposition to the loan until the Attorney-General definitely and decisively declared that the application was within the terms of the Act. So far as the National Land Bank was concerned, and so far as the Department of Finance is concerned, there is no criticism with regard to these transactions. If there is criticism of myself I am prepared to meet that criticism any time.
The matter as put to me was:—Is a certain transaction, a certain application, made legally or not? Does it come within the scope of the Act? I take the opinion of the highest legal authority open to me, and that authority says "Yes." What am I to do? Am I to go to the Auditor-General beforehand and ask of that Auditor-General, who has no legal member in his Department, what he says about that transaction? Am I to disregard the opinion of the Attorney for the State, and say that though he decided in favour of the application being within the terms of the Act, I question it further, and take it to some other persons? I hold in so far as that transaction is concerned there may be criticism, but criticism and debate can only centre round my own action. The National Land Bank is not concerned, or criticised, and neither is the Minister for Finance or that Department. If anybody is to be criticised, the criticism should fall on me, and I am quite ready to meet it with the backing of the Attorney-General.
It is well we should make our minds clear. The criticism in the Auditor-General's Report is not of the bank in any shape or form. It arose in this way. The Act provides that under certain conditions certain loans may receive the guarantee of the Minister for Industry and Commerce. He may guarantee the repayment of them, but the Auditor-General says in his report that he thinks in this particular case the Minister for Industry and Commerce was not entitled to guarantee the loan. Under the conditions laid down in the Act he was not entitled to do it, and the criticism is of him and him alone.
I am glad to have that clearly explained. Senators are dealing now with a motion to appoint a Commission to inquire into the National Land Bank. That is one of the instances referred to. I think this House does not consider on that ground alone there is reason for a motion to inquire into the Land Bank. The Cathaoirleach has referred to the Auditor-General's criticism. I am going to be met with that criticism in another House, and it will be more directly the subject of debate there. I am not disposed to quarrel with what the Auditor-General says in his report. I simply make the comment that I think it would be better that the Aduitor-General, in making reports, should state the full facts. There is nothing to prevent his making any report he wishes. We give a certain licence to him with regard to criticism, so that the financial affairs of the State may be properly safeguarded. I say, with regard to the Auditor-General's Report, that from it we can learn that the Auditor-General does not always give the full facts. What was simpler for him to say than that the Attorney-General had ruled in another way, and he would then be giving the public the information they are entitled to get? There is no criticism in this report of the National Land Bank. It did not even enter the minds of the Committee of Public Accounts to say anything relative to the Land Bank, for it never entered the scope of their criticism.
Having considered the report of the Auditor-General they proceeded to investigate this transaction, and this interim report is the result. I am referring to paragraph 15 in the interim report, which says:—
"The Committee desires to make it plain that no question arises affecting the good faith of the company in applying for the guarantee or in responding to the suggestion that, so as to make it possible for the guarantee to be given under the Act, a formal reconstruction of the company should be made. The Department of Industry and Commerce for its part was eager to fulfil what was regarded as the primary purposes of the Act, viz., to promote employment in the Saorstát. The Advisory Committee recommended that the application was one which should be approved and the guarantee given. The Department, after making its own inquiries was assured that employment would be promoted to a noteworthy degree by the granting of the loan, and were satisfied that the assets of the company were a good security for a second mortgage. The Minister also for the greater security of the loan exercised his right to nominate a director on the Board of the reconstructed company."
That is the net result of the Alesbury case. That paragraph rather sums up the whole position. There are certain comments the Public Accounts Committee thought fit to make afterwards connected with an amendment of the Act so as to get the words "capital undertaking" better defined. They go on to say:—
"The Committee does not propose to express any views on the question as to whether or not a guarantee can be brought technically within the scope of the Act by winding up a company and formally reconstructing it so as to enable such a proposed new company, by purchasing the assets of an existing company, to carry out a capital undertaking."
That is the summing up of this whole Alesbury transaction, about which so much has been made. There is no criticism of the National Land Bank, and no criticism of the Minister for Finance. Any criticism there is is of me. I have met that to some degree here, and I am prepared to meet it further when the time comes. I direct attention to this point at the end of paragraph 15: "The Minister also for the greater security of the loan exercised his right to nominate a director on the board of the reconstructed company." I nominated Senator Douglas, as I said here, for the greater security of the loan, and it did come to my cars many months ago that he had been very seriously and very grossly maligned as a result of this transaction, and as a result of my action in nominating him on that board. The matter went so far that I thought it fit to address a letter to Senator Douglas which I shall read. It is dated 19th November, 1925:
"Dear Senator Douglas,
"I understand a statement has been spread abroad to the effect that you were financially interested and that you misused your public position in connection with the recent reconstruction of Messrs Alesbury Bros., Ltd., Edenderry, when a loan for that firm was guaranteed under the Trade Loans (Guarantee) Act. I cannot understand how any such improper action can be attributed to you as I know you were not at any time financially interested in Messrs. Alesbury. It was my Department who asked you to look into the position of the firm and see if anything could be done to get the factory reopened and we would not have done so had you been financially or in any other way connected with the firm. It was not until after the plans had been completed that I asked you to represent the Government interest by becoming a Director, and I am aware of the fact that you have no shares in the company and that you will cease to be a director at the end of the period during which the Government guarantee is in force. You are at liberty to show this letter to anyone, and I very much regret that the work which you undertook in this matter and for which this Department and everyone dependent on the prosperity of the concern is very much indebted to you, should have given rise to any such false and malicious statements as you have mentioned to me."
Senator Douglas took up that position at my request, and his help has been a great benefit to the carrying on of that concern. On more than one occasion when these rumours and slanders got abroad Senator Douglas was about to leave the company, but he was approached by the people of the neighbourhood who begged him to remain on as he was the only hope the company had of remaining a going concern. The question of the Trade Loans Advisory Committee has been raised in these articles. I consider myself liable to some blame, but I think the circumstances a sufficient excuse. The Trade Loans Advisory Committee as originally constituted was composed of Mr. J.C. Dowdall, Mr. Lionel Smith-Gordon, and the Chairman, Mr. Telford. About May of last year Mr. Dowdall asked leave to retire as he found his other business interests were being neglected by reason of the work he had to put in on this Committee. I saw him at that time, and I prevailed on him to remain on as I found it very difficult to get men of integrity, business experience and good commercial conduct who would consent to give so much of their time as these three gentlemen had given up to that date in assisting the State by acting on this Advisory Committee dealing with applications made under the Act. I prevailed on Senator Dowdall to remain for some little time and for that time I find a note on my own file with regard to the matter, and I noted this with regard to the members of the Committee that "They have done invaluable and onerous work without much recognition, and it might be desirable now both to accord them that recognition and secure a continuance of their services."
I have read that minute for this reason, that it shows even as early as last May how much definitely we regarded ourselves as indebted to these three gentlemen who gave up so much of their time and energy in investigating the applications that came in under this Trade Loans (Guarantee) Act. Senator Dowdall remained on until December last year, when he finally retired. Just before he retired the matter had been raised to me that inasmuch as the Industrial Trust Company was under process of organisation, and was likely to be started very soon, that it had become necessary for me to consider the reconstitution of the Trade Loans Committee, inasmuch as Mr. Smith-Gordon and Mr. Telford were going to be associated with the Industrial Trust Development Company. It was put to me on several occasions both by Mr. Telford and Mr. Smith-Gordon, that they should be allowed to resign. It was conveyed to me personally and through my officials. It even went to the point that when I had a social engagement at Mr. Smith-Gordon's house he asked me to come ahead of the others so that we might discuss that particular position. His anxiety at that time was not so much for himself as for the position in which I might find myself if criticism in this matter were raised. I was very anxious about the situation. I felt the information that was in my departmental files would reveal the position as I saw it, and my whole fear was the public criticism Mr. Smith-Gordon might be subjected to if he agreed to the request I pressed on him that he should remain and act with Mr. Telford on this Advisory Committee. I did that for this reason, that the Trade Loans (Guarantee) Act was due to expire in July of this year. At that period there had been no great number of new applications.
The applications that were under consideration had been very definitely seized hold of by Mr. Smith-Gordon and Mr. Telford. If I were to interrupt their period on the Committee at that point it meant that a certain number of good applications, from the point of view of the intentions of the Act— that is to say, the providing of employment—might be held up until I secured other committeemen, and got them fully seized of the facts. I pointed out to Mr. Telford and to Mr. Smith-Gordon that the Act would probably expire, that it would not be renewed, for that was generally the intention, inasmuch as what was aimed at in the Act would, we thought, be better done by the Industrial Trust Company, and inasmuch as there were no new applications coming in, and whatever applications had been in were considered by those two gentlemen, and they would have to be delayed until other gentlemen that might be appointed got acquainted with these cases. Inasmuch as the Trade Loans (Guarantee) Act was not at that time expected to be continued, I asked these two gentlemen to remain on. Their anxiety most of the time was with regard to my position. They decided to remain on.
I would not like to have to declare what was the exact date at which the Committee was dissolved, but I may say since last December I had it in my power at any time from resignations offered to me and almost insisted on by Mr. Telford and Mr. Smith-Gordon to dissolve the Committee. I allowed it to remain on. Recently when the Trade Loans (Guarantee) Act was about to expire I did change my point of view. There were certain realisations as to the work of the Industrial Trust Company and there were certain further realisations that applications were coming in under the Act. The number of applications acceded to and the number of sound applications that came in had, on the whole, been disappointing under that Act. But a number of applications just then came in, and after a consultation with the Minister for Finance he agreed that the Trade Loans (Guarantee) Act should be renewed for a further year. Now a new Bill for Trade Loans (Guarantee) is down for discussion in the Dáil to-morrow, and I am at this moment without an Advisory Committee. And as long as papers of the type of "Irish Truth" are allowed to carry on a campaign of this kind it will be absolutely impossible for me to get men of the integrity and business capacity that I require to give their services, if they are going to be subject to the kind of slander that has been so common recently—that is to say, unless they are stopped by the decisive action of the Seanad in turning down this resolution here to-day.
I say with full knowledge and some experience of the inside of Government offices that it is the most surprising thing that has come under my notice how few men there are who are anxious and who are even willing to serve on this type of committee where the work undoubtedly is onerous, where the responsibility is heavy and where the only return is to be subjected to ill-informed or else the maliciously-minded types of remark that this journal has been giving vent to of late. I am at present without an Advisory Committee. And even worse—I hardly know if I can approach anybody. I do not know what position I am presenting to any man as being likely to find himself in at the end of twelve months if I ask him to become a member of this Advisory Committee. Are all his transactions to be adverted to in that scurrilous way that Senator Douglas's transactions have been referred to by this journal? Is there to be any security for honourable-minded and decent men who are prepared to do honourable work for the State; and how is that to be got except by the repudiation of the motion put forward here?
Senator Moore supports this motion. He seconded this motion, and in answer to Senator Douglas says: "How could I have seconded it if I did not advert to these criticisms?" The main object of Senator Moore is to second the motion—without any care as to whether it is sound or unsound. There is an ordinary way of seconding a motion which one is not certain is sound, and that is by formally doing so without entering into a series of arguments. But this shows that Senator Moore is one of the type of person whom it was intended to mislead by this sort of criticism, or else he does not understand the report of the Auditor-General. This paper is called "Irish Truth." I think they should insert under that, as a sub-title, the phrase that was used by another slanderer of this country, "the truth, half the truth and nothing like the truth."
I knew nothing about the particulars that have been referred to and regarding which explanations have now been made here to-day. I did hear from time to time aspersions cast upon members of this House and on members of the Government in connection with transactions of the National Land Bank, but I do not remember anything clearly said; I could not get any tangible grip of any charge brought against any person. There were casual suggestions, rumours and suspicions only half explained away and which left a nasty taste in the mouth. When I saw this notice on the Orders of the Day this morning I rather welcomed it, and I am sure many other members of this House welcomed it also. It has given an opportunity to every member of this House and to any member of the Government whose reputation has been tarnished in this way to place before the public the facts in connection with these matters. Now, the public have no means of getting detailed information as to any of the rumours that reach it. It is only rumours and half-truths that reach the public, and they form their opinions on such data as they can get hold of. The result is that comments are made, and sometimes men's reputations are injured. It is essential that some direct opportunity should be given to clear their names of these imputations.
When I made inquiries as to the object of this motion I was told that it was merely for the purpose of giving everybody concerned in these matters an opportunity of explaining away their own action, and I think that object has been accomplished. I would suggest to the mover of this resolution that the setting up of a Committee would get us no further information, or would get us no information beyond what we have heard with regard to these charges and counter-charges to-day. A very lucid explanation has been given by Senator Douglas, confirmed by the Minister for Industry and Commerce and also by the Minister for Finance. As one who has had some connection with banking, I must say that it is above all things essential to the good name and prosperity of a bank that its directors should be men of, in the first place, very sound business capacity, and men of staunch integrity and that no imputations should rest against their names with regard to their activities and their finances as directors of the bank and he is doing, and who is more concerned with that bank. Nothing is more calculated to injure the good name of a banking institution than a rumour to the effect that the directors are using the bank in furtherance of their own business. That is the gravamen of the charge made here against the Land Bank. I think that has been dissipated by the statements made to-day. All those against whom charges have been made have been given an opportunity of explaining their particular relationship with the National Land Bank. Their explanations have been, I think, satisfactory.
With regard to the Minister for Industry and Commerce, his position was that under the powers conferred on him by the Trade Loans (Guarantee) Act he gave a certain guarantee to the National Land Bank under which that bank made certain advances. I have had personal communication on another matter with the Minister for Industry and Commerce and I must say that I have never met any Government official who is more particular and who wants to have a clearer idea of what he is doing and who is more concerned with the construction and interpretation and spirit and meaning of the Acts of the Oireachtas, than the Minister for Industry and Commerce. I am satisfied in this connection that unless he was absolutely sure that everything in connection with the application that was made to him for this guarantee was entirely in order and above suspicion he would not give a guarantee. Under these circumstances I am confirmed in the conviction I had that a Committee or Commission if appointed would not in any way extract more information than we have received here to-day in the way of refuting those charges. An opportunity has been given to those whose names have been connected with these things of showing the true position. Under all these circumstances I think this motion should be withdrawn. I ask the mover of the motion—I press him—to withdraw it. It would be a graceful act and it would certainly not be conducive to recrimination or further bitterness in this matter if he were to fall in with that suggestion.
I regret very much, as I am sure many other Senators do, that a personal element had to be introduced into this discussion. Having regard to the attitude that was taken up by Senator Fitzgerald towards Senator Douglas and the statements which were made in the article in "Irish Truth" and which were referred to in the Dáil, it was inevitable that this personal element should be introduced. With the personal aspect of the case I do not intend to refer further than this, that I am very glad that Senator Douglas has at last had an opportunity given to him to state the facts. I think that everyone who heard that statement must be satisfied that in the positions which he very unwillingly accepted he has acted with the most scrupulous regard to the standards of honour and integrity.
It is to the general aspect of this question that I wish to address myself for a moment or two. I deprecate, sir, very strongly the mode in which this question has been brought before the public, not in the Oireachtas, but outside. I recognise fully the right of every private citizen and of every writer in the Press to deal with and to criticise the financial measures of the Government. I myself have a very strong view on the desirability of carrying on a bank which is not a State bank with Government money. And I am not sure that the view that I hold is not one that is not shared by the Minister for Finance and by my friend, Senator Douglas. I recognise that the private citizen and the writer in the Press have an absolute right to criticise as strongly as they wish the financial measures of the Government. But when it comes to a concrete instance of an alleged abuse brought about by financial measures of the Government, the situation is entirely different. Once the conduct of a private individual is involved, the critic, whether he be a private citizen or whether he be a writer in the Press, has no right to refer to the case unless he has previously satisfied himself that he knows the entire facts, and is prepared to state them. Now, sir, it is not good enough to state as was done in this case, half the facts, and then to say that they did not suggest that Senator Douglas or any of those other gentlemen who have been implicated in these charges are not men of honour and integrity. A rumour gets started, and in this country we unfortunately are very suspicious and often inclined to believe the worst. Unfortunately the harm gets done, and most of the harm is not to the victim; it is to the country. The victim, if he is honest, lives it down. The country suffers.
If there is anything, sir, that this country wants more than another at its present early stage of national life, it is the service of its best men, and you will not get this service if the best men are to be subjected to the kind of attack that has been made in this case.
Now there is only one other thing that I wish to say. I hope no member of this House will think of voting for this resolution because it might be no harm. I beg of the Seanad not to adopt that view. To vote for this resolution is to condemn those against whom these charges have been made. Vote for this resolution on the evidence you have heard. There has been no case made for this resolution, so that to pass it would not only do an injury to the people who have been falsely charged here, but a greater injury to this country.
I think this resolution deserves a unanimous rejection. The Alesbury case has been fully disposed of, and I need not harp on it again. Nothing needs to be added to what Senator Douglas said on the other aspect of the case. He deserves the sympathy of members of the Seanad, because I know he has been subjected to a malignant campaign for some considerable time. I do not know who was attacking or who was carrying it on, but from time to time people have come whispering things to me, and I know, therefore, what appeared in "Irish Truth" was merely the coming to the surface of something that was going on certainly for the last couple of years. Senator Douglas has been anxious to have the position of the Land Bank changed for at least a couple of years. Possibly it was two years ago, but he said to me, certainly a very long time ago, that the position of the Land Bank was anomalous and could not be carried on as at present. My reply was: "It is not opportune to make any change now. At some later time it may be possible to do something, but meantime the Bank must be carried on," and it was at my urgent request that he came on and continued to be a member of the Board of the Bank. What Senator Brown said is true. It is difficult to get people to take up those positions of responsibility which expose the men holding them to every sort of attack, and if there were any countenance to be given by the Seanad to this motion it would be impossible, not only to fill posts like that of Director of the Land Bank, but also posts like that of a member of the Advisory Committee or any sort of position where a citizen was asked to take responsibility and exercise some sort of authority on behalf of the State. I do not want to go into Senator Fitzgerald's affairs at all. They do not directly arise on the motion.
I think you had better.
But I can say this: that I can confirm what Senator Douglas said, that some ridiculous proposal for an advance to the expiring "Freeman's Journal" was brought to me and that I told Senator Fitzgerald that the Government could not do anything about it, and said he ought to go to the Land Bank. That much at least I know, and I think, as the matter has been raised, I should mention it, but I say this: that I think there are ways in which a matter like this should be raised. Deputy Heffernan brought the motion before the Dáil in a very proper way. Certain things were put in "Irish Truth" and Deputy Heffernan drew attention to them. That was very proper. It gave me an opportunity of making an explanation. It would have been entirely proper for Senator Fitzgerald or any other Senator to have provided the opportunity in the same way. I think it was not right to bring it up in this way and that it was not proper for Senator Fitzgerald to do it in view of the fact that he had some sort of proposition to make to the Land Bank which was turned down. I am not committing myself to the figures.
You are making a mistake if you say I went to the Bank.
I know you came to me and the President and to the other members of the Government whom you could reach asking for assistance, and if you did not go to the Land Bank it surprises me. I think it really did not become Senator Fitzgerald to raise the matter, particularly in the way in which it was raised. I dealt with the matter at considerable length in the Dáil when it was raised by Deputy Heffernan, and I do not know whether it is necessary to go into it further. I have personal knowledge of the circumstances in which the account of John Douglas and Sons was transferred to the Land Bank. I mentioned that in the Dáil. It was done in part at any rate as a result of the institution of the Belfast boycott when people were moving their accounts. Then the directors of the National Land Bank applied to Mr. Douglas to transfer his account and they told him that the accommodation given to him by his previous banks would be continued by the Land Bank. Senator Douglas's statement with regard to not changing his account when he became director of the Land Bank was accurate, and I think he did exactly the right thing. Statements about the stability of the Land Bank were being put around, and certainly when Senator Douglas, at my request, became a director it would have been injurious to the Land Bank if he removed his account. He had only to continue his account in the position it was before he became a director.
References have been made to the Irish and Foreign Trading Corporation. That is a company started pre-Treaty at a time when we were all inclined to think, perhaps more than we do now, that the ordinary banks got too conservative and we had all sorts of ideas about what banks did in other countries and perhaps the Dáil Cabinet was rather anxious that things should be done to develop the country. The Irish and Foreign Trading Corporation was started. It did not achieve the things it was formed to achieve, but in any case when it was started Senator Douglas had nothing to do with the Land Bank. He was asked to come in from outside. It was a company that had a comparatively short life and then disappeared.
The circumstances in regard to the Peugeot cars have been explained by Senator Douglas. That transaction arose at a time when I had personal knowledge of the work of the Land Bank. What really was done there was when certain difficulties, shall we say, arose, a representative of the Land Bank was put on the board of the company. There has been nothing in the way of appointments to directorates except what arose for the purpose of safeguarding the interests of the Land Bank. In a number of cases steps were taken to safeguard the interests of the Land Bank. Where some other company has borrowed from the Industrial Trust Company in order to safeguard its own interests, the latter has specified that it should have a director sitting on the board with a watching brief. There is nothing before the Seanad that justifies the putting down of this motion or that would justify any support for this motion. As to myself, I say frankly I doubt very much if the motion were put down in good faith. I accept Senator Douglas's point of view that it was not put down in good faith without some personal spite in furtherance of the malignant campaign of defamation to which Senator Douglas has been subjected, and for that reason, because it is a motion which has not been supported by a shred of evidence, and which has been supported by speeches into which extraneous matter has been introduced in order to mislead Senators, I think it should be ignominiously rejected.
I agree with what Senator Brown and Senator Kenny say, that although we may still think it might be desirable to have an inspection of that bank, that would mean condemnation of certain individuals who, I do not think, deserve condemnation from anything that has been said here to-day, and therefore I approve of the motion either being withdrawn or negatived.
I never said that there was anything to inquire into or that there ought to be an inquiry.
Senator Douglas started by making very strong remarks about slanders, made by me against him. When he started I asked him to name some. I do not think he gave one. He attributes to me something I have not got. He attributes to me some interest or some capital in "Irish Truth." I have not the smallest fraction of an interest, direct or indirect, in it and I never had. I have had no control over and no voice in "Irish Truth." I have had nothing to do good or bad, cheap or dear with "Irish Truth" except to give them an advertisement. Senator Douglas says this is rather a vicious action on my part because I went to him for a loan of £350,000 for the "Freeman's Journal." That is absolutely untrue. There is not a scintilla of truth in it or that any person on my behalf went to Senator Douglas with my authority to ask him for a penny. There was never an application made on behalf of the "Freeman's Journal" for an advance of £350,000. The "Freeman's Journal" was in existence until it was suppressed by the English Government.
Does the Senator say the "Freeman's Journal" did not apply to the National Land Bank and that he did not ask me to see the manager?
You said I went to you and asked for a loan of £350,000. I say I never spoke to you. I would not know you.
On a point of explanation, I did not say he asked for a loan of £350,000. I said he asked me to see the manager of the company in which he was personally interested, that I saw the manager of the company and that it transpired that a loan which might amount to that would be required. The company is liquidated. The figures of what was required can be seen in the liquidated accounts and they are published. The fact that the loan was asked for is assented to by the Minister for Finance, and I have nothing more to say.
The less you say the better. On no occasion did any person representing me go to you. I personally went to the Minister for Finance. I explained to him the suppression of the "Freeman's Journal" in the British régime and the breaking up of the "Freeman's Journal" in what I might call the Rory O'Connor régime and the putting out of operation of the paper for six weeks. When the "Freeman's" machinery was broken up the "Freeman's Journal" was a concern making money. It was employing over four hundred people, paying out over three thousand pounds a week, over one thousand five hundred pounds a week being in wages alone.
The balance sheets are there and they will show that at that time the "Freeman's Journal," before it was broken up by the Irregulars, was a paying concern. Shortly after it was broken up, owing to a strike, the "Freeman's Journal" was being discontinued. I was personally asked by Mr. Griffith to continue the paper. I went to Mr. Blythe and explained to him that the "Freeman's Journal" would cease owing to the debenture mortgage and that an advance of £75,000 was needed. Between £40,000 and £50,000 would pay off the debenture mortgage, and £25,000 was required for working capital. For that the security would be the plant and machinery and the premises, which Senator Douglas says realised practically £47,000, and £40,000 absolutely reliable security. These were the securities that were offered.
When Senator Douglas says that I went to him for a loan of £350,000 I think he is making a slight mistake. I only want to correct the mistake. There is not a single scintilla of truth in it, just as there is not a single scintilla of truth in my alleged connection with "Irish Truth." It is like a further statement of his. He said that since he became connected with the National Land Bank he had nothing to do with the other company. He was director of the National Land Bank in 1922, and the Irish Trading Company was formed and incorporated in 1923. That was a limited company. These statements will hardly bear each other out. At all events I had no personal animus in bringing forward this motion. I was very slow in bringing this matter before the Seanad, but I have simply discharged my duty as one of the members of this House. When certain things came to my knowledge I discharged my duty by bringing them before the House, and it is for the House now to decide what it will do. I have done my duty.
All I wish to say is that the account of the "Freeman's Journal" can be inquired into in the company's register and it will be found, in confirmation of my statement, that a sum of £328,000 was then due to the bank. I maintain that this was the account we were asked to take over.
On the other point, I do not remember the exact date on which I joined the Board of the National Land Bank, but I can find it out and tell anybody here afterwards. The fact is, that the Irish and Foreign Trading Corporation was in existence before and the arrangements were made before I had anything to do with the bank. The Minister for Finance was on the board. He has a knowledge of the circumstances of the setting up of that company. I have simply to ask that his word shall be taken. I do not ask you to take mine.
Motion put and negatived.
