This Bill is simply implementing the duty imposed on flour, 5/- per sack of 280 lbs. That is dealt with in Section 1 (1). Sub-section (2) deals with the licensing powers which the Minister may exercise in various circumstances to supplement the production of flour that is necessary, and to enable the importers, within certain limits, to continue to provide the amount that he considers desirable for the supply. Sub-section (3) deals with the penalties that are imposed for any infringement of the customs duties and any attempt to evade them. The Bill is self-explanatory and does not require any comment from me. If any questions arise out of it I will endeavour to deal with them.
Public Business. - Finance (Customs Duties) (No. 3) Bill, 1932 (Certified Money Bill)—Second Stage.
Question proposed: "That the Finance (Customs Duties) (No. 3) Bill 1932, be now read a Second Time."
I do not think this is a Bill that the House should pass without examination and discussion. Of course, I know now that we have duties in every shape and form with all the schedules that accompany them, all the complexities, elaborations, explanatory notes and provisos. But the complication of the subject should not deter us from trying to examine any special measure that comes before us on its merits.
I suggest that this method affords a suitable opportunity for such examination, because it is more or less concise and deals with one subject. I think we should have had from the Minister some explanation of what is the object aimed at in this Bill. Is it to protect the flour millers or the flour milling industry? Is it to protect the consumer or is it to increase revenue? I am not clear on these points. I would suggest to the House that the people primarily concerned in this matter are the consumers. I further suggest that the Government should enlighten us as to the steps that are now being taken in this essential matter of bread stuffs to protect consumers. My information—which the Minister may controvert—is that the 4lb. loaf in Ireland is anything from 1½d. to 2d. dearer than the 4lb. loaf in England. That being so, it is a serious matter and should be met to some extent. I have heard various explanations, which I am not going into now, but any legislation which tends to stabilise that, or to prevent its rectification, should be seriously considered by this House. I ask the House to accept the general point of view, that all these tariffs either raise prices or deteriorate quality.
Passing from that I would like the House to direct attention to the general system of licences. In explanation I should like to safeguard myself first—having regard to what happened before, when the Minister, referring to my criticisms of measures of this kind, accused me of imputing improper motives. I did nothing of the kind. I do nothing of the kind now, but I say that the licensing system proposed to be established is thoroughly bad. It gives opportunities to those in authority to grant preferences to individuals without the knowledge either of the general public or of competitors in trade. For that reason I think this whole licensing system should be most carefully examined. I know that it claims great justification. In fact, I do not see how you could ever carry on the tangle of our tariff policy without licensing, because the House can understand that it is impossible to foresee the effect of the duties. As it stands now, when the Government are in a mess or in a difficulty regarding duties, they fall back upon the licensing system and remove the trouble by granting relaxation of the conditions, or by allowing the goods in free. I hope that an examination of the facts will result in particulars of the licences being published in all cases, so that the public generally, and those in trade especially, may know all the conditions, and may know to whom licences will be granted.
I think that that is a very necessary check on the integrity of the Government, and a check that the Government itself should welcome. After all, in the case of a lease of Crown lands, where the dangers are of the same kind, I think the Government insisted that particulars of the lease should be published. If that necessity arises there, I think equally, and with greater force, it arises in the case of licences which can be granted to any extent—almost indiscriminately—all through our tariff policy. I can see no difficulty in the publication of these licences. They fall under one or two heads. Anyone can obtain a licence provided he satisfies the qualifying conditions, which must be clear for the guidance of the Revenue Commissioners. If they are clear enough for the guidance of the Revenue Commissioners they are published. There are other licences which are granted to individuals engaged in a special type of manufacture. I will mention one name which was mentioned in this House before, Messrs. Jacobs, who, I understand, will require special flour for certain of their products. Very properly that firm should be allowed a licence. I think particulars of the licences should be published as in the case of other licences granted to manufacturers. Therefore I hope the Government and the House will consider that the general principle of the publication of licences should be insisted upon.
Of course we all know what Senator Sir John Keane's views are on tariffs. Whatever validity they may have had in the past and particularly in the minds of people who follow trade developments post-war, not only this country but practically every country that wants to preserve essential and key industries, must, of necessity, fall back on tariffs. The Senator has admitted that a general tariff policy practically connotes licensing, and he pointed out that it is necessary to have a check on the integrity of the Government. In view of what happened in the milling and flour producing industries in this country, Senator Sir John Keane must know, as every man who has paid any attention whatever to the question knows, that it is most important to have a check on mass capital, which attacks such an essential industry as flour production. What would Senator Keane think if it were possible for some big German or French capitalists to get a stranglehold on the flour production of Britain? I do not think he would be looking for causes and objections to licensing.
This is a duty of ¼d. a lb. on imported flour. While Senator Sir John Keane talks largely on the general economic principles that obtained before the war, and before the troubles that are on this country, I would like him to consider—because I know he is a reasonable man—that emigration is stopped, and that we have a young population growing up which is anxious and eager for employment.
That is the great problem before the country at the present time, and, as Senator Dowdall says, one of the great dangers of modern commerce is this, that we are subject to the influence of great aggregations of capital called combines, and in this little country we must protect ourselves as much as we can against such combines. Certainly the Seanad should consider every proposal brought before it, and I am sure they will consider all proposals as wise and reasonable men and as patriotic Irishmen.
I do not think that the question of patriotism or anything of the kind comes into this matter at all. We have been asked to pass a Bill here about which the Minister in charge of it has given us absolutely not a word of explanation, good, bad or indifferent. Really and truly, one would suppose, as Senator Dowdall seems to think, that every Senator knows all about this Bill and knows why we are putting a huge tax on imported flour and all the rest. It is all very well putting a duty of 5/- on 280 lbs. of the stuff which makes our bread, but one would have thought, even taking Senator Comyn's ideas, that somebody on behalf of the Government would tell us how it is going to help unemployment. There is not a word about it. A statement has been made here this afternoon that our bread is much dearer than it is in England. Is that true? If it is true, somebody should explain whether or not this is going to make our bread cheaper or whether it will make it dearer still. These are vital questions, and I would have thought that somebody would have considered the Seanad and have given them an opportunity of looking into that question before passing the Bill. We know that we cannot hold up the Bill for any appreciable time, but we have the right to inquire what the effect of this duty will be, why it is put on, what good it will do; and, as Senator Sir John Keane says, we might ask also why a duty is put on in such a hurry when a safeguarding clause in Section 2 must be put in because, as the Minister practically says, he does not know, and has yet to find out, what amount of flour there is, and so may have to let it in wholesale.
These duties should be considered by the Government, at least to this extent, that they should know that practically these licences will not be required. If they are not required, then they themselves have not seriously enough studied the question, because how did they find out that a licence is required unless some portion of the community are not getting what they absolutely require? I have been here for quite a number of years and I never knew of any Government before this bringing such things forward in this half-digested state, and asking for full leave to pass a thing of which they do not know what effect it will have, and of which we do not know what effect it will have, and for which they must take this kind of remedy by licence for the blunders caused by the duty. None of these things whatever has been dealt with. I think that the Seanad ought to ask a few more questions and try to get a little more information. There is no desperate hurry that I know of. We could have been here last week, and if we had been called we would have all attended. I suppose that we will be told now that the days are so short that we have got to pass this Bill this afternoon or the country will be wrecked. I do not think that these things ought to happen, and that at the very first meeting of the Seanad we should be asked to pass a Bill of this nature this afternoon without any discussion. If we heard the reasons for the thing, if we were told why these duties should be put on, what mills are going to be helped, what employment is going to be given as a result of the duties, we might discuss them; but we have not a chance. We have nothing whatever except the Bill. If that is the way in which the country is to be run and these taxes to be put on, I doubt if there is a single Senator who knows where we are going so far as that Bill is concerned or why it is put up.
I should like to know whether the Minister can make a case for putting on a tariff at all. To the ordinary man who is in business, even the farmer who has cattle to sell, or his other exports to England, not alone is he opposed by everybody there but his goods are taxed going into that market. This is the case of a commodity in the world market— wheat. The Irish miller can buy it as cheaply as the English miller, and I cannot see what great trouble there is in crushing wheat into flour. I cannot see why a man buying wheat at the same price in Ireland as it is bought in England has to pay 50/- a ton to get it in here, and the Irish miller is protected to that extent in this matter. If the Irish miller would buy the corn here and mill it and put it into the English market, then we would know what they were doing, although the farmer at present is supposed to do more than that—he has to pay a 20 per cent., less 12½ per cent. tariff, on the goods going into England. I cannot see why a particular industry of this sort, if it were able to operate as the man on the other side of the water is able to operate, should require any protection. I cannot see any reason at all for putting 5/- on a sack of flour. Crushing wheat into flour is not such an involved process and I cannot understand why anybody should ask the people to have their bread made dearer because those engaged in the industry are not able to compete with those on the other side.
I was prompted to rise after Senator Jameson because it did not seem to me that he had been reading the Bill and had given to the consideration of it the thought it required instead of treating it as though it suddenly dropped from the moon. The Bill was ordered to be printed in the Dáil on the 19th October—last week— and it was passed last week through the Dáil, but the operation of it has been in effect since the 7th July and the tariff has been operative since that time.
The duty has been paid on it?
Yes, I think so.
Has the duty been paid since the 7th July?
Yes, wherever licences were not given.
To what extent have licences acted?
I am not in charge of the Bill, but I remember the discussion on the Resolution authorising the Minister to levy a duty of 5/- per 280 lbs. of flour, with the proviso—and it was intended to operate until a date I think in September or October—that there would be an effective prohibition of all flour except the particular kind of flour required for special purposes, such as that required by Messrs. Jacob. A period was given for the Irish millers effectively to become able to deal with practically the total quantity of the flour required in the country. If my memory is right—I have not looked up the matter within the last few days—licences were, in fact, granted to all millers from that date. Perhaps the Minister will correct me on that if I am wrong, but I think that was the general intention and the general effect.
When the duty has not been operative up till now?
I think that that is probably true, but as far as the Dáil is concerned that was passed on July 7th. Whether any money was actually collected as a result of the duty, I cannot say. What I do say is that this is not an entirely new proposition, and for the Senator to speak as if the Seanad might have dealt with this matter last week appears to me to be obviously wrong, because the Bill was not ordered to be printed until 19th October in the Dáil.
Senator Wilson again surprised me, having sat with him in the Dáil for a few years when he was an insistent advocate on protective tariffs.
On what?
On the many things for which the farmer requires protection. In this case, the need for protection on flour has been argued, I think, in this House many times, and it requires some hardihood, I think, for Senator Wilson to say that it is a simple matter to crush or grind wheat into flour and for Irish millers to compete with British or Canadian or American or other millers. According to him it is quite a simple matter, and if they cannot do it they should be allowed to die out. That is really the issue in this Bill—whether it is desirable that Irish millers should be allowed to die out, whether they should be permitted to face the competition of much more highly efficient mills working on a very much larger scale than is possible in this country, and whether it is desirable that that competition should be allowed to crush out Irish mills. If the case, as stated so often by Senator Sir John Keane, is accepted then they should be allowed to die out—it is a question of the survival of the fittest.
That is the only way.
I could understand his case if we were to apply it all round, but it is not at all defensible in this country unless one assumes that no Government, no organised community ought to concern itself with the maintenance of the national life. They should simply allow every individual to compete for his own benefit and take the risk of absolute annihilation. That position, as I say, is understandable; but in the circumstances it is not defensible in this country. If it were agreed that it is not desirable to allow an essential industry to be driven out by competition from outside, then I think that this method is a defensible method and a necessary preliminary to other methods that ought to be taken.
I do not think the Seanad has much need to argue the essential question at the bottom of this Bill—that the maintenance of a flour-milling industry within the country is desirable. If that is admitted, then we have to direct our attention to the question whether this method is a necessary method at this stage. Quite clearly 5/- per sack is intended to be prohibitive. It is not intended to be a revenue duty or a protective duty in the commonly accepted sense; it is a prohibitive duty, and it seems to me to be a necessary method preliminary to the organisation of the flour-milling industry. When the succeeding stage of this process comes before us we may have something to say in regard to the method of control and the method of developing internal flour-milling. So far as this Bill goes, it seems to me to be an essential preliminary to the development of Irish flour-milling.
Senator Johnson has reminded us that a Resolution came before the Dáil. I take it that this Bill will really make that permanent, and if this Bill is not passed by 5th or 6th November I assume that Resolution will cease to have effect. I do not think that Senator Johnson's argument as against Senator Jameson's is valid. The fact remains that we have not the ultimate responsibility of this coming into force. That is not a responsibility of this House. We have the responsibility of considering this matter and seeing whether there are any recommendations or suggestions that we can make. The Government propose that this measure should be put through all its stages to-day. I was very much interested to see in one of the leading daily papers the heading "Bill which Seanad cannot delay."
"Cannot hold up."
"Cannot hold up"— it is much the same thing. On inquiry I find that this is a Bill which the Seanad can hold up and hold up seriously, because even the three weeks provided in the Constitution have not been allowed us if the measure must be passed by 6th November. The fact is that we can cause a certain amount of dislocation. Of course, nobody here would consider it desirable to do anything of that kind. Senator Johnson seems rather surprised at the attitude of Senator Wilson and he assures us that when he was in the Dáil he was a protectionist. He must have had a very considerable conversion, because he has shown no sign of being a protectionist since he came into this House. I have had the privilege of listening to Senator Johnson in the early days of this State. I may say that he has changed somewhat and has become very much more protectionist than he was years ago. That may be an improvement. I am not suggesting that there is any particular virtue in consistency.
I would like the Senator to produce some proof for that statement.
I suggest that Senator Johnson's estimate of what is the essence in this Bill is not accurate. He says this Bill puts the question: Should there or should there not be a flour-milling industry in this country? That is not what is before us. The question is: Can you maintain a flour-milling industry by this means, and is it the best way of maintaining it? Further, I think when we are considering a matter of this kind the country is entitled to know to some extent what will be the costs of a tariff of this kind and what will be the corresponding benefits.
I am not an abstract free trader or protectionist. I always deprecate a discussion of general principles in relation to tariffs. On any particular Bill we should discuss the merits of the issue before us. In this case, I have not got any knowledge of the trade and I am not competent to discuss exactly how far this will assure the maintenance or the increased development of the flour-milling industry. I have no idea what the cost will be for this country. We had a slight indication, in the course of Senator Connolly's introduction, of the different points of view which some of us have towards tariffs of this kind. He said this is a confirmation of a Resolution passed some time ago by the Dáil. The present Government and those who support them regard the putting on of tariffs as a good thing in itself. That is their general attitude.
My attitude towards all tariffs is that tariffs are not in themselves desirable and, if tariffs touch the food or other essential commodities of the people, then they are less desirable and it is more essential that a good case should be made for them. If you put on a tariff dealing with luxuries so that these things may be manufactured in this country the thing is of relatively small importance; but if you are dealing with something essential, then a clear case has to be made for the tariff. For a specific tariff a clear case should be made showing what it will cost and showing the corresponding gain for the country.
Senator Sir John Keane dealt with the question of licences. We have a system under other legislation by which the Minister for Finance, with the advice of the Minister for Industry and Commerce, can allow goods in free of duty where they are required for manufacturing purposes in this country. This system of permits is absolutely essential to the present Government's scheme of protection. As long as the present method is adopted with regard to tariffs, it is absolutely essential that we should have some system of permits. In the case of the last Finance Act I moved an extension of this permit system so that it would apply to all tariffs. You can put on tariffs by means of a public inquiry through a Tariff Commission, but that involves delay. At the same time, that public hearing enables people, manufacturers and others, who may think they will have a grievance or be affected, to submit their case. When a tariff is put on without any public announcement and simply by way of Resolution— and, of course, it is essential there should be secrecy beforehand—then you will almost inevitably discover that certain important manufacturers are being hit by the tariff and if the Ministry have no power to grant licences they are almost certain to do a large amount of unnecessary harm, apart altogether from the merits of the tariff. For that reason, I am in favour of permits or licences.
Senator Sir John Keane suggests that it would be in the public interest to make these licences public. I presume he would apply the same to permits that may be granted in the case of goods required by manufacturers. I have an open mind on that question. I would like the Government to examine the matter and to see whether there is any fundamental objection to the publication of those permits or licences and, if so, perhaps they might tell us what that objection is. It is possible that by publication one might conceivably disclose trade secrets. There may be very good reasons against publication. If there are no good reasons, then I think it would be in the interests of the Government to publish the permits or licences. I am connected with firms to whom permits were given and I am confident there would be no objection to publication. I do not think any firm has a right to object to the publication of permits. It is a matter, however, that probably requires consideration. It is a very proper matter to raise here, and it might very well be considered.
I noticed that my friend Senator Dowdall was able to tell exactly what were Senator Sir John Keane's views about tariffs. I defy Senator Dowdall to tell what my views are.
Mixed.
There are two important aspects in relation to tariffs which I would like to mention. One is that they are the means by which combines are brought into a country. The great trusts of America were brought about largely by tariffs. Another serious objection to tariffs is that manufacturers are not satisfied with them, though they believed at first that a small tariff would do them good. You will find as time goes on that these tariffs are invariably increased. I think that that is the experience of the Free State. I think the position is that any industry which has been granted a tariff is inclined to seek an increased tariff to-day. That may be all right for boots and it may be all right for clothes, but it is a very serious thing when it means the taxing of a very important article of food for the community.
I know very little about the flour trade, but apparently I know rather more than the Government. It is rather interesting to note that in Cork City about 200 tons of milled flour come in every week. That flour is absorbed altogether by the bakeries in Cork. They have to pay a high price for it. I do not know whether this applies to Dublin, but we in Cork believe that we produce the best bread in the world, and the amazing thing is that the poorest member of our community will not be satisfied with anything but the best. I understand that the 200 tons of flour brought into Cork City weekly is the very finest flour that can be produced by anybody. It means that it represents one-tenth of the wheat that goes through the mill. The residue is an inferior type of flour for which the British public pay a good price and they are quite delighted with it. The Irish public, however, will have nothing but the very best.
There is another point about the flour trade to which I would like to direct attention. It came rather as a surprise to me to learn that the actual amount of flour required for bakers is not by any means the bulk of the flour consumed in the country. There is far more flour consumed in ordinary households than there is in the bakeries. There is far more bread manufactured in the homes of the people than is carried round in bakers' vans or exhibited for sale in the shops. This is a very important question. If the tariff were to remain as it is I probably would not consider it a very serious matter; but we know from experience that concession after concession will be urged by people interested, and every effort will be made to have further tariffs put on flour. I think it is about time that we should try to find out the facts which, as Senator Jameson has stated, have not been put before us.
I am quite prepared to believe that a tariff may be necessary in the case of imported flour, but I certainly think that tariff should be confined to the finer quality flour, which cannot be produced in this country. Senator Wilson is quite right in saying that any mill can turn out a special brand of flour. The difficulty, I am told, is that the residue is unsaleable here, although it is eagerly sought for by our benighted neighbours. I think it is only reasonable that the Government should give us more details in regard to the position of flour-millers and flour importers.
I am very glad that Senator Sir John Keane and Senator Jameson have asked for an explanation of this. We are all amazed at certain things that we have heard here to-day. Senator Johnson expressed himself as amazed at Senator's Wilson's attitude. I think we are all very much amazed at the attitude of the Labour Party in favouring a tariff which is bound to raise the price of the most necessary commodity of poor people. We do not understand it. Speaking about tariffs in general, Senator Dowdall seemed to think that they had been a great success in other countries, and had brought about great blessings, and that they were going to do the same here. In the last few months, since tariffs have been put on wholesale, we have seen unemployment increasing every day as a result. Senator Comyn spoke about that aspect of it—about all the young people who are growing up and who require employment. As we see every day, people are being thrown out of employment as a result of the tariffs. Theory is one thing and practice another, and the practice is not going to be anything like a pleasant matter for the country. I lived in Cork for some time, or stayed there at any rate, and I am sure Senator Crosbie is right when he says that the best bread in the world is made there. I am wondering what the unfortunate Cork people are going to do when the great wheat scheme comes about. My experience of the flour made from home-grown wheat is that the people who use it are always suffering from acute indigestion, not to mention any greater ills.
Might I call the attention of the Seanad to the question of the cost to the consumer of this tariff? It is five shillings on 280 lbs. That is roughly, as near as you can go, one farthing per lb. or one penny in the 4 lb. loaf. That is one halfpenny in the 2lb. loaf, which is the usual size of the loaf consumed in this country. That is a very serious increase in the cost of production of the ordinary bread food of this country. If we could produce flour as cheaply as the flour that is imported, and of the same quality, there would be no reason for this tariff. It is because we cannot do it that the tariff is being put on. I should like to ask the Minister if the Government have considered what this is going to cost the consumer.
The real reason for the introduction of this tariff is being lost sight of, and that is, to preserve the flour-milling industry here.
At what cost?
We are losing sight of the other side of the picture, that in recent years attempts have been made by large combines to get control of flour milling concerns here. We know from previous experience, and from what we read of the ramifications of trusts in other countries, that they first gobble up all the small concerns and, when they have wiped out all opposition, the consuming public have to pay through the nose for the ramifications of the trusts.
With a world price for flour?
That is the experience of people who were foolish enough to allow such an important industry as flour milling to be gobbled up by foreign combines. It is true to say that the mills in this country do not produce sufficient flour for the production of bread and the other commodities required. That is a disgrace to ourselves. We should not allow that to take place. In connection with an essential requirement of the people, it is the duty of every self-contained country to see that it is in a position to produce the bread of life in the quantity required. We should not be dependent on any other country for our daily bread, and should ensure that the mills here are so carried on as to be able to produce sufficient flour to feed the people. There is a provision in this Bill that the Department of Industry and Commerce may issue licences, and we all know the reason for that. We all know that there is a very large concern in this city giving a tremendous amount of employment which may have to import foreign-made flour for its special products. Provision is being made for that and provision is also being made in the event of the mills here not being able to mill sufficient flour for the requirements of the people. In these cases permission will be granted to import flour.
As to the question of the effect of the tariff on the price of bread, it is a most astonishing thing that, from my knowledge of what happens in the bread trade, the price of bread can be raised at any time that a number of people want to raise it, and there is nothing to control them. Senator Brown knows that. Notwithstanding what the price of flour was the price of bread was raised and the increased price kept on for six months. A certain small number of people could decide what the price of bread was to be and there was no control of that. I am opposed to anything that will inflict hardship on the people by increasing the price of food, but I am in favour of giving people employment to put them in a position to buy food. Some people are wondering at the attitude which the Labour Party has taken up on this issue. In reply to that, I want to say that when the Labour Party were fighting in this House to try to get sufficient wages for people employed on Government contracts to enable them to buy sufficient bread for their children, a lot of people who are interested in the attitude of the Labour Party on this occasion did not bother themselves to support the Labour Party to enable them to get people employed on public works in this country with adequate wages to enable them to buy sufficient bread for their families.
This is a Bill to protect the milling industry. I believe that is the first essential of it. The protection is afforded by the imposition of a duty of 5/- per 280 lbs. of flour, which Senator Brown has told us means about 1d. in the 4 lb. loaf. If we take the price of the 4 lb. loaf here as 9d., then the duty imposed under the Bill would be equivalent to about 10 per cent. on the loaf consumed in the country. Is it the intention of the Government that consumers should bear that impost in order to protect the milling industry? Senator Farren told us that we are in danger of an invasion of large industrial combines. Personally, I have heard nothing about it in connection with the milling industry.
Did you ever hear of the name of Rank?
I cannot say that I have.
You are the only one that has not.
However, I have no doubt the Minister will be able to tell us whether there has been any attempt to introduce a large combine into this country with the result that all our small milling industries would be abolished. I should like to ask if I am right in thinking that, if the Bill goes through, the result will be that consumers generally will have to pay 10 per cent. more for the bread they consume and that that will be the entire cost of the protection of what I might call the small milling industries?
This will protect the combines, too.
I do not know whether I ought to apologise for not going into greater detail when introducing this, but I really was under the impression that everyone in this Seanad knew the position with regard to the duty on flour and knew exactly what was done about it. A Resolution was brought in and passed on 6th July imposing a duty of 5/- per sack on all imported flour, but allowed for the issue of licences by the Revenue Commissioners, acting on the advice of the Minister for Industry and Commerce. There may be a good deal to be said with regard to the issue of licences, but I think Senator Douglas has explained the matter and that it does not need any further explanation from me, when he indicated what is the fact, that a tariff of this nature can only be imposed over-night; that you cannot give notice of a tariff of this nature. Therefore, the imposition of such a tariff may beget certain peculiar difficulties whereby licences will have to be made operative. The licensing system that was in mind when the tariff was put on was very definite. It was to ensure that adequate supplies of flour would be allowed in free of duty so that there would be no hardship on the people and that no miller would be held up for want of flour or, on the other hand, be forced to pay a duty of 5/- per sack on flour.
What is the position of the flour-milling industry? Senator Guinness told us that he never heard of the name of Rank. I think we discussed the flour-milling industry in this House at considerable length, and that the name of Rank emerged occasionally during that discussion. We were told by Senator Brown and Senator Sir John Keane that we are going to make the foodstuffs of the poor dearer, that this business of imposing a tariff without adequate consideration, putting it on over-night so to speak—an ill-digested scheme I think Senator Jameson described it as—was going to lead to an increase in the cost of living. I should like the Seanad to reflect on what the position of the flour-milling industry was; why protection was needed; why it should have been given years ago, and should not have been left until the present Government came into power to deal with the matter.
On 16th April, 1928, the Tariff Commission reported against a proposal of the ex-Minister for Finance to put on a tariff of 3/- per sack. In 1929, as I explained in this House when we were discussing the whole flour-milling issue in this country, the flour millers in England got down to a basis of rationalisation for the whole flour-milling industry in Great Britain, and included this country in it, with the results that we know. An agreement was entered into by the Irish Flour Millers' Association on 1st May, 1930, to restrict the output of Free State mills to 50 per cent. of their capacity. That was done to meet the rationalisation proposals of the British millers and with the definite object in view of getting back the money they had lost in the internal and uneconomic competition that prevailed in Great Britain. It was done to get that money back not only in Great Britain but in this country, and to provide that our mills would be reduced to 50 per cent. of their capacity.
That is the position that we were faced with, and that is the position that was argued and debated in this House when the ex-Minister for Industry and Commerce could give us no undertaking that he would do anything about the Irish flour milling industry. We are faced with this position and with this problem: whether we are going to be in a position to ensure that this basic food-stuff for our people is going to be produced within the country, and that we are not going to be at the mercy of the British millers or any other millers— Canadian, American or others. That is our policy. We think it is the right policy. We think that when a rationalisation process could be carried out at the instigation of a British combine whereby our capacity would be reduced to 50 per cent., it was time to sit up and take notice and get something done about it. This tariff of 5/- per sack is not an imposition, nor does it lead to an increase in the price of bread. Licences have consistently been issued and will be issued until such time as we are able to supply the entire needs of the millers of the country.
At the same price?
That all depends on wheat prices.
What does Senator Brown mean by the same price?
At the price flour would have sold if this tariff had not been on.
There is a world price for flour. If we are short 70,000 sacks, and if we require that quantity, then that flour will be allowed to be imported. When this tariff was imposed on 6th July, it was made perfectly clear that until 29th August flour importers, whether bakers or others, would be licensed to import flour, free of duty, up to 29th August, on the basis of 100 per cent. of previous imports averaged over the years 1929, 1930 and 1931.
With regard to the points raised by Senator Sir John Keane as to whether the licences ought to be published or not, I am not at the moment in a position to say, but I am prepared to consult with the Minister in charge of the Department and with the Executive, generally, as to the desirability of publishing these licences. There are, as Senator Douglas stated, possible objections to that from the traders' point of view, but I can assure Senator Sir John Keane that there is no objection whatever from the Government point of view.
Senator Sir John Keane raised a question as to the price of the 4lb. loaf, and stated that it was dearer in the Free State than it is in England. It is. It is dearer too than in the Six Counties during the last ten years. Yet, in spite of that we have never heard from Senator Sir John Keane that in the interests of the working people and the working classes here anything should have been done in the last ten years about it. We are taking certain steps in a Bill which will shortly be coming before this House. I have no doubt it will meet with the entire disapproval of Senator Sir John Keane, on the grounds of direct interference with the liberty of the subject and the freedom of trade. That Bill will control prices, and will, I hope, set the price of bread right, as Senator Sir John Keane seems to want to have it set right.
The Senator thinks it will.
We may not be able to do it, but we would be able to do it if we had co-operation instead of wavering from one side to the other just as it suits. That is what the Opposition attitude has been. I just want to say that this discrepancy in prices has existed all along the line. It is not a new thing following the imposition of the five shilling duty on flour. Senator Jameson seemed to be very much annoyed that there was no explanation of the Bill. Really, I do not see that any explanation was necessary. The action it proposes has been in operation for some time now. It surely is not reasonable to think that intelligent Senators did not know that this Financial Resolution has been in force. The Bill itself is fully explanatory.
With regard to the scheme in operation up to 29th August, I would like to know from the Minister if that has been carried out or whether the position is that only certain firms are getting licences? Can the Minister say if they are all allowed to import free of duty on the 100 per cent. basis?
I am not in a position to answer that fully, but generally speaking the position is this: that licences are being issued to such districts and to such importers as are found to be necessary in particular circumstances. I might explain it this way: that in Donegal, for instance, we have had to make special licensing arrangements to meet the peculiar circumstances that exist there as distinct perhaps from any other county.
But the price is not being raised accordingly?
No. Senator Jameson raised a question about the hurrying through of this Bill, and referred to the fact that there was a motion on the Order Paper in my name to take the remaining stages of it to-day. All I want to say on that is that that motion need not be gone on with to-day. I was advised by the Clerk of the Seanad that there would be no business for the House next week except, possibly, the further stages of this Bill. It was suggested to me that as the Bill was one on which the Seanad could only make recommendations and was practically a measure to confirm the financial Resolution that had already been passed, it might be advisable to have the remaining stages put down for to-day. If, however, the Seanad wish to hold up the Bill, and to meet next week, well, that is a matter for the Seanad.
Does the Minister mean that if we do not pass the Bill to-day there will be more than an ordinary hold-up of it?
This Bill must be through by the 6th November. There will be plenty of time to meet next week to put the Bill through its remaining stages if the House feels justified in taking that course. Senator Wilson raised the question of selling goods in England, and spoke about the lack of necessity for protecting the millers. Well, I think it has to be admitted in view of what we know—I do not want to go into all the details of the Rank controversy again—that our millers need protection. In view, too, of the important nature of this industry, concerned as it is with the food of the people, we are obliged to take a very direct interest in it to see that the flour milling industry is properly controlled. Furthermore, I want to point out to Senator Wilson that the proposal contained in this Bill has not made bread dearer and there is no reason why it should. On the contrary, if properly looked after, it ought to make the price of bread cheaper. We hope, too, that when the Control of Prices Bill comes into effect it also will tend to make bread cheaper.
Senator Douglas referred to certain newspaper reports. I am afraid I cannot take any responsibility for newspaper reports, and God forbid that I ever should. He also mentioned —I think I am quoting him correctly— that it might seem as if the putting on of a tariff was a good thing in itself. Now that is not the Government idea. I have stated here time and again that we do not consider that tariffs are in themselves going to be any solution of our economic problems. They are part of a necessary line of action that in all the circumstances we must take, faced as we are with world conditions as they exist. But we have no delusion that tariffs are going to be a solution of our economic problems. I certainly never had, and I have not to-day. I would much prefer an economic solution that would dispense entirely with tariffs: one that would get to the root evils in a much more drastic way than tariffs.
Senator Crosbie referred to the fact that tariffs beget trusts: that they bring about trusts and combines, and that the experience in other countries has been that where tariffs are imposed they are followed by a combination of companies that form trusts or combines. I do not dispute that that can happen, but I suggest it can also happen without a tariff. I suggest, further, that it has happened without a tariff on this particular issue in this country. There is no greater example of its happening without a tariff than in the case of this flour-milling industry. I pointed out here on a previous occasion that the British combine of Ranks, the Co-operative Wholesale, and Spillers and Bakers, having lost £5,000,000 in internal conflict competing in the flour-milling business in England, came together and rationalised. They came to this country with that combine and they forced the Irish millers to toe the line with them. Otherwise, they would have squeezed them out, so that a trust or combine is possible without a tariff. Therefore, any protection that our native millers can get against the big international combines has certainly to be approved of.
With regard to the quality of the bread that they eat in Cork, I am not in a position to speak. I happen to have investigated about ten years ago the whole question of milling from the health point of view, and I believe that one of the worst things that can be used as human foodstuff is superfine refined white flour. My approach to this proposition ten years ago was this —I make the confession now—do not impose a tariff on imported flour, but impose restrictions under pure food laws that would prevent superfine bleached flour being imported here. I do not know whether that would appeal to Cork, nor do I know whether the country would stand for it or not, but I want to point out that if Cork wants a special brand of superfine flour it has got to pay for it. I hope, therefore, that they are not getting their superfine flour on the basis of necessity. Senator Farren to my mind has answered Senator Brown that this cost is passed on to the consumer by the baker.
It undoubtedly is.
First of all, there is no cost to the baker. Therefore, there is no cost to pass on. Secondly, as Senator Farren explained, the price of wheat and the price of flour have borne no real relation to the cost of bread.
That is not so.
Well, I would like to say this, that James Inglis, in Belfast, is paying a 25 per cent. dividend and selling bread at a farthing a loaf cheaper than the Dublin baker. That requires some explanation.
Is the standard rate of wages the same in Dublin as in Belfast?
I cannot say the exact relationship, but I believe the trade union rate applies all round.
My information is to the contrary.
I hope to see that matter dealt with under the Control of Prices Bill. There is no price to be passed on by the bakers at the present time, nor is any attempt being made to pass any increased price on to the price of bread at the present time. Now I have dealt rather more fully than I thought would be necessary with regard to this Bill. I understand it has to be law by the 6th November, and it is now a matter for the Seanad to decide whether they will finish all the stages of the Bill to-day, or meet again to deal with it next week. Meantime I now move that the Bill be read a second time.
How many people does the Minister estimate will be employed as a result of this tax?
I am not in a position to give an answer right off, but I shall investigate the matter as to what the entire employment will be when the mills are working full capacity. I may say, for the benefit of Senator Wilson, that it must be remembered that this tariff is only part of the general scheme dealing with flour milling and is correlated to the whole of our wheat proposals.
The Minister tells us that this is largely, or very largely, directed against combines. What is to prevent a combine coming into this country? How will this Bill prevent a large combine coming in here and milling flour? A combine of the name of Rank has been mentioned. I never heard of it.
It is here.
Take the Rank case. Will the 5/- on imported flour touch him or interfere with him in any degree?
We want to protect him.
Will the Minister say how that will work?
The question put by Senator Guinness is, I think, rather involved. I do not quite know what he wants. I think he wants to know will this Bill prevent a combine coming into this country. This Bill, specifically, will not, but there are others that might.
The combine will have to pay the 5/- or they would not get the licence.
Question—"That the Bill be now read a Second Time"—put and agreed to.