I do not know whether, after listening to the long and rather tedious debate yesterday, I would be doing the right thing in congratulating the Minister in his new office, but, at least I am very glad personally to see him there, and I feel confident that our encounters, if there are to be any, in the future will be much more amiable than they have been in the past. I feel that we will have much more common ground on the question of finance than we had on questions that divided us in the past, and I wish the Minister all success in his new and very responsible office. I feel that we get few opportunities here for a broad survey of our financial position. After all, finance involves much more than budgets and figures, as it reacts on every aspect of our national life. We get very few opportunities in this House for considering the position of the country in its broad aspects. I have always wished that we might have some change in our Standing Orders whereby we should have the opportunity in some form of considering, more or less under the heads of the Estimates, public expenditure, but apparently we have inherited the system of the country across the water where the Upper House has very little power. I think we should have more to say in day-to-day administration, because we have in this House a number of people eminently qualified to speak on general subjects.
I should like to look to the future, and to consider the main facts of our national freedom. The first is the freedom of Press and publications. I am only going to dwell upon it except that one point emerges, of which I ask the Minister to make a note, as it concerns the Department of Justice. The Minister may know that I introduced a Bill last October to amend the present Publications Act, but I withdrew it on the undertaking of the Minister that the Government were going to proceed with legislation more or less on similar lines. That was last October but we have got nothing yet. I feel that the Bill that I, with the assistance of certain officers of the House, drew up could have been quite well passed into law and would have worked. It may not have been in the best form, and yet we have to wait 12 months to get this much-needed reform. I hope the Minister will see his way to convey these remarks to the Minister for Justice.
The next plank in our freedom about which I am alarmed concerns security, and, in view of certain remarks made yesterday by Senator Duffy, the freedom of our Parliament, as well as the right to have a Parliamentary Opposition. I think we have to look only at this House to realise how fortunate we are compared to many countries, in being allowed to have an Opposition and a free Parliament. A free Parliament involves as a very definite element—periodic elections. There has been no suggestion that that feature of our Constitution should be in any way impaired.
Now I pass to a very essential feature of any sound popular Government and that is the matter of education. I naturally can only be brief on the subject. I think it is to be deplored that we have no indication of any form of policy or views in the matter of education, in the matter of raising the school age, in the matter of widening and improving the status of teachers, and all those questions that engaged such widespread attention on the other side and which are very necessary indeed if we are to have a sound healthy democracy. The education of the people appears to me to be the very keystone to any stable Government. Some day we may be able to arrive through education at the position that the average elector, when inducements are offered to him for his vote by various Parties, will be able to say: "I know something about economics." I think we might reach the stage when the average elector, if he heard Senator Duffy yesterday, would say: "That man does not know what he is talking about in that respect" and that he will be able to reject views such as the House heard yesterday. Looking to the future, I feel that there is a pressing obligation on the Government to give us an indication of a forward policy in this matter of primary, secondary and higher education.
That leads me to another matter bound up with the education of our electorate and that is this question of an indication by the Government, in advance, of their plans. Perhaps this may be somewhat of a new method in popular Government. But I do think that what we have seen lately on the other side is well worth copying. The Government there come along and give a general indication of their plans in such matters as education, medical services and full employment. They are not committed to any such indication. It takes the form of a White Paper which is published and a period is allowed for free comment in the Press and on the platform. Then it takes the form of a resolution in the House. Not until these preliminaries have been gone through is the actual legislation introduced. I feel that that will be in future the standard practice in any country with a healthy, popular Government. I am concerned to see that there is little or no indication of that here. We should have those plans in advance. We should have an opportunity of criticising them. We should have resolutions and a debate on them in both Houses. Not until then should we have legislation introduced and put into force. Then I feel certain that we will be proceeding on a much surer foundation and that there will be far less misunderstanding in public debate.
There is another matter in connection with education in a healthy democracy and that is a closer liaison between the Civil Service and industry. We are approaching inevitably a period of more and more control. Control involves increasing power in the hands of the Civil Service, power to regulate industry and private enterprise of every sort and kind. I think there is a necessity for a little understanding by both sides of the problems involved. Naturally, the Civil Service have their side of the matter. You have to have a certain amount of rules and regulations which are inevitable in any form of control. There must be a very considerable element of rigidity. On the other hand, in industry there is the necessity for quick decisions and a considerable element of risk. I feel that it is most important that both sides should get to understand one another better. I think the Government should consider some form of what has been called by various names, such as an industrial staff college or summer schools, or some opportunity where, in an informal atmosphere, representatives of industry and the Civil Service could meet under social conditions, get to know one another better, have lectures and discussions, so that each side would go away with a better understanding of the other fellow's problems. I feel that what you might call some fraternisation of that kind is overdue. I hope the Minister will see his way to have the idea brought up at the meetings of the Government.
Now I pass to this matter which has created a considerable and, I think, a quite unwarranted sensation within the last fortnight and that is the question of what they call our sterling assets. I feel that, if Deputy McGilligan had never spoken in the way he did and if the Press had not made such a hullabaloo about it, we would not have heard anything of the matter at all, because the whole thing really, in essence, is perfectly simple. It appears now that the whole thing is being approached apart altogether from the fact that there has been a war and that the whole of this dislocation of our economy is inevitable in the circumstances of war. Our trade has always been with one of the major belligerents. That belligerent, in fighting not only for its own survival but, incidentally, for our survival too, has had to abandon some 70 per cent. of its export trade. Instead of making goods for trade and export, it has had to make munitions of war for export in a totally different form and, of course, the effect of that was a scarcity of commodities and capital goods for all forms of industrial purposes. That is the root and the occasion of the whole of this growth in what you might call our foreign investments.
Let us be more particular for a moment and try to analyse first of all what these sterling assets consist of. There is one very substantial element and that is the money which was previously used as working capital in trade. That working capital, not being required, has had to remain static or inert for the present. That money either has taken the form of short-term investments or it has been placed on deposit in the banks. That money is available at any time when the opportunity for purchases arises. Then there has been another form. Owing to the inability to buy goods, and owing also to the large amount of services which we have rendered to that belligerent, large sums of money have come to this country and very considerable sums of money have been available for investment. That money has been invested according to the wishes of the holder either in gilt-edged stocks or in industrials, as the case may be. When we talk of these things been liquidated, the thing has no meaning. Those are ordinary investments made by you or me out of our money that we have saved, and there is no question of their being repaid. Probably, the investor may not want them. He may not be in business at all, and it may be an investment, on the income of which he lives.
Now, we have heard various figures stated of the volume of these increased sterling assets. I do not know where these figures are taken from, but the only reliable figures that I know of, and that are available to everybody, are contained in the record of the increase in bank investments. The money held in banks has, naturally, increased in late years for the causes that I have mentioned, and that is reflected in their investments. Undoubtedly, bank investments have substantially increased over past years. I shall just give you some very general figures in regard to that. Mind you, this is not a problem connected with this war alone. Identically the same problem arose following the last war, and yet we did not have all the hullabaloo arising from that, that we have now. From the figures I have here, I shall give you a periodic picture of bank investments over a number of years. In 1895, the investments of all the Irish banks were in the nature of £18,000,000. In 1915 they had increased to £35,000,000, and in 1922 they had increased from £35,000,000 to £103,000,000. There was identically the same problem then as has arisen in connection with this war. So far as this war is concerned, the investments, in 1933, were in the region of £85,000,000. Then they dropped. I need not go into the reasons why they dropped. The money was being used at home, and also the repercussions of what was known as the economic war here had something to do with it, but they dropped to £69,000,000. Then, in March last, they had risen to £151,000,000.
Nobody will deny that it is inevitable that as a result of the war people should be anxious. You cannot have a war, where all resources are put into slaughter and destruction and the production of the munitions of war, without the fear of very serious consequences, and very grave anxiety as to the future. It was an especially anxious time for us because one of the main belligerents was our chief customer. We might have succeeded in preserving a neutral attitude with regard to our war status and our political status, but we could not and cannot divorce our economic status from that of the country with whom we chiefly trade. You can see, therefore, that whether we like it or not we made quite a substantial contribution to the war effort in Great Britain in that way and, naturally, were concerned as to the results. Great Britain was fighting for her survival, and we, by virtue of our position in regard to her, as our chief customer, gave our contribution, and thereby, if I may say so, have succeeded in securing our own survival.
Now, I want to deal with certain remarks that were made by Senator Duffy when he spoke. I think that he gave a totally false picture of our economic position. He described queues at the Permit Office waiting to escape from the miseries in our homeland. He did not tell us about the queues for the cinemas, queues of people who, apparently, have plenty of money with which to enjoy themselves. He did not say anything about the apparent prosperity in the country where, even in the small towns, there seems to be plenty of money for amusements and other things. I am glad to notice that the Senator has arrived just in good time. He did not tell us anything about the apparent prosperity in the country districts. He did not deal, although he could have got the figures, with the very large growth in bank deposits held by our farmers. As I say, he gave a false and untrue picture of the country. The country is not in the dire want that he suggested, and the people are not fleeing from a condition of poverty; but having established to his own satisfaction that the country was in a very desperate condition and wanted relief, he then proceeded to say how it is to be done, and suggests that it is to be done by breaking the link with sterling—well, I do not say breaking the link, but breaking the parity with sterling. Now, admittedly, this question of currency is a highly complicated and very technical question, and I am sure the Senator is aware that this matter has been twice closely examined by men of very high repute and who are acknowledged authorities on these questions of currency. There were also associated with them members of the Labour Party. I grant you, they did not always agree, but they were associated with them, and perhaps I might be permitted to say that some of those who disagreed gave very inadequate attendances at the inquiries on which the Report of the Commission of Inquiry into Banking and Currency was based.
I think that that Currency Commission sat for four or five years, and went very carefully into this matter and gave reasons why we should remain bound to sterling. I am not going to go into the matter in detail now. The whole thing was set out in the report of that commission, which had closely examined the matter, and it was obvious to all of us, however we may lack expert knowledge, that if you want to trade with one country you will have to trade with that country on the basis of the same currency: that you do not want to have a fluctuating currency. However, with regard to the point Senator Duffy made, apparently, he was not altogether in favour of breaking away completely from sterling, but in some way or other to monkey about with the parity with sterling. He did not say how, but he referred to the breaking away by New Zealand and Australia. In that connection, I shall quote from the Report of the Currency Commission, page 133, paragraph 211, which is as follows:—
"It being agreed that a certain fixed relation to sterling must be maintained, the question arises whether the present parity is the appropriate one.
Firstly, we wish to point out that a change in the parity would introduce an element of uncertainty for the future as it would be impossible to prevent the anticipation of further changes. It would be natural for people to argue that what happened once might happen again. As the case of many countries shows at the present time, the existence of such a feeling is in the highest degree upsetting and a grave deterrent to enterprise and not least to the maintenance of low interest rates."
That is what the commission gave, after examination, as their deliberate opinion. If the Senator has another opportunity of speaking, I should like him to tell us how a mere alteration in parity would improve our position. Let me quote another extract from the report:—
"Thirdly, we may point out that in the actual situation a change of the parity in either direction would have undesirable consequences. If the Free State pound"
—we would say the republican pound now—
"became worth more in terms of the British pound, the consequence would be a fall in the payments that Free State producers would receive for their exports in their own currency. If, on the other hand, the Free State pound became worth less in terms of the British pound, the inevitable effect would be a rise in the cost of all imports and an accentuation of the present tendency to a rise in the cost of living."
The whole matter is far too complicated and far too serious to be dealt with in the manner which the Senator suggests. Here is a further extract:—
"With regard to the adoption of a ‘free currency', i.e., a currency free to vary upwards and downwards without limit to its exchange value, we have already presented what, in our opinion, are conclusive arguments from a practical point of view against any such choice."
I emphasise the following words from the report:—
"It remains to be said that no country has been able to allow such freedom of exchange movements, not excluding Soviet Russia, in spite of complete State control of that country's economy and finance."
I think that the House will agree that the matter is involved and far-reaching in its consequences. Currency affects the value of our savings and the whole store of our wealth. How does the Senator propose to deal with it? At present, parity is maintained by Act of Parliament. The Senator wants to leave it in the power of the Government, any day it thinks fit—perhaps in momentary panic—to alter that parity without the authority of Parliament. That is an astonishing departure from the democratic forms of Parliament in which I thought the Senator was a strong believer. There is no difficulty whatever in a democratic country in passing in a very short time an Act of Parliament which the people want. If we are to base our currency according to the whim of the Government at any moment, we should at least, reenact, alter or amend our legislation. I do not know if the Senator suggests that the Emergency Powers Act should be used to effect this purpose. The Government may not have the necessary power under the Emergency Powers Act but I think we can trust them, if they have those powers, not to use them in the way the Senator suggests.
What is the moral of the whole business? The moral is that, whether we are a republic or a member of the British Commonwealth, we cannot escape interdependence with our chief customer. That is plain for everybody to see to-day. What is the solution? The solution can only come by closer collaboration with the country with whom we are economically so closely allied. That is what makes me a little bit anxious about our present foreign policy. I am afraid, as I said a few days ago when the Taoiseach was here, that the atmosphere has deteriorated. Our prestige outside the country has, undoubtedly, grown worse, and we should make every effort to get back into closer collaboration with all countries involved in future world reconstruction. As Senator Douglas said, I do not understand this reference to going "hat in hand" to anybody. We should not stand upon any form of international or national punctilio, but should seek every opportunity of getting into closer collaboration with countries which are trying to work out the very complicated problem of a new international currency and the hundred problems involved in post-war reconstruction. I hope that the alarm—the completely false alarm —created by Deputy McGilligan's bombshell will at least have had the effect of showing the Government that, however politically independent we may be, we are bound up in the economy of Great Britain and of the whole world, and that we should seek every opportunity of lending our assistance in all the problems that will have to be dealt with in connection with world reconstruction.