Seanad Éireann díospóireacht -
Wednesday, 15 Jan 1947

Vol. 33 No. 6

Industrial Alcohol (Amendment) Bill, 1946—Committee Stage.

Sections 1 to 3 agreed to.

SECTION 4.

Question proposed: "That Section 4 stand part of the Bill."

Mr. Sweetman

This is what might be termed the operative section of the Bill in so far as the existing powers under the Principal Act and the extension of them are concerned. The objects of the company are covered in the Schedule to the Principal Act but those objects are extended by paragraph (c) of this section. It is dealt with by way of deletion of paragraph (c) in the Schedule to the Principal Act and the insertion instead of the paragraph that is now before us. There is in respect of this considerable uneasiness in certain circles. It has been rumoured—I do not know with what truth, but I think it is absolutely essential that the truth or falsehood of the rumour should be cleared up beyond question—that one of the things that Ceimicí Teoranta propose to do is to manufacture potable spirit, that is to say, spirit for drinking purposes. It is very desirable and essential that the House should know what is intended in that regard. I go further and say that it is essential that the House should determine that the company that is being set up here should not produce potable spirit.

The situation in regard to distilling in Ireland is far too well known to every member of the House for me to discuss it at any length. It is divisible into two aspects. There is first of all the aspect of the export trade. The distilling industry is one of the ways in which we get very considerable currencies from abroad by export, particularly hard currency. It is an export business which has been brought up and nurtured and has thrived on the fact that Irish spirit sold abroad is pot-still whiskey of a certain well-known class and perfection. It is entirely on that basis that the good name of Irish whiskey has become known abroad. The company that will be set up under this Bill is not going to produce spirit by pot-distillation, and it is by pot-distillation that Irish whiskey has built its name. It will manufacture spirit by a synthetic process. It would be absolutely disastrous to the good name of one of our principal industries abroad if there could be any possibility of doubt that any spirit, even though it would not be under the name of Irish whiskey, would be exported which might run the slightest risk of damaging the reputation of Irish pot-still spirits as sold abroad.

Apart from the question of export, there is the home market. I am a babe in matters of the distillation of spirits, without going into the question of whether I have any knowledge of certain other aspects of the product. So far as I understand, the situation in regard to the home market, pre-war —it is not fair to take emergency years—was that all our needs of the home market of potable spirit were adequately met by existing private enterprises, and there was only a very small importation, comparatively, of other drinks and spirits. The other drinkable spirits that were imported were brought in in a manufactured state and there was no raw patent still spirit imported for the purpose of being manufactured into drink in Ireland. If there had been, I would be quite prepared to agree that we should make patent still spirit here rather than import it but, in fact, there was not.

Therefore, it seems to me that in so far as the home market is concerned, if this company is, in any circumstances, to produce spirits for drinking purposes, it can only do so at the risk of displacing the product of the existing industry in the home market. The existing industry was quite well able, prior to the emergency, to cope with the demand here. The existing industry is not able at the present moment to cope with the demand, not because of any defect in itself but because Government controls have not allowed it to produce as much as it would wish to produce. I am not attacking Government control for one moment. It is perfectly obvious, in the circumstances that exist at present, that barley must be diverted to purposes other than distillation but I do suggest that, if it were not for that control, the existing industry would be well able to cope with the home demands. If any other spirit is introduced to meet that home demand, it can only achieve one of two things. It can only take a certain portion of the market from the existing industry, or in the alternative, mean that it will increase our spirit-drinking capacity as a people. Quite frankly, I think that capacity is high enough already. I do not think for a moment the Minister intends to do that.

Seeing that there is this feeling of uneasiness in the country at the present time because of the rumour that it is intended by this company to engage in this trade, I think it would be very undesirable, either for the home or export market, that these rumours should go uncontradicted. As it is so desirable I think it would be wise to put, as an express instruction in the terms of the Bill, a proviso that this company should not sell any spirit for drinking purposes. I go a little further and say that it should use its best endeavours to see that any spirit which it does sell shall not be used by somebody else for drinking purposes. That is quite a common method of legal expression—that a company shall not do something and that it will do its best endeavours to see that somebody else will not do it, otherwise I could come along, buy the spirit from the company and sell it for drinking purposes afterwards.

I think this matter affects very vitally a major industry, and I think that major industry is entitled to be assured, as I am reasonably confident that it will be assured by the Minister, that there is no intention of doing what these rumours suggest. As these statements have been made in several quarters in the last week in the city, I think it essential that there should be something specific on this point in the Bill. If it had been clear to me earlier that the rumour was as current as I since have heard it is, I would have put down specific amendments for the Committee Stage. Having regard to all the circumstances I would ask the Minister to clear the matter up, not only to clear it up by his own assurance here but to clear it up for future Ministers and for the future working and direction of this company by inserting in the Bill a specific proviso preventing the company from carrying on in the way that I do not think the Minister intended it to carry on, in a way that might give rise to a great danger in the future and that would be absolutely disastrous to the existing industry.

Mr. O'Dea

I do not know on what my friend's fears are founded. Is it on the reading of the sub-section—"the manufacture, refining and sale of industrial alcohol and products and derivatives thereof"? Surely industrial alcohol could not be called potable alcohol? I take it to mean alcohol for industrial purposes. As regards the term "derivatives thereof", supposing in the manufacture of industrial alcohol a product was obtained in the nature of pot-still whiskey—I do not say that it could happen.

Mr. Sweetman

It could not happen.

Mr. O'Dea

If it could not, there is no ground for the fear my friend has expressed. Then it could not be a chemical product. If it is a chemical product, a licence must be granted by the Minister for its production. Before he grants that licence he must publish a notice in Iris Oifigiúil and other papers of his intention to do so. If such a notice were published, I presume there would be an outcry from the whiskey trade to the effect that there should be some method by which they would get the benefit of the product. On the other hand, if such a product can be derived from industrial alcohol is it suggested that it should be thrown away? If so, that would be a very serious matter.

Minister for Industry and Commerce (Mr. Lemass)

I am not aware that there is any widespread uneasiness of the kind suggested by Senator Sweetman; in fact I am quite sure there is not. I want to make it quite clear, however, that under the Industrial Alcohol Act of 1938, the company was fully empowered to make potable spirit and the new company which will emerge on the passage of this Bill, Ceimící Teoranta, will have the same power as the Industrial Alcohol Company in that regard. Industrial alcohol, undenatured, is used in the manufacture of certain liqueurs and, I think, also in the manufacture of gin. If any firms in this country manufacturing liqueurs or gin want to purchase industrial alcohol, there is no reason on earth why they should not purchase it from Ceimící Teoranta instead of from some industrial alcohol distiller outside the country.

Mr. Sweetman

But they do not.

Mr. Lemass

So far as the manufacture of potable spirit is concerned, I want to make it quite clear that the company will be empowered to manufacture potable spirit and will do so if there is a market for the spirit in the future. There is no intention that the company should go into the distillation of whiskey. If there is uneasiness amongst whiskey distillers, as suggested by Senator Sweetman, I do not know on what it is based. It is not merely correct that, before the company can go into any new form of manufacture, notice of intention to license it to do so must be published in the Press: it is also a fact that the Minister cannot give a licence to the company to undertake any new form of manufacture unless he is of opinion that the commodity is not being manufactured in the State by private enterprise. We know that whiskey is being manufactured here by private enterprise and so the Minister could not give a licence to the company to engage in the distillation of whiskey, even if there were any intention of doing so.

On the point, however, of the manufacture of potable spirit, the company has that power at present; and it will have that power in the future. It will undoubtedly be quite willing to sell potable industrial alcohol to other manufacturers who may require it as an industrial raw material for the production of liqueurs, gin or any other alcoholic beverage. There is no advantage being given to other manufacturers by reason of that situation. There is no inducement to people to engage in the production of any alcoholic beverage to a greater extent. The only difference that may develop is that they will obtain their supplies of industrial alcohol from this company rather than from some other company outside the country.

Mr. Sweetman

Will the Minister state what quantity of spirit—and by that I mean patent spirit, spirit produced industrially—has been imported in the last 20 years for manufacturing purposes?

Mr. Lemass

I do not think that any liqueurs were manufactured here until the war period.

Mr. Sweetman

The Minister said gin. The Minister is aware that gin has been produced in Cork—by the Cork Distillers, for example.

Mr. Lemass

Since the war began.

Mr. Sweetman

They distil their own patent spirit. The Cork Distilleries do, in fact, exactly what the Minister is asking that Ceimící Teoranta should do.

Mr. Lemass

There is nothing to prevent that in the future.

Mr. Sweetman

There is this to prevent them from doing so—that it is going to be quite clear that, either this new company is going to take the existing market from them——

Mr. Lemass

For what—for gin?

Mr. Sweetman

For home-produced gin. It is either going to take the existing market from them or else there is going to be an anxiety to increase our spirit-drinking capacity as a people, and I think the Minister will agree with me that that is undesirable.

Mr. Lemass

The Senator misunderstands. There is no intention that this company should produce alcohol except industrial alcohol and while industrial alcohol may be produced as a raw material for manufacturers of gin or other liqueurs, the company itself will not manufacture gin or other liqueurs.

Mr. Sweetman

But the company to which I refer does, in fact, produce industrial alcohol as a basis for potable spirit.

Mr. Lemass

Which company?

Mr. Sweetman

The Cork company.

Mr. Lemass

There will be nothing to prevent them from continuing to do so.

Mr. Sweetman

There will be nothing to prevent them from continuing to do so, but the Minister has already an existing private enterprise and, in spite of the lip service which is paid to private enterprise, he is now going to promote another such company with State resources, to go into competition with existing private enterprise.

Mr. Lemass

I see now where the Senator has misunderstood. So far as the company set up under the 1938 Act is concerned, it was given the right to make industrial alcohol not on a monopoly basis but certainly in competition with any firm which wanted to go into the business of manufacturing the commodity So far as this new company is concerned, it can continue to manufacture industrial alcohol or the products and derivatives of industrial alcohol, even in competition with private enterprise. Anyone who goes into that business knows that this company exists and has distilleries working and will have to consider his prospects in the light of that fact.

The bar upon the expansion of the scope of manufacture by this company, to prevent the granting of licences for that purpose, applies only to chemicals which are being manufactured in the State by private enterprise. The manufacture of industrial alcohol, its products and derivatives, is on a different basis from the manufacture of other chemicals. So far as the first is concerned the company has power to manufacture them now and has power to continue to manufacture them, no matter who else comes into the business. So far as the other products are concerned, the company cannot get a licence to manufacture unless private enterprise is not doing so and is not likely to do so.

Mr. Sweetman

Will the Minister tell us when the old company, set up under the previous Act, put in plant for the purpose of making potable spirit?

Mr. Lemass

I mentioned that when introducing the Bill. The company did not do so before the war at all. During the war, they put up a makeshift plant to produce certain quantities of pure alcohol mainly for the use of hospitals and laboratories. They are now installing a plant of more modern and more efficient design, which will enable them to continue producing undenatured spirit for sale as an industrial raw material, for use in hospitals and laboratories or to any person who wishes to have that type of spirit.

Professor Fearon

With regard to Section 4, I wonder if the objects of the company are set out in the right order. I think a certain amount of confusion and delay in debate can arise from the order they are in at present. Section 4, sub-paragraph (i), says that the first principal object of the company shall be "the manufacture, refining and sale of industrial alcohol and products and derivatives thereof". The second principal object, in sub-paragraph (ii), is "the making, aiding or subsidising of experiments". Then, to my mind, the most important part of the whole business comes in at the tail, in sub-paragraph (iii), "the manufacture and sale of any substance, all or any portion of which is produced or obtained by chemical process".

That seems to me to be by far the most important proposal in the Bill. In that provision, I see really the control of essential industrial chemicals, the most important step towards socialisation of the State that has come to my notice since I was elected to the Seanad. It is very much as if the Labour Government in England were proposing to take over Imperial Chemicals. That is a very big undertaking and should go forward as the first object of the company. It should read that "the principal object of the company shall include the manufacture and sale of any substance", and so on, "including industrial alcohol". The present method of putting industrial alcohol first among the objects has had the effect of delaying the debate, by a kind of post-mortem, an alcoholic post-mortem, on the old company. It has diverted attention from the very wide powers set out in sub-paragraph (iii). I suggest it would be more logical if the principal object were set out specifically, as it is in (iii), "the manufacture and sale of any substance, all or any portion of which is produced or obtained by chemical process, including industrial alcohol", and the second object could be research for the carrying out of those purposes.

In connection with what has been said just previously, I assumed from my reading of the Bill that the industrial alcohol produced could be used for any of these potable purposes. I think the only safeguard the brewers have is by having an exact definition of whiskey as a potable fluid, producing a certificate that it is made in a certain way, as in the case of the basic grape used for manufacturing those extraordinary wines we used to find in confectioners and in the many flavourings and cordials. There are a dozen ways in which potable alcohol is used in medicines prepared by chemists and in sterilising. If we concentrate too much on the alcohol question, it will tend to divert attention from the more important part, the setting up of this chemical company, which can control almost everything that concerns us from the moment we are born until we are embalmed. If not properly used, it will be a tremendous factor in the development of the company that might threaten some of the small concerns. Perhaps some of my Labour colleagues will develop that point. That is a thing which I think was rather overlooked in the alcoholic haze which hung over the Bill in its progress through the House.

Mr. Lemass

The Senator is right in one important respect—as to the main purpose of this Bill. The main purpose of the Bill is to empower this company to manufacture products other than industrial alcohol. We have an organisation for the manufacture of industrial alcohol and it was decided to have an organisation which could spend money on experimentation in respect of, or undertake the manufacture of, other chemicals. It was purely a fortuitous decision that the Industrial Alcohol Company should be used for that purpose instead of creating a fresh and separate organisation. I want to make quite clear that there is nothing in this Bill which proposes to give to Ceimící Teoranta a monopoly in any form. The analogy with nationalisation in Great Britain does not, therefore, apply. The intention is that the company shall not be licensed to undertake chemical manufacture unless that particular form of manufacture is not being done, and is not likely to be done, here by private enterprise. If after the issue of a licence to the company, a private company wishes to go into the business, it is perfectly free to do so.

There is no question of undue advantage to Ceimicí Teoranta as compared with any privately-owned undertaking working on similar lines. It is quite correct to say that the main purpose of this Bill is to give to the existing alcohol company, under a new name, the powers set out in sub-paragraphs (ii) and (iii) of lettered paragraph (c) of this section but it would be incorrect to assume that that is equivalent to the nationalisation of chemical industries elsewhere. It is not intended to be nationalisation and it is not intended that the company should carry on any enterprise on a monopoly basis.

Mr. Sweetman

At the risk of coming back to the alcoholic discussion, I think that we have brought out into the open exactly what is in the mind of the Minister. It is perfectly clear from what he has said that the apprehension which is felt has justification —that, in fact, this company will get into competition with private enterprise. That is what it amounts to. It will get into competition with private enterprise and it does not matter much whether that enterprise existed in 1938 or was started since. The House is fully aware, without my boring it with my views, of the type of governmental company which is to be incorporated here. The House is aware of the views on that subject on these benches and it is also aware of the Minister's view. The only justification of such governmental companies, put forward in debates here, was that such companies were not going to get into competition with private enterprise, that they were only going to do a job which private enterprise was not doing and was not able to do. The best example of that was Bord na Móna. There, the situation was quite clear. There would be no wholesale production of turf except under governmental auspices. That was accepted here. In this case, there has been quite sufficient enterprise to meet the existing demand.

Mr. Lemass

Demand for what?

Mr. Sweetman

The demand for potable spirits pre-war was met to an overwhelming degree by private enterprise. The Minister was not aware of the view I was going to take and, therefore, had not the available figures as to the spirit consumption here pre-war and how much of that was met by native industry, as distinguished from importation. It must be quite clear to everybody that there are only two possibilities. Since the existing demand was already met, that demand will be met in a different way in future; that will take away from the existing production or consumption will have to be increased.

I am grateful to the Minister for having stated his view quite clearly. As we have had the Minister's view stated so explicitly—not the view which I had hoped he would express— I should seek your permission, A Chathaoirligh, on Report Stage, to table an amendment which would mean that we would have this discussion on a net point. My proposal would be to add to Section 4 a proviso: "that the company shall not sell, and will use its best endeavours to prevent the sale of, any potable spirit distilled by it." I submit that, in view of the declaration of policy by the Minister which it was not possible to anticipate, that rather wide amendment would be in order on Report Stage.

Mr. Lemass

I have considerable difficulty in following the Senator's reasoning. If he proposes to raise this matter on Report Stage, he should clarify his own mind, so that he may clarify ours. I think that he is under some misapprehension and, if I could ascertain where the misapprehension lies, it might be of help to the House. I understand that he objects to people drinking gin because there are other people producing whiskey.

Mr. Sweetman

There is a firm producing gin.

Mr. Lemass

Quite. Is the Senator under the impression that the manufacture of whiskey or any other alcoholic beverage is a protected industry?

Mr. Sweetman

No.

Mr. Lemass

If people want to buy gin manufactured by the Dutch, the Swiss or the Portuguese, there is no question of putting any pressure on them to drink Irish whiskey instead. If manufacturers do not want to buy the product of Ceimící Teoranta, they can buy from somebody else. There will be no question of a duty or tariff or preference which would require a native manufacturer to buy the product of this company. So far as the manufacture of industrial alcohol as an industrial raw material is concerned, a person requiring such alcohol for the manufacture of gin, liqueurs, perfumes or any other industrial product can buy from this company or from outside the country as he prefers.

Mr. Sweetman

This company can put up a subsidiary company to complete the manufacture——

Mr. Lemass

This company cannot engage in the manufacture of products other than industrial alcohol and the products and derivatives of industrial alcohol except under the authority of a licence. They cannot get a licence if there are private manufacturers of the products concerned already in the country.

Mr. Kyle

I was rather surprised to hear the Minister limit the activities of the company in the way he has just done. In sub-paragraph (iii) of lettered paragraph (c) the company is empowered to engage in "the manufacture and sale of any substance, all or any portion of which is produced or obtained by chemical process." That would cover a number of things, including artificial silk.

Mr. Lemass

The point I am making is that a licence to manufacture any substance produced by a chemical process cannot be given by the Minister, unless he is of opinion that that product is not being manufactured in the State by private enterprise.

Mr. Kyle

Some of these commodities are not being manufactured in the State. For instance, ordinary table salt is refined in Dublin and packed in Dublin but is not made in Dublin and it can be a chemical process. Iodised table salt for people suffering from goitre is produced by a chemical process, so, as I read this, the Minister could issue a licence to enable this company to manufacture these commodities and, for that reason, I welcome the defining of the principal objects of the company as they have been defined, because, as I say, there is all the raw material for tanning and for what we hope will be the development of plastics in the country. All these are chemical processes and without this power which the Minister seeks now it would be more difficult for manufacturers to establish business in these lines, so that, far from limiting the power, I rather think the House should welcome proposals for development even on the basis of State enterprise. I have none of these predilections for private enterprise that some of my colleagues here have. I do not know that it has shown the great desire to furnish the needs of the community at a reasonable price which some of my colleagues think it has, and, from that point of view, if the State is prepared to set up a company for the manufacture and sale of any substance, all or any portion of which is produced or obtained by chemical process which will be for the benefit of the nation, the Seanad should welcome it.

Sir John Keane

Increased responsibility will undoubtedly be thrown on the Minister in the administration of this Act and in deciding very technical points as to what is an established industry in relation to some development of a product which that industry is already making. I have in mind plastics, an industry which is expanding and changing every day. We might reach a stage at which the company would say: "This new development in plastics is not being made by an existing private organisation" and the Minister would be in a very difficult position in coming to a just decision on points of that kind. In view of all that, will he consider reviving the advisory body he took powers to create under the Principal Act? Has that body ever come into existence at all? If the Minister had in mind at that time that it might become useful, surely it should be of increasing utility now, and would he now say that he intends to constitute, or to reconstitute, that body and to put on it persons who are in a position to advise him on the difficult and rather technical points with which he will be faced in the future?

Mr. Sweetman

The Minister suggested that I ought to make my mind clear. The trouble is that my mind is clear, but, with great respect, the Minister's mind is not. The Minister made considerable reference to Section 7. Possibly Senator Foran has read it and may be in a position to comment on the interpretation of it, but we will hear that in a minute. The Minister refers to his powers under Section 7. If we look at Section 5 in Part III, we find that the expression "manufacturing (chemical product) licence", means a licence granted under Section 7. Does the Minister suggest that those words cover not only the third paragraph of clause (c) in Section 4 but also the first two?

Mr. Lemass

They do not.

Mr. Sweetman

I suggest that they do not.

Mr. Lemass

I have said that they do not.

Mr. Sweetman

Therefore, what the Minister has to get in Section 7 is a licence purely for a chemical product. A chemical product is not a derivative or a product of industrial alcohol as qualified in the first paragraph of clause (c) and therefore the discussion in regard to potable spirit cannot be brought in under the licence.

Mr. Lemass

Sub-paragraph (1) of (c) of Section 4 defines the powers which the company has now. These powers are not being altered so far as industrial alcohol is concerned.

Mr. Sweetman

The existing powers are included in the Schedule to the Principal Act. I take it the Minister agrees with me in that. Clause (2) of the Schedule says: "The Memorandum of Association of the Company shall provide... (c) that the principal objects of the company shall include the manufacture and sale of industrial alcohol". The sentence in the Bill before us on which the Minister depends is: "The manufacture, refining"—"refining" is not in the original Bill —"and sale of industrial alcohol and products and derivatives thereof". The last few words are not in the original Bill.

Mr. Lemass

But in fact a commonsense interpretation of what is in the original Act is the same thing. It has these powers and has used these powers.

Mr. Foran

I want to get a little enlightenment. Would the manufacture and sale of cement come under the heading of a chemical process?

Mr. Lemass

I think it would. I think the manufacture of cement would be described as a chemical process.

Mr. Foran

I am glad to have that from the Minister because I can now understand Senator Sir John Keane's worry.

Mr. Baxter

The point raised by Senator Sweetman is one on which the House has very little information and I am trying to get clear in my mind what exactly are the powers of the Minister under this section and what are Senator Sweetman's fears. I should like to know whether I am correct or not in my interpretation. It seems to me that the position at present is that certain alcoholic beverages are being manufactured here, the basis of these finished products apparently being a raw material which the Industrial Alcohol Company can produce.

Mr. Lemass

Alcoholic beverages being produced here, such as whiskey, stout, and beer——

Mr. Baxter

I am speaking of gin. The company can produce the basis of it and apparently somebody else can produce it because it is being produced at present. Whether we are able to produce all the raw material necessary for the production of the quantity of gin or such like beverages that we require or not is something on which I am not clear; but if at the moment we are able to produce the raw alcohol which is the basis of this product, it does seem that there is point in what Senator Sweetman is pressing on the Minister, because it does seem unfair that a new State company, financed by all the taxpayers, is to be put into a position to produce a raw material which is already being produced by somebody else in the country. If the position is that the Cork Distilling Company—and I know nothing about them—are, for their own purposes, producing this alcohol in sufficient quantities—if they are producing for somebody else or if anybody is producing some for himself and some for somebody else—and are to come into competition with this new State enterprise, there is, in my opinion, point in Senator Sweetman's case. If that is not the position, then we are confronted with something different from that. I take the view—and I am not very narrow or intolerant about the efforts of the State—that nobody else will make the effort. At the same time I am not anything like as enthusiastic as Senator Kyle might perhaps be. We will have to wait until we see what the coal miners are going to do, and whether they will give us more coal than our own people have been able to give us in the matter of turf. All these things are governed by circumstances over which men have no control. I think myself that if we have small industries producing the raw materials necessary for themselves, as well as for some others engaged in the same industry, that it is not justifiable for the State to come in and wipe them out.

Mr. Lemass

I do not quite follow the Senator's argument. If, before the war, anybody had engaged in the manufacture of gin or liqueurs or perfumes, or certain other industrial products, they would have required industrial alcohol and would have imported it. There were, in fact, no such manufactures carried on on any large scale and, consequently, it is a purely hypothetical situation that we are dealing with. The Industrial Alcohol Company was started in 1938. Since the outbreak of the war, some firms here have engaged in the production of gin which requires industrial alcohol. Its manufacture was begun here by firms who were fully aware of the existence of the Industrial Alcohol Company. They would, presumably, have purchased the undenatured alcohol made by that company if the company was in a position to sell it. The company was not in a position to sell it. I do not know if the suggestion is that the Cork company should have a monopoly in gin production. What is certain is that no injury is being done to that company or to anybody else. The company will require the undenatured spirit for the manufacture of gin and it can either buy it from this company or import it. If people engage in the production of liqueurs they also will be in the position that will require industrial alcohol. They also can produce it themselves, subject to the requirements of the Revenue Commissioners, or they can buy it from this company or import it. Anybody else engaged in any other form of manufacture for which industrial alcohol is required will be in the same position. No injury is being done to them.

The only possibility of injury arising would be if this company itself were to engage in the business of manufacturing consumers' goods which other firms may produce. It is not intended that the company should do that. The company will produce industrial alcohol and certain derivatives of industrial alcohol and sell it for industrial purposes to people who are going to use that industrial raw material to producers of other goods, whether those people are in this country or outside of it. The users of industrial alcohol will not be confined to this company for their supplies from it. Neither will this company be confined to this country in seeking customers. I hope it will be able to produce a very much better and cheaper alcohol than other firms can do, and that it will be the ordinary practice for other firms to buy their supplies from this company rather than make it themselves.

Mr. P.J. O'Reilly

It seems to me that paragraph (c) of sub-section (3) is very wide. I want to suggest that perhaps the two points of view that have been expressed in regard to the interpretation of it might be reconciled. The Minister says that if something is being already manufactured this company will not, and cannot, undertake the manufacture of a similar substance, but it is characteristic of the present day, in view of the rapid advances that we are witnessing, that new substances may be required. The Minister may notice that one or more of these are not being made here and he may authorise the company to make them. My suggestion is that the Minister might see his way to give an undertaking—the undertaking to be included in the Bill—that before the company undertakes the manufacture of a particular substance that some form of reasonable notice will be given, because it might conceivably happen that a group of people will be contemplating its manufacture. Their plans for its manufacture might not have matured, but certainly the Minister could precipitate matters by authorising this company to go ahead with its manufacture. If that happened it would mean that private enterprise was not getting a reasonable chance.

Naturally, there is a difference between Senator Kyle and Senator Sweetman on the matter of different ideologies. One naturally favours State enterprise in its fullest degree. The other favours private enterprise, and, of course, the Minister himself, on a recent occasion, seemed to suggest that private enterprise was the sounder policy of the two. Therefore I suggest that the two points of view might be reconciled in the way that I have mentioned, namely, that the Minister would give an undertaking that the company, before it entered on the manufacture of a new substance, would give reasonable public notice to all concerned. Of course, if the people contemplating its manufacture did not go ahead with their plans, then the Minister would be at liberty to allow this company to do so.

Mr. Sweetman

I do not want to delay the House further on this. The matter can be cleared up on the amendment which I intend to submit for the Report Stage. The Minister, on an earlier Stage suggested, that before a company could manufacture potable spirit it would have to get a licence, and that it could not do that if, under the licence, it was competing with private enterprise. I take it the Minister agrees that, in fact, would not be a chemical process at all, and that the licence only refers to chemical processes.

Mr. Lemass

The company is only empowered to undertake chemical processes.

Mr. Sweetman

I want to get the issue between myself and the Minister knit. If the Minister's view be that the company is only empowered to undertake chemical processes, then it is easy to see where he and I differ. In my view the company under paragraph (c) of sub-section (3) is entitled to undertake chemical processes. That entitlement is exclusive of the first two paragraphs in the sub-section. The Minister will have ample opportunity between now and the Report Stage of consulting his legal advisers as to whether his determination of the procedure is correct, or whether the doubt that I throw on it has any justification or not.

So far as the other difficulty that was raised is concerned, that is a matter that can be dealt with more fully on the Report Stage. I want to put this danger before the Minister. If this company is going to produce potable spirit and is going to sell it to anybody that wants to buy it, there is the gravest danger that potable spirit will be manufactured and sold abroad as Irish whiskey.

Mr. Lemass

Someone selling alcohol as whiskey? The person who did not know the difference between the two would certainly be a poor judge.

Mr. Sweetman

What about Scotch whiskey?

Mr. Lemass

It is not produced from potatoes. Bad and all as it is, I would not allege that against it.

Mr. Sweetman

I agree with Senator O'Dea that it is not comparable to pot-still. In fact, Scotch whiskey is produced by exactly the same process as that by which the Minister's company will produce industrial alcohol. It is refined alcohol used with certain blends of pot-still whiskey to give it a different flavouring.

Mr. Lemass

The Industrial Alcohol Company produce nothing else but potable spirit, but the Revenue Commissioners require that before it is sold to the petrol distributors for use as a motor fuel, it must be denatured. The product of the distillery is a potable spirit, but it has to be denatured before it can be used in the ordinary way.

Sir John Keane

I should like to have an opportunity of going into this matter at closer quarters on the Report Stage. I am afraid I cannot see eye to eye with the Senator in his apprehensions. I feel that, in a progressive community, if any people like to start a distillery in order to make whiskey by the pot-still method, there should be no objection. The pot-still method is well known. It would be wrong to restrict any form of enterprise of that character. If anyone wants to make whiskey, it would be wrong for the Government or anybody else to prevent him.

I wish to make some brief remarks with reference to what Senator Foran said. It might, perhaps, be more dignified to let his remarks pass in scornful silence, but I strongly resent any Senator attributing motives of self-interest in this matter. I never mentioned the Cement Company, but the Senator dragged it in presumably because I may be a director or a shareholder. I suggest it is against Parliamentary good taste to make insinuations which imply that people are not actuated by motives of public interest in these matters, but are influenced by some special interest they may have in certain enterprises.

Mr. Sweetman

The Senator is very foolish to take Senator Foran seriously in this matter, or in regard to anything else.

Sections 4, 5 and 6 put and agreed to.

SECTION 7.

Question proposed: "That Section 7 stand part of the Bill."

Mr. O'Dea

Section 7 sets out:—

(1) Whenever the Minister is of opinion that—

(a) a particular chemical product to which this section applies either—

(i) is not being manufactured in the State by means of private enterprise, or

(ii) is not being manufactured to a substantial extent in the State by means of private enterprise.

the Minister then may grant to the company a licence authorising the company to manufacture such chemical product. I think paragraph (i) is very wide. "Is not being manufactured in the State by means of private enterprise"—does that mean that if it is manufactured at all by a private person, even to a very small extent, it will prevent the Minister granting a licence? I suggest the Minister should leave out paragraph (i). He is tying himself down very much by that paragraph. If anyone is manufacturing a particular chemical product, if he has only one room in his house and one employee, then the Minister cannot grant a licence. I suggest the Minister should leave out paragraph (i), begin with paragraph (ii) and continue with paragraph (b) which says: "It is desirable that such chemical product should be manufactured in the State to a substantial extent."

Mr. Lemass

I do not think it is important whether it is there or not, but I suggest the meaning is quite clear. Where the Minister is of opinion that a particular product is not being manufactured in the State, or is not being manufactured to a substantial extent and that it is worth while doing it, then he issues the licence.

Mr. O'Dea

I am afraid it would not be practicable with that paragraph in the section. The Minister will tie himself down very badly by leaving the paragraph in. I hope he will not.

Professor Fearon

There is no provision in the Bill for revoking a licence when it is granted. I think it would be desirable that the Minister should have power to revoke a licence in case the company made a hash of the process. He should have power to take the licence from them. There should be some such provision.

Mr. Lemass

If a licence is issued to manufacture a certain product, the Minister should not have arbitrary power to revoke that licence. The company, once it is licensed to undertake a particular process, should be allowed to do so. It may not exercise all its powers under a licence. If it makes a hash of the process, then someone may do the job better. It is not desirable that the Minister should withdraw the licence and leave a company with plant and equipment that could no longer be utilised.

Mr. Sweetman

Sub-section (4) of this section throws light on the discussion we had on Section 4 as to the various products.

Mr. Lemass

I think it is abundantly clear that the manufacture of industrial alcohol products stands in a different position from the manufacture of other chemicals. The company has full power and it requires no new legislation. Its power has not been extended. The form used in the original Act has been interpreted to have the same meaning as the form used here. It is better to have it as specific as possible. The company has full power to manufacture now, no matter who may be manufacturing similar products. So far as products other than industrial alcohol products are concerned, the company cannot engage in manufacture without a licence.

Mr. Sweetman

That is as I read the Act, but it is not as I heard the Minister explain it in the earlier part. I do not agree with the Minister that the company is not getting further power. In my view the additional words give it further power.

Mr. S. O'Donovan

I believe that the term "chemical product" is very wide. It may be difficult to get a definition, but I suggest the insertion of some definition of "chemical product". I presume what is meant is anything that takes place through the implementation of chemical apparatus. Every change entails a chemical process.

Mr. Lemass

I would not agree that manufacturing a pair of boots from leather involves a chemical process. There are obvious difficulties in getting a closer definition.

Mr. S. O'Donovan

The manufacture of leather is a chemical process.

Mr. Lemass

The manufacture of tanning materials is very important.

Mr. S. O'Donovan

It is a very wide definition. I wonder if it is necessary to restrict it, because somebody may say that such and such a thing is not produced by a chemical process, whereas others will say that it is a chemical process. "Chemical process" is very wide in its interpretation.

Mr. Lemass

I would rather have it too wide than too restrictive.

Question put and agreed to.

SECTION 8.

Professor Johnston

I move amendment No. 1:—

To add at the end of sub-section (4) the following words:

"The Minister shall under the terms of this sub-section issue a licence for the import free of duty of any chemical product which is used as an agricultural raw material in all cases where the corresponding product of domestic manufacture is available only at a higher price."

This amendment is based on the fact that all our industrial development is directly or indirectly based on agricultural productive and export capacity. I hope to illustrate that point in various ways by way of providing a background leading up to the putting of this amendment. In doing so, I may refer briefly to some of the things that were said by the Minister and myself in the course of the Second Reading debate. I think the Minister said that there were some people who had learned nothing and, presumably, forgotten nothing in the last 25 years. I do not know whether he included me in that category or not. I assure the Minister that I have learned a good deal in the course of the last 25 years. I readily admit that I learned quite a lot even from the Minister, not only from his words, but from his actions. It is quite possible that, to some extent, I have moved somewhat nearer his position in matters economic, and I should like to be assured that he has moved a little bit nearer to mine. On that point, I think the evidence is not by any means conclusive.

May I illustrate my contention that our industrial development can only proceed on a sure and sound basis if it is based on agricultural productive and export capacity by some reference both to the past and to the present? I agree with the Minister that our agriculture of the 'thirties suffered very serious blows, in the first instance, from the effects of the world economic depression and, in the second place, from the effects of the economic war. I myself was terribly worried at the time about the possible effects of that disaster on our whole economy. I think it was certainly regrettable from every point of view that the Minister had to initiate his industrial development at a time when our agriculture was suffering severe depression and I am sure he would agree that it would have been better in every respect if agriculture had been flourishing in 1932, when it was depressed, at the time when he introduced his new industrial policy.

If I might speak in a somewhat picturesque way, I thought that 15 years ago, when the cold waters of the economic war closed over Kathleen Ni Houlihan, that she had found a watery grave and that if there had been a coroner's inquest it would probably have returned a verdict of economic asphyxia due to prolonged immersion in the economic war. Things turned out to be not so bad as I had feared. I readily admit that the energetic manner in which the Minister threw himself heart and soul into a policy of vigorous industrial development did something to alleviate the misfortunes which otherwise our national economy as a whole must have suffered. I have nothing but admiration for the dynamic energy he displayed in that capacity. But it was an awful pity that it was necessary to throw Kathleen Ni Houlihan into the water in order that the Minister should effect an heroic rescue.

Mr. Baxter

She is not rescued yet.

Professor Johnston

I do not know whether the Minister is what I might call a P.G. Wodehouse fan or not. At all events, they share a common interest in the royal and ancient game of golf, or should I say the republican and ancient game of golf. But there is a Wodehouse story in which the hero desired to make contact with a rather attractive girl. The difficulty was that her father had no use for this fellow. It occurred to the hero that it would be a good idea if he could do something heroic which would win the good graces of the girl's father. The girl's father was in the habit of sea fishing every day in a boat propelled by a somewhat alcoholic boatman. Our hero proceeded to bribe the boatman to upset the boat while he himself stood by and was able to effect a most heroic rescue of the old man after he had been dipped in the sea. That worked out all right for the time being, but only for the time being, because the boatman in his cups "blew the gaff" and the story came round to the old man who was very indignant and the hero was thoroughly discredited. The Minister has gone several degrees better than that Wodehouse hero, because he and his Party have been living successfully on the prestige of that rescue of Kathleen Ni Houlihan for the last 15 years and, so far as I can see, are likely to continue doing so for another 10 or 15 years.

Mr. McCabe

Are the economic war or matters of that kind in order?

An Cathaoirleach

The Senator is leading up to the amendment.

Mr. Quirke

Could we have any indication as to when the story will end?

Professor Johnston

I know that a reference to the economic war is like a red rag to a bull to some people. I do not enjoy raking over the embers of dead controversies, but there are some things that ought to be said, even if certain people are annoyed by having to listen to them. Even the economic war illustrated the dependence of industrial development on our agricultural productive and export capacity. I remember having some conversation with one of the more distinguished foreign members of our Banking Commission and he stated that the one thing that saved Ireland during the economic war was the fact that Ireland alone among European countries was a country in which the farmers kept the profits that they made during the first world war. These profits took the form of a large accumulation of sterling balances, and the industrial development which proceeded during the 'thirties was based financially on withdrawing a lot of the sterling balances, which could not have been withdrawn if they had not been there, and they would not have been there but for the former productive and export capacity of our agriculture. To that extent, it is true to say that industrial development must fundamentally depend on agricultural productive and export capacity; otherwise our fate would have been similar to that of other less financially sound countries, like New Zealand and Australia, who differed from us inasmuch as they owed a lot of sterling and owned very little. They had to let go their monetary standard and to reduce the value of their national monetary unit because of the financial difficulty in which they found themselves during the 'thirties, while we carried on without any monetary shocks or disturbances precisely because of the strong monetary and currency position which we enjoyed. That was due ultimately to the strength of our agricultural export capacity.

I should not like the House or the Minister to think that I am utterly opposed to any form of industrial development. On the contrary, I think many of the new industries which have been successfully established during the present régime were well established and are likely to become a prominent and desirable part of our national economy, but I should like to put it to the Minister and to the House that the right point of view in all these matters is not either industry or agriculture but the welfare of the national economy as a whole, and that our principal aim should be to increase the national income in every legitimate way, whether that takes the form of technically agricultural or technically industrial development.

Of all the forms of industrial development, the ones that most command my sympathy are those which have the effect of complementing and completing our existing agricultural structure. The manufacture of bacon is an industrial process but it is also a processing of an agricultural product. Even the textile industry, in so far as it is based on native wool or native flax, is a processing of available agricultural products. All that tends to strengthen the national economy as a whole and to create a close relationship between agriculture and industry. That kind of industrial development commands my utmost sympathy. Even the cement industry might be approved of from that point of view because it is based largely on native raw materials and it has got a constructive relationship to our main agricultural structure because cement is so useful in many ways to any progressive farmer. It has been a matter of great satisfaction that cement was available all through the recent war period when so many other things were almost unobtainable. It was a curious phenomenon, in fact, that when coal could be obtained for no other purpose, coal was nevertheless available for the cement works and it was not without the knowledge of local people that a high proportion of the cement produced during the last six years was exported to Northern Ireland, thereby making a benevolently neutral contribution to Britain's war effort. However, one suspected that there was some relationship of cause and effect between the fact that the cement industry could import coal and the fact that the cement industry exported cement during those years.

Another industry which is based on native raw materials is, of course, electric current and I think we ought to realise that the Minister's industrial programme has been as successful as it has been largely because there was this very well thought out and comprehensive system of electric current available throughout the whole country. To give credit where credit is due, I am sure the Minister will admit that in that respect his predecessors in office laid the foundation which his Party in office were very willing to build on and, to that extent, our industrial development is on a sound basis.

I do not wish to delay the House too long on this part but I should like to say that there are other industries which are not quite so well founded. They belong to the category of what are vulgarly known as "spit and polish" industries and are objectionable to me in so far as they tend——

An Cathaoirleach

I must interrupt the Senator to say that he should come to the amendment.

Professor Johnston

I am coming to it. They tend either to add to the cost of living or to the cost of production of other industries. In a sense, even this kind of industry is based on agricultural export capacity because they often depend on imported raw materials and unless we can export agricultural produce we cannot afford in the long run to import these necessary industrial raw materials. In so far as any such industry has the effect of increasing agricultural costs, it diminishes agricultural productive capacity and, therefore, agricultural export capacity and, therefore, since they depend so much on being able to import raw materials that only agricultural exports can buy, such industries have the effect of sawing off the branch of the tree on which they themselves are sitting.

This particular amendment is related to the possibility that there might be under this Bill something in the nature of a sulphate of ammonia factory established in Ireland. I should like to see something of the kind established and successfully working, but I would not like to see sulphate of ammonia being produced and sold to Irish farmers at a price substantially higher than that at which sulphate of ammonia could be obtained by import, because that would have the direct effect of increasing the cost of production in our major industry. Consequently, this amendment is drawn up in such a way that if any such factory—and I merely take sulphate of ammonia as an example— can only produce and sell its product, an agricultural raw material, at a price higher than the imported product, the Minister should necessarily issue a licence for the import free of duty of the corresponding product from abroad. In other words, do what you like within limits about industrial development but do not encourage any form of industrial development that would make any serious addition to the cost of agricultural production.

Mr. Hawkins

I do not wish to take up the time of the House but I would ask your permission to make one or two suggestions. On a number of occasions when we have come to consider various Bills, we have had discussions on the economic war, on Government industrial policy, on agricultural policy in general. Those discussions have been on the lines adopted by the last speaker, sometimes by the mere putting down of an amendment to a particular section of a Bill. With your permission, I would suggest that if those people desire to have a discussion on the various aspects of Government policy, on the economic war, the industrial policy or the agricultural policy, a particular time should be devoted to such discussions and after that we might get on with the ordinary work of giving due consideration to the amendments and Bills that come before the House.

Professor Johnston

I would not have mentioned the economic war if it were not for the fact that the Minister referred to it in his Second Reading speech.

Mr. Baxter

What is wrong with referring to the economic war?

Mr. Hawkins

I do not object.

Mr. Baxter

People cannot be as squeamish as that about the past.

Mr. Hawkins

We are not squeamish about the part we played in the economic war, but certainly those people who took other action in that particular period should be squeamish.

Mr. Baxter

Not a bit. Will we go back, as Senator Hawkins desires?

An Cathaoirleach

We cannot allow this to develop.

Mr. Baxter

Those who want to get on with the work do not want to go back.

An Cathaoirleach

Would the Senator deal with the amendment before the House?

Mr. Baxter

I hope I am not far out of order yet. I come to the net point covered by Senator Johnston's amendment to which, if I may say so, Senator Hawkins made no allusion whatever and who, accordingly, was completely out of order. I support the general principles embodied in Senator Johnston's amendment, for this reason: in the first place, I am sure somebody else will get up and say: Why would not the farmers be enthusiastic about the creation of a chemical industry here which would supply them with raw materials of agricultural production? I say: Why would not they? As far as I am concerned, I do not take the point of view that such an industry should not be created here. In fact, I believe it should be. I am quite definite in saying that we must make the best effort we can to provide ourselves with the necessary raw materials for our existence. In so far as the Minister is doing that by this Bill, he is getting the powers, but this point has to be considered and this is the point that Senator Johnston was attempting to make. Farmers here dispose of their products in various ways. The people here consume many of the products and they sell the balance. We will go on doing that in future, I presume. Over the price the farmer gets for the commodities consumed at home we have some control, but when it comes to the export of agricultural goods, unless our Government can make satisfactory bargains with the people to whom we have to sell, apparently, the ordinary law of supply and demand, about which some people are very enthusiastic but about which I am not too enthusiastic, is the deciding factor in the price the farmer gets in the outside market.

A chemical industry can supply a commodity which will have the effect of increasing the farmer's productivity but the Irish farmer is not the only farmer in the world availing of supplies of chemical industries. If we have to get into the outside market with beef, butter, eggs or anything else that, to a certain extent, are the results of the application of chemical fertilisers to our land, we have to remember that the costs of production are a determining factor in the price at which we can sell and if the chemical fertilisers of the Dane, the Canadian, the New Zealander or the Australian are sold at a lower price than those which the Irish farmer can buy, the Irish farmer is going to be handicapped in the sale of his butter, bacon, beef or whatever the product may be in the sale of which he comes into competition with the other fellow. Senator Johnston wants to ensure that where any of these chemical fertilisers are available outside at a price lower than the price of chemical fertilisers at home, a licence shall be issued to enable the commodity to be imported duty free here. What he wants to get an assurance on is that the Irish farmer will not have to pay more for his chemical fertiliser, if we have a chemical industry here, than the farmer elsewhere against whom he has to compete. If we are placed in that position, a definite handicap is put on our export effort.

On the other hand I see this aspect. What is the point of our establishing a chemical industry here unless the farmers of the country avail of the product of that industry and buy it? We shall have to face that situation and we ought to face it now. I think it is an aspect of the problem on which the Minister should be quite clear and definite. In so far as we have to pay a higher price for the chemical product manufactured at home than we should have to pay for the imported product, we are going to be at a disadvantage in meeting our competitors in the outside market. What Senator Johnston wants is to be able to import fertilisers duty free in certain circumstances.

There is one other way of dealing with the matter and it is this. The whole purpose of our exports is to maintain a balance in our national life. The export of agricultural products enables us to import certain industrial products. It would probably be the means of providing us with the exchange to import certain raw materials that might be essential for utilisation in a chemical industry. So it seems to me the Minister is up against this: he must ensure, if agricultural products in future are to be the medium by which we are to procure exchange, that the farmer gets a fair deal and that the internal industrial revival is not going unnecessarily to handicap the Irish farmer in his productive effort.

If we are to buy the products of the home industry at a higher price than that at which we could procure the foreign product, there is one other way in which the account could be balanced. That is by the Minister recognising that, in so far as the price of the home product is much higher than the price of the foreign product, when we come to export our agricultural products there will be a necessity, in order to help us to compete against outsiders, to subsidise exports. That is the position in which the Minister is going to be placed in so far as he is the person organising the manufacture of industrial fertilisers. I think, however anxious farmers may be to procure chemical fertilisers—and I know they are anxious; I am very anxious about it myself—the time will come when it will be the desire of farmers everywhere to get their raw materials at the lowest possible price. If the price of Irish raw materials is higher than the price of the product of say Imperial Chemicals in the Twenty-Six Counties, there will be a continuance of this smuggling in which we are so terribly interested. I think, on principle, the Minister should accept this amendment. The least we can expect from the Minister is a definite assurance that whatever may be the outcome of the effort to organise a chemical fertiliser industry here, it is not going to be any handicap whatever on the productive effort of the farmer by increasing his costs above what they would be if he had a free market to procure fertilisers on the most advantageous terms.

Liam Ó Buachalla

I do not intend to detain the House very long. I should like to say at once that I consider the amendment moved by Senator Johnston as one of a very sinister type. Senator Johnston's speech on the amendment itself might be described as amusing but it will be admitted that by the amendment and the speech of the Senator, an opportunity has been provided for a discussion of a very wide character, if we cared to indulge in it. For myself, I may say that I do not intend to indulge in any such discussion. It seems to me that Senator Johnston drafted this amendment very hurriedly, handed it in and left it at that because it is clear that the effect of the amendment would be that this company could not engage in any branch of production and continue in it for any length of time. The amendment declares, that whenever the price of the foreign product is lower than the price of a similar product made available by Ceimící Teoranta, the Minister must allow the foreign product in free of duty. The effect of the amendment would be that if any outside company desired to smash any undertaking engaged in by Ceimící Teoranta, it has nothing to do but to reduce its prices for a certain period.

Senator Johnston and Senator Baxter must be aware of the attempts made by outside companies ten or 12 years ago, when this country started its industrial revival. They must be aware of the attempts, made through the process known as dumping, to prevent these Irish industries ever getting under way at all. Is it not clear from the wording of this amendment, that if any outside company desires to check the development of industry engaged in by Ceimící Teoranta, it has nothing to do but adopt the policy adopted ten or 12 years ago by those outside companies, in other words, reduce the prices for three or four months and in that way drive this company out of production altogether? The Senator has given the Minister no chance. He says: "The Minister shall", under the terms of this sub-section, issue the licence. That is the objection to the amendment. It would make it impossible for this company to function. It would make it impossible for Ceimící Teoranta to do any one of the things we hope it will do, and do successfully.

It seems to me that Senator Johnston also was hardly fair in putting down this amendment. If he had read the section, and especially sub-sections (4) and (5), he would have seen that the powers to protect the agricultural industry or any other industry are there given specifically to the Minister and to the House. In sub-section (4), it is clear that the Minister has the power to apply a brake to the activities of Ceimící Teoranta, if he thinks they are not working efficiently or that their prices are unduly high and likely to affect unfairly the agricultural industry—or any other industry, for that matter.

Professor Johnston

To what section is the Senator referring?

Liam Ó Buachalla

To sub-section (4) of Section 8. Again, under sub-section (5), it is clear that whenever the Minister makes an Order under this section, the Order must come before the House for discussion. In view of these two sub-sections, it seems to me that Senator Johnston did not render the House or render agriculture any service whatever by putting down this amendment and by delaying us in the way he did delay us in discussing it.

Mr. Summerfield

When I listened to Senator Johnston introducing this amendment, I could not help feeling that the lessons of the recent emergency period are rapidly being forgotten. We have dangled up before us a certain bogey—he quoted a golf one, but I will quote another one—it is: "As good, and as cheap also". The object of the amendment is clearly that anything in this country shall not be used unless it is so made that it is as cheap as anything which can be brought in from anywhere outside. Surely a man of Senator Johnston's calibre knows that, in the past as it will be in the future, if imports are allowed in duty free there is no guarantee that the goods will be sold here—whether fertilisers or anything else—on an economic basis. They will be sold at the prices dictated by the domestic policies arranged abroad by those larger concerns under which these manufacturers operate.

One thing I want to stress is that, when an article is made in this country, if the price has to be a little bit higher than that of a similar article imported, the labour content is made up by Irish people. If the factory or series of factories proposed under this Bill engage in this work here, then work will be found for farmers' sons who otherwise would have no outlet but the emigrant ship. Another of the lessons of the economic war period is that price was not always the most important factor, it was the availability of supplies at any price. I have never rushed in on agricultural problems— although I notice that the farmers do not hesitate to discuss industrial ones —but I am wondering whether the well-known impoverishment of our land today would be the degree of impoverishment that it is, if there had been healthy fertiliser factories in the country producing all the chemical fertilisers this country would need. I think that is a fairly pertinent question.

There is something sinister in an amendment of this kind, by reason of its implication. The wording is clear: it is a long time since anything was so clear. We must not buy anything Irish if the cost is, in no matter what degree, higher than that of the imported article. We have heard people say that Cathleen Ní Houliháin has been for 25 years floundering in the waters of her industrial rebirth. We are told that she has not yet reached the shore. I am one of the many who feel that she has long ago reached the shore and is well dried now. I am looking forward to an expansion of our industrial programme, but it still seems to worry certain people. I hope the amendment will be rejected.

Mr. O'Dea

I do not know if Senator Johnston read the first sub-section of Section 8. It provides that the Minister may make an Order prohibiting the importation of an article save under licence. The first question we have to ask ourselves is this: is the Minister likely to make an Order prohibiting the importation of fertilisers used by agriculturists, while at the present moment he is engaged, and has been for a long time engaged, in endeavouring to get in certain allowances of sulphate of ammonia, nitrogen and other component parts of the manures for agriculture? He finds it very difficult to do so, as there are certain quotas given to different countries and he cannot exceed the quota allowed to this country. He has a very difficult proposition, but now it is suggested, in face of that proposition, that this Minister or any Minister succeeding him will attempt to make an Order prohibiting the importation of a substance used for manuring the land.

Professor Johnston

What about 1932? In point of fact, was such an Order not made in 1932 about phosphates from abroad? In 1932, the importation of Belgian phosphates was prohibited.

Mr. O'Dea

I am quite sure that, if it was ever made, there was a very good reason for it and that in 1932 the material was not required. It is required now. If it is required, as is the case at the moment, it is ridiculous to suggest that the Minister would make an Order prohibiting its importation. If he did make such an Order, it would have to be laid before both Houses, as Senator Ó Buachalla has said; and the very name of the Order would make people read it and inquire what it was about, so there would be an outcry if ever such an Order were made. The whole idea is absurd and ridiculous. Secondly, there is the idea that, even then, the Minister would not grant a licence. Of course he would grant a licence. However, the Order would not be made in the first place, so no licence would be necessary.

This amendment uses the word "shall". It is very seldom in legislation that that word is applied to a Minister. You give a Minister power and put in the word "may". The word "shall" means that he must do a certain thing, and here it is a presumption that this Minister, or any other Minister succeeding him, would be neglectful of the interests of the farmers. The whole thing is ridiculous. I suggest that this amendment should not be accepted and that it should not be pressed.

Sir John Keane

I support the spirit of this amendment. The Minister will agree that, for the purpose of a sound economy, it is important to keep the costs of agricultural production down to the lowest possible figure. After all, it represents virtually the only export by which we can balance our trade. The Minister, while accepting that, urges that we must have due regard to a certain measure of industrial development. There, I agree. There have been industrial developments here, based mainly on raw materials within the country, which are highly desirable. I should like to get nearer the question than the histrionics of Senator Summerfield, who argues that, if you did this, you would have nothing Irish. That sort of argument does not get you anywhere. Take a specific case. In our national economy, would it be better to put 5/- a time on sulphate of ammonia or to deny the employment afforded to whatever the number of industrial workers is involved? I would unhesitatingly say that keeping the costs of the farmers' raw material to the lowest possible level is all-important but every case has to be decided on its merits.

I should like the Minister to say that he has in mind, in the administration of the Act, some means of protecting the agricultural producer. I cannot believe that, in his inmost thoughts, he is happy about the effect that a measure of this kind may have on our national economy. Is Senator O'Dea or Senator Ó Buachalla serious in suggesting that the Order affords any protection? An Order is made, giving the company the right to produce, say, sulphate of ammonia. At that stage, there is not knowledge of the cost. It is not until the manufacture will have taken place that the burden to be placed on agriculture will be known. Then it is too late.

That is the difficulty. The position would be different if this were a private company which did not enjoy those special privileges. There is no more assurance that every public institution will be managed efficiently than there is that every private concern will be managed inefficiently. The difficulty is that the Government's prestige is involved in the case of an inefficiently-managed Government company and it is kept alive. If it were a private concern, it would go into bankruptcy—the right place for it. I hope the Minister will say that he is concerned regarding the effect of the price of chemical products used as the raw material for agriculture and that he has in mind some means to protect our primary producers.

Mr. Foran

I sincerely hope the House will reject this amendment. We are very fortunate in having a very efficient fertiliser industry, which goes a long way towards meeting our agricultural requirements. It is not an industry of yesterday. It goes back for 100 years. I have been fairly closely associated with it for over 50 years. I remember when the industry was family owned. During the British régime, it had to meet competition from abroad and it weathered it. The conditions of the people employed in it were not what they should be because of that competition from abroad. With the advent of an Irish Government, this was rectified, and I think we owe some gratitude to this industry for the manner in which it served the people during the emergency. Things would have been very much worse if we had not had this organisation already established. Senator Johnston referred, on the Second Reading, to the employment of a "miserable" or "beggarly" 1,000 persons. These 1,000 persons find lucrative employment in this industry.

Professor Johnston

I did not use the word "miserable" or "beggarly."

Mr. Foran

You spoke in a very disparaging manner of the number employed. I read the report and that is the impression I gathered from your remarks. These people are in reasonably good employment. They have fair employers.

Mr. Baxter

On a point of order, this has nothing whatever to do with the amendment nor has it anything to do with anything contained in the Bill.

Mr. Foran

If the Senator cannot see the connection, I shall not try to convince him. If we are to open the flood-gates and permit dumping, then the industry will go. That is what Senator Johnston means by his amendment. He has already referred to what happened in 1932, when Belgium was over-producing fertilisers and had to find a dumping ground. They were dumped here at less than the cost of production. The local factories were not in a position to compete with that kind of thing and they got a small measure of protection from the Government to enable them to carry on. If the industry had been put out of business then, we should have been in a very bad way during the emergency. Senator Baxter believes we should import everything possible——

Mr. Baxter

He believes nothing of the kind and do not try to misrepresent him.

Mr. Foran

Let me finish.

Mr. Baxter

I will not let you finish your misrepresentation.

Mr. Foran

I was only starting. The Senator must be specially gifted when he knew what I was going to say.

An Leas-Chathaoirleach

Permit Senator Foran to proceed.

Mr. Baxter

Please do not allow him to misrepresent me. I have had enough of that in my time.

Mr. Foran

Senator Baxter advocates the importation of everything possible to cheapen the cost of production to the farmer. At one time, we could have imported quite a number of things, including flour and wheat, at less than production cost. We would have been in a nice predicament during the emergency if we had availed ourselves of those opportunities and imported materials which we could temporarily get at less than the cost of production. As a short-term policy, that may seem all right but, in the long run, we have to secure ourselves against possible emergencies. My interest in this matter is the employment of 1,000 persons at a lucrative wage. If these people are not employed in industry, they will have to be maintained somehow—unless you export them, in the same way as the farmers' produce, which some people are so keen on exporting. If this amendment be adopted, we shall open the gates to all kinds of dumping. The industry we have here encountered competition from all parts in the past, and will, I am sure, continue to serve the farmers equally efficiently in the future. But, apart from serving the farmers, they are producing sulphuric acid which is used in the gas works both in Dublin and in Cork. I wonder if Senator Johnston's amendment is passed and this industry closes down——

Professor Johnston

There is no question of closing down anything. This has reference to an industry not yet started.

Mr. Foran

We have an industry at present and we must take full note of it.

Professor Johnston

I do not see how my amendment affects the existing phosphate industry.

Mr. Foran

I do. The amendment says that the Minister shall, under the terms of the sub-section, issue a licence for the import, free of duty, of any chemical product which is used as an agricultural raw material. I suggest that fertiliser——

Professor Johnston

"Under the terms of this sub-section" seems to me to confine it to the activities of Ceimící Teoranta.

Mr. Foran

If you open it for them, you open it for everybody else.

Mr. Baxter

But we are dealing only with the Bill here.

An Leas-Chathaoirleach

If the Senator were allowed to make his case, we would get along much more quickly.

Mr. Foran

I am dealing with the amendment and the possibilities which arise out of it. My last argument against this amendment is that we have here a competent and efficient fertiliser industry. I think it is a valuable asset to have a factory where we have chemists acquainted with the soil and the atmosphere of the country who can produce a product entirely suited to the requirements of the country and you will, in my opinion, seriously injure the existing factory if you pass this amendment.

Mr. McGee

We have heard so much theory and so much which is foreign to sulphate of ammonia, the particular subject we are dealing with, that I would not attempt to follow the various speakers. I disagree completely with Senator Foran when he says that the existing factories supplied us during the emergency. They did not.

Mr. Foran

I did not say they did. They could not possibly have done so.

An Leas-Chathaoirleach

That matter does not affect this amendment and it would perhaps be better not to refer further to it.

Mr. McGee

I also disagree with Senator Foran when he says that the employment of 1,000 men is as much as we can aim at. Far more employment can be given by an efficient system, which this Bill may bring about. I have not started to advocate the founding of a sulphate of ammonia factory here and now; I have been using my best endeavours, privately and locally, for some very considerable time and it will take a good deal to convince me that we can readily cast such an industry aside.

The speech which I would commend most to the Minister was that of Senator Sir John Keane. I should be sorry to think that the country would be overtaxed for the benefit of a sulphate of ammonia factory in a country which could not consume its products and if the price was not in strict keeping with what farmers can pay. Senator Sir John Keane's cement factory has not gone too far wrong as yet and perhaps we are better with it than without it. I can by no means accept the theory that all is well with every factory we have or that all is well on every farm we have. It will take the Minister all his time to balance the economy as between the two. There is no use in our wrapping it up with economic wars as if the economic war were a matter of the past. It is as much alive to-day as ever. Its taxes and tariffs are there to be met, with their detriment to Irish crop production and we have to see whether we can give the same sustenance to our workers as is given across the water. No one should be permitted to stand in the way of that, whether he be a farmer or a manufacturer.

It will take the Minister all his time to get it through, but I say that we have suffered considerably in the last eight years through the absence of ammonia. I am too old to be prejudiced by either political Parties or theories, and, taking a practical view, I liked the speech of Senator Sir John Keane. I also liked the efforts of the Minister for some years to get the industry established, and I cannot come away from him too readily now; but I would prefer that common sense would prevail not only in his Department but in the Government. In view of the difficulties existing, as I see them from my experience of the factories in Dublin, and the wealth they can accumulate as against what we in the country can secure, I can only wish the Minister the best of luck in a very difficult situation.

Mr. Lemass

We will all agree with Senator Johnston and others who expressed the view that industrial development must be rooted in agricultural prosperity. We will all agree that the steps we take to promote industrial development should not be of such a character as will undermine agricultural prosperity. Agreement on these points, however, does not necessarily bring us to agreement with the amendment moved by Senator Johnston.

It is somewhat difficult to discuss the matter at present, because both the section which Senator Johnston seeks to amend and his amendment relate to conditions which do not now exist, conditions in which people elsewhere will be willing to sell us stuff and will be trying to force us to take their materials and even cutting their prices in order to induce us to do so. These conditions do not prevail now. They may not prevail for many years. They have not prevailed for so long that even to visualise them requires as great an effort of the imagination as inspired Senator Johnston's metaphors and parables.

Professor Johnston

They may come back in three or four years' time—you never know.

Mr. Lemass

We do, however, contemplate the possibility that at some stage these pre-war conditions will return, when production elsewhere will exceed demand elsewhere and people abroad will be anxious to sell their stuff and will be prepared to adopt the usual commercial devices in order to keep us buying their materials in preference to making similar materials for ourselves. In such circumstances, we must have power to impose certain restrictions if production here is to be continued.

I do not think it is a fair test to apply to the efficiency of Irish industry that it must at all times be prepared to produce as cheaply as anybody in some part of the world may at that time be prepared to sell goods here. No industry in the world could pass that test. If over a period of years, in various international circumstances and despite fluctuations in price and the trading conditions that may prevail, our industries can maintain a level of prices comparable with those of similar concerns in countries where general conditions are somewhat similar, we will have done well enough.

I fully agree that if we are to engage here in the more extensive production of agricultural fertilisers, or other agricultural raw materials, we must have as our aim their supply to farmers at prices which will not put them at a competitive disadvantage with farmers elsewhere. It may not be possible to do that from the first day on which the wheels of the new concern will start to move, or it may not be possible to do that on occasion when fluctuating economic conditions impose difficulties or give advantages elsewhere; but if, over a reasonable period of time, it succeeds in doing that then it passes the test of efficiency which, I think, we should apply to it.

There may be circumstances which would justify us in establishing and keeping in operation industries of special importance, even though the minimum cost of production here, assuming efficiency in the management and equipment, was still somewhat above the prices at which the products could be imported—industries which, because of their fundamental character, are essential to the maintenance of production in all international circumstances. I would regard the production of agricultural fertilisers as being in that category. If we had fallen to the temptation of permitting the importation of very cheap superphosphate fertilisers from the Continent in 1932 and 1933 we would have had a temporary advantage in those years, but the existing superphosphate industry would have disappeared, and during the emergency years the capacity to manufacture phosphate rock into a superphosphate fertiliser would not have existed in this country.

Professor Johnston

It would not have been possible. There were no raw materials.

Mr. Lemass

There were. It is true that the supply of materials was curtailed by shipping difficulties and curtailed also by other practical problems, but in no year during the war did we fail to import substantial quantities of phosphate rock to supplement the quantities that were mined here for the manufacture of superphosphate fertilisers. We could not have got, in any of those years, a supply of manufactured fertilisers. We know that we suffered considerably in our productive efficiency during the war by the absence of supplies of sulphate of ammonia. We might have had a sulphate of ammonia plant here before the war if we had been more energetic about the job of establishing it than we were. It is, I think, possible to apply theory to practical problems far too rigorously and to arrive at ridiculous conclusions.

Before the war—I have told the story before—the lowest price at which we could see sulphate of ammonia manufactured in an efficient plant here was about 10/- per cwt. higher than the price at which sulphate of ammonia was then being sold here. If that plant had been established, in so far as the main item in determining the selling price of sulphate of ammonia is concerned—the capital charge—we would now have sulphate of ammonia at a price far below that at which we can import it. We were taking a short term view before the war. I do not say that we would have adhered to that view, but we delayed action towards the encouragement of the establishment of the industry because of the consideration I have mentioned. Who is going to say what prices will be, or what general conditions are going to be, in ten years' time or in 20 years' time, or what new international circumstances are going to upset any theories which we may hold to-day? I say that safety lies in promoting productive capacity here with efficient management and trained and experienced workers. These are the things that are essential to our welfare. Therefore, I would not at all agree that rigid commercial principles should always be applied to the decision as to whether or not we should have a sulphate of ammonia industry or any other chemical industry in which this company may at some stage engage.

However, I am not going to dispute the main contention put forward by Senator Johnston and others that we must have regard at all times to the effect of the measures taken to promote industrial development on agricultural efficiency and prosperity, because industrial development must be rooted in agricultural prosperity. Without a healthy and prosperous agriculture, industrial development will always be a stunted growth. I would, therefore, while resisting the amendment, be prepared to give the House the firmest assurance that before deciding to issue a licence to the company to manufacture a chemical product which was the raw material of agriculture, the Government would give as careful consideration to the point expressed in the amendment as any Senator in this House would be likely to give to it, and it would certainly not give that licence unless it was prepared to come before the House to defend its action and to contend that, in the short term or long term aspect of our economic problems, the efficiency and welfare of agriculture would be promoted by the action that we took.

Professor Johnston

I think that this debate has been of some value. I know, of course, that certain sinister motives were attributed to me, motives which were far from being present to my consciousness. I do not know whether I should regard them as a compliment or otherwise, coming from the source that they did. Perhaps I should take them as a compliment. Certain misconceptions which arose in the course of the debate have been partly cleared up by the speech of the Minister. When I drafted the amendment all that I had in view was a possible development under the terms of this measure. I was not thinking at all of the existing phosphate fertiliser factories. I did not at all conceive that my amendment could, in any way, affect their position. All that I wanted to emphasise was that it was essential, in all respects, that the cost of the production of chemical manures should be kept as low as possible. The Minister has been pleasantly emphatic in agreeing that that is a desirable thing to keep in view.

Reference has been made to the fact that in 1932 the importation of phosphates from the continent of Europe was forbidden. It has been asserted that, if they had been allowed in at a dumping price, it would have had the effect of completely wiping out our existing phosphate factories. I think it would have taken more than a few years of uneconomic competition to wipe out these factories. They are solid, well-established and highly successful institutions financially, so that I think they could afford to fight a battle of competition for a year or two. Assuming, however, that in the national interest it was considered desirable to prevent them from having to compete against the uneconomic price of imported phosphate, the right policy to adopt, in my view, would have been to say to the Belgian importers: "By all means sell your stuff here below cost of production, but remember that as long as you continue to do this we are going to subsidise the price of our home-produced fertiliser to such an extent as will enable our manufacturers to sell their product at the same price level no matter how low you reduce your price."

If that had been the policy of the Government during the 1930's, our farmers, instead of cutting to the bone the amount of fertiliser that they were able to use, would have used far more of it. They would have done that even though the price might have been very uneconomic from the manufacturers' point of view. As a result of the policy that was pursued, our agriculture has fallen short of phosphates since 1932 to the extent of 2,000,000 tons. If what I say had been done, the shortage would be much less than 2,000,000 tons, so that the productive power of our agriculture all during the recent war period would have been greater. The output of wheat per acre would have been much greater from land that had not been starved of fertilisers. The cost of living, too, about which everyone has been complaining, would also have been much lower.

I suggest that if my amendment were incorporated in the Bill it would be quite possible for the Minister, through Government policy, to neutralise the effect of it in so far as it might have the effect of preventing production by an Irish-established factory. Suppose a situation arose in which foreign sulphate of ammonia came in here and was being sold at, say, 10/- per cwt. cheaper than the Irish manufacturer could sell it. Under the amendment the Minister would be technically liable to open the ports and allow the free import of this foreign sulphate of ammonia, but he could defeat that by persuading the Dáil to introduce a Bill subsidising the price of home-produced sulphate of ammonia to the extent of 10/- a ton, in which case the principle of this amendment would not apply, and he would be quite in order in continuing to forbid the import of the foreign produced sulphate of ammonia, and the Irish factory could sell its produce at an economic price with the help of the Government subsidy.

The Minister said on the Second Reading:—

"Whether we produce it ourselves or import it, we can subsidise the price. I should not at all disagree with the policy of subsidising fertilisers for farmers."

I welcome that. Rather than add one iota to the cost of production of our farmers, we ought to accept the principle that the taxpayer and not the farmer should pay the additional price, if it is only possible to produce agricultural requisites at a higher price than the price at which they could be imported.

With regard to the possibility of dumping competition, I did not take into account that kind of unfair competition in drafting this amendment. It would be possible to redraft the amendment in such a way as to take account of the fact that short-term dumping competition is not something which should operate so as to bring into effect the principle of the amendment. Consequently with the permission of the House, I shall withdraw the amendment and reintroduce it in a modified form on the Report Stage.

Amendment, by leave, withdrawn.

Sections 8, 9, 10, and 11 agreed to.

NEW SECTION.

Sir John Keane

I move amendment No. 2:—

After Section 11 to add a new section as follows:—

( ) No issue of debentures under Section 14 of the Principal Act shall be made by Ceimící Teoranta in respect of its operations under this Act.

The Minister, when he was introducing the Bill in the Dáil, said it was only a tentative measure, experimental in character, and if it was established that the chemical industry was suitable for this country, there would have to be fresh legislation. I will quote his words. Referring to the protection that the Oireachtas had against any too precipitate or too hasty action on the part of this company, he said:—

"It is not proposed to alter the capital of the company by this Bill or to make any additional financial provision for extending its activities. Under the original Act, the maximum amount which the Minister for Finance can invest in the shares of the company is £500,000. The issued capital of the company is £275,763. The granting of a licence to the company to undertake a new form of manufacture, if it should require that additional capital above the limit now fixed in the Principal Act must be provided from the Exchequer, must also involve fresh legislation so that the Dáil will have a full opportunity of discussing the proposal."

I referred on the Second Reading to the power to borrow on debentures. I think that if the Minister really wishes to carry out his assurance that there will be no fresh funds beyond the issued capital placed at the disposal of this experimental company, he will deny the company the right to borrow on debentures. You give this company power, through borrowing on debentures apparently without limit, to advance on activities far beyond what the Minister contemplated when introducing this measure. For that reason, I put down this amendment to limit, as the Minister had in mind when he introduced the measure, the financial resources of this company; the company must be satisfied, for the time being, to obtain additional finance from the unissued capital, and when the time comes for fresh legislation, it can ask for any further capital that might be required.

Mr. Lemass

It is not correct that the company can raise money without limit by the issue of debentures. Under the Principal Act, it cannot raise money by the issue of debentures in excess of the paid-up share capital or without the consent of the Minister for Finance, given after consultation with the Minister for Industry and Commerce.

I think I can give the Senator any assurance he requires that the company will not finance a new manufacturing enterprise by loan capital. It would be a most undesirable step for the company to contemplate. I cannot conceive that in any circumstances the Minister for Finance would approve of the company financing a new manufacturing development entirely out of loan capital. It would be unwise to impose the statutory bar proposed by the Senator which would prohibit the company raising any money by the issue of debentures for the purpose of new manufacturing enterprises at any time. I do not know whether circumstances may arise which would require that the company should temporarily borrow money by the issue of debentures in connection with new manufacturing enterprise, but, if the need was there, I see no reason why the company should not have the power to issue debentures for the purpose of securing the temporary loan it might require. The power to issue debentures was exercised only once by the company and that was at the beginning, when the undertaking was transferred to the company by the Minister for Finance. Debentures were issued to the Minister for Finance in respect of a debt due to him by the company at the time. That debt has since been paid off.

My observations on the Senator's amendment are that I agree with him that new manufacturing activities should be financed by share capital advanced by the Minister for Finance under the authority of the existing Bill or new legislation in the ordinary way and not by loan capital secured by the issue of debentures. At the same time I think the power of the company with regard to the issue of debentures in respect of such new manufacturing enterprises should not be removed, because this undertaking, like any other commercial undertaking, might find itself in the position at some stage where it would require a temporary loan of money and it should be entitled to effect it within the limits set down in the Principal Act.

These limits are two-fold. They cannot issue debentures to a value greater than the paid-up capital, and they cannot do it at all without the consent of the Minister for Finance.

Sir John Keane

I am satisfied with the Minister's assurance. He agrees with me that the powers could be abused. He says, however, that they will not be abused and I am satisfied to accept that. It will be on record. I shall withdraw the amendment.

Amendment, by leave, withdrawn.

Sir John Keane

I move amendment No. 3:—

After Section 11 to add a new section as follows:—

( ) The balance sheet and profit and loss account furnished under Section 18 of the Principal Act shall set out separately the operations in respect of chemical products as distinct from industrial alcohol.

I hope that this amendment will have some prospect of acceptance. A few moments ago the Minister was saying that we cannot accept the cost of production as the sole test of Irish efficiency. What is his test of inefficiency? I take it he is prepared to admit that there are occasions on which inefficiency may prevail in local manufacture. I would be very much surprised if it had never arisen hitherto. What means has the Minister got to deal with cases of inefficiency, which, of course, take the form of increased prices on the consumer? As I said before, inefficiency in private enterprise means bankruptcy; inefficiency in Government enterprise means carrying on and placing the burden either on the taxpayer or on the consumer.

The first point, as any business man will agree, in testing inefficiency is a proper system of accounting. Here we are going to divide the activities of this industry roughly into two sections. Some of us have been rather staggered by the cost of production of industrial alcohol. Now we are going into an entirely new venture, unforeseen and without limit, except for the financial provisions, and I think it is necessary, from an objective business point of view, to know the costs of manufacture other than those of industrial alcohol. This is to avoid the camouflage, perfectly legitimate purely from the point of view of accounting, of allowing an artificial cost of 7/6 for industrial alcohol, for which there can be always a market, to obscure the true cost of production of other products. I do not see how that can be done unless you segregate the costs of production of industrial alcohol from the other products. I am not concerned to differentiate between all the other products at this stage. No doubt they would have in their internal book-keeping, a system of costings in regard to the main products. What I want is that the Oireachtas and the country should know what is going on. There is very considerable concern at the growing activities of these semi-Government or nominal capital companies, as to which nothing comes out until the annual accounts are published, and the annual accounts are not always as clear as we should like them to be, where, as I say, the factor of bankruptcy does not enter. Therefore, I hope the Minister will see his way to accept the amendment in principle—it may want a bit of touching up before the Report Stage —to separate the costs in the two cases.

Mr. Lemass

I agree fully with Senator Sir John Keane that it is desirable that the particulars he has mentioned should be given. My criticism of the amendment would be that it does not go far enough in that regard. I think he contemplates the company getting a licence to manufacture chemical products; but that is not what is intended. They will get a separate licence for each separate form of manufacture in which they may engage, and in my view they should distinguish in their accounts between every business for which a separate licence has been issued.

The Principal Act as it stands does, however, give ample power to ensure that the company will present its accounts in that way. The Act requires that they shall set out certain particulars, in any event, and that the accounts shall also be drawn up in such a manner as the Minister for Finance may direct. I think I can give, without any hesitation whatsoever, an assurance to the Senator and the House that the company, if it is licensed under this Bill to engage in any form of chemical manufacture or a number of forms of chemical manufacture, will be required to distinguish in its accounts, which are published to the Oireachtas, between each of the separate businesses for which it holds a licence, as well as the business of manufacturing industrial alcohol.

Sir John Keane

It is satisfactory to receive that assurance. Of course, Section 18 of the original Act is not really any substantial protection in respect of what will be done. There was only one product being made. There could be only one set of accounts.

Mr. Lemass

The Minister has the power to require the company to present accounts in such a manner as is directed. I think that is ample.

Sir John Keane

With that assurance of the Minister, I shall withdraw the amendment.

Amendment, by leave, withdrawn.

Sir John Keane

I move amendment No. 4:—

After Section 11 to add a new section as follows:—

( ) This Act shall not come into force until a report has been obtained from high expert authority on the prospects of establishing a chemical industry in Éire and such report has been considered by both Houses of the Oireachtas.

I am sorry to inflict all these amendments on the House, but I feel that these are matters of importance. I hope no one will call this an obstructive amendment. Some people may be inclined to think it is, but that is not so. I have, and I think other Senators have, very considerable apprehension as to the possibilities or prospects of a chemical industry in this country on an economic basis. We differ as to what we mean by an economic basis. I would say that it means producing near the cost of production on a big scale, like we would expect, say, from Imperial Chemicals. I feel that the House should want something more than that there is a prospect of establishing an industry on a lasting basis which only places a comparatively small burden on the consumer. The basis that justifies such an industry is that it should not unduly burden our primary industries.

I feel that, as in the case of the electricity undertaking, we should have had, before embarking on this measure, a report from a body of experts as to the long-term prospects. I agree that at present everything is out of gear and that we have to project our minds over the next two or three years. When I made the suggestion on the Second Reading the Minister said that I was very naïve. He asked did I seriously think that any big firm would come in here and give us an honest report, or that it would not come in here with an eye on its own interests. I do not believe that for a moment. I do not believe that a firm with the standing of Imperial Chemicals would for a moment give any report which they did not believe to be true and honest. They would be paid for the report and they would give the best opinion they could.

Of course, there is another aspect. If I were starting a chemical industry, I should be very glad to give a licence to Imperial Chemicals to come and do the job. With their experience, without casting any disrespect on local talent, it would be a far better job than if it were done by persons in this country with limited experience. So far as our own internal wealth is concerned, every safeguard should be provided; the capital should be provided locally, but you would have the very highest experience behind the business.

It is because I feel so strongly that it is necessary to start this industry with every prospect of success, or not start it at all unless there is such a prospect, that I think such a report should be made before the Bill comes into operation. It would not take long. If the report said that you can make chemicals here at a cost of 10 per cent. higher on an average than it would be in a larger market with more local raw material available, well and good, the directors can go on with their eyes open. Now we are taking a plunge in the dark, which I feel is very dangerous. That is the reason why I put down the amendment.

Professor Johnston

There is a lot to be said for the principle of inviting expert opinion to report on the matter, in much the same way as was done before the Shannon scheme was established, but I am not at all enthusiastic about inviting I.C.I. to be the experts in question because I.C.I. is a somewhat monopolistic concern who have doubtless an axe of their own to grind in a matter of this kind. If you ask the financial interests or the governing body of I.C.I. to make a report, I am not at all certain that you will get a straightforward or objective report. On the other hand, I.C.I. employ numerous university graduates in chemistry, and such, who are experts in their particular subject. I am quite certain that you could get from among the personnel of such people, chemical experts employed abroad and who perhaps feel their exile rather acutely, a perfectly objective opinion as to whether or not we could establish a chemical industry on an economic basis here. So, while I would be all in favour of consulting expert opinion, I would not like these experts to be in any way influenced, consciously or otherwise, by their own financial interests but I would like them to be essentially of the type of chemical experts who would view the matter from an objective point of view and who would not be financially interested in the fortunes of I.C.I.

Mr. Lemass

Senator Sir John Keane's amendment indicates a failure on his part to understand precisely what the Bill attempts to do. The enactment of this measure will not authorise Ceimící Teoranta to engage in any form of chemical manufacture. We are not taking, as he described it, a plunge in the dark. We are not taking a plunge at all, even in daylight. The company will be authorised to finance investigations and experiments with a view to arriving at a decision as to the practicability of various forms of chemical manufacture. In the course of its investigations it will employ experts. It presumably will utilise the services of the best experts it can establish contact with. It is as a result of the consultations and investigations of the company, associated with the advice given them by the experts they employ, that decisions will be made, decisions which cannot be implemented until due notice of the intention to do so has been given to the public at large, because the provisions of the Bill require that, before a licence is given to the company to undertake any form of manufacture, there must be public notice of the intention to give that licence given through the Press. If there is a capital sum involved in the manufacture contemplated in excess of the unissued capital of the company then there must be legislation as well. At this stage, the members of the Seanad, like the members of the Dáil, will be fully entitled to request from the Minister responsible for the measure assurance that expert advice has been secured and that that expert advice supports the undertaking which the company proposes to engage in. I do not think, however, that we should impose the limitation which the Senator suggests, because that really belongs to a different type of investigation. We are only starting the investigation with the passage of this Bill and we cannot get the investigation undertaken at all unless the Bill is brought into force. The Senator says the Bill must not come into force until we have the expert report. The process of getting the expert advice cannot begin until the Bill becomes law.

I notice also that the Senator, in his amendment, refers again to a chemical industry. I want to make it quite clear that we have not in contemplation a chemical industry of the type Imperial Chemicals operates in Great Britain where almost any chemical process is undertaken and any chemical product will be manufactured. We contemplate that the board of the company will investigate various possibilities in the chemical industry and will propose to the Government the granting to it of a licence to undertake only where they are satisfied that there is good ground for believing that the industry is one worth establishing and which can be made to operate successfully here. Within the whole of the chemical field there will be some products which we can contemplate manufacturing satisfactorily here; there will be many which we will not be able to undertake at all. We do not contemplate giving the company a general authority to go into any chemical industry which might be conceived. We will give it only specific authority to undertake the manufacture of named articles when the practicability of that course appears to be established.

Sir John Keane

It is because I find the method proposed in the Bill so utterly unconvincing that I should like this report. It depends on the terms of reference what the report would say. It may be as limited or as wide as would be permitted under the terms of reference. I should like a report by a body of experts saying, "We think there is a prospect of this being a success" or, "With our experience, we are sure as far as world markets and world prices can be forecast, that this is all right". But here we are going to experiment in matters which have been already fully investigated by people who have been in the business for years. I do not wish to cast any slur on anybody but we are taking a number of people who have been engaged in producing industrial alcohol and we are asking them to explore the field of certain chemical production. What are they going to find out? Has not the whole thing been thoroughly explored for years? What is the object of spending this money?

Mr. Lemass

I may have misled the Senator. The investigation which the company will undertake will not be of a scientific character. Scientific research will be undertaken by the Industrial Research Institute. The company will be concerned only to investigate the commercial possibilities of established scientific processes in this country.

Sir John Keane

Commercial possibility—does that mean simply selling, assuming a price, and seeing whether there is likely to be a market for it? I do not see how they are going to work. Are they going to make some product on a small scale, not entirely a laboratory scale, but a limited scale and then decide whether or not that product can be made here? Surely that has been explored for years in other places. There is no mystery about these things. They are ordinary trade products. If the Minister were to tell us that they were going to experiment in plastics to see if they could be manufactured here, I would be more convinced, because that is a new product. I am very apprehensive. I feel that this money is simply going to be wasted in an experiment to discover things that are already known and that have been known for years. That is why I should like to have expert opinion as to whether this thing is worth doing or not. The Minister has told us already that he has figures about sulphate of ammonia production that would justify a local industry. If these figures are available, and if they are put before Parliament, let us cut out the interim period and get down to the production of sulphate ammonia if the Minister is satisfied on the figures. It is because I am not convinced that this money will be spent wisely that I put down the amendment. I have no doubt I will not get support and I will be satisfied to leave it there.

Mr. Baxter

I take it that when the Minister gets his Bill the responsibility is on the Minister.

An Leas-Chathaoirleach

I understand the amendment is withdrawn.

Sir John Keane

I did not actually say the amendment was withdrawn. I said I was satisfied to leave it there.

Mr. Baxter

Of course, unless my consent is obtained also, the amendment cannot be withdrawn. I do not know where these experts could be found. I agree with Senator Johnston that I.C.I. would be rather suspect, and I have experience of a different type from that which Senator Johnston may be thinking of. I have known some of the work of Imperial Chemicals in a particular line in relation to agriculture and certainly it did not raise them in my estimation. I take it that when the Minister gets his Bill the responsibility will be placed on those people to get on with the job. Suppose, as Senator Sir John Keane suggests, we had a report from experts, I do not know that Parliament would like to have that experts' report put before it and to have Deputies and Senators charged with the responsibility of saying "yea" or "nay" to this scheme. I think it is better to put on the Minister and the people whom he has entrusted with the work the responsibility of carrying out the task he wishes to have accomplished. I presume that the Minister, in trying to get information which will determine whether, commercially, a particular industry should be established here will seek the advice of external experts if necessary.

I presume also that if a decision be taken to establish a particular type of chemical industry here, he will have to go to the world outside for the advice of a particular type of expert in the management and working of the industry. It will be interesting to hear from the Minister whether there is available here at home people who are competent to give an opinion upon which a decision can be taken as to whether a particular enterprise might be undertaken by this company, and also whether it will be necessary for him to draw on outside help and technical training to give advice in the management of the industry.

Mr. Lemass

There are many people in this country whose technical qualifications are such that I would unhesitatingly rely on their judgment in the matters on which this board will have to decide. It is true, as Senator Sir John Keane said, that the processes which will be investigated will be established processes. There will be no technical or scientific secrets about them to be discovered. The best illustration I can give is sulphate of ammonia itself. I know enough about that to know that there are a number of different processes for the manufacture of sulphate of ammonia, all of which are protected by patents to a greater or lesser extent. The question for the board to investigate and study is which of these various methods of manufacture is most suitable to our circumstances, from the point of view of the raw materials we possess or the costs of manufacture here by different methods. These are the issues on which the board will seek advice and on which it will arrive at a decision. On many of these issues, they have available, either amongst themselves or in the country, persons who are fully competent to give an authoritative, really expert view for the guidance of their colleagues or the Government. It is on questions of that character, rather than on more scientific questions which would ordinarily be dealt with by the Industrial Research Bureau, that the board will carry out investigations and report to the Government.

Amendment, by leave, withdrawn.

Title agreed to.

Bill reported without amendment.

An Cathaoirleach

When is it proposed to take the next stage?

Professor Johnston

May we have the Report Stage at a later date, so as to give me an opportunity to submit some amendments?

Mr. Sweetman

So far as I am concerned, I have handed in an amendment, and I am prepared to meet the Minister's convenience.

Mr. Lemass

It is hardly worth while convening a meeting specially to deal with these amendments. So far as I am concerned, we can take the Report Stage to-morrow or at a later date.

Mr. Sweetman

I understand that the Minister for Lands will be here at 3 o'clock to-morrow and that the Tánaiste will be here at 7 o'clock in connection with another matter. Might we agree to take the Report Stage of the Bill not before 7 o'clock to-morrow, and if it then transpires that we shall have to meet next week for other business, we could leave the Report Stage over until then? If we are not to meet next week, we could take the Report Stage to-morrow evening.

Ordered: That the Report Stage be taken not earlier than 7 p.m. to-morrow evening.

Business suspended at 6 p.m. and resumed at 7 p.m.