I regret that Senator McGuire did not open this debate instead of Senator Hayes because I might have found myself more devoid of controversial material for a reply than has been afforded me by the Senator who did open it. I cannot quarrel with the approach which Senator McGuire suggests we should adopt in considering matters of public policy which come before this House for discussion. In order that there should be no misunderstanding, however, about the reference made in the Stacey May Report of the financial and economic conditions existing in this country, I think I should put it upon record that, according to the report, the field work for it was carried out in Ireland in June and July of 1951—another member of the team responsible for the report visiting Ireland in September, 1951. Its findings therefore were obviously based upon conditions which the Stacey May team found existent at that date. Whether, if the same team were to visit the country to-day, they would have precisely the same criticism to make is something known to none of us, of course.
Senator Hayes on this occasion, somewhat unusually for himself followed my succinct and purely factual opening like an Indian brave and came in with war whoops and a tomahawk to scalp, not merely the members of the Fianna Fail administration, but every member of the Fianna Fáil Party since its inception and initiation in 1927. In fact, the Senator went back to the days which preceded the birth of the Party and administered what one might call pre-natal scarification. He referred to the civil war and to our attitude in 1927 when we entered the Oireachtas of the Free State. He alleged that we had come in full of venom towards the civil servants and towards public employees generally, but I think, and I am sure Senator Hayes will agree with me when he thinks it over in his calmer moments, that that was an unfortunate reference to make.
We sacked no man when we came into office in 1932 because of his political opinions and asked no teacher, either primary or secondary, to sign a political test pledging their allegiance, support and loyalty to the Government of the day. We accepted all the members of the Civil Service and the teaching profession as we found them and gave them what is described in America as "a fair deal". We have no animus towards any member of the Civil Service or any member of the forces who were in arms against us in 1922 and 1923. We have tried, to the best of our ability, to fulfil the precept of Tone and unite the whole people of Ireland, which is the basis of Fianna Fáil policy.
I think that Senator Hayes's arguments in regard to the standards of pay, remuneration and conditions of service of the civil servants were somewhat misconceived. He argued, for instance, that for work of a type which would normally be done by a person who had secured the Intermediate Certificate the Government were getting the very foremost who had secured the Leaving Certificate. I assume that consistently with that he would have stated that the same thing applied to the executive grades. What does that prove? It can only prove that the conditions of pay and of service are so attractive that we are in fact attracting to these lower grades people of a very much higher standard than normally the work of those grades would call for. I think that nothing else can be deduced from the arguments which the Senator advanced.
I do not propose to deal at all with the Senator's suggestion that it has been our policy to increase continuously the cost of the public service, because that has already been demonstrated beyond denial to be untrue. If the norm of judgement is to be the record of our predecessors, then in 1947-1948, as has been pointed out here by Senator Hawkins, the total expenditure on supplies and services reached a figure of £58,918,000. In 1951-1952 expenditure on Estimates which had been prepared by our immediate predecessors in Government showed an increase to over £90,000,000—an increase of 53 per cent. in three years in the cost of these services. To the extent to which there was a further considerable increase in cost last year, it was due mainly to the policy of our predecessors in establishing, first of all, the arbitration board to honour whose findings we had to find £3,500,000.
In addition to that, we had to find one half year's interest on the Marshall Aid Loan, and had, furthermore, to find the annuity which is payable in respect of voted supplies and services. We had also to implement, in an amended form, of course, the decision of our predecessors which was adopted and accepted by us, to extend and improve social services, and to bring in a new Health Bill. These are factors which have occasioned this very substantial rise in the cost of public services. We have inherited many obligations from our predecessors and we are endeavouring to fulfil them.
Turning to the speech of Senator O'Brien, I should like to say that I listened to it with a great deal of attention, and with a great part of it I would not have much quarrel. There is, however, one statement of his which, I think, might not be fully substantiated by the facts. He stated that agricultural production was stagnant. That may have been so two or three years ago. I think indeed that, so far as the statistics go, they demonstrate that that probably was the position in 1949, 1950 and 1951. Undoubtedly there does not appear to have been any very great or significant increase in agricultural production over that particular period. There has, however, been a very significant change since then-a change which has taken place during the year 1952
Senator McGee, whose knowledge of rural conditions, I think, very few Senators would dispute has stated that the one thing that is clear, forthright and satisfying is the very great rural prosperity that is apparent everywhere. That is what Senator McGee has stated. Supporting that assertion we have furthermore this very significant fact that in 1952 we had a very substantial increase in exports of agricultural produce and a very substantial overall increase in exports of all kinds. I think that the figures are worth putting on record. Agricultural produce increased in value from £46.7 million in 1951 to £54.1 million in 1952. That is an increase of £7.4 million. Other exports increased from £33.1 million in value in 1951 to £45,000,000 in 1952, an increase of £11.9 million. The overall figures were total exports £79.8 million in 1951 and £99.1 million in 1952 or an increase of £19.3 million.
Let us now consider what the volume index discloses. Taking the total of all exports and re-exports in 1951 as 100, in 1952 the volume index was 121, or an increase of 21 per cent. Against that the price index for exports shows that their statistical unit value rose from 114.1 in 1951 to the index number 117 in 1952 or only about 2½ per cent.
These statistics would not seem to suggest that, taking them with certain others which I shall mention, there was stagnation in agricultural production. Thus we have the fact that the number of live stock in this country on 1st January, 1950, which might be described as the last full year of the Coalition régime, was 3,821,000 head, and on the 1st of January last the cattle population had increased to 3,872,000 head. Similarly the pig population was estimated on 1st January, 1950, at 510,500 beasts and on the 1st of January this year that number had increased by 50 per cent. to 764,700 pigs. It seems to me, therefore, that perhaps—and I want to make this statement with all reserve—that perhaps it is no longer true to say that agricultural production in this country is stagnant. On the contrary, agricultural production is increasing and is expanding and we have proof of that again in the statement made by Senator O'Callaghan that there will be a considerable increase in the area under wheat and beet in this year. These are facts which, in view of the manner in which Senator O'Higgins, with the usual family facility for misrepresenting statements, has tried to distort the statement made by Senator O'Callaghan, are worth recording.
I do not wish, however, while I say all this, to quarrel with the statement which Senator O'Brien made that possibly the financial structure which productive industry in this country was carrying was too top heavy for the base. I feel that there is a great deal of truth in that, and so far as I can influence any new change for the better in the situation, I shall certainly endeavour to do so.
I also cannot quarrel with the statement that the Senator made that while we want a balance in our external payments and a balanced Budget, we want the balance of external payments to be achieved at the highest possible level of trade, while equally clearly we want the balance on the Budget to be achieved at the lowest possible level. These are matters on which, I think, there will be common agreement.
I want to come to one of the statements made by Senator O'Brien to which I might take exception, I think rather because of the implication which it contained. Senator O'Brien said that among the economies which should not be practised are those which give rise to discontent in public service, and the allegation that promises have been broken. I do not know whether the Senator has in fact endorsed the allegation that promises have been broken, but in case that any other member of the House might be disposed to assume that promises had been broken, if I allowed the Senator's statement to go unchallenged, I should like to say that the Government has not broken in any particular the agreement which was made with the Civil Service to establish a scheme of conciliation and arbitration.
On the contrary, the Government acting in the best interests of the State and in the interest of the people has merely insisted on the right which it enjoys under the scheme to reserve taking action upon the arbitrator's award until the financial, the fiscal, consequences of giving effect to that award have become manifest, and until the capacity of the people—because it is the people who are involved in this and not the Government; it is the people who have to honour the arbitrator's award, as the money does not come out of the pockets or the coffers of the Government, but out of the pockets or coffers of the taxpayers— to meet the increased burden which the arbitrator's award would impose on them has become clear.
I want to put on the record of this House what is the significant section, the effective section of the arbitration scheme in this matter. The effective provision to which I refer is Article 20 of Part IV of the Civil Service Scheme for Conciliation and Arbitration. Part IV relates to arbitration only and Section 20 reads as follows:—
"(1) Subject to the provisions of sub-paragraph (2) following, the Government as soon as may be after such presentation..."
that is, the presentation of the report of the chairman to the Government
"...will either signify its acceptance of the finding contained in the board's report or will introduce a motion in Dáil Éireann recommending either the rejection of the finding or such modification therein as it thinks fit.
(2) When they receive a report from the arbitration board on a claim for a general revision of Civil Service pay, the Government will, when presenting the report to Dáil Éireann in accordance with paragraph 19 preceding, adopt one of the following courses:—
(a) Signify that they propose to give immediate effect to the findings of the board in full;
(b) introduce a motion in Dáil Éireann proposing the rejection or modification of the findings;
(c) signify (1) that they consider that it would not be possible, without imposing additional taxation, to give full effect to the findings within the current financial year, (2) that they propose to defer a final decision on the report until the Budget for the next following financial year is being framed, and (3) to what extent, if any, they propose in the interval, without prejudice to the final decision, to give effect to the findings, the extent of the payment to be determined by the amount which can be met without imposing additional taxation."
I direct the attention of the Seanad to those words: "the amount which can be met without imposing additional taxation." The Taoiseach and myself in public statements in Dáil Éireann have already mentioned that the Budget for this year will show a deficit and therefore it would not be possible, unless we were going to borrow in order to pay the salaries and remunerations of the civil servants, to give effect to the award without imposing additional taxation. The general purport of paragraph (c) of sub-section (2) of Section 20 of the arbitration agreement is that if the implementation of the award is going to necessitate the imposition of additional taxation, the Government has the right—and indeed I should say has the duty—to defer taking a final decision on the award until the Budget for the following year is being framed.
Now, I have said here that the Government has acted wholly within its rights and, I think, has acted as it is bound to do in the discharge of its duty to the taxpayers and to the people of the country generally. What has been the attitude, however, of those whose conduct apparently is endorsed here by Senator Hayes and Senator O'Higgins? They have attempted by public agitation to coerce the Government to forego its rights under the scheme. They have endeavoured to coerce us by public agitation to abandon or to fail to discharge our duty to the taxpayer.
Now, every article in this scheme of conciliation and arbitration is of equal weight with every other article in it. If the civil servants have rights under the scheme, the people of this country and the Government which represents the people and acts for them have rights, too. These rights are just as sacrosanct as those of the civil servants but the action which has been taken by certain Civil Service organisations is a denial of this principle. It constitutes on the part of the particular associations concerned a breach of the fundamental agreement between the staff associations and the Government and it, therefore, must raise the question—and it certainly has raised it in my mind at least—as to whether the Government should continue to recognise these particular associations as coming within the terms of the scheme.
There are certain staff associations which have honoured the agreement in the spirit and the letter and I should like to make it quite clear that they are in no way covered by what I have just said. They have recognised the difficult position in which the Government finds itself and they have accepted the fact that the Government is acting in good faith and, as I have said, in discharge of its public duty. I have no criticism whatever to make of them. On the contrary, I have indeed to acknowledge the responsible and restrained way in which they have behaved during the whole of this very trying time.
Perhaps I may leave that to come to another suggestion which Senator O'Brien made. The Senator suggested that there should be some sort of corporation or organisation set up for the purpose of collecting, channelling and investing the small savings of the people. There is, of course, already in that field one very big institution, the Post Office Savings Bank. Under the ægis of the Post Office also we have the plan of savings certificates. Both of these are designed to tap such pool of small savings as may exist. It is quite true, of course, that the Post Office Savings Bank does not at all—nor do any of the trustee savings banks— invest or place their resources in industrial securities, and to that extent they would fail to fulfil the whole purpose which Senator O'Brien had in mind in making the proposal. But, at any event, I think it would be quite fair to say that they receive the whole volume of small savings available and that nowadays they devote the proceeds wholly to financing capital undertakings.
The Post Office telephone expansion, the telephone capital expenditure, is financed mainly from the Post Office Savings Bank. The proceeds of the savings certificates go into the Exchequer in the ordinary way and are used to defray the cost of various capital projects that are undertaken by the Government directly or by the various statutory undertakings set up by the Oireachtas, like the E.S.B., Bord na Móna and those other concerns with which we are all familiar.
Now the first question, therefore, that arises is what savings would be left to feed this investment corporation which Senator O'Brien has pressed for. Would the amount of savings remaining be sufficient justification for establishing it? I think that we can put up a very large question mark there, at any rate.
The next thing is, with our very limited resources and in our very limited market, where the number of active operators in industrial securities would be very small, would such an investment corporation as Senator O'Brien has in mind be really a very great asset to us, bearing in mind that he thought of it as an agency for attracting foreign capital into our industrial enterprises. I think that it is to be doubted, because the real difficulty in activating the market in Irish industrial securities is that in general the conditions which make for prosperity and expansion of Irish industry on the one hand, or recession on the other, are very largely outside our control. Irish industry—we may as well face up to it—is a very narrow and unrepresentative sector of world industry, and world conditions would have much the same effect, would have full effect here on Irish investors or on potential investors from outside as they have elsewhere. They would have all these reactions with this difference, that an investment corporation would naturally be very anxious to conserve its capital resources, would get out if it thought the market was going to fall and might not be so anxious to get in again even if it thought the market was going to rise.
In conditions like a state of business recession or depression or whatever description we care to use, a large investment corporation would be anxious to get out, and will be prepared to do so, to cut its losses at a very early stage, and will be especially anxious to do so if a large part of its capital is derived from external sources. On the other hand, if you have not any such organisation operating, if the holdings are widely distributed, the ordinary small holder of Irish industrial securities, even if the market does start to slide a bit, is generally prepared to hold on to them, mainly because it is expensive for him to get out—is generally prepared to hold on in the hope that conditions will change and that the market value of his securities will rise again.
In the course of the debate here a great many things were raised which I think the Government cannot be held responsible for. Senator McGee referred, for instance, to the manner in which local authorities maintain county roads, particularly those roads which serve some remote districts in the country. Well, all those roads are the responsibility of the local authority. It is quite true that in the case of these county roads—it was I who initiated it—the practice is that very substantial subventions are now given to the local authorities to enable them to maintain the county roads as distinct from the trunk roads; but we cannot expect that the local authorities will be relieved of all their obligations in this matter. If they were there would not seem to be very much justification for maintaining the local authorities with their very large and expensive staffs. Therefore, so far as the county roads are concerned, if in the County Louth they are not up to the standard which Senator McGee would like to see obtaining, I would suggest that instead of addressing his remarks to the Minister for Finance, he might perhaps admonish his colleagues on the Louth County Council and endeavour to persuade them to raise a little more money in local taxation and spend it upon the local roads.
Senator Seán T. Ruane spoke about hospitals and sanitation and seemed to blame us for the defects of the staffs of the local authorities or of various engineers and architects and others who had been retained by the local authorities. Surely that is the responsibility of the local authority; and certainly whatever other failures you may try to place on the shoulders of the Minister for Finance or even of the Minister for Local Government you cannot blame the Ministers because the local authorities apparently did not take action to ensure that they would get the standard of service from their officials and from those whom they had retained as specialists which they were entitled to expect.
Senator McHugh had the same sort of complaint. Now surely the Senator is not so green and simple as to believe that the Minister for Local Government and Public Health, as it was ten years ago when the hospital to which he referred was being built, had any responsibility for building it. It was built by the local authority. The only thing about it was that it was financed out of the Hospitals' Trust Fund; but the central authority had not any responsibility for placing the contract or for supervising it or even for planning the undertaking. It is true that the Minister for Local Government and Public Health would have had to be satisfied that the accommodation which was proposed to be provided would be adequate for the number of patients, but the general detailed planning would be a matter for the local authority; and certainly, if the local authority, having secured considerable sums of money from public sources, allowed that money to be spent with the deplorable results which Senator McHugh has described to us to-day, it seems to me that it is the local authority that is culpable. I do not know if the Senator is a member of the county council, but if so he ought to indict his colleagues at their next monthly meeting for having permitted these abuses to obtain.
The Senator seemed to be, in relation also to a number of other matters, very badly misinformed. We are discussing now the Vote on Account, the amount of money which has to be provided to enable the ordinary public services of the State to be carried on for the next four months; and there is nothing in this Vote about the purchase of a racehorse—nothing whatever—nor are the people going to be taxed in order to purchase a racehorse, certainly not in the next Budget; nor is there any proposal to buy aeroplanes, whether obsolete or of the most up-to-date kind, and the simple Senator, therefore, ought not to be led up the garden path by over-enthusiastic propagandists like Senator O'Higgins. He ought to study these matters for himself and try to find out the truth.
There is no proposal on the part of the Minister for Industry and Commerce or of Aer Línte to purchase planes of any kind. I hope that will be quite clear. There was a proposal to re-establish a service which had been strangled at birth in 1948, a service which would have been a magnificent dollar earner for the whole of these three years and which would have enabled us to deal much more easily and readily, and with much less inconvenience to the public, with the deficit on our balance of payments last year. It may be a matter of doubt whether we shall succeed in re-establishing it, because it is easy to kill a promising undertaking, such as Aer Línte was and such as it has been shown to be by the experiences of other airlines, but very difficult to re-establish it. In that connection, if the Senator is interested—and, perhaps, coming from Ennis, he might be interested in the development of Shannon Airport—he should see what the Germans are trying to do. They are buying planes. They have set themselves out—they are working 60 hours a week in order to do it, bearing a very much heavier burden of taxation than we are, and living, some of them, literally in holes in the ground—to buy a magnificent fleet of the most up-to-date airliners in order that they may enter what they realise, and what we realised long ago, was going to be a very lucrative source of income for their country and for their people and a very important source of employment for the skilled men of their country. They are lucky because they have had a Government in the past few years which has been looking ahead. We had a Government over three crucial years of our history which was looking backward all the time, or at least, was looking with squint eyes at the achievements of its predecessors.
Now I come to Senator O'Higgins. When Senator O'Higgins speaks, it is difficult to know whether one is condemned to listen to a juke box or a political corkscrew. The Senator has the capacity of a juke box to reproduce interminably worn out records and, at the same time he has some of the characteristics of a corkscrew, that is to say he is in a state of perpetual twist. He told us that the Government had not done anything to initiate a savings campaign, that we had "to be kicked into it" was, I think, his chaste and elegant phrase, by the Leader of the Opposition. The Government, I think, did a very effective job in initiating a savings campaign when it launched the last national loan and secured subscriptions from the greatest number of people, the greatest number of individual subscribers since 1922. That was no mean opening to a campaign to encourage the people to be thrifty and saving.
Before that, we had initiated a new series of savings certificates. Subsequent to the success of the loan, we had made arrangements to set up a special organisation to induce the public to save and to use all the propaganda methods that might be designed to that end. We had naturally to wait until a building became available. The headquarters of the campaign were opened yesterday. A director of savings was appointed some three months ago, before January last. He had been designated for the post some time before that, and, if the Senator who said that we were kicked into this activity by the Leader of the Opposition, will turn to page 299 of the Book of Estimates for the Public Supply Services he will see there that there is a person holding the rank of senior deputy accountant whose departmental title is that of Director of Savings. That appointment was sanctioned by me before the close of 1952. The Leader of the Opposition, the former Taoiseach, addressed the Fine Gael Ard Fheis on 18th and 19th February, so that, so far as this institution is concerned, I do not think Deputy Costello had anything to do with its initiation. The only thing is that he thought he would get on the band-wagon and try to make it appear that he was leading, whereas in fact he was, like the revolutionary mayor, merely running after the crowd.
The Senator also read a very long quotation from Deputy Costello's speech at the Fine Gael Ard Fheis advocating tax concessions on investment in Irish industry. It is a great pity that apparently the Senator and the Deputy whom he follows are ignorant of some of the provisions which were included in the Budget of 1932, 21 years ago. They were introduced into the Finance Bill of that year by a Fianna Fáil Minister for Finance and, if I may say so, were severely criticised by the then Cumann na Gaedheal Opposition. They called themselves Cumann na nGaedheal at that time. There is nothing new in this, but the thing that is most astonishing is the fact that, though these tax concessions in respect of income from investments in Irish industry have existed for over 20 years, the Leaders of the Fine Gael Party and the Fine Gael organisation seem still to be unaware of them.
What else did Senator O'Higgins say? He said that I asked the people to vote for Fianna Fáil because General Eisenhower had been elected President of America. That is a proof of what I have said—that Senator O'Higgins is living in a state of perpetual twist—because I said nothing of the sort.
