In opening last night I traced a little of the idealistic background of the Common Market itself and the fact that we must all feel a great sense of pride and confidence in the fact that the whole movement began by such statesmen as de Gasperi, Schumann and Adenauer who were ranked as the three finest statesmen that have emerged in Europe in the past few hundred years. We all support the full realisation of their dream of a Europe united, a Europe that has a major role to play in the world, which will be a counterweight representing the European viewpoint between America on the one hand and Russia on the other.
The movement started off on economics. Spectacular results have been achieved. They are now working towards an ever-closer type of political union which may take ten to 15 years to realise. In joining we have a commitment to work with the other nations for the fulfilment of this ever-closer union of European peoples. It is not so much a commitment as a privilege and an honour to be able to contribute to the strengthening and the fashioning of the new Europe, just as we are anxious to play our part in the United Nations and in other bodies working for a better world. We can make a very positive contribution in the fashioning of the new Europe. We can be pragmatists as well as idealists in that we realise that the development of a new Europe involving a close union with European peoples is essential for the preservation of peace both in Europe and in the world as a whole.
It is essential that the major powers like Germany, France, Italy and England be part of that union. Equally, we should realise that we are not essential to it. It is not going to make or break the united states of Europe whether or not we are a part of it. Our position on the periphery of that group between Europe and America gives us a still further boundary position that is not right. I should like to emphasise that, having achieved European union which may take ten to 15 years at that stage, the Treaty setting out this new union and the political and other commitments involved in it, including defence, will have to come back to each of the member countries for ratification. It is laid down in the Treaty of Rome that such a procedure has to be followed.
The amendment of the Constitution which will be put before the people on 10th May ensures that they will have to be consulted when this new Treaty comes for ratification. There will have to be another referendum in ten to 15 years time. At that stage we will have to face squarely the political and other commitments involved in continuing in the Community. If our not taking part in it did any damage to the cause of European and world peace, I would be very keen that we should take part. On the other hand, I believe it does not matter to European and world peace whether or not we are in it. In short, the crucial referendum will be the one in ten to 15 years time. We have a very free hand in looking at our position at that stage. We can make a decision either to opt in or out as we feel it suits our national interests. I would feel that, having played a part in fashioning it, there would be a desire on our part to continue. I wish to stress that the people will have the last word then. In ten to 15 years time we will be able to look at the world situation. We cannot say today what the world situation is likely to be. Neither can we forecast the economic situation then. Is there going to be an economic advantage to our staying in the political community at that stage? All these points will have to be weighed.
The present referendum deals solely with a trade pact. That cannot be emphasised too often. It is merely the question of gaining entry into European markets for our goods and the opportunity of working with others towards the betterment of Europe and world peace. Consequently, we can assess this question as if it were one of a trade pact. We must consider if it is in our national interest to enter into this pact. It is not going to affect the development of the European Economic Community whether we enter or not at this stage. We are only an island of four million people and can exercise no decisive powers. We can have a great moral influence— Christian leadership—in joining with the Christian Democrats and others in fashioning the new Europe. The decision is ours. It revolves solely, at this stage, on the question of the trade pact.
There is another point which should be emphasised. If at any time in the short term, in the next three, four or five years, all our estimates were proved wrong, as the Leader of the Labour Party seems to suggest when he says that we are not ready for full membership and that it will have very disastrous effects for us, then the obvious duty of any Irish Government would be simply to recognise the situation and return to Brussels to renegotiate our position.
There is nothing binding in the question of a trade pact. If you cease to obey the rules, then you are out. It is as simple as that. France withdrew from participation in 1948 and did not return for a year and a half. What was the meaning of the recent French referendum? If the people had voted "No", what would that have meant? Obviously it would have meant that France was out. Mr. Wilson stated that he would renegotiate, although his position is very doubtful and seems to be an exercise in political gymnastics. It does not advance the credibility of his leadership. This is the factual position. All the interested parties such as the major political parties, the independent economists, various students of political and economic affairs, the various farming organisations, the federation of manufacturers and many of the trade unions, including Mr. Larkin's union and others, cannot be wrong in deciding that this opportunity offers us a tremendous possibility to develop our country.
As regards the negotiations and results, we agree that the transitional terms were more favourable than any of us expected. The Government deserve our congratulations on their achievements. These achievements were largely the work of the official Civil Service negotiating team in Brussels. The Minister for External Affairs, Deputy Hillery, gave them excellent leadership. Any criticisms are less than generous because there have been no suggestions as to how the terms might be improved.
In the present situation great credit is due to the Fine Gael Party for taking a national stand on this question, when a narrow self-interest in their case might have given them the opportunity of bringing down the Government. I hope that this coming together will mark the beginning of a frequent non-party approach to many of our national problems, and that all-party committees, on the basis of their use in Holland and elsewhere, will become a feature of our approach to our problems. We cannot afford the luxury, in 19th century fashion, of political debate and exaggerated political criticisms. We are too small a community. The world is too small for us to indulge in such luxury. I hope we will choose the all-party approach for the future. If the referendum is carried by a large majority, as I am confident it will, I hope the Labour Party will come in with the others to ensure a united approach to our problems in the years ahead.
The dominant feature in the present context is that we cannot compare the future with the present. People may say about the present situation that we could be worse off. The one certainty about the future is that, if we do not go in, we will be even worse off than at present. Our two main exports, industrial and agricultural, to the British market are going behind the tariffs walls of EEC. This would be a totally new situation for us. If we are to judge by our success over the past ten years in selling to the countries behind that tariff barrier, there is little hope for the future.
In the early sixties we had quite a promising sale in some agricultural products, beef especially, to Germany, Holland and some other continental countries. That trade has virtually disappeared now due to the levies, quotas and other restrictions placed on it. We will be endeavouring to help the hill farmers in our development of the sheep industry, but we can all remember how we were treated in the Paris market where it was not simply a case of having to face a tariff of 20 per cent or 25 per cent, but of having the door shut in our faces whenever it suited the French authorities to do so. Consequently, our exports to that market have been greatly reduced and provide no base whatsoever for the development of an Irish sheep industry.
We know of the difficulties we encountered in selling our dairy products two or three years ago when butter was being sold in some African countries—which were new markets we were told to develop—at a shilling a pound. Yet a market of 200 million people was available in Europe and we could not get butter into it to sell it even at a shilling a pound. What hope have we of selling dairy products in the EEC? What hope have we of getting them in when England has been unable to secure the continued access of New Zealand and Australian dairy products on the same basis as heretofore? In fact, the Australians are going out of the market and the New Zealanders are to have their cheese exports phased out and their butter exports reduced to 80 per cent by the end of the transitional period. That percentage is to be reviewed again after the transitional period. If England was not able to obtain better percentages for her dominions in New Zealand and Australia what hope have we of doing so? Surely our hope does not lie in the sending to Brussels of some of the hundreds of would-be negotiators that have blossomed forth on the Irish scene? The idea of negotiations held by those people is simply that we just send over everything we have and they are expected to take it.
I was amazed to read in today's paper that the Leader of the Labour Party, who is in favour of an associate agreement, in trying to point out the difference of his associate membership concept of the EEC and the full membership that has been negotiated, wants to have full access for all our industrial products to the enlarged EEC without quotas or levies. What does he expect to give in return for such a concession? Surely he would have to give the same as Sweden and the other associate members, that is, access to the Irish market on the same terms for all European industrialists. No other arrangement would be possible and that arrangement would only cater for industrial goods. It is regrettable that the Labour Party seem to have forgotten about the question of maketing agricultural products. Some of them suggested that we could sell them to eastern Europe. Our history of selling to eastern Europe over the last 20 years has not been very impressive but this was not the fault of the sales teams who went out there. We have an imbalance of at least six to one with most of those countries.
Underlying this assumption of associate membership there is a feeling that we will be in a position to prop up industries that are in trouble. In other words, by means of State aids we will be able to dump our products on the EEC if we remain outside it. That simply is not true because the fundamental concept of free trade in the Common Market is that there will have to be fairly rigid rules to prevent dumping. I believe we are more concerned with the prevention of dumping than the bigger countries because much more damage could be done to our industries by dumping. I cannot understand why people can put forward such naïve ideas on trade arrangements.
Other alternatives have been suggested, which would be comical if the matter was not so serious, such as subsidising both agriculture and industry. One celebrated economist has even suggested using the printing presses for money. I thought we had moved a little away from that kind of thinking. Those who hold that our economy is too weak for full membership cannot have studied the protocol of the EEC or realise the value of what has been negotiated. The protocol, on page 114 of the White Paper, recalls that the fundamental objectives of the Community consist of a steady improvement of the living standards and working conditions of the people living in the member states, together with the harmonious development of their economies by reducing the differences between the various regions and the assisting of the more backward economies. It goes on to note that the Irish Government have the same objectives. On page 114 under the heading "The Member States of the Community" it says:
TAKE NOTE of the fact that the Irish Government has embarked upon the implementation of a policy of industrialisation and economic development designed to align the standards of living in Ireland with those of the other European nations and to eliminate under-employment while progressively evening out regional differences in levels of development.
Having noted that as being an Irish policy the third paragraph states:
RECOGNISE it to be their common interest that the objectives of this policy be so attained.
It is in the interest of the EEC that the Irish Government succeed in its policy of regional development and of raising the standard of living of our people. The fourth paragraph goes on to say:
They agree to recommend to this end that the Community institutions implement all the means and procedures laid down by the treaties, particularly by making adequate use of the Community resources intended for the realisation of the Community's above-mentioned objectives.
That is a blank cheque intended for our use to demand all sorts of concessions and aids to carry through our policy of improving the standard of living of our people and of eliminating difficulties in the less favoured parts of the country. Of course, the cheque is only as good as our negotiating team. Our negotiators may look for some special concession, particularly if that special concession is intended as an inducement for industry in order to prevent that industry from getting into trouble. If our team fight strongly enough in Brussels for it, then the Commission are empowered to give anything they like under this protocol.
I do not think that the importance of that has been realised. I am amazed at the attitude of a party such as Labour, and their supporters who claim to be socialists in the best sense of the word, and who are supposed to be completely concerned with the welfare of their fellowman. Although many of us subscribe to the idealisms of socialists, we may question the practicality of some of their statements, and we can accept their idealism and practical Christianity in their concern for the underprivileged and the underdeveloped.
It amazes me that these same people can treat absolutely cynically the aims and objectives of the Common Market, which are largely aims and objectives in which socialist thought has played a very strong and leading part in fashioning. It began with the Christian Democrats and today the dominant philosophy in Europe is that of the Social Democrats and the more middle-of-the-road thinking of socialism. As far as I know, there are only two socialist parties in Europe who are not endorsing and accepting the aims and objectives of their fellow-socialists in Europe for the improvement of conditions in Europe generally. They are the Irish Labour Party and the British Labour Party, although the latter have not questioned the objectives. They have only suggested negotiating for better terms. Otherwise, they are in favour of entering the EEC.
I consider this to be extraordinary and I should like spokesmen for the Labour Party to explain this deep distrust they have of their fellow-socialists in Europe. If they are subscribing to socialist parties in general, are we to accept that their protestations are not to be taken seriously?
If we take into account the situation in our six counties in Northern Ireland, it baffles the mind to see how anyone would want to convert the existing, we hope, temporary border into a permanent European border, maintained by the resources not of Britain but of Europe. This would disrupt the trade that has always existed between North and South. A great deal of play has been made that ten out of the 12 representatives from the Unionist and nonUnionist sides in Westminster opposed entry into the EEC. That is not correct. They opposed the entry of Britain into the EEC. I can see the reasons for and against that.
If I were part of the British system and took a narrow British insular outlook on it, I might feel that England would have to pay a fairly high price for being part of the fashioning of a new Europe. On the other hand, if one is European-minded and conscious of the need for peace and the development of industry in the world, one would ensure that for the potential peace and development of the EEC Britain should go in and play her part in it. However, the issue they voted on was that the comparable issue today would have to be, with the decision of Britain to go in, whether they wanted the Six Counties to stay out or to go in? I have no doubt that of the ten who voted, most of them, in such circumstances, with Britain going in and so creating a completely different situation, would have voted that the Six Counties should do the same.
The dominant issue for us is to have access to our markets in Britain. That is the reason for our voting for entry, along with the realisation that we must have complete economic development of our resources if we are to achieve the full development of our country. Politics without an economic base is of little use to any country.
We have to look, then, at what this arrangement has to offer. We have to examine it from the point of view of both agriculture and industry. In the case of industry we find at present that some of our industries are going through a difficult period, largely due to technological changes. The textile industry, for example, is having great difficulty in competing with the various synthetic fibres available. Consequently, they have redundancies and many of them are closing, but it is not the EEC which is causing that. It is simply the changes in technology.
We have got to accept that in the modern industrial world technology is always changing, that new processes are coming in, making more products obsolete. Consequently industry must always be ready to adapt to change, to go into new lines of work and to retrain its workers. In any factory there are three aspects. There are the workers, there is the factory building and there is the management. The three have got to be able to change— change processes, change the work they are doing—when there is the demand. There is no use in producing an article that you cannot sell. We have tried in the past two years to reduce redundancies and to retrain workers. I do not think there is need for redundancies except to help people who are at the stage where retraining would impose too great a burden on them. Most of our workers would profit considerably by periodic retraining. The necessity for this comes about when the process has to be changed.
We have got to accept this, and the only hope for succeeding in retraining is to have a pretty strong economy. There should be money available from other sectors of the economy for retraining schemes and redevelopment schemes. By and large, I think we owe a commitment to our people that any of those who are required to undergo retraining due to factory closure or due to the necessity to change the product should have an assurance from the Government that during the period of retraining their pay packets will not in any way suffer, and that their families will not suffer in any way. Any group that are retrained will afterwards be a much more valuable industrial group and will be able to contribute much more to the economy than before their retraining. Their whole prospects should increase very considerably under a retraining scheme. It is really one of the outstanding hopes of the future that we have worthwhile and dynamic retraining schemes. Therefore, at all stages we will be able to have buildings and retrained people waiting to take on the new industrial processes and new factories that must inevitably come here as a result of our joining in the Common Market group.
There is the other side of the industrial arm, the home market. Here I think a great deal could be done to awaken the conscience of our people to the necessity to buy Irish and to support Irish. In this regard I think all the organisations, both the trade union movement and the farmers' organisations, could do a lot more than they have been doing to bring home to their members the necessity for supporting Irish industry, and also the necessity to make their complaints known in shops which try to hide the country of origin of the goods which they sell. You can see on their shelves articles, many of which are imported, displayed in such a way that the casual buyer could believe that they were home produced.
We have to take strong action in this matter. The necessity for action in it becomes more important if we are in the Common Market. The Government cannot take part in that, but this is a free country, with free association, and if the associations themselves through their members can do it the housewife, by taking her custom elsewhere, can very quickly enforce a "Buy Irish" policy. We must also play a part in the development of efficiency in our Irish industries. Indeed, that can be sadly lacking in many of them. It is no service to the nation or to the employees in such inefficient industries to allow them to carry on in their slipshod and old-fashioned ways.
By all means, we should at all stages insist on efficiency, insist on having the job done properly, but we should not take the easy way out that many are inclined to take and say: "Oh, well, that is an inferior article and we will buy the foreign article." We should buy the article but insist that the job be done properly and make our complaints known at factory level, publicly if necessary. If we do that, then I am sure we will really do a job in modernising the industries catering for the home market. Many of them have for too long used their protection shield as a reason for not advancing or for not being efficient.
That is the workers' side of it. There will be great opportunity, with new industries continually coming in, both to expand our industrial base and at the same time to replace those that have become outmoded. There will also be opportunities for workers who will avail themselves of retraining facilities, when offered, so as to become still better able to do a more complex job than they have been doing. All this adds up to great hope at that level.
The Government should be able to pour in large retraining funds. I know that the Common Market fund will contribute half the cost, but we will have to be prepared to pour in the funds necessary to compensate the families while the workers are being retrained. There is not the slightest objection to our doing that under any terms of the EEC. The only obstacle is our own lack of funds.
It is recognised that our social welfare standards are rather low despite efforts to increase them. The recent budget has been a very good example of that but we still have a long way to go and the family of the worker who is undergoing retraining are entitled to full consideration under our social welfare code.
As far as farming is concerned, there can be no doubt that the EEC offers a great opportunity for Irish agriculture. It is the opportunity we have been long denied. By contrast, the alternatives offer worse than the Economic War conditions to Irish agriculture. We have had a sorry history in agriculture because we are largely in the exporting market and we have no control over those markets. We had the disastrous Economic War of the 1930s and it took Irish agriculture a long time to recover from that. It coincided with a slump in worldwide agriculture conditions. In the 1950s and 1960s we had a kind of a stop-go policy because we depended on our markets to England. England embarked on a policy of cheap food and this meant that we had to subsidise our sale on the British market. After doing that we were still limited by quota restrictions, so that agriculture did not get a chance to expand. At one stage beef was regarded as being in slump.
Then three years ago the Government panicked because there was a worldwide surplus of dairy products and the price went down. Consequently we were selling butter at less than 5p per lb. in places in Africa. We even set up a reconditioning plant in Philippines because we could not even get what we had to sell into the British market at that time at the prices that prevailed there. As bad as the British market was it was the best outside the US that was available in the world for dairy produce. It is difficult to get any sizeable amount of product into the US. Whether the new negotiators who have arrived on the Irish scene will be able to do a better job with the American market I do not know.
Agriculture is now offered an opportunity for planned expansion. This planned expansion has been available in Europe since after the war and it has been available in England in the same period. The result has been that British and European agriculture has expanded during the last 25 years at more than 4 per cent per annum. In other words, 100 acres in Europe if producing £1,000 in 1940 today is producing on average between £2,400 and £2,500. That calculation is made on the value of money in 1940. It is a two and a half fold increase, whereas our increase has been less than 1 per cent. We have only had a 50 per cent increase since 1950, from £1,000 to £1,500, yet we have more potential than any comparable area in either Great Britain or western Europe, and given the opportunity we can do it.
In other words we can make up that leeway. The EEC is offering us the opportunity of doing it. For us it means that our expansion is now about to begin and the estimates made by various farming organisations and various specialist groups all pin-point our potential and the fact that we can easily average at least a 5 per cent increase in the next ten years if we get the conditions as offered in the EEC.
What is the alternative to that? If we do not go in there is no question of getting any arrangement with the Common Market for the sale of dairy products unless they have a shortage there, and this is unlikely. Even if it were likely, the sale would be negotiated on their terms. So the only product that we could hope to sell is beef. We have fought here against turning the country into a beef ranch, but make no mistake about it, if we fail to get into the EEC the only use we can make of our land is as a beef ranch with a consequent reduction in total output and consequently a reduction of manpower on the farm. Even then the price for beef would be substantially below what we would get if we were members of the EEC because we would have to pay a levy and a tariff. If we do not enter the EEC it would be impossible to continue to subsidise dairy products and to keep anywhere near the present price. Industry will require aids to get over the adaptations and the technological innovations required to provide employment, so where will we get the money for the development of agriculture? It cannot be done so the country would be forced into being a ranch.
What are the opportunities offered if we accept full membership? On last year's production figures for exports, which were around £170 million, we would earn another £70 million. The Government would no longer be called upon to pay subsidies which cost around £35 million last year. This year there is a reduction in that, due to the high prices prevailing for dairy products on the British market. If England goes behind the barrier and we are out we cannot calculate what subsidy would be required next year.
This is the situation at the moment. We are capable of this 5 per cent increase and it could well be exceeded in the early years. This 5 per cent increase in production means at least a 10 per cent increase in exports, because all our increased production is for export. We cannot consume any more dairy products at home. This is an exporting industry and the 5 per cent increase would mean that, over the transition period up to 1980, we would have a 50 per cent increase. A 5 per cent increase means a 20 per cent increase in exports. In a five year period that means over a 50 per cent increase. It means that the exports which would be valued at last year's EEC prices at £240 million, would increase by another £120 million.
We would have £120 million coming into the country and we ask what this means, apart from the increase in farmers' incomes. First of all, it means that the money is in circulation in the country. It is met by the various indirect tax laws at various stages, such as tax on petrol, beer, and so on. For every £100 put into circulation that way, the tax yield increases by about £40. An increase of £70 million would probably produce £25 million to £30 million additional tax yield. At the end of the period, when we have increased by another £120 million, 40 per cent of the gross, which is £240 million exports, would amount to almost £100 million.
We might expect that increased production in agriculture alone over the next five years would free the Government from having to pay subsidies, which would show a net saving of around £30 million. At the same time increased production over the period would go from £70 million at present to £240 million, giving tax yields of about £25 million to £30 million up to £100 million. This is money we did not have control of before. Last year's social welfare bill was £83 million. Our health bill amounted to £53 million. This money, if applied to social welfare, would enable rates everywhere to be doubled or spread around to create a spectacular improvement in all spheres. That is only the start because, if the income of the farming community doubles, then the Government will be looking for more taxation from the farming community. That is as it should be.
There will be income tax on farms and the Government will get a certain amount, whatever they think fair and equitable, from the increased return received by the farmer. This money will help to get our industry adjusted for modern technological change and modern competition. The key to the development of our industry and the key to uplifting our social assistance and improving generally our social services is to have agriculture on a prosperous basis, where it can relieve the Government and the taxpayer of paying the existing subsidies. By the additional foreign exchange it brings in, it will create a tremendous boost in tax returns to the Exchequer, which I have estimated at going from an initial £30 million up to £100 million at the end of five years. The farming community now become considerably more wealthy and consequently provides for the Government additional tax yields by paying income tax on their farms. All this adds up to a picture where industry and agriculture are complementary partners in getting us over the next ten years.
We cannot kill the goose which lays the golden egg, which is our agriculture. Agriculture will demand a great amount of capital over the next five to ten years if it is to realise its full potential over the next 20 years. The prospects are so good that a certain amount can be financed by external borrowing and a great deal more can be financed by co-operative finance between the various farming co-operatives and co-operative organisations throughout the country. Many small farmers are shedding crocodile tears and the more citified they are the greater the flow of tears.
We have got to be realistic on the question of small farmers. What is a small farmer? Anyone with 15, 20, 25, 30 or 40 acres could be classified as a small farmer. Most of such farms are operated by very elderly people. In the main there is no one to succeed them. The average age of those working on Irish farms, including the owners, is 57. One-third of those are widows.
At least half the farmers with under 40 acres have no succession in sight. They are bachelors. The children of those who are married have long since left the drudgery of the small farm and are working in Dublin, England or elsewhere. They are not going to come back. Even in the case of the 40 to 100 acre farm the succession is far from guaranteed. At least a third of those fall into the no succession class.
Our problem over the next ten to 15 years will be to find people to run the farms. There will have to be a great improvement in inducements on the small farms if we are to get people back to work them. That means the owners of the small farms will need a great deal of training. They will have to be assisted to develop their land by additional specialist advice and also to participate in schemes like family farm holidays in a united states of Europe.
At that stage it will be a very different situation from what we have today. It would be only a fool who would try to be dogmatic about what conditions would be like then or, indeed, what would be in our national self-interest provided that does not damage the prospects of world or European peace. Let us reserve the matter until then. Meanwhile let us keep the question on the low key on which it should be kept. Let us all join together in making a fresh start for the development of both agriculture and industry within the framework of the European Economic Community.
I congratulate the Government on the success of the negotiations involved. They have done a good job. I would have wished them to have involved the other political parties in the negotiations at an earlier stage. If that had been done, we would have had a more united approach. On 10th May the electorate, having read as much as possible on the subject, should think it out.
We have to come back to a basis of confidence in regard to the advice they are given. That means that those who supported the Fianna Fáil Party in the last election must face the issue that their party have made the case for entry. It is up to their supporters to show their confidence in the party on 10th May. Are they going to take economic advice from the party they support or are they going to take it from Mr. Tony Coughlan and the various wings of Sinn Féin on that date?
The flight from the land has been completely misunderstood and overplayed. We speak of a flight from the land of 10,000 a year when, in effect, most of that is in coffins to the local graveyards. In an ageing community of 250,000 people, such as the farming community, about 10,000 people die each year. This means that recruitment to fill the vacancies left is almost negligible. Some of the young people drift away from the land each year. However, this is happening in all countries although some of them are trying to curb this by improving the conditions and the opportunities on farms.
This is where I take issue with the White Paper. In its prognostications about the future it still accepts the inevitable decline in the farming population. It says, in effect, that deaths will go on at the same rate as they have been. That is taking for granted that we will have from 10,000 to 12,000 deaths every year. It further says that recruitment will not be able to replace this. Therefore, we will have a net loss each year of 8,000 or a 50,000 net loss over the transitional period.
This view of the White Paper does not really take into account the dynamic upsurge that must occur over the next five years. The farming organisations say that we cannot get from Irish agriculture its full potential unless we can maintain the work force on the land. They say, in effect, that the White Paper is wrong, that we cannot afford to lose 50,000 people off the land over the next five years. We will have to recruit and train young people to come back to a worthwhile career on the land by having all our farms developed in a modern way.
It will take a while to get across the message that there are good careers for those who specialise in agriculture, such as specialists in dairy herds. I am happy to take issue with the White Paper on some of their statements and to say that I believe their figure of a loss of 50,000 jobs in agriculture is wrong. I agree more with the views of the farming organisations and the advisory services that we cannot afford that loss. I believe the loss will probably be negligible over the next five years.
That is all to the good because if we do not have to provide for that loss in agriculture it makes the problem of the industrial arm much simpler. It means the new jobs will be in expansion and that therefore industry will not be overburdened with having to provide for redundancies in agriculture. I believe, therefore, the Government forecast for 50,000 new jobs over a five-year period is realistic, and provided proper emphasis is placed on keeping the jobs in agriculture, the figure of 50,000 new jobs is if anything an underestimate.
Of course, development in agriculture has to break with the past in so far as it must be based a great deal more on the development of co-operative centres from which relief services would be available to carry out the various tasks to enable the farmer to take a weekend off, or a week's holidays, or to do the milking, for instance, over periods of illness and so forth. Indeed many of the smaller farmers, I feel sure, will find much more fulfilment in working part-time in those relief groups instead of doing the work on their own with very inadequate implements on their farms. That is the picture that every progressive agriculturist today sees as being necessary for the full development of agriculture.
Then we turn to the question of food costs, about which a great deal has been written. Some very misleading pamphlets have been published. We have to examine this to see what the source is. First of all, the only produce affected will be dairy produce and beef. If we take dairy produce, it means the Government must find out in the next five years what consumer subsidy they are paying. That will have to be phased out. The consumption of butter here is given at 40 lb per head annually. This would mean an increase in price of 2p per lb in the next five years.
The only legitimate increase in the price of beef would be bridging the price up to the European intervention price, that is from £12 to £16 a cwt. over the five year transitional period. That means an increase of £1 a cwt. each year, which is 1p a lb increase liveweight, or 2p a lb deadweight. That is the average increase which should take place and there is no justification for any other increase. The increase per head for a man, his wife and four children over a four-year period should be in the region of £8. This is comparable to the relief in income tax which has been given to such a person in this year's budget.
A very important role can be played by the Prices Advisory Body in the transitional period because we must ensure that prices are not increased solely to take advantage of our entry into the Common Market. Those increases should not be based on the transfer of subsidies but should only be based on a genuine increase in raw materials. There should not be any increase in the handling costs involved. I hope that the trade union movement will see to it that over the next four to five years the prosperity that is generated by our entry into the Common Market will not motivate general wage increases.
Everybody outside the trade union movement should be adequately catered for, especially the social welfare group, the old age pensioners, the widows and orphans. They should be given increases in their benefits to compensate for any increases resulting from our entry into the Common Market. In fact they should get over and above any increases which take place. I believe all political parties share the view that social welfare recipients should be brought up to European standards as soon as possible and I believe they will all work to that end. The Minister for Finance is to be congratulated for his action in regard to those groups in the budget. That is only a small token of what we should be able to achieve in the years ahead when we get from our agricultural industry what it is capable of giving.
As pointed out in the White Paper, the lowering of customs duties for many products will probably mean a decrease in price so there is no justification for any scare that there will be a catastrophic increase in the cost of living when we enter the Common Market. We must try to control inflation during the foreseeable future. We have had an 8 per cent increase in the cost of living because of inflation during the last four years. We all recognise that inflation is far more serious than any increases that could possibly occur from joining Europe. It we could get inflation down to the range of 1 or 2 per cent, or even double that, I would feel we had gone some distance towards controlling it.
The main point that needs to be emphasised on the question of any anticipated increase in food prices here is that this is an internal matter. The increase is an increase that goes to the farming community for its products and, as such, the money stays within the community. If the Government feel that the farmers have got too much it is a simple matter to take some of this back from them and give it to the groups concerned. But, if the increase was occasioned by imports, then it would be serious because we have to pay for it and we would have no hope of compensating those who had to pay the higher prices within our own community. I do not think that point has been made. Any reasonable discussion of the food prices here concerns a substantially internal matter.
This is a question of transferred payments. Indeed, if you look at the other side of the picture, if you go back to 1962 or 1963 when our economy was going quite well, during the First Programme for Economic Development we were expanding quite satisfactorily at 4 per cent or 5 per cent per annum. All wage and salary groups participated in this, but the farming community were held at their existing prices. First of all, the price provided was governed by what it was on the British market. It had not gone up. Secondly, we could not put up the home price of dairy products because England was then threatening to operate a type of anti-dumping penalty if we put up the home prices and the result was that we had to keep down the home prices when justice at that stage would have demanded that the farming community should have participated in the 4 per cent or 5 per cent increase in real national income. This increase was available to every other group but they were not allowed to participate in it largely due to British policy. So now it works somewhat the other way. In many ways, had they been allowed to get that, there would be no need to make this adjustment at this stage.
However, be that as it may, I want to emphasise that what is involved in increased food prices is a transferred payment from the public to the farming community. Up to this the public had been meeting part of that by means of subsidies paid on dairy products to the farming community. Now they will not have to pay those subsidies. The transfer payment is more direct. But the Government are always arranging transfer payments and will always have the primary function of arranging transfer payments between various sections of the community. I, for one, have no doubt that any Irish Government will see that justice is done in this regard and that no one involved in paying the higher prices will suffer from it and that, if needs be, taxation on farms will more than compensate for such increases and provide the means by which transfer payments are made to the other sections.
But, of course, in this we have to be very careful not to overestimate the position, because if we are really to expand in the future we have got to plough in capital to agriculture. We have to reconcile two things. We have to reconcile the need for capital in agriculture with the need for ensuring that those who have to pay increased food prices are compensated. Indeed, the present budget more than did that. If the next budget does as much as the present budget has done then it is absolutely certain that all groups will be better off than they are at present. I think, therefore, we should have no fears for the future in that regard.
We must realise we are a small community here—a republic of three million people. It behoves us to work together, to develop the resources of our country and to see to it that the less fortunate sections of our community —the social welfare groups, the widows, the orphan, the pensioners and so on—are all properly catered for and that their present position is quickly and radically improved. It also behoves us to see to it that we value our two greatest assets. The first is our land, which is second to none. Because of our climate's suitability for the growing of grass and the decreased need for housing on farms and our relatively higher winter temperature our potential for development is second to none in Europe. Therefore, let us have confidence in that and let us help it develop.
The other factor we must recognise, equally with that, is that our future depends on our trained manpower. They must be trained at every level, from the lowest to the highest. The training of manpower in the modern industrial sense calls for a force that periodically has to be retrained either within its own factory to undertake new processes or to change the type of work it is doing. Let us realise it is in the interest of everyone to see that this retraining is carried out and that the family concerned does not suffer in the retraining. That is an obligation we have to all our people. If we do that I have no doubt whatever but that we can compete successfully with any group anywhere and that we can develop our country to play its part in the development and fashioning of the new Europe.
But I must conclude by stressing the fact that what we are asked today is a very limited question. It is a question of whether we believe that this trade pact is for the betterment of our community. When we see the many great advantages, and probably some disadvantages, I think there is no question but that the overwhelming balance of advantage lies with going ahead.
Where we go if we do not accept this, I cannot picture. With our main markets in industry and agriculture gone behind tariff walls we would face a return in agriculture to the Economic War conditions of the 1930s. In industry we would have a shock that would make the 10 per cent levies put on ten years ago in England seem insignificant. Also we will have an opportunity of making our contribution to the fashioning of a new Europe. Let us reserve our position completely as individuals as to what we will do if and when, in ten or 15 years time, a treaty comes before us to join the political united states of Europe. At that stage there will be a very different situation from that existing today. Only a fool would try to be dogmatic about what conditions will be like or what would be the best in our national self-interest to do, provided that our national self-interest does not damage the prospects of world peace or of European peace.
People must ask themselves on 10th May: do they follow Fine Gael or Sinn Féin? When it comes to the followers of the Labour Party and the trade union movement they must realise that the labour movement, alone of the three main sectors involved, is the one which is openly split on this question. There is no evidence of a split anywhere in the Fianna Fáil Party. There is a one-man monetary reform in Fine Gael. In the Labour Party there was a 40 per cent vote pro-EEC at its congress. The outstanding memory of that congress was the appearance of the late Senator James Dunne, of whom no Senator in this House had a higher standing, when he came from his sick bed to make that heartfelt plea which was tantamount to saying we were better in the EEC than outside it. Mr. Larkin also spoke in favour of membership. Labour supporters must realise that it is an issue on which there is no clearcut decision in their party. Sixty per cent for and 40 per cent against membership would be an inconclusive result. Deputy Corish has made it quite clear that they share none of the opposition mooted by the Sinn Féin group and others and that their sole concern is that we are not ready for full membership. The Labour Party have not, however, given a credible alternative. The alternative given by Deputy Corish in today's paper is exactly the same for industry as it will have under full agreement, without access to the regional fund or any say in the deliberations. What does Deputy Keating offer for agriculture? What he offers is a beef ranch here for Western Europe. That is no alternative.
Finally, if some unforeseen circumstances should arise over the next few years, as a result of joining the European Economic Community, the protocol gives us the right to demand all the special treatment we require to ensure that the policies of all parties in this country—raising the standard of living to that of those in Europe and developing the West and other regions —are not jeopardised. We should be thankful for what has been achieved and look forward with confidence to the next ten years. Let the period after that be judged later. We have enough work to go on with for the next ten years. We have got a ten-year period for fisheries and that is as far ahead as we can look in the troubled world of today. We can be confident that the electorate will respond in an overwhelming manner to the rational case put before them. They will not be misled by the outrageous documents which suggest that because the price of tea is 40p per lb here and 120p per lb in Brussels we will be paying such an increase in its price. Tea will be bought in exactly the same market under the same conditions, if we are in the Common Market, as it is being bought today.
I would appeal for an end to this misleading type of scare propaganda. The electorate should be allowed to see the issue for what it is. My advice to the electorate is, if you place your confidence with groups or with people, whether they are in vocational organisations, like the national farmers' organisations or the creamery milk suppliers, or with political parties such as Fianna Fáil, Fine Gael or Labour, look to these bodies for your guidance, but remember that the Labour Party is also that of the late Senator James Dunne and Mr. Larkin as well as that of Deputy Keating.
