Tuesday, 21 May 1935
Dáil Éireann Debate
Mr. Belton: I remember that last year the Minister for Finance, in his Budget speech, struck a very optimistic note as he did this year. He went over all the items producing revenue by indirect taxation, and he pointed out that it was evidence, which I agreed with and still agree with, of the economic strength of our people, and evidence of the fact that conditions are improving. I wonder was the Minister prompted by the opposite feeling this year because, in referring to those items he dealt with them with greater modesty than I have ever heard him do so in this House. Almost apologetically, he referred to the taxes that, in some cases, did not come up to expectations, and to some that were less than last year—some, in fact, that were less than the corresponding figures for 1931-32. Why did not the Minister adopt a plain straight line and take some one year for the purposes of comparison—preferably last year, because we cannot put back the hands of the clock three years? Two or three years have intervened since 1931-32, and the nearest approach to the conditions this year must be last year. I have already said that, taking everything into consideration, it is a good thing for the country that such a Budget has been produced because it is an indication of the present economic condition of the country.
Mr. Belton: I notice, in examining the Estimates for the year that we are in—the figures relating to estimated expenditure and the Estimates relating to new taxes—that for some reason the Minister consistently seems to overestimate the cost of the Services and to underestimate the produce of taxes. Of course, the Minister can gather the last halfpenny in the country by taxation that way, and balance his Budget though the country may be tottering. Let me take some examples from his Budget speech. He said that the loss to the Exchequer last year, following the reduction of 4d. per lb. in the tea duty, was £400,000, while the reimposition of it this year will only bring to  the Exchequer the sum of £320,000. The same applies to a number of other items. Last year the revenue budgeted for amounted to £28,232,000, and the sum collected was £28,770,688. Borrowing was estimated to be £7,212,000, but actually it did not reach anything like that figure. If the Minister set about giving us a balance sheet of all the transactions, I doubt if his Budget would balance. The Minister got authority in his Budget last year to spend considerable sums of money under many headings, but he did not spend the money. The taxation for which he asked authority from this House, however, was given on the assumption that those works were to be carried out. Take one example— the widows' and orphans' pensions. The sum of £250,000 was estimated for the last year for that purpose, but was not spent. There was also a sum of £1,000,000 for the payment of the External Dáil Loan, but only £78,000 was spent. The sum of £4,200,000 was estimated for Local Loans but there was only paid into the Local Loans Fund the sum of £400,000 instead of that £4,200,000. And so on in that way with numerous items.
The Minister knows that, in various branches of local government their budgets must be compiled on the basis of the work to be done, and authority is given to the executive officers to do that work within their appropriations. If they do not carry out the work, they must show a saving to that amount. The Minister has not gone on those lines at all. In many cases this year, for no apparent reason that I can see, his Estimate for last year in actual expenditure was not reached; and yet, in many of those cases, he increases the Estimate for that particular service this year. He estimated the expenses of returning officers last year at £6,000, but spent only £675. Another expenditure was £4,000 below the Estimate of last year and is about £40,000 above the Estimate this year. The Estimate for the repayment of Dáil Loan last year was £1,000,000, of which only £78,000 was spent, and £450,000 is to be paid this year. For the Revenue Commissioners the Estimate  was £750,000 last year, of which only £661,000 was spent, and there is an Estimate of £725,000 this year. Local Loans Fund was estimated last year at £4,200,000, but only £400,000 was paid. I should like to know from the Minister if that was not an actual payment from current moneys during the last financial year, or was it simply a book transfer of capital assets that he estimated in conformity with the recent Bill that was passed here? From my reading of the Minister's speech, I take it that that was not a money transaction at all; it was simply on account of the capitalised assets against the revenue that the Local Loans Fund will receive under that recent Act.
The Estimate for Public Works and Buildings last year was £687,000, of which £685,000 was spent; and he has estimated this year for £889,000. Then, take the case of the produce of the taxes that the Minister expects to get from his new impositions. The duty on tobacco is an Excise duty. Roughly, our consumption of tobacco is about 12,000,000 lbs. and, at 8d. a lb. that would give £400,000; but the Minister estimates that the produce of that tax will be only £160,000. What is going to happen to the £240,000? Where does that go? Then, there is a duty of 6d. per cwt. on imported wheat. I should take it as a rough estimate that our requirements in wheat would be about 16,000,000 cwt. Let us say that the home supply would be the produce of 150,000 acres producing an average crop of millable wheat. I have heard, and I am prepared to believe, that the area under wheat this year will be more than 150,000 acres; but, taking it all round, I think that it is a good high estimate to place the supply of home-grown wheat that will be of fairly good millable quality at the total produce of an average crop of 150,000 acres. Assuming that there would be one ton to the acre, that would leave the total import of wheat for our requirements at 13,000,000 cwt, and 6d. a cwt. on that would be £325,000. The Minister, however, estimates only £190,000. I think that if the Minister found it necessary to put on taxes of this kind, he should have gone far more  moderately about the taxes. The Minister puts sugar at £175,000—that is, at one farthing a lb. I think that it is a conservative estimate to place our total consumption of sugar at 100,000 tons. A farthing a lb. on that will give us £140,000, but the Minister estimates only £75,000, and he will have £65,000 of a lie-by in that one item alone.
Now, with the consistent policy of the Minister in over-estimating the cost of work to be done and under-estimating the produce of taxes that he is about to impose, and, presumably, under-estimating the produce of taxes in the coming year, he is taking undue precautions about the balancing of his Budget—precautions, which are very significant in my opinion. It is an indication that the Minister is very nervous of the economic position. From existing taxes which produced £28,770,688 last year he wants this year, even with his high estimation, £29,376,000, or about £500,000 more. Why does he find it necessary to impose so much taxation? Does it not betray nervousness? The taxes that produced so much last year have shown a decline. The Minister is frightened that they are going to show a greater decline during the coming year, and consequently he is budgeting for a revenue far in excess of what he might budget for if times were normal, or if he had any confidence in the situation.
I notice that we have £1,500,000 for unemployment assistance this year. That must be food for thought for my friends on the Labour Benches. It must be a sad disappointment for the Minister to find that he has to pay so much money for unemployment assistance and unemployment insurance in the current year, notwithstanding the money he has devoted to relief schemes and the amount that he has decided in this Budget to spend on public works during the coming year which, he says, fairly correctly is an additional help for unemployment relief. But how does that square with his apologia for the decline in the produce of the taxes? He said it was because of the rapid expansion of our tillage and industrial policies. But the rapid expansion of the tillage and industrial policies, if  they were rapidly expanding, should be absorbing unemployment to a greater extent, and that absorption should be indicated by a decline in the necessity for relief works, unemployment assistance and unemployment insurance. There is no indication of decline there. Therefore, the demand is remaining about normal. This great expansion of the tillage and industrial policies, which the Minister talks about, seems to make no impression on unemployment. We have still to pay for that. How then does the Minister account for the fall in taxation? The rapidly expanding tillage and industrial policies are not absorbing the unemployed. If they were the produce from taxation should be rising instead of falling. As was indicated in the Minister's speech, it is falling, and, therefore, purchasing power cannot be increasing. Even that item which nearly intoxicated the Minister last year, beer, “had bucked up,” to use his own phraseology, in sympathy with all the other items of taxation, and produced not only the quota of previous years that he had looked for, but a figure that far exceeded the estimate for a number of years. This year, when speaking of beer, the Minister did not get intoxicated. His references to it were very sober. It seems that there must have been no advance made in the brewing and sale of light beer. The whole speech of the Minister was a wail, indicative of the economic position in the country. He professed to give us a balance last year and this year. I think the amount of the surplus this year was £120,000.
Mr. Belton: The Minister is to borrow for export bounties. The Minister suggested that he should also borrow for the other items. I agree that borrowing is sound for all these items, but I do not agree that it is sound to borrow for bounties. My friends on the right suggest that the money should be raised by taxation.
Mr. Belton: I should like to ask the Minister, and, through you, Sir, the  Labour Party, to deal with that. The British Government told us what they are doing. Roughly, we know the amount of money going into the Exchequer that normally did not go into it some years ago. There has been no relief in taxation because of the land annuities, local loans revenue, and the produce of taxation that went to pay the Royal Irish Constabulary pensions. There has been no relief of taxation there, but the Exchequer is getting the advantage. The sum is considerably greater than the amount of the bounties paid any year since the bounties were started, or greater than the amount estimated for bounties this year. Why are bounties not paid out of that money? In my opinion that shows the rather dangerous economic and financial condition of the country.
The Minister was very careful to warn critics of his Budget against anything that might damage the credit of the country. I do not want to indulge in anything that would be damaging to the credit of the country, especially I want to avoid using any language of a certain nature in this House. Any language of that kind used in this House, no matter who uses it, will be more damaging to the credit of the country than if that person used it outside. I do not want to be guilty of anything in the nature of damage to the credit of the country. The Minister in the course of his speech reminded the House of the rate at which certain bonds or stocks could be marketed in Britain. Some of these run up to 110, while in this country similar stocks bearing the same rate of interest were not even at par. The Minister could not understand why. I will tell him. In Britain the economic life of the country is reviving. In the Free State it is not. If the Minister by overestimation for expenditure and underestimation in the production of taxes could continue balancing his Budget it will avail him nothing. It will avail him and his Government nothing and it will avail this country nothing unless the economic condition of the country outside is being balanced.
The Minister gave us a balance last year. He attempted to balance this year on a net increase in the national  assets over the last three years. The Minister showed on paper that we are in a better financial condition now than we were three years ago by £3,000,000 to £4,000,000. But the Minister fails to bring into that statement an account of the money withheld in the shape of annuities and other payments in Britain during that period. I am not saying that the money should be paid out but I am saying that the Minister has the benefit of these moneys and he did not show them in the account. But the country outside has to bear the loss of this. The country outside has to bear the loss in the shape of a capital levy and that is telling on the country now. It is telling in the Budget under review by reduced produce in taxes because of the diminishing purchasing power in the country due to the diminution of national income. The Minister knows that. He has shown it in his mad race to impose more taxation. The amount collected in taxation last year was only £500,000 less than his estimate for this year. The Minister attempted to balance his Budget and says he balanced it for this year. In the course of the year he got a windfall. Every Bill that is passed in the Dáil imposes on the people in the business the necessity to register. In making application for registration one has to enclose a fee. If one looks to the right or to the left, one commits an offence; a fine is imposed. Every twist and turn that one gives means money. Now all that finds its way to the Minister. At the time when the Bill was being passed we were told that all that money will be for the benefit of the industry in connection with which the Bill is enacted whether it concerns agriculture or anything else. When the Stabilisation of Bacon Prices Bill was passing through there was placed an imposition of 10/- per carcase. That was the sum imposed on the pig carcase, of course for the benefit of the bacon industry. That, we were told, was to be only temporary. When the Bacon Bill was enacted and in operation with this imposition of 10/- a carcase was to go out automatically and the other to come in. At the time the Minister for Finance was indignant at the thought that anyone would think  he would have anything to do with this, except that as Minister for Finance, he thought it well to have the finances of the Government of the State centralised. The Minister said afterwards, “I will not let this go.” Then with the persuasion of the Minister for Agriculture he would let it go, but not yet. During the course of the year he says he will liquidate it and he tells us it will cost the Exchequer £240,000 to £250,000. Now that was in connection with the levy that was supposed to be for the benefit of the bacon industry only.
That fact in itself should set everybody in this House and outside it thinking. How much has the Minister collared out of every Act of this kind that has been passed through the House? I am sure the Minister has his hawk's eye on every Act with a view to getting the most he can out of it. All these Acts which are supposed to be for the relief of agriculture, are primarily revenue-making machines for the Government. This levy of 10/- on pig carcases has produced £240,000 to £250,000 for the Minister for Finance. The Minister used a significant phrase about the remission of that tax. He said he would not remit it finally until the Pigs and Bacon Bill was enacted and in full working order. In other words, if he spoke his mind he would say: “I will not let this tax of £240,000 go until I see how I can collar £240,000 from the Pigs and Bacon Bill when it is an Act.” I am sure that is what is in the Minister's mind. He will take good care he will not lose this money. It gives him another nest-egg and will allow him to take so much money from the economic life of the country.
Another nest-egg he has is in connection with the bounty on wheat. Who is suffering the loss there? The Minister should show a reduction in his Estimate and a reduction in the necessary revenue that he wants this year. By taking his own figure, which is on the safe side, we may put the reduction at £260,000. That is a net saving for the Minister in this coming year.
The items for widows and orphans is not an increase, because he estimated  for it last year and he collected revenue on the assumption that the Bill would be enacted and in working order for such portion of the year as would cost this Government £250,000. He estimated that for a full year it would cost £400,000, but for that portion of the year it would represent an outlay of £250,000. The Minister estimated that that measure would be in operation last year, but it was not. We are just in the same position this year as we were last year. Still the Minister mentioned it as a new item of expenditure. Probably he has not the cheek to delay its enactment any longer than some time this year. But it is not an increased item of expenditure as far as the Budget is concerned, because the Minister budgeted for precisely the same amount last year that he is budgeting for this year—£250,000.
The Minister will have no new expenditure except £40,000 for the wheat bounty. I do not know where that £40,000 is going to be swallowed up, except it is to cover costs in the early portion of this year before the new harvest comes in. Otherwise, in a normal full year, I see no need for an expenditure of £40,000 from central funds for a wheat bounty, because we are just as we started before the wheat bounty. There is a quota for a certain amount of wheat and then the people compete for the quota. On the whole I think the Budget is the greatest danger signal that this country has seen for a long time.
Mr. Belton: I must accept some of the responsibility for teaching him to follow on the line of protection. The Minister betrayed nervousness in  rushing these taxes. In his boastful speech last year he indicated—I agreed with him then and I agree with him now—that from the bumper harvest he had from taxation he was justified in being optimistic. But the converse is true this year. The taxes that exceeded expectations last year are considerably under expectation this year, and the Minister is budgeting in the anticipation they will be considerably less than during the year which has closed. That reflects the economic condition of the country. The development of our tillage and industrial policy as an excuse for that will not hold water, because if we were developing to the extent mentioned by the Minister, it would be reflected in an increase in many of these taxes in which there was a decrease. Last year, he said that we drank more beer because we were more prosperous. This year we are drinking less beer. Is it because we are more prosperous?
Mr. Belton: An empty pocket is the best thing to make a man or a nation temperate, and the “pocket pledge” is what has made us more temperate this year. The Minister for Finance is the man who will administer that pledge. He knows it is operating. Hence the multiplicity of taxes—taxes that normally would produce three times the amount of money the Minister is looking for; but he anticipates a decrease in the other taxes. The case made for industrial development here would be understandable if we were near saturation point— that the taxes from the imports of protected commodities are dwindling. But these are not the only ones from which there is a dwindling return this year. However, I will not take up much more of the time of the House.
Mr. Belton: I hope the Deputy will give as much thought to it—more intelligent thought than I have given to it. I am sure if he does, and expresses it here we shall all be glad to listen to him. But he will not get over the  position of the country revealed in this Budget by any cheap scores or cheap jibes for Party advantage.
Mr. Belton: Nobody can say that with more emphasis than the Minister for Agriculture, and I am glad that he appreciates it. I will be interested to hear the Minister further on his gymnastics in balancing his Budget. I feel very doubtful about it. I would also like to know why he refrained from borrowing this year, and why the £4,200,000 that was to be borrowed and placed at the disposal of local authorities for housing was not borrowed and placed at their disposal. He is saving a very important item of expenditure in the current year in the service of the debt that he is forcing the local authorities to shoulder under the recent Local Loans Act.
The service of that debt he estimates at £1,330,000. Instead of the Exchequer bearing the cost of that in future, the local authorities, who will be borrowing from the Local Loans Fund, will have to bear it. I am sorry I did not hear the Minister for Industry and Commerce on this. When I came into the House he was talking about boots and shoes, about the rapid development of his industrial policy, and stating that because of that rapid development certain tariffs were not producing revenue in the way they were. My view as to why those tariffs are not producing the revenue is simply  that the people are not buying, because they are not able to buy on account of the economic condition into which they are driven. The bottom is falling out of the market, and the Minister for Finance is subconscious of that, as is indicated in the taxes which he is imposing in this Budget.
Mr. MacDermot: Sir, the two principal speeches which we have heard so far in defence of this Budget have been from the Minister for Finance and from the Minister for Industry and Commerce. While they differed in many particulars they had this much in common, that the passages of both speeches which excited the enthusiasm of their supporters bore remarkably little relation to the actual Budget proposals, and remarkably little relation to the actual facts of the country's economic condition. The Minister for Finance's flowers of rhetoric about the responsibilities of freedom, and the periods of the Minister for Industry and Commerce about the redistribution of wealth in this country which is to be effected by taxation, seemed to have very little to do with the proposals which the Minister for Finance has put before us in this Budget. The truth of the matter is that both of them were conscious of the fundamentally unpopular and, I would say, inequitable character of the taxes which are being introduced, and having a profound belief in the value of bluff, a belief based on their happy experience in the past, they thought that, so long as they went on talking as if the proposals of the Budget were quite different, the gullible public would hardly notice what the proposals actually were; that so long as they went on whistling the “Walls of Limerick” none of us would observe that they were really dancing the Tango. I hope that in the course of this debate there will have been enough in the way of criticism not only from our benches but from those of the hitherto silent Labour Party to enlighten the minds of the people of the country on this topic.
The Minister for Industry and Commerce spoke with more than his usual scorn and arrogance about the shortcomings  of the Opposition. We were, taking us all in all, the most depraved and the most incompetent Opposition that ever sat at any time in any Parliament in the world, while he, of course, was the best Minister in charge of the best Department in the best Government that had been known in Europe. I felt properly chastened after the castigation I had received from the Minister for Industry and Commerce, and as it was my intention to take the first opportunity of addressing this House on the subject of the Budget, I determined to try and model myself on him. Accordingly, I examined his speeches on the four Budgets that were brought in by the predecessor of the present Minister for Finance, but, alas! I emerged from that study a disappointed man. I could find there none of that tender care for the credit of the country which is now so warmly recommended to us. I could find there none of that constructiveness in which we are blamed for being so lacking. I found that if I were to model myself on the Minister for Industry and Commerce in relation to Budgets when he was in Opposition I should make wild and reckless statements; I should make predictions which in every case had been falsified; I should make promises which were never carried out; I should enunciate principles which as soon as I came into office I made haste to abandon. If those are to be the qualifications of a successful Opposition I prefer to continue humbly in an unsuccessful Opposition. If our Opposition is unsuccessful, I prefer to continue unsuccessful on honest lines rather than to win elections by hocus pocus and bluff that have to be forgotten about as quickly as possible as soon as you get into office.
There are three questions which I think can properly be discussed in a Budget debate. The first is: “What is the general economic and financial condition of the country?” The second is: “Is the Budget fiscally sound?” The third is: “Is it fair and just as between the various classes of the community?”
The bulk of the speech of the Minister for Industry and Commerce, so far as it was not devoted to rating the  Opposition, was devoted not to a consideration of the Budget proposals but to proving that the country as a whole is in a good condition. For that purpose he used a large number of statistics. Let me say at once that I have a wholesome distrust of statistics, and that while I am going to set up against his statistics other statistics, in the last analysis I am much more impressed by actual experience—by contact with the various classes of the community and experience of what they are undergoing—than I am by any sets of statistics. However, I propose to go briefly through the figures which the Minister for Industry and Commerce put before us, and then supplement them by some figures of my own.
One figure on which he laid great stress was the number of people put into industrial employment by the present Government. That is the only one of his figures which I am going more or less to neglect, because Deputy McGilligan is going to speak later in this debate, and that particular topic of employment figures is one from which he derives special recreation and refreshment, so I propose to leave to him the task which he has performed before of analysing destructively the figures in that regard. I will merely remark that even if I accepted the Minister's figures at their face value I would still contend that, considering the enormous tariffs which have been put on, the enormous amount of relief money which has been expended in giving employment, and the general policy of inflationary spending for which the Government has been responsible, the amount of confessed and admitted unemployment still existing in the country is nothing short of appalling. Even accepting the Minister's own figures, the record of the Fianna Fáil Party in connection with unemployment has been a complete disappointment to any of those who were foolish enough to believe their statements and predictions on the subject before they came into office.
Another figure from which the Minister derived encouragement was that of the passenger and goods traffic on the railways which, he stated, was increased this year from last year and  last year from the year before. I think anyone will agree, on reflection, that the improvement in the railway traffic has been very largely due to the Transport and Railways Bills which the Government have passed, and which I supported at the time they were introduced. The monopoly thus given to the railways has had a very great deal to do with improving their position. But aside from that, it is a matter of course that the beet policy and the flour policy of the Government have resulted in a far larger transport of sugar beet and flour than was going on before the present Government came into office. That is a thing that followed automatically and mechanically, and, therefore, it is no index of the general prosperity of the country. There are other occasional and fluctuating features that affected the railway traffic. One is the Dublin Tramways strike which has just concluded. That must have been of very great assistance to the railway figures, I should have imagined.
Mr. MacDermot: Then there is the question of the weather. It is the experience of the railways as regards passenger traffic that in the fine weather the traffic increases enormously. People go away on Saturdays and Sundays, especially in Dublin; they go out of town in fine weather—they do not go in wet weather—and the fact that on the whole the weather has been better than the average, doubtless owing to the virtues of the present Government, has contributed towards improving the railway traffic. On the whole, I think there are quite enough of these occasional factors which I have mentioned, and of factors which are automatic as a result of the Government protectionist policy in relation to sugar and flour, to account for the improvement in the railway figures without deriving therefrom any conclusion as to the general prosperity of the country.
Another figure on which the Minister laid stress was that of Dublin bank clearings. I suggest that figure shows  next to nothing as to the increase or decrease of the assets of the country. There, too, the greater activity in bank clearings is an inevitable result of a protectionist policy. Payments are made here that would otherwise have been made abroad and the bank clearings are accordingly increased.
Mr. MacDermot: Another point on which the Minister laid stress was the increased consumption of shoes, not in value but in the number of pairs that were actually consumed by purchasers during the year. I cannot feel that is a very conclusive figure because, after all, it may mean—I do not say it does—that the shoes are of inferior quality and do not last as long, or it may mean, again, that there is a transport strike on and people have to walk so much that they wear out their shoes quickly.
Mr. MacDermot: At any rate, I cannot regard that shoe figure seriously as proof of the country's prosperity. Let us turn to some other figures. The Minister for Industry and Commerce has spoken of bank clearings, but there are some other figures available in connection with banks. As a matter of fact, the Irish Independent forestalled me this morning by mentioning them in its leading article. One is the total of bank deposits. The total of Irish Free State deposits has sunk considerably.
Mr. MacDermot: I was informed, at any rate, on extremely good authority that, as compared with the period  immediately before this Government came into office, there had been a considerable fall in deposits of Irish Free State clients of Irish Free State banks. Then there is the banks' excess of sterling assets over liabilities. There is no question that that has sunk as compared with this time three years ago. There has been a fall of about £8,000,000 in the excess of sterling assets over liabilities now as compared with the figure for that excess three years ago. We are £8,000,000 worse off now than then.
Mr. MacDermot: The Minister for Industry and Commerce is very fond of telling us that the volume of overseas trade is no index of prosperity at all. I cannot accept that view, not for a moment. I am prepared to admit that, taken by itself, it is not absolutely conclusive, but still it is a very important factor. The value of our overseas trade has fallen calamitously since the present Government came into office. It has fallen by about £28,000,000 per annum.
A still more significant guide to us is the adverse trade balance. At present the adverse trade balance is over £20,000,000 a year. I am quite aware of the fact that that is not the whole of the picture, that there are invisible items to be taken into account, too. To resolve what is really the adverse balance, taking visible and invisible items, is a very difficult problem, a problem on which I think all the experts are waiting to hear the conclusions of the Banking Commission which is at present sitting. But what you can do is to see the general trend of the last few years, and there is no question at all that that trend has been unfavourable. When the present Government came into office the  adverse trade balance was less than £12,000,000 per annum. Even at that figure it was made a very great deal of by the propagandists of the Fianna Fáil Party. Nowadays they treat the adverse trade balance as something of no account at all, but they used to take a very lurid view of it. When the volume of our overseas trade shrunk by 33? per cent., you would naturally have expected the figure of the adverse balance to shrink proportionately. Instead of being £12,000,000, you would have expected it to go to £8,000,000. As against that, it has, in fairness, to be admitted that our position on the invisible side was improved by the retention of the land annuities and that the visible trade balance was made worse by the fact that the English collected the land annuities in the shape of tariffs which meant lower prices for agricultural goods, so that I take it that it would be fair to add on approximately £5,000,000 to that £8,000,000. If, therefore, the adverse balance to-day stood at £13,000,000 instead of the £12,000,000 at which it stood when the Government came into office, we might perhaps have said that the figure showed no deterioration; that it showed no improvement but it showed no deterioration. It stands, however, in fact, not at £13,000,000, but at over £20,000,000.
The Minister for Industry and Commerce attempted to prove that a part of that was accounted for by the fact that we were making exceptional importations for the purpose of founding new industries which would not recur in future years. I do not believe that. I believe that if the industrial policy of the Government goes on and has any success, similar importations will have to continue for a great many years to come, and for so many years to come that it is no use for us to look forward to a period when such importations will not be taking place. Consequently, I cannot agree that we should wipe out a portion of that £20,000,000 on that score.
That is the situation so far as it has gone up to the present. What is it  likely to be for the future with regard to that adverse balance? I suggest that there is every reason to expect a progressive deterioration if things go on as they are going at present. It would have been a problem, even if the present Government had not come into office at all and even if they had not started their disastrous policy of ruining agriculture and ruining our export trade, that tended to get more serious than it was, for this reason, that very large payments are coming into the country at present which will, by degrees, be extinguished. The money coming into this country from Great Britain for Army pensions and for R.I.C. pensions will not be coming in for ever. Those moneys run into £3,000,000 or £4,000,000 a year, and they make a very substantial item, of which account has to be taken. Then there is money coming into this country from America that will tend to diminish because emigration to America has stopped. It is the young people who have gone out to America who are the people likely to send home remittances to their fathers and mothers, and, as their aged relatives die off, these remittances will stop. Then there is the question of residents in Ireland who derive their incomes largely from investments out of Ireland. Is it not a fact that those people will tend to diminish in numbers so far as we can see? There are many people, elderly people, still living in this country because they have always lived in it, and because, at their time of life, they do not feel inclined to change, who will not be succeeded by their children and whose children will tend to live elsewhere because their presence in this country is not encouraged and because they are not sympathetic, rightly or wrongly, with the general political trend of the Party now in power. Of course, the day may come when the Party which is now in power will be out of power, and when there will be a more sympathetic feeling on the part of such people as I describe.
Mr. MacDermot: At any rate, people act on what the conditions are at the present time and not on what they hope conditions may be in a year or two, and the Government certainly which is formulating the Budget and which hopes and expects to stay in office indefinitely must proceed as if it was going on with its own policy.
That suggests to us another reflection. The Minister for Finance talks about expenditure such as we are presented with as an example of shouldering the responsibilities of freedom. What additional expenditure must we expect when we come to shoulder the responsibilities of the larger freedom? It was a bit of a shock to hear a member of the present Government referring to our present condition as freedom at all, because they are fonder of painting us as slaves and asserting that we have not yet attained independence and that we have, in some mysterious way, to conduct a fight for it; but is it not plain that if they have any spark of belief in their own predictions about the Republic they should be preparing for the day when our financial system will have to stand even greater strains than are being imposed upon it at present, and when such matters as the adverse balance, which we have just been discussing, are likely to be very unfavourably affected by the political developments for which the Fianna Fáil Party hope, or pretend to hope, to be responsible?
So much for the balance of payments, visible and invisible. Before I turn to the indications given by the Budget itself, there is one more test which appears to me of very great importance, which Government spokesmen have neglected altogether. What is, even to-day, in the opinion of every Deputy in this House the main source of wealth in this country? Is it not land? Is there any single person who would deny that? What has been the effect of the present Government's policy on the value of land? How is it that neither the Minister for Finance nor the Minister for Industry and Commerce in their very lengthy speeches ever thought of even alluding to the effect of their policy on the  value of land? Is it not a fact that, in most parts of the country, land has become almost completely unmarketable and that it certainly would be on the conservative side to say that land had depreciated 35 per cent. in value——
Mr. MacDermot: Let us turn to the indications given by the Budget itself and to the speech of the Minister for Finance in introducing the Budget. The Minister for Industry and Commerce has spoken as if this country was flowing with milk and honey and as though we were having a boom here unprecedented in the annals of the Irish people. If that is so why is there a deficit at all—because, do not let us forget, a deficit there is. When we say that the Minister for Finance has a surplus what do you mean? You mean that if the taxes were maintained at the same level as the preceding year, there would be more than enough to pay the expenses in the year to come. If you say he has a deficit you mean that if the taxes in the year to come were maintained exactly at the same level as the year before, they would not be sufficient to  pay for the expenses. The Minister for Finance talked a few weeks before his Budget of being in the position of having a comfortable surplus. Instead of that we find him piling on extra taxes.
The Minister for Industry and Commerce said the yield of taxation had been well maintained. Is that true? Which are the taxes that gave so much satisfaction? What is the description of the Minister for Finance himself of the situation with regard to income tax and estate duties, which are perhaps as good an index as any? His description of the situation is that there has been “a notable shortfall.” And mind you, the Estimates of the Government as pointed out in this House over and over again by Deputy McGilligan, in regard to the yield of income tax were extremely pessimistic, compared with the Estimates in former years, as to the amount produced by threepence or sixpence on the income tax. Yet from these pessimistic Estimates, there has resulted a notable shortfall from income tax and estate duties. There has been an increase in the yield of corporation profit tax, but after all that is only to be expected, because there has been an increase in the number of corporations, owing to the protectionist policy of the Government. With regard to corporation profit tax I wish to repeat what I said two or three times before, that I regard it as one of the most unjust and indefensible taxes and one that ought to be abolished because it is a case of imposing income tax twice over— first on the corporation and then on the shareholders. There has been an improvement in the yield of excess profit tax, but that throws no light whatever upon the present economic condition in the country, because it is a tax that has been abolished and it is merely a question of collecting arrears. As regards the drop of the yield in the liquor taxes, I personally would not attach as much importance to it as other speakers have done, because I agree there is a trend away from consumption of liquor. But it must in fairness be said that if one admits that there is a world-wide trend towards decrease in liquor consumption,  that is balanced by a world-wide trend towards increased tobacco consumption. Therefore, if the Minister is not to be humiliated over the reduced yield of the liquor taxes, neither must he boast of any increased yield in the tobacco taxes. Both one and the other may be representative only of a fashion. So I personally am aware of no taxation result that deserves to be accepted as a proof of the prosperity of the country.
The speech of the Minister for Finance contained references to the sugar situation and to the motor car situation which were decidedly ominous. He described the future of the sugar beet industry in this country as uncertain and insecure, unless they achieved a drastic lowering of costs which would enable them to contribute more abundantly to the Exchequer. And he later referred to the motor car industry in this country as being in the same position as the sugar industry in that regard. These remarks of the Minister for Finance received very little attention from the Minister for Industry and Commerce, who seemed very little concerned about the spirit or the letter of the Minister for Finance's speech as a whole. There you have another example of the complete recklessness of the statements that Fianna Fáil Deputies are in the habit of making beforehand, and the frequency with which their predictions and calculations are falsified by the events.
Mr. MacDermot: Let me add further that some light may be obtained on the question of the prosperity or otherwise of the country from the fact that there is such necessity for providing relief and work for the unemployed out of Government funds. To have to provide, not only relief, but an ever-increasing amount of relief for the poor throughout the country is far from being an indication of increased prosperity.
The Minister for Industry and Commerce  has expressed the view that it is outrageous for the Opposition to object to the total figures of the nation's expenditure. He says it is outrageous for them to object to the imposition of new taxes unless they are prepared to make definite suggestions in regard to economy. Of course, I understand his motive. Nothing would please him better than to drive the Opposition into making wild utterances about taking away much of the social services at present in existence. For example, such utterances would be a great service to the Government in the approaching by-elections, about which the Minister had so much to say. I should like to know where it has been found to be the duty, or the custom of an Opposition to make proposals for economy or savings while in opposition. In no part of the world do Oppositions do that sort of thing. On the very rare occasions that it has been done, it did not turn out so well. If we had nothing else to deter us from making such suggestions, it would be sufficient to have the example of our predecessors when they were in opposition. In my perusal of the speeches of the Minister for Industry and Commerce before he became Minister, I found he was very glib about the possibility of immense reductions in the cost of the Civil Service, in the cost of the Army and in the cost of the police. It is true that, as a general election approached, all the statements of those who are now Ministers with regard to economies became less and less specific. While the economies were still insisted on as possible, they were to be accomplished by some vague procedure, described as “reorganisation,” which was not to take a penny piece out of the pockets of anybody except a few highly-paid officials of non-national sympathies and non-national records. Once the Government came into office, the complete futility and insincerity of all their statements about economy were amply proven, and I should be very sorry that we should tread the same paths that they trod.
We are, however, perfectly entitled  to say this, and we do say it—that we believe a very large proportion of the misery and destitution existing in this country is caused by the general policy of the Government and that we do sincerely and honestly believe that a great deal of the expenditure in relief of that misery and destitution would be avoided if the general policy of the Government were reversed. More than that with regard to economy, there is no obligation on us to say. We are, however, entitled to note, and do note, that not only have the Government not reduced the cost of the Army and the police, but they have very considerably increased it. We are entitled to question, and do question, whether that increase was necessary or was desirable. The other day the Minister for Posts and Telegraphs, under pressure from his constituents, was induced to foreshadow economies in the Government services at some date when the remnants of the British régime—the highly paid officials protected by the Treaty—should have been got rid of. Even for that expression of view, which he probably hoped would not be reported in the newspapers but which was, he received an appalling drubbing in this House from Deputy Norton. He swallowed the leek quite meekly without venturing to utter a word in reply. With the best will in the world, I can find nothing in the record of the present Ministers while they were in opposition, or in the relation between what they said when in opposition and what they now say, to encourage us to imitate them.
Now, having dealt with the general economic condition of the country, I turn to the question whether this Budget is fiscally sound. The first point to which I ask the House to direct its attention is that of borrowing. The last speaker, like several others, objected to borrowing for bounties, but expressed his approval of borrowing for the other items for which the Government do borrow. I do not agree with him. I entirely disapprove of borrowing for bounties, but there are other borrowings of which I also disapprove. The Minister for Industry and Commerce himself used to take a very austere view of borrowing when  he was in Opposition. He was not at all content that the Government of the day should borrow even for nonrecurring items unless they made quite sure that there were not to be other non-recurring items of similar size in future Budgets. I think that that principle has rather been lost sight of now. The principle I should like to see enforced in regard to borrowing is that there should be borrowing only for objects that would be, in fact, revenue-producing. I think that borrowing for housing purposes is certainly justified if the houses are going to be let at economic rents. What about property losses compensation? Why should we saddle posterity with responsibility for compensation for property losses?
Mr. MacDermot: I do not care what was done by previous Governments. I remain of the same opinion, that it is unsound to pay the bulk or, as has been done, the whole of property losses compensation by borrowing. It seems to me that we are putting a great deal on the shoulders of posterity. I think it was a member of the Irish House of Commons, before the Union, who once exclaimed: “What has posterity done for us that we should consider posterity?” I am not prepared to take quite so selfish a view as that. I think we are asking posterity to shoulder a great deal as it is. It is very doubtful if posterity will be thankful to us for all we have done in this country for the last 20 years.
Mr. MacDermot: We are tending to pile more and more burdens upon their shoulders and to take away the assets that should be theirs. Take the case of the annuities that have been funded. I do not see why these annuities should not be left to posterity as an asset, or why we should anticipate them and borrow on their security.
Mr. MacDermot: I am speaking of the security on which the borrowings are being made. Let us turn now to the industrial alcohol plant. Is it sound to borrow for that? The answer to that question depends on your view as to whether it is a sound business or not. If it is unsound, it should not be borrowed for. If it is a highly speculative business, it ought not to be borrowed for. We ought to take a conservative view and pay a considerable amount, if not all, of that out of revenue. To borrowing for the purchase of land for afforestation I have no objection. It is proposed to borrow half the cost of the halls for the Volunteer Force. Is it sound finance to borrow for that purpose? The excuse of the Government is that if they ever wanted to sell the halls they would get half the original cost of them. Is that sufficient justification? Will they ever want to sell the halls? Under what circumstances will they want to sell the halls? They will not want to sell the halls. Halls are being built at present, and other halls will be built in future years. It is no more justifiable to borrow for this purpose than it would be to borrow for any other item of expenditure. It seems to me that that expenditure should be met out of revenue.
Mr. MacDermot: If they are depending on that, of course borrowing is all right. We come now to repayment of the Dáil External Loan. Is it right to borrow for that? I cannot see that it is. It is another case of shoving our responsibilities on to posterity. That is not a revenue producing item in any shape or form. We should make a beginning, at least, at paying that off out of revenue. In support of his proposal that we should borrow to meet the whole of it, the Minister for Finance said that we were turning an external loan into an internal loan. It is a bad loan, an unhealthy loan, a loan without any economic basis.
Mr. MacDermot: I do not care twopence what Cumann na nGaedheal did. I am talking of principles which seem to me to be sound. Frankly, I have not examined to what extent these principles were carried out by former Governments. I think we should be entitled to consider any question that affects the interests of this country, with fresh minds, as it crops up, without having to adhere blindly to precedent.
Mr. MacDermot: I am not suggesting that there never should be such a thing as a War Loan. There has to be such a thing as a War Loan. In this particular case it was not really due from us. It was, as we all know, a loan repayable in the event of certain things coming to pass, but these things have not come to pass.
Mr. MacDermot: At any rate, I frankly admit that the case on that is not near as strong as it is on some of the other items, but even on that I personally take a conservative point of view, and would like to see a considerable portion of it met out of revenue.
Mr. MacDermot: Turning to the question of export bounties and subsidies,  the excuse given for borrowing for this purpose is that the conditions are transitory and abnormal. Are they transitory and abnormal? What evidence is there of it? What leads the Government to think that they are transitory and abnormal? Is there anything to lead them to suppose that the present British Government is going to alter its point of view in the matter of our dispute with them? Are they banking on the present British Government being replaced by a Labour Government in the next general election, and if they are replaced by a Labour Government in the next general election, are the hopes of this Government likely to be fulfilled? My own notion on the matter is that if a Labour Government came into power in Great Britain our Ministry would be extremely embarrassed, because, I think, it is very likely that a Labour Government would offer them international arbitration on the whole financial dispute, and I think that is the very last thing they would like to be offered.
Mr. MacDermot: I think it is in the highest degree imprudent of them, if that is their expectation, to assume that they will win the arbitration and act as if there was to be no question of having to pay, as a result of arbitration, a sum equivalent to the amount of these export bounties and subsidies.
Mr. MacDermot: I suggest that so far as we can see these export bounties and subsidies are not transitory and are not abnormal. Therefore they ought to be met out of revenue. I suggest, moreover, that the land annuity arrears which are being relied upon to replenish some day or other the Guarantee Fund are a very doubtful asset, bearing in mind the present condition of the country and the prospect of a further deterioration in that condition. For all these reasons, I repeat that the export bounties and subsidies ought to be met out of revenue. The Minister for Industry  and Commerce made a great point of this: that only £1,500,000 had so far been provided by borrowing for export bounties and subsidies. That relates to last year, but there is to be another £1,350,000 found for the same purpose this year. How long it is intended to continue the practice of unsound borrowing in respect of export bounties and subsidies I do not know, but I think it ought to be recognised that it is unsound.
Now let me turn to another matter in connection with the soundness of the Budget: that is, the deduction of nearly £1,000,000 for overestimation in the case of Supply Services. It has been pointed out by several people that that is really a very odd item indeed. I am quite aware that an item similar to that—I do not say the same figure—used to appear in the Budgets of the last Government, but that does not reconcile me to it, and it did not reconcile Ministers to it when they were in opposition. I found a passage in a speech made by the Minister for Industry and Commerce on a Budget that was introduced in a year before his Party came into office, in which he described the custom of having such an item at all as thoroughly unsound and unhealthy. I agree with him. I think it is unsound and unhealthy, and that being so I am amazed—or I would be amazed if I had not so many examples of similar conduct on the part of Ministers in relation to other matters—that his views on the subject have not been reflected in the Budget of his Party, now that they are in office.
Let us turn to the taxes and to the question of justice and equity. The Minister for Industry and Commerce gave us an eloquent period about the redistribution of the wealth of the country. He told us that this Budget was not merely in accordance with Fianna Fáil policy, but that it was an instrument of Fianna Fáil policy. All I can say is, that if this is the redistribution at which Fianna Fáil policy has been aiming it is a very rum sort of redistribution. Let me look at it from the point of view of Ballinameen. Is  this a Budget for subsidising Ballinameen at the expense, shall we say, of Ailesbury Road, or is it a Budget for subsidising Ailesbury Road at the expense of Ballinameen? It looks to me much more like the latter, and if that is the kind of redistribution of wealth at which the Fianna Fáil Party are aiming, then I think the country is entitled to be more clearly informed about it than it has been up to the present.
I would like the Minister for Finance, when he is concluding, to tell us frankly why, faced with the necessities with which he says he is faced, he has not increased the standard rate of income tax? I think we are entitled to be told clearly about that.
Mr. MacDermot: It may be that he thinks that the yield would be less, or no better, if he did increase it, but if so I would like to have him say so—I would like to have that put on the records. Or it may be that he is thinking about the conversion of the National Loan and that this is what one might call a rich man's budget or a banker's budget for the purpose of getting investors into good humour for accepting the conversion, and that he intends, having successfully reconciled them to a reduction in their income, to fleece them good and proper in the Budget of 1936. It would be very interesting, if that is a fact, to have it clearly stated.
Before the present Ministers came into office they were perfectly clear that there was too much indirect taxation in this country. It was a favourite theme of the Minister for Industry and Commerce: that nothing should be done to add to indirect taxation, and yet this Budget piles on new indirect taxation. If the Minister had gone specially out of his way to choose the items that would hit the poor hardest he could not have chosen otherwise: bread, tea, sugar and tobacco. The social justice of this Budget is certainly not apparent to me unless it be that the Minister has really arrived at the end of his tether in the matter of  direct taxation. If he has, as I have said before, it would be very well indeed for us all that that should be plainly stated. If, on the contrary, the country is flowing with milk and honey, as is alleged by the Minister for Industry and Commerce—if we are in the middle of a boom—I cannot imagine on what grounds it is possible to defend making these additions to the annual budget of the small farmer in Ballinameen or the like of Ballinameen.
I should like to hear from some Deputy who is familiar with the budgets of the small farmer what are the amounts of tea, sugar, bread and tobacco that the small farmer has to buy in the course of the year, and what is the amount that will be added to the small farmer's expenditure by these taxes. If we could get authentic figures on that, I think it would be a shock to the House. Not alone do these new taxes bear with undue severity on the poor, but the new taxes and the new economies, taken together, bear with undue severity on the agricultural areas as compared with urban areas— on the areas that are most depressed at the present moment. Is it not the agricultural areas that will principally suffer, for example, from the tightening up of the regulations with regard to old age pensions? I imagine, too, that it is the agricultural districts that will principally suffer from the decrease in the amount to be given for unemployment assistance; and it is certainly the agricultural areas, rather than the urban areas, which will be hit most hard by the indirect taxes on tea, tobacco, sugar, and bread.
We are told by Ministers that, at any rate, there is one thing we cannot complain of, and that is the total volume of taxation. The Minister for Industry and Commerce has discovered now, what he never knew before he was in office, that it does not matter how big taxation is so long as the spending is good spending; that the total figure of taxation really does not matter; that it just redistributes wealth and keeps money circulating. Now, I do not accept that point of view. That is the  point of view that brought the last Labour Government in England to destruction.
Mr. MacDermot: The weakness of that point of view, is, in the first place, that capital is, to a large extent, mobile and can be frightened away by heavy taxation; and, secondly, that there is a proved and direct connection between high taxation and unemployment. There is no doubt of it. High taxation produces unemployment. There is no question of it. It has produced it in every country.
Mr. MacDermot: Sometimes it is the one, and sometimes it is the other. The two phenomena are closely connected. If a man's spirit is broken by heavy taxation, he has less initiative and less courage to employ money in industry and commerce and he has less of that unselfish desire to help one's brethren, which causes men to give employment that is necessary neither for their own comfort nor their own well-being. There is a very large amount of employment of that kind which is given primarily out of good nature and out of the desire to be helpful to one's fellow-citizens, and there is nothing so destructive of that kind of employment as high taxation. Therefore, I am quite satisfied that high taxation is an evil; but even if high taxation in itself were not evil, I would still maintain that in this present Budget the sort of new taxation which we are being asked to agree to is necessarily bad taxation. I object to the provisions of the Budget, not alone because I am appalled at the quantity of the expenditure that we are asked to meet, the quantity of revenue that is to be raised from our people, but because I am appalled also at the quality of the taxation that is being imposed.
It is a favourite contention of the present Ministry that Ireland was fleeced to the tune of £300,000,000 or thereabouts by the British Government  during the period between the Union and the setting up of the Free State.
Mr. MacDermot: It is not based on the theory that more was got out of Ireland than was spent in Ireland. It was not on that basis that the Childers Commission came to the conclusions it came to. The Childers Commission came to its conclusions, whether they are right or wrong, on the basis that a nation as poor as Ireland is suffers more from taxation than a richer nation; that there ought to be a different scale of taxation altogether. The Commission depended for its conclusions on the principle that taxation was, in itself, a great evil, no matter how the money arising from that taxation was spent. If we are now to adopt the principle that taxation is not an evil at all, so long as the money is well spent, the whole of the case against Great Britain, with regard to our financial history since the Union, disappears, and I think it is just as well that that fact should be borne in mind. If any Deputy doubts what I have said about the findings of the Childers Commission, he has only to read the material that exists about these proceedings and the various references made to the Commission by historians.
I hope, Sir, that I have gone some way towards establishing that the general financial and economic condition of the country is bad and tends, so far as we can see, to get worse and not better: that this Budget is, in many respects, unsound: that this Budget exacts a volume of taxation from this country, that, according to all opinions held hitherto—and perhaps sincerely held even now by Deputies opposite, although they dare not express them—is out of proportion to our resources: and, furthermore, that the kind of new taxes which the Government is imposing are especially calculated to press upon the poorest classes and the classes who are in the  worst situation as a result of the dispute of our Government with Great Britain. The Minister for Finance sums it all up by saying that we are shouldering the major responsibilities of freedom. I think that if these are the responsibilities and fruits of freedom, freedom is something that will tend to become discredited, and, as a lover of freedom, I should be the last man to wish to see that happen.
“From our experience for two years past as people living on the land, we find it impossible to carry on under present conditions. We consider there must be a change in the internal economic policy in the Twenty-Six Counties, so that if it is a war it must be a war for all, each having to bear a proportionate share. Peace and content cannot be in this country while one section is working hard and cannot work out a living, and another is getting 400 per cent. over pre-War rates of pay. We hope the Government will consider any reasonable proposal put before them, and not drive the people into the other organisations, which might not be for the good of the country.”
Mr. MacDermot: No, Sir. It has not. It has been repudiated by one national teacher, one of the class so keen on the economic war that they made the fiercest fight of all classes against the Minister's temporary economies. They were quite willing that the farmers should pay but not that they should contribute. What was the answer of the Minister to Ballinameen? “No doubt, in time, there would have to be more balance in the economic war than there had been.” Does this Budget represent the beginning? Is this Budget going to produce more balance in the economic war than hitherto? This Budget has increased the cost of bread, tea, sugar and tobacco on the poor man. If that is the sort of thing that is to be associated with freedom, I am indeed afraid that freedom will be discredited and that every spark of idealism will disappear from this country. I for one would be extremely sorry to see any such thing happening. The real responsibilities of freedom are to tell the truth to your own people, to throw off delusions and to help them to throw off delusions, to be reasonable and honourable in your dealings with foreign countries, to administer justice impartially, to ensue peace in deed and not only in words, and to acquire and to try to help others to acquire, an adult political mentality.
There is a famous parable in Plato's Republic about a cave in which prisoners are so chained that they can only look in one direction. From childhood they have been compelled to look only at a blank wall and at the shadows on the wall. Behind them there is light, and people and objects keep passing between them and the light. They never see these people and objects; they only see the shadows on the wall. All their ideas of reality are derived from these shadows. When they are freed and brought towards the light they refuse to believe that real things are real, and they refuse to regard the people leading them out as friends. They regard them as enemies whom they wish to stone or to kill. They regard them, in our terminology, as traitors and Imperialists.
The real responsibilities of freedom, if we have attained freedom, and if Ministers admit that we have, consist, not in taking the line of electoral advantage, not in sharing the delusions, or pretending to share the delusions, of the prisoners from the cave, but in renouncing these electoral advantages and playing the part that  freedom and education really impose upon you. Teach the people to set their feet in the pathway of reality. When the Government do that they will have full co-operation from the Opposition.
If in the by-elections, or any other elections that are before us, the Government, who are such expert electioneerers—and I make no concealment of the fact that electioneering is their strong suit—if they choose to maintain and to propagate mischievous delusions they are welcome to any benefit their Party may derive. We do not propose to imitate them. We welcome the opportunity which the Minister for Industry and Commerce said that the by-elections will afford us to set our ideals once again before the electors. We welcome that opportunity with considerable confidence, confidence enhanced by the impositions in this Budget. Whether the electors act with common sense or patriotism, or whether they do not, I want to assure the Minister and his colleagues that no electioneering considerations will shake us in the very least in the propagation of sound principles and in the conduct of public affairs on lines that seem to us patriotic, and calculated to lead to the peace and prosperity of the country.
Dr. Ryan: I am afraid Deputy MacDermot must have been taking his revenge on the House for having rejected his motion to confine speeches to one half-hour, because I think what the Deputy said might easily have been said in half an hour or, in fact, less. He set out at the beginning to make a very clever political speech. He said that the taxes were fundamentally unpopular and inequitable. The fundamental thing about them was that they were unpopular, and he expressed the opinion that perhaps they were inequitable. He hoped that continued criticism of the Budget would enlighten the people on that point; that they were unpopular taxes. That was the point Deputy MacDermot and every speaker on the Opposition Benches tried to emphasise when dealing with the Budget.
Dr. Ryan: Deputy MacDermot and other Deputies when criticising the Budget tried to play on the unpopularity of the taxes, but did not attempt to show that they were in any way inequitable. He said that they were unpopular. That is the only thing the Deputy could say in his speech of one and a quarter hours' duration. He ended up with an appeal to the electors of Galway and County Dublin. He said, of course, that they could not improve the position, and talked of economies in view of the pending by-elections. That finished that point. Instead of making points or suggestions that would be for the good of the country, the Deputy suppressed them, as the by-elections were of much more importance to the Fine Gael Party. I am sure Deputy MacDermot believes he could make suggestions that would be for the good of the country. But why should he consider the good of the country when by-elections are pending and when there is a chance that Fine Gael might do well out of them.
Mr. MacDermot: If the Minister will allow me to interrupt him, I may say that what he says is not at all a fact. I suggested that the increases made by the Government in the Army and in the police were unnecessary, but I said, in the main, that our point of view was that the general economic policy of the Government made a large part of the expenditure in the Budget necessary, which would not be necessary if that economic policy were abandoned. I did not say that I had any suggestions to make that I suppressed, because of the by-elections, nor did I imply that.
Dr. Ryan: We will wait until we see the Official Report. In the speeches of the Opposition from the commencement there was a demand for a decrease in taxation and a general demand for increased expenditure all the year round.
Dr. Ryan: Yes, but we suggested it intelligently and pointed out how it could be done. Here we have an Opposition that has shown neither intelligence nor common sense in suggestions about cutting down taxation and increasing expenditure, on the gage thrown out by Deputy MacDermot and others, not to make any suggestions until the by-elections are over. That is the sort of game they are carrying on. When we were in Opposition we used to make positive statements——
Dr. Ryan: I remember on one occasion making a positive statement with regard to the beer taxes, that is that they were not to be lessened. The Opposition over there may be sitting in that position for the next 40 years if they are 40 years in the House, but they will not be in office, and I am quite sure in all those years they will not have the courage to make such a positive statement.
Dr. Ryan: The Opposition, I am sure, will admit that the greater part of the increase in expenditure under this Government has been in the way of social services. If one were to go through the list and take out the items that come under the heading of social services, such things as unemployment assistance, relief schemes, housing, old  age pensions and so on, one would find that they would come to £9,000,000 sterling. Under these particular headings the expenditure has been doubled since the Cumann na nGaedheal Government were in power. We have in these items of social services an increase in expenditure of between £4,000,000 and £5,000,000. No member on the Opposition Benches has attempted to suggest that a single item under these headings should be cut out. I know they will not, though some of them may feel that we should not give so much in old age pensions or that we should not be bringing in a Bill to give pensions to widows and orphans. Naturally Cumann na nGaedheal will not agree to increase old age pensions seeing that they resigned office in 1931 rather than do that. Now when they are in Opposition they will not do it.
We must be reconciled to the fact that the Opposition will still play politics in discussing the Budget as well as in discussing anything else. Deputy MacDermot talked about high taxation, the quantity of taxation and the aggregate amount of taxation paid, and he said it is too high. But he does not suggest that we should cut down any of our expenditure. He did suggest, perhaps, a small saving in the Gárda Síochána and in the Army. Perhaps a saving could be made in the Gárda if Deputy MacDermot had more influence amongst his own followers; but I will leave that aside for the moment. If we take up the Fine Gael election address we find that they are promising to give old age pensions at 65. That is another £3,500,000.
Dr. Ryan: They also suggest that  there should be derating. That item, with the old age pensions at 65, is going to add £5,000,000 to present expenditure. If Deputy MacDermot is Minister for Finance, as we are told is to be the case, there is going to be no borrowing for property losses compensation, for external loans, for volunteer halls, and for none of these things mentioned, so that another few millions is going to be added to the taxation. Deputy MacDermot, in that case, would have to meet a bill of about £7,000,000 more taxation than we are meeting at present. The Deputy will not tax sugar or tea or tobacco or corporation profits. He will tax nothing, but notwithstanding that he is going to get £7,000,000 more. Did anybody ever hear such an idiotic speech? I did not expect to hear such a speech from Deputy MacDermot.
Dr. Ryan: I did not catch what the Deputy said. I would like to get a constructive suggestion from Deputy MacDermot, because naturally we are all interested in the Budget. Every Minister has to weigh up and take responsibility for the Budget, and I would be glad to have a constructive suggestion from the Deputy. However, he made it very clear that pending the by-elections in Galway and Dublin he will not make any constructive suggestions. The suggestions he made were destructive as far as the Budget is concerned but, perhaps, they are constructive suggestions so far as Fine Gael is concerned. That is all I dare say Deputy MacDermot is concerned with.
There were two Bills before the House lately. Deputy Belton took a keen interest in these Bills. The Opposition opposed those Bills because I was trying to raise money by levies. They said I should not raise money on butter and bacon by levies, and that I should take these things out of taxation. A division was taken on the question, and every member of the Fine Gael Party voted against me. The result of that, if carried to a conclusion, would be that Deputy MacDermot if he were Minister for Finance, would not only have to raise  £7,000,000 but, in addition to that, £800,000 in lieu of the levy on butter, and £500,000 for the levy on bacon——
Dr. Ryan: Yes, but you must raise it in another way. It must not be raised off the butter consumers or the bacon consumers, or by a tax on wheat or tobacco, or tea or sugar, or corporation profits tax. In that way Deputy MacDermot, when Minister for Finance is going to have the job of getting £8,500,000 extra. The duty on tobacco is £3,000,000. The new taxation that Deputy MacDermot would have to get would reach £15,000,000, but he tells us he will not touch any of these things I have named. Then where is he to get the money?
Dr. Ryan: One cannot have any respect for a Party who will vote for popularity and will not care about any other issue. Popularity is the only issue that has any weight with the Fine Gael Party. We bring in a Butter Bill and a Bacon Bill, and if Fine Gael see that we are going to give anything to the creameries they are all in with us. But when we say we are to raise this money in a particular way they are all against us. It is popularity with Fine Gael every time. Deputy MacDermot, in a most deliberate speech here to-day could not have given a better example than he gave as to how Fine Gael is affected by the idea of popularity. What concerns them is the question whether it is a popular thing; make no mistake about it, all that concerns them is whether the thing is popular. They will tread on no one's corns until they get into power, “and then you can do what you like.”
I remember saying shortly after we came into power, when we had a very slender majority, that people need not be afraid that we would be beaten. Our big trouble then was putting on tariffs, and it is only on these questions they would vote against us. But in the case of every tariff there would be  three or four Cumann na nGaedheal members who would stay away, because they were interested in those tariffs themselves. In other words, these people are so many opportunists, and none of them would vote against the interests of their own constituents. They are sticking to that viewpoint and they are just as much opportunists now as when Deputy MacDermot joined them. I do not think Deputy MacDermot's presence is going to improve things very much, judging by the speech to which we have just listened. In preparing this Budget as well as the other Budgets we have brought in, we considered all these social services, and we considered all the other items of expenditure to see where, if possible, any savings could be effected. Having made out the bill that was necessary to meet expenditure, we then had to consider raising the money to pay what was necessary for the year. I think any Government that can say to the people that they have doubled the amount spent on social services in their three years in office, as we have done, have something to be proud of. We put up the expenditure on these services by £4,500,000. If we had to go to the country we could say we had to raise this money in order to pay for these social services. We should be proud of this Budget, and I say we are proud of it. That is why the Minister for Industry and Commerce said the other day, that we were prepared to fight the by-elections in Dublin and Galway. I think the people of Dublin and Galway, when they see that we have the courage to bring in a Budget like this, will appreciate it no matter what the popularity seekers on the Opposition side may say about it.
The people are going to see through it. They are not a bit impressed with that sort of talk, such as: “Do not tax tea, do not tax sugar, do not tax tobacco, do not take anything off the profits of corporations, but, of course, you must raise this £5,000,000 or £10,000,000 or £15,000,000 that we are going to give you when we come into power.” Deputy MacDermot may think that there are foolish people in County  Galway and in County Dublin, but they have sense enough to see through that sort of thing. If they do ever pluck up courage to move these writs, as I suppose they will, because they will be more or less shamed into it, when the by-elections are over the Deputy will see that I am right, perhaps then he will have the sense to change his tactics, because the only thing that will make him change his tactics is a reverse.
Deputy MacDermot went on placidly talking about the destructive policy of the present Government with regard to agriculture, but he did not seek to prove that there was anything in that assertion. He evidently took it for granted. I will ask him, as he has evidently a taste for research with regard to figures, to go to the Library or some other place and look up the prices for farm products for the last twelve months and compare them with the prices in Great Britain and Northern Ireland and see whether the agriculturist here can complain that he was very much worse off as a result of the tariff policy of Great Britain against this country. He will find he is not worse off as a result of the economic war, as it is called. Prices are bad in agriculture. That is admitted the world over. But the Opposition, in their political way, try to impress on the people of this country that if the economic war was over everything would be all right. It is the only argument they have left as far as their policy goes. For some commodities we are getting a much better price than if we had an open door to Great Britain without any tariffs, or subsidies or bounties from this side. Every Deputy will admit, for instance, that we are getting a better price for butter and milk products.
Dr. Ryan: What is wrong with paying it? The Government are criticised  for not doing enough for agriculture. I will tell you what we are doing for it. If agriculture is in a bad way, if we are getting poor prices, it is due to the low level of world prices and not to the economic war.
Dr. Ryan: I do not know anything about Columcille's prophecies. When we brought in a stabilisation scheme for butter the Opposition Front Bench voted against us and spent three years afterwards trying to deny that. Leaving that aside, however, as a result of that we had a price ranging from 4d. to 4½d. for milk at the creameries, and in Northern Ireland it was about 3d. until they brought in a stabilisation scheme of their own last year. For two years they were a long way behind us.
Dr. Ryan: The Deputy is perhaps better informed than I am. However, I will come to the calf skins later. No Deputy will deny, at any rate, that if there was an open door for milk products into Great Britain with no tariffs there, and no subsidies or  bounties or anything else here, we would be getting less for milk products now than we are getting under present circumstances. Two or three days ago the price quoted for New Zealand and Irish butter was about 76/-. We are providing under our scheme here for a price of 100/- to the creameries, as against 76/- and 76/-, less 2/- or 3/- for landing charges the very best they could get if there was not a stabilisation scheme.
Dr. Ryan: I cannot follow the Deputy on the currency question. Our 100/- might be worth 200/- if Deputy Belton had his way. I am talking about 100/-. They would be getting only 76/- if there was no tariff in Great Britain and no subsidy or bounty here. We are getting a better price for fruit and vegetables and a much better price for all sorts of grain. The price of wheat goes up to 26/-, namely, 14/- more than if there was no Government policy of protection. Barley is a much better price; oats are a much better price—there is smuggling of oats across the Border. As a result of our policy, three new beet factories were established and we are delivering beet to four factories instead of one. This protective policy has, in a number of cases, put agriculture in a better position than it would be under the free trade policy of Fine Gael, to which Deputy MacDermot evidently hopes to get back.
Dr. Ryan: That is a hard one. I will not mention tobacco at present, because it is only a small item; but we are getting more of tobacco than if there was no subsidy. I invite any Deputy to examine for the last year the prices of bacon, eggs and poultry, and he will find that we were getting as good a price for these three items as we would have got if there was no tariff, and no subsidy or bounty on them going out of this country. We were getting all round as good a price.
Dr. Ryan: Yes, in addition to giving these good prices. We are getting almost as good prices for sheep and horses. The only one item for which there was a much lower price than if there had been free trade was cattle; but it must be remembered that the quota, which would have come in any case, was more responsible for the reduction in the price of cattle than any tariffs or any economic war. Against that reduction in the price of cattle we gave the farmer the benefit of halving the land annuities, which brought the amount down by £2,000,000.
Dr. Ryan: The Deputy is just as dishonest in his statements as Deputy MacDermot. What does 61/- mean? It means 61/- before all the different deductions; there is a levy to the Government; there is a levy to the Board; there is a levy for freight, and it all comes down to about 58/6d.
Dr. Ryan: Perhaps he is as honest as the Deputy himself. Will Deputies opposite tell me why do farmers support this Government if all that is true? Why do they put us back into office? It must be either that they believe we are right, and you are wrong, or that if they believe you are right they still say to themselves: “As bad as they are, they are better than Cumann na nGaedheal.”
Dr. Ryan: In 1929 we had an election; in 1930 we had another election; in 1931 we had still another; in 1932 we had a general election. If one were to watch the curve of Fianna Fáil support, it went up every time since 1929, although the people had been listening at the cross-roads and everywhere else to Fine Gael and Cumann na nGaedheal propagandists telling them that we have ruined the farmers. They do not believe you, or at least, if they do, they say: “What we have is better than to get that crowd back again.”
Dr. Ryan: Deputy MacDermot is, I admit, a very good political technician. If he adopted a more honest line with the farmers, told them honestly what this Government has done for them or has not done for them, and what his Party's policy would be if they came into power, admitting that they would have to put on certain taxes and have to cut certain expenses, he would get on better. Of course I am only giving that as advice to our friend.
Dr. Ryan: Even that bait was not sufficient to keep him over there. Deputy Dillon follows me as a rule,  and I sometimes think that he has been chosen by the other side as the next Minister for Agriculture.
Dr. Ryan: That is true. Of course, he follows them all. I think Deputy Dillon, or whoever is going to state the agricultural policy for the other side, could state it in three words. Deputy Dillon will not do it in three words; I admit that. But it could be stated in three words—“the English market.” That is the only item of policy they have which is different from Fianna Fáil. It is true that Deputy MacDermot said he does not agree with protection. It is true we got a considerable amount of opposition to our protection policy.
Dr. Ryan: Deputy MacDermot said that while we had a policy of protection in the country there would be high taxation and lots of unemployment. I interpreted that as meaning that he disapproved of protection.
Dr. Ryan: Perhaps he does not disapprove of protection. I thought he disapproved of high taxation and unemployment, and that therefore he disapproved of protection, but the Deputy may have another way of looking at it. When we were putting on tariffs the Cumann na nGaedheal Party opposed us very strongly. In all their speeches in the beginning they spoke against protection, but when it came to the 1933 election they said they would not remove the tariffs we had put on; in fact, they would pursue the policy which the Fianna Fáil Government had been pursuing. They resigned rather than give another few hundred pounds to the old age pensioners. We gave that money, and when the 1933 election came along Cumann na nGaedheal put it as part of their policy that they would not take that money away from the old age pensioners. They also  very strongly opposed wheat growing when we were trying to push it through here. However, as they were going through the country, they saw some farmers sowing wheat, so they said to themselves: “There is no use in losing those few fellows' votes,” and they put it into their election speeches that they would adopt the wheat policy also.
Dr. Ryan: I should like very much if some authoritative person on the other side, whether it be Deputy Dillon or whoever the next Minister for Agriculture is going to be, would tell us some day what their agricultural policy is, and how it is to be different from the agricultural policy on this side except in that one respect—the British market. I remember asking here about two years ago—Deputy MacDermot was not a leader of the opposite Party at that time—suppose we were going over to negotiate in London, would they agree that we should pay the £5,000,000 again? They said they would not agree. I thought I might bid them up, so I asked if they would agree to pay £3,000,000, and they said “No”; they would agree to pay nothing. We were to go over and settle with the British Government, but give them nothing; the same Fine Gael policy of popularity with the country—“settle with John Bull but for goodness' sake do not give them £1,000,000 or even £500,000. It would not do for us were we to agree to that.”
Dr. Ryan: Anyway, we have got something from the Opposition, of which I am very glad. We have it from Deputy MacDermot that it would be worth a settlement of £25,000,000 down. It should not be borrowed, I take it?
Dr. Ryan: Not exactly. The Deputy should be more precise. Deputy MacDermot also, in speaking on this question, criticised the tax on wheat. Deputy O'Leary says we have got a trial of the wheat policy. We are getting a very good trial. We expect to have about 200,000 acres this year. There were 21,000 acres in 1931, and now we hope to reach an acreage of 200,000 this year.
Dr. Ryan: I take it that the Fine Gael Party, when that Bill is introduced, will suggest that we should not do it in the way we propose to do it and that it should come out of separate taxation. Perhaps then Deputy MacDermot may be able to suggest what we will get the taxation from. The consumer will have to pay at the rate of 23/6 a barrel for Irish-grown wheat. Year by year it is expected the amount of Irish wheat will be increasing and the imported wheat will be smaller in quantity. Even a bigger tax on wheat might have been justified, because year by year the importation of foreign wheat is decreasing and the position will tend to stabilise as the years go on. If we are going to pursue this policy the tax on wheat is not going to be felt by the consumer. When there was an economic committee sitting here in 1929-30, it was recommended that wheat should be grown by the Irish farmer to a larger degree than it had been grown. We were then dealing with foreign wheat that was costing about 31/- a barrel. Wheat went down in price up to a few months ago and this slight increase in taxation does not bring it back nearly to what it was.
 Deputy Dillon stated that it was uneconomic to grow wheat and he even declared that it was uneconomic to mill flour. He said we were paying 36/- as against 27/- in Liverpool. I do not accept the Deputy's figures; I merely quote him. He said the price for flour here was much higher than in Liverpool and, therefore, our policy here was uneconomic. If he is going to make out that it is uneconomic because it is dearer here, then he might also include bread. Bread was coming in here and it was sold more cheaply in certain parts of the Free State than it could be produced at. If we were to follow the strict economic principles of the Opposition, we would stop growing wheat, milling flour and making bread, and we would import it from Belfast or elsewhere. But, following out those economic principles, you would not stop there. We are getting 54/- or 55/- a live cwt. for pigs, and our bacon is costing 89/- or 90/-. You could get much cheaper bacon abroad, and there is no reason why, under the economic principles of the Opposition, we should continue to produce pigs and manufacture bacon when we could import bacon for 45/- or 50/-. The same thing would apply practically to everything—barley, oats, fruit, vegetables, and even meat. According to the economic principles of Deputies opposite, cattle at our present price are uneconomic because we could import Argentine meat at as low as 1½d. per lb. and very good meat, too. Following out the views of Deputies in the Opposition Benches, our cattle are too dear for the ordinary householder.
If the Opposition were allowed to have their way and to put their economic principles into operation, we would, apparently, have a grand country with 3,000,000 of a population and with no production, because we could buy everything so cheaply from abroad. We would have plenty of time to enjoy ourselves, and Deputy MacDermot could tax whatever he liked then. These economic principles set out by Deputy Dillon, and other members of the Opposition, might be very fine for a Budget debate or appear high-sounding rhetoric to their followers down the country, but when they are pushed to a  conclusion and applied to everyday commodities, they do not hold. Deputy Dillon does not mean them to hold. Deputies in the Opposition Party would not like to suggest to the people of the country that we should give up producing bacon and cattle.
Tea, sugar and tobacco were always taxed. As long as I remember they were taxed. In some years the tax would be taken off, and in other years it would be reimposed. If a Government has to raise taxation, the members of it must take many things into consideration. They must calculate the amount they require and must endeavour to distribute the burden fairly. They select certain commodities for a tax, such as tea, sugar or tobacco.
Dr. Ryan: The year before we came into office it was on the whole lot of them. The taxes were on already before we came in and we increased them. If Cumann na nGaedheal put 4d. on tea, and we put 8d., does the Deputy think that 4d. is just and 8d. unjust?
Dr. Ryan: The Deputy would encourage me very much if he made a constructive suggestion as to what tax would be relieved in lieu of an increase in the income tax. What I want to get from Deputy MacDermot is this: the Deputy, or perhaps some other Deputy following him, might be able to tell me why it is considered rather a criminal thing for this Government to put a tax on tea, sugar, tobacco, and even on wheat? Why is it considered to be unjust and unfair to the small farmer? When Cumann na nGaedheal put a tax on tea and sugar—and those articles were dearer at that time—did they not hit the small farmer at all? One would imagine from listening to the Opposition speakers that they would not ask the small farmer for anything.
Dr. Ryan: The tax on property is, I think, admitted by everybody—I do not think it was even criticised by Deputy MacDermot—to be a just tax. The only other taxes we have raised are protective and are justified by reason of their being protective.
What I would very much like to have, and what all of us over here, because I think I can speak for this Party, would like to have, is a considered and agreed criticism of the Budget, with constructive suggestions. We do not want one Opposition leader saying one thing and another leader saying another. We should like to have an agreed attempt to criticise the Budget and to tell us what changes they think should be made, if we should have taxed one thing more than another. Perhaps we should have increased income tax and taken the tax off tea. If that were an agreed suggestion from the Opposition, I think it would have considerable weight on this side of the House. We would be so surprised to get a constructive suggestion that we would  think there was a change of attitude and we should like to encourage that. I think it would be very good if they would make a constructive suggestion of that kind, but it is not so easy to get such a suggestion from them.
Apart from that, there is the general criticism of the Budget that we are raising too much taxation, and, from some speakers, the criticism that we are not spending enough in certain directions—for instance, we are not doing enough for the farmers. I wonder would there be any chance of getting a constructive suggestion as to where we should take off taxation, if we want to reduce it, and where we should increase expenditure, if we are to increase it. If they started to increase expenditure, we should like to know where the extra taxation is to be got.
Dr. Ryan: Deputy MacDermot talked in a general way about the amount of taxation we were raising, and said that the aggregate amount was too high. I should like to get from the Deputy— it will not, perhaps, commit him very far—what the aggregate amount should be. If it is £28,000,000 now, should it be £26,000,000, £24,000,000, £20,000,000 or £18,000,000? I wonder would the Deputy commit himself even that far and take the risk——
Dr. Ryan: ——in the eventuality of his ever having to put his figure into practice, of mentioning the amount it should be? The great difficulty we have is to get any sort of agreed criticism or agreed policy from the Opposition and, especially, to get  anything constructive. As I said in the beginning, when we were on the Opposition benches we were never afraid to do the unpopular thing or to make a suggestion even though people did not like it. In the first place, we were honest, and in the second place, we were good psychologists, and we knew that the people would respect us for it.
Dr. Ryan: Yes, I mentioned one here to-day. There was a proposal brought in here to reduce the tax on beer and spirits. That was a very popular thing, and we, as a Party, voted unanimously against it. As I said in the beginning, if the Opposition is over there for the next 40 years, I am quite sure that they would never do as courageous a thing as that.
Dr. Ryan: I am afraid there is no great hope of getting any constructive criticism from the Opposition on this Budget. I listened to three or four of the principal speakers on this Budget, and their speeches were intensely political. The others, of course, did not actually say that they had the Galway and Dublin by-elections in mind as Deputy MacDermot did. He was honest so far as that went.
Dr. Ryan: Deputy MacDermot went on three points. He talked about the financial position of the country, but he certainly did not convince anybody that the country was financially worse off than it was three or four years ago. I am not going to spoil the speech of the Minister for Finance, but I think he will produce figures of bank deposits which will show Deputy MacDermot to be wrong in some of the figures which he gave. It has not been shown that the country is in any way financially worse off than it was three or four years ago. Secondly, Deputy MacDermot spoke about a sound Budget. It has not been shown by the Deputy, or anybody else, that the Budget is not sound in respect of having a balanced estimate of expenditure and income for the coming year. Nobody can defend the principle that you must pay for every single thing, such as the external loan and property losses compensation, out of current revenue. The question put to Deputy MacDermot by Deputy Belton was, I think, very relevant, as to whether the British were supposed to pay all the war debts out of current revenue in one year. The external loan and the property losses compensation arose out of a war in this country.
Dr. Ryan: Surely we are not expected to pay those in one year. Deputy MacDermot did not prove that the Budget was not sound. Thirdly, he tried to prove that the taxes were not equitable. Anybody who examines his speech and studies the various things which he said should not be taxed—sugar, tea, tobacco, and so on —will see how ridiculous Deputy MacDermot would make his own position if he were sitting here as Minister for Finance, paying all the things which we are paying—£3,500,000 to old  age pensioners from the age of 65 upwards and £1,200,000 for derating—out of current revenue and paying out of central taxation, what we are raising by the butter and bacon levies. If he says he is going to do that on £13,000,000 or £15,000,000 and that he will not put a halfpenny on tea, sugar, tobacco, wheat, bread or corporation profits tax, I do not know where he is going to get it. I think it is a pity he cannot make another speech.
Mr. Davin: I think this Budget could be described by the average intelligent citizen who understands, and has been following, the activities of Government in this country as a banker's Budget, and I have no hesitation whatever in describing it as such. The framework of this Budget has been founded upon the idea of capturing the imagination of the investor; and I believe, as far as I can see from the trend of the speeches from the Government Benches, also for the purpose of endeavouring to secure the co-operation of the Opposition Party in this House in connection with the new conversion loan which is to be floated. There is much similarity between the speeches from the Front Opposition Bench and from the Government Benches; and that appears to a certain extent in the speech we have just listened to from the Minister for Agriculture.
When I was voting, with my colleagues, for the election of this Government, I was quite clear that we were doing it for the purpose of giving the country an opportunity of getting an alternative Government, which the people had indicated they were prepared for. The people in 1932 made it quite clear, and they made it more clear in the subsequent election, that they did not want the imposition of a Cumann na nGaedheal Government extending beyond ten years. They were prepared to pay for an alternative Government in the hope that they would fulfil the public pledges that they had given to the country. When I was voting for that Government, I was quite clear in my own mind that I was doing so, personally, because I had sympathy with the national and the international policy of the Fianna Fáil  Party. But I was clear in my own mind, and my colleagues and myself made it clear to the leader of the Fianna Fáil Party that we were not prepared to give a blank cheque for every item of policy that they were prepared to pursue. On the vote for the election of the Cabinet, on the nomination of President de Valera, in 1932, knowing, as I then knew, the economic policy of the Fianna Fáil Party, I never thought that I would find in this House a Republican Minister for Finance being congratulated in a public speech by Deputy Good. Deputy Good in his broadcast speech on Saturday night is reported as having said:—
“——who were in favour of sound finance would have to compliment him on having the courage to tell the people that if they wanted certain services they must pay for them. Also he had the courage to impose all-round taxation to emphasise the fact that these services must be paid for.”
Of course, anybody could understand from the past history of Deputy Good, and the mentality he represents in this House, and in the country, that he and those associated with him and those for whom he speaks were delighted because taxes were to be put on tea and sugar and other necessaries of life, and that income tax and increased profit tax and super-tax were not interfered with. I would like to hear more from the back benchers of the Fianna Fáil Party in the way of defence of these impositions and of the increased tax on tea, sugar and tobacco and coal and other commodities while income tax and super-tax were left as  they were last year. I would like to hear Deputy Corry or Deputy Donnelly tell the House and the country and their constituents particularly how they can justify the imposition of taxation on tea, sugar, butter and coal upon the people of Ireland and on many who have the miserable sum of 6/- a week in the shape of home assistance to live on. I mention Deputy Donnelly and Deputy Corry because they speak often in this House, and are regarded as No. 1 and No. 2 Government yes-men. They know perfectly well the position in rural Ireland to-day, of people in receipt of 6/- a week home assistance, and that such people exist upon bread and tea. They are not allowed, because their financial position would not allow them, to buy butter at its present price. Here we have Deputy Corry and Deputy Donnelly getting up and backing up the imposition of taxes on tea and sugar, knowing, at the same time, that it will deprive those people of the necessaries of life, while they are prepared to leave income tax and super-tax and corporation profits tax alone.
Mr. Davin: Free beef, as Deputy Donnelly must know, has recently been taken away from a large number of people eligible to receive unemployment assistance. To me all this is very bad policy and discloses a sad state of affairs. I shall endeavour to prove by quotations that the Government have taken steps in the last few months to force down the wages paid to persons employed on public works while at the same time increasing the cost of living to those people. I have a case here which I raised in this House. I was requested to draw attention to the fact that on a recent occasion workers engaged on a forestry scheme were paid, until now, the unknown minimum rate of 22/- per week. One person, when this was discovered, remarked that it must be simply a book-keeping blunder; that there must be something wrong in the office, and that someone who must be responsible for paying the proper rate, namely, 28/- a week, had blundered. I put a question to the Minister for Lands, and I asked  whether this rate of 22/- had been officially sanctioned, and the reply that I received from Deputy O'Grady, acting for the Minister, is as follows:
“The Deputy is correct in stating that the rate of wages paid at Kinnitty Forest, Offaly, is 22/-, and that the rate of wages paid in Mountrath Forest, Leix, a few miles distant, is 28/-. That is, however, explained by the fact that the rate for Mountrath was fixed some years ago when the rate of wages for agricultural labourers, to which the matter is related, was higher than at present.”
Is not that an extraordinary statement, especially in view of what we have listened to from the Minister for Agriculture? The Minister, in his speech, enumerated items of agricultural production where, he says, and I believe in some cases he is right, that farmers to-day are receiving a higher price than when the Cumann na nGaedheal Government was in office. There is something wrong with the action of the Minister for Lands in forcing down the recognised rate of 28/- paid in every other county, to the previously unknown minimum of 22/- a week. That is done at a time when this Government comes to the country and asks us to back a Budget that proposes new taxation upon tea and sugar and other necessaries of life. I ask Deputy Donnelly to explain that, if the Minister for Finance will not come in and explain it, and especially to explain it in the line of the speech of the Minister for Agriculture. We had other cases brought to the notice of the House recently, when the rate of wages paid to-day by the Land Commission to workers engaged in the building of houses in Kilkenny by direct labour has been reduced from 28/- a week to 24/- a week. Some explanation has been given in support of the action of the Land Commission in that matter. I listened-in to the speech—the rather amusing speech—of the Minister for Industry and Commerce on the wireless last night. Everybody who listened to that speech must have been highly amused at the audacity of the Minister when he said:—
If the Minister knew what he was talking about last night, or if he had sought information as to what was going on in the country, he would have found that the price of flour has gone up all over the country and that the price of bread has, in some cases, gone up by a 1/2d. per 4lb. loaf. The price of tea and sugar has gone up as a result of the Government's proposals. The price of farmers' butter in the area where these low wages are to be imposed has gone up and will go up by 3d. or 3½d. per lb. under the legislation which has been introduced. “The cost of living is still going down.” That statement could only be made by the greatest political bluffer this country has ever heard on the wireless or in this House. That is what I call the Minister for Industry and Commerce for making a statement which he had no authority for making in the light of present conditions.
Mr. Davin: The Budget proposes to impose new taxation on tea, sugar, flour—and, as a consequence, bread— jams, and tobacco, while, as a result of a previous decision by the Government, the price of coal has been increased by 5/- per ton. A great many people say that the poor are not affected in any part of the country by this tax of 5/- per ton on coal. I imagine that Deputy Flinn is going to speak in this debate, as he has been taking notes of the speeches. I should like to ask Deputy Flinn whether he is satisfied that in the slum areas of Dublin—Cork Street, the Coombe and Gloucester Street—the people have sufficient accommodation to store turf even if they were willing and anxious  to burn it. Why should these poor people be forced to buy coal upon which a tax of 5/- per ton has been imposed by the Government? That 5/- per ton has to be paid by the consumers, including poor consumers who are unable to burn turf for the reasons I have stated. I am sure that other Deputies have had the experience I have had when visiting certain parts of the slums of Dublin. The people in the slums live in one-room tenements where they have no room to keep more than a few stones of coal. They could not possibly find the accommodation which would store the equivalent quantity of turf, from the point of view of calorific content.
The Minister for Industry and Commerce, in his broadcast speech last night, criticised Deputy McGilligan, Mr. Duffy, who spoke for the Labour Party, and, to a lesser extent, Deputy Good, for having failed to indicate the sources from which they would draw the taxation required. So far as I am concerned, I would certainly advocate the reduction, if not the total abolition, of the bounties presently provided for live stock exported from this country. I would advocate the reduction of the bounties because I am satisfied—I am sure that anybody who has made a study of the way in which the bounties are allocated and administered is equally satisfied—that these large sums, amounting to over £3,000,000 last year, are not finding their way to the people for whom they were intended by this House. Does anybody suggest that the bounties provided by the taxpayers for live stock exported from here are finding their way in full to the live stock producers in the rural areas? Most of the money, so far as I can see, is going into the pockets of the cattle dealers. Very often it goes into the pockets of cattle dealers who come over here from England and take our cheap cattle away with them from Thursday's cattle market. I should be prepared to advocate here and to defend in my constituency a reduction of the bounties on live stock before I would face the imposition of taxes on tea, sugar, or any of the other necessaries of life. I should be prepared to devote the  amount now devoted to bounties to derating, because, if the £3,000,000 now raised at the expense of the taxpayers was set aside to help the farmer by way of derating, every penny would go into the pockets of the farmers without any additional administrative expenses. I have a strong feeling, and have so informed my colleagues, in favour of a motion which is down on the Order Paper in the name of Deputy Curran in connection with that matter. I feel that the taxpayers are being mulcted for bounties which are intended to go to the farmers but which are not going in that way because of the method by which they are administered and because of the activities of the middlemen. I am also prepared to advocate here and defend elsewhere the imposition of taxes on other classes of people rather than face the proposition of imposing taxation on the necessaries of life.
What about the ground landlords who are increasing their revenue by leaps and bounds as a result of the operation of the Housing Acts? What about the hundreds of speculative builders around Dublin, Waterford, Cork and Limerick and other provincial centres, who, as the Minister for Finance knows better than anybody else, have bought out land at fairly low rates and built houses with grants provided by the taxpayers and the people of the country, who have got the benefit of the Small Dwellings Acquisition Act and who come along now and, without any interference by this Government, create ground rents of from £7 to £15 per house? In the constituency represented by the Minister for Industry and Commerce, 200 houses have been built at the back of Tyrconnell Road in Inchicore by a public utility society— it does not matter to me by whom they were built—which got grants under the Housing Acts and in respect of these houses ground rents of not less than £7 per house have been created. What about searching the pockets of those individuals who are getting rich quickly at the expense of the taxpayers and who have to make no contributions of any kind in this country? Later, I presume there will be a demand, which will be accepted, for a Town Tenants  Purchase Bill. Some of the gentlemen now gambling in these ground rents will then be paid doubly or trebly by a section of the people or by the country as a whole. There is any amount of gambling going on in these ground rents in the City and County of Dublin. If President de Valera does not believe me, let him ask the Minister for Finance, who knows more than anybody else about this matter, representing, as he does, the County of Dublin. I also am prepared to advocate—every member of my Party will always advocate and in spite of anything will defend—the imposition of increased taxation upon income tax payers, super-tax payers, and on those liable for the payment of corporation profits tax before we face the proposal to impose taxes on food, and especially on the food consumed by the poorest of the poor. I am also prepared, and would be prepared if I had personal responsibility, whether it was popular or unpopular, to put a higher tax on private motor cars which are increasing in number in this country before I would agree to put a tax on the necessaries of life for the poor. I would also agree—the Minister for Finance has already done it to a certain extent —to face up to the proposition of increasing the amusement tax before putting a tax on the necessaries of life. I and my colleagues are prepared to defend a reduction in the existing amounts provided for bounties on the live stock exported from this country, and to search the pockets of ground landlords with a view to seeing what we could get from them in order to find the money which it is now proposed to get by taxing the necessaries of life for the poor. We would be prepared to do that, and to achieve the same end, we would, as I have already indicated, be prepared to take steps to secure the additional money required by increasing the taxes payable by income tax payers, super-tax payers, as well as on those who pay corporation profits tax, as well as to increase the taxes on private motor cars and the amusement tax. That is the reply that I, on behalf of my colleagues, give to the invitation that was extended to us last night by  the Minister for Industry and Commerce on the wireless.
We have been told from the Front Opposition Benches and from the Government Benches, and I agree, that every Party in this country should co-operate in maintaining or increasing the credit of the State. What does the credit of this State represent? I had thought that it did not represent quite the same thing to Deputy Good and the Minister for Finance. The credit of the State to me depends upon this: our ability to put all our able-bodied citizens into useful and profitable occupation rather than having over 100,000 of them placed on the back of the taxpayers. Apparently, Deputy Good and the Minister for Finance—I am judging the Minister for Finance on this Budget— seem to think that the credit of this State depends on the rate of interest which an investor is able to get on his unearned income. That is the difference between Deputy Good and, if you like, the Minister for Finance, and the members of this Party on that question. If contributions and sacrifices are to be called for from the people of this country as a whole, then I suggest that, in the first instance, those sacrifices should be borne by the people who are best able to bear them —the people who are represented in this House by Deputy Good and others like him. For that reason I quoted— indeed, I never thought that I should be able to give such a quotation in this House—the complimentary remarks made by Deputy Good in his broadcast speech on Saturday night on the form of this year's Budget. I am sure that quite a large number of the poor people of this country, if they heard that broadcast and were able to pick up the sense of it, must have almost fainted when they heard Deputy Good congratulating the first Republican Minister for Finance of this State on the Fianna Fáil Budget that he introduced this year.
We have all this additional taxation which is to be put on the people who are least able to bear it. In addition, we have the Minister's proposal in his Budget to cut the old age pensioners by the sum of £100,000 as well as a  reduction of £300,000 in the sum hitherto available for those in receipt of unemployment assistance. The Minister for Industry and Commerce has endeavoured to explain away the proposed action of the Government in reducing the sum available for old age pensioners by £100,000. He explained it in this way: that he said it was being done for the purpose of cutting out waste. I hope that the Minister for Finance when replying, or some other Minister, will explain what is meant by waste, and what sections of old age pensioners are going to suffer as a result of the proposed savings of £100,000. They might explain also the reasons for the proposed reduction of £300,000 in the amount heretofore available for unemployment assistance. Everyone knows that the Unemployment Assistance Act was not in operation over the whole of the last financial year. It is, therefore, impossible to know what the actual commitments under that Act would be if the 30,000 appeals pending had been disposed of under the machinery set up under that Act. I do not know what the actual expenditure would be if these appeals had been disposed of but at any rate that was the number of appeals awaiting decision at the end of the financial year. I am prepared to admit that perhaps a very high percentage of the appeals pending concerned people who were in receipt of some payment at that particular date.
We have been told that all this additional taxation must be provided. Apparently the poor must bear a big share of it in order that money may be found for the social services, including, I presume, more money for relief works throughout the country. I would like to know from the Parliamentary Secretary to the Minister for Finance whether, in the last year or two, a reasonable amount of money was placed at his disposal to enable him to carry out all the useful public works which had been put before his Department for consideration. I am asking that question because I know that in my own constituency a number of waterworks and sewerage schemes  were submitted to the Department of Local Government and Public Health. I am sure that the Parliamentary Secretary is aware that the carrying out of those schemes has been held up because of the failure of the Government to give financial assistance so as to make it easy for the local authorities to go ahead with the schemes proposed. The Minister for Local Government and his predecessor have admitted in this House that it is impossible for a local authority to carry out sewerage or waterworks schemes which are urgently required, not only in provincial centres but in our smaller towns and villages at the expense of the ratepaying community in the dispensary areas concerned. Therefore, a grant is necessary from the Central Government to enable a local authority to carry out such schemes, bearing in mind that the people living in the benefiting area are only able to contribute to a moderate charge arising out of the execution of such schemes. I would be glad to hear the Parliamentary Secretary or the Minister for Finance explain why a number of these schemes has been held up if, as we are told by the Minister for Finance, the money is there just for the asking. Why are the schemes held up in areas where there is an urgent necessity for them? Why is there such a large amount of unemployment locally, with large numbers of people either in receipt of home assistance or of unemployment assistance? Before raising matters of this kind in the House I always take the precaution of corresponding with the Department concerned in relation to such schemes. Since I became a member of the House I have never come here and raised a question of this kind without first acquainting the Department concerned by means of correspondence. It was only when I failed to get satisfaction in that way within a reasonable period that I made a complaint here. I have been continuously pressing the Department of Local Government and the Minister for Finance for grants for schemes which have been held up during the last two or three years. So far as I understand it, these schemes are being held up only because financial  assistance has not been made available for their execution from the Central Government. This Budget, of course, has all the appearance, like previous Budgets, of making provision for the needs of the people of the country, according to the point of view of the Government, for another year during which, I presume, the economic war is to go on. I would like to know from the President, and I think the country would like to hear a statement from him—the Government has been in office for three years—whether, as head of the Government that is responsible to the people, he is throughly satisfied that it is impossible to secure a satisfactory settlement of the economic war with the British Government. I am asking him to make that statement, because I find in going around the country, during the past year or two anyway, that a number of people, farmers and others, are living from day to day, from month to month, and from year to year in hopeful expectation that a satisfactory result is going to be found inside a week, or a month, or a year. I think that if, in the opinion of the head of this Government, it is impossible to secure a satisfactory settlement, then it is better to tell the people in a straightforward way. I am sure that the President will do that if he feels justified in doing it, because then the people can make their arrangements to carry on as if it was impossible for the people to get a satisfactory settlement. The people will settle down and face the facts with greater certainty as to where they are going in the future if they know where the Government and the country stands on that matter. I, personally, should feel more satisfied if I thought it impossible to secure a satisfactory settlement, because everybody would then know where they are and would know that the Government had made every attempt, short of surrender, to make a settlement of the kind which they have the authority of the people of this country to secure.
When the President's Vote was being discussed in this House last year, I made reference to the unfair attitude of the Government in compelling the farmers of the country, who are paying  their rates and annuities and working hard, to bear the additional rates imposed on them under the present policy for the people who are either unable or unwilling to pay their rates and annuities. At the end of a particular period of this year—perhaps it was the end of January—a sum of £700,000 was outstanding in land annuities, and, under the present unfair policy of the Government, the local authorities are directed to increase the rates in the present financial year in order to make up for the losses on annuities in the previous financial year. I feel considerable sympathy with the farmer in the country who, after all, as everybody on both sides of the House will admit, is in the front line trenches in this economic war and who has his coat off and is working hard and paying his rates and annuities; and I think it is very unfair that that farmer, under this ridiculous and unfair policy, should have imposed upon him the duty of paying the annuities and rates of his next-door neighbour, who is either unable or unwilling to pay his rates and annuities. I should like President de Valera to look into that matter and to see whether or not some fund could be established to prevent the honest and hard-working farmer, who pays his annuities, from having to pay for the farmers who are either unable or unwilling to pay. If the local authorities in my area carried out the instructions that they received from the Local Government Department under the existing policy, and if they made provision in the current year's local estimates for the amounts outstanding in annuities at the end of the last financial year, it would have meant imposing an additional rate of 2/6 in Laoighis and 2/11 in Offaly. Why should any farmer, who pays his annuities, have to pay for the fellow who is either unable or unwilling to pay? I hold that it should not be beyond the powers of the Government's financial advisers to find some other means of dealing with that situation than the means they are adopting at the present time.
Mr. Davin: Perhaps, as the Minister for Agriculture did on a former occasion, he will get up now and say that Cumann na nGaedheal did the same. I never thought, when Fianna Fáil was coming into existence, that the time would come when they would merely reply to complaints made against them: that their predecessors had done the same. I never thought they would ever take up the attitude of asking: “What is wrong? If you did it when you were in office, it is all right for us to do it.” Deputy MacDermot referred in a passing way, as I intended to refer to it, to a statement made by the Minister for Finance at a dinner on St. Patrick's night. I think that the Minister for Finance was the principal guest on that occasion, and I understand that the dinner was given by the Clothing Manufacturers' Association. He stated at that dinner— apparently he spoke without figures or facts before him, and apparently he blundered—that he looked forward to a comfortable surplus in the coming Budget. I wonder who pulled the Minister's leg on that particular occasion, and I should like to know whether the comfortable surplus that he prophesied on that particular occasion was a surplus on top of the taxation imposed in the last financial year, or whether he intended his remarks to be taken as meaning a surplus in the present financial year? I should like to know who prompted the Minister in what now appears to be a singularly wrong statement.
Mr. Davin: I freely admit that this Government has gone a good way towards redeeming its promises to improve social services. I freely admit, and I think that every fair-minded Deputy in the House will have to admit, that there is no comparison between what this Government has done in that respect and what their predecessors left undone or promised that they would do. I believe also that it is possible to maintain, and even extend, the existing social services by finding the necessary money from the sources I have indicated, but the members of this Party cannot and will not subscribe to any proposals which, instead of taxing the people who can bear it better, have the effect of putting the taxes on tea, sugar, and other necessaries of life while, at the same time, cutting the allowances of the old age pensioners and those entitled to receive unemployment assistance. I want to say, on behalf of this Party, that while we are prepared to give, as we have loyally given—and we have no apology to make for it—loyal support to this Government on its national or international political policy, and also having given every chance to this Government to allow it to develop its economic policy, because we are satisfied that the people, who voted the Government into power, should get a fair chance of seeing that policy developed, we are not prepared to vote for the imposition of a tax on tea or sugar for the reasons I have given, and we reserve the right, while voting for the general resolution, to vote against these particular items, and we will move to have these proposals deleted from the coming Finance Bill.
Mr. O'Leary: I heard Deputy Davin say, at the finish of this speech, that while offering no apology for his and his Party's support of the Government, he was prepared to disagree with them on some items. I believe that the support  he and his Party are giving to the Government in this policy is bringing destruction to the country, and I believe that, in their hearts, no people know that better than the people on the Labour Benches. I am glad that the Minister for Agriculture spoke, because I like to have a crack at him. The burden of the Minister's speech was: “How are you going to reduce the taxation?” That is not our job. The Fianna Fáil Party, before they came into office, promised that they would reduce taxation by £2,000,000, when the taxation was about £8,000,000 less than it is to-day. I have a few extracts here that I should like to read. It is always easier to read than to think. I refer the Minister for Agriculture to the statements made by the Deputies whom I am going to quote, and I ask him how it is that they are not carrying out the promises they made when they were in Opposition. Mr. MacEntee, speaking on the Finance Bill, on the 17th May, 1928 (Vol. 23, col. 1549, Official Debates), said:—
“I take it that at this stage of the Bill the discussion is to confine itself to the principle of the measure only. Therefore, I intend to confine myself to considering the purpose of the Bill and the method of securing it. This Bill proposes to increase taxation, and to aggravate the already too heavy burden upon our people and upon their industry. We must ask ourselves whether such an increase is justifiable and unavoidable, and whether also it is equitably distributed. According to the figures supplied to us, the minimum amount to be raised by taxation in the current year is £20,735,000. The actual amount raised last year was £20,396,000, so that at the very lowest computation taxation during the current year will be heavier than last year to the tune of £339,000.”
“As most Deputies know, it is much easier to slide on the downward curve than it is to climb the upward one”—I am sorry Deputy Flinn has left the House—“and unless we can rectify the present position, if the nation does start sliding, it will be pretty hard to stop it. I think it is generally admitted by all who have the least knowledge of the industrial conditions existing in the country that the main cause of our lack of progress in industrial matters has been the burden of taxation. As Deputy Flinn pointed out here, the people of this island have not merely to keep up the Government that operates from this Chamber but it has also to keep up another Government in Belfast and to maintain a third Government in pensions. The burden of maintaining the three Governments is so heavy that it is impossible to expect any revival of prosperity or any considerable increase in business productivity in this country. We cannot acquit the Government of the Saorstát of a large share of responsibility in maintaining that unequal and unbalanced burden of taxation which has brought about this general stagnation in trade.”
“The proper way to meet the deficit was by cutting down expenditure, not by the imposition of further taxation. If they had the £1,230,000 paid the ex-R.I.C. pensioners, the £1,500,000 spent on an Army which General Seán MacEoin had said was useless for any national defence, and the land annuities, there would have  been no need to throw fresh burdens on any section of the community.”
“Let none of them think this was a poor country. It was the richest country in the world as a taxpayer. No people in the world, black or white, were paying such high taxes per head of the population, but the millions collected from the people were spent in squandermania.
“In the Free State the farmers were paying 75 per cent. of the total taxation. In Northern Ireland the percentage paid by the farmers was only 25 per cent., and in England 17½ per cent. of the total taxation. How could those in the Free State compete with the farmers in England or the Six Counties while this state of affairs existed.”
“No real effort has been made to reduce the cost of taxation in conformity with existing conditions. Neither has there been any serious attempt made to provide security for the producer, who is crushed by high taxation and the disparity between income and the high cost of living as well as the decline of the English market.”
“But with the lowest wage standard in the community, and no prospect even then of regular employment the labourer was expected to pay high taxes on his wearing apparel, on his drink, his tobacco, to bear, in a word, the high cost of living forced upon him by a Government that refused to make any effort to enable him to bring up his family.”
 The Minister for Agriculture spoke about the British market, pointing out that the position there was not as a result of the economic war but as a result of the quotas. Speaking in the House, before Christmas, the Minister for Defence stated that he was satisfied that the Minister for Agriculture could do no more than accept the quota given to this country by the British Government, and that the British were not in a position to buy any more cattle from the people here. But some time after that a pact was arranged by someone that the Government had not the courage to stand over. The President stated that it had not been signed. He had not the courage to stand over it. Naturally he was ashamed of it when everyone of his followers criticised it. Under the Pact the British were to take 150,000 cattle and we were to take 1,250,000 tons of their coal. As a result of the pact Mr. Thomas stated that the British authorities had been able to collect £700,000 in addition to what they claim. There was a tariff of £6 a head on cattle and a tax of 5/- on every ton of coal which came in here. Taking the tariff on cattle at £5 each it meant a payment to England of roughly £750,000, and a tax of 5/- per ton on 1,250,000 tons of coal would amount to £312,500, or a total sum of over £1,000,000. There is nothing about that in the Budget. The people have been blindfolded, but we are not going to let the Government escape the responsibility. The Minister for Agriculture spoke about the agricultural policy. What is meant by the agricultural policy? I asked Deputy Davin to deal with that and to say how the rate of wages for agricultural labourers compares with what it was three years ago.
Mr. O'Leary: I intend to. How is it that Fianna Fáil farmers are reducing their staffs and reducing the amount of wages that they pay if the country is as prosperous as they say it is as the result of their policy? When he was questioned about the bounties the Minister for Agriculture said that the taxpayers had been paying them, but  that in future it was the consumers who would pay. Did you ever hear such nonsense. At one time the Minister stated that farmers paid 80 per cent. of the taxation. That is on the records of the House. Is there any regard at all for the capacities of farmers to pay such taxation? Deputy Davin talked about the land annuities. I am sorry the President has left the House, as I should like to hear what he has to say in reply to the statement of Mr. Thomas as to the amounts that had been collected from farmers, namely, £4,200,000. The President stated that only £2,900,000 went towards the payment of land annuities, so that the farmers are paying the difference between the two sums. I say that an additional burden has been put on the farmers since then, and that sheriffs and bailiffs are going all over the country seizing cattle in lieu of payment of land annuities. Will Deputy Davin deny that the farmers have paid these annuities already?
Mr. O'Leary: The people will answer it very soon. At Ballyvourney fair I asked a man what he would get for ten heifers and he said £2 10s. each. He remarked that a neighbour who had asked him the same question inquired if any of the calves he sold him two years previously were in the lot and he said “Yes.” I asked him what he had paid that neighbour for the calves and he said £3 apiece. If these cattle were shipped John Bull would have to get £60 out of them. Another man said he bought four cattle and paid £8 apiece for them two years ago. That man sold them at the end of the two years at £4 apiece. I said to him: “Pat, what is your annuity?” and he said: “Formerly it was £10, now it is £5.” He lost £16 apiece on these four cattle and he has against that saved £8 in his annuity.
Does the Minister for Finance think that that situation can go on; or that in two or three years' time his Budget will be even as good as it is to-day? The Minister for Agriculture said that  in this coming year we will be growing 200,000 acres of wheat. I put him the question what is the bounty per barrel and he said the bounty would be 6/6 per barrel which, estimating eight barrels to the acre, would mean £2 12s. per acre bounty. If we multiply these 200,000 acres by £2 12s. we get over £500,000 and that is what this bounty will cost the people of the country. The total acreage of wheat sufficient to satisfy the needs of the people is 850,000. If that area which the Government is aiming at is reached the year after next it will mean £2,125,000, which the country will have to make up in bounties for this item alone. I understand that the estimate of the number of sacks of flour required to satisfy the needs of the people is 2,600,000. If we reach in a couple of years' time the goal at which the Government are aiming, that is 850,000 acres, it will mean a tax on the people for this item alone of £2,125,000.
The Minister for Agriculture told us that we were getting a better price for the grain. I asked him to tell us where is that price coming from? Where is the foreign market to give that price for the grain? Who is paying that price for it? I have a letter here from a merchant in the County Donegal. He is a man well-known in this country and in this House. He wrote me this letter on the 7th of May and he says:
“In reply to your letter of yesterday's date, the price of maize meal in Derry yesterday, Friday, was £5 15s. per ton, retail 5/9 per cwt. or £5 15s. per ton. The price of the admixture here is £8 5s. per ton retail or 8/3 per cwt. There is an allegation that some of the Free State millers are at present putting no oatmeal in the mixture and are getting away with it.”
Our people are paying this extra tax. It is the unfortunate poor people who are not in a position to grow these crops who have to pay these extra moneys. I have already raised this question in this House, and as long as I am here I will raise it and I will condemn the injustice of it. The  Minister talks about the tillage policy of the Government. Some time ago the Minister said the people should increase their cattle production. He said they would require more cattle to eat what was produced on the land by the increased tillage. He has changed from that now and his policy is to kill the calves. My friend in Donegal in his letter continues:
I mentioned that matter to the Government in the hope that they would take the matter into consideration and get this man and people who are in the same position as he is a market for their oats. The Minister tried to do away with the British market. He said the British market was no advantage to us. How is it then that the Government finds £3,433,000 to give in bounties for maintaining the British market? Does not that clearly point to the dishonesty of the Government and the dishonesty of their whole policy.
Deputy Davin at last is beginning to realise the position. The Deputy and other Deputies must soon realise that the policy of the Government is leading to more unemployment in the country. Was there ever a time in the last 13 years when there were so many unemployed as to-day? I invite any Deputy on the Labour Benches to look into the matter for themselves. I invite the Labour Deputies, if they like, to come to Cork. Let them go round to the farmers' houses. They will there find out how many farm labourers and farm girls have been put out of employment in the last three years. This is the case amongst the followers of the Government just as it is amongst the opponents of the Government. The people are being put in the position that they cannot pay wages. I strongly appeal to the Labour Party to study this matter themselves and to realise what is happening. I hope Deputy Everett will carry out the pledge he gave last Sunday in Baltinglass, and that is at the first opportunity to remove the present Government from office.
Minister for Education (Mr. Derrig): We have had two points of view expressed in the Debates to-day. One point of view was represented by Deputy Davin, and the other by Deputy MacDermot. Deputy Davin condemns the present Budget as a bankers' Budget. In his view it stands condemned by reason of the fact that it means increased taxation which the whole community will have to pay. Deputy MacDermot tells us with all the keenness of a good banker and a sound financier that the Budget does not go far enough, that there is too much borrowing. Borrowing in Deputy MacDermot's scheme of things should be absolutely confined to projects which would return revenue. I think that in this discussion on the Budget the Minister for Finance has had a disadvantage, in so far as the unpleasant duty falls on him of collecting the cash by means of which the administration of the country is to be carried on for the next twelve months. On that account the Minister for Finance is naturally driven sometimes to do very unpopular things. But look at the other side of the picture. Look at the purpose for which this money, no matter how unpopular the means by which it is raised, is being raised. The purpose for which the money is to be raised should be brought into the picture. I was glad therefore that my colleague the Minister for Agriculture referred to the fact that under the present administration, social services have been increased to double what they were under the previous administration. Not alone have there been substantial increases in regard to Old Age Pensions for example and entirely new schemes in connection with Unemployment Assistance, but a Widows' and Orphans' Pensions Bill has been introduced, any one of which would in itself be acclaimed by any Government functioning in a small country of this kind as being a wonderful achievement. But in addition to this achievement, the Government is carrying through a very advanced programme in regard to its housing policy. It is forgotten by the Opposition that a very substantial liability lies upon the State in connection with  that housing policy. It is forgotten that the State has to pay two-thirds the cost of a large amount of the building that is going on at the present time. In addition to that the Land Commission are carrying out a most intensive campaign for the division of lands. They are placing the population from the congested districts upon large estate in the Leinster counties. That is in progress at present. This year three times as much land will be divided as has been divided in any previous year. In addition there is a very substantial programme in connection with afforestation being embarked upon. In my own Department, a Department that has not made any great claims in the way of extra expenditure upon the resources of the Minister for Finance, we are spending £200,000 on new schools, the provision of proper accommodation, and the whole of that amount has been raised from taxation. I do not think that these examples which I have given can do anything else than convince the ordinary citizen that this money that is being raised, even if it is being raised in an unpopular manner, is certainly being spent in a most useful way.
Deputy Davin suggested that some other sources of taxation could have been tried out. I leave that point to the Minister for Finance. I think we can rely upon the Minister to ascertain for himself where the money can be secured, and if he has been driven to tax the ordinary necessaries of life, we know that it is not from choice, but from compulsion, because he feels that the money cannot be secured elsewhere. There would, of course, be an alternative in reducing these social services that this Government pride themselves upon and that they have set such a valuable headline in introducing. We are not in favour of that, and the reductions, as Deputy Davin calls them, that have been made are because we are satisfied that the intentions of the Government and of the Legislature can be fulfilled both in regard to unemployment assistance and old age pensions, and that no hardship need be inflicted upon any person who is properly and fully entitled either to unemployment assistance or an old age  pension by administering the law in a somewhat stricter manner. That is the position with regard to these two services.
It is also forgotten in connection with this question of the raising of revenue that, apart altogether from the social services which the Government have introduced, new services are being created every day. The State is being asked every day to interfere in industry and commerce, to interfere in agriculture, to interfere in matters of public health, and in connection with practically every Department of State and every aspect of the life of the community the State is being constantly asked to carry out additional functions. All these additional functional cost money and necessitate additional staff and additional taxation. Furthermore, the sums that we were accustomed to raise in the past from some of the well-known taxes are beginning to disappear. In the case of sugar, for example, the Minister for Finance pointed out that he has lost about half a million pounds. It is obviously quite impossible for the Minister to carry on, in view of the constantly increasing services and the constant demands being made upon him, unless he is empowered, when he loses a source of revenue in one direction, to seek an equal amount of money in some other direction. Not only in connection with sugar, but in connection with Customs, there has been a great reduction in the amount collected, and in the future, owing to the successful operation of the industrial policy which the Government are carrying out, we may expect to see a still further decline in Customs duties.
In connection with land annuities, Deputy Davin tells us that the Guarantee Fund, which ensures to some extent the collection of land annuities by imposing a penalty upon the ratepayers of the counties in which the annuities are not paid, to the extent that they are not paid, can be abolished. I should like to point out to the Deputy that, had the annuities been paid in full, I think that some of the extra taxation which is being imposed during the present year might have been avoided. Furthermore, the  Minister for Finance could have taken a more cheerful view generally and might have been able to do something further for the benefit of agriculture if the land annuities situation had been somewhat better. But we all know that the land annuity situation has meant increased cost upon the State in the collection of annuities, and that in some counties there are very heavy arrears indeed. If the Deputy or anybody else can suggest that the position of the Government, if the Guarantee Fund were not there, would be anything else but a particularly unfortunate one, and that the position of the collection of annuities would not be very much worse indeed than it is at the present time—I would be glad if any Deputy could show that. The position is that, due to the steps which the Government have had to take in order to try and avoid extra taxation and further impositions upon the people who are not annuitants to make up for the default, the annuities have come in and there has been a very substantial improvement. The extraordinary point about that whole situation is that the poorer counties like Mayo, Leitrim and Donegal, where we have holdings of £2 and £4 valuation on an average maintaining large families, counties which, as Deputy MacDermot mentioned, have suffered severely by the reduction in the American remittances and by the fact that they have to provide for these large families, have been in the forefront in the payment of both rates and annuities, and the richer counties have been not at all what they should be.
Deputy MacDermot referred to the fact that under a free Ireland taxation would still be greater. As the Minister for Finance pointed out in his opening statement, we have to pay for the privileges of self-government and being able to control our own affairs. When we remember that old age pensions, amounting to between £3,500,000 and £3,750,000, education, amounting to something more, the police, the Army, and all these other services I have referred to, which have been introduced since the Irish Free State Government came into being, I think all of us, no matter what  our political views may be, have reason to congratulate ourselves on the marvellous strength of the Irish people, on the way in which they have faced their responsibilities and on the splendid manner in which the State has met its obligations and has succeeded in weathering the storm so far, when we see so many large, wealthier, and much greater countries—some of the great powers of Europe—in a much worse position and not knowing where they stand. We, at any rate, while giving the fullest possible benefits to our people, while remembering always our first duty was to the unemployed and to the poor, have also in our minds the fact that we have to try and pay our way, that we have to try and meet our obligations.
In some years, as last year showed, when the position is favourable and the occasion is propitious, the Minister for Finance, if he can do it, certainly will reduce taxation. In other years, of which the present is an example, when extra taxation is necessary in order to maintain our services, and the only alternative is to have a wholesale reduction in these services, the Government have faced up to the situation and have imposed extra taxation knowing that the Irish people will fully understand the position and knowing that they will appreciate the duty all the more because it is unpleasant, because it is unpalatable, but because it has to be done for the benefit of the whole community.
I should like to remind Deputy MacDermot and those like him who talk about the dangers of freedom and the responsibilities it involves and the possibility that we may not be able to shoulder our burden, that we in the Free State, at any rate, faced as we are with the consequences of the economic dispute, and with the serious position among our farmers, and admittedly other unfavourable factors in the situation, have reason to congratulate ourselves when we compare our position to that of others not so far away who have to be buttressed and subsidised by people across the water in order to enable them to maintain their position. So long as it is a question of maintaining our independence  here, of maintaining our institutions and of maintaining our services, I do not think we need have the slightest doubt but that the Irish people will respond when they are called upon. They will give in regard to social and economic affairs that leadership which they all would like to give, that leadership which will show that this country, small as it is and poor as it is, but with a fine democratic spirit among our people, can give services and show a record of achievement in our State affairs which very few small countries in Europe can show.
Mr. Fitzgerald-Kenney: I think during the course of the speech which has just been delivered the Minister for Finance must have felt very unhappy indeed—that is during such portions of the speech as the Minister for Finance listened to—because I think it would be very hard to put forward a more damning indictment of Fianna Fáil and its Government than the damning indictment that the Minister for Education has just made against the policy of his own Government. The Minister for Finance, we are told by the Minister for Education, does not like his own Budget. The Minister for Finance hates his own Budget, according to the Minister for Education. He has been driven to tax the ordinary necessaries of life, not from choice but from necessity. Now what does that phrase mean? Is not that the most complete and entire admission that Fianna Fáil has so mismanaged the affairs of this country that there is no tax to be derived from any other source except from the pockets of the very poorest members of this community? What are those extra taxes? 4d. on tea, ½d. on sugar, 8d. per lb. on tobacco, and 6d. per cwt. on wheat. Everything that the poor want, everything that the needy require, is taxed here. Everything that the person living on an old age pension requires is taxed here. Every necessity of the person living on outdoor relief or on the dole is taxed here. And the Minister for Finance is driven to take that course, we are told by the Minister for Education, because there is no  other possible or conceivable source of revenue left to him.
We have the same cry coming from all the Fianna Fáil Benches: “We have exhausted every source of revenue; there is nothing left. If there is anything left, for goodness' sake come out and tell us what it is.” That is the cry of the Minister for Industry and Commerce, as well as of the Minister for Education. It is also the cry of the Minister for Education to-day: “Tell us what else we are to tax”—an appeal to the Opposition to frame a Budget for them. We discover at any rate that there is nothing which they can think of for themselves, no scheme that they can devise for themselves, except this ruinous and cruel Budget which the Minister for Finance has introduced into this House. I say “cruel Budget” because it is a cruel Budget, at this time when, through the mismanagement and through the misgovernment of the present administration, there are more people hungry or in danger of being hungry than there has been in the lifetime of the oldest man in this generation. That is the very time at which it is the moral duty of the Government to see that the cost of living is reduced, and that is the very time at which the Government, by their own admission, are driven to increase that cost of living. What is the use of the Minister for Agriculture getting up in this House and informing us that the whole country is prosperous, that the farming community are wonderfully well off and that there is no poverty of any kind? What is the use of that? By some extraordinary method of self-hypnotism, the Minister for Agriculture may possibly drive himself into a belief in the truth of his own words, but there is not one other person either on the Fianna Fáil Benches, the Labour Benches, the Independent Benches or on our Benches who does not know that that statement of the Minister for Agriculture is absolutely false in fact.
But, says the Minister for Education, we are spending such a lot; we have all those new services other than the social services; we have all those new inspectors to whom we must pay those  salaries. Why have them? Half of them are unnecessary. We have, says the Minister for Education, all this Army to keep up, all the Guards to keep up, and all those other extra expenses. If the Guards are costing the country now more than they cost the country before Fianna Fáil came into office, that is due to the misgovernment of Fianna Fáil. The Minister for Education says: “We have got to support this Army.” Why increase it? Why start your Volunteers, so called? Why people who receive pay are called Volunteers, which is certainly a contradiction in terms, I do not know. But why establish them? What good are they doing? What useful purpose are they serving, might I ask? At a time at which the poorer members of this community are struggling to exist, certainly in the country areas, that is the time at which the Government proceeds to take and keep for a considerable time at the public expense a certain number of young men, doing nothing, serving no purpose, and never capable of serving any useful purpose. If you want them there for ornament, by all means have them there and spend your money on that ornament at a time when the country can afford such luxuries, but this is not a time at which the country can afford anything of the kind.
The Minister for Education tells us that the poorer counties are paying their annuities. They are, but why? The poorer counties, and I invite the Minister to go to his home town and check my words, are paying their annuities, and the fact that the annuities are better paid and the poor rates are better paid in such a county as Mayo is due to one cause. There has been a very great agricultural and industrial revival in England; there is an enormous number, much more than there has been at any time since the Great War, of young men from Mayo working in England, and it is out of the wages they are receiving that their parents are paying the annuities and rates. Not only are those young men working on the agricultural farms in England, but great numbers of them are receiving employment in the building trade. It is not because of any  prosperity that Fianna Fáil has brought to Mayo that Mayo stands in the forefront of the counties that have their annuities paid. Fianna Fáil has brought nothing but poverty of the direst type to the County Mayo, and, except for the English earnings, Mayo at the present time would have been plunged into complete ruin.
But, says the Minister for Education, with a great flourish of trumpets, the first duty of the Government is to the poor, and he adds that in this Budget they are carrying out their duty to the poor. What is the duty to the poor? It is not what one would expect it to be defined as. At a time of stress and trial, when the cost of living should be cheapened to them, they carry out their duty to the poor by adding to the cost of living, increasing the burthen of taxation upon the poor and driving the poor to do without the necessities of life. That is the duty as defined by the Minister for Education. That is what the Government are doing, and that is what the Minister calls doing their duty to the poor. The Fianna Fáil conception of that duty appears to be this: “Tax the poor; make life unendurable for them.”“And then,” says Fianna Fáil, “we will have performed our duty to them.”
The Minister for Agriculture talked a great deal about the benefits which farmers are receiving or are supposed to receive. He talked a great deal about the area of wheat being increased. I would like to point out that an increase in the area of wheat does not increase the national wealth, but actually decreases the national wealth. Whenever, by a subsidy, you make an article dear, you are decreasing the national wealth, and every acre of wheat which is grown at a loss, and cannot be grown otherwise than at a loss and cannot be grown without a subsidy to make it in any way profitable, may be a source of wealth or it may not; it may be a source of wealth to the individual who is cultivating the particular field in which the wheat is grown, but it is obviously a lessening of the total wealth of the community. On the other hand, when you had an industry self-supporting—and you had a splendid one here—when you had a  great agricultural industry self-supporting, as it was, then the produce of agriculture, needing no subsidy, standing on its own feet, was adding enormously and was giving almost the total addition to the national wealth. But you have struck it away. You have deliberately put an axe to the root of the tree. You have deliberately, by your policy, ruined Irish farming, made it utterly impossible for any branch of Irish farming to stand on its own feet profitably, made it absolutely impossible for any farmer to make money out of his land unaided by subsidy.
It was quite the other way before you came into power. If you do manage to get here and there a certain area tilled at a profit to the individual, you are covering a very small area indeed of the whole Free State. This Budget must have driven home into the minds of every supporter of Fianna Fáil who has got intelligence that unless agriculture is put upon its feet again, as it can be put, it means a national bankruptcy. You must put agriculture again on its feet or you will soon come to your very last resort, a tax upon the food of the poor. You can put agriculture on its legs and make it again a profitable industry when you end the economic war into which you rushed so blindly and of which you fired so exultantly, in President de Valera's own words, the first shot.
It is high time that sense came here. It is high time that the policy which President de Valera announced before he became President of the Executive Council, the policy of non-co-operation with England—a stupid policy—should be driven out of the President's mind and out of the minds of his Executive Council. You have got your non-co-operation, if you like, and what good is it to you? You have lost the English market, but you can get it back—I do not believe anybody doubts that—by reasonable negotiation. You can take the £5 or £6 a head off Irish cattle and you will not have to slaughter your calves, because you can sell them profitably. Fianna Fáil used to declare that the quota system could never be changed, and yet it is perfectly obvious from the treaty which has been entered into that it is far easier to get the  quota removed than to get the import duty taken off the stock going in. There is one way in which this country can be saved, and that is by putting agriculture on its feet. Agriculture cannot be put on its feet until there is a proper system of mixed farming in this country. That is the whole solution of the problem, and that is the thing which you have made absolutely impossible. You have killed mixed farming, and in killing mixed farming you have, for the time being, at any rate, knocked out Irish agriculture.
Mr. Fitzgerald-Kenney: I have no objection to Deputy Donnelly carrying out any bloodthirsty designs he has in his head. He can be as bloodthirsty as he pleases. Another interesting speech which we heard this afternoon was the speech from Deputy Davin. I was very interested in Deputy Davin's speech. He began so bravely and finished so meekly. He was all passion and all fury in his denunciation—and quite a good denunciation—of this Budget. Of course, every denunciation of this Budget must be a good denunciation, because the thing is so intrinsically bad that, to mention it at all, must be sensible. We had Deputy Davin proudly stating that they voted for the Government's national policy, but that they would never give the Government a blank cheque. Oh, no! I rather hoped that there was going to be from the now empty Labour Benches some little show of spunk, some little courage and something to show that all these brave words meant—I will not say brave actions—ordinary non-cowardly actions.
We get Deputy Davin winding up, and what is his attitude to this Budget which he has so vigorously denounced? He is going to vote for it. So, we have the example—great courage in the talk, with no blank cheque, but, much as we hate this Budget, we are going to vote for it. That is the courageous attitude  taken up by Deputy Davin, the spokesman of the Labour Party. You have the Labour Party beautifully, and I congratulate you for what they are worth. They may talk against you and they may growl, but let Fianna Fáil whistle and Labour will give up its growling and come to heel pretty quickly. You have trained them beautifully and I congratulate you—I beg your pardon, Sir; I see reproof in your eyes—I congratulate the Fianna Fáil Party on the admirable way in which it has trained the Labour Party to obey its whistle.
I do not wish to detain the House at any greater length. This Budget stands self-condemned. It is such a weak Budget, such a hopeless Budget, that I do not believe a stronger or more damaging speech could be made against it than the speech nominally made on behalf of it, to which we listened a few moments ago, by the Minister for Education. Let the country take that speech and study it, and if there is anybody left in the country who is not convinced that Fianna Fáil, by its policy, has destroyed the financial resources of this State, the financial resources which they received in such a splendid flourishing condition a couple of years ago, that person must be bereft of all intelligence.
Mr. Anthony: This Budget is remarkable for two things. In the first place, it reveals the fact that the Fianna Fáil Government is beginning to find out that promise and fulfilment are two different things, and, in the second place, the fact that it has come to recognise that, while it is generally regarded as a truism that you cannot place a burden on any industry which that industry is not able to bear, neither can you place on the shoulders of the taxpayers any increased taxation which the community is unable to bear. It is also an indication that Fianna Fáil have gone through at least two stages of their political and economical development, and notwithstanding the laboured jokes of the Minister for Finance in introducing his Budget, he has had to have recourse, in endeavouring to balance his Budget, to various artificial aids. It was alleged against  the Government that preceded this Government, namely, the Cosgrave Government, that they were extravagant, that they were parsimonious, and that, in fact, they did not react to the many demands made upon them for increased social services and so on, but this Government, while admittedly having made some advancement along the lines of giving somewhat improved social services, have adopted, in my view and in the view of anybody who has given even a very small amount of attention and reading to the policy of the present Government, a policy of robbing Peter to pay Paul.
In a speech made recently by Deputy Norton, a strong supporter of this Government, he said that in their endeavour to make the Budget balance, this Government had raided the old age pensions and several of the other social services. I have the exact words here, if the Minister wishes me to quote them. Notwithstanding that adverse criticism of the Budget, and notwithstanding the adverse criticism of the Minister's action in raiding, as he called it, the old age pensions and the other social services, the Labour Party, in my view, were quite inconsistent in going into the Lobby and supporting, for instance, the impost on tobacco, the impost on sugar, the impost on amusements and also in giving every indication that by their support of the Government, they favoured the continuation of the 5/- tariff on coal. It must be admitted, even by the Minister himself, that all these things are regarded by the working-class people of this country as necessaries, with the exception, perhaps, of one, namely, the cinema. That may be regarded, if you like, as a luxury, but in any case, it is a luxury enjoyed by very large numbers of the population and it is not always to the cheaper portions of these houses of entertainment that the working-class people go. It is well known that, in many cases, for the extra comfort enjoyed in those theatres, they patronise some of the higher priced seats. I cannot understand the attitude of the Government after making such great professions of their desire to give us  better social services. Here, at one stroke of the pen, they almost negative some of the good legislation, or, at all events, some of the legislation having for its object the alleviation of the wants of the poor, the aged and the infirm.
The Minister for Industry and Commerce, in a broadcast speech, alluded to some of the things said by those people who broadcast before him. He took to task the speaker who spoke on behalf of the Labour Party because perhaps there was an error in his speech suggesting that a sum of over £300,000 would be taken away from old age pensions by the Minister for Finance in order to balance his Budget. The Minister for Industry and Commerce, in his broadcast speech, admitted that a sum of £100,000 will be saved on the administration of old age pensions. I am at a loss to know how, or where, that amount of money can be saved unless by curtailing or limiting, in some way, the number of people who would in ordinary circumstances—and by ordinary circumstances I mean the circumstances under existing legislation—be entitled to receive these pensions. £100,000 is the estimate of saving under that head. Certain economies are to be effected which are represented by that sum.
We are told that a sum of £250,000 will be required to finance the Widows and Orphans' Pensions Bill when it becomes an Act. I have always regarded the principle underlying that Bill as one of very great importance in this country. I welcome that Bill, but, at the same time, I feel that it is more than offset by the raid which is about to be made on the Old Age Pensions Fund. Again, we must estimate, because this is a contributory scheme, and I think it would be a fairly conservative estimate, that the sum that would be subscribed over a period of two or three years by those insured for that purpose would be at least £250,000. I have even heard it suggested that almost in the first year a sum of £250,000 would be subscribed by the persons who will be affected by this Bill. I do not see anything very generous in that. It is simply paying back to those contributors the sums  for which they have insured. There is nothing very generous in the attitude of the Government in that respect.
It is also said, on the authority of the Minister for Finance himself, that a further saving is to be effected under the head of unemployment assistance. I cannot for the life of me see why these funds should be raided at all. We find the only excuse that can be put forward by the Minister is that he was driven to his wits' end to balance his Budget. I made reference a moment ago to the speech made by the leader of the Labour Party condemning the Budget. He said: “The Budget would make dismal reading among the poor. it raided social services, it raided the unemployment assistance benefits funds, it raided the old age pension fund, and it imposed upon needy people taxes on tea and sugar and possibly taxation on flour.” Notwithstanding this declaration by Deputy Norton, he and at least two other members of the Labour Party, by their action in the Lobbies of this House, acquiesced in the very things that Deputy Norton complained of on behalf of that Party. They acquiesced in the taxes on flour, tobacco and entertainment. These mean dearer tobacco, dearer flour, dearer entertainments. Of course, they will tell their followers in the country that they voted against the taxes on tea and sugar. All this must be regarded by the Fianna Fáil Government themselves as merely a gesture, because the moment the Government were in any danger the Labour Party, I regret to say, did not show the backbone that was at one time traditional in the Party, and did not translate their speeches into action by going into the Lobby against those imposts that most of them had condemned so eloquently.
Mr. Anthony: Deputy Anthony showed a bit of pluck that might well be imitated by members of the Party opposite. I do not want to misrepresent anybody but Deputy Everett declared that he would vote against every impost that would affect the  working people of this country. It is rather remarkable that when the occasion of translating these views into action arose, and when the occasion for defending the poor, the needy and the working-class people arose, the Labour Deputies went into the Lobby in support of the Budget with which we are now dealing.
I am not disappointed with this Budget, but I am certainly dissatisfied with it. I am not disappointed because, without wishing to repeat a charge so often made, and repeated, in this House, we know that Fianna Fáil when seeking the suffrages of the people proclaimed that if they got into office and into power they could run this country for at least £2,000,000 per annum less than the Cosgrave Government. We all know now what has happened. That is the reason I opened by saying that there is a big difference between promise and fulfilment. I also regard this Budget as showing that neither this Government nor any other Government can go on extravagantly and recklessly spending money without having to face the day of reckoning. I would commend this particularly to the Labour Party: every penny, shilling and pound spent upon unnecessary undertakings, such as extra police force and additional armies, lessens by hundreds of thousands of pounds the amount of money available for social services in the country. I am glad that Deputy Davin is now in the House. I want the Labour Party to take to heart a few words of advice that I am offering to them gratuitously.
Mr. Anthony: The Labour Party pretend a wonderful solicitude for the working class, the poorer people and the aged and infirm. Any tyro in economics—Deputy Flinn, for instance —will tell them that one cannot take out of the common pool more than there is in it. The wealth of this country may be compared to a large sum in gold or notes contained in a pool. The more you take out of that  pool, containing the common wealth of the country, to devote to services such as extra military and extra police forces, the less you will have in the pool for the things that were so dear at one time to the Labour Party. The less there will be for old age pensions, for widows' and orphans' pensions, and the less the poor man will have to spare for tobacco, food and amusement —items which are taxed in this Budget. I want to know what Deputy Davin and the Labour Party have to say to that? How wrathful they used to be at the imposition of even one penny on the poor man's breakfast table. Now, we have a tax on sugar, a tax on tea, a tax on amusement; and all these things are necessaries, as Deputy Davin and the Labour Party know. Yet Deputy Davin and the Labour Party will go into the lobby to-night or tomorrow night with the Government Party, because they are tied hand and foot to Fianna Fáil.
Mr. Anthony: The Budget has one redeeming feature. It will open the eyes of the electors to the fact that some of the promises of Fianna Fáil have cost the country very dear. Some of their promises have landed us into an economic struggle with the people across the water. I do not want to dilate upon that. I pass to another item in the Budget. It is contained in Financial Resolution No. 10. Reference No. 15 refers to “paper without any matter or design printed thereon”. On that class of paper there is to be a duty of 5 per cent. charged. I should like to know from the Minister whether that duty is applicable to what is commonly known as news print? The Minister does not reply, so I propose to develop that point.
An Ceann Comhairle: I suggest to the Deputy that the Report Stage of these Resolutions, or better still, the  Commitee Stage of the Finance Bill, would provide a more suitable opportunity for going into the details of the different Resolutions.
Mr. Anthony: I shall defer what I have to say until the Finance Bill is before the House, but I should like to know from the Minister now what he means by the phrase, “paper without any matter or design printed thereon”? Many persons in the newspaper industry and general job printing trade fear that this item will involve a tax on newsprint. I am sure the Minister never intended to put a tax on an industry which is giving so much useful employment. A tax of that kind would only result in reducing the number of persons employed in the industry. What I have to say further on that item I reserve for the Finance Bill.
A number of people feel much aggrieved at the new burden placed upon them in relation to their ground rents. The tax the Minister thought fit to impose is going to press very heavily on a number of thrifty persons. A large number of working-class people have made arrangements to purchase their houses over a period of 25 or 30 years, dependant on the amount of deposit they were able to put down. Numbers of these people will be unable to bear this extra burden.
Mr. Anthony: Even the President has to contradict Deputy Davin. The Deputy ought to read the Resolutions. I think the Minister should consider a proposal for taxing the rents rather than levying the tax on the valuation. I quite understand that, in respect of building ground, the tax is heavy enough already. Is it not on the valuation that the extra tax is put? Perhaps the Minister will say if I am correct.
Mr. Anthony: Numbers of people have built houses through the medium of public utility societies and other agencies and they will suffer most. I  should like the Minister to consider— if he can do so at this late stage—how he could make up for the losses sustained by these people.
Parliamentary Secretary to the Minister for Finance (Mr. Flinn): Deputy Fitzgerald-Kenny is, unfortunately, beginning to cultivate not merely a gramophonic manner but the manner of a gramophone running down. When the wind is running out, the tone gradually falls and falls until it seems to get down below the instrument altogether. Mentally, physically and spiritually, Deputy Fitzgerald-Kenney is cultivating that particular habit. What he dragged in to-day for his gramophone record were the poor—the poor upon whom all these taxes are being put, the poor who are to be taxed out of existence, the poor whom he never taxed, the poor, the taxing of whom he would not tolerate. Now we are all familiar with this: that whenever any vested interest is challenged such, for instance, as breweries, all the shares are held by the widows and orphans. In exactly the same way, when any tax is put on which is an indirect tax the only people who pay it are the very poor. Now, everybody knows that is not true. The one thing that I agree with in the whole discussion, on both sides, is the fact that this Budget has brought people up against the facts, and I am glad they are brought up against the facts—both sides of the facts. One of the facts is that all the tobacco, all the butter, all the bacon, all the tea and all the entertainment is not consumed by the poor. Tobacco, sugar, tea is eaten, consumed or drunk by every member of this Dáil, by every member of the Strangers' Gallery, by every member of the Reporters' Gallery——
Mr. Flinn: —by every member of the Seanad, by every member of the Chamber of Commerce, by every member of every golf club in the country, by every one of the thousands of people who have been storing up knowledge of the doctrines of Cobden in the last few  weeks. Everybody knows that, and why anybody should have the effrontery —Deputy Davin is not the only one, not by any means—to get up in this House and keep on speaking, deliberately ignoring the fact that every member of the House knew he was talking nonsense, I do not understand. Does anyone now deny that all of these things which we are supposed to be only extracting from the very poor are consumed by the whole community, and, if they are consumed by the whole community, on whom better, or more rightly, should the taxes be put? Deputy Anthony says that these are taxes which fall upon the working classes. Why should they not fall upon the working classes?
Mr. Flinn: We will take income tax later. Is there anyone saying that taxes should not fall upon the working classes? I think we were told by Deputy Davin that the only asset to the country were the people who are working. We believe, Deputy Davin believes, the members of the Opposition and members of the Government all believe that three-quarters of the population of this country are made up of the working classes of one kind or another. Is anyone here going to say that three-quarters of the total population shall be exempt from taxes, and, if they are not going to say that, what is the grievance? But, perhaps, they will say, could you not choose taxes none of which would be paid for by the poor?
Mr. Flinn: Why was food taxed by Cumann na nGaedheal when they put a tariff on butter? Because it paid them to do so. Why should people be exempt from taxes? Why put a tax upon beer? Some people regard it as a food? I am told there are people who say that beer “is food and a  night's lodging to you.” I am trying to get down to basic fact. Is there anyone in this House who says that taxes should not be put upon the working classes? Is there anyone here who says that tea, sugar, tobacco and amusements are preponderantly consumed by the poor, and no others?
Mr. Flinn: We could get Irish butter a good deal cheaper if Cumann na nGaedheal, after a two days' debate, having definitely refused to put a tariff on, had not held a Party meeting and came down the next morning and put a prohibitive tariff on. That was for the purpose of increasing the price of butter and increasing the price of food.
Mr. Flinn: What I like about this Budget is that it brings everybody up against the facts, and I again ask the question: Is there anyone here who says that the working classes per se— because they are the working classes— should be exempt from taxes?
Mr. Flinn: We will take that in a few minutes. The Deputy with his colleagues went into the Lobby on the other side to vote against a particular tax. Can he get a majority in this House to raise the income tax? Can he get those who went into the Lobby with him to say that income tax should be raised? He cannot. They are only using him for a purpose.
Mr. Flinn: Now, broadly speaking, we have got rid of two wild statements. One was that if you tax tobacco, amusements, sugar, tea that these are per se taxes on the very poor, and only on the very poor.
Mr. Flinn: And you get rid of the idea that there is any privileged class in this country who can refuse to take its share of the burden of carrying on and administering this State. Now the next thing that Bombastus Furiosus said was this: ánything which costs more to produce in this country than we could buy it from elsewhere diminishes the national wealth. That is an amazing statement to make. It was made from the front bench opposite, and I doubt if there is a man behind him who believes it. But an ex-Minister was allowed to come in here and made that statement, knowing full well that there is nothing, I think, in the whole range of our possible production which could not be produced elsewhere and put into this country cheaper than we could produce it, and  yet everything that we produce which is dearer than could be imported, is a reduction of the national wealth and, therefore, the only way in which we can increase the national wealth is to cease production. The maximum wealth of this country is in a country which produces nothing under present conditions. Now, that is the Deputy's argument. Yet, knowing all that, at the last general election, when they were offered all these things, when they were faced with all these industries of one kind or another in which, under the protection and shadow of tariffs or quotas, production was going on, they said, “We will not remove one of those.” Now, which are we to listen to —Sergeant Buzfuz, or the electioneer? The difficulty we have is to find out which of all the voices that we hear are to be heard.
I shall take another example. As a matter of fact, I think it was the same orator who said that Deputy Davin had denounced the Budget and voted for it. That may be very reprehensible, but certainly it does not lie in the mouth of the Opposition to complain of that. I remember in this House, on a Bill in relation to juries that was introduced here, a man on those benches representing Cumann na nGaedheal getting up and saying: “This is a prostitution of the jury system”—and then he voted for it. Are we to do as the preacher does or as the preacher says? It is just the same if you go back through all of their speeches—one after another they are contradicting one another. Take Deputy MacDermot, for instance. He will not allow us to regard the conversion or redeeming of the Dáil Eireann Loan as a thing which we can convert; and yet he says that he is in favour of regarding us as a free country, capable of carrying on our affairs like other people. Then, Deputy MacDermot also says: “Why do you not raise the income tax?” But when we ask him whether he is in favour of raising the income tax, he will not say a word; he already in his speech has given a reason why he should not. He says that, in his opinion, you have reached the saturation point  in income tax. That solves it, as far as he is concerned. Yet, he asks us, why do we not do it? Deputy MacDermot also says—and this is a fine phrase—that he is appalled at the quantity of expenditure. Now, just try and get that one. Expenditure and service are interchangeable terms, apart from the relative efficiency or inefficiency of the Government institution which carries it out. Therefore, he is appalled at the quantity of service. Therefore, he is appalled at all the housing we are doing; he is appalled at even the relief schemes which Deputy Davin regarded as inadequate; he is appalled at the loans and subventions we are making for the purpose of arterial drainage. He is appalled at the quantity of expenditure! He would not tell us, however, what part of it he wants reduced.
Now, the Opposition say that that is what the Government say. The Opposition are complaining that we say: “Point out what you want taken away.” We are entitled to do that. We are entitled to ask you to say, if you are appalled at the total quantity of expenditure, what amount of that expenditure you want removed; because, if we remove the expenditure, we must also remove the services.
Mr. Flinn: Deputy MacEoin says: “Settle the economic war.” That is one of those abracadabra phrases, one of those open sesames, one of those wonderful words which do everything! Three times in this House I have asked the responsible Opposition to tell us the mysterious terms, that they know and that no one else knows, on which they can end the economic war in a way which would be honourable and satisfactory to Deputy MacEoin, and they have not done so.
Mr. Flinn: There was once a very famous man called Demosthenes—I am sure that all the Deputies are familiar with his name—and he was the only man who ever lived who could speak with a pebble in his mouth and be understood.
Mr. Flinn: The whole truth of this debating discussion was told by Deputy McGilligan in the very first words he said in the debate. He said: “I would like to say a few practical words before I get into the usual skirmishing.” We have had two days of the usual skirmishing. Each Deputy on the opposite side gets up and contradicts the other man.
Mr. Flinn: Demosthenes again? Take Deputy McGilligan alone. He said that the one thing that is perfectly sure is that the farmer was bled and bled white; and before he had said that, the things he was talking about were sugar, butter, meat, bacon and wheat. Everyone of those are cases in which subventions of a definite character have been given to the farmer. They cannot have them both ways. I do not care which way they have them, but certainly they cannot have them both ways. Deputy McGilligan goes on to say that the purchasing power of the people is reduced. That is simply an assertion. Deputy McGilligan knows that  the cost-of-living figures have been published. He cannot be saying such things in ignorance, except in privative ignorance. Then he says: “How long is this rogue's progress going to last?” By the rogue's progress that is required, he means the tax upon butter, that was imposed by the Cumann na nGaedheal Government, the tax upon tobacco, which has always been there and was imposed by the Cumann na nGaedheal Government, the tax upon this, that and the other thing. Yet, there are resolutions on the Order Paper to-day every one of which would require an additional expenditure which would have to be met in the only place in which it can be met and in the only place where the money is, and that is from the producers of the country. There is no other place from which the money can be got. Deputy McGilligan tells us of our decaying taxable capacity, but he does not show us any proof of it, nor does he face the fact that every single known index—and again I am asking the House to give us another index—by which, in the ordinary way, the prosperity of a country is judged, is pointing, in the Free State at the present moment, in one direction.
I will give an actual experience. That statement was made at the Incorporated Chamber of Commerce and Shipping in Cork last year. Various people, bankers, merchants and the rest got up and told us about mysterious things of they knew which would appal us. Of the secret things that were hidden behind the scenes in any of these indices, we asked each and every one for proof, or to tell us the horrible secrets that were crawling away in the shadows behind them, that showed that this country was going to the dogs, in spite of all the recognised indices, and not one single iota of new information was got from such inquiries. For two years I have been deliberately looking for the bare points in this transaction. I have gone to all sorts of people. I said that what I wanted was not the good cases, but the bad cases, and to give figures and facts which they said we did not know,  which controverted all the indications that we do know. Nothing has come out yet to contradict the broad and general indication. One thing I approved of in every speech made— and I hope it will be the burden of the speeches at by-elections—and that is that we are up against it. If we are going to have large schemes of any sort, kind or description, either of a capital character or of an income character, for the benefit of the people they have got to be paid for.
Mr. Flinn: By whomsoever has the money. I agree with that unhesitatingly. I go this far, that I define the taxable capacity of a country as that amount of the total income, over the income required for sustenance of a population, which could be turned to more useful purposes in the development of the life, the prosperity and the industry of the people itself. I do not hesitate at all about that. But it does not help me to say that you can get it all from certain sources. I think a list has been read which represents £8,000,000 or £10,000,000 worth of stuff which Deputies opposite have recommended this session. They want to get rid of the whole of the annuities, and the whole of the rates; they want to have a couple of millions spent on telephones, and someone wanted £250,000 yearly spent on increased wages in the Post Office. All sorts of things were spoken of. Deputy Davin asked me whether we were doing all the public health works that we should like to do. We are not.
Mr. Flinn: Because things have to take their turn. I want to help in the matter. We estimate that to tackle the sanitary problems in the Free State as a whole would cost at least £6,000,000. If that is put into the Budget Deputy MacDermot will not let us borrow for it. If we take the interest on it then it has to be raised by taxation, as well as the sinking fund. But if we did £6,000,000 worth of sanitary work, who is going to tell us that the House is going to accept that as  the only thing that is going to be done, or that that work is to get priority?
Mr. Flinn: Yes, it is altogether better if it does not cost you anything more. I want to see them employed. I want to see every man off that dole. I want to see every man who is getting the dole working for every penny of it, and I want to see added to the amount he is getting as a dole an amount of money which will make it worth his while to work. All that cannot be done in a day. As to the extent to which it is done, it means that the Budget is going to be increased; it means that taxes are going to be increased, not to-day, to-morrow, but every other day, and it is a question when and how that can be done. It is a question of the Minister for Finance surveying the whole problem, and asking whether or not the country is being submitted to a greater strain than it can bear. There are people who think it is, and there are people who think it might go much further.
There was one portion of the speech of Deputy O'Sullivan with which I agreed, and which I think was a useful contribution, not merely to this Budget debate, but to the whole question of economic considerations here. He said that there were taxes borne by people which did not appear in a Budget. There always have been. I think all those taxes should be segregated so that we would know what they are. I believe in putting the people up against facts. They have the courage to face facts. As far as is humanly possible, these taxes should be put in in some form in the national balance sheet. We know that our predecessors did not put their taxes into the Budget. Oh, no. They were very careful about that. For instance, they wanted to have an unemployment scheme. A general election was coming, but they were thrown out before they paid for that scheme. They said: “We will give £250,000 as an election bribe, but nominally in the form of unemployment relief.” They did not make any attempt, such as we are making, to see that the money  went to the people who required it, or to the places that required it at the time it was required. In one case there were ten gangers, every one of whom was a personation agent of one particular Party. At any rate they decided to give £250,000. How did they do it? They said: “The British owe us £250,000, which they will perhaps pay. They owe that to the Road Fund, so we will take the £250,000 out of that Fund.” The British have not paid that money since. That Party went out and the present Minister for Finance had to find the money in his first Budget. Then, of course, they would not raise income tax. Oh, no. Such a thing as putting on three extra sixpences was too horrible for words. They would not increase the seven sixpences. What they did was to collect 18 months' income tax in one year. That avoided having to raise the rates in any way.
Then, at a critical moment, the question came up again of finding some new money for the Budget. Of course they would not put any more taxes on beer and stout and whiskey. These were the food of the poor. Oh, no. What they did was to call in an extra two months of the brewers' credit, and to put the £250,000, more or less, into their pockets without any trouble. But it did not raise the taxes.
There are other secret methods of taxing. They have the selling of assets. They have the calling of it “miscellaneous revenue.” The old Congested Districts Board, the only good Board that the British had out of something like 54 Boards, the one Board that was abolished, the one that I hope to see set up again had some assets. They had something like £900,000 accumulated funds during the War. That was money which had not been spent by them during that time. Where are these funds? Miscellaneous revenue. The education authority had some stocks, the interest on which to-day should be used for the purpose of relieving this Budget and preventing us putting a tax on tobacco, sugar, tea, entertainments and other things which are only consumed by the widow and orphan. Where is all that stuff? Miscellaneous revenue! As Deputy O'Sullivan said  very rightly, very pregnantly and very truly, “all the taxes that the people pay do not appear in the Financial Statement.” But here is the amazing thing. This is the complaint that he makes against this criminal here, the Minister for Finance. He said “the Minister had openly and shamelessly imposed taxation,” instead of calling it miscellaneous revenue. That is the accusation. That is the accusation against this poor innocent, that he openly and shamelessly imposed taxation; he openly and courageously faced the people of this country, called upon their courage, called upon their sense of responsibility, called upon their sense of realities and said: “These are the things which we as your Government were under your orders sent to do, and for these you shall pay.”
Mr. Flinn: Damn good. There are people who think that the only person who pays income tax is the man from whom the income tax is collected. Why did the Dublin Chamber of Commerce turn down the “No income tax” campaign?
Mr. Flinn: Why did Deputy Good turn down the “No income tax” campaign? If they believed that income tax was paid only by the people from whom it is collected why did they turn down the campaign? It is the old game. It is about time it was exploded. There is a book of Victor Hugo's called Les Miserables and in that book he says that the whole object of the tax collector is to collect the money with as little conscious disturbance and trouble as possible to the people from whom he gets it. He wants the money and he is  going to get the money, but the whole object of any taxing system is to get it out of the people with the least possible resistance. One of the very beautiful games that has been worked, and worked very successfully, is that of persuading people that in relation to taxation they are divided into two classes, the first, the people who pay direct taxes and the other the people who pay indirect taxes. It worked beautifully. I am calling Deputy Davin now as a witness. It worked perfectly. Deputy Good, according to Deputy Davin, is perfectly satisfied as long as the money is raised by indirect taxation; and Deputy Davin is perfectly satisfied so long as it is raised by direct taxation such as income tax.
Mr. Flinn: It is a great stunt. These two classes have been persuaded that these taxes do not cross the line. I am perfectly satisfied they do cross the line. For that reason it is to me purely and simply a matter of machinery and convenience how the money is raised. The people who pay large sums in income tax know how to get these moneys back. They know how to pass the burden on. Deputy Davin knows that the one argument which we put forward at that particular time was that the income tax was passed on. The Dublin Chamber of Commerce, knowing that the purpose of that campaign was to put up differential taxation, greatly to its credit, the one Chamber that saw through it, turned down the “No income tax” campaign because the “No income tax” campaign was then the only instrument in the then state of governmental authority which was capable of wrecking all that the Dublin Chamber of Commerce stood for—a country of distributors instead of a country of producers. All the things that the “No income tax” campaign stood for are being done to-day by tariffs, quotas and the rest of it by the whole authority of this Government because the whole object of that was to turn this country into a producing instead of into a merely distributing machine.
 In the course of this debate Deputy Mulcahy came along and made the most extraordinary statement. The Deputy said: “It is not the faintest use pretending that the people of this country are getting on well because they are not paying as much for boots as they did.” Even though it was proved to him that they were consuming more boots he went on to complain that they were getting too many boots for too little money. That was his complaint. Apart from that, I do not think he said anything.
Deputy Roddy made a contribution whose courage I think ought to be commended. I believe my friend Deputy Corry said he would put that speech in his Bible. It all depends on how far Deputy Roddy is prepared to go on the road which he has blazed for himself. On that depends whether that was the most discreditable speech which was delivered in the House or a speech which was greatly to the credit of the Deputy. Deputy Roddy said quite frankly: “I believe there are altogether too many social services in this country; they are altogether too costly; they are more than we can afford; we ought not to have them at the rate at which we are now having them.” It takes a good deal of courage to say that, be it right or wrong. I remember the case of the Deputy in this House who, when we were discussing the 24/- a week wage for relief schemes, said: “I disagree with it; I did not know that that was the wage, or I would not have asked for them. Now that I do know the wage, I will never ask for them again.” That Deputy never did. His constituency did not lose anything by it, because they were carried out there. But there was a man who had the courage of his convictions and stood over them, and I have the greatest possible respect for him.
In the same way, if Deputy Roddy does believe what he is saying, and if he is prepared to implement it in the Division Lobby, whether we will agree with him or disagree in the correctness of his conclusion, we will honour him at any rate as a man. If he says: “I do not believe we can afford these  things; I do not believe we ought to have them; I think they are going too quickly,” and if he then goes into the Division Lobby and votes against their extension, then that man has the same courage that I have commended in a member of a Party here who did not just say a thing and then run away from the consequences. If Deputy Roddy is going to follow the example of the rest of his Party and, while defaming those who have the obligation of collecting the money, votes against every source from which that money comes, is going to go into the Lobby and vote for old age pensions, and vote for widows' and orphans' pensions, and vote for the extension of this and the extension of that while denouncing them, then I say the speech of Deputy Roddy is as discreditable to him as it might be honourable and that the choice rests with him.
I could go through the whole of the litany of defeatism and disaster, the litany of complaint we have had here, the litany which Deputy McGilligan has described as the usual skirmish, but I will not. I do, however, repeat the appeal which has been made, an appeal which I made to the Chambers of Commerce and they ran away from it, and that is: “If you object to taxation come and tell us what we are spending it on that you do not want done, and if you want the thing done, and if you object to the particular way in which we are raising the money, then tell us where you are going to put the burden and come and agree on it.” The imposition of taxation is not at all a nice or pleasant thing. It is a duty and it has got to be done. It is a duty which will be done, but it would be a duty which could be much more easily and much more fruitfully done if, behind the imposition of taxation, there was agreement as to the sources from which that taxation should come.
I have never yet addressed an audience in which I did not believe that every man in it was as intelligent as myself, and that practically every man knew a great deal more about some things than I knew. I believe in treating my own constituents as respectable and intelligent people, and I do not pretend to think that I can fool or deceive  them. Deputies opposite cannot fool the people by objecting to taxation and demanding the fruits of taxation. They will not do themselves the slightest bit of harm from an electoral point of view if they will share the burden of acknowledging and accepting the sources from which the money comes while demanding the thing itself. It was I used the phrase here once as a slogan of Fianna Fáil in relation to finance: “Nothing popular in finance.” Getting money from people is not going to be popular. Getting money from the people who ought to pay it is not going to be popular. Doing work and telling them that they have to pay for it, is not going to be popular, but it is honest. That is what the Budget has done, and for that reason we stand over it.
Mr. V. Rice: As a representative of a constituency in this country which has the greatest number of poor in it, I listened last Wednesday with considerable indignation to the speech of the Minister in introducing his Budget, but I must confess that I have listened now to the speech of his satellite who has just sat down with considerably more indignation. Deputy Flinn has told us that everybody should bear the burden of taxation, and why should not the working classes and the poor stand the burden of taxation as well as others? Has anybody suggested that the working people and the poor should not stand their due share of taxation? I did not hear Deputy Davin to-night, or Deputy Norton, who spoke last week, suggest that the working people and the poor people should not stand their due share of taxation. Deputy Flinn appears to think that when he pays 4d. per lb. extra for his tea he is bearing the same burden as the poor miserable people on whom a tax of 4d. per lb. is imposed on their tea. He seems to think he is bearing his fair share of taxation when a ¼d. per lb. is put on his sugar; that he is bearing the same burden as the working man who is supporting his family when he has to pay an extra tax on his sugar. I have seen various calculations as to what this extra taxation means on the poor. I have seen it suggested that it means 1/6 or 2/- per individual on the poor.
Mr. Rice: I saw a statement made by a representative of the Postal Union that it represents about 1/6 per head. I do not accept these figures, because I have not analysed them, but I do suggest that the burden on each individual poor person who is paying this extra taxation will be a very considerable one. It will not mean ¼d. per £100 on Deputy Flinn, but it may mean 1/- per week on the £ that the workman earns. Does Deputy Flinn seriously suggest that the poor are only bearing their proper proportion of this new taxation when this extra tax is put on their food? I remember the indignation of the Fianna Fáil Party about taxes being put on the poor when Deputy Cosgrave was President. Deputy Cosgrave's Government was called a Capitalist Government, but in those days the breakfast table of the people at least was free. Now, as a result of the beneficent Government we have got from the Party opposite, we have a £1,000,000 a year taxation paid on the butter consumed by the people of this country, and most of the people who pay that tax are the poor.
Mr. Rice: We have this tax renewed on tea, and as a result of the new taxation the price of sugar is increased by more than 50 per cent. over what it was then. We have a new tax on tobacco, a commodity which I suggest is also a necessity of the poor. We have a new tax on bread. All the necessaries of the poor are taxed by the Party who were going to reduce taxation in this country by £2,000,000 a year. We were told to-night by the Minister for Education that the Minister for Finance will reduce taxation when he gets an opportunity of doing so. A promise to reduce taxation in the future should be valued from this point of view: who made it? It is made by a Party and by a Government who, before they came into office, told  us they were going to reduce taxation by £2,000,000 a year. We have now before us a Budget which shows not only no reduction of £2,000,000 a year but an increase of taxation by many millions of pounds, and yet a Minister on those benches has had the effrontery to get up in this House to-night and tell us that the Minister for Finance will reduce taxation when he is able to do so.
Deputy Flinn told the House to-night that this Budget has brought the people up against facts. It has. It has brought the poor people up against the fact that they are having an ass's burden put on their backs by this Government which posed as the friends of the poor before they came into office; this Government which said that the Cosgrave Government supported only the capitalists and the rich. The poor people are brought up against the fact that an ass's burden is being placed on their backs by the Fianna Fáil Government. There is a tax of 4d. per lb. on tea; there is an extra tax on their sugar; the tax on their butter is maintained. All this is done by those savers of the poor who got into office by promises to reduce taxation, to reduce the cost of living, and to make this a country in which the poor would be a happy people. Not only was there to be no unemployment—they were to bring 84,605 extra people into employment—but in addition to that our industries would be so prosperous and our country would be so happy that we would have to send to America and bring back people to fill all the jobs we would have here to give them. The Minister for Industry and Commerce remembers all about that speech. Those were the promises made. Deputy Flinn, the man who was going to make this country happy by the abolition of income tax, has had the effrontery to get up in this House to-night and say: “Why should not the working classes bear their share of the taxes?” Who ever claimed in this House, on the Labour Benches or on those benches, that the working people should not pay their due share of taxation? Nobody ever suggested that they should not,  but I would suggest that when you put a farthing on the sugar for the working people, or when you put 4d. on their tea you are imposing a far bigger tax on them than if you put 1/- in the £ on Mr. Hugo Flinn's income tax.
Mr. McGovern: I have been listening to this discussion on the Budget for a couple of days, and I think I can truthfully say that not a single word has been said in favour of it from that side of the House. Everybody who has spoken from the Government Benches has been making a sort of apology for the Government, and asking the Opposition to show them how to balance the Budget or how to make it a more popular Budget. That is not the business of the Opposition at all. It is the business of the Government themselves to implement their own promises, and not to ask the Opposition to show them how those promises should be implemented. When they made those promises to the electorate they did not say that it would depend on the Opposition to show them how they could be carried out, but now they come pleading to the Opposition to show them how it can be done. I would ask the Executive Council whether they are prepared to carry them out if the Opposition shows them how it can be done. That is the first condition I would impose on the Government—that they should sign an undertaking that they will carry them out. The Opposition will then show them how to implement their own promises.
I must admit that the Minister for Finance had a painful duty to perform in bringing this Budget before the House. It was a painful duty, and his humorous remarks in introducing it were as much out of place as if the judge, on putting the black cap on his head to deliver sentence, began to amuse his prisoner. When the Minister had this painful duty of delivering the Budget sentence on his own victims  it would have been more suitable to put on the black cap rather than try to introduce humour into it. His attempt to make it a smiling Budget was an absolute failure. I had an opportunity of viewing the faces on all sides of the House, as well as in the gallery, and I did not see a smile on any face except that of the Minister himself. There were no smiles on the faces of those on his own benches. They did not feel it was a smiling Budget, but after all there is something to be said for it; it is bringing home to the majority of the people who were misled by those promises that now they have got to pay for their own folly. Deputy Davin and the Labour Party, who were prepared to indulge in the luxury of an economic war and all the other nonsense which Fianna Fáil has introduced, were prepared to indulge in it at the expense of others. They did not mind what sacrifies had to be made; they did not mind sacrificing the farmers of the country so long as it did not touch themselves, but sooner or later it had to come home to all Parties. Everybody in the State will eventually feel the pinch, but the poor people will feel it worse in the long run. It is impossible to keep taking it all the time off the farmers. The burden must be borne by all classes sooner or later, and this is only a short step in that direction. The Budget, of course, notwithstanding all that has been said about it, is not balanced because the Minister for Finance knows that it is not sound finance to borrow a couple of million pounds to pay bounties. If bounties were an abnormal condition of things, if they were only a passing phase of government activity, I admit that there might be some justification. In 1934, in referring to them, the Minister said that this thing could not go on for ever, and because it could not go on for ever he felt he was justified in borrowing for bounties. Can the Minister say if we are any nearer to normal relations between this country and Great Britain? Are we any nearer to the position when there will not be a necessity for these bounties? The Minister did not hold out the same hope to-day as he did 12 months ago. So far as the Government are concerned,  they apparently regard the present condition as normal and they look upon the economic war as a normal relationship between this country and Britain. I contend that the Minister is not justified in borrowing for the payment of bounties, necessary as these bounties are. If he goes on year after year borrowing to pay them back, where will it all end? What prospect has the Minister in view that will place the country in a better position in the years to come in relation to these bounties? The same thing might be said with regard to borrowing for building purposes. There is a case for borrowing for some projects, but it is not sound finance to borrow for all the things the Government seem to have in mind. This money, it must be remembered, is being expended to relieve the unemployment which has been brought about, partly by the Government's policy and partly by the increase in population.
It is quite probable the increase in population will continue and the necessity for providing money to relieve unemployment will continue in the future so far as we can see, and the Government can hardly submit that it is sound finance to keep borrowing year after year to provide work for unemployed people. It all resolves itself down to this, what are to be the normal conditions and when are we likely to reach those normal conditions when the Minister for Finance will be in a position to balance his Budget and when the country will be able to provide employment for all its people? The necessity for these bounties is due to the economic war. The country cannot be deprived of £20,000,000 through the decrease in the value of our exports without every section of the community feeling it. This Budget is only a beginning. Anyone who looks into the future must realise that this Budget is merely the opening stage of what we are likely to have in future years. The ability of the people to bear further taxation is diminishing every day. As taxation goes up, the ability of the people to meet it goes down and that condition of things is bound to continue while this Government pursues the foolish policy upon which it has  embarked. The Parliamentary Secretary to the Minister for Finance, the Minister for Agriculture and the Minister for Industry and Commerce invariably ask the Opposition to show them the way to implement their policy.
Mr. Flinn: We have merely asked them to show us an alternative. We would not be entitled to ask them to show us the way, but if they object to our methods we are entitled to ask them to show us an alternative.
Mr. McGovern: We have shown you the way many times. One of your promises at the last election was that as a Government you would cut down the number of officials. Have the officials been cut down in numbers? Have they not rather been increased in number? How have your promises been kept? Is that the way to implement the promises you made at the election? Every speaker on the Govenrnment side tells us: “No matter what we have done, the people have sent us back.” They sent you back in the belief that you would keep your promises, that you would cut down taxation and reduce the number of officials. Is not that the issue on which you were returned? Instead of reducing taxation by £2,000,000 it has been increased by about £8,000,000, and there are still a couple of millions being borrowed. Posterity as well as the present generation will have to pay for the folly of this Government. We have taxation on tea, on sugar, on tobacco, bread and on everything else.
Mr. McGovern: I am glad to be reminded about butter. We are, as a matter of fact, paying a tax on butter. The people in the Free State are paying 6d. per lb. more for butter than the people across the Border.
Mr. McGovern: I agree it was necessary in the circumstances. I want any Deputy over there to tell us what advantage it is to this country to have the people paying more for their butter  than people pay elsewhere? When the farmers are selling their milk at the creamery they get 4d. per gallon, while people across the Border who buy their butter at 50 per cent. less are selling their milk to their own creameries at 50 per cent. more than the Free State farmers get. Does any Fianna Fáil Deputy deny that? The Minister for Agriculture had to admit that the price in Northern Ireland for milk supplied to the creameries is 6d. per gallon. He mentioned that that was the winter price. Whether it is winter or not now, that is the prevailing price. The average price paid during the last month was 4.12d., but the Minister in the Northern Government paid the balance of 1.88d. in order to bring the price to 6d. a gallon. We are told that the price is to be reduced to 5d. for the summer months, and I am not going to question that statement. That means that the average price will be 5½d. in Northern Ireland, while the average price here is 4d. It is a little under 4d., with all respect to the Minister for Agriculture. The “advantage” we in the country are getting because the people of Dublin and other towns throughout the Free State are paying extra for their butter is that we have to sell our milk at 1½d. per gallon less than the farmers in Northern Ireland, where they can buy our butter at 6d. a lb. less than the price here. I challenge anyone to contradict those figures.
We were told that people were better off here in every respect, with the exception of cattle. No one has pretended that the price for cattle here is as good as the price in the North of Ireland. In fact they are £6 a head less. The Minister told us that the money received for milk and butter paid the farmers for everything, but I have shown the actual facts in that respect. The small farmers and even labourers go in for poultry rearing and egg production. The price of eggs here is about 5d. per dozen. The price of hen eggs in Northern Ireland is 8d. per lb. and eight eggs make a lb. As in the case of milk, the Northern farmers are getting 50 per cent. more for their eggs than farmers in the Free State and yet Fianna Fáil speakers will tell  us that we are losing only on the cattle. We are losing not only on cattle but we are losing to the extent of 50 per cent. on eggs and milk. Let us turn now to pork and pig carcases. The average price in the Free State of pig carcases —and I have the figures in the Farmers' Gazette and other papers—is 47/- per cwt. The price the producer gets for his pigs is 47/- per cwt. dead weight and the average price in Northern Ireland is 61/-. That is the price the farmer gets on the scales and he need not be concerned about the price of bacon afterwards.
That is the position with regard to eggs, pigs and milk as well as cattle. We are told about the price of oats but what does the price of oats or barley matter? Oats and barley are only raw materials in agricultural production for feeding to pigs and fowl. We have no market across the water or anywhere else for our oats and if one farmer gets a good price for his oats, he must get it from his neighbour who is feeding pigs or fowl. You cannot call it any advantage if one farmer gets a good price at the expense of his neighbour.
Mr. McGovern: The position in connection with the production of pork, eggs and these other commodities is that they have to pay more for feeding stuffs in the Free State than in Northern Ireland, and Deputy Donnelly knows that perfectly well. They have to pay more for clothes and boots. For everything they have to buy they have to pay more, and they have to lose 50 per cent. on everything they sell, and all the logic of Fianna Fáil cannot alter one of these facts. There these facts stand, after all is said and done. If Deputies will go down to the Library they will see these facts and figures, and I challenge them to deny them. I will bring the figures in and quote them if any Deputy questions them.
All this talk is only nonsense. There is no use trying to camouflage the situation, and there is no use trying to confuse the public mind, because the public mind is beginning to be aroused,  and this Budget is the first thing that brings it home to the people that they have to pay for their folly and that they cannot indulge in economic wars and such nonsense at the expense of other people. They have to pay for such things, and that is the one good thing I see in the Budget. The Minister for Finance at the time of the 1933 election, told us that the economic war was already won. How is it that we are still paying for it now? He also told us in 1933, when he introduced his Budget, that he had saved £92,000,000 or £94,000,000 to this country. If he saved that money, how is it that the Minister in England can say that he is collecting it still? He may have saved it for the Exchequer, but he has not saved it for the country. He has thrown it upon the farmers, and he has run away from his responsibilities. He has relieved the Exchequer perhaps of the load of paying that debt, but he has not relieved his conscience of the responsibility for throwing it upon those who were not liable to pay it, exacting that money in another direction and throwing farmers into gaol when they refuse to pay it the second time.
I think the Government will have to relieve their own conscience before they can say they have cleared this debt. It is a debt we are paying, and paying not only once but three times over. We have paid the entire annuities to Britain, and we have other debts amounting to a couple of million pounds—local loans and charges in connection with the payment of R.I.C. pensions—and all these things are borne by the farmer, if the Minister has relieved the Exchequer. We are losing, at the same time, the good will in the British market, which the President told us was gone forever, thank God. He was very glad to make a settlement and to give Britain a monopoly in respect of coal in return for taking a certain number of our cattle into that market that was gone forever. No matter how long this Budget is discussed, we have to get down to the root cause of the trouble. Deputy Flinn asked the Opposition to show how anything better could be  done and how the economic war could be settled. One thing that I will say is that the position could not be any worse since we are paying the whole amount which Britain claims and losing a thousand other advantages in the British market and having quotas and everything else imposed into the bargain. We could not be any worse if we were to pay the whole thing. I do not say that we should pay the whole amount nor that it is necessary to pay the whole amount.
Mr. McGovern: I am not going to say whether this money is due or not, but we have as good a case for a settlement as Britain has for a settlement with America. We have as good a case as France, Germany, Italy or any other country in Europe has for being relieved of their debts to England, and I think the Government should not be afraid to enter into negotiations with British statesmen who are themselves negotiating for a settlement of their own debts. The Government is suffering from an inferiority complex. Otherwise, they would not be afraid to meet British statesmen face to face. They have a good case but they are running away from their responsibilities. They are throwing the responsibility on the unfortunate farmers and throwing them into gaol instead of going like men to meet British statesmen and putting the position before them.
Mr. McGovern: I should like to remind Deputy Flinn that after the Ottawa Conference, when the statesmen  of the different countries of the Commonwealth met, every one of them came home with a good settlement for his country. They improved their trade positions and they got good settlements except our representatives. What did our representatives get at the Ottawa Conference? If the Minister for Industry and Commerce will study the statisties supplied by his own Department, he will see that the exports from this country to all the countries of the Commonwealth have gone down at an alarming rate, while the trade between all the other countries has improved. Why did this country send representatives to that Ottawa Conference at all if that was the result? I think it was a terrible mistake to throw away the hard-earned money of the taxpayers of this country in sending representatives to that Conference when they could bring nothing back.
The Minister has tried to make the Budget as little felt as possible and tried to make the country believe that, although they are paying something like £36,000,000 in taxation—if they are not paying it in full at present they will have to pay it in the future—they are not paying much taxation at all. He reminds me of certain dentists who used to go around extracting teeth. They brought a band with them and kept the band playing. When the unfortunate patient was undergoing the operation, nobody felt any pain. They were all amused except the patient and, with the noise of the band, nobody heard his moans.
Mr. McGovern: They called that painless extraction. However the Minister may pretend that nobody is suffering by this taxation, the fact remains that everybody in the State is paying. They pay when they go in to buy shoes, cloths, butter, sugar, tea or eggs. They pay it across the counter. The Minister is getting the money and they are paying it, no matter how they feel it. They may  blame the shopkeeper because they think he is charging them too much for tea, tobacco or sugar. The Minister, however, is making everybody in the State his tax collector, so that the people may not believe he is collecting the tax at all. The levy upon butter and all the other charges are going into the Minister's Budget and yet he is not able to balance it, because when the State is deprived of its annual income, it must come out of the pockets of the people. These taxes are not being paid out of income; they are being paid out of capital. The result is shown in the bank returns. The “Economist” has shown very clearly how the assets of the banks are affected this year as compared with a year ago. These have gone down in one year by £17,000,000. The effect of the first two years of Fianna Fáil Government were not felt. It is only now that the effects of the Fianna Fáil policy are being felt. It is necessary that any policy should be in operation for some time before its effects become evident. For the next 20 years, the effects of the policy of the present Government will be felt. For many years, there will be difficulty in getting this country on its feet again. I do not believe that any Party man can bring the country right. It will be necessary that all Parties co-operate and try to pull the country out of its difficulties. That is my opinion.
The Minister for Industry and Commerce asked for the co-operation of all Parties in this House. I am quite sure that he can have that co-operation in any business proposition he puts up—whether the conversion of the first National Loan into a new loan or any other proposition. But if the Government want the co-operation of the House, they must get real co-operation if it is to be of any use. For that reason, they should not put up a foolish policy to the Opposition and expect the Opposition to assist them in that policy. The Opposition do not believe in the policy of the present Government. They cannot be expected to fall in behind the Government and assist in giving effect to Fianna Fáil policy when they know in their hearts that that policy is  wrong. We have been told that the English people set an example in co-operation. What did the English people do? They formed a National Government. In that National Government, the Opposition joined in order to pull the country out of its difficulties. The English people set an example which this country might well follow. Are the Government here prepared to do the same thing and are they prepared to have an agreed policy? If they were prepared to take the Opposition into their confidence and have an agreed policy, I am sure that the Opposition—I am speaking merely my own mind— would not be found wanting. It remains to be seen what the present Government really want when they speak of co-operation. Anybody who has the interest of the country at heart will be only too glad to help the Government out of the difficulties in which they find themselves. There is no question that they are in difficulties. Every day, they are getting into deeper water and, eventually, the country will be in such a position that no Party will be able to extricate it. The surest means by which the country can be relieved is by the genuine co-operation of all Parties. There is hardly any other way out of the situation and the sooner all Parties realise that the better.
We heard some remarks about the adverse trade balance but we do not know exactly what view the Government take with regard to this adverse trade balance. When they were in Opposition, an adverse trade balance of about £13,000,000 was regarded as very serious. Now that it has gone up to about £20,000,000 and is still increasing, it is of no consequence at all. When we had an export trade of about double what it is to-day, an adverse trade balance of £13,000,000 was very serious. When our export trade has been halved, an adverse trade balance of £20,000,000 has no significance. That is Fianna Fáil logic. The Minister for Industry and Commerce made a very poor defence of this Budget. He was driven into a very tight corner when he had to charge the Opposition with things of which they were never  guilty. In trying to make a case for the Budget, he charged the Opposition with voting against the Unemployment Assistance Bill but it was proven that, in that, he was wrong. He is not very particular in his figures, either. He arranges them to suit his own purpose and they would no more stand investigation than his statement with regard to the Opposition voting against the Unemployment Assistance Bill. The only defence that the Minister for Industry and Commerce, the Minister for Agriculture or any other speaker on the Government benches had for this Budget was to ask the Opposition to show them how to carry out their own promises. It is the business of the Government and not of the Opposition to find a means of implementing their own promises.
The President: I have been in some doubt as to whether there was need of any further speeches from this side of the House. When I was in Opposition, I always felt a certain amount of sympathy with the Minister for Finance on occasions like this. I used to think that it was rather unfair that the Opposition should be free during the greater part of the year—practically all the time—to advise expenditure in directions that might be popular without having any real responsibility for facing the cost when the time came. When it fell to the lot of the Minister for Finance to raise revenue to meet the expenditure, I used to think the position was hardly fair to him. Having sat here during the afternoon and having listened to some of the speeches from the opposite benches, I am inclined to think that my sympathy was altogether misplaced. At no time, in my opinion, does the Opposition show itself to the people in a more unfavourable light than it does on occasions such as this. The representatives of each section of the community cry out against their section bearing any part of the burden which they were so ready to suggest should be imposed.
Anybody listening to the arguments  put forward by these representatives on behalf of the different sections, must come to the conclusion that there can be no real sincerity behind their criticisms. In fact, very often they appear to be absolutely ridiculous. They bring themselves to the position that was exposed by the Minister for Agriculture to-day when he pointed out that there were demands from the opposite benches for schemes which would involve the raising of several million pounds: that these demands had been but recently made, and that if they had been accepted by the Government they would involve not merely taxation on the present scale, but taxation on a vastly increased scale; or they would lead in such directions as we heard from Deputy Davin this afternoon. The Deputy, on behalf of the Labour Party, tried to suggest that a needless burden was being placed on the poorest sections of the community, and said that the means to provide for these services could have easily been obtained from other sources. I sat here during the course of the Deputy's speech, and I noted points to which replies could be more easily made than I think I have ever heard from any speaker in the House.
The bounties, we were told, were not going to the farmers, and it was said that they should be replaced by derating. I should like to hear some of the gentlemen on the opposite benches if we came in and proposed that there should be no bounties this year. I should like, for instance, to hear Deputy McGovern on that. The Department concerned is examining that whole matter most carefully, and they are perfectly satisfied that the bounties as regards eggs, poultry, butter, bacon, live pigs and horses do go to the farmers.
The President: Live stock is but a small fraction of the whole. I think it is only about 20 per cent. There is a question with regard to live stock, a question that has arisen mainly on account of the operation of the quotas. That matter is under consideration, and actually at the moment, apart from what action may be taken by the  British with regard to the quotas, the Department is engaged on the preparation of a Bill the purpose of which is to amend the Slaughter of Animals Act.
Now, let me come to the suggestion of derating instead. I think I should deal with this question of derating, because it is just as well that we should have it out. When the land annuities were being paid over to Britain I told the people that if these annuities were retained here, as we intended if we got into office to retain them, a sum of at least £2,000,000 would go back to the agricultural community, and when we came into office we had to decide whether that money should go in the way of derating or not. We decided deliberately that it was better for the farmers generally that it should go in the halving of the annuities than in derating. I, for one, am opposed to further derating, and for this reason: that if we are going to have local government at all we cannot relieve the rates to any further extent. Already the sum that is being paid from the central Exchequer to meet local charges is so great that, if we give any more, we will have to give up local government and take away from the people the responsibility of spending unless they have the responsibility for providing the money that is spent. Therefore, on this matter of derating we have to make up our minds on this: do we want local government or do we not? If we do not want local government; if we do not want the people to have responsibility for their own local services, then we can cetralise and meet the whole cost from the central Exchequer. But if we do want local government, if we want the people to have local responsibility we cannot meet the cost of local services to any further extent from the central Exchequer. That is definite. By the reduction of the annuities to one half, we have given to the agricultural community——
The President: I was saying that we promised that if we got the annuities we would make available out of these moneys about £2,000,000—the sum was specified—for the agricultural community, and that was done. It was one of our first acts. We made the deliberate choice of doing that as against derating, and I say that there will be no further derating. That is definite as far as this Government is concerned. There will be no further derating if we are going to continue local government. If the people are going to have local services, then they must have the responsibility locally of providing the money for these services and at present a very substantial proportion of the local charges is being met by the central Government. So much then for the first point about derating. Derating was not, I should point out, suggested by Deputy Davin by way of addition, because if it were then the money would have to be got here, and it is not the present sum that would have to be provided for derating, but a further sum of money would be necessary. Deputy Davin suggested it by way of substitution for the giving of the bounties which, he said, did not go to the farmers.
The President: I think the expression the Deputy used was “bounties.” If the Deputy wishes to correct himself I say all right. As I have said, the cattle bounties represent only  20 per cent. of all the bounties and that matter, as I have said, is being examined. It is admitted that there is a question as to whether all the bounty in the case of cattle does go back to the farmer.
The President: Very well, I accept that. I say again that it only represents about 20 per cent. of all the bounties. That matter is under consideration. So far, there is an admission on the part of the Department that it is possible that all the bounty does not go back to the producers. The matter is under consideration and an amending Bill is in course of preparation. We were told that another source that ought to be taxed so as to relieve the poor of their burden was the ground landlord. One of the Financials Resolutions—Resolution No. 6— deals with that very matter. The practice has been, in the case of builders of houses, to estimate their income on the capitalised value of the ground. It is considered that that is getting after them to the extent that it is possible, at any rate at the moment. Therefore, any suggestion that they are not being taxed, and taxed heavily, is not right.
The President: I have said that in estimating the profits of house builders, their income—the reserved portion of the rent which they get—is estimated not at its simple value but at its capitalised value. Therefore, there is a heavy tax on them. It has been suggested that we might put a tax on motor cars.
The President: Very well. The users of private motor cars at the moment are paying a very heavy tax on the petrol—8d. per gallon. There  is a very big question whether, if you increase the rate of tax, you will increase the total yield, and that is a matter that is carefully considered by the Minister for Finance when he is framing his Budget. In addition, there is the tax for the Road Fund— according to horse-power or whatever way it is calculated—which is also a substantial annual sum on the users of motor cars. Therefore, it is a mistake to say that the section of the community which uses motor cars are not taxed. They are, and the only consideration is whether, if the Minister increases the tax, he will have a greater total yield. These are all the points made by Deputy Davin, I think.
We have been asked why it is that the grants for the local schemes which the Minister for Finance and, I think, the Minister for Local Government and Public Health, said were available, were not being availed of. I have made inquiries and I am satisfied that, in so far as it is possible for the central authorities to drive the local authorities to do this work, they are doing it. If there have been delays it is due to the fact that the local authorities have not put up schemes or are not prepared to bear their share of the amount these schemes would cost. As far as the central Government is concerned, the Minister for Local Government and Public Health would be only too glad if the local authorities would accept his suggestions in this matter, and then these schemes would go ahead much more rapidly.
The President: I have been talking, not half an hour ago, to the responsible Minister for that, and he has no complaint about the Department of Finance in the matter. His complaint is that the local authorities are not able to co-operate rapidly and quickly enough with the central authorities.
The President: Deputies have all got their opportunity, for the last two or three days, to make their speeches, and I think I should be allowed to make my speech. I shall answer questions at the end. I have here a note of what was said about the Guarantee Fund by some Deputy. A question was asked: Could not some Department use its imagination and get some way by which those who paid their rates would not have the burden imposed upon them of meeting annuities for those who have not paid them? The Deputy who made that remark said that I smiled when he said it. I said to the Deputy—I think it was Deputy Davin—that he should use his own imagination on the matter and give us the fruits of it. Unfortunately there is no scheme, that we can see anyhow, to remedy that matter, and if any Deputy here can devise one, we should be very glad to put it into operation. If a person is unable to pay, the putting of increased rates on him is not going to make him pay, and the only way payment can be guaranteed is the way in which it is at present guaranteed. Undoubtedly, it puts a burden on other people, but we have that kind of thing constantly occurring. In every community some of the drones have to be brought along, and other people have to take the share of the burden that the drones will not bear. Some Deputy spoke about the Volunteer Force. I do not know whether it was Deputy Davin or not.
The President: Well, Deputy Davin spoke about the income tax. I shall come to the question of the Volunteer Force later on. We were asked: Why do we not increase the income tax? Deputy Hugo Flinn asked Deputy MacDermot why he did not come along with his suggestion, as he had already indicated a reason, and a very good reason, why the income tax, in the circumstances, should not be increased.  The Deputies on the opposite benches know very well what would be the result, in all probability, if we increased our rate of income tax over that of the British at the present moment. Certainly the yield from income tax that the Minister could look forward to at the end of the year, with certainly anyhow, would be less and not greater than it is at the present rate. Therefore, you have not got any opportunity of further increasing the tax in that direction. The old age pensioners, we are told, and the unemployed, have to bear this burden. The only thing we are doing in the case of old age pensions is this. We have reduced the Estimate for the year to the amount that, with rigid administration, will be required provided no one is allowed to benefit from it who was not intended by the Oireachtas to derive benefit from it. Rigid administration in that matter is necessary, because the more liberal we are, in trying to meet the need of those who are in need, the stricter we have got to be to see that nobody, who is not in need, should benefit by it. It is putting too big a strain on the community to expect them to meet the needs of those who are not in want as well as of the people who are in actual want. It is the same way in the case of unemployment, but in the latter case it must be remembered that we have provided for employment schemes in the Budget and we believe that, as a result of the operation of the economic policy of the Government generally, there will be less need for unemployment assistance in the coming year.
I have some figures here to indicate some of the increases in expenditure over last year that have been provided for. They are as follows: for new public works—principally schools and barracks—we have provided a sum of £142,600 over and above what was provided last year; for afforestation, which will give a considerable amount of employment—practically all of it, I suppose, will go towards giving employment—there is a sum of £110,000 provided in addition to the sum provided last year; for housing grants there is a sum of £236,000 in addition to what was provided last year; for the improvement  of estates by the Land Commission there is a further sum of £80,000—all making a total sum of over £568,000 extra. Then there is the employment which, it is anticipated, will be given in preparing the industrial alcohol factories, which will probably amount to about £100,000 given in employment. We are providing for an increased amount of employment, and the Minister, therefore, feels that he is justified in writing down the amount he originally intended for unemployment assistance by the amount he has already indicated it will be written down by.
The Volunteer Force was mentioned by some Deputy. We were asked: Why is it that we are undertaking such expense as there is in building up that force? We are doing it for this simple reason: that we want to be in a position that, if there should be a European war, we will give no excuse to anybody for suggesting that we are not able to defend our own territory. I think that is a sufficiently good reason.
The President: I have dealt, accordingly, with the points that have been raised by Deputy Davin, and I say that there is no way in which we can meet by taxation the expenditure which we are making except by the methods that have been suggested by the Minister for Finance. If these burdens do extend to all sections of the community, it is not because we want it to be so, but because it must be so; because there are no alternatives to the situation. We have got to do it if we are to provide all these social services that have been voted here in this House. We have Deputy Morrissey, of course, crying out. I think, however, that it was he who moved a resolution here in this House that those who did not get employment should get subsistence. As to the complaint against the amount that we are providing in this Budget for subsistence, Deputy Morrissey is in the ridiculous position of people who adopt the tactics he adopted here.  He wants these services but he does not want the money provided for them.
The President: £300,000 is not being taken away. We made it clear from the start that our policy was to provide work, and only to provide unemployment assistance to the extent that we failed, and while we were in that position——
The President: The Deputy says plenty at times other than the present. We are providing the money necessary to meet these services. We are supposed to be inflicting very heavy taxation on the poor and to have no regard for the poorer section of the community. What are the services we are providing for? The list of services for the relief of the poor includes old age pensions, State contributions towards widows' and orphans' pensions, and unemployment insurance fund, State contribution towards unemployment assistance, purchase of beef for distribution, milk for necessitous children, school meals, child welfare, welfare of the blind, contribution towards the rent of allotments for unemployed; and provision of seeds for allotments. It is not intended or suggested that that is an exhaustive list. We are providing this year a sum of £5,174,300 for the relief of the poor, while the comparable figure for 1931-32, the last year our predecessors were in office, was £2,959,270, showing an increase on services for the relief of the poor of £2,215,030 on the items mentioned. For housing and public works, we are providing this year £3,619,413. In 1931-32,  the expenditure under that heading was £1,660,473, so that there is increased provision of £1,958,940. In regard to public health, we are providing £410,205 against £369,402 provided in 1931-32, or an increase of over £40,000. For disablement and Army pensions, we are providing £375,270 against £194,691 provided in 1931-32, or an increase under that heading of £180,579. For education, we are providing £4,587,322 against £4,471,288 in 1931-32 or an increase of £116,034. For the relief of agriculture, provision is made for an increase of £2,563,259 over the amount provided in 1931-32. I will talk about the agricultural situation when I am dealing with the economic war. The amount provided for the relief of agriculture in 1931-32 was £2,014,536, while we are providing £4,577,795 in the present Budget.
The President: The provision made for agriculture this year shows an increase of £2,500,000. The Deputy should not be talking nonsense. For the relief of local taxation, other than agricultural grants, the amount provided in 1931-32 was £1,159,245. In the present Budget, provision is made for £1,579,363, or an increase of £420,118. For export bounties on industrial and fishery products, a sum of £105,000 is being provided. There are increases shown in our Budget for the services I have enumerated and, in the main, they are to assist either the poor or those suffering hardship as a result of the economic war. The increases amount altogether to £7,599,763. How can anyone who is sincere suggest that this Government has not cared? Let them take their choice and take the other step. Let them vote for the alternative Government if they are dissatisfied.
The President: We are quite willing. I take it that the Labour Party is not voting for the present Government, as individuals, but is doing so because they believe the policy is a good policy for the section  of the community they represent. That is the position as I see it, and I expect the day that position changes the members of the Labour Party will vote for the other side. That is the position we are taking up in regard to it. Out of the resources of the community we are doing what we set out to do. We came here, not as some of the Deputies on the opposite benches would suggest, when the country was flowing with milk and honey, but when agriculture was thriving and prosperous. We came here after we had been pointing for years to the position that was being arrived at in regard to agriculture. We pointed out that, as a result of falling prices, the figure of two-thirds had arisen before we came in as a Government. Prices having fallen to two-thirds of their level in 1924, it was clear to anybody that the old policy would have to be scrapped. We had people from the opposite benches pretending to us that there would be no trouble if only the old policy had been adhered to. What did that policy mean in the past? I am quite willing to admit that if the former Minister for Agriculture—the Minister for Grass, as he was called—had still been in office, if the old policy had been continued, with a diminishing population, if the ports of other countries were open for emigrants, and if we could get rid of the surplus population we might have a higher standard of living for a very much smaller population than we have. I doubt that myself. I believe we ought to be able, and I believe we will be able, to organise ourselves so that a human being as a producer will to an extent produce more than he consumes. That was not the position that obtained in the past. As a result of the old policy we were losing our population at a rate unparalleled by any country in Europe. We had lost half of our population in a period of 80 years. That, and lower prices, was what was facing our country if the policy had not been changed. We went to the people and asked them to put us into office to change that policy. We saw that outside markets were being closed, and we were already warned by the statements  of British Ministers, in which they pointed out that in the Argentine and elsewhere there was scarcely an agricultural product that could not be produced and landed in Britain more cheaply than Britain could produce it.
If that were the position and if there were to be protection of British industry, was it not obvious that, some day or other, you were going on to the Major Elliot period with a policy of protection for British agriculture. One would imagine it is because we have refused to pay a debt that was not due that all this thing has come about. The people of Australia are complaining because the British are buying goods from the Argentine that they expected the British would get from them. So are the people in New Zealand. What is the answer of the British to them? Even though New Zealand was prepared to take their manufactured goods from them, the British were not prepared to give them any protection in their market which would enable the producer in New Zealand to sell at a profit. We were absolutely dependent upon British policy in that regard. The British have a right to restrict imports if they want to, just as we have a right to put on tariffs. They have that right and they will exercise that right at any time that it is convenient to them. Whenever it is expedient they will put a tariff on our products. If this question of the debt that they are claiming had never arisen they might have done that. I am not absolutely asserting, but I believe that if this question of the payment of land annuities had never arisen these quota restrictions would have been put on. They cannot expect to get from us money which this Government will not admit is due.
The President: We are not paying it. It is being stolen from us. There is a difference between paying a thing and having the money taken out of our pockets by force. The money is being stolen from us.
The President: There is a difference between paying money voluntarily and having that money taken from you by force. It is one thing for me to pay money and it is another thing when somebody comes along and takes that money by force out of my pocket. We know that they can take it.
The President: The policy on which we went to the people in 1932 was this: There was a sum of £4,000,000 to £5,000,000 being paid to Great Britain by the previous administration. We said that the money was not due. We can prove it was not due, and we can prove that before any impartial tribunal.
The President: We went to the people and told them that this money was not due, and because it was not due we would not pay it. Our predecessors got the Attorney-General to secure an opinion from a number of  lawyers. That opinion was to the effect that the money was due. That was the case our predecessors put to the people. Later, when we asked the British Government why they were claiming that money, we found it was not on any of the grounds that were set out in the opinion given by the lawyers. They claimed it on a document that was hidden from the people. The principal claim made by the British is based on a document that the Irish people had not seen or heard of until nine years afterwards.
The President: We hold they are taking this money from us unjustly. Then we are told by Deputies to settle the economic war. On what terms? We pointed out definitely to the British, in our dispatches which were published, that we were prepared to settle the thing and to consider the whole merits of this situation and argue it out before a tribunal in which we had confidence. We are open to argue it. We said we were prepared to let it go to arbitration. We said we would not agree to a tribunal that would compromise our position. When we met them in conference what did they say? The nature of what they said was this: If we agreed that this debt was due— though in our hearts and consciences we believed it was not due—if we admitted it was due, there might be some mitigation of the payments. Everything that can be done by people who are interested in the rights of our people has been done by the present Government in this matter. The aim of the British is quite clear to anybody.  Their aim is by this particular method to try to secure a surrender on vital national issues. It was obviously in trying to secure a surrender that they made these proposals to us, but they will get no surrender of that sort from this Government anyway. That is their aim. As long as they had the people on the opposite benches going around the country preaching to the farmers not to pay their annuities, and misrepresenting the position to the farmers, they had hopes that if they did not force a surrender from this Government, they would get the Irish people to put in a Government who would surrender.
The President: The people of this country are not going to be misled. The Opposition tried to mislead them after the first year when the whole thing was put before the Irish people and the Opposition failed. They will try it at the coming by-elections and they will fail again. The Opposition is making the suggestion that they can make a good bargain. But it will be a bad and a poor bargain for the Irish people ultimately if you surrender the national position. These are the terms on which it can be settled. We are supposed to have been complimented in his speech by Deputy Good. I listened to the Deputy, and I did not notice any particular compliment in it. I did notice it was not as wild as the other statements to which I listened, but I did not see in it very much of a complimentary nature. The Deputy did not appear to me to be very complimentary and I wonder what Deputy Davin found complimentary in it.
The President: I repeat that I did not see very much of a complimentary nature in it. Perhaps it was part of Deputy Davin's strategy and scheme to make it appear that we were very hard on the poor but that we were so considerate to other sections that we can get encomiums from Deputy Good——
The President: One passage in Deputy Good's statement which struck me was: “To ignore one's neighbour when we could make trade with him mutually profitable is not a business proposition.” There again you have some suggestion of misrepresentation. I am not suggesting that it is deliberate misrepresentation but it is a misrepresentation nevertheless of the whole position, that we deliberately ignored our neighbour when we could make trade with him mutually profitable. Was there any basis for that suggestion? We are not ignoring our neighbour. We have indicated more than once to our neighbour that we are prepared to make trade agreements with him on a basis that would be mutually profitable. We have suggested  that more than once. We have indicated quite clearly that we are prepared to do business on that basis, but we have never been met on that basis. We have been told: “Oh, yes, we will trade with you provided that you surrender the national position and that you will agree to certain arrangements”—arrangements which the Irish people do not want.
The President: The Deputy has spoken for a long time, and I ought to be allowed to complete what I have to say without constant interruption. I say that there has been no ignoring of our neighbour, such as is suggested. We are not so stupid, to say the least of it, as to ignore him. We have time after time pointed out that up to recently, at any rate, and even now, we occupy one of the highest positions in the British market, that we are buying more goods from Great Britain than any other country in the world. I do not suggest that we are doing it simply for the good of the English people. We are doing it because it suits us and for no other reason—because we get better value there than elsewhere. If we could get better value elsewhere, we would go elsewhere. Not only are we buying more goods from Great Britain than we buy from any other country, but we buy more goods than any other country buys from Great Britain, with the exception of one or two—there was no exception a few years ago. We produced so little industrially for ourselves that the three million people in the Twenty-Six Counties bought more British goods than the three hundred millions in India. We have a very big trading business with Great Britain.
 On the other hand, Great Britain bought more from us than any other country—almost incomparably more than any other country bought. The difference between the two positions— the difference, of course, from a fighting point of view and a resisting point of view putting us in the weaker position is this—it is nothing new; everyone recognises it—that we are her best customer and although in the present situation any country looking for external markets does not want to lose a good customer, although we were her best customer, she had so many others that the amount we bought from her was not a big percentage of her total trade, whereas the amount we sold to her was a high percentage of our export trade. Therefore, from a fighting point of view, we recognise that we were relatively in a weaker position. It is well to see the facts as they are. We have seen them and faced them, and we put this to the Irish people—if they want to make a trade settlement by the surrender of the national position, then they must get another Government. If they want to maintain the national position, as we have presented it to them, then they will have to support this Government and support the position that this Government has taken up. They cannot have it both ways. That is the position. It has been suggested that we should have some national Government and some agreed policy. How can you have agreement on those terms?
The President: We have not suggested it. We suggested that Deputies on the opposite benches should cease sabotaging. When we are in what is really a very difficult struggle, not less difficult because it is going on silently, not less difficult because you cannot go out and stir up people's blood about it; when we are in a difficult  position and trying as quickly as we can to organise our economic life to meet the struggle, we should not have people on the opposite benches going out and trying to make it impossible to win. The only way really to win it is to reorganise our national life on a different basis. We are trying to do that as rapidly as we can.
The President: That is what we are trying to do. We are doing it with a comparative measure of success because the position is not the position that the former Minister for Industry and Commerce—who when in office was simply a laughing-stock from the point of view of industrial development— would like to have it appear. There has been industrial development since the present Government came into office and since his office was occupied by somebody who had an outlook to try and develop.
The President: All over the country it is to be seen. It has been seen constantly all over the country. What we are talking about is plain and obvious. The very fact that the Minister for Finance has to find alternative sources of revenue, instead of the revenue which the previous Administration used to get out of Customs duties—when they imposed Customs duties not to protect industries, but Customs duties that were really sources of revenue—is a proof that we are producing here the things that formerly we paid other people to produce.
An Ceann Comhairle: The debate on this Resolution has lasted for 14½ hours, and I think no section of the House can state that it did not get a fair opportunity of putting its views before the House. Deputies elected by the people should have sufficient control over themselves to hear the President stating his views. Whether they agree with him or not is another matter.
The President: I say it is not even arguable. It cannot be contested that there are produced in this country today millions of pounds' worth of goods which formerly were brought in from outside. That cannot be contested, because the facts are there—the returns are there to show it.
The President: I say that is proof that somebody with initiative, who knew what he was after and got after it, was laying the foundation for future incomes in this country. We are not going to get incomes in the first year. When you start industries you do not expect they will pay dividends and make profits in the first year. We are only two or three years in office. The full effects of the present policy of building up industries, so that our farmers will have some other producers besides themselves to share the burdens of administration, will not be seen in a year or two. You have to wait until the industries establish themselves. At present what is happening is that factories are being built and being organised and that factories are being extended. The position in the milling industry does not obtain with regard to other industries, because there we were in a position in which we were able, by an extra drive at the end, to complete it, so that we are practically self-sufficing in the milling industry. There are a number of other industries,  such as the boot and shoe industry, which are rapidly reaching that situation.
Therefore, the position is that we went to the people and we made definite promises. I issued an election address, and can the Labour Party, or any other Party, come along and show me a single one of these items to which I pledged myself on behalf of the organisation to the people that we have failed in? I pointed out many times during the election campaign that we could not produce miracles. I said that, on account of our backwardness in industrial development, we were in a relatively better position to face the situation than other countries that were already beyond saturation point in industries and that had to deal with unemployment. The fact is that visitors to this country who spent some time in it—I am not talking of those who spent a few days here—who have gone round the countryside and spoken to our people—some of them belonging to our own nation who lived in the homes of the people—who have been in other countries and who are in a position to make a comparison, are satisfied that, as we anticipated we would be in regard to the whole economic situation which is affecting every country, we are in a much better position than other countries. At any rate, that is our belief. We do not intend to change our policy in the matter and we are satisfied that the Irish people at the next opportunity they get will again support that policy.
General MacEoin: The President has charged Deputies on this side of the House with sabotaging. I must protest against that particular charge, because it is a charge that cannot be levelled at any member of this Party.
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