Wednesday, 19 February 1964
Dáil Eireann Debate
That a supplementary sum not exceeding £150,000 be granted to defray the charge which will come in course of payment during the year ending on the 31st day of March, 1964 for Grants to Local Authorities in Relief of Rates on Agricultural Land.
The original Estimate for this year, 1963-64, was £8,816,000 and the amount now requested is £150,000 which will make the revised Estimate  total £8,966,000. When the Estimate was being prepared, before this time last year, it was prepared on the basis of an estimated increase of about four per cent in local authority rates in 1963-64. Here was that Estimate in November 1962, and the Department of Local Government were asked to have a look again at it in February, 1963. They said they saw no reason to change their figure. Provision for that amount was accordingly made in the Estimate, that is, on the basis of a four per cent increase in rates. The actual rates struck represented an increase of six per cent approximately on the previous year instead of the estimated four per cent.
Claims received from the county councils have, therefore, been higher than were provided for in the Estimate. It is calculated now that the amount which will be payable will be £8,966,000. But that, of course, is subject to verification by the county councils. I can, therefore give only an estimate: I cannot give a firm figure. I am asking the Dáil for an additional £150,000.
Mr. Dillon: The occasion of this Estimate highlights the wellnigh desperate situation which is developing in the country in regard to rates in general but with special reference, of course, to the rates on agricultural land. I noticed last week that when the Taoiseach was speaking in the House, he said he now recognised that this situation was wellnigh desperate and that the Government were wrestling with it with a view to finding some entirely new basis of rate collection as they felt the burden on the agricultural industry was becoming intolerable. Last year, as the Minister told us, the Department of Local Government forecast an increase of four per cent. They were 33? per cent below what actually happened. Instead of going up by four per cent, the rates went up by six per cent. Has the Minister any information of what the rates are likely to do in the coming year?
I am told by colleagues who are members of local authorities throughout the country that in some counties rates are likely to go up by 8/- in the £ on the present level obtaining and in  other counties, by 5/- in the £. I understand that, in the municipality here, they have gone up by 4/- in the £ but that has no relevance to the Estimate we are here considering which relates exclusively, I think, to agricultural land.
What do the Government expect farmers to do? We are faced with the fact that they are getting the same prices for milk, wheat and pigs and that they are getting approximately the same price for sheep as they were getting three or four years ago. I am glad to see that the price of cattle is firm. I hope that will continue to be so, though these are critical days. Those of us who are familiar with the cattle trade know that cattle prices tend to rise up to the end of February and then very often fall back. It is a source of satisfaction to see the Trade Agreement of 1948 still operating effectively to keep the price of store cattle strong and firm. The announcement that we are to restore the guaranteed price for barley to the level at which it stood in 1957 is poor consolation for farmers who have faced steep increases in rates every year and who are now faced with record rate increases.
But there is a still grimmer aspect of this situation. I am informed that the rate increases now recommended to the finance committees of the local authorities are designed to finance the increased charges which will come in course of payment by the local authorities in respect of their institutions' increased expenses precipitated by the operation of the turnover tax. It makes no provision for the increased cost the local authorities will have to bear out of the rates in implementing the 12 per cent increase in wages and salaries which has been ordained by the employer-trade union agreement made consequent on the imposition of the turnover tax.
When you think of a farmer, battling along as best he can, who is paying a labouring man or maybe two and meeting an increase in the weekly wages of £1 apiece in respect of each of them and who then has to meet the increase of six per cent last year and  the increase of something like ten per cent this year which is coming, and who is required to live on the prices which have remained virtually static for the past five or six years, is it any wonder Fianna Fáil announce that they contemplate shifting 60,000 farmers off the land before 1970? I wonder if this House ever asked itself what the country will look like if we strip a large part of the agricultural land of Ireland of its population? It will alter the whole picture of the society in which we have all grown up and of which we have, looking around the world, every reason to be proud. I certainly reject most emphatically the thesis that it is a desirable thing virtually to put an end to tenant proprietorship in this country.
Mr. Dillon: Surely someone as familiar as yourself, Sir, with the congested areas of Ireland will recognise that if the burden of rates rises indefinitely as a result of Government action, a great many tenant proprietors in Ireland will find it simply impossible to carry on, unless there is a corresponding increase in the reward for the work done by them.
Mr. Dillon: This is the actual grant from the Exchequer designed to relieve the farmer of £25 valuation and other farmers in respect of the first £25 of their valuation. The Minister told us today he consulted the Department of Local Government last year and that they advised him that the rates would go up by four per cent, whereas, in fact, they went up by six per cent. We may anticipate that in the year ahead they will go up ten to 15 per cent. It is true to say that if you take an increase of 5/- in the £ in Roscommon and 8/-in  Donegal, before any provision is made for the ninth round of wages, it will represent an increase of something in the order of ten per cent or more in rates next year. I simply do not know where it is to come from. I see the Deputy from North Mayo smiling benignly down on me and I hope he will intervene to tell us what his judgment is in this matter.
I feel bound to warn the Minister that my experience in Monaghan is that the farmers are pretty near the end of their tether. This increased burden further diminishes the margin they have between their incomes and their outgoings and if that margin is further contracted, they simply cannot survive. I suggest to the Minister that this Estimate throws into high relief the acuteness of the rate problem that confronts us and that this, I suggest, would be an appropriate time to tell the House whether any progress has been made in the consideration which the Taoiseach announced the Government felt constrained to give to the whole rates structure, in view, as he himself said, of the growing burden they represented on the farmers. It is not a problem which is easy of solution but you can keep piling up straw on a camel's back until ultimately you reach the last and irrevocable straw. Surely the Minister for Finance realises that if after the six per cent in respect of this year, for which he has increased his contribution from the Exchequer, there is added to that ten per cent or 15 per cent in the coming year the situation for the Treasury may be rendered even more difficult than it is already, but the situation of the individual farmer who has to pay the balance of rates will be made virtually desperate.
Mr. McQuillan: I feel the time is overdue for the Government—whatever Government are in office—to carry out a complete overhaul of this question of aids to the farming community, whether that aid is to be by way of relief from the burden of rates or through production incentives. The present situation cannot be tolerated much longer. This blanket distribution, if I could so describe it, of funds to  farmers of all categories is an unsatisfactory way to give what are described as reliefs to that section of the community. Taking the scheme which is in operation, the Minister, I am sure, will recollect that certain action taken by farmers over the past two years forced the Government to increase the amount of money for the relief of the rates burden. It was due to a great extent to the protest marches which were organised throughout the country that we had an increase in the allowances in the past couple of years by the Department of Finance. What I want to emphasise is that no matter what pressure has been brought to bear on the Government, and no matter what the increase in grants may be, the position is negatived by the increased demand on the local authorities for further services resulting in an increase in the rates generally in every local authority area.
Deputy Dillon suggested that in certain local authorities the estimated increase in rates this year is in the region of 8/- in the £. That is a perfectly accurate figure which he has given and if we take the increase in the relief given in this Supplementary Estimate, we find it will go no distance towards offsetting the increased demand on the farming community by the various local authorities. I feel that the general public outside the farming communities have an idea, when they see an Estimate of this nature, that the farmers are being spoonfed or pampered, and people in towns are able to point out that they have to bear the full burden of rates, whereas the farming community are relieved to a certain extent. I do not think that is quite fair, particularly to the small farmer. There is relief of two-thirds of the valuation up to the first £20 but this amount is a negligible sum to many farmers. It is only when you get into the £100 valuation category that you begin to see how beneficial is this allowance under the agriculture grants. Instead of helping the small farmer by taking the burden of rates off him altogether, we are actually, in many instances, under these blanket type grants, helping the inefficient, the lazy and the incompetent farmer.
 It has come to the stage when the maximum production will have to be procured from the land. It is an accepted fact that the small farmer under £25 valuation has to produce the maximum that his land will give in order to exist. What is the position in regard to the larger farmers and those whose holdings extend to 1,000 acres? Are we getting the proper return from these farmers? Are those lands producing the maximum amount which is desirable and necessary in order to reach the targets which the Government have laid down to be achieved by 1970? I do not think so. I do not think the majority of the large holdings are producing up to even 50 per cent of their capacity at the moment.
In cases where there is this lack of production and failure to produce from the lands, we should not be giving grants. There is, I think, a very strong case for an examination into the type of production and the work done by the large farmers before they get one penny relief in rates. There is need for more production from the land where the large farmer is concerned and, instead of relief from rates, there should be a system of sur-rate in order to force the large farmer, who has a responsibility to the community, to produce from the land, or else persuade him to sell that land to the Land Commission. These are aspects which will have to be examined very soon.
Deputy Dillon said Fianna Fáil were aiming to strip a large part of the country of its agricultural population, of its small farmers; that, of course, is what is happening. There is no incentive to the small farmer, and this type of grant will not help the small farmer. Now, while I agree with Deputy Dillon as to what is happening, the fact remains that we must face the situation; that is the policy common to all the countries in EEC——
Mr. McQuillan: The Governments are playing up to the farming Lobbies. The Governments in these two countries are afraid of the farming Lobbies to a certain extent. There are arrangements under the Treaty of Rome for inducing a large proportion of small farmers out of farming and into industry. When we see special arrangements made in the Treaty of Rome for that purpose, we must realise that it is only a matter of time until the large farmers and the industrial elements bring about that change in the pattern of agriculture in these countries.
Mr. McQuillan: I hope they will not. What I do not like to see happening here is this Government making the necessary preparations. In their Blue Book, they even point out that more and more farmers must leave the land.
Mr. McQuillan: We should be fighting tooth and nail to retain the maximum number of small holders. This type of agricultural grant is of no benefit to the small farmer. In fact, the small farmer is put to the pin of his collar, and will be in the coming year, when the increased demand for rates is made on him. Other sections in the rural areas will also be hit. This whole problem will have to be faced. The Taoiseach has stated he is prepared to have this matter examined. That is the type of promise that is thrown out before a general election. The examination may not take place for years. We may wait for years before anything is done. When the problem does come to be examined, we will have to ensure that the small holder is completely  exempted from rates. There must be complete derating for the small farmer up to a certain valuation. After that, we must have production incentives. They can apply to all categories of farmers. The production incentive is essential.
Mr. McQuillan: I suggest to the Minister that he can hardly expect much thanks from the small farmers when he produces a Supplementary Estimate of this nature. The position today is that 11,000 farmers have a valuation between them of £2,250,000. Those 11,000 represent three per cent of the holdings and that three per cent of the holdings with a valuation of £2,250,000 have a greater valuation than 70 per cent of the small farmers combined. If we could get an analysis from the Minister of what proportion of this money goes to the small farmers under £20 valuation and what percentage goes to the category with a valuation of £2,250,000 between them, we would have, I think, a rather interesting breakdown. It is only when we break down the distribution of this money that we will find how much better it could be spent, how much more attractive the grants could be made to the farming community from the incentive point of view.
I do not know that it is necessary for the Minister to have special legislation in order to do that. Perhaps it is. The Ceann Comhairle is in a better position to judge at the moment than I am. If the Minister could alter the basis on which this money is distributed, he would do an excellent job for agriculture without having to increase the overall amount of money available to him for distribution. I suppose it is too much to ask the Minister to consider the  alternative suggestion made to him. The breaking point has been reached in rural Ireland as far as rates are concerned. I am speaking as a member of a local authority. I do not know what will happen before the end of March when the new rate is struck. The allowance given here, because of the type of distribution in operation, will not help the farming community to any significant degree at all in easing the burden of rates. The Minister will have to think up some further means of alleviating this urgent problem before very long.
Mr. Fanning: I believe this is of great assistance to the farmers. Deputy Dillon paints a gloomy picture when he is in Opposition and says the farmers are being badly treated by Fianna Fáil. I do not agree with that. He said it is only by chance that the price of cattle is so good. The fact is the price was never so good. Deputy Dillon should keep silent about wheat. The price the farmers are getting for their wheat now is very good. It is not the price that kills the farmer. It is the climate. Feeding barley has been increased by 2/- a barrel. We have had a promise from the Minister for Agriculture that the price of bacon will be increased. That will be a help to the small farmer.
I agree with Deputy McQuillan that the small farmer is not in a position to benefit by the grants. He uses only very little lime and manure whereas the big man uses 20 times as much. I am a member of a local authority in an area where there is a large increase in rates. I should like to know how these difficulties are to be overcome. There are councillors who want new roads here and new roads there. They cannot be created without increases somewhere. In North Tipperary, culs-de-sac have been taken over by the local authority. The people living in these culs-de-sac want them rolled and tarred. It takes money to do that. That will put up the rates and is there agreement on the increase? When extra money is needed and Estimates are introduced in this House, they are not received too well by some people here. At the moment  the farmers are not doing too badly. As regards the small farmers, the hardworking tillage farmers, what they are saying at the present time, and they are saying it in Kildare in the by-election is: “We are doing all right and we want to be left alone.” They will be thankful for this increase in agricultural grants which is intended to help them.
Sir Anthony Esmonde: As I understand the Minister's statement when introducing this Supplementary Estimate, the farmers are not really receiving any extra benefit. The last speaker implied that the Minister is introducing the Estimate for the purpose of increasing the benefits payable to farmers. He is not. This is only a bookkeeping Estimate because the rates have gone up considerably more than was anticipated by the Government.
It is not that the Government had not been warned about that. It had been repeatedly pointed out to them from these benches that there was no alternative to a rise in rates as a result of the policy they were pursuing. It is quite evident that the increase in rates that has taken place is largely due to the fiscal policy of the Government and of the Minister who is introducing a Supplementary Estimate for £150,000 to offset these bookkeeping deficiencies.
There is no benefit, good, bad or indifferent, in this for big farmers, medium farmers or small farmers. If the Minister intended to make any change, to introduce any extra reliefs, it would have been announced in the answer to a question which I put down yesterday to the Minister for Local Government. I asked the Minister yesterday if he would increase the rate relief for employment on farms to ensure greater employment and to offset the heavy rate increases which farmers have to meet. Here is the answer:
While we are on the subject of rates,  perhaps the Minister who is directly responsible for looking for the extra money from this House to deal with rates will give some indication as to what extra reliefs the Government intend to give the farmers. It is extraordinary that the Minister for Finance in introducing this Supplementary Estimate had not a word to say on that. I should like the Minister to indicate whether he is considering increasing the amount of rate relief on farms, no matter what size they are.
It is important that farmers should be given rate relief in respect of employment. Are there any plans for increasing this relief which is £17 and which has been static over the past ten years? Are there any other schemes for increasing reliefs to farmers? All these increases have been static. Apart from the increase given in the Budget before last, there have been no increased reliefs for those who have to bear the burden of rates. All the speakers, with the exception of the last speaker, referred to the fact that charges are increasing all the time. In this country we depend for our fiscal return, for the equation of our Budget, and so on, on what the farmers can produce. The heavier the burden that lies on them, the less the production will be and the more often the Minister will have to come back to this House with Supplementary Estimates trying to clear up the mess.
There is no other reason why the Minister has introduced a Supplementary Estimate here this afternoon except that the Government and those who advise him have completely misjudged the situation. At the beginning of this year, the Government estimated, with all the facts available, with all the inside knowledge of expert advisers, that there would be a four per cent increase in the rates. Deputy Dillon has very aptly said it is now revealed that there is an increase of 33? per cent on what they estimated. Somebody had done some muddled thinking or else it goes to prove another thing which I have always maintained, that policy conducted in this country is thought out in a theoretical manner without any practical approach.
 Deputy McQuillan said that it is policy in other countries to take people off the land. That is not the policy of the EEC. It is recognised in many countries, as it should be recognised here, that it will not be possible to retain as many people on small holdings as heretofore. Of course, they are striving for a better standard of living. For that reason, the EEC countries and every other country with an agricultural economy as its basis, which is practically every country in the world, have realised that in order to retain the people on the land and give them a better standard of living, they must give them some other form of assistance. For that reason, there have been in all these countries remissions of taxation, many reliefs to the agricultural community.
Along with that, far from siphoning people off the land, they have endeavoured to keep them on the land, if only in part-time employment. They have endeavoured to keep the small holdings as they are, contrary to this Government's policy which appears to be to wipe out the small holdings and compound them into other holdings. That is not the European policy or that of any other country in the world. Other countries have accepted the fact that they have to provide a better standard of living and they are going about it in a different way altogether from that of Fianna Fáil.
I regret to have to tell the Minister for Finance that the very fact that he has come here this afternoon as Minister responsible for the financial policy of this Government proves that they have no policy to deal with the changing situation on the land. They have no policy to deal with the rising overhead charges, to equate conditions of farmers with those of the rest of the community. That is what is fundamentally wrong with the policy of this Government. The sooner they accept the fact that what the man who lives on the land produces is the backbone of our economy, the better. He should be given a fair deal and brought into line with other sections of the community. There is no use in the Government's  talking about a five-year plan or about expanding our economy when they will not go to the root of the problem which exists not only in the west of Ireland—it is more acute and more severe in the west of Ireland and in Kerry, West Cork and such areas — but also in other places as well.
We cannot expect the agricultural community to go on enjoying the same standard of living and having the same remuneration and return as they have had all along. Those engaged in industries are able to increase their charges, but the agricultural community are depressed all the time. There is no use in the Minister chucking them a bone, if he is chucking them a bone. I think he is chucking them nothing. As I said, this Estimate is to clean up the financial muddle that has been created by him as the fiscal controller of the Government's policy. So long as we go on with that muddled sort of policy, we will get nowhere, and we will never have a stable, sound, profitable agricultural economy.
Deputy Fanning referred to agricultural prices and said the agricultural community were thriving, prosperous and happy. I wonder would he care to say that on a public platform outside the House? What this country wants is stability. It is only a couple of months since cattle were £5 5s. and £5 10s. a cwt. At present there is a bigger demand for cattle because of difficulties in the Argentine, which could have been foreseen by the Government if there had been any forward thinking at all. The export of cattle from the Argentine is less than it was, due to a rising population pressure which is likely to continue. Therefore, there is a slightly better demand for cattle than there was heretofore. The price of cattle has rocketed to £7 a cwt., but there is no guarantee for the farmer, big or small, that that price will be maintained. There is nothing enshrined in the Government's policy to maintain it. The same is true of pigs.
An Ceann Comhairle: No; the Deputy is entirely wrong. Deputy Fanning did not mention them seriatim as Deputy Esmonde is endeavouring to do. I do not want this debate to be made a discussion of the current prices of agricultural produce. They are relevant to the extent that they may be referred to in a general manner.
Sir Anthony Esmonde: That is all I am doing. I am merely replying to the Deputy opposite who told us that everything in the village was lovely. I was practically finished when I was interrupted. I was saying that the price of cattle had gone up, and I was telling the House the reason why. I was just referring to pigs when you, Sir, interrupted me. If you do not want to listen, I will sit down.
An Ceann Comhairle: I do not mind if the Deputy speaks, but I do not want him to make an examination of the current prices of agricultural produce. That is all I said. I think that is a reasonable suggestion when we are dealing with grants for the relief of agricultural rates.
Sir Anthony Esmonde: I shall continue by saying that if the farmer does not get a stable price for his goods, he will not be able to pay his rates. I hope the Government have realised that simple fact. Prices are not stable and, as a result, farmers are very hard hit at times and find it hard to pay rates. I hope Deputy Fanning appreciates that what he said was not quite right.
Dr. Ryan: I do not think the farmer will be very much influenced if he is told by one side that he is better off, and by the other that he is not. He will make up his own mind. I do not want to pursue that argument. The speeches of Deputy Dillon and Deputy McQuillan were directed principally towards the farmer's ability to pay increased rates. I want to make it quite clear that the rates for the year 1963-64 on farm land and buildings, in the aggregate, were lower than they were in 1957-58. So far, anyway, the farmer has no complaint in the matter of rates. I am not sure if I will be able to say the same thing next year, and he may have some complaint if the fact I state now does not apply next year. For this year, it does apply.
Dr. Ryan: I cannot say that because the Deputy may say that one individual farmer paid more. There are many individual farmers who paid less this year. The aggregate rates paid by the farmers in 1963-64 were lower than they were in 1957-58.
Dr. Ryan: They have gone up higher than the estimate, but the aggregate of rates paid by farmers on land and buildings in 1957-58 was £7,500,000. This year it is £7,300,000, so that actually it is £200,000 less than in 1957-58. I might say also in connection with this matter that on examining figures some time ago, I found that the three items which concerned farmers very much in their costs were feeding stuffs, fertilisers and seeds combined. They were also lower in the present year than in 1957-58. Therefore, the farmers' costs in their businesses are not up. The farmer has increased costs like every other householder——
Dr. Ryan: However, that was the position. Deputies will know that even if prices of certain items have gone up, the facts I have given still hold. One commodity Deputy Dillon mentioned was milk. If you take that individual item, it must be remembered that as compared with 1957-58, the price of milk is higher and the yield is significantly higher. If we take the milk producer, therefore, we can say that as a farmer, he is better off than in 1957-58. Wages are admittedly higher but wages, as we all realise and agree, are a very difficult problem for the farmer. At the same time, no Deputy would dare to say they are high enough. It is a problem that has to be dealt with.
I have not got the Estimate for next year yet. There is a provisional Estimate which can be deduced, if I might use the term, from the Vote on Account, which is based on a six per cent increase in rates. There is a good lot of talk about the small farmer disappearing. The Government have done everything they possibly can for the small farmer. We have devised a good number of schemes for him. The House will realise it is not easy to produce schemes. If any Deputy in the Opposition benches — Deputy McQuillan has spoken very fluently on this—would suggest a scheme helpful to the small farmer——
Dr. Ryan: I am quite prepared to consider doing more in the way of  credit but I would not go as far as the Deputy in giving them £1,000 each, free of charge, because I feel that is a scheme that would be abused.
Dr. Ryan: The farmers are getting grants as well for reclamation and for many other things. We, as a Government, have produced many schemes for small farmers and hope we may be able to keep them on the land. In that hope, we are prepared to consider any other scheme which may be of help. As Deputies are aware, we would value a committee in each county, with officers and others closely in touch with small farmers, who could see the schemes working and who could suggest other means that might be useful to small farmers in the west of Ireland and elsewhere.
We have provided the funds for helping agriculture as far, I can truthfully say, as this country can afford. We might stretch a point and go further than we can afford if a good scheme presented itself.
On the other hand, I do not see what can be gained by saying that the Government have ordered these people to leave the land. It is not true. Neither is it true to say the Government hope they will leave the land. We have tried to make our Second Programme for Economic Expansion a realistic document. This trend of rural depopulation holds not alone here but in every other country. Ours is a realistic Estimate. It is not an order from the Government, not even a hope. It is only a realistic estimate of what is likely to occur. Having got that realistic estimate of migration from the land, the Programme tries to make provision  for the absorption of those people into other ways of living. As far as I and other members of the Government are concerned, it is our sincere hope that this estimate will not be realised.
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