Private Members' Business. - Petrol and Oil Prices.

Tuesday, 8 March 1983

Dáil Eireann Debate
Vol. 340 No. 10

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Mr. Flynn: Information on Pádraig Flynn  Zoom on Pádraig Flynn  I move:

That Dáil Éireann deplores the recent number of large increases in the price of petrol and other oil products and, in view of the effects of these increases on the family budget, calls on the Government to ensure that the price of petrol and oil products to the consumer fully reflects reductions in the world price of oil.

Molaim an tairiscint seo atá faoi mo ainm agus ainm mo chara, Deputy Ger Connolly, maidir le praghasanna artola ach go háirithe ardú na bpraghasanna le déanaí. Tá na cánacha nua agus an cháin bhreis-luacha i gceist agus arduithe eile atá taréis teacht isteach ó thús na bliana. Táimid in aghaidh na n-arduithe sin agus táimid ag iarraidh ar an Rialtas athbhreithniú a dhéanamh ar an scéal ar fad agus na harduithe sin a ísliú.

My colleague, Deputy Connolly, and I put down this motion because we are [2053] very concerned about the recent trends in the price of petrol and other oil products. We were motivated to put down this motion because of the changing world situation and the downward trend in world petrol and oil prices generally. These trends are not beneficial to the consumer in Ireland. We are concerned about the extra £15 million the Minister intends to take by way of excise duty and which was announced discreetly in the Budget Statement. We regret it as another hidden tax on motorists. We are concerned about the devastating effect of these increases in the price of petrol on the household budget of the ordinary workers, and on the economy in general.

We are astonished at the sheer enormity of petrol prices here as compared with the prices in other economies in this part of the world. We now have the unenviable reputation of having the most expensive petrol in Europe. If we take the figures for the price of petrol in other economies we will get an indication of how severe the impact is here. In the United Kingdom first grade petrol is selling at £1.84 a gallon; in Sweden £1.77; in Norway £2.23; in the Netherlands £2.07; in France £2.22; and in Italy which is always regarded as the most expensive country in Europe, petrol is retailing at £2.71.

We have by far the highest priced petrol in Europe. As the Irish £ strengthens the gap with the United Kingdom will widen still further. There is now a gap of £1 between the Irish price and the British price. This is unacceptable for many reasons. Our prices are away above the average in the EEC. The price of premium petrol here is about 31 per cent higher than the EEC average. The price of our road diesel is about 45 per cent higher than the average in the EEC. These price structures are unacceptable for many reasons which I will go into now.

The burden of taxation on petrol is inescapable for virtually every adult in this State. No consideration is given to one's ability to pay. Taxation is imposed on petrol without regard to its all-embracing effects on our economy. [2054] Instead of providing a basis for the Irish economy, taxation on petrol is helping to destroy the economy. It is destroying three elements in particular. It is destroying our competitiveness; it is destroying our tourist industry; and it is reducing the living standards of our citizens.

It is destroying our competitiveness. The unit cost of production is related directly to the cost of petrol. It is also related to transportation costs. The Government stated in their latest unemployment figures statement that the first point of attack must be on the many competitive weaknesses in the external and domestic markets. The Government are responsible for one of our most glaring competitive weaknesses. The price of fuel is a significant cost in virtually every business and productive enterprise. The Government are responsible for over 50 per cent of the cost of petrol and they intend to enlarge their share still further if the price of oil falls.

The Government's attitude in taking away from the consumer the benefit of any fall in world oil prices exemplifies the narrow fiscal mentality of a Government who are concerned only with keeping their books right and not with the economic welfare of the nation. The Minister was prepared recently to reduce the excise on less essential items such as beer, spirits, wine, cigarettes and tobacco, all of which constitute discretionary expenditure and, in the case of wine and tobacco, are largely imported. He was not prepared to do the same for petrol.

The price of petrol has a detrimental effect on our tourist industry and it is making a nonsense of the promotional aspects of Bord Fáilte's campaign this year. The price of petrol is destroying the living standards of the majority of our citizens. We can no longer say petrol is a luxury item for householders. It is an everyday necessity and can no longer be regarded as discretionary day-to-day expenditure. Rural counties are very dependent on petrol. Recent household budget surveys show that about 8 per cent of weekly income of farmers making £4,500 a year was spent on petrol. This compares with about 5 per cent in families with an average wage of £130 a week [2055] in urban areas. We know that 60 per cent of rural households have cars as against 50 per cent in urban households. This shows that the increases imposed on the price of petrol recently discriminate against rural Ireland.

Petrol prices could almost be used as a barometer for activity in the economy. The costs to the motorist have gone out of control. He appears to be the one person the Minister for Finance considers he has no obligation to protect. It is not just petrol alone: all the other costs have to be included. There were the increases in road tax, insurance and in the cost of maintenance. Every aspect down to the matter of spare parts has been affected. Things have got out of control, obviously with the full support of an uncaring Minister.

We must look also at the effect on the motor trade in general. It is well known that there have been enormous job losses in the trade. Quite a number of garages are on short-time and some of them will never have an opportunity of returning to a five-day week. There are no apprentices being trained in the motor industry. The numbers have decreased year after year and it is a sad reflection on what was a much valued skill that only two apprentices were in training in the whole of the county of Mayo in 1982. I am sure a similar situation applies in other counties. When we consider the average motorist travels about 15,000 miles per year and taking petrol consumption for an average car at 30 g.p.m. the increases since 1 January are adding £3 per week to the overall cost for the average family. That must be considered in a situation where costs are increasing and where incomes are decreasing, with other levies and other forms of taxation being applied. To add this further £3 per week makes the cost of motoring virtually unbearable so far as the average citizen is concerned.

There is a danger that when people find they cannot afford to run a car because of petrol increases they will postpone getting essential repairs and maintenance work carried out. It has also been noted that there is an increase in [2056] the number of motorists who do not have car insurance. The numbers not paying road tax have increase dramatically and it must be stated that the increase in petrol which asks the average motorist to pay a further £150 per year in addition to what he was paying already will have serious consequences so far as the whole industry and revenue are concerned. I am particularly concerned that people may postpone essential repairs and maintenance works because of lack of funds. Much of the repair work has now been transferred to moonlighters in the business and, of course, this results in a huge loss of revenue to the State: loss of VAT on spare parts and on labour and loss of corporation profits tax from the companies operating in this area. This is resulting in the closure of many garages and also in other garages going on short-time working. Many of the legitimate repair shops are redundant and the blame must be laid at the door of the Government. They have no care whatever so far as motoring costs are concerned other than to load on bigger taxes and particularly increases in the price of petrol.

To wage war on the motorist is shortsighted and will be counter-productive so far as tax revenue will be concerned and we are fast approaching the time of diminishing returns as far as revenue from the sales of petrol is concerned. Tax revenue was down quite considerably last year. It covers all excise duty and VAT and these two elements are applied in no uncertain terms so far as the price of a gallon of petrol is concerned. To take further steps against the motorists must be counter-productive and it will have a serious effect on revenue to the Exchequer. The relentless punishment of what must be the most vulnerable taxpayer of all, the motorist, continues apace as though there were no end to the capacity of the individual to pay. He is being forced into a situation of taking alternative methods of dealing with the whole range of other motoring costs, the most serious being his willingness in recent times to risk going on the road without proper insurance, not to talk about the large percentage without road tax.

[2057] We must admit there has been a change in the scene over the years so far as the use of the motor car is concerned. We have to recognise that the car is in everyday use for virtually every family. We will have to take note of some of the statistics being applied to motoring so that we can evaluate the trend. Too high petrol prices are the root cause of many of the difficulties in this area. In 1980 private new car registrations numbered 93,622; in 1981 the figure was 106,074; in 1982 it was 72,775 and that drop is continuing. It is reliably estimated that the number of new cars registered this year will fall once again and perhaps will not exceed 60,000 cars. This will have a most serious effect on the number of people who are available to buy the petrol at the price the Government are forcing them to pay and it will also affect the motoring industry generally.

In 1979 there were 682,958 private cars on the roads; in 1980 there were 734,371; in 1981 the figure was 774,594 and the provisional figure for 1982 is estimated at 709,000 approximately. It is difficult to believe there has been such a vast decrease in the number of cars on the road and I found it difficult to accept that figure but the estimate has come from a very reliable source. Perhaps the reason is that because of the cost of motoring a large number of cars are not taxed. There is no doubt that petrol which is the one commodity that has to be used every day when one is motoring, the item that cannot be avoided because the wheels will not turn without it, is the one item that will be considered first and having regard to the present circumstances, people are prepared to stand back from other essential items such as road tax. The figures are a sure indicator that there is a serious down-turn in motoring by the private citizen due in the main to the increases in petrol in the past few months.

I know the Ceann Comhairle has been in the House for quite some time and I should like to remind him of the figure which applied when he and I understood pounds, shillings and pence. In 1927 it cost 1/8d a gallon and one could buy 12 gallons for £1. In 1976, which is the first year for which I have records for the price [2058] under the metric system, it was 94.8p a gallon. In 1980 it was £1.55p. I am talking about the price for premium grade. In 1981 it was £1.90 and in 1983 it is £2.88p a gallon. Without using a desk calculator I estimate that since 1977 petrol increased by 195 per cent. That increased to 23 per cent as a direct result of the action of the Government. Since March 1983 the excise duty on a gallon of petrol is 98.4p and when one considers that, one gets some indication of the grab that is on by the Government as far as petrol retail prices are concerned.

In 1970 there were 4,772 retail outlets in the country. This year the number is 3,874. Fewer people will be buying petrol. It was virtually the mainstay for the economy over the years as far as revenue was concerned. The Government cannot see that we have arrived at the stage of diminishing returns. Are they taking the Machiavellian attitude that as sales decrease they will increase the tax across the board to take up the slack irrespective of the difficulties it will cause in our competitiveness, tourist industry or standard of living?

A car is now an everyday necessity. For too long it was suggested that it was a luxury for higher income workers. The Government cannot see that the extra £3 they are asking workers to pay by way of increased petrol charges since 1 January must have a detrimental effect on their living standards and on the possibility of getting a proper wage structure this year. The total gallonage of petrol sold in 1980 here was 289,890,000. In 1981 it was 291,108,000. It has been estimated that there has been a significant decrease in gallonage sales and by significant I mean anything in excess of 3½ per cent. It is more likely to be close to 5 per cent. Do figures count for anything as far as the Government are concerned except to increase the price of a gallon of petrol? The excise duty on a gallon of premium grade is 98.4p. With VAT at 52.8p that gives a grand total of £1.51 or 53½ per cent of the pump price going into the coffers of the Exchequer on every gallon of petrol sold. That is on the £2.82 average pump price for a gallon of premium grade. What a starting figure. How has [2059] it come about? There were petrol increases over the years which were necessary on occasions. Since 1 January this Government have put 15p on on one occasion, 11p on another occasion now resulting in 14p extra. We have had a 15 per cent increase in the price of a gallon of petrol in just over 16 weeks. Still the Government are not satisfied. They are suggesting to the motorist that in some slick way they will get a further increase. The figure of £50 million was announced in a peculiar way in the budget a few weeks ago. This must mean 10p more on a gallon of petrol and it is just another tax to add to the litany of tax increases since 1 January.

It was stated last year that an increase of 18p per gallon could bring in £49 million revenue in a single year. These figures do not worry the Minister for Finance. He is adjusting the figures to suit himself in the hope, as somebody said recently, of creating a fund which he can utilise in some underhand way to purchase votes at an election.

The major Irish oil companies get their supplies of petroleum products from two sources — the UK associated companies and the Irish National Petroleum Corporation ex the Whitegate refinery. We all know the situation at Whitegate. The takeoff is about 35 per cent of the total requirements of the trade. We all recognise the total dependency on outside sources for supplies and while this is fully appreciated, as is the need for security of supply, nevertheless we should be able to take fully advantage of the current world situation. We had long-term contracts with Middle Eastern countries and these have now terminated. The way we acted at that time was honourable. We did not walk away from the contracts we had and that will guarantee us goodwill and security of supply in the future. I accept that but when contracts are entered into again there should be an escape clause so that we can benefit from world trends. The trend, as everyone knows now, is downwards but the Government are not prepared to pass on the benefit of this to the hard-pressed motorist by giving him what is his rightful due — a decrease in the [2060] cost of petrol at the pumps. I do not believe we should become involved in further contractual situations until the world market stabilises. We all know there is a glut of oil on the world market and it can be bought relatively cheaply on the spot.

We see in the newspapers the possibility of a reduction of $5 a barrel. That is pure speculation and it is confidently expected by those in the know that it could be reduced further by as much as $26 a barrel. What kind of reduction will that bring? Will the Government give a commitment that they will allow these benefits to be passed on to the the hard-pressed motorist by way of reduction in the price of petrol. The BNOC dropped the price of a barrel by $3½ recently. They supply about one-third of the total requirement of the Whitegate refinery. This could have resulted in the INPC saying immediately they could accommodate a 15p decrease. Was that passed on to the hard-pressed motorist? No. Whatever policy has been adopted by the Government as far as petrol prices are concerned, they are determined not to give the results of world price reductions to motorists here. We can only be suspicious as to what underlying policy they have in depriving the hard-pressed motorist of something which is his due.

It has been suggested by many that there are exorbitant profits being made by the oil companies supplying this market. In my view the time is opportune for an investigation into the sources of supply to the Irish oil companies and to the pricing in-structure to the Irish petroleum companies, how it compares with the world price situation and if there are better arrangements that could be achieved for our motorists and those who rely on the petrol business. The price of petrol cannot be stabilised without some bold initiatives being taken which would concern purchasing, strategy, storage of strategic supplies and the source of supply. If the Government had the will to give the benefit of world prices to the motorist, these avenues could be considered.

Let me nip the metrication device in the bud. It is important that we retain the price per gallon as well as the price per [2061] litre at the source to the consumer, namely, the petrol pump. While I accept the inevitability of metrication, I believe it should be obligatory that the price per gallon be displayed at the pumps as well as the price per litre. The litre only pumps totally disorientate the consumer and make it difficult for the purchaser to ascertain how much per gallon he is paying. Until such time as the advertisements in the mass media stop advertising economies in motoring for their car products in miles per gallon that practice should continue. There is an educational process to be undertaken and I advise the Government before they attempt to devastate the motorists so far as petrol prices are concerned, to consider it well.

Is it too much to ask that the voracious appetite of the all-demanding Minister for Finance be checked so that the long suffering and harassed motorist might get some relief from the windfall of falling world prices, relief which his fellow motorists already enjoy in neighbouring countries? It is time for the Minister to come clean on the real story behind the petrol prices as they apply here.

The measures taken by the Coalition are having a devastating effect on the Border counties. The higher the gap between the prices the more revenue is likely to be lost. Using the census and the household budget survey I estimate that there are about 108,000 households in the six Border counties and the total spending on petrol in these areas would be a very conservative estimate of £50 million a year, of which over half should and would go to the Exchequer. If the inhabitants of the Border counties buy even 40 per cent of their petrol across the border, the Exchequer loses £10 million; if it is only 30 per cent the Exchequer would lose £7.5 million. The average family spending about £480 on petrol this year would be saving about £120 a year, even allowing for the cost of driving the extra miles to get the petrol. Households in the border counties would probably have incomes amounting to an estimated £1,400 million this year. Only 70 per cent of that would be spent on the type of articles that could be brought across the [2062] border. Let us take the figure at a round £1,000 million. Every one per cent spent across the border represents £10 million and if even 10 per cent of income is spent north of the border, £100 million is taken out of our economy and the Exchequer loses between £20 million and £30 million. In addition, if one considers trips from areas outside the immediate border areas — even as far away as Dublin — the Minister may be losing up to £50 million for the Exchequer and up to £200 million or £300 million for the economy in 1983. We should not be creating this kind of incentive for the maintenance of the Border.

There is a very serious and difficult situation arising because of the inactivity of the Minister for Finance in not giving the motorist the benefit of something which is common knowledge to every motorist who has read a newspaper or listened to announcements in the media over the last number of weeks. It is not just a possibility of a few pence reduction that might have to be altered again in a couple of weeks. There is a serious would glut of oil. Those who produce this international resource meet daily to agree not just if they might bring down the price of the day's product but by how much they will reduce it. There is no doubt in the mind of the ordinary motorist that huge reductions are available for the barrel of oil, but they also know that the pricing structure for the Irish petroleum companies is not in accordance with the best deal that can be got elsewhere.

The motorists want to know what kind of pricing structure there is, and how there is such a big differential. They want to know what the Government are doing about this and what they propose to do to provide a different arrangement which will guarantee security of supply and also that there will be no fluctuations in prices in the foreseeable future; the only fluctuations they want to see are downwards. This present price reduction is reflected in every European economy but the only motorist who cannot get a cheaper gallon of petrol is the Irish motorist. He is being mulcted by the avaricious Minister for Finance who seems to demand ever-increasing prices for the gallon of petrol [2063] to satisfy the Coalition's lack of policy to deal with our outstanding economic difficulties. He decides that the quickest and easiest way to get the most money possible is to attach further increases to the gallon of petrol. There has been a litany of increases on the unsuspecting motorist since 1 January, not just by budgetary provision but also, as some commentators suggested, by stealth, by announcing them in advance so that the unsuspecting motorist might not see them at the pumps.

This is not a satisfactory situation so far as the motorist is concerned. His standard of living has been devastated. I have quantified that in pounds as far as the motorist is concerned. It must have a very debilitating effect, not just on the family motorist, but on the economy in general and there will certainly be a reduction in tax revenue. Instead of dealing with the recession, they have put the country into depression and they must carry the blame for it. That is why we are asking the Minister to change his tack and allow the benefit of the world situation in reduced prices of crude oil to be applied to the over-harassed and over-penalised motorist in petrol prices.

Minister of State at the Department of Industry and Energy (Mr. E. Collins): Information on Edward Collins  Zoom on Edward Collins  : I move amendment No. 1:

To delete all words after “Dáil Éireann” and substitute the following:

notes the downward trend in world oil prices and approves the Government's intention to absorb some of this reduction at the retail level by increasing the excise duty on petrol and other road vehicle fuels in order to ensure adequate revenue to support the level of services provided for in the 1983 Estimates.

I listened with considerable interest to the bleatings of Deputy Flynn. I suppose they should properly be taken in context. Of course the tax increases imposed in the budget were substantial. I cannot disagree with that but no Minister for Finance has any great joy in increasing [2064] the level of taxation. One must understand that if Fianna Fáil had been in power they would have been budgeting for an even lower deficit, somewhere in the region of £750 million as opposed to £900 million——

Mr. Connolly: Information on Gerard C. Connolly  Zoom on Gerard C. Connolly  The Minister cannot blame us for everything.

An Leas-Cheann Comhairle: Information on John J. Ryan  Zoom on John J. Ryan  Deputy Flynn was not interrupted.

Mr. Connolly: Information on Gerard C. Connolly  Zoom on Gerard C. Connolly  I want to get the Minister back on the rails.

An Leas-Cheann Comhairle: Information on John J. Ryan  Zoom on John J. Ryan  You have said it now, Deputy. Please do not repeat it. it.

Mr. E. Collins: Information on Edward Collins  Zoom on Edward Collins  If the Opposition were in Government they would have had to introduce a much harsher budget than we did.

Mr. P. Gallagher: Information on Pat the Cope Gallagher  Zoom on Pat the Cope Gallagher  Who are in Government?

Mr. E. Collins: Information on Edward Collins  Zoom on Edward Collins  It is well known who are in Government and who are in Opposition. I understand that these increases are causing frustration but it is too simplistic to condemn tax increases because they affect people's pockets and Deputy Flynn knows that. It is also naive of him to suggest that this Government are suddenly putting taxation on petrol and oil products. One would think that no other Government ever increased taxation in this area. When in Government, Fianna Fáil succeeded in putting taxation on petrol and road diesel, to give two examples. In 1980, Fianna Fáil put 20 pence extra, including VAT, on a gallon of petrol. He does not seem to recall that. I should also like to remind Deputy Flynn——

Mr. Flynn: Information on Pádraig Flynn  Zoom on Pádraig Flynn  That is the sixth time the Minister has mentioned me——

Mr. E. Collins: Information on Edward Collins  Zoom on Edward Collins  I take it the Deputy is spokesman for his party.

Mr. Flynn: Information on Pádraig Flynn  Zoom on Pádraig Flynn  I am spokesman for Trade, Commerce and Tourism.

[2065]Mr. E. Collins: Information on Edward Collins  Zoom on Edward Collins  I should like to remind the ex-Minister that in 1981 his party put 15 pence, including VAT, on a gallon of petrol. Maybe he does not want to recall that either and thinks that these things disappear in the mist of the night air.

Mr. Reynolds: Information on Albert Reynolds  Zoom on Albert Reynolds  The Minister is speaking about a two-year record as against two months.

Mr. E. Collins: Information on Edward Collins  Zoom on Edward Collins  In 1982 Fianna Fáil put a further 8 pence on a gallon of petrol and that should not be forgotten as it also hit the motorist. In 1980 Fianna Fáil put 20 pence on a gallon of road diesel. Does Deputy Flynn think that did not hurt commercial or industrial concerns? In 1981 they put 15 pence on a gallon of road diesel.

Mr. Connolly: Information on Gerard C. Connolly  Zoom on Gerard C. Connolly  Look at what the Government have done in two months.

An Leas-Cheann Comhairle: Information on John J. Ryan  Zoom on John J. Ryan  You will have your opportunity to speak, Deputy Connolly.

Mr. E. Collins: Information on Edward Collins  Zoom on Edward Collins  In 1982 Fianna Fáil put another 8 pence on a gallon of road diesel. I do not think these taxation measures should be forgotten. From 1977 to 1981, Fianna Fáil succeeded in running this country into the ground and raising the national debt to a very serious level. They put our credit standing at risk abroad by the high-flying economics of the now extinct professor who left the parliamentary party a short time ago.

Mr. Reynolds: Information on Albert Reynolds  Zoom on Albert Reynolds  Tell us about 1973 to 1977.

Mr. E. Collins: Information on Edward Collins  Zoom on Edward Collins  Fianna Fáil succeeded in causing very serious budgetary problems. We are responsible for addressing ourselves to these problems. Fianna Fáil had their opportunity in recent years to be responsible and I recall your leader going on television properly and correctly identifying our economic ailments. He then did an about turn and ran away from [2066] them. That is why the country is in such a sad state now.

Mr. Mac Giolla: Information on Tomás MacGiolla  Zoom on Tomás MacGiolla  On a point of order, is the Minister dealing with the motion and the amendment?

An Leas-Cheann Comhairle: Information on John J. Ryan  Zoom on John J. Ryan  If he could do it without interruption it would be better for everyone.

Mr. E. Collins: Information on Edward Collins  Zoom on Edward Collins  All the Members of this House will recall the trend of Government under Fianna Fáil.

Mr. Connolly: Information on Gerard C. Connolly  Zoom on Gerard C. Connolly  What about the Government's advertisement before the last election?

Mr. E. Collins: Information on Edward Collins  Zoom on Edward Collins  The price of crude oil has jumped dramatically over the past decade. In 1973 it was around $2 per barrel. It then jumped to around $11 per barrel. That caused the first energy crisis and created serious dislocations to European economies. Prices remained fairly stable up to 1978 when the price increased to $15 per barrel. In 1981 it soared to $34 per barrel. That increase has caused tremendous damage to European economies.

Mr. Connolly: Information on Gerard C. Connolly  Zoom on Gerard C. Connolly  On a point of information, I gather the Minister of State is reading from a prepared script and as it has been general practice over the years to give the Opposition a copy of scripts the Minister should make one available to us.

An Leas-Cheann Comhairle: Information on John J. Ryan  Zoom on John J. Ryan  I do not have any control over that matter.

Mr. Connolly: Information on Gerard C. Connolly  Zoom on Gerard C. Connolly  It has been the practice. When I was a Minister of State I made my scripts available to Members of the Labour and Fine Gael Parties.

An Leas-Cheann Comhairle: Information on John J. Ryan  Zoom on John J. Ryan  It is a matter for the Minister of State if he has a script to circulate it. If the Minister of State is reading from notes that is a different matter.

Mr. Connolly: Information on Gerard C. Connolly  Zoom on Gerard C. Connolly  I am led to believe that [2067] the Minister of State is reading from a prepared script. From my knowledge of the operation of the Department I believe a script would have been prepared for the Minister. When I was in the Department that was the procedure and a script was always made available to the Opposition. I do not wish to embarrass the Chair or the Minister of State.

An Leas-Cheann Comhairle: Information on John J. Ryan  Zoom on John J. Ryan  The Deputy is not raising a point of order and must resume his seat.

Mr. Connolly: Information on Gerard C. Connolly  Zoom on Gerard C. Connolly  I am raising the matter because when I was Minister of State I always made my scripts available to the Opposition.

An Leas-Cheann Comhairle: Information on John J. Ryan  Zoom on John J. Ryan  If the Minister is not prepared to distribute his script it is not a matter for me but for the Minister. The Deputy should now resume his seat.

Mr. Connolly: Information on Gerard C. Connolly  Zoom on Gerard C. Connolly  I understood it was standard practice to circulate scripts by Ministers.

An Leas-Cheann Comhairle: Information on John J. Ryan  Zoom on John J. Ryan  No.

Mr. Connolly: Information on Gerard C. Connolly  Zoom on Gerard C. Connolly  I understood it was, because I can recall being asked by Deputy Quinn for a copy of my script. Without hesitation I made it available to the Deputy, no problem.

An Leas-Cheann Comhairle: Information on John J. Ryan  Zoom on John J. Ryan  The Minister of State should be allowed to continue.

Mr. E. Collins: Information on Edward Collins  Zoom on Edward Collins  It is difficult to continue with the interruptions from the Opposition. For some reason or other Opposition Deputies do not like being reminded of the history in regard to this matter.

Mr. P. Gallagher: Information on Pat the Cope Gallagher  Zoom on Pat the Cope Gallagher  We are proud of our history. We can go back to the twenties if the Minister wishes us to do so.

Mr. E. Collins: Information on Edward Collins  Zoom on Edward Collins  That is what is wrong with the Opposition.

An Leas-Cheann Comhairle: Information on John J. Ryan  Zoom on John J. Ryan  I wonder [2068] if the House is taking this matter as seriously as it should be taken.

Mr. E. Collins: Information on Edward Collins  Zoom on Edward Collins  I am trying to address myself to the problem.

Mr. Connolly: Information on Gerard C. Connolly  Zoom on Gerard C. Connolly  Is the Minister reading from a script prepared by his Department? All I want is a simple answer, yes or no. I am entitled to a reply. I regret that the Clerk Assistant of the Dáil has decided to interfere. He does not have any right to dictate the procedure of the House.

An Leas-Cheann Comhairle: Information on John J. Ryan  Zoom on John J. Ryan  The Deputy should resume his seat. I have told him that it is the responsibility of the Minister whether to distribute a script or not. The Minister may be reading from notes. It is not my responsibility.

Mr. Connolly: Information on Gerard C. Connolly  Zoom on Gerard C. Connolly  I will make the matter a little simpler. Will the Chair permit me to ask the Minister if he is reading from a prepared script?

Mr. E. Collins: Information on Edward Collins  Zoom on Edward Collins  For the information of Deputies opposite I should like to state that I am reading from notes. I do not have to refer to the notes and I will not do so if that will please the Deputies opposite. I do not wish to upset them.

I should like to point out to the House that as soon as the price of oil reached a peak of 35 dollars per barrel the demand for it in the western world, and in this country in particular, declined. The EEC, and our Government, encouraged that reduction of use. It is important that we ensure that we have an adequate supply of oil for our needs and that was recognised in the seventies when we were being supplied by the multi-nationals who had their own contracts with OPEC countries and others. In 1979 the INPC was formed for the purpose of concluding contracts with oil exporting countries to ensure that we had a continuous supply of oil. That was an important policy move because it brought us into direct negotiation with oil producing countries and it should be noted that that has been an important way of securing our oil supplies.

[2069] Recent events in regard to OPEC and other oil producing countries show that the price of oil is weakening but I cannot subscribe to the suggestion made by Deputy Flynn that we should now be able to buy oil at about 22 dollars per barrel or that we should pursue a policy of purchasing on the spot market for Whitegate. I do not think any refinery could run on the basis of purchasing on the spot market alone. That would be a very unwise move because the spot price could go above the official selling price very speedily and that could land us into serious trouble.

Mr. Flynn: Information on Pádraig Flynn  Zoom on Pádraig Flynn  There is plenty of storage space available if the Government wish to use it.

Mr. E. Collins: Information on Edward Collins  Zoom on Edward Collins  As the Deputy has raised that matter I will deal with it now. It is a fact that we have an IEA obligation to hold 90 days' stock of oil products here but that has not been the case. There is a need when one is talking about security of supply to increase our present level of stock of oil and oil products here. At present about 15 days' supply is held abroad under an agreement. That is permitted but it is not satisfactory and I will be looking at that aspect in the coming months. It is important for the Government to ensure that the 90 days' supply of oil is held here rather than permitting part of the supply to be stored abroad. If a crisis arose abroad it is probable that the supply of oil to us could be seriously disrupted. That would not be in the best interests of the Irish economy.

I should now like to address myself to the decision of the refining companies to cease refining at Whitegate. That was done in the face of opposition by two Governments, the Fianna Fáil Government when Deputy Colley was Minister for Energy and my Government when we were in office two Governments ago. Despite our request the refining companies ceased refining at Whitegate and the Government had no option but to buy Whitegate in order to ensure continuity of refining in this country. That decision [2070] was necessary at the time but in the context of the price of petrol it is interesting to note that, though the refining companies stated that the cost of refining was too high at Whitegate, when the refinery closed there was no marked reduction in the price of petrol or oil products in Ireland. That is an interesting fact to note because these companies are very profit-orientated. They will not give a penny to the consumer unless they are forced to give a reduction. I was disappointed that I saw no reduction in the price of petrol and oil products when the refinery closed.

I feel that the present reductions in the ex-Whitegate price which I announced not so long ago and which were to take effect from 1 April are to be welcomed. It is a reflection of the changing of the crude slate to a more cost-efficient slate achieved within the refinery. One must congratulate the workers of the refinery on their attitude to the operation of the refinery and to the reduction in the cost of crude oil to be refined at the refinery. These reductions amount to 15p per gallon of petrol and 7p per gallon on gas oil. Of course, it must be remembered that the Minister for Trade, Commerce and Tourism has an imput here because the ex-Whitegate price is only one-third of the product cost to the oil distributing company. Therefore their own slate must be adjusted and I hope that they too will take advantage of reducing crude prices to ensure that in the near future they can at least approach the Minister for Trade, Commerce and Tourism and the National Prices Commission with a substantial reduction in their prices for oil. That, of course, does not exclude the responsibility of the Government with regard to their Budget Statement and the statement of the Minister for Finance that he intends to take £50 million back in revenue. However, I hope that there will be a reduction——

Mr. Connolly: Information on Gerard C. Connolly  Zoom on Gerard C. Connolly  On a point of information——

Mr. E. Collins: Information on Edward Collins  Zoom on Edward Collins  Deputy Connolly has been interrupting me all evening for [2071] reasons unknown to me. I am trying to be helpful to the House.

An Leas-Cheann Comhairle: Information on John J. Ryan  Zoom on John J. Ryan  I want to make clear that I will not allow conduct of this disorderly fashion in this debate. Deputy Flynn was allowed 40 minutes without interruption and the least the Deputies on that side of the House can do is allow the Minister to conclude. He has seven minutes left. Whoever will be speaking for the Opposition will have an opportunity to ask their questions and look for answers tomorrow evening. I ask the Opposition to please conduct themselves and have respect for the House.

Mr. Flynn: Information on Pádraig Flynn  Zoom on Pádraig Flynn  It would be much easier if the Minister would speak to the motion.

An Leas-Cheann Comhairle: Information on John J. Ryan  Zoom on John J. Ryan  Deputy Flynn, you were allowed to speak and no-one interrupted you.

Mr. Flynn: Information on Pádraig Flynn  Zoom on Pádraig Flynn  I have not interrupted.

An Leas-Cheann Comhairle: Information on John J. Ryan  Zoom on John J. Ryan  You are doing so at the moment.

Mr. Flynn: Information on Pádraig Flynn  Zoom on Pádraig Flynn  I am addressing you, Sir. If the Minister would speak to the motion——

An Leas-Cheann Comhairle: Information on John J. Ryan  Zoom on John J. Ryan  I am asking you to allow the Minister to conclude. He has seven minutes left.

Mr. E. Collins: Information on Edward Collins  Zoom on Edward Collins  I hope that the oil distributing companies will get their act together. In passing I must express serious disappointment and concern at a number of minor companies in the oil distribution field in Ireland who have failed to take their allocation of liftings from Whitegate. This is a cause of concern, and in that context the major oil companies have honoured the offtake agreement. I regret the action of the minor companies in this regard and I hope that they will see the correctness of playing their part in ensuring an orderly working of Whitegate and an orderly oil distribution market. In the few minutes left to me——

[2072]An Leas-Cheann Comhairle: Information on John J. Ryan  Zoom on John J. Ryan  Five minutes.

Mr. E. Collins: Information on Edward Collins  Zoom on Edward Collins  ——I wish to address myself briefly to the amendment put down by The Workers' Party which could only be described as a far-reaching proposal which the Government could not support at this time. The amendment is very far-reaching and if implemented would cost in present value terms upwards of £600 million depending on the type of refinery decided upon. Such a level of investment in refining might be justified only in the circumstances of an Irish oil find, but the general sentiment of the amendment that the State has a role to play in such an essential commodity as oil is accepted. At least three different Governments have endorsed this in regard to Whitegate and they have highlighted the difference between the responsibilities of a sovereign Government and those of commercial enterprises.

It is fair to say too that the refinery has been in State hands only since last September. I am pleased with the workers in the refinery and with their attitude. I am pleased with the way the INPC have been managing the refinery and effecting economies. The refinery must be looked at to see how it is working and if it is efficient and to ensure that the cost to the State is not excessive. The Government have a responsibility to review all energy costs as the last Government did with relation to the price of electricity. They carried out a review of it. That is only a proper attitude to take with regard to our energy costs. We must understand that we are a little island far removed from the major cities of Europe. There are and will always be the economics of being in an island situation both from the point of view of transport costs to the country and distribution costs within the country. That must always be accepted. We have a responsibility within that context to ensure that our energy prices are as efficient as they can be. I hope that the review of energy prices will prove fruitful and that the Government will be seen to be acting in a responsible manner.

Of course, I would finally like to see a [2073] reduction in oil product prices within the country, but with regard to the context of the motion it is facile to take the taxation policy of the Government with regard to petrol and oil products out of context. You are either going to address yourself to the overall budgetary situation or you are going to run away from it. The last Government succeeded in running away from the budget. This Government will not do that, but in the context of a falling crude oil market price I hope that we will see a reduction in the price of petrol and oil products in this country in the near future.

An Leas-Cheann Comhairle: Information on John J. Ryan  Zoom on John J. Ryan  Deputy Connolly.

Mr. Mac Giolla: Information on Tomás MacGiolla  Zoom on Tomás MacGiolla  On a point of order or procedure, will the Leas-Cheann Comhairle let me know at what stage I will be allowed to put forward the amendment?

An Leas-Cheann Comhairle: Information on John J. Ryan  Zoom on John J. Ryan  First of all, Deputy Mac Giolla, you cannot address yourself to amendment No. 2 until amendment No. 1 is concluded and you cannot move amendment No. 2 until amendment No. 1 has been concluded and decided. I cannot make any promise to you with regard to tomorrow evening. I hope you will be able to get in then but Deputy Connolly has offered now and I am calling on Deputy Connolly.

Mr. Mac Giolla: Information on Tomás MacGiolla  Zoom on Tomás MacGiolla  Will I be allowed at some stage to explain why the amendment was put down?

An Leas-Cheann Comhairle: Information on John J. Ryan  Zoom on John J. Ryan  I cannot promise you anything this evening.

Mr. Connolly: Information on Gerard C. Connolly  Zoom on Gerard C. Connolly  If the House is agreeable I will give Deputy Mac Giolla five minutes.

An Leas-Cheann Comhairle: Information on John J. Ryan  Zoom on John J. Ryan  It will go back to the Government side if you do not continue.

Mr. Connolly: Information on Gerard C. Connolly  Zoom on Gerard C. Connolly  I accept your ruling. I support this motion and I should like to [2074] deal with the effect of petrol prices on the tourist industry. Having been in office only a couple of months this Government increased petrol prices by 30 pence per gallon and diesel by 32 pence per gallon. I am glad the Minister for Finance is present because he stated before the introduction of the budget at a meeting in Athy, County Kildare, that he would like to see the budget deficit brought down to £730 million.

Minister for Finance (Mr. Dukes): Information on Alan M. Dukes  Zoom on Alan M. Dukes  That was on the radio.

Mr. Connolly: Information on Gerard C. Connolly  Zoom on Gerard C. Connolly  Yes, but he was hauled over the coals and, especially with the Labour Party in Government, they were going to devour him. My heart went out to him. Of course he had to take the easy way out, or try to do so. In spite of the reduction in oil prices on the spot market and in the Arab countries, the Minister stated in the budget speech that he would draw all this benefit into the Exchequer.

Mr. Dukes: Information on Alan M. Dukes  Zoom on Alan M. Dukes  Some.

Mr. Connolly: Information on Gerard C. Connolly  Zoom on Gerard C. Connolly  “Some” could mean anything. I always like to see the figures specified.

Mr. Dukes: Information on Alan M. Dukes  Zoom on Alan M. Dukes  The figure is £15 million.

Mr. Connolly: Information on Gerard C. Connolly  Zoom on Gerard C. Connolly  How would that £15 million relate to the gallon of petrol? Would it mean 15 pence or twenty pence? Is the Minister not able to tell me? I would expect him to have that information at the tips of his fingers.

An Leas-Cheann Comhairle: Information on John J. Ryan  Zoom on John J. Ryan  I presume the Minister will answer tomorrow night.

Mr. Connolly: Information on Gerard C. Connolly  Zoom on Gerard C. Connolly  Very good. I am satisfied with that. I wish to deal now with the effect of petrol prices on tourism. It is the opinion of many that petrol vouchers should be made available to holiday-makers at points of entry. This suggestion must be examined carefully because it is no longer attractive for tourists to come here, knowing that they will have to pay the highest prices in Europe for petrol.

As far as I am aware — and I am open to correction on this — the Minister for [2075] Trade, Commerce and Tourism is at present in New York telling people they should come here on holiday. How is he explaining our prices? I should be interested to know how he is getting over that problem.

I was very disappointed in the speech made by the Minister of State. He wandered a lot and talked about the Whitegate refinery. My colleague, Deputy Albert Reynolds, said in September last that the price of oil products would fall in the first quarter of this year. Very few people believed him at that time but he has been proved right.

The Minister might consider making grants available to travel agents to help them put together package holidays. Revenue from tourism has been extremely high in past years, but some new programmes must be introduced. I should also like to see intensive promotions in Europe and the USA. Tourists arriving at a point of entry should be able to secure a package covering hotel accommodation, car hire and especially petrol. This is absolutely essential. There is no use in trying to cod people because they realise that ours is the most expensive country in Europe. Hoteliers and travel agents should co-operate with the Department in special promotions to improve the situation. No such attempts are at present being made. Special grants from the Department should be made available to encourage this promotion work.

The hotel and restaurant business has been experiencing great difficulty during the past few months because of the VAT imposition and we are pricing ourselves out of the market. We should consider advertising abroad to promote our country but we must begin at home by devising a programme that will be acceptable to tourists. The Government must plan a policy in this regard. As things stand, people are being scared off. Many of those employed in hotels have received redundancy notices. Some of the employees in the large hotels and restaurants, especially in the midlands, are on short time. This is a serious situation. There should be a consultation with all the [2076] travel agents and the other interested parties to see if an attractive package can be put together. I cannot see people coming here this year if we cannot offer them an attractive package.

The Border counties will be very badly hit by the high cost of everything. People in those areas have only to cross the Border to get cheaper accommodation, food and petrol. A person driving an average car can cross the Border and fill his tank for £10 less than at a local petrol station. A man who owns a petrol station near the Border told me that his petrol sales have dropped from 6,000 gallons a week to 1,000 gallons. If this trend continues he will have to close down.

I would like to refer to Sunday motoring. People in the midlands like to take their cars out on Sunday and drive to Croke Park, Connor Park in Tullamore, or to other places such as Bray. Petrol retailers in the midlands have informed me that petrol sales on Sunday have dropped by 25 per cent. Motoring on Sunday is a luxury now.

Many workers from my constituency travel to Dublin to work on building sites. Company directors have informed me that those workers are now talking about redundancy as it is too expensive to travel to work in Dublin. Many of those workers have been in the building trade for years and their fathers were in it before them. It is “make your mind up” time.

I am glad the Minister for Finance is in the House. He will kill the goose that lays the golden egg. A man who used to buy ten gallons of petrol will now only buy eight gallons. The Minister is in for a crule awakening in relation to the Border areas. There will be a substantial loss of revenue from petrol sales. Any financial expert can tell the Minister that when one prices anything too high there is a drop in sales. This will result in unemployment. All aspects connected with the tourist industry, as well as hotels, guest-houses and restaurants, are now hit.

On the eve of the election, Fine Gael, with respect to the Leas-Cheann Comhairle, had a great advertisement which stated: “If you vote for Fianna Fáil you [2077] vote for a petrol increase of 15p a gallon”. What did the Coalition Government do when they got in? They put on 30p. When you add in all the trimmings there is more to it. Diesel oil has had an increase of 22p a gallon.

The advertisement of the whizz kids of Fine Gael, dictated by the Taoiseach, appeared for “Garret the Good, the man who does not make errors and does not tell lies”. I leave it to the people to judge on that. That is what I call hypocrisy at its best. This will be remembered by the people. They have good memories. I told the people in my constituency not to be misled by that advertisement. I am glad to say they took my advice. If they had taken my advice elsewhere they would not now be paying through the nose. Fine Gael sold the people more than a pup.

This was wrapped around the necks of the media as well. It was lovely for them. Now they are coming to grips with the situation. The distinguished press men in the gallery now realise it as well. I have here an article by a very eminent journalist, Mr. James Morrissey, who addressed an open letter to the Taoiseach but calls him by his Christian name. The Minister for Finance on radio spelled out what he would do and how he would lower the budget deficit to £750 million. He was caught up in the web then. The Labour members of the Cabinet, the people who would not do any wrong either said, “We do not agree with that. We stand back completely from it”. At the end of the day they put their arms around the Minister and said, “Nice man, you have looked after us”.

The tourist business is wrecked totally because of this situation. The Minister must insist on the Government giving some relief in that area. The industry is crying out for help. Every day representations are made to us from people in the business asking what we intend to do to ensure that some help is given. There will be thousands of job losses in that sector alone if the Government fail to give the help that is necessary. In addition, many hotels will close and once closed will not reopen easily. Any auctioneer would [2078] have difficulty in getting a bid on a closed hotel.

Debate adjourned.


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