Thursday, 25 May 1933
Seanad Éireann Debate
27. Section 9, sub-section (1). After the word “considerations” in line 40 to insert the words “and without prejudice to the rights of employees who are members of existing superannuation or benefit funds.'
Mr. Johnson: This amendment in the name of Senator O'Farrell deals with a matter about which he is specially qualified to speak, and as I gather from the Minister that it is likely that he will bring forward an amendment on the Report Stage which would raise this matter in a slightly different form and which would be probably acceptable, I desire, on behalf of Senator O'Farrell, not to move this amendment now but to defer it until Report Stage.
Minister for Industry and Commerce (Mr. Lemass): It is my intention to introduce on Report Stage amendments which I think will cover the points referred to by Senator O'Farrell in amendments Nos. 27, 28, 29 and 30.
10. No person while employed in the road services department of the company shall be deemed to be a railway employee within the meaning of the provisions of Part IV of the Principal Act: provided, however, that rates of pay, hours of duty, and other conditions of service of employees engaged in such road services as are not provided for under Section 12 of the Road Transport Act, 1932, and Section 16 of the Road Transport Act, 1933, shall be regulated in accordance with agreements made or to be from time to time made between accredited representatives of the majority of such employees of the one part and the company of the other part.
The effect of this new section will be that no person while employed in the road services department of the company shall be deemed to be a railway employee within the meaning of the provisions of Part IV of the Principal Act “provided, however, that rates of pay, hours of duty, and other conditions of service of employees engaged in such road services as are not provided for under Section 12 of the Road Transport Act, 1932, and Section 16 of the Road Transport Act, 1933, shall be regulated in accordance with agreements made or to be from time to time made between accredited representatives of the majority of such employees of the one part and the company of the other part.” I understand in principle the Government is sympathetic to this amendment. It simply  means to say that as far as the conditions of service, hours of duty, and other matters of that kind are concerned the road employees shall not be deemed to be railway employees. They shall make their own arrangements through their own accredited representatives and they will be distinct in regard to conditions of service from railway employees.
Mr. Johnson: I think there is much more in this amendment than the Senator suggested and I hope that the Minister is not going to accept the amendment in any measurable distance of the form in which it is presented. It will be remembered that the section referred to, Part IV of the Principal Act, which deals with employees of railway companies, defined railway employees clearly enough and it provides that the future relations between the company and employees are to be matters for arrangement between the members of the unions on the one part and the companies on the other. Section 8 of the Bill before us makes provision for the transfer of people who are at present engaged in railway services to road transport services and this proposal practically says that the railway company may get out of their obligations under the Railway Act of 1924 by transferring their employees to the road transport services. Beyond that, there is a reference to the Road Transport Act of 1933, which is not an Act of course, and I have rather a notion, judging by the motion that was passed yesterday and the probable dispute between the two Houses, that the Road Transport Act will not be required at all, that this Bill will be held up for 18 months in consequence of the dispute between the two Houses, and that therefore the Road Transport Bill will not become an Act and the whole matter will be left as it is. We cannot refer to the Road Transport Act, 1933, in this Bill until we know that the Road Transport Bill is actually going to be passed.
Then there is the question of “the accredited representatives of the majority of such employees.” There is a good deal behind that phrase. It is a departure entirely from the spirit  of the Railways Act, which has definitely recognised the trades union representatives of employees. We know the kind of movement that is afoot to secure that the majority of such employees shall be organised in companies' unions. And the “accredited representatives of the majority of such employees” may well become another term for the directors of that road transport company. The whole thing is fishy, and I would urge that it be not passed in its present form. I hope that the Minister will at least require, so far as he can influence this House, that it should be altered very materially before it becomes embodied in the Bill.
Sir John Keane: I have no objection to the course outlined by Senator Johnson, provided the whole principle is accepted. I am not wedded to this particular form of words. But I think the Senator is making far too much of a debating point when he says that this Bill might be held up for 18 months. I have been in this House for 12 years, and I only know of one Bill that has been held up for 18 months. I think it is absurd to suggest that this Bill will be held up for 18 months.
Mr. Staines: I agree with Senator Sir John Keane in thinking that what Senator Johnson said about holding up the Bill is wrong. We do not want to hold up Bills at all. We only held up one Bill in all those years, and I think we were justified in holding up that Bill. But while saying that I want to say that I must oppose Senator Sir John Keane's amendment on these grounds: When I came to Dublin, 30 years ago, there were quite a number of good old firms in the city which treated their employees decently. They have been disappearing one by one. Some of them have gone bankrupt, or become insolvent, others have been taken over by other people. One of these good old firms was John Wallis and Company; and, because the railway directors have made a mess of the railways—for that is the plain way of putting it—they had to buy up John Wallis and Company, Dooley's of Cork and a whole lot of others, in order to get rid of the competition. They took  over John Wallis and Son, the I.O.C. and certain other firms on certain terms. The position is not clear to anybody at the moment. We all feel that the railway company owns John Wallis and Sons, and the I.O.C., but suppose they came into court, the question might arise there as to who owns them, whether it is John Wallis and Sons, the Great Southern Railway or the I.O.C., or whether they are separate independent firms.
We look at this matter this way: John Wallis and Son was, as I said, one of the good old firms. When a man went into John Wallis and Sons, so long as he did what he was asked to do, he was as secure as if he were in Government employment, except that he was not entitled to a pension. As long as men did their work in that firm they were not dismissed. There were men there for over 30 and 25 years, and the firm was especially decent to their employees in this way: If a man of long service got knocked out, towards the end of his labour, he would get a small pension; he was not entitled to it, but it was given as a sort of gratuity. The Great Southern Railway bought this firm out, for their own ends, of course, and the position is not clear about the status of the employees, nor as to who owns the firm, whether it is the Great Southern Railway or whether it is an independent firm.
There was an amendment proposed by the leader of the Labour Party in the Dáil to make the position clear, and to give these men the status of railway servants, but that amendment was defeated. We still want to make the position of these men clear. We want to tell these men whether they are or are not railway servants. We want to know what are they. The railway took this firm over. They had to do it because of their own mismanagement of the railways, and now they ask this House to say that these men have no rights. Considering that John Wallis & Sons paid pensions to some of their employees, which of course they were not legally bound to do, I think the railway company, considering we are handing them over a monopoly of the carrying service in this State,  should be decent and withdraw this amendment and even if the position of these men is not clear let them leave it at that.
It was sought in the Dáil to make the position of these men clear by saying that they were railway servants. That was not done. We ask the House whatever else it does not to agree at any rate to this amendment.
Mr. Farren: We have heard a good deal in regard to the reorganisation of the transport services, the question of the capital involved and the consideration that had been given to everything, except to human elements concerned in the transport services. As Senator Staines has said, one of the firms gobbled up by the railway company was known as a decent firm. There are men in John Wallis & Sons, as Senator Staines has pointed out, who have given service for over thirty-five years. If John Wallis & Sons had been allowed to continue as an independent firm these men would receive small pensions when past their labour. Their conditions of service were equal if not better than railway servants. We are asked, in this amendment, to say that in no circumstances whatever are the employees of John Wallis & Sons to be deemed to have the same rights as railway servants. The railway company cannot have it both ways. If John Wallis & Sons is bought out, in the interests of the railway company, the persons who made John Wallis & Sons—and surely the employees had a good deal to do with the building up of the business—ought to be considered. But it appears the employees are not to be recognised. If a machine goes wrong there is the engineer to set it right. If a horse gets ill the veterinary surgeon is called in, but if anything happens to the human being that is a matter for the poor law.
I suggest to Senator Sir John Keane that he ought to withdraw this amendment. He is raising a matter here that is very contentious, and in the last paragraph of his amendment he is endeavouring to undo what some of us have spent a lifetime trying to do, that is, to try to arrange that conditions of service shall be regulated and  carried on by trade unions' representatives on one side and employers on the other. This amendment is designed specifically to cut out the representatives of the trade unions in any dispute between the employers, such as the Great Southern Railways Company or any other transport company, and the employees concerned. From my experience, that is a very foolish thing to do. People who have experience of carrying on negotiations on a large scale on behalf of employers in any large industry have found that the best way to bring about agreement is not by getting little groups in a particular concern and asking them to negotiate, but by getting the trade unions concerned, engaged in the industry, to carry on these negotiations. I suggest that in all the circumstances this amendment ought to be withdrawn.
Mr. Bagwell: I wish to speak in favour of this amendment. Road transport is going to take the place, very largely, of railway transport in various parts of this country. One of the reasons why the railways are in their present collapsed condition is uneconomic wages—that is, wages that are higher than the industry can bear over a long period of years, and conditions of service that are too expensive and not fitted for this country. If that state of affairs is passed on to the road transport it will not only be bad for the transport service but for the public, because these charges are passed on to the public and have been passed on to them for years and years past. Rates have been very much higher than it is desirable they should be, and the reason for that is that working expenses were so great.
I think that it would be a great mistake, in the national interest, if railway conditions, which have arisen from circumstances into which I do not propose to go now, were to be passed on to the road transport as if road transport, for some particular reason or other, could bear more uneconomic conditions and more onerous conditions  than any other form of transport in the country.
Mr. Lemass: Arising out of Senator Johnson's remarks, I think it is advisable that we should consider the remaining sections of this Bill in Committee here without regard to the circumstances that may arise in the event of dispute between the two Houses concerning any part of it, and that we should endeavour to get them into the shape that is considered best from all points of view. As regards this amendment, I am sure that no one here will dispute the wisdom of getting clarity in so far as it affects the position of the railway company with regard to its employees. Under the Act of 1924, the company—the G.S.R. Company—was required by law to regulate the wages and conditions of service of railway employees by agreement with the trade unions' representatives of these employees. I do not think, however, that it will meet the present position to leave it exactly like that because a railway employee, according to the definition of that Act, is not merely anybody employed by the railway company. There is a Schedule to the Act setting out the various grades of employees to which that part of the Act relates, and it is necessary to have it clear that the obligation upon the company to regulate the wages and conditions of work by agreement with the trades unions' representatives of the employees will extend not merely to those who are classified in the Schedule but also to other employees of grades not contemplated in the Act of 1924 but who will be in the company's service in consequence of the changes that may be effected following the passage of the Road Transport Bill.
I contemplate introducing an amendment upon the Report Stage which will be almost similar in words to the section of the 1924 Act affecting railway employees and which will require that wages and conditions of service between the company and its road service employees will be regulated by agreements to be made between the company and the trades unions' representatives of the employees. That will  clear up ambiguity, I think. Certain ambiguity might arise if it is left as it stands because, included in the 1924 Act, there are clerks who are merely described as clerks (male and female), and a cartage staff described as carters, road motor drivers and working foremen. The position of these people would not be clear if the Act were not amended so as to provide that the wages and conditions of road service employees of all kinds, whether clerical workers or omnibus drivers and so on, are to be fixed by agreement the same as the others. It does not really matter whether the conditions of service of the employees of John Wallis and Sons or of the Irish Omnibus Company are satisfactory at the present time. I am aware that, in the agreement which was made on the occasion when the firm of John Wallis & Sons was taken over by the Great Southern Railway Company, it was stated that the terms of employment and conditions of employment would be not less favourable to the employees than those they had enjoyed previously. As far as I am aware, the rates of wages and conditions of employment in both the firm of John Wallis and Sons and that of the I.O.C. are determined by trade union agreements. My object merely is to ensure that that will continue and that the company will be required to regulate, by agreement with the trades unions representative of the employees, the conditions of employment of the railway workers under the 1924 Act and, under this Act, the rates of wages and conditions of employment of these road transport workers. I think it will be agreed that the agreements that might be made and that have been made for railway workers could not be automatically applied to road transport workers because they are in a different class. In some cases, they might think themselves entitled to better treatment than railway workers, and in other cases, where the work was less onerous, it might be thought that they were not entitled to so much. It is, obviously, a matter for negotiation and agreement. It is with that object that I propose to introduce an amendment relating to road workers in almost the same words as those in the section  relating to railway workers in Part IV of the Act of 1924.
12—(1) Notwithstanding anything in the Principal Act, but subject to the provisions of this section, a railway company may, if it thinks fit, make such charges for the carriage of the merchandise of any trader, or for the carriage of any part of his merchandise, as may be agreed between the company and that trader:
(4) On any application under this section, the Minister shall have regard to all considerations which appear to him to be relevant, and, in particular, to the following considerations, that is to say:—
(i) so much of Section 90 of the Railway Clauses Consolidation Act,  1845, and of any section of a local and personal or private Act, as relates to the obligation of a railway company to make equal charges to all persons under like circumstances; and
(ii) so much of Section 2 of the Railway and Canal Traffic Act, 1854, and of any section of a local and personal or private Act as relates to the obligation of a railway company to accord no undue preference to any person, and Section 27 of the Railway and Canal Traffic Act, 1888, which relates to complaints with respect to undue preference.
(7) An agreed charge which is for the time being approved by the Minister shall not be deemed to be an exceptional rate for the purposes of the provisions of Part III of the Principal Act, which relate to the modification, revision and review of charges.
This amendment is a long one, but the principle of it is fairly simple. It is to give the company freedom of negotiation with traders in regard to rates. As I understand the matter at present, if exceptional rates, that is, rates outside the standard rates, are to be given, the consent of the Railway Tribunal has to be obtained. I understand, further, that any exceptional rates so permitted have to be given to every trader offering similar goods for transport, irrespective of quantity. Any business person must concede that those conditions are extraordinarily embarrassing. There is no need to mention names, but I can picture a big firm coming to the railway company and saying: “Unless you give me a flat tonnage rate on my commodities I have resources to move those goods in  another way. I have my own transport service, and I can move them on the road, outside the railway altogether,” or it may even have its own shipping service and say: “I can move them by water.” It does seem only reasonable, as a business proposition, that the railway company should go and negotiate the best terms they can under the circumstances with those who are offering transport, while those who are in a position to get more favourable rates, owing to the quantity of goods they have to offer, or owing to the competition which within their own resources they can provide, should be in the position of the railway company to meet the company and make the best deal they can. To my mind, freedom of negotiation of that kind is implicit in any form of business. If you were to place hampering conditions on any concern you would make it almost impossible for it to carry on. There can be no hard and fast rate that should be applied to big and small alike. It should be within the power of the company to deal with circumstances as they find them—to give concessions where, without those concessions, they could not get the business at all. That is, in effect, the object of the amendment. There are other members of the House who know the technique of this matter better than I do. I hope they will speak and supplement perhaps what I have omitted.
Mr. Bagwell: I am not sure that this amendment is going quite the right way of dealing with this matter. If this amendment were embodied in the Act it might improve the existing situation. I speak on this with some diffidence, being conscious of the fact that I am not so up-to-date in matters of this kind as I used to be. The whole gist of this centres round the issue of undue preference. It is well known that undue preference can be a very bad thing. It could have the effect, for instance, of driving a trader out of business because another is being offered undue facilities for one reason or another, not altogether legitimate. There has always been control for that reason in these islands in this matter of undue preference. The authority for control in this country for some years  has been the Railway Tribunal. I have no personal knowledge how that sort of business is dealt with by the present Railway Tribunal, as it did not come within my experience. As the authority to control this matter of undue preference and prevent it, it seems to me that such a tribunal is, or ought to be, a better authority than the Minister. For one reason it has got an element of permanence and a certain amount of technical experience. I am inclined to think that a better way would be to alter the machinery of the Tribunal in such a way as may be found necessary to avoid the present delays which, I understand from the amendment, are excessive.
What constitutes undue preference is a distinct thing. It is a matter that would require to be dealt with by a person of long experience and a certain amount of technical knowledge. Years ago it used not to be held that it was necessary to give every man exactly the same chance between certain points, because if one man had, say, 10,000 tons to move, you naturally gave him a lower rate than the man with only 100 tons to move. I do not know how that is dealt with now. On principle, I think it would be better if matters of this sort were dealt with not by a Minister, because Ministers change, but by a more or less permanent authority which would have experience and understand better the technique of the thing. For that reason I am not very confident as to whether this amendment is the right way of attacking the matter. I am sure that the Minister has considered this, and when I have heard his views I will be in a better position to know whether I can support the amendment or not.
Mr. Comyn: I do not know what view the Minister takes of this amendment, but I do not think Senator Sir John Keane's speech has justified it in the general terms in which it is expressed. When I first read it I saw that if it were adopted it would lead to very much dissatisfaction. It is an amendment which can be justified only on the assumption that the railway company, if they did not make a special  bargain, would lose the business altogether. In its main aspects it is an amendment which tends to favour the big concerns. I do not know whether the Minister considers that is good policy or not, but if the railway company are allowed to favour big concerns to the prejudice of small concerns, this amendment, if adopted, will cause a great amount of trouble. I think Senator Bagwell's suggestion the better one. I think that there should be some form of independent control by a continuous authority which would be unaffected by any considerations except the justice of the case. I do not suggest that the Minister for the time being would be affected by any other considerations, but the Tribunal —I have some little experience of the disputes which have arisen—
Mr. Farren: On this question of rate-cutting, I am entirely on the side of the railways. I do know that there has been uneconomic transport service in this country, and that it has been responsible for landing the railways and everybody else concerned in the mess in which they find themselves at present. The railway company, I think, must share some responsibility for that. We know that under the 1924 Act there was a provision in the case of the carrying of merchandise, requiring the railway companies to have a fixed charge. Under exceptional circumstances they were entitled, I think, to have a lesser charge than that fixed. They had to go before the Railway Tribunal if they wanted to lower their charges. We know, unfortunately, that the procedure laid down for doing that enabled the competitors of the railway companies—some of these competing concerns were owned by the railway companies themselves—to steal traffic from them.
It is a notorious fact that it was  some of these subsidiary companies owned by the railway companies that did most damage to the railways from the point of view of loss of traffic. While I think there ought to be a certain amount of freedom given to the railways, I think it ought not to be such as to enable them to embark afresh on the transport war that has been going on here for the past few years. I am prepared to give them as many facilities as possible, but I think it is expecting too much to give them the facilities asked for in this amendment. I should like to see something in the nature of exceptional circumstances attaching to it and I should like to see the Railway Tribunal retained as the body to which the railway company should go for the purpose of asking for these reduced charges. I am wholeheartedly with the railways, because I know they have suffered because of this unfair competition that is going on against them, and some effort ought to be made to strengthen their position, but I do not think I would be prepared to give the railways full facilities to cut their own throats as they have done before.
Mr. Counihan: On the Railway Act of 1931, an amendment on similar lines to this was proposed and, on that occasion, I spoke and voted against that amendment. I could to-day put up very strong reasons for rejecting the amendment proposed by Senator Sir John Keane. I could quote instances which I think would convince the House that we should not accept the amendment, but, considering the position of the railway company and considering the time they have gone through—and their directors and officials say at present that unless they have a free hand they cannot carry on—I am prepared to give the railway a free hand and to withdraw all restrictions from them in relation to competition with road transport. Even then I am afraid we will not be able to save the railways, but for these reasons I support the amendment on behalf of the cattle trade, although I should like to see it,  as Senator Bagwell said, more specifically defined.
Mr. Johnson: I should like to hear from Senator Sir John Keane some argument in favour of the abolition of the Railway Tribunal, because that is what is involved in the first two or three sub-sections of this new section. The new charges are to be made by the company if it thinks fit with the approval of the Minister. The Railways Act of 1924 makes provision for exceptional rates, subject to the approval of the Railway Tribunal. Now it would appear that the Railway Tribunal is to be abolished and the Minister substituted for this purpose. I wonder would the Senator explain why he desires that change to take place, because it seems to be rather inconsistent with his general attitude?
Sir John Keane: If the Senator is looking for consistency in politics— from any quarter—I am afraid he will be disappointed. The reason why the Minister is preferable to the Railway Tribunal is because he is, I understand, more expeditious, and there is not the same expense or formality to be gone through. There are two points involved in the amendment, first, the question of the Tribunal or the Minister and, secondly, and more important, the question of the flat rate. My information is that, as the law stands at present, the flat rate is illegal. If the company quoted a firm a certain rate per ton for 100 miles, another person can come in and claim that rate for five miles.
Sir John Keane: I am sorry I am not sufficiently expert in this matter, but I understand that the flat rate at present is illegal. I may not be quite clear as to the technique of the flat rate, but I understand that it is illegal, and that it is by reason of their inability to grant a flat rate that the companies are handicapped and that they are seeking to grant flat rates. I might say, if it is any guide to the House, that under the English Transport Bill the power to grant flat rates, subject to the approval, as  Senator Johnson will be glad to hear, of the Tribunal, but not of the Minister, is being given for the first time. For the first time, the principle of the flat rate is now made legal, subject to the approval of the Tribunal, and what we are seeking here is that the principle of the flat rate should now be sanctioned by law.
Mr. Counihan: I do not think that Senator Sir John Keane is quite right in his explanation. The railway company, as I understand it, have sufficient powers to grant flat rates to anybody or to any place, but the condition is that anyone applying for the same rate on the same conditions must get it. They can give flat rates, and can give rates 40 per cent. below the rates fixed by the Tribunal, but if they give rates 40 per cent. below they will have to apply to the Tribunal for permission within six months. What the railway company want, and what this amendment seeks to give them, is permission to give preferential rates, and there is a great difference between preferential rates and flat rates. As I said, objection can be taken to it, but the amendment states clearly that it is preferential rates they are seeking.
Mr. Lemass: I think that Senator Counihan is beginning to find out what this amendment is about. I was rather surprised to hear him suggest that the Cattle Traders' Association were favourable to the introduction of the flat rate for cattle, and it is quite clear that that is what the amendment is designed to provide for. The railway company at present has power to give exceptional rates in certain cases, with the sanction of the Railway Tribunal, but this amendment is designed to enable it to charge, in certain circumstances, flat rates, and to enable them to charge these rates in circumstances which exempt them from the obligation to make equal charges to all persons in like circumstances and from the obligation to accord no undue preference to any person and from the obligation of publishing the charges.
 I think this is by far the most revolutionary proposal in relation to transport introduced here yet, not excluding anything in the Railways Bill relating to capital or anything else. This amendment is clearly founded on a section of the Road and Rail Traffic Bill which was recently introduced in the British Parliament. Whether that Bill is likely to become law in the form in which it was introduced is a matter concerning which I have no knowledge, but, judging by the opposition which has been developing to this particular section in it, I think that it is most unlikely and, yet, that section in the British Road and Rail Traffic Bill is far less objectionable than this because it, at least, provides the victimised trader with an opportunity of making his objection and having his objection heard. There is no such provision in this amendment at all.
I was very pleased to hear the things Senator Sir John Keane said about the Minister for Industry and Commerce and I thank him for the complimentary references. They are not necessary, however, because this amendment is designed practically to make the railway company the Minister for Industry and Commerce. It is designed practically to give the railway company power to determine what industries are to exist, what industries are to go out, where the industries are to be located, what traders are to be allowed to carry on trade and what traders are to be made bankrupt and, generally, to regulate the whole economic life of the country at their own sweet will and discretion and without publicity. They are to be given absolute discretion to give one rate to one trader, another to his competitor and a third to somebody else.
If this amendment is carried they can regulate their charges in any way they will in accordance with agreements made between them and individual traders or manufacturers. There is, of course, the provision that the Minister must approve of each charge, but under the circumstances that is a safeguard which is of very little value. The first thing to notice,  however, is that this amendment is entirely contrary, not merely to the principles of the Railways Bill and the Road Transport Bill, but to the whole traditional transport policy in this country and in Great Britain. Heretofore, transport policy has been based entirely on the principle that preferential treatment must not be given by a transport organisation to any one firm or individual.
Mr. Bagwell: I beg the Minister's pardon, but I should like to correct the statement he has just made about preferences. There has always been a system of preferences in operation, and there must be. The principle of reduction in respect of quantities is universal. What is not allowable is undue preference, if I might with great respect make that correction of the Minister's statement.
Mr. Lemass: The principle upon which transport legislation has been based heretofore is that, under similar conditions, all persons should be treated alike by railway companies and other transport organisations which are in the same position, so far as the law is concerned, as railway companies. So far as the Great Southern Railways Company is concerned, those principles were made effective by a system of standard charges and standard classification. So far as the other companies are concerned, they were made effective by the obligation that rests upon them under various statutes to have maximum charges and classifications of various kinds. Under this Bill, we are taking steps to bring the system of standard charges, so far as it affects the Great Southern Railways, up to date and to make it really effective. It has not been effective heretofore because of the number of exceptional charges granted by the railway company after application to the Railway Tribunal. I do not know if the British Parliament is going to reverse the principles upon which its transport legislation was heretofore framed. I think that is unlikely but, if they are going to move in that direction, that is no reason why we  should do the same. The British Rail and Road Traffic Act has a number of very satisfactory features. It is particularly gratifying to us to note that they have followed our lead in quite a number of the innovations introduced in our Road Transport Bill now under consideration. In so far as they have done so, they seem to be going along the right lines but when they depart from that lead, they are wandering on to dangerous ground. This is one of the things in respect of which they have gone outside the bounds of reasonableness and it is quite likely that the opposition which has developed to this section in Great Britain will be more than sufficient to defeat it. The acceptance of this amendment would mean the recasting not alone of the entire Railways Bill but of the Road Transport Bill, which is also founded on the principle that, under similar circumstances, similar facilities and conditions will be given to everybody. If we depart from that principle and give the railway company power to grant preferential treatment, to enter into separate agreements with certain firms which will not be applied to and will not be known to other firms, we enter upon an entirely new line which will involve the recasting of our entire legislation on this matter. I do not think that we should do that. I think that there is a case to be made for permitting the railway company to charge a flat rate for certain commodities, subject to that flat rate being available to everybody who wants to transport these commodities and subject to the necessary safeguards of the public interest in that respect. I am considering the possibility of framing an amendment for the Report Stage which will provide for that. That is not a very simple thing to do since the interests of other transport organisations, such as the canal company, must also be preserved. Like the railway company, they are at present debarred from entering into flat rate arrangements such as the railway company is now seeking power to make. The possibility of permitting the railway company to quote rates for the carriage of goods by rail and road combined  where the portion of the rate attributable to the rail service might be less than the standard rate is also being considered. If found feasible, we may have an amendment on Report Stage to deal with that matter also.
To the general principle of this amendment, I think there must be, particularly on the part of those who regard it as their duty to protect commercial interests, very vigorous opposition. To give the railway company the powers proposed in this amendment would be to create an almost intolerable position for a large number of the business people of this country. They might find themselves in a position in which they would be competing with others who had entered into an agreement with the railway company for such favourable transport terms that they would be given practically a monopoly of the market. That could easily happen. A Senator talked about some firm saying to the railway company: “We shall not give you our transport unless you give us a flat rate per ton, irrespective of distance. If you do not enter into an arrangement to give us that flat rate, we shall arrange to transport our goods by means other than rail.” What is much more likely to happen is that a firm would say to the railway company: “Give us a flat rate that you will give to nobody else and, in these circumstances, we shall send our goods by rail.” What is asked by this amendment is power for the railway company to enter into such an arrangement. The possible results of that arrangement are so very obvious that I am surprised that anybody familiar with the circumstances of business firms would support the suggestion.
We have also to bear in mind that, in the first place, we are proposing in these two Bills to place the railway company in what will be tantamount to a monopoly position and, secondly, that the safeguards which would exist if other means of transport were available to those prejudiced in their interests by the railway company will be removed. It is to this monopoly organisation these very wide powers of discrimination are to be given under this amendment. I do not  think that we can contemplate that. I think that this amendment should be vigorously resisted and whatever difficulties it is hoped to meet met in some other way. I think that we must preserve the principle of having exceptional rates sanctioned by the Railway Tribunal, which is a court, rather than by the Minister for Industry and Commerce or some body who has not got the same status as a court. At the same time, if we authorise the railway company to charge a flat rate, we must ensure that that flat rate will be available to everybody who desires to transport the commodities to which it applies. In giving that power to the railway company we should take whatever steps are necessary to ensure, firstly, that nobody is going to be prejudiced by possession of the power and, secondly, that the position of other transport organisations vis-a-vis the railway company will not be seriously impaired.
Mr. Counihan: I agree with the Minister that there are serious objections to this amendment. What the amendment seeks to do is to place the railway company in the same position as their competitors, the lorry owners. At present, there is no law to prevent the lorry owners from quoting preferential rates for the carriage of goods. The aim of this amendment is to place the railway company in the same position as their competitors now occupy. In view of the Minister's statement and in view of the fact that he is to introduce an amendment on Report Stage. I ask Senator Sir John Keane to withdraw his amendment until we see the Minister's amendment.
Sir John Keane: After hearing the Minister's statement, I do not apologise for having introduced the amendment, because I think it has brought about a very interesting discussion. I am glad to see that there is at least a germ of reason in the Seanad, and that the Minister, on the Report Stage, is going to do something, or what he considers fit, to deal with this flat rate question. I understand there are  certain commodities — and one special commodity in which the Government is interested — which will perhaps lend themselves to special flat rate treatment. I ask the Minister to consider the effects of an arrangement where one firm says: “We will give you several thousand ton miles of a commodity.” A rate is quoted, but when another firm comes along with an infinitesimal ton mileage of the same commodity they pay at the same rate.
Sir John Keane: Take the position of one firm that moves commodities all over the country from Cork to Dublin and gets a flat rate, and then take the case of another firm which has to move the same commodities from Dublin to Bray and claims the same ton mile rate. That is my information. It may be wrong. I will leave it at that. The Minister is to consider the whole question and to go, as far as he can, in making the flat rate principle applicable, without injustice to any trader, and with due regard to the interests of the carrying company. I ask the leave of the House to withdraw the amendment.
The railways of this country want the best advice it is possible to get, if they are to carry on. It is a bad policy, as we know, to change horses midstream. In this case it seems to me that the  proposal is to change horses when the river is in flood. The railways may be compared to a river with tributaries and a skilful pilot is needed to guide them through troubled waters. I want to ask the Minister, or any member of the Government, if they know of any man who was more fully qualified to fill the position he held than the pilot they want to drop overboard. Let us consider who this pilot is. He happens to be a Tipperary man, who came to Dublin in his teens, and joined the Dublin, Wicklow and Wexford Railway as a clerk. This gentleman wound up his railway career as the general manager of the greatest railway in the world. The Minister spoke yesterday about the economies, amounting to over £1,000,000, that had been effected under the Railways Act of 1924. It would be interesting to know who was responsible for most of these economies. I think I know. Possibly I know the gentleman in question better than the majority of Senators. I am aware that on all occasions he was willing and anxious to help this country. I am satisfied that since he occupied the present position—a position that was in many ways unpleasant for him—he did so simply because he thought he would be of some use to this country. I have personal experience of his kindness. In 1920-21-22, when things were very bad here, and when large numbers were unemployed, as a member of Lord St. David's Committee this gentleman got £24,000 for the Dublin Port and Docks Board for development work. As a result 500 men were employed for a considerable time. If this gentleman is removed from the position, personally I shall be glad, because it will give him an opportunity of being free from worry, and of enjoying his remaining years, but, on the other hand, I shall be very sorry in the interests of the railways.
Mr. Farren: I opposed the principle enshrined in the Railways (Directorate) Act of 1924, that principle being that we were giving a certain outside company power to nominate a director on the new board of the Great Southern Railways. Notwithstanding what Senator Moran has said, if the shareholders of the Great Southern  Railways Company think that the person concerned is a suitable and proper person to look after their interests, there is nothing to prevent them electing him. What we object to is the principle, that any outside company should have the right to nominate a director on the principal transport service in this country. The gentleman concerned is known to all here, having been a former member of this House. He can still render the services that Senator Moran thinks he is capable of rendering to the shareholders of the Great Southern Railways, and there is nothing to prevent them at the next election returning him at the head of the poll. What we say is that we are not going to agree to the continuance of an Act of Parliament that was, in the first instance, wrong and the principle of which was vicious. The proper course is to repeal the Act of 1924, and accordingly the House should resist this amendment. If the gentleman's services are so valuable the railway shareholders have the opportunity of electing him to look after their interests.
Mr. Dowdall: When the Railways (Directorate) Act was before the Seanad I opposed it more strenuously than I opposed any other measure brought before this House. I said then, and I say now, that the only real vital interest a man nominated by any cross-Channel railway company could have here, was the maintenance, and the increase, where possible, of through rates. Anybody who has any experience of the export business to England knows that that has been a standing grievance. The idea of putting a director nominated by a cross-Channel company on a railway here, and to do so by Act of Parliament passed here, is sheer lunacy, if we are to have regard to the interests of this country. After all, the railways are being given a monopoly of rendering services to the community, and to carry out vital services, and if nothing else was done beyond repealing the Railways (Directorate) Act this Bill would be worth supporting. I am very pleased that it is being ended. If there were any question of money involved, in my view it would be better to pay that money. 3 Whether that money is due or not, I do not know. In any case, it is a very wise procedure that that is being ended.
Mr. Counihan: I cannot see any reason why the G.S.R. Company should not cut adrift from the influence of other railway companies. They have a monopoly in this country, so far as railways are concerned. We have had rather sad experiences of the influence of British railway companies. Whenever we had reason to make complaints to the Great Southern Railways and asked to have some grievances rectified we were referred to a combined British and Irish Railway Conference. The G.S.R., apparently, were not their own masters at that conference. A decision was arrived at by the majority of the representatives at that conference. I may say that the bulk of the representatives were British—foreign. For that reason I object to any outside influence guiding the destinies of the Great Southern Railways.
On another occasion when we were trying to get a shipping company established, when we were charged exorbitant rates by the existing shipping combine, I put up a proposal on behalf of the cattle trade to the Great Southern Railways Company. The then Chairman thought there was a good deal in the idea. He was very much enamoured with it and at his request I committed my ideas to writing. The proposal was considered by the directors. The director of the L.M.S. Company thought it might in some way injure the traffic with which he was concerned and the proposal was turned down. I do not think there is much hope of development of the Great Southern Railways Company until it is prepared to stand on its own legs and get rid of all except national influence.
Sir John Keane: I think it is a great pity this matter is not looked at more calmly. It should be viewed more as a business proposition rather than  from the point of view of national politics. There should not be such an atmosphere of suspicion aroused. This whole arrangement is based on a contract and endorsed by law, and from it I think there has been considerable advantage.
Sir John Keane: There is a sum of £100,000 lying out without interest and that might be called in if this Act is repealed. There are further advantages, I am informed, representing about £20,000 a year that also form part of the arrangement. I do not think it is fair to suggest that the presence of a nominee of an interlocking company, a company which continues to carry on transport and provides an outlet for our exports, a company with which good relations are essential to our well-being, is necessarily malign so far as this country is concerned. I should have thought the object of that company and their nominee would be to encourage all the trade they could. The more trade the better for everybody. I think that these aspersions on outside influence are rather discreditable to the other directors. After all, is it likely that one person out of ten, or whatever is the number, is going to have that great power of harm over the home company, that power of bad influence and that power of over-riding the majority of the board? I think the whole thing is fantastic and it is based on an unwarrantable suspicion.
I ask the House to look upon this matter purely as a businesslike arrangement. If it is not businesslike, have done with it; if it is businesslike, continue it. Let us break down these barriers of national prejudice. You cannot deal with trade in watertight compartments or merely in terms of States or national entities. I am not in favour of having a representative of an outside company on a home company unless there is something adequate given in return. I am informed that if this Act is repealed the Great Southern Railway Company becomes  liable for the payment of a substantial sum and will suffer the loss of substantial advantages. Whether that liability will be enforced is another matter. I would like to hear what the Minister has to say.
Mr. Johnson: Looking at this matter from the point of view Senator Sir John Keane suggests, that is, as a purely business matter, and not knowing very much about the details of the business arrangement between the London, Midland and Scottish and the Great Southern Railway, I ask myself why should it be the London, Midland and Scottish and not the Great Western Railway of England? A considerable portion of this country is as well served, so far as cross-Channel trade is concerned, by the Great Western Railway of England as by the London, Midland and Scottish. If a nominee of the London, Midland and Scottish on the directorate of the Great Southern Railway is as influential as the mover of this proposal represents, then I think it may well be that the interests of this country may be placed in a position second to that of the London, Midland and Scottish Railway. It may be quite right for Senator Sir John Keane to say that the directorate are not children and are not going to be overridden by one member who happens to be the nominee of the London, Midland and Scottish; but according to Senator Moran, that person is emphatically the effective element in the directorate.
Mr. Johnson: By merit, yes, but nevertheless his merit is great enough to affect the general policy of the company. Even by merit he overrides the demerit of the rest of the directorate. The fact that that person who possesses great merit and, therefore, great power, is a nominee of the London Midland and Scottish, inevitably will tend to ensure that traffic will go via the London, Midland and Scottish rather than via the Great Western Railway of England. As a matter of pure business I think that the question to be asked is: which will serve the interests of this country better, the London, Midland and Scottish Railway  or the Great Western Railway of England? They at least should be put on level terms. But they are not with this Act on the Statute Book. The London, Midland and Scottish representative is a man of great merit. He has by his very merit such immense power as the nominee of the London, Midland and Scottish that therefore he can influence the policy of the Great Southern Railways in the direction of the London, Midland and Scottish, and away from the Great Western Railway of England. There is no business level term there and no equality there. That in itself is sufficient condemnation of this Act remaining on the Statute Book at present. What the cost of the removing by this Act may be I do not know but it would have to be a very high cost indeed to warrant the continuation of that policy.
Mr. Dowdall: Senator Sir John Keane spoke, as he always does, with sincerity and in good faith, but I would seriously ask the Senator to get into touch with any qualified railwayman and to get from him what goes on at the conferences at which through rates are fixed. It would be a revelation to Senator Sir John Keane to know what, and if he had that experience I am perfectly sure, knowing him as I do, that he would not stand behind this amendment. I will just give one slight example of this and the matter of through rates. Condensed milk was made in Limerick and the company that made that had a very high reputation for one particular kind, which was handled by an organisation in London known as The Pool. When it went out of business and discontinued supplying there was a prospect of a series of factories being set going again. The Pool decided that they would get a supply of condensed milk from Italy, and to sell it under the price at which the Irish article was sold in London. When the relative distance from Italy to London and Limerick to London is considered, and the number of countries and railways it had to pass through, one is surprised to be told that the rate on that condensed milk from Italy to London was slightly  cheaper than the rate from Limerick to London. That is only one example I wish to suggest to the House. As I said before, when that Railways (Directorate) Bill was introduced, the London, Midland and Scottish could have no interest in this country beyond the maintenance of through rates. While I cast no aspersion on the character of the London, Midland and Scottish nominee on the Great Southern Railway, I must say that I am satisfied he is only there in one interest, and that is in the interest of the London, Midland and Scottish Company.
Mr. Comyn: I oppose this amendment on principle. I do not think that any monetary consideration should influence us so as to allow a representative of a foreign company to influence the policy of a railway company in this country. No matter how excellent the man may be, and, indeed, I agree that the representative of the British company is a man of great experience and great ability, I would oppose the arrangement. The more ability that representative has the more likely he will be to influence the policy of our railway directorate in the interests of the company which he is employed to represent. Senator Johnson has made the point that if the London, Midland and Scottish Railway is to have an influence on our railways why should not the Great Western?
Mr. Comyn: Would we sell the control of transport of this country to any foreign country for its own advantage on the payment of £100,000? Surely we would not. Therefore, I am against that Act and against the amendment. I am against it on principle, and I ask Senator Sir John Keane this question—what about reciprocity — would the London, Midland and Scottish accept from us a representative of our railways on their board so as to influence the policy of that great railway in giving any favour to Ireland? I wonder what  would Senator Sir John Keane say to that? I observe he is silent now. He sees, of course, that what is good enough for Ireland cannot be thought of in relation to the sister island. I repeat I am opposed to this on principle. No money consideration would induce me, for one, to vote in favour of allowing the policy of our railways to be directed in the interests of any foreign combination no matter what it was. I ask Senator Sir John Keane again to put it to the test of reciprocity. Are we to get an influence in the control of the London, Midland and Scottish Railway in the interests of Ireland?
Mr. Foran: I can go a long way with Senator Moran in respect for the individual concerned in this matter. I have a long experience of him and, personally, I have a great admiration for his ability, but that is not going to influence me in connection with the amendment nor with the company he represents on the Great Southern Railways. Senator Sir John Keane told us of the very great concern for the development of this country and the trade of this country that that company has. I give one instance as to that concern. At one time, the mails were carried by the City of Dublin Steamship Company, an Irish company. The London, Midland and Scottish Railway Company came along and took over this work and cut out the City of Dublin Company. At that time there was an understanding and agreement that at least 50 per cent. of the employees on these mail boats would be Irishmen.
The London, Midland and Scottish took it over, and what is the position to-day? You can count on the fingers of your two hands the number of Irishmen employed on these ships. So much for the talk about that influence. In the nomination we have certainly a very able nominee put on the Board of the Great Southern Railways, but I am not convinced at all that his company is very much concerned with Irish development, and with that example before me that I have given I am certainly going to vote against  this amendment here. I know a number of the men who are employed on these steamers. I know what their conditions were formerly and what they are to-day. Their conditions are very much worsened since they were taken over by the London, Midland and Scottish Railway Company. Their job has been made more difficult. The men who have their homes here are for all practical purposes domiciled in Holyhead. I could recite many more instances of their alleged interest in Irish affairs on these lines, but I do not want to take up the time of the House. I have given, perhaps, enough instances, and I am going to vote against the amendment and the principle in the amendment.
Mr. Lemass: I would like to say here, as I said in the Dáil, that the decision to repeal the Railways (Directorate) Act, 1924, was taken without regard to the personality of the London, Midland and Scottish director on the Great Southern Railways Board. The same decision would have been taken no matter who that nominee was. For the particular individual in question, I myself have considerable admiration. I have great respect for his administrative and combative abilities. But they do not come into this question at all. The question is whether we are to have on the Board of the Great Southern Railways a person nominated by a non-Saorstát railway. I do not think we can possibly judge this question fairly without having an outline of the history of the events which led up to the present position. It is clear that a number of those who have spoken in this discussion have been misled about the present position by failing to refer to the history of the events which produced it. Over 30 years ago the Dublin, Wicklow and Wexford Railway made an agreement with the London and North Western Railway Company, which since became the London, Midland and Scottish Railway Company.
The line was built from Waterford to New Ross—the New Ross and  Waterford extension line. The building of that line was of very considerable advantage to the London, Midland and Scottish Company. It secured that the traffic which might otherwise have gone by the Great Western railway system in Great Britain was secured for the London, Midland and Scottish Company. At that time the Great Southern and Western Railway Company had an arrangement by which all unconsigned traffic entrusted to them went via the Great Western system. I do not know whether that arrangement persists. In any event, I do not believe it is necessary now, as the London, Midland and Scottish Company and the Great Western Company have a pooling arrangement by which they divide between them the proceeds of any through rates. That, of course, to a large extent offsets Senator Johnson's consideration. That pooling arrangement was only recently arrived at. So long as it exists, I suppose it doesn't make much difference whether the traffic passes via the London, Midland and Scottish or the Great Western.
Mr. Lemass: Quite. The agreement made at the time involved a loan of £100,000 by the London, Midland and Scottish Company to the Dublin South-Eastern Company for the construction of the line. That loan was given on these conditions: The Irish company, as it was called in the agreement, could repay the loan only if interest upon it had been paid for five years previously. The English company could require repayment of the loan on six month's notice. I am aware that another interpretation of the agreement is possible and certain people have put another interpretation upon it. But when anyone examines it, bearing in mind that persons do not draw up an agreement except for the purpose of conveying a definite idea, and not for the purpose of tying themselves up in legal knots, and that in all these documents the commonsense interpretation is usually the proper legal interpretation, it seems  to me that the interpretation I have given is obviously the correct one. On the other hand, the Irish company agreed to procure the election to its Board of one of its own shareholders nominated by the London, Midland and Scottish Company. I want that particular point emphasised. There was no agreement on the part of the Irish company to put upon its Board a person nominated by the London, Midland and Scottish Company. The Irish company agreed to procure the election of a duly qualified person, satisfactory to them, who was nominated by the London, Midland and Scottish Company at that time. The working between the Dublin and South-Eastern Company and the London, Midland and Scottish Company was very close at that time and very beneficial to both, particularly to the London, Midland and Scottish Company.
That arrangement persisted until 1924, when the amalgamation of railways in the Saorstát was effected. By the amalgamation all the railways in the Saorstát were amalgamated into one company and the liabilities and assets of the separate concerns became liabilities and assets of the new amalgamated company. What was the position of the agreement when that amalgamation was effected? The liability to repay the £100,000 to the London, Midland and Scottish Company on six months' notice from that company, or on the initiative of the Irish company if interest had been paid for five years previously, was transferred, and that liability became a liability of the Great Southern Railways Company. On the other hand, the Great Southern Railways Company could not carry out the other part of the agreement. It could not procure the election to the Board of the Dublin South-Eastern Company of a person duly qualified to act in that capacity, having regard to the fact that that Board had been abolished. The agreement, therefore, in 1924 would appear to have become inoperative and, no doubt, in that year the London, Midland and Scottish Company, if they so desired, could have pressed for the repayment of the  £100,000, the amount of the original loan. I want to emphasise that of course they could have pressed for it at any time from the date on which the loan was made. All the agreement necessitated was the giving of six months' notice to the Irish company. They did not, however, do it since 1924. In that year the Railways (Directorate) Act was passed.
I am not in a position to state authoritatively the motives which inspired the Government then in office to introduce that Act. A careful study of the Act does not reveal the motives that were behind its introduction, or even the speeches which were delivered by Ministers in justification of it do not give a clear picture of what the position was. Nor have I been able to find in the records of the Department any documents which would indicate the events which led up to the introduction of that Act. Certain documents are there, but they do not tell the whole story. That Act, however, did not purport to give effect to the agreement of twenty years previously. It did not have any direct relation to that old agreement. It was the result of certain discussions which apparently had taken place in 1924, having regard to the circumstances of 1924. It gave to the London, Midland and Scottish Company the right to put a director upon the Board of the Great Southern Railways Company. It is clear that the right given to the London, Midland and Scottish Company to put a director upon the Board of the Great Southern Railways Company was an entirely different thing from that enjoyed by the London, Midland and Scottish Company under the old agreement, which involved the action by the Dublin South-Eastern Board to procure the election of a person duly qualified—that is, a shareholder of the Irish company approved of and nominated by the English company.
It is quite clear, and should have been clear in 1924, that the agreement of 20 years previously, entered into between a minor Irish company and the English company, and involving the nomination of a  person on the Board of the Irish company, in consideration for certain concessions given to the other company, and resulting out of the very close and intimate working that existed between them, could not be, and should not have been, advanced as a reason why the same English company should be given that right to put a director upon the Board of the company that was going to control all the railways of the Free State. That action was taken. It was taken in spite of considerable opposition both in the Dáil and the Seanad and in other quarters, and the position in that respect has continued since then. That position is this: the London, Midland and Scottish Company nominated its director to the Board of the Great Southern Railways Company. That director continued to act there in whatever manner he thought fit. The London, Midland and Scottish Company was entitled to demand a repayment of the loan of £100,000 on six months' notice any time between 1924 and this date. The Great Southern Railways Company could have repaid that loan at any time if they had paid interest for five years previously.
The agreement expired somewhere about the beginning of this year. I do not think that makes very much difference in the position. It had a 30 years' life which ended about the beginning of this year. If it made any alteration in the position, it merely eliminated the necessity for giving six months' notice by the English Company in order to procure the return of the £100,000, if they wanted it.
Now we are going further than the Railways Acts of 1924. We are going to make the Great Southern Board not merely a Board that will control all the railways of the Saorstát but also all the transport of the Saorstát. Is it seriously contended that an agreement made 30 years ago between a minor Irish railway company and an English company in the interests of that minor Irish company should be appealed to to-day in order to secure for the English company a right to put a director, one in seven, on the Board that is going to control the transport of the Saorstát — rail and road transport  as well? I think it is a preposterous contention and I do not know on what ground it could be defended. I should say that recently I had an opportunity of meeting the Chairman of the London, Midland and Scottish Company and I found that he was not inclined to put forward that contention or to rely upon it. I am quite certain that any reasonable person would see the preposterous nature of an argument of that kind. The position following the repeal of this Act, the Railways (Directorate) Act, will be the position that existed before the Act passed. I think that is clear.
The position before the Act was passed was that a liability had been transferred from the Dublin South-Eastern Company to the Amalgamated Company, the Great Southern Railways Company. Certain obligations under the agreement had also been transferred but these obligations could not be given effect to. It was a case then for discussion between the Great Southern Railways Company and the London, Midland and Scottish Company as to the position of both under that agreement and that is the position to-day. I understand these discussions are about to take place. What the results of these discussions will be or what arrangement may be made between the two companies is a matter for them, not a matter for us. One thing clear is this that we do not propose to force on the Great Southern Railways Company a director nominated by the London, Midland and Scottish Company or even to confer that right on the London, Midland and Scottish Company at the request of the Great Southern Railways Company in the changed circumstances now existing, merely because the Dublin South Eastern Company some 30 years ago thought fit to make this agreement. One cannot say whether if there had been an Irish Government in existence at that time the Dublin South-Eastern Company would have been permitted to make that agreement but it is quite clear that the agreement they made was something altogether different to the Railways (Directorate) Act. It was something which they were entitled to make in law, binding them to do certain  things which they were free in law to do, and something which the Great Southern Railways Company is quite free to do in law if it so wishes.
If the owners of the Great Southern Railways Company think fit to enter into an arrangement by which they will bind themselves to elect anybody on their board, provided that person is qualified in every respect to be a member of the Board, there is nothing in any statute to prevent them doing so. Before the Great Southern Railways Company might consider availing of its position in that regard I think it should satisfy itself that it is getting some concession and that it is the right thing to do. I am told that not alone is there a sum of £100,000 involved but that the Great Southern Railways Company derives an advantage estimated at £20,000 because of the agreement with the London, Midland and Scottish. I have asked in the Dáil, I have asked the Great Southern Railways and the Chairman of the London, Midland and Scottish how that sum was arrived at, what were the items that formed it, and I have never been able to get a clear answer. I do not believe it and until there is proof to the contrary I shall continue to disbelieve that the Great Southern Railways Company is getting any advantage of the kind out of the agreement. I think if there are to be any discussions between the Great Southern Railways Company and the London, Midland and Scottish Company arising out of the agreement, that the Great Southern Railways Company should be satisfied that it is really getting an advantage of that kind before it accepts the word of an English company for it, even if the English company are prepared to assert it in the absence of proof.
The position is that the agreement in so far as the transfer of liability to the Great Southern Railway Company is concerned still exists and in that connection discussions will have to take place and are about to take place between the two companies concerned. It is not a matter for us. I would remind Senators that the Chairman of the Great Southern Board at the recent meeting of the Company stated  that his Company did not ask to have a L.M.S. director placed on their Board, but were compelled to take one. Any arrangement to be entered into in future should be entered into freely by the Great Southern Railways Company and not made obligatory on them by Act of Parliament. I do not think it is right that we should have on the Board of a company to which we are entrusting practically a monopoly of transport in the Saorstát, one director in seven nominated by a foreign company whose chief concern will be the welfare of that foreign company. Our Board should be one actuated with the sole purpose of making its own undertaking a success and if there is to be any arrangement between this company and companies in Great Britain or elsewhere, this arrangement can be effected, probably to the mutual advantage of both parties, without giving any measure of control in respect of transport affairs here to any outside company.
Mr. Johnson: I should like to ask the Minister to make clear a point that is raised by certain sentences in his speech. He said that in future the company, if it wishes, can make arrangements with the London, Midland and Scottish or any other railway company in regard to its directorate. That might be taken as an invitation to the London, Midland and Scottish Company to make terms whereby they  would get the actual control of the policy of the Great Southern Railways in this country. That is a possibility that I certainly do not think should go out as a hint or as a line of policy that would prove acceptable to this country. It is well that I think it should not be allowed to pass without notice. I think it might very well be taken as an indication of a line of policy which they might take to overcome the repeal of this Directorate Act. I am sure the Minister did not intend to hint to the company that they might evade the purposes of this section by doing that. I should not like it to be thought as a possible line of policy which would prove of advantage to this country.
Mr. Comyn: I should like to say in support of what Senator Johnson has said that the agreement between the London North-Western Company and the small company which the Minister referred to in reference to the appointment of a director, was an agreement which became by Act of Parliament impossible of performance and was therefore void on the passing of the Amalgamation Act. The London, Midland and Scottish Company has now no legal or moral right to rely upon that agreement. I must say that I think Senator Johnson has expressed the general feeling in this country when he indicates that no encouragement should be given to the Great Southern Railways Company to make any agreement to elect a nominee of the London, Midland and Scottish on the Board of the Irish railways.
Mr. Lemass: May I say I was explaining the legal position? There was no legal barrier to the Dublin South-Eastern making an agreement thirty years ago. In that respect the law is unchanged. I would like to think that if the Great Southern Railway proposed to enter into such an agreement they would do so having full regard to the important concession they were giving, and to the value they were getting in exchange as well as the policy of the Government. My contention, which I pressed at some length, was that on the one hand the Great Southern are not getting out of the pre-existing arrangement any great advantage and, on the other hand, I  would be surprised if the London, Midland and Scottish attach the slightest importance to having a director on the Great Southern Board.
(2) Upon the application of the company the Railway Tribunal shall ascertain the amount of the loss sustained in any year by the company as a consequence of the repeal effected by the foregoing sub-section.
We have got a good deal, here, of what we do not get anywhere else outside this House, that is free legal opinion. Interesting as it may be, it is not very convincing. There is no doubt, I admit, as to the legal liability of the Great Southern Company in the event of their nominee having to be withdrawn by the London, Midland and Scottish. Senator Comyn does not believe that there is any legal liability. I think the Minister is doubtful whether there is any legal liability, but the company is advised that there is. Under these circumstances is it not only reasonable for the Government to indemnify the company against any claim that may be made in the courts? The Minister could help me very much in this matter if he told me all he knew. He admitted having conversation with the chairman of the London, Midland and Scottish, and I can hardly believe that this whole matter was not discussed. The question of a director was discussed and I can hardly believe that the other question, with the corresponding question of liability, was not also discussed. If the Minister can tell me that he has even reason to believe that the London, Midland and Scottish would not sue for any breach  of agreement arising, out of this Directorate Act, I think I should be satisfied, and the company would be satisfied. In the absence of any such specific assurance from the Minister, I think it is only fair, considering that we are here passing all this legislation as relief for the railway companies, to help them to keep on their feet, that the State should indemnify the company from any claim that may be made against it in the courts.
With regard to the concessions, the Minister doubts they have any value. I am unable to say what value they have. But I have the list of them, and the Minister has seen that list. The company was in a position to keep accounts, as to what they were worth, and the amendment says that the Railway Tribunal shall ascertain the amount of the loss sustained in any year by the company as a consequence of the repeal effected, and then the State would be asked to make good that amount. That is all I need say.
Mr. Lemass: I want to put this case to the Seanad as if the worst possible interpretation could be put upon the agreement. Let us assume the company is going to lose £100,000; that as a result of this Bill, when it becomes an Act, and also as a result of the Railway Act of 1924, the Great Southern Railways has to pay £100,000 to the London, Midland and Scottish. Is that any reason why the State should pay the money? If a company made a bad agreement thirty years ago, why should the taxpayers have to pay for it?
Mr. Lemass: If, at any time between 1903 and 1923, the Dublin South Eastern Railway decided to issue debenture stock or in some other way undertook to meet the loan by the London, Midland and Scottish, the liability of the company, in respect of the new loan, would be transferred to the Great Southern, and would be its liability to-day. I want to know why this loan, if there was a loan, should be made good by the taxpayers? Until that case is met I do not think it necessary to argue it any further. But I say this much further. Let us assume  the position is not as clear as that, and that there is doubt whether the money is due, or whether the London, Midland and Scottish ought to be repaid that money. I suggest to the Seanad that the one way of making certain that the Great Southern Railway Company will fight its corner properly, and will not give away its concessions is to make them defend their own hand, and not by giving them a promise to indemnify them in any loss they may incur. If there is to be a discussion it is for the Great Southern Railway Company to make sure that if they give any concessions they must get payment in return; that they must get the best of the bargain, and that the company will not pay a halfpenny unless it owes the money, and consequently, cannot get out of paying it. I suggest seriously that to accept this amendment is really to invite the Great Southern Railway not to bother its head about the matter but to give the London, Midland and Scottish just what it asks.
Mr. Jameson: If the Minister agreed with Senator Comyn that the London, Midland and Scottish have no right to recover this money, then the Minister would be quite right in his attitude. But the Minister seems to say that they may have a right to recover the money and that the only way to make a better fight is to make the Great Southern Railways fight for their own skin and not pay. I would like, before entering into a scrap, to get a guarantee that if I do my best, and use every legal remedy to avoid paying, then, that if I should lose in spite of doing my best, the State will pay my costs. That is all this amendment of Senator Sir John Keane means. I think it is rather hard not to trust the railway company to defend the suit. I believe they will do so to the best of their ability. But if they do their best they should be given a guarantee that if the action taken against them succeeds, they should not be compelled to pay the money. If there is any justice in the law, which, I suppose, Senator Comyn will admit, they will have a verdict against them of  a lawful nature, and they will only be paying a legal liability for which they became liable because of this Act. If that state of affairs arises, I do think that the State which puts that liability on them ought to stand behind them and pay them. This is a measure not for the railway company alone. This measure is also put forward because we all believe that we should keep that railway company, and that the time has not arrived to scrap it. Knowing that, the State should recognise that it has some liability, and I think that Senator Sir John Keane's amendment meets the case. I think that the Minister ought to consider seriously whether he could not in some way or another get some sort of understanding on the matter. He may call the tune as much as he likes, and see how much the railway company ought to pay, but if the company is beaten in an action I think the State should bear the loss, where the loss has been due entirely to the action of the State.
Mr. Lemass: Even if the £100,000 has to be paid, I still maintain that it is not due to the action of the State. It appears that it was due to be paid at six months' notice, at any time from which the notice was given, and whatever doubt there was about that was obviously removed by the fact that the agreement itself terminated in January of this year. The agreement was for 30 years, and after January of this year the liability of the company to pay whatever that liability may have been, became a liability to pay on demand. That was the position, and that will continue to be the position, whether this Act is repealed or not. The London, Midland and Scottish Company may not insist on repayment. But if they are going to insist upon whatever legal claim they may have now, there is no reason to assume that they would not follow precisely the same course if this Bill had never been introduced. This is shown as a liability on the accounts of the company and if they have to meet it it is not in consequence of any action we are taking.
Mr. Jameson: I should like to ask the Minister, can that be quite right?  They have never meddled so far, as long as they had a director on the Board, and judging from past experience, if he was left there, there would be no question of the London, Midland and Scottish Company taking any proceedings whatever. It is because of his removal that one can see the London, Midland and Scottish Company taking action, and the director is removed by an Act of the State.
Cathaoirleach: I should like to ask the Senator, is their legal right injured in any way? Is their legal position worsened by this Act in any way? Have they not still the legal right to claim the £100,000?
Mr. Jameson: I cannot argue the legal position. I am only arguing that the taking away of their right to have a director on the Board will tend to make the London, Midland and Scottish Company take action.
Sir John Keane: I cannot help feeling that in this discussion there is more of legal subtlety or legal sophistry than of plain commonsense. My point is that by the repeal of this Railways (Directorate) Act there is a definite breach of contract which enables the company to sue for and demand the payment of this £100,000, and, if the Great Southern Company refuses to pay, to take whatever steps the law allows to recover the money; and which enables it also, owing to this breach of agreement, to withdraw the concessions which the railway company value at £20,000 a year.
Pursuing this point, if I may, for one moment, I hold in my hand the Railways (Directorate) Act, 1924, in which the matter is stated in extraordinary terms, and I suggest in quite different terms from those of an ordinary Act of Parliament. It begins: “Whereas,” and then recites the history of how that agreement was made in 1904 between the London and North-Western Railway Company and the Dublin, Wicklow and Wexford Railway Company, giving them the right to nominate a director and goes on to say that by reason of certain concessions, allowances, and advantages being granted the right to nominate a director cannot be conferred on the London,  Midland and Scottish Railway Company without the authority of Parliament and hereby gives that authority. I am sure that Senator Comyn, with his legal acumen will tear that to pieces; but as a layman it seems to me that the whole thing was interlocked in return for the £100,000 originally given, which conferred the right to nominate a director. The right to nominate a director in return for these concessions is continued by this Act and when the State steps in and deprives one party of the right to nominate, I, as a layman, would say that there was a breach of contract. That may be a matter for the courts and all we ask is that, if the company has to foot the bill on account of the repeal of the Railways (Directorate) Act, 1924, the State should make good the loss. I think that is only fair and equitable.
Mr. Comyn: On a matter of law I do not like to be misquoted. What I said was that the original agreement, whereby the Irish company undertook to put on their directorate a nominee of the London and North-Western Railway Company, became impossible of performance long before 1924 and was, therefore, of no effect. Now, that I am right is proved by the preamble which Senator Sir John Keane has quoted, because he says, referring to what had taken place in previous years that the preamble goes on to say: “And whereas this matter cannot be done without the consent of Parliament”—that is, without an Act of Parliament—which proves conclusively that what I said originally was quite correct. I said nothing at all about £100,000.
Mr. Johnson: With regard to the Railways (Directorate) Act of 1924 and the preamble, I would just point out that, while the right is conferred by the Act, that is to say the new company—the Great Southern Railways Company—is empowered by the Act to perform certain things, the agreement entered into between that company and the London, Midland and Scottish Railway Company was not in reference to the £100,000 at all; it was in reference to certain concessions, allowances and advantages, including special proportions in division of receipts and so  on; but it had no reference to a loan of £100,000.
Sir John Keane: I do not think the Minister is reasonable in this debate. He is trying to involve me in the necessity of proving something which is quite impossible to prove and is only a matter of opinion. The only test for it is the law courts and if this matter goes to the courts and if, owing to what Parliament does under this Bill, the company suffers loss, I think the State should bear that loss.
Mr. Lemass: I was merely supporting what Senator Johnson had said: that the agreement referred to in the preamble of the Railways (Directorate) Act, 1924 is an agreement made in 1924 between the Great Southern Railways and the London, Midland and Scottish: an agreement which has relation to these “concessions, allowances and advantages” stated to have been given before 1924 to the old Dublin and South-Eastern Railway Company and to be continued under the agreement for the benefit of the Great Southern Railways. I do not know if, in 1924, those responsible took it for granted that “concessions, allowances and advantages” were in fact being given, or if anybody has taken the trouble to ascertain whether the “concessions, allowances and advantages” were in such a form that the change in circumstances between 1924 and 1933 has wiped them out. I do know that when I endeavoured to ascertain what the concessions were and how this figure of £20,000 was arrived at, I could not get any satisfactory explanation. Certain lists of figures were given me which did not seem capable of bearing examination as representing concessions to the extent of £20,000. I suggest, again, in this matter that if the Great Southern Railways are enjoying concessions to the extent of £20,000 a year they should be able to say how without asking the London, Midland and Scottish.
|Bigger, Sir Edward Coey.
Browne, Miss Kathleen.
Douglas, James G.
Griffith, Sir John Purser.
|Jameson, Right Hon. Andrew.
Keane, Sir John.
|Chléirigh, Caitlín Bean Uí.
Comyn, K.C., Michael.
Counihan, John C.
Robinson, David L.
Tellers:—Tá: Senators Sir John Keane and James Moran; Níl: Senators D.L. and S. Robinson.
 Amendment declared lost.
Section 15 agreed to.
Mr. Jameson: Senator Brown has an amendment down to Section 15, but he is laid up and unable to be here. The amendment seems to me to deal with the same point as that dealt with by Senator Sir John Keane, and I think the Minister more or less promised to consider it on Report Stage.
Cathaoirleach: We might adjourn it for Report.
Amendment adjourned for Report Stage.
Sir John Keane: When I put down this amendment, or when this amendment was put down, which is the more accurate way of putting it—I do not wish to disclaim responsibility for it— insufficient regard was had to the full  effect of this legislation. The amendment is:—
New section. Before Section 16 to insert a new section as follows:—
16. No railway hereditament shall be rateable in respect of that portion of the Poor Rate which is or is to be raised for the purpose of construction and maintenance of roads.
In view of the fact that we will ultimately work into a position of unified transport, where the identity of railways will merge in that of roads, I do not think it is reasonable to ask that any portion of the unified system should be relieved of its proper share of rates. I, therefore, propose to withdraw the amendment.
Amendment, by leave, withdrawn.
Amendment 37 not moved.
Section 16 agreed to.
|Denomination of Stock||Amount of existing Capital Stock||Amount of reduced Capital Stock||Amount of which £100 of existing Capital Stock is reduced|
|4 per cent. Debenture Stock||8,323,797||7,075,228||85|
|4 per cent. Guaranteed Preference Stock||3,885,374||1,942,687||50|
|4 per cent. Preference Stock||5,068,464||1,773,963||35|
|North Wall Extension Lines 1 and 2 £100 Shares||126,800||12,680||10|
|4 per cent. New Ross and Waterford Extension Railways Guaranteed Stock||100,000||50,000||50|
|4 per cent. City of Dublin Junction Railways Debenture Stock, 1884 and 1887||100,000||85,000||85|
|4 per cent. City of Dublin Junction Railways Debenture Stock, 1894 and 1897||30,230||25,696||85|
|4 per cent. City of Dublin Junction Railways Preference Stock||50,000||17,500||35|
|4 per cent. City of Dublin Junction Railways Guaranteed Stock||225,000||112,500||50|
|City of Dublin Junction Railways Unguaranteed Stock, 1884 and 1887||25,000||2,500||10|
Sir John Keane: I move amendment 38:—
First Schedule. To delete the Schedule.
This is consequential on amendment No. 4.
Mr. Douglas: In connection with this consequential amendment, I should like to say that I am of the opinion that some of the amendments to Section 3, passed by the House yesterday, were passed because a number of Senators approved of the principle, without full consideration of what the exact effect of passing them would be. Although I voted for them myself, I have given further consideration to the matter and I am of the opinion that the House ought to get an opportunity of again considering those amendments. I intend, with your leave, when the Report Stage is reached, to ask the House to recommit the Bill for the purpose of reconsidering it, and more particularly, in connection with the amendments to Section 3. I think it is no harm to state that now, and, in view of that, it might be well to leave this over until the Bill is recommitted, because it can then be dealt with in accordance with the ultimate decision in regard to the other amendments.
Cathaoirleach: I think that is a very good course to take because, as Senator Douglas has said, the Bill will probably be recommitted and each particular amendment may be pertinent to the Bill or it may not.
Amendments 38 to 43 inclusive adjourned for Report Stage.
Bill reported to the House.
Report Stage ordered for Wednesday, 31st May.
Cathaoirleach: On Wednesday next, we will have the Road Transport Bill on Report, the Railways Bill on Report and the Road Traffic Bill in Committee. We are not likely to have any other business.
Mr. Douglas: If, on next Wednesday, I move as suggested, will it be  possible to proceed with the Report Stage on the same day?
Cathaoirleach: I am sure the House will agree to do so.
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