Wednesday, 25 March 1953
Seanad Éireann Debate
Mr. McHugh: Before the Adjournment I was referring to the Government's saving campaign and I propose to limit myself on that subject to putting two questions to the Minister. If the State taxes the people to a higher degree, how can the people possibly save, and if they are further taxed in higher prices for food and essential commodities, how can they save? At the moment we have approximately 90,000 unemployed in this country according to the recent figures issued by the Statistics Office. Yet at this particular time we find that the Government appears to be concerned in providing money, not for the relief of unemployment but for the purpose of buying horses and obsolete aeroplanes. It is amazing how any Government can justify the purchase of horses and aeroplanes and still be unable to provide money for human beings.
At the moment in my own town of Ennis there are queues for the labour exchange. We find that there are more unemployed there than ever before. It is true that a little employment is being given outside the town by one Department of State—the Department of Posts and Telegraphs—at what has been described as starvation wages. They are offering married men with families who are paying high rates for council houses the noble sum of  £4 2s. 6d. a week. Yet at a time when we have people unemployed in Ennis and elsewhere we find the Government embarking on a policy for the purchase of horses at fabulous prices, one of which cost around £250,000, and to purchase obsolete aeroplanes in the region of thousands and probably millions of pounds.
A short time ago we passed through this House a Bill called “The Undeveloped Areas Bill.” This Bill was supposed to benefit the West of Ireland to a considerable extent. We in Clare looked forward to our share of the benefit from that Bill. We were glad to read shortly after the passage of the Bill through this House that the Parliamentary Secretary to the Government was to visit Clare with a view to seeing what could be done for the people of Clare under that Bill. He came down to a meeting of the Clare County Council and all the public representatives who are not members of the council were invited to attend. I was included in that category. We were informed at the meeting that Mr. Lynch, the Parliamentary Secretary, was there to see what could be done and we were prepared to help him in any way we could to do something for the people of Clare. We were amazed to find that Mr. Lynch had nothing to say to the people. He preferred, first of all, to hear the views of the council on the problems confronting the people, and, having heard the council, he proceeded to repeat that he had nothing to say and no solution to the problems of the people of the county. He told the meeting that he would return to Dublin and would go into the matters in his Department. He also promised that he would return particularly to West Clare to examine further the problem. To our further amazement we have not heard since from the Parliamentary Secretary about his original visit to Ennis or as to his second promised visit to West Clare. The people of West Clare in particular are beginning to wonder what has become of the marvellous plans instituted by the Government to settle all the problems of the undeveloped areas.
So far as we are concerned, these  problems remain unsolved and untouched. I cannot help contrasting that treatment by this Government with the treatment shown to Clare by the inter-Party Government. The people of West Clare had a problem which had been in existence for years under the previous Fianna Fáil Government. They appealed to the inter-Party Government for help in dealing with that problem of the incidence of parasitic disease in West Clare peninsula. Within six months of that appeal having been made to the inter-Party Government, that problem, which in a number of years had resulted in the deaths of thousands of cattle, had been completely wiped out. I cannot help contrasting that type of effort for the undeveloped areas with the efforts of the present Government which alleges that they are spending more money in schemes for the development and betterment of the undeveloped areas.
In referring to the action of the inter-Party Government at that time, I feel I should mention the then Minister for Agriculture Deputy James Dillon and his efforts to help the people of the County of Clare. Many hundreds of acres have been reclaimed under the land project in Clare and many hundreds more remain to be reclaimed. We find that the Government at the moment are considering the sale, and I understand have in fact put up for sale, a considerable quantity of heavy machinery which had been put into Clare under that land project. I understand that they are going to sell one tractor, one drainage plough, one excavator, a big wheel tractor, a tiller and rotovator, all machinery which would help the people of Clare and which we were glad to see being brought into the county. It is now being removed by Government policy and we are told by the Minister for Agriculture that such a step will help to reclaim the land faster and quicker.
Mr. McHugh: It might be possibly at less cost but that remains to be seen. It certainly will mean reclamation of land with less labour. Speaking in the Dáil on 12th March, Deputy  Briscoe is reported as saying, Volume 2 of Dáil Debates, column 363:—
“The numbers of calves slaughered at cattle slaughtering premises registered for export purposes under the Agricultural Produce (Fresh Meat) Acts during each of the years 1945 to 1952 inclusive, were as follows: 1945, 36,533; 1946, 29,738; 1947, 49,790,”
I wonder if Deputy Briscoe or any spokesman of the present Government, would be able to say that we would have had a big meat-producing industry, canning meat and exporting carcase meat, had it not been for the action of the inter-Party Government in 1948 in stopping the slaughter of calves. It would be very interesting to know what the position would be in that industry to-day but for the action of the Government of that time.
Many Senators referred to the position of local rates and one Senator, I think it was Senator Fearon, to the position existing at the moment due to the exhaustion of the Hospitals' Fund. I would like before I conclude to make a few remarks about that position. Two years ago I spent a few months in hospital, in a new hospital built ten years ago with the help of the Hospitals' Fund. I discovered to my amazement that in a hospital barely occupied for ten years the authorities at the time of my admission were building a new stack to the boiler room and were also commencing to rewire the complete hospital. They were also building a new chapel, having torn down the one built ten years before, and had repaired practically every floor in the hospital, and in addition, had installed a new heating system for the nurses' home
 I was told at the time by an official in the hospital that according to his estimate it would have been cheaper to have torn down the hospital two years before and rebuilt it. That hospital had cost £80,000 and it had been built when the Fianna Fáil Government was in power. I am sure these conditions could not have existed anywhere else and, if that is a sample of local administration and a sample of how the Fianna Fáil Government built their hospitals, it is no wonder that the Hospitals' Fund is now exhausted. I am quite sure that the people responsible for hospitalisation must look at the future in despair, in view of the fact that no further fund appears to exist under the Hospitals' Sweepstakes for the building of new hospitals.
I will conclude my remarks by saying that if the Fianna Fáil Party can justify its existence as a Government on the figures which the Minister for Finance has presented to this House, they can justify anything.
Mr. O'Callaghan: I think it is necessary to say after some of the weary speeches we have heard that there is at least one bright spot in the country—we have largely increased the amount of tillage being carried out and that increased tillage is mainly in connection with beet and wheat growing. Coming from the heart of the country, I know that that is so because everywhere one looks one can see fields under tillage, fields never before tilled. We have also figures from the Sugar Company about the increased acreage of beet which they have contracted for.
Judging by the figures, I think we should be heading for an increase of 20 to 25 per cent. in the sugar production for the current year. If we in this country would grow all the beet and wheat we require, we would save moneys, amounting I think, to roughly £9,000,000 on wheat and in the neighbourhood of £5,000,000 on beet. If we could grow all the wheat and beet required—and there is no question that it cannot be done—it would help the Central Fund considerably and create a good deal of employment, a matter  which so many people are complaining of outside and in this House as well. I ought to say to the Opposition that we have in this House and elsewhere a number of people who are anti-wheat and anti-beet campaigners and that is a great pity. The Opposition should give a lead to the country and ought to suggest to their followers that the growing of beet and wheat is valuable work and of the greatest importance to the nation. If we put our shoulders to the wheel there is no reason why we would not save £14,000,000 for ourselves and the nation and give a good deal of increased employment into the bargain. I appeal to the other side of the House to do their bit in connection with these two items at least.
Senator McGee referred to motor-cars being plentiful outside our churches—motor-cars which were being mainly used by the people of rural Ireland. All the cars one sees at the churches do not belong to farmers, and if one visits, for example, a beet factory during the campaign season one will see a long line of motor-cars outside belonging to the unskilled workers and tradesmen of all kinds who have to travel long distances and use motor-cars on that account. I have information that many of the cars possessed by farmers are being bought on hire-purchase at a rate of interest which is about 9 per cent. per annum. That is a bad position and if the farmers could get more credit at an easier rate of interest it would help them considerably in manuring their lands and stocking their lands. I have no doubt that the country is badly in need of increased liming and increased artificial manuring and credit is necessary to do this.
The Irish Sugar Company have a good credit scheme whereby they allow a farmer about £20 per acre with which he can buy manures not only for beet but for some of his other crops as well. I think if that is being extended and taken up by the people interested in wheat—that if a similar scheme to that operated by the Sugar Company would be operated by the wheat millers—it would be very valuable to the countryside and it  would help to extend the acreage of wheat.
I think that Senator Ruane referred to the architects' fees in his county and he mentioned a figure that seemed to be amazing. If there is any ground for it, and if his statement is correct, it ought to be looked into. Perhaps it happens in other counties too, and if so it is a bit of a racket and ought to be stopped.
Senator McHugh referred to the dead meat trade and what the inter-Party Government did to increase the cattle of the country and the stopping of the slaughter of the calves. I take a different view altogether to the view he took. I think the calves were not slaughtered because it was found more valuable to rear them. I think that is what happened in connection with the calves. I think the farmers were shrewd enough. When they saw it would pay to rear the calves they undertook to rear them, and that was not exactly to help the meat factories so much but certainly it helped to increase the cattle population. That is what I have to say in connection with the matter.
Mr. O'Higgins: I am not quite clear what Senator O'Callaghan set out to prove, but it certainly was very meagre consolation to the Minister for Finance. He says that at the end of another 12 months of the Fianna Fáil Government there is only one bright spot in the country.
Mr. O'Higgins: There may or may not be a bright spot, but it seems to me to be a very poor consolation to the Minister for Finance that, after debating the Vote on Account in the Dáil, after discussing the Central Fund Bill here in the Seanad, the only grain of hope which those on his own side of the House can find is that there are one or possibly two bright spots in the country at the end of another 12 months of the Fianna Fáil Government.
I want to say that, accepting Senator O'Callaghan's definition of bright spots, I believe there is a third, and I intend dealing with that first, because it is the only matter on which I can find it within myself to compliment the Government or the Minister, and that is on the initiation of the recent publicity campaign in connection with savings. I think it is legitimate to doubt, as Senator McHugh doubts, as to whether or not, having regard to Government policy as a whole, there can be any reasonable prospect of such a drive succeeding at the present moment; but, as far as I am concerned —I want to say this quite clearly—I wish that drive every success and I hope it will succeed. It is the one semblance of sanity in the financial policy of the present Government.
Mr. O'Higgins: One more bright spot, and it does not go nearly far enough. It is not enough simply to have a publicity campaign—and may I say this, if the Government and Senator Hartnett thought this was a great idea born in the mind of the Minister for Finance or the Minister for Posts and Telegraphs it was no such thing. The idea of starting this campaign was the idea of the Leader of the Opposition who has, after 12 months, succeeded in kicking the Fianna Fáil Government into doing something about it.
Mr. Colgan: I only want to point out that savings campaigns are nothing new. I was encouraged when I was a boy to do it and every Minister, particularly the Minister for Posts and Telegraphs, has always been impressing on us the necessity to save.
Mr. O'Higgins: I know that. The difficulty is that while the Minister for Finance and the Minister for Posts and Telegraphs have been urging on the people the necessity to save the Minister for Industry and Commerce has been doing the exact opposite and has been urging the people to spend. That is one of the complaints I have made previously against this Government and make again. However, I want to say it is a bright spot. It is good to see them doing something about it. They are only doing something about it now because they have been kicked into it by the Leader of the Opposition. Over the last 12 or 18 months he has been calling the attention of the Minister for Finance of the Fianna Fáil Government to the necessity for doing something about this, and did at the Fine Gael Ard Fheis held in the Mansion House on the 17th and 18th of last month refer to the matter.
I am quoting now from the Irish Independent of February 19. “The Leader of the Opposition stated in his speech that savings must be the main source of progress and that two things were needed—firstly, to expand them. and, secondly, to see that they were properly invested. He recommended in connection with expanding savings that he would suggest the setting up of a central savings office which with the assistance of local bodies, trade unions, and groups like Muintir na Tíre, and Macra na Feirme would organise a great campaign. He went on to suggest that there should be tax relief for these savings.”
Mr. MacEntee: What he was thinking about was already being done. If  the Senator will look at the Estimates he will see there was provision made there before the Fine Gael Ard Fheis was heard of.
Mr. O'Higgins: Senator Colgan does not like being wakened up. The Leader of the Opposition also suggested that there should be tax relief on all new savings domestically invested in approved securities, and increased tax relief on life assurance premiums in return for appropriate undertakings by insurance companies to play their part in the Irish capital market. He suggested encouragement of industry, savings by appropriately calculated allowances, and different rates of taxes according to whether profits were ploughed back or withdrawn in dividends. Those were the recommendations made by the Leader of the Opposition. One of these recommendations, and one only, is being implemented by the Government in the initiation of this publicity drive for savings. I should like to suggest to the Minister that the rest of Deputy Costello's speech should engage his very serious attention and that the other recommendations made by him are obviously well worth carrying into effect.
Mr. O'Higgins: The Minister is one of these curious types of individuals who find amusement in serious matters. It is a serious matter for this country  to have a Minister for Finance who will so lightly regard his duties and who will so lightly regard recommendations of that sort made to him.
This Bill gives an opportunity for reviewing Government policy and actions over the past 12 months. We have already had an expression of opinion from the other side as to how many bright spots are to be found in it. I propose to take as my thesis for the moment a quotation from a speech reported in the Irish Press of Monday last, 23rd March, by Mr. Erskine Childers, Minister for Posts and Telegraphs. Speaking at Mullingar, Mr. Childers said:—
I propose to examine what “know-how” the Government have and what “know-how” they have demonstrated during the past year. The Government certainly know how to increase taxation; they know how to increase the cost of living; they know how to increase the bank rate; and they know how to increase unemployment. No one will dispute with the Minister for Posts and Telegraphs that in these matters the Government have the real “know-how.” It is not the Opposition who are annoyed with them for having the “know-how.” It is the ordinary people who are annoyed that the Government should know how to increase taxation; how to increase unemployment; how to increase the bank rate and how drastically to increase the cost of living. The ordinary people are annoyed with the Government for their “know-how” and they demonstrated their annoyance in this city in the recent by-election held in Dublin North-West when the Minister for Finance, who is so easily amused, was trotting around Manor Street telling the people of Dublin that they had better vote Fianna Fáil. Why? Because Eisenhower had been elected President of America. That is the kind of nonsense that is talked by Government Ministers and the kind of “know-how” that Fianna Fáil have demonstrated during the past year.
They know also how to restrict credit and they knew how to slash food subsidies; they know how to depress  trade; and how to slow down the housing drive. Are these the “knows-how” the Minister for Posts and Telegraphs referred to in Mullingar? Is there a Senator supporting the present Government who will deny the accuracy of the recital I have given, who will deny that, in the past 12 months particularly, the Government have increased taxation, have increased the cost of living, have increased unemployment and have increased the bank rate, and have done each of these by deliberate Government policy?
Is there any Senator supporting the Government, or any member of the Government, who will deny that it was because of Government policy that credit throughout this country was restricted; that it was deliberate Government policy to renege on their promises and slash the food subsidies; that it was because of Government policy that practically every trade in the country has been depressed since Fianna Fáil came back into office; and that arising out of Government policy there has been a slowing down and slump in the housing trade, and that many of the 90,000 unemployed who have been referred to by various speakers are unemployed because of the slowing down in the housing trade?
This is the Government with the “know-how,” the Minister for Posts and Telegraphs would have us believe. The Minister has become one of the principal spokesmen for the Government and that was his speech on 23rd March, a speech made after the Taoiseach had admitted, for the first time, that this country was staggering under the weight of taxation imposed by the Fianna Fáil Government. The Taoiseach was not going to get away with that statement too easily. The Minister for Posts and Telegraphs had his ears open and his eyes on him, and a short time after the Taoiseach made that statement, the Minister went this time to Longford and he again had himself reported in the Irish Press on 23rd February last. He decided that some comment would have to be made on the remarks of his leader. He was not quite sure what comment should be made or could be made and in fact he was not quite sure if the Taoiseach  meant anything at all, and, in his speech in Longford, he said:—
“The Government would be interested to see the reaction of Deputy Costello when the Budget came before the Dáil, because, if the Taoiseach's statement that taxation had reached its maximum meant anything, there would have to be some drastic pruning.”
I know that the Minister for Finance has been at loggerheads with some of his Cabinet colleagues during the year, and particularly with the Tánaiste, but I do not think the Minister for Finance would have the nerve to suggest that a statement made by the Taoiseach might mean nothing at all. I have often felt that. I have felt that frequently the Taoiseach's statements were designed to mean two or three different things, but I do not think I have ever suggested they were designed to mean nothing. However, that is the view apparently of the Minister for Posts and Telegraphs. He gives us a clear warning that, occasionally, at any rate, it may be that statements made by the Taoiseach do not mean anything at all, but he goes on to say that if that statement meant anything it meant that there would have to be some drastic pruning.
That was the test. If there was drastic pruning, we could take it that the Taoiseach meant something, and, if there was not drastic pruning, apparently the Taoiseach mean nothing. In a couple of days' time, what happened? It was announced that the Government were going to pay £250,000 for a racehorse. Was this the drastic pruning visualised by the Minister, or was that merely a proof that the suspicion voiced by the Minister that the Taoiseach meant nothing was, in fact, right?
I feel some sympathy with the Taoiseach because, apparently, the Minister for Posts and Telegraphs is out with the hatchet. He is out to get him. We find that in another speech, reported on the 9th March in the Irish Times, he endeavours to pin on the Taoiseach, and the Taoiseach alone, the sole responsibility for all the ills which have befallen this country and which, no  doubt, Senator O'Callaghan deplores. In this speech reported in the Irish Times he said:—
Was there a fake boom over Europe in the years 1950 and '51, or was it the position that countries which had been devastated by war were making a herculean effort to rectify the damage done by the war and were doing that with very definite success? What is fake about that? I suggest to the Minister for Finance and his colleague in the Department of Posts and Telegraphs that there was no fake boom, that there was a definite effort made by the devastated countries to set themselves to right after the war and that to a very great extent they succeeded. But why does the Minister for Posts and Telegraphs give us that as the only alternative for Eamon de Valera being solely responsible for the conditions existing in this country?
Apart from anything else, the Minister for Finance has always been a ready defender of the theory of collective responsibility. I want to suggest to the Minister for Posts and Telegraphs that he and the Minister for Finance and the various other Ministers of the Government must join with the Taoiseach in accepting responsibility for the state of affairs in this country during the past 12 months. I suggest that it is not the Opposition who are annoyed at the Government's know-how as defined by the Minister for Posts and Telegraphs but that it is the ordinary people of the country.
I instanced as proof of that the manner in which the electorate of Dublin City dealt with the Fianna Fáil candidate in the by-election of Dublin North-West. I can give further examples of it. I think it will be accepted without argument that the people who are most receptive to public opinion are Independent Deputies in the Dáil and the fact cannot be allowed to pass without comment that certain Independent Deputies in the  Dáil, who have been keeping the present Government in office since its formation, some while ago decided it was time for them to sound a note of warning to the Government. These Deputies obviously interpreted the feelings of the people in the country and in the city and the result of the North-West Dublin by-election as serving notice on the Government that their days were numbered.
We find at columns 614 and 615 of the Official Dáil Debates of 18th of this month what one of the Independent Deputies who has consistently supported the Government up to now— despite the fact that the Government had jettisoned the programme which they published to secure this Deputy's vote and the votes of other Independent Deputies when they slashed the food subsidies—and who continues to support the Government said about the Government and the Government's policy over the last 12 months:—
“I think they have the best interests of the people at heart. They have shown that in the past. But it does need more than good intentions in running the country, you must show results as well. Listening to the Taoiseach, I could not help feeling that the most important matter is not whether the Government policy is the same or very much the same as that of the Opposition. I do not give a damn whether it is or not. The only interest I have is whether the policy works, and the policy of the last year, I respectfully submit, has not worked. I believe that the results of that policy have been too serious for many of our people to allow anybody to feel in any way complacent about it.”
Mr. O'Higgins: I do not believe I have mentioned the name of a Deputy  in this House ever but other Senators will probably work it out. It might take Senator Colgan a bit longer so I will give him a clue. He represents the same constituency as the Minister for Finance.
Mr. O'Higgins: Another Independent Deputy contributed to the debate on the Vote on Account in the Dáil on Thursday, 19th March, 1953, columns 765 and 766 Official Dáil Debates. This is one of the gentlemen who voted for the present Government and who has the present Government in the palm of his hand.
Mr. O'Higgins: Another Independent contributed to the debate on the Vote on Account in the Dáil on Thursday, 19th March, 1953, columns 765 and 766 Official Dáil Debates. This is one of the gentlemen who voted for the present Government and who has the present Government in the palm of his hand.
Mr. O'Higgins: Independents have been defined as people upon whom no one can depend. I take it that is Senator Colgan's view. However, this Independent Deputy to whom I refer is one of the few who have the Government in the palm of their hand. He can turn the Government out of office on any given day. He also sounded a note of warning. At columns 765 and 766 of the Official Dáil Debates of 19th March, 1953, this man said:—
“There is now one real problem facing this country, and all other problems which have been discussed pale into insignificance beside it; that is, that there are 90,000 people unemployed. I want to find out what exactly is the policy of the present Government to alleviate that situation. I have looked in these Estimates and quite frankly I do not see anything that promises the slightest hope of alleviation to those 90,000 unemployed.”
That is the view of another Independent Deputy who has the fate of the Government in his hand. I want to ask the Minister the same question. What does he propose to do about the 90,000 unemployed and what plans, if any, have the Government made in relation to solving that problem which was described by another Senator opposite as a problem beside which all other problems pale into insignificance? You have in these quotations which I have given to you an indication, to put it no stronger, that the days of the existence of the present Government are numbered.
Mr. O'Higgins: I think I am entitled in passing to say that even if the Government produces at this stage a policy, even based on the fear that their  days are numbered, the people will, at least, pay them the courtesy of examining it. But there are people supporting the Government and keeping the Government in power who say that in this Book of Estimates which they have given very close examination they cannot find the faintest vestige of Government policy for alleviating the position of the 90,000 unemployed. I am afraid that is a fact, and I wonder what the Minister proposes to do about it. His record has not been encouraging. By implementing the Central Bank Report which he recommended, he created a pool of unemployed and that was precisely what the Minister for Finance set out to do and has done. Does he now intend to rectify it?
Another thing that must be disturbing those Senators to whom I referred and certainly is disturbing the people interested in politics who followed the activities of the Government and read the speeches of Ministers as well as the Deputies and Senators supporting the Government, is the extraordinary contradiction in Government policy over the last 12 months. I suggest it is quite clear that these contradictions arise from internal dissension in the Cabinet.
Mr. O'Higgins: I think we shall give the Minister something to think about. I want to produce for the benefit of Senator Loughman some of the evidence. I agree that thinking or talking without producing the corpus will not impress him. I suggest there is some kind of internal conflict and dissension going on. I do not pretend to know the reason for it and I do not know what it is, except personal antipathy.
Mr. O'Higgins: That there is such a  conflict is quite clear and it is equally clear that the main conflict is between the Minister for Finance and the Minister for Industry and Commerce, and the proof of the matter is that the Central Bank Report of some while back which was completely jettisoned and thrown overboard in the Dáil by the Tánaiste, has ever since been gradually and step-by-step implemented by the Minister for Finance. Which of them was right? I do not know, but the fact that there is conflict is self-evident and in that particular tug-of-war the Minister for Finance got out on top.
I referred to the question of savings, and the Minister said that that was nothing new. He was backed up by Senator Colgan in that assertion. I do not suggest it is anything new and, in fact, the Minister for Finance in his Budget speech last year referred to the question himself, and while he cut down food subsidies and increased taxation, all on the basis——
Mr. O'Higgins: I am dealing with savings and have no intention of forgetting. While the Minister for Finance increased taxation and cut food subsidies, it was on the basis that the people of this country were eating too much, living too well and spending too much. He pleaded with the people of the country that, over and above anything else and notwithstanding the fact that he was going to make it harder for them to eat, make food dearer and take as much money as possible out of their pockets by way of taxation, he wanted them to save 10 per cent. of their annual income.
Mr. O'Higgins: I do not dispute the fact that they took his advice, but they did not take the advice of the Minister for Industry and Commerce when, two months later, he went to the annual dinner of the Drapers' Chamber of Trade and stated out publicly—and this will be found by Senator Colgan if he is wide-awake enough to read the newspapers——
Mr. O'Higgins: What you read was an appeal by the Minister for Industry and Commerce to “spend and spend now.” He told these people that there was no chance of clothing coming down or prices falling and that goods were not going to be cheaper. No matter what the Minister for Finance had stated in the Dáil, so far as the Tánaiste and Minister for Industry and Commerce was concerned, he was telling the people to “spend and to spend now.”
Mr. O'Higgins: They did not and that is one of the reasons why you have so many people unemployed. I want to know what was the conflict. The Minister for Posts and Telegraphs blames the Taoiseach for everything that happened and says that he was solely responsible.
Mr. O'Higgins: We remember how during the past year, and even before it, the Minister for Finance was going around the country telling us that we were put to the pin of our collar to maintain the value of the Irish £ and telling the people that they were overspending, living too well and eating too much. Every one of us remembered that. These speeches——
Mr. O'Higgins: I did not hear him then. His policy was framed on that assumption and I do not think that it would be denied. I doubt if the Minister would deny it. While that policy was being pursued and while these speeches were being made, we were being told that we were put to the pin of our collar to maintain the value of the Irish £. What was the Minister for Industry and Commerce doing then? Would you not imagine that he as Tánaiste would be backing the hand of the Minister for Finance? Not at all, he was planning the resurrection of the transatlantic air services and planning to play the Budget-day Santa Claus to the dance-hall proprietors.
Mr. O'Higgins: That conflict has been going on for the last 12 months and has come out to the open every now and again. I want to ask the Minister for Finance has he yet composed his differences with the Minister for Industry and Commerce.
Mr. O'Higgins: I do not follow that. Dr. Ryan made a speech not so long ago in which he told some Fianna Fáil cumann in County Wexford that he could not see that in a Fianna Fáil Budget there would be any worthwhile  reliefs. Mr. Childers says that in fact if the Taoiseach's speech means anything it means that there was going to be very drastic pruning and Senator Quirke now says that the Minister for Health said that there were not going to be any worthwhile reliefs at all.
Before I conclude I would like to say a word in support of a matter mentioned here to-night by Senator Professor Stanford in relation to the Irish News Agency. Senator Stanford pointed out that when the Irish News Agency Bill was going through the Seanad the then Minister for External Affairs made it quite clear that it was Government policy and it was the policy of the News Agency that that agency would not deal with what is described as hot news. I have a very definite recollection not in this House but in the other House of the Oireachtas that the then Minister for External Affairs gave a more definite assurance to the Dáil.
It is only incidental to what I am saying now, that the Fianna Fáil Party undertook that their first action if returned to power would be to abolish the Irish News Agency. However, the Minister for External Affairs did give that assurance and it was on the basis of that assurance, and in that Senator Stanford is quite right, that the Irish News Agency Bill was accepted by the Dáil and Seanad and subsequently became an Act. It was made even clearer to the Dáil than the remark about not dealing with hot news that the purpose in establishing the Irish  News Agency was to assist in the fight against Partition. I regret to say and I think we must all agree with Senator Stanford that the Irish News Agency has completely departed from the assurance given by the Minister for External Affairs when the Bill was being introduced. I am not going to deal with the question of whether or not what they are doing is an improvement on the business or not. It might well be that that is a matter which could be the subject of a separate debate. I know it is certainly a matter about which there could be quite strong views for and against as to whether the Irish News Agency is doing a proper job by dealing in hot news or not.
That, however, is not the question in which I am interested, and I am sure it is not the question in which Senator Stanford is interested now. What I am interested in is the position now obtaining where the Irish News Agency, established by the State and financed by the taxpayers, is working against the categorical assurances given by a Minister of this State on its establishment. Whether encouraged or not by the change of Government I do not know, but they are completely going against the assurances given by the Minister. I would ask the Minister for Finance to consider that matter very seriously and to have it taken up with the Irish News Agency if necessary.
There is not much more that I want to say but the Minister, before he concludes—and I am quite serious in asking him this—might tell the House he has had any communication this year with the British Chancellor of the Exchequer. You may remember that last year a meeting took place.
Mr. O'Higgins: The Minister may go back to 1948 if he likes, but the fact that he gets peevish when I mention the British Chancellor of the Exchequer is not going to prevent me from asking  him the question. Most of us are aware that a meeting took place last year, and I understand that the Minister resents the suggestion that it took place on a summons from the British Chancellor of the Exchequer, but I want to know if there has been any exchange of views this year.
Mr. O'Higgins: As far as I am concerned, the Minister need not even listen to me. As a representative, described by the Minister as a political representative, I am entitled to put this question and I am going to put it to the Minister. Does the Minister intend to follow, as he did last year, the British Chancellor of the Exchequer in increasing the travel allowance and, if so, to what extent? The British Budget is being introduced on the 14th April. Finally, and this is my last question, is it in consequence of that fact that the Dáil will not reassemble until the 15th April?
Mr. Kissane: I did not intend to participate in this debate until I heard Senator O'Higgins speaking, and nobody listening to him could sit down here without being tempted to deal with the points which he has put forward in his speech. Senator O'Higgins referred to the by-election in Dublin, among many other things, but I noticed that he was very careful not to refer to the three by-elections that took place in the country earlier in the year.
Mr. Kissane: They all took place within the 12 months. If results of by-elections are to be taken here as any indication of the trend of public opinion, would it not be as well, then, that all these by-elections be dealt with and the verdict of the people in all of them be taken notice of? As he did refer to the by-election in Dublin, let me say that one thing emerged from that, and that was that Fine Gael  were afraid to put up a candidate. Therefore I cannot see for the life of me how the members of Fine Gael can claim any victory in that by-election when they refused or were afraid to put forward a candidate. I do not think it is to the credit of Senator O'Higgins or his Party to make any reference at all to the by-election that took place in Dublin North-West.
In this debate we have again heard reference to what could be described as the hardy annuals, such as high taxation, the cost of living, unemployment, and so on. But one is amazed, when listening to Senator O'Higgins, that he does not trace the high cost of living and its causes back to the source because I am aware that there had been a steep incline in the cost of living even during the period of the Coalition Government. In fact, it can be said that it is to the period of the Coalition Government, especially the latter part of it, that nearly half the increase in the cost of living can be ascribed. Mind you, when any trend like that happens in the national life of the country it cannot be arrested overnight. It takes some time to overtake it and, after all, this Government has not been so long in office—only since June, 1951—that it could be expected to eliminate all these social evils, even those that have come down from the Coalition days.
We could bring down the cost of living in the morning if we were prepared to take certain measures but in taking those measures we would want to make sure that it would be beneficial from the national standpoint. For instance, recently there has been an increase in the price of butter and that, no doubt, accounts for some points in the cost of living. We could reduce the price of butter by reducing the price of milk but would the Opposition dare to advocate a policy of that sort or would they be prepared to go back to the policy of the former Minister for Agriculture, Mr. Dillon, who proposed to reduce the price of milk to 1/- per gallon? That is the question; that is a matter upon which we would like to get an expression of opinion from the members of the Opposition.  The position is similar with regard to the price of wheat and the price of beet for which there are guaranteed prices. The cost of living could be brought down if we were prepared to reduce the guaranteed price to the farmers who, we expect, will grow more wheat and more beet this year, but it would be unsound nationally to do so. Thus, when we talk about the cost of living we have to take all these matters into account.
It is all very well for members of the Opposition or for members of the Seanad sitting on the opposite benches to talk about the cost of living but to shed all responsibility for suggesting any way in which it can be brought down. Again, we have heard from Senator O'Higgins a reference to high taxation. Of course, taxation is high in this country as it is in all other countries; indeed, it is higher in most other countries. But if it is high, that is due to the services that have to be provided by the State, and provided in ever increasing measure. Would those people who have spoken about high taxation recommend to the Government that such services should be cut down? If they do, we would like to hear from them where, how, and to what extent. That would be the realistic way to approach it, because Governments as a rule do not impose taxation for the love of it.
Senator O'Higgins also referred to the housing drive and suggested that there has been a slowing down of the housing drive in this country. The figures do not tally with that statement. The number of houses completed last year was 13,000 as against 12,000 the previous year. What has Senator O'Higgins to say to that? And let us take all the other activities of the Government, such as hospitalisation, the erection of schools, and the repair of school buildings. I suggest that there has been an increase in the amount of activity, and a substantial advance in connection with these things. Would some of the people who have spoken, especially Senator O'Higgins, who would want us to reduce taxation, advocate the cutting down of the activity of the Government  in these spheres? That is another question that we would like to have answered.
Bord na Móna have been increasing their activities year after year. They have been turning out more machine-won turf. There are proposals also for the erection and establishment of generating stations in certain parts of the country. These, I suggest, are activities that are bound to cost money, and of course the money would have to be got. I would also refer to the Rural Electrification Scheme and many other schemes that have been started by this Government for the good of the country.
Again, I would refer to the social services. We have often referred to them before. Taxation, of course, could be cut down by reducing the social services in this country. Are those who are dissatisfied with Government policy on the head of taxation prepared to subscribe to that idea, to the idea of cutting down the social services? No, but the point is that when increases or improvements in the social services are being put forward by the Government the Opposition are all in favour of them for the moment. Everything is beautiful. Then when the time comes to find the money to pay for them they have a totally different tune. They cannot have it both ways. They cannot have their cake and eat it. It is about time that those people who are condemning the Government on the score of taxation and the cost of living would come down to the realities and tell us whether they are in favour of cutting down the activities to which I refer and whether they are in favour of cutting down the social services.
Senator O'Higgins devoted a good deal of his speech to the Independents who are supporting the Government. Why are they supporting the Government? Why are they supporting this Government? It is because they believe that the Ministers who comprise the present Government are more likely to promote the welfare of the country generally speaking than any combination of the other Parties in the Dáil; and in that they are in a position to fall back on their experience, because they had experience of the Coalition for nearly three and a half  years, and those Independents supported the Coalition Government until they found that the conduct and behaviour of that Coalition Government would not warrant their support any longer.
Experienced people, experienced public representatives, do not turn away lightly from a Government to which they have been lending support over a period. They do not turn away without some cause, and the cause was that they did not find that Coalition Government operating in the best interests of the people. Now of course that they are supporting this Government they are the worst in the world according to Opposition spokesmen. While they were supporting the former Government they were the white haired boys, but now there is no word in the dictionary strong enough to use in condemnation of them. Surely that is a childish approach to the whole problem of Government.
Senator O'Higgins referred to savings in this country, and I think he had to admit that savings have gone up; and if savings have increased in this country what is it due to? There must be some cause. It is due to the fact that there is more prosperity in the country, because a man cannot save money unless he is fairly prosperous. That is a fact. Nobody can lay aside savings unless he is able to meet his commitments and do a little over and above that. So when we hear from these critics of the Government, who pretend that conditions in the country to-day are bad, they should take notice of that, that they cannot be so bad when it is possible for the ordinary people of the country to save more money.
Now before I finish my remarks I would like to refer to a question that was asked in the Dáil. I am reiterating that question because I believe it is all important. It was the Taoiseach himself who posed the question to the Opposition Parties in the Dáil. If the Coalition had succeeded in forming a Government in 1951 and if they had been confronted with a deficit of £15,000,000, such as this Government was confronted with, what would they have done to bridge  that gap? They were asked if they would have proceeded to meet current expenditure out of current revenue, as this Minister for Finance has been trying to do, or would they have continued along the road they had been traversing of increasing the deficit and borrowing excessively as they had been doing? That is a question that should be answered. It is the aim of this Government to meet current expenditure out of current revenue and, if there is to be borrowing, and there will always be a certain amount of borrowing, it must be for capital purposes, and even then in a prudent way.
Similarly, the country was faced with a deficit in the balance of payments, an ever-mounting deficit. After the first year of Coalition Government, the figure was £10,000,000; it then jumped to £30,000,000 and in the final year, it was £61.6 millions. Would the Coalition, if they had gone into office again, have allowed that to continue? I am glad that the Government of to-day have pursued the course they have pursued and the gratitude of the people goes forth to the Minister for Finance for the wonderful job he has made of it. He was presented in June, 1951, with an enormous task. It took a courageous man to face it and it is a matter of gratification to us to know that he has succeeded in grappling with the problem very well.
There are many things I should like to say on this Central Fund Bill but I do not propose to go into any detail. I conclude by advising members of the Opposition in the Dáil and Seanad to desist from their campaign of trying to create extra difficulties for the Government and trying to pretend that the Government are responsible for things for which they are not responsible at all. Senator O'Higgins, for instance, mentioned the bank rate and condemned the Minister for having increased the bank rate. Does any sensible person here think that the Minister increased the bank rate out of malice? Is it not a fact that he had, of necessity, to follow the trend of the money market all over the sterling area?
No Minister for Finance in this country could stick his head in the  sand and ignore what was taking place in financial circles in other countries any more than the former Minister was able to ignore what was taking place within the sterling area when he devalued the £ in this country, when he followed the decision of Britain after Britain had decided to devalue the £. The Minister for Finance here had to do the same. These are things that are not confined to domestic circles. The general trend outside has to be followed and if the bank rate to-day is higher than it was it is because money had become dearer and was harder to get. It would be far better for those people who try to criticise the Government for these things to desist, because nobody will take them seriously. The plain people know very well what is involved. They cannot be fooled and they are much better “up” in these matters than they are given credit for by politicians.
Mr. McGuire: I understand that it has been agreed that the Minister will speak at 9 o'clock and I propose to say only a few words. I feel that too much of the time in this debate has been taken up with scoring political points. I suppose that is unavoidable and inevitable in a debate such as this, where Government policy is open for discussion, but we should not forget that Government policy is, in fact, State policy, something we are all interested in, and it is important, therefore, especially in this House, that we should try to make as far as possible a vocational contribution to the debate. I want to say a very few things, but I should like to follow a constructive line in saying them.
I suppose nearly everybody has read what is now known as the Stacey May American Report. In that report, it is pointed out that, though we seem to be full of energy and goodwill in this country, it is, in fact, very hard to find a clearly-defined economic policy in operation after 30 years of self-government. The American report goes on to point out that if we have a policy—we say we are a private enterprise country and so on—we do not seem to be directing our budgetary policy and the general work of the community towards  furthering it. I think it is agreed by everybody on all sides, from the Taoiseach to the members of the Opposition, that there has been a steady and progressive rise in taxation over the past 20 years and that taxation is excessive. Different adjectives have been used by different people to describe it, but it all adds up to the fact that taxation is too high. That is something which seems to be above Parties and agreed to by all Parties.
I suggest that one of the causes of the ever-increasing taxation is the steady and progressive extension of State control and of State helps to all kinds of people, many of which are very desirable and many of which are absolutely necessary, but others of which are not necessary. We very often go too far in these matters and involve ourselves in ever-increasing expense of all kinds—more officials, more outlay in carrying out things for people and groups of people which they could well do for themselves. The Taoiseach himself has made a declaration to this effect. All this kind of thing leads to higher costs for running the State. The State is taking on more and more as time goes on. We see Bills going through the Oireachtas that we could very well do without. Those Bills cost money and cause more taxation. The American report is perfectly right when it says that we have developed a high degree of statism in this country. There are a lot of things being done by our State that could be better done by vocational bodies and groups of citizens themselves. It would be better for the State and better for the individual initiative and individual character of our citizens if they were allowed to do these things for themselves through their vocational bodies.
Not only does the report say that taxation is too high but it also states that production is too low, that capital investment is insufficient, that we have too much unemployment and too much emigration. These are statements which we can hardly contradict, and if we desire to improve our situation our financial policy should be directed towards creating more capital for investment  both in agriculture and industry. In other words, we should all be encouraged to save.
We have heard about the Government propaganda programme which started this morning in connection with saving. That is a very desirable object but it is only a first step to advise the people to save. We must go further. The State should encourage the people to save. It should make it easier for them to save by having less taxation. When they have saved, they should not be penalised in regard to their capital. There are all sorts of penalties in regard to capital and improving business premises in the country. I will not enumerate those penalties now. We all know them. We should direct our taxation and financial policies towards encouraging people to save and when they have saved we should encourage them to build up large capital in the country.
I think we all recognise that agriculture is the beginning and end of our economy. It is the basis of our national wealth. An industrial programme is all right and absolutely necessary but it is second to agriculture. Although I am a businessman and I do not know much about agriculture I realise how important it is to us all. In England at present there is a high standard in regard to agriculture. The British people have had to develop it because of their financial position. Their land to-day is splendidly tilled and stocked with cattle. I was there a few weeks ago and I was very struck by its developed condition. The same position obtains on the Continent, in Switzerland and Denmark but when one turns to Ireland one feels ashamed of the undeveloped state of our countryside as compared with the condition of the land in other countries.
That is not only a question of capital investment but also one of education. I feel that the young people should be educated in agriculture. We seem to educate our people mostly for the professions. Surely our educational system should be primarily directed towards making our young people fitted to develop our natural wealth. They should be made to love a farming life. The same is true in  respect of business. It is only within comparatively recent years that business has been regarded as something worthy of the attention of people who are educated. During my own lifetime —I am not very old—there was supposed to be something wrong about being connected with trade. That sort of atmosphere still persists. Our aim in educational matters should be to equip our people to take up agriculture as well as to enter industrial enterprises. That should be our aim rather than to educate them for the professions which are already very much overcrowded. We are really only educating our people for export.
I did not intend to speak this evening but I do not think that anybody from the commercial community spoke. I felt I ought to say a few words because there is a lot of alarm amongst the business people about our present economic position. By the business people I mean all people who are concerned with the creating of wealth and employment in the country. The chambers of commerce sent a letter to the Minister for Finance recently. That is a document that was not meant merely for Deputy MacEntee as the Fianna Fáil Minister for Finance. It was meant for the Minister for Finance of this State and applies to all Ministers for Finance. Instead of scoring Party points off one another, instead of seeing what we can spend money on to provide all sorts of services that would be desirable if we could afford them, it is most important that, after 30 years of self-government, we should settle down even at this late stage to create an economy and a machinery which will produce the income to give us all the money we want to build up a sensible Irish economy from which we could get a decent standard of living for our people.
Mr. Colgan: I want to reply to some things said by Senator Stanford and to a lesser extent by Senator O'Higgins on the question of the Irish News Agency. I recall that Griffith told us that the British had built a paper wall around this country. On the outside of that wall was put what the British wanted the world to believe about us  and on the inside was put what they wanted us to believe about the outside world. The previous Minister for External Affairs came in here with banners flying and flags waving and gave us the impression that Partition would be ended in a short period. One of the means to end Partition was the institution of the Irish News Agency. I welcomed it as I felt something might be done generally to help the Irish viewpoint abroad. I supported it.
Senator Standford is right when he says that the Minister gave an assurance that no hot news would be handled, but that was an impossible thing to do as far as any news agency is concerned whether Irish or foreign. The Senator complained about the picture of the little girl being chased in Derry on St. Patrick's Day by the Royal Ulster Constabulary. Is there any other news agency in the world who would publish that? I think it was of great propaganda value and the news agency was quite right to distribute it as much as they possibly could. I would be opposed to the agency going into competition with ordinary working journalists. I feel that the attempt to muzzle completely the news agency is all wrong. If they are told that they cannot do this or do that a success would never be made of the news agency. Senator O'Higgins supported Senator Stanford. We have this mythical difference between the Minister for Finance and the Minister for Industry and Commerce, but there would seem to be a difference emerging between Senator O'Higgins and the Leader of Clann na Poblachta. I think that is more apparent than the difference he alleges to exist between the Minister for Finance and the Minister for Industry and Commerce.
I hope that the Government will continue to support the idea of an Irish News Agency. It is something through which we ought to put the Irish viewpoint across because nobody else will do it for us. We know what news agencies are, particularly with reference to this country. Their accounts are generally garbled. I do not believe that we should spend huge sums on the news agency but we should help it as much as possible and see that it is kept  in existence for the purpose of disseminating Irish news abroad.
Mr. MacEntee: I regret that Senator McGuire did not open this debate instead of Senator Hayes because I might have found myself more devoid of controversial material for a reply than has been afforded me by the Senator who did open it. I cannot quarrel with the approach which Senator McGuire suggests we should adopt in considering matters of public policy which come before this House for discussion. In order that there should be no misunderstanding, however, about the reference made in the Stacey May Report of the financial and economic conditions existing in this country, I think I should put it upon record that, according to the report, the field work for it was carried out in Ireland in June and July of 1951—another member of the team responsible for the report visiting Ireland in September, 1951. Its findings therefore were obviously based upon conditions which the Stacey May team found existent at that date. Whether, if the same team were to visit the country to-day, they would have precisely the same criticism to make is something known to none of us, of course.
Senator Hayes on this occasion, somewhat unusually for himself followed my succinct and purely factual opening like an Indian brave and came in with war whoops and a tomahawk to scalp, not merely the members of the Fianna Fail administration, but every member of the Fianna Fáil Party since its inception and initiation in 1927. In fact, the Senator went back to the days which preceded the birth of the Party and administered what one might call pre-natal scarification. He referred to the civil war and to our attitude in 1927 when we entered the Oireachtas of the Free State. He alleged that we had come in full of venom towards the civil servants and towards public employees generally, but I think, and I am sure Senator Hayes will agree with me when he thinks it over in his calmer moments, that that was an unfortunate reference to make.
We sacked no man when we came into office in 1932 because of his political  opinions and asked no teacher, either primary or secondary, to sign a political test pledging their allegiance, support and loyalty to the Government of the day. We accepted all the members of the Civil Service and the teaching profession as we found them and gave them what is described in America as “a fair deal”. We have no animus towards any member of the Civil Service or any member of the forces who were in arms against us in 1922 and 1923. We have tried, to the best of our ability, to fulfil the precept of Tone and unite the whole people of Ireland, which is the basis of Fianna Fáil policy.
I think that Senator Hayes's arguments in regard to the standards of pay, remuneration and conditions of service of the civil servants were somewhat misconceived. He argued, for instance, that for work of a type which would normally be done by a person who had secured the Intermediate Certificate the Government were getting the very foremost who had secured the Leaving Certificate. I assume that consistently with that he would have stated that the same thing applied to the executive grades. What does that prove? It can only prove that the conditions of pay and of service are so attractive that we are in fact attracting to these lower grades people of a very much higher standard than normally the work of those grades would call for. I think that nothing else can be deduced from the arguments which the Senator advanced.
I do not propose to deal at all with the Senator's suggestion that it has been our policy to increase continuously the cost of the public service, because that has already been demonstrated beyond denial to be untrue. If the norm of judgement is to be the record of our predecessors, then in 1947-1948, as has been pointed out here by Senator Hawkins, the total expenditure on supplies and services reached a figure of £58,918,000. In 1951-1952 expenditure on Estimates which had been prepared by our immediate predecessors in Government showed an increase to over £90,000,000—an increase of 53 per cent. in three years in the cost of these services. To the extent to which there was a further  considerable increase in cost last year, it was due mainly to the policy of our predecessors in establishing, first of all, the arbitration board to honour whose findings we had to find £3,500,000.
In addition to that, we had to find one half year's interest on the Marshall Aid Loan, and had, furthermore, to find the annuity which is payable in respect of voted supplies and services. We had also to implement, in an amended form, of course, the decision of our predecessors which was adopted and accepted by us, to extend and improve social services, and to bring in a new Health Bill. These are factors which have occasioned this very substantial rise in the cost of public services. We have inherited many obligations from our predecessors and we are endeavouring to fulfil them.
Turning to the speech of Senator O'Brien, I should like to say that I listened to it with a great deal of attention, and with a great part of it I would not have much quarrel. There is, however, one statement of his which, I think, might not be fully substantiated by the facts. He stated that agricultural production was stagnant. That may have been so two or three years ago. I think indeed that, so far as the statistics go, they demonstrate that that probably was the position in 1949, 1950 and 1951. Undoubtedly there does not appear to have been any very great or significant increase in agricultural production over that particular period. There has, however, been a very significant change since then-a change which has taken place during the year 1952
Senator McGee, whose knowledge of rural conditions, I think, very few Senators would dispute has stated that the one thing that is clear, forthright and satisfying is the very great rural prosperity that is apparent everywhere. That is what Senator McGee has stated. Supporting that assertion we have furthermore this very significant fact that in 1952 we had a very substantial increase in exports of agricultural produce and a very substantial overall increase in exports of all kinds. I think that the figures are worth putting on record. Agricultural produce increased in value from £46.7 million  in 1951 to £54.1 million in 1952. That is an increase of £7.4 million. Other exports increased from £33.1 million in value in 1951 to £45,000,000 in 1952, an increase of £11.9 million. The overall figures were total exports £79.8 million in 1951 and £99.1 million in 1952 or an increase of £19.3 million.
Let us now consider what the volume index discloses. Taking the total of all exports and re-exports in 1951 as 100, in 1952 the volume index was 121, or an increase of 21 per cent. Against that the price index for exports shows that their statistical unit value rose from 114.1 in 1951 to the index number 117 in 1952 or only about 2½ per cent.
These statistics would not seem to suggest that, taking them with certain others which I shall mention, there was stagnation in agricultural production. Thus we have the fact that the number of live stock in this country on 1st January, 1950, which might be described as the last full year of the Coalition régime, was 3,821,000 head, and on the 1st of January last the cattle population had increased to 3,872,000 head. Similarly the pig population was estimated on 1st January, 1950, at 510,500 beasts and on the 1st of January this year that number had increased by 50 per cent. to 764,700 pigs. It seems to me, therefore, that perhaps—and I want to make this statement with all reserve—that perhaps it is no longer true to say that agricultural production in this country is stagnant. On the contrary, agricultural production is increasing and is expanding and we have proof of that again in the statement made by Senator O'Callaghan that there will be a considerable increase in the area under wheat and beet in this year. These are facts which, in view of the manner in which Senator O'Higgins, with the usual family facility for misrepresenting statements, has tried to distort the statement made by Senator O'Callaghan, are worth recording.
I do not wish, however, while I say all this, to quarrel with the statement which Senator O'Brien made that possibly the financial structure which productive industry in this country was carrying was too top heavy for the base. I feel that there is a great  deal of truth in that, and so far as I can influence any new change for the better in the situation, I shall certainly endeavour to do so.
I also cannot quarrel with the statement that the Senator made that while we want a balance in our external payments and a balanced Budget, we want the balance of external payments to be achieved at the highest possible level of trade, while equally clearly we want the balance on the Budget to be achieved at the lowest possible level. These are matters on which, I think, there will be common agreement.
I want to come to one of the statements made by Senator O'Brien to which I might take exception, I think rather because of the implication which it contained. Senator O'Brien said that among the economies which should not be practised are those which give rise to discontent in public service, and the allegation that promises have been broken. I do not know whether the Senator has in fact endorsed the allegation that promises have been broken, but in case that any other member of the House might be disposed to assume that promises had been broken, if I allowed the Senator's statement to go unchallenged, I should like to say that the Government has not broken in any particular the agreement which was made with the Civil Service to establish a scheme of conciliation and arbitration.
On the contrary, the Government acting in the best interests of the State and in the interest of the people has merely insisted on the right which it enjoys under the scheme to reserve taking action upon the arbitrator's award until the financial, the fiscal, consequences of giving effect to that award have become manifest, and until the capacity of the people—because it is the people who are involved in this and not the Government; it is the people who have to honour the arbitrator's award, as the money does not come out of the pockets or the coffers of the Government, but out of the pockets or coffers of the taxpayers— to meet the increased burden which the arbitrator's award would impose on them has become clear.
I want to put on the record of this  House what is the significant section, the effective section of the arbitration scheme in this matter. The effective provision to which I refer is Article 20 of Part IV of the Civil Service Scheme for Conciliation and Arbitration. Part IV relates to arbitration only and Section 20 reads as follows:—
“...will either signify its acceptance of the finding contained in the board's report or will introduce a motion in Dáil Éireann recommending either the rejection of the finding or such modification therein as it thinks fit.
(2) When they receive a report from the arbitration board on a claim for a general revision of Civil Service pay, the Government will, when presenting the report to Dáil Éireann in accordance with paragraph 19 preceding, adopt one of the following courses:—
(c) signify (1) that they consider that it would not be possible, without imposing additional taxation, to give full effect to the findings within the current financial year, (2) that they propose to defer a final decision on the report until the Budget for the next following financial year is being framed, and (3) to what extent, if any, they propose in the interval, without prejudice to the final decision, to give effect to the findings, the extent of the payment to be determined by the amount which can be met without imposing additional taxation.”
I direct the attention of the Seanad to those words: “the amount which can be met without imposing additional taxation.” The Taoiseach and myself in public statements in Dáil Éireann have already mentioned that the Budget for this year will show a deficit  and therefore it would not be possible, unless we were going to borrow in order to pay the salaries and remunerations of the civil servants, to give effect to the award without imposing additional taxation. The general purport of paragraph (c) of sub-section (2) of Section 20 of the arbitration agreement is that if the implementation of the award is going to necessitate the imposition of additional taxation, the Government has the right—and indeed I should say has the duty—to defer taking a final decision on the award until the Budget for the following year is being framed.
Now, I have said here that the Government has acted wholly within its rights and, I think, has acted as it is bound to do in the discharge of its duty to the taxpayers and to the people of the country generally. What has been the attitude, however, of those whose conduct apparently is endorsed here by Senator Hayes and Senator O'Higgins? They have attempted by public agitation to coerce the Government to forego its rights under the scheme. They have endeavoured to coerce us by public agitation to abandon or to fail to discharge our duty to the taxpayer.
Now, every article in this scheme of conciliation and arbitration is of equal weight with every other article in it. If the civil servants have rights under the scheme, the people of this country and the Government which represents the people and acts for them have rights, too. These rights are just as sacrosanct as those of the civil servants but the action which has been taken by certain Civil Service organisations is a denial of this principle. It constitutes on the part of the particular associations concerned a breach of the fundamental agreement between the staff associations and the Government and it, therefore, must raise the question—and it certainly has raised it in my mind at least—as to whether the Government should continue to recognise these particular associations as coming within the terms of the scheme.
There are certain staff associations which have honoured the agreement in the spirit and the letter and I should like to make it quite clear that they  are in no way covered by what I have just said. They have recognised the difficult position in which the Government finds itself and they have accepted the fact that the Government is acting in good faith and, as I have said, in discharge of its public duty. I have no criticism whatever to make of them. On the contrary, I have indeed to acknowledge the responsible and restrained way in which they have behaved during the whole of this very trying time.
Perhaps I may leave that to come to another suggestion which Senator O'Brien made. The Senator suggested that there should be some sort of corporation or organisation set up for the purpose of collecting, channelling and investing the small savings of the people. There is, of course, already in that field one very big institution, the Post Office Savings Bank. Under the ægis of the Post Office also we have the plan of savings certificates. Both of these are designed to tap such pool of small savings as may exist. It is quite true, of course, that the Post Office Savings Bank does not at all—nor do any of the trustee savings banks— invest or place their resources in industrial securities, and to that extent they would fail to fulfil the whole purpose which Senator O'Brien had in mind in making the proposal. But, at any event, I think it would be quite fair to say that they receive the whole volume of small savings available and that nowadays they devote the proceeds wholly to financing capital undertakings.
The Post Office telephone expansion, the telephone capital expenditure, is financed mainly from the Post Office Savings Bank. The proceeds of the savings certificates go into the Exchequer in the ordinary way and are used to defray the cost of various capital projects that are undertaken by the Government directly or by the various statutory undertakings set up by the Oireachtas, like the E.S.B., Bord na Móna and those other concerns with which we are all familiar.
Now the first question, therefore, that arises is what savings would be left to feed this investment corporation which Senator O'Brien has  pressed for. Would the amount of savings remaining be sufficient justification for establishing it? I think that we can put up a very large question mark there, at any rate.
The next thing is, with our very limited resources and in our very limited market, where the number of active operators in industrial securities would be very small, would such an investment corporation as Senator O'Brien has in mind be really a very great asset to us, bearing in mind that he thought of it as an agency for attracting foreign capital into our industrial enterprises. I think that it is to be doubted, because the real difficulty in activating the market in Irish industrial securities is that in general the conditions which make for prosperity and expansion of Irish industry on the one hand, or recession on the other, are very largely outside our control. Irish industry—we may as well face up to it—is a very narrow and unrepresentative sector of world industry, and world conditions would have much the same effect, would have full effect here on Irish investors or on potential investors from outside as they have elsewhere. They would have all these reactions with this difference, that an investment corporation would naturally be very anxious to conserve its capital resources, would get out if it thought the market was going to fall and might not be so anxious to get in again even if it thought the market was going to rise.
In conditions like a state of business recession or depression or whatever description we care to use, a large investment corporation would be anxious to get out, and will be prepared to do so, to cut its losses at a very early stage, and will be especially anxious to do so if a large part of its capital is derived from external sources. On the other hand, if you have not any such organisation operating, if the holdings are widely distributed, the ordinary small holder of Irish industrial securities, even if the market does start to slide a bit, is generally prepared to hold on to them, mainly because it is expensive for him to get out—is generally prepared to hold on in the hope that conditions will change  and that the market value of his securities will rise again.
In the course of the debate here a great many things were raised which I think the Government cannot be held responsible for. Senator McGee referred, for instance, to the manner in which local authorities maintain county roads, particularly those roads which serve some remote districts in the country. Well, all those roads are the responsibility of the local authority. It is quite true that in the case of these county roads—it was I who initiated it—the practice is that very substantial subventions are now given to the local authorities to enable them to maintain the county roads as distinct from the trunk roads; but we cannot expect that the local authorities will be relieved of all their obligations in this matter. If they were there would not seem to be very much justification for maintaining the local authorities with their very large and expensive staffs. Therefore, so far as the county roads are concerned, if in the County Louth they are not up to the standard which Senator McGee would like to see obtaining, I would suggest that instead of addressing his remarks to the Minister for Finance, he might perhaps admonish his colleagues on the Louth County Council and endeavour to persuade them to raise a little more money in local taxation and spend it upon the local roads.
Senator Seán T. Ruane spoke about hospitals and sanitation and seemed to blame us for the defects of the staffs of the local authorities or of various engineers and architects and others who had been retained by the local authorities. Surely that is the responsibility of the local authority; and certainly whatever other failures you may try to place on the shoulders of the Minister for Finance or even of the Minister for Local Government you cannot blame the Ministers because the local authorities apparently did not take action to ensure that they would get the standard of service from their officials and from those whom they had retained as specialists which they were entitled to expect.
Senator McHugh had the same sort of complaint. Now surely the Senator  is not so green and simple as to believe that the Minister for Local Government and Public Health, as it was ten years ago when the hospital to which he referred was being built, had any responsibility for building it. It was built by the local authority. The only thing about it was that it was financed out of the Hospitals' Trust Fund; but the central authority had not any responsibility for placing the contract or for supervising it or even for planning the undertaking. It is true that the Minister for Local Government and Public Health would have had to be satisfied that the accommodation which was proposed to be provided would be adequate for the number of patients, but the general detailed planning would be a matter for the local authority; and certainly, if the local authority, having secured considerable sums of money from public sources, allowed that money to be spent with the deplorable results which Senator McHugh has described to us to-day, it seems to me that it is the local authority that is culpable. I do not know if the Senator is a member of the county council, but if so he ought to indict his colleagues at their next monthly meeting for having permitted these abuses to obtain.
The Senator seemed to be, in relation also to a number of other matters, very badly misinformed. We are discussing now the Vote on Account, the amount of money which has to be provided to enable the ordinary public services of the State to be carried on for the next four months; and there is nothing in this Vote about the purchase of a racehorse—nothing whatever—nor are the people going to be taxed in order to purchase a racehorse, certainly not in the next Budget; nor is there any proposal to buy aeroplanes, whether obsolete or of the most up-to-date kind, and the simple Senator, therefore, ought not to be led up the garden path by over-enthusiastic propagandists like Senator O'Higgins. He ought to study these matters for himself and try to find out the truth.
There is no proposal on the part of the Minister for Industry and Commerce or of Aer Línte to purchase planes of any kind. I hope that will  be quite clear. There was a proposal to re-establish a service which had been strangled at birth in 1948, a service which would have been a magnificent dollar earner for the whole of these three years and which would have enabled us to deal much more easily and readily, and with much less inconvenience to the public, with the deficit on our balance of payments last year. It may be a matter of doubt whether we shall succeed in re-establishing it, because it is easy to kill a promising undertaking, such as Aer Línte was and such as it has been shown to be by the experiences of other airlines, but very difficult to re-establish it. In that connection, if the Senator is interested—and, perhaps, coming from Ennis, he might be interested in the development of Shannon Airport—he should see what the Germans are trying to do. They are buying planes. They have set themselves out—they are working 60 hours a week in order to do it, bearing a very much heavier burden of taxation than we are, and living, some of them, literally in holes in the ground—to buy a magnificent fleet of the most up-to-date airliners in order that they may enter what they realise, and what we realised long ago, was going to be a very lucrative source of income for their country and for their people and a very important source of employment for the skilled men of their country. They are lucky because they have had a Government in the past few years which has been looking ahead. We had a Government over three crucial years of our history which was looking backward all the time, or at least, was looking with squint eyes at the achievements of its predecessors.
Now I come to Senator O'Higgins. When Senator O'Higgins speaks, it is difficult to know whether one is condemned to listen to a juke box or a political corkscrew. The Senator has the capacity of a juke box to reproduce interminably worn out records and, at the same time he has some of the characteristics of a corkscrew, that is to say he is in a state of perpetual twist. He told us that the Government had  not done anything to initiate a savings campaign, that we had “to be kicked into it” was, I think, his chaste and elegant phrase, by the Leader of the Opposition. The Government, I think, did a very effective job in initiating a savings campaign when it launched the last national loan and secured subscriptions from the greatest number of people, the greatest number of individual subscribers since 1922. That was no mean opening to a campaign to encourage the people to be thrifty and saving.
Before that, we had initiated a new series of savings certificates. Subsequent to the success of the loan, we had made arrangements to set up a special organisation to induce the public to save and to use all the propaganda methods that might be designed to that end. We had naturally to wait until a building became available. The headquarters of the campaign were opened yesterday. A director of savings was appointed some three months ago, before January last. He had been designated for the post some time before that, and, if the Senator who said that we were kicked into this activity by the Leader of the Opposition, will turn to page 299 of the Book of Estimates for the Public Supply Services he will see there that there is a person holding the rank of senior deputy accountant whose departmental title is that of Director of Savings. That appointment was sanctioned by me before the close of 1952. The Leader of the Opposition, the former Taoiseach, addressed the Fine Gael Ard Fheis on 18th and 19th February, so that, so far as this institution is concerned, I do not think Deputy Costello had anything to do with its initiation. The only thing is that he thought he would get on the band-wagon and try to make it appear that he was leading, whereas in fact he was, like the revolutionary mayor, merely running after the crowd.
The Senator also read a very long quotation from Deputy Costello's speech at the Fine Gael Ard Fheis advocating tax concessions on investment in Irish industry. It is a great pity that apparently the Senator and the Deputy whom he follows are ignorant of some of the provisions  which were included in the Budget of 1932, 21 years ago. They were introduced into the Finance Bill of that year by a Fianna Fáil Minister for Finance and, if I may say so, were severely criticised by the then Cumann na Gaedheal Opposition. They called themselves Cumann na nGaedheal at that time. There is nothing new in this, but the thing that is most astonishing is the fact that, though these tax concessions in respect of income from investments in Irish industry have existed for over 20 years, the Leaders of the Fine Gael Party and the Fine Gael organisation seem still to be unaware of them.
What else did Senator O'Higgins say? He said that I asked the people to vote for Fianna Fáil because General Eisenhower had been elected President of America. That is a proof of what I have said—that Senator O'Higgins is living in a state of perpetual twist—because I said nothing of the sort.
Mr. MacEntee: What I did say—and it is worth bearing in mind when we can come to consider the provision we are making for defence—was that the natural result of the statement which General Eisenhower had made during his election campaign, and particularly the statement he made to the Legion of War Veterans, indicating that if he were elected a very much stronger policy would be adopted towards Russia, the Russian satellites and the Russian policy, wherever it may be found, would be to increase the risk of war, because, if you are to have a hardening of attitude on the one side, which is not responded to by a commensurate softening of attitude on the other, inevitably the possibility and the risk of war become greater. That is all I said.
I think that the experience in the few short weeks General Eisenhower has been in office does indicate the very significant hardening in the attitude of the American Government, in American policy. That is all I said, and nothing more than that. I wanted to point the moral that if war did come  and if the possibility of war were to increase, the people should have at the head of affairs in Ireland the man whose leadership and guidance had been of such inestimable value and benefit to them during the last war. That is all I said.
Senator O'Higgins then referred to the statement made by the Minister for Posts and Telegraphs and challenged the accuracy of the statement which the Minister made, that there had been a fake boom in Europe during part of 1950 and 1951. I am not adopting the phrase “fake boom,” but I am going to address myself to the Senator's explanation of the conditions which developed in Europe at the end of 1950 and the beginning of 1951. The Senator said that, contrary to the suggestion made by the Minister for Posts and Telegraphs, the economic activity in 1950-51 was due to the efforts of certain European communities to repair the devastation of war. It is quite true that the European communities which had been the hardest hit by the war have been using what one might rightfully describe as superhuman efforts to rehabilitate themselves and their countries, but it was not these efforts which were responsible for the sudden expansion in economic activity which characterised the closing months of 1950 and part of 1951. May I say that, because I have, I think, in my hand, a much greater authority on the matter than the Senator?
I do not know whether the Senator would ask to be accepted as speaking with authority on this matter. I think he would agree with me that he has small opportunity and, perhaps, would not be able to devote the time to the matter. I do not question the Senator's ability. Quite the contrary, I do not underrate it, nor overestimate it either. I think he is able and capable of forming a sound judgement on these matters if he would only be sufficiently alert to look at the facts and not try to imagine them. I was saying that I was doubting the Senator's capacity to speak with authority on these matters. I went further and said I had doubts whether the Senator studied them but when I want to know what the peculiar  conditions which existed in Europe were due to I go to a higher authority.
I have here the report of the executive directors of the International Monetary Fund. It is a report for the fiscal year which ended on April 30th, 1952. This is what they have to say about the conditions which exist in Europe in a paragraph which is headed:—
“Balance of payments developments since the outbreak of hostilities in Korea in June, 1950, afford another illustration of the inevitably close relationship between balance of payments difficulties and inflationary pressures. It was impossible immediately after hostilities began to predict confidently the course of events. In fact, speculative purchases, the increased cost of imports, and the expansion of military outlays produced, in a situation where there were already inflationary potentialities, a mixture of cost and income inflation in both industrial and primary producing countries.”
“During the first few months of the Korean war, the upsurge of speculative demand and the consequent increases in the prices of imported raw materials led in most industrial countries to a sharp expansion in bank credit. This expansion was slowed down after March, 1951, by the decline in raw material prices, the tightening of credit and money market conditions, and stronger consumer resistance in reaction to the earlier spate of buying.”
It was not, after all, such a misuse of words for the Minister for Posts and Telegraphs to refer to the conditions which existed during the period 1950-51 as being in the nature of a fake boom. On the contrary, his diagnosis and his description of the situation were more accurate than that which the Senator endeavoured to make.
I want, if I have time, to refer to the Irish News Agency. It is quite true that when the Bill to establish the  news agency was before the Dáil the then Minister for External Affairs, Deputy MacBride, gave certain assurances both to Dáil Éireann and to this House. It is also true to say that no sooner did that measure become law than these assurances were violated and within a short period of time steps were taken to expand the news agency outside the limits within which the Dáil had understood it would operate. The present Government has no responsibility for the violation of the pledges which were given at that time but it does recognise, as Senator Colgan pointed out, that it would, perhaps, not have been possible for the news agency to operate successfully within the very circumscribed limits which the then Minister for External Affairs proposed to impose on it. The only thing doubtful about it is whether it would be possible now, without doing a great deal of damage, to curb the activities of the news agency, it having been expanded, and confirm the rigid limits within which the Minister for External Affairs at that time said it would operate. That was all done with the knowledge and consent of the members of the Coalition Government.
We merely took over the news agency as a going concern in the condition in which we found it. We have no responsibility for it beyond that and, of course, the inevitable duty of having to find the additional £30,000 or £40,000 over and above what it was understood the news agency would cost the taxpayer when it was established.
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