Appropriation Bill, 1984 [ Certified Money Bill ]: Second Stage (Resumed) and Subsequent Stages.

Wednesday, 19 December 1984

Seanad Eireann Debate
Vol. 106 No. 10

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Question again proposed: “That the Bill be now read a Second Time.”

Mr. Howlin: Information on Brendan Howlin  Zoom on Brendan Howlin  I am somewhat at a disadvantage because I was stopped in mid-flight last evening; it was the first time that happened to me because I had hoped to complete my contribution last night. I spoke of the importance of creating an infrastructure whereby jobs could be created and investment, both foreign and domestic, would be encouraged. Clearly it should be the absolute priority of Government to tackle what amounts to the scandal of unemployment.

I take this opportunity to congratulate the Minister for Labour, Deputy Ruairí Quinn, for bringing the enterprise allowance scheme to fruition during the year. I understand 4,700 people, long-term unemployed, have established themselves in business on the basis of that scheme. Equally, I welcome the social employment scheme, which I believe will enrich and enhance the community as well as giving the most vital asset of work experience to its long term unemployed.

It is that sort of imagination and innovation that is required in tackling the horrendous global problem of unemployment. It often struck me as odd that our social welfare system is structured in such a way that we specifically forbid people from participating in the [1069] meagre amount of work that sometimes becomes available to them in order for them to continue to receive benefit. We put down as a guideline that they must be available for work, but bar them structurally from it. I believe that that social welfare system was designed for a different time with different prevailing circumstances. It is time to look in a fundamental way at our employment system and the social welfare support systems to the unemployed. I believe our present Minister for Labour has begun that process and has achieved quite a lot in his 12 months in that office.

I acknowledge that training schemes, courses, and part-time employment, valuable as they are, are no comprehensive solution to the problem of unemployment. Daily each one of us comes across the tragedy being acted out again and again in our constituencies. In the last month we had the agony of Clover Meats, which Senator Kiely mentioned this morning on the Order of Business. Unfortunately, the climate we live in is such that unless businesses are properly structured, properly financed and managed and worked on a co-operative basis between employers and workers, they are under severe pressure.

I touched last night also on education. I stressed the need for a comprehensive system of State education from early nursery right through to third level. I reject the effective privatisation of pre-schools whereby the State has abrogated its responsibility to provide equal treatment for all children. Those who can afford proper nursery education benefit from it but the most disadvantaged — ironically, those most in need of it — are deprived of such education. When children of both these backgrounds come to primary school the advantaged children are leaps and bounds ahead of their disadvantaged companions in every measurable aspect The school system has to try to cope with that and they have a responsibility to tackle fundamental inequality from the beginning. There should be fire brigade action through remedial education and by pouring resources into the system to [1070] combat what is a firmly established disadvantage later on throughout the system.

I welcome the significant start in allocating extra resources to the disadvantaged in terms of the £¼ million this year but the scale of the problem is such that, welcome as this money is, it is totally inadequate. The school system cannot break the cycle of disadvantage on its own; we must have a structured, family support system based on the social and educational services, which can reach out to families in need and try to break the cycle.

Obviously, people are our most important resource but we also need to develop roads, communications, water, power, sewerage and so on because development in those areas would offer the twin advantages of making the economy more efficient and capable of providing jobs for the unemployed and involving the State in employing people. In this context it is very important for me to make as strongly, firmly and as passionately as I can the case for the development of Rosslare Harbour. This national asset is vital to the economy, not only of the south east region but to the nation as a whole. At present there are queues of ships anxious to use this facility but it is in an underdeveloped and underfinanced state to the total frustration of those in the area.

I acknowledge the provision of £300,000 this year for capital works in the area. Unfortunately, our request to the Government for £1 million to provide adequate gangways, covered walkways and proper amenities for passengers, was refused. Passengers on arrival at Rosslare walk on to a concrete slab which is open to the elements and, if we are to attract tourists, we must provide basic facilities in the style of airports to passengers arriving by boat. We have seen example after example in recent years of public money being squandered on white elephants. The Government on coming to office resolved to tackle that problem and said that we could no longer continue on a vote buying spree or supporting lame ducks in constituencies where seats were in jeopardy.

[1071] Rosslare Harbour is a prime example of good, sound, proper and worth-while State investment and yet that asset has been starved of resources. I have repeatedly asked for the formulation and publication of a national ports plan whereby the needs in terms of ports, the resources available and a structured development programme could be worked out and laid before the Houses of the Oireachtas. I appeal to the Minister for Communications to present such a plan. We must not be throwing money here, there and everywhere; we need a structured approach to the problem. Money must not be wantonly spent. However, I want recognition of an area which will be of benefit to the State and will more than repay resources poured into it.

In the context of transport, I wish to underline the importance of sea transport for an island nation. The demise of Irish Shipping is obviously a cause for great concern, especially in maritime counties. I want to stress the importance of maintaining Irish Continental Lines, which is a profitable company contributing to the economy in many ways, not only by directly employing 400 people but by bringing very welcome tourist traffic to the south-east and by purchasing their supplies of food, linen and so on in County Wexford. The value of ICL to the south-east cannot be overstated and I hope that that profitable company will not be jeopardised by the actions of a parent company over which they have no control. I appeal to the Government to maintain ICL not only as a viable entity but as a State-owned, State-run entity, which has a valuable contribution to make.

The health services, health expenditure and indeed the Minister for Health have been increasingly in the news recently. From reading the newspapers and listening to the news one would think that our health services were under attack, something the Opposition would like the public to believe. From the expenditure listed it is obvious that we are maintaining the standards of our [1072] excellent health service. However, we should be aware that there are areas of waste in the public service, particularly in the health service. We should all support the Minister in his endeavours to rationalise our services so that the money spent will be for the betterment of the patients and those who use the health service. It should not be spent in administration or in other ways. We need a more efficient and streamlined service whereby people get value for the money spent. We must remember we are dealing with public money.

I share the view put forward last night of the value of the county hospital. I view the county hospital as of vital importance in providing assistance close at hand to people in need and also in allowing relatives, friends and acquaintances to visit the ill in hospital. To be in your own locality, to be adjacent to your friends and relatives, is a very important factor in your health, well-being and recovery. I acknowledge gratefully the provision by the Minister for Health of resources and moneys to expand Wexford General Hospital and, indeed, build a new surgical unit there. I acknowledge the real achievements of this Government in maintaining social welfare payments in line with inflation. The fact of the matter is that no other government in western Europe has that achievement, even though they are governments with stronger socialist participation, in numerical terms, of course than our own. That is something in which we do not always take enough pride and we do not shout enough about our good, comprehensive social welfare system. It is only on the occasions when one is working with non-nationals who come to this country that one finds out what provision is made for the elderly, or the widowed, or the sick or the unemployed in other countries — many of them far wealthier than our own. One then sees the value of our health services.

I would like to refer to one area of expenditure that does not directly benefit the Irish taxpayer, and I am very glad that the Minister of State for Foreign Affairs is here for this brief remark. That [1073] is the area of overseas development aid. The Irish people have shown in recent weeks their generosity and compassion towards the drought striken areas of Africa. The Irish Government and the Oireachtas have a moral responsibility to respond in kind by taking the moral lead shown by our people, by the ordinary man in the street, and to restore the UN target of .7 per cent of GNP as our contribution. I also mention the efforts of one Irishman, Bob Geldof, in forming Band Aid — a rock pop group who have contributed magnificently in two ways, not only directly raising revenue, which obviously is of fundamental importance, but also by highlighting the problems of the Third World to our young people. I congratulate him and I ask our Government and Oireachtas to take the moral example from him and to restore our former targets. This would give our country the moral authority to lead the developed world in addressing the dire needs of the Third World which can only be met by a planned and continued development programme and not by fire brigade action, responding to urgent, dire calamities when they occur.

There are a few other areas I want to mention. I sat quietly fuming last night when one or two contributions were being made. I want to specifically refer to the comments of Senator Ellis about the appointment last week of our Attorney General. For my own part, I want to congratulate the Taoiseach on his excellent choice of a young, competent, capable, dynamic Attorney General, who, it is hoped, will bring a breath of fresh air into our judicial system, which certainly is in need of that.

Mr. Cassidy: Information on Donie Cassidy  Zoom on Donie Cassidy  The Senator's own party.

Mr. Howlin: Information on Brendan Howlin  Zoom on Brendan Howlin  I want not only to comment on Senator Ellis's remarks but also on those of the Deputy Leader of Fianna Fáil — to use a hackneyed phrase, his gratuitously offensive remarks.

Mr. Smith: Information on Michael Smith  Zoom on Michael Smith  Who is being attacked now?

[1074]An Leas-Chathaoirleach:  Senator Howlin, I do not know what went on last night in the Chamber because I was not present for the speech to which you are now referring. Certainly, I will allow you to make a passing reference to that appointment, but I will not allow you to continue to make a speech on it.

Mr. Howlin: Information on Brendan Howlin  Zoom on Brendan Howlin  I take the point. I have made the remarks that I wanted to make. I shall touch on the area of Justice, if I may. I believe that the appointment certainly will bring new life to the judicial system. I welcome the comments of the Minister for Justice in recent times concerning increased and improved training for the Garda. We have a grave social problem in our society. Most of us were shocked to the core when we witnessed in recent weeks the vicious and horrible mugging and, indeed, murder of old people in rural Ireland. One trait of the Irish character for a long time has been our respect for the elderly. Sadly that trait has diminished and, indeed, vanished from our new society. I would urge the Minister for Justice to allocate whatever resources are required to tackle such hideous crime and to allow our old people in particular the comfort of being able to sleep soundly in their beds at night and to rest in their old age.

I comment, too, on the area of taxation. We have seen in recent times the introduction of one new capital tax, namely the residential property tax. I welcome that, not as enough, but as a start. Practically every contribution made on the Appropriation Bill had some demand for State resources in terms of money that should be spent here and improvements that should be made there.

Mr. Smith: Information on Michael Smith  Zoom on Michael Smith  Including your own.

Mr. Howlin: Information on Brendan Howlin  Zoom on Brendan Howlin  Including my own, certainly. As a Socialist, I am very much in favour of this spending. I do not hide behind the hypocrisy of being all things to all men, willing and anxious to spend money on all programmes, but unwilling to increase taxes or underline where [1075] resources could be got. We have had that heading in the last week from an Opposition party willing to spend at the rate of several million pounds a day —“Name the problem and we will pay for it”. Where we are going to get the money is another story. However, I will state categorically that I am in favour of State spending. I believe that, in terms of financing State spending, there is only one area that needs to be looked at and that is the area of capital taxes. We have the PAYE sector drooping under the burden of taxation right now and yet we have the capital side from which vastly more revenue was being collected in the seventies than now approaching the mid-eighties.

I conclude by commenting briefly on the area of Foreign Affairs and, in particular, on the developments in Northern Ireland over the last year. We have seen the publication of the New Ireland Forum report. That was a brave and adventurous attempt by the Nationalist peoples of this island to set out an agenda, a framework whereby the current tragedy in the northern part of Ireland could be resolved. Unfortunately the response from the British Prime Minister to that work was, to say the least, less than satisfactory. We have a responsibility to continue that dialogue and the only avenue of advancement that can be, that is, the democratic road to discussion and resolution. We must ultimately accommodate all the people of this island. There is no use in us saying that this will be tolerated and no more. We have seen that from all shades of opinion: “everything is on the table but such and such is the only thing I will agree with”. We cannot make progress on that basis. The Government are on the correct path of slow and steady progress in their efforts at discussion and reconciliation between a divided and a strife-ridden people.

In a debate such as this it is difficult to pin oneself to specifics. There is a tendency to go off on a million tangents. We are voting for the expenditure of billions of pounds. The amount is mind boggling. However, it is important in [1076] terms of our responsibility to target each pound for the betterment of our people.

Mr. Cassidy: Information on Donie Cassidy  Zoom on Donie Cassidy  I wish to contribute on two main areas, the first in relation to the proposed extension of licensing hours for the summer months. I was shocked and horrified when I heard of this proposal and I know the dangers inherent in it. I know of young people drinking at early hours in the morning and at all kinds of functions. I inquired as to the reason behind this proposed legislation and was told it would be a tourist incentive. I totally disagree. I have had some experience of the hotel business and I know that tourists who visit this country go to bed extremely early compared to us. I fail to see, from that point of view, how it could attract tourists here. They also get up much earlier than Irish people.

Mr. Smith: Information on Michael Smith  Zoom on Michael Smith  Speak for yourself.

Mr. Cassidy: Information on Donie Cassidy  Zoom on Donie Cassidy  It is a disastrous reason for extending the licensing laws to 1 o'clock in the summer months. We all know the problems there are in relation to alcohol abuse. The third greatest killer in this country is alcohol abuse. We all condemn drug pushers and anyone involved in glue sniffing. We are the legislators and this legislation which has been proposed is very serious. I want to place on the record my opposition to the proposed extension of licensing hours. There are adequate clubs, hotels and other places which give extensions for special occasions. Many people say there are too many of these special extensions granted.

If on a Monday there is an extension granted to 1 o'clock in the morning by the time people get home from it, it is 2.30 a.m. or 3 o'clock. How can they get up at 7.30 a.m. and do an honest day's work? If that is going on for six or seven nights a week, one could imagine the state of the workforce. The Irish are the same as any other people all over the world. If there are extended licensing hours it will be taken that example is being given from the top and people will use the facility.

I am a pioneer but I am speaking on [1077] this as Chairman of the Irish Music Industry. We are totally opposed to this proposed legislation. Who is bringing pressure to bear on the Government and on the Minister to bring in this legislation? I would hate to think it will be brought in by the backdoor. I should like the Minister to clarify the position regarding the proposed extension of licensing hours.

For many years before I became a Member of the Seanad I tried to get various organisations to call on the Minister for Justice to introduce a system of identity cards. They are used in many countries. I have travelled to many countries and in no country is there a greater need for such a system, as far as licensed premises are concerned, than Ireland. Almost 50 per cent of the population are under 24 years of age. I ask the Minister to investigate the possibility of introducing such a system here. It is impossible for a publican or a hotelier to tell if a young person is 15, 16 or 20 years of age. It is unfair to put the onus on the publican and so on to decide what age a young person is. In Canada a person must have an identity card. I strongly recommend that the Minister seriously consider the introduction of an ID card.

We know from the media that week after week young people are killed by driving cars. More often than not, the person was at a function at which there was a bar extension. More than likely the person should not even have been driving the car. If the person was not under the influence of alcohol he or she would have realised the implications of driving the car. We all know that the high risk time on our roads is after closing hours. We know of serious crashes that occur and the fatal or the very serious injuries that result. Sometimes not only one life is lost but two or three lives.

I am totally opposed to this proposed legislation. It would be one of the worst pieces of legislation ever to be considered here. It would not encourage tourists to come to Ireland. That will only be done by competing with prices in other countries. Tourists will go where they will get the best value for money. We have much [1078] to offer to tourists but VAT is killing off the tourist industry as it is every other industry. However, I shall not dwell on that point.

Senator Howlin congratulated Bob Geldof and Ban Aid on their efforts for the Third World. I join in the praise of Bob Geldof, who is a friend of mine. However, I should like to point out, as Chairman of the Irish Music Industry, the needs of that industry here. The Irish music industry has lost over 25 per cent of its workforce here in Ireland over the last two years. In Ireland local entertainers are the victims of grave injustice under existing VAT regulations. Artistes, bands and groups, particularly from the North and England, can come in here and perform free of VAT and they do so in great numbers. This means that they can undercut the local entertainer by 23 per cent, which puts the Irish resident in a totally uncompetitive position and results frequently in loss of local employment. Foreign promoters promote foreign shows here and pay VAT at only 5 per cent, yet if local artistes promote their own shows in an effort to provide an income to enable them to survive they pay VAT at 23 per cent.

In the last 12 months we have seen an influx of artistes coming in here. One of them in Croke Park had an audience of 40,000 people. All of those pay only 5 per cent VAT. If one of those Irish artistes were to run a show himself in an ordinary carbaret venue or hotel he would be liable to 23 per cent. Irish entertainers have no objection to outside artistes or promoters working here. However, they feel entitled to the right to compete for employment and an income on an equal basis.

We welcome the gesture by the Minister in his last budget to reduce VAT on all concerts here to 5 per cent, but we are asking him now to bring all live entertainment under the one VAT rate of 5 per cent. We are doing our best, no matter which Government are in power, to keep jobs going here, but the one thing that is crucifying live artistes here at the moment is the 23 per cent VAT. Artistes can come in from abroad and perform [1079] here free of VAT. If you are living in Lisnaskea you can perform anywhere in the South free of VAT. As the business is so competitive at the moment, particularly because of the recession, it means that we have no chance and we have lost 25 per cent — that is a conservative figure — of our workforce.

This is a specialist area which perhaps not many people know about, but it benefits this country in music and song and has been a great ambassador for this country over the years. When one goes to America, Australia and so on, one sees the success of the Chieftains and Foster and Allen who are known internationally. U-2 record all their music and make all their videos here, and they have been a year and a half doing what they are doing today. Their contract was up three months ago. They decided that they would stay in Ireland and the advance that they got for the next three albums was £5 million. The first album went on sale six weeks ago and in four and a half weeks they cleared the £5 million to the American record company. All that money is coming back into this country and giving employment here. They have the most sophisticated, up-to-date studio in this country. Their's is a specialised business but one with enormous potential for employment and for exports. All the albums and tapes being exported represent work here for people at home, and there is enormous growth in this area.

I ask the Minister to consider seriously the small gesture of reducing VAT on Irish live artistes from 23 per cent to 5 per cent. We are not getting the work here at the moment; the work is going to the foreign artistes. Let me say, as someone who has been concerned in live music for 22 years, that there will be no Irish commercial live industry here within two or three years if something is not done. The theatre people came in here last year and put before the Minister the serious problem that faced live performances on the concert stage. We have seen the Gate Theatre reopen. We have seen an upturn in their business, just because of that 5 per cent issue. There [1080] would be very little theatre left in this city of Dublin had the Government not made that change in the last budget.

Finally I wish you, a Chathaoirligh, the Minister and all the Senators a very happy and holy Christmas. Our slogan for next year is: “Keep music live for' 85.”

Mr. A. O'Brien: Information on Andy OBrien  Zoom on Andy OBrien  In a realistic assessment of the performance of the Government over the last 12 months — they took office two years ago — one must keep an eye on prevailing world conditions and examine how they make things more difficult for the Government than one could normally expect. We must not lose sight of the fact that there is a worldwide recession and, unfortunately, indications are that it is not coming to an end as rapidly as people expected a short while ago. My belief in that regard is that the OPEC countries having agreed to cut down on the production of oil, there is still an oil surplus. If the recession was disappearing and if there was more activity in industry and shipping, that would not be so. However, the recession is still with us and it does not show signs of disappearing overnight. Nobody can deny the difficulties that this recession has imposed on the Government over the past two years and the problems that are likely to be imposed on the country in the foreseeable future.

In addition, the world still has not fully recovered and got into gear, if one might use the expression, from the vast increases in the price of oil some years back which to some degree dislocated the economy of the whole western world. We have not recovered from that, and we are not alone in that respect. The great industrial countries of the west are in the same kind of difficulty.

The Government have an added difficulty in that for years the nation as a whole was living far beyond its means. Money was being borrowed to meet the day-to-day expenses of running the country, and that is admitted on all sides. When Deputy Haughey became Taoiseach and addressed the nation over radio and television on 9 January 1981 the theme of his address was that as a people [1081] we were living far beyond our means. Anyone who gives any serious thought to the question must come to the conclusion that living far beyond your means must come to an end. This Government have taken steps to get the people to live within their means, and in that regard I believe the Government have made progress. If measures to stem the extravagant way of life and fruitless expenditure were not taken we would be in serious straits in a very short time.

It is necessary to curb expenditure in an effort to live within our means. It is necessary also to ensure that the best possible value is got for money spent and to ensure that extravagant action of any kind, whether on the Government front or in the area of semi-State bodies, is curtailed. We cannot proceed with the idea of supporting lame ducks interminably. We cannot continue to nourish the belief that the rest of the world owes us a living and that somebody will come to our aid no matter what predicament we get into. We have to get rid of thinking of that kind. We realise that the difficulties confronting the Government can best be appreciated when we examine the enormous payments that have to be made by way of interest on borrowed money, reaching about £1 in every £3 that comes into the Exchequer.

If we examine the proposals and suggestions made by different speakers that more should be done in certain areas, that more generous allowances should be paid and so on, then we must examine the whole situation. The point is that if we are to spend more money we have either to increase taxation or to borrow more money, and if we borrow more money that in itself will result in an increase in taxation. If we take it that there is general agreement that the level of taxation is too high and general agreement among thinking people that we have borrowed too much, that kind of thinking must shape the thoughts and actions of the Government in their efforts to put things right. In my opinion they have gone some considerable distance on that road already.

Our problem is further aggravated by [1082] the cost of the overspill of violence in Northern Ireland. That adds very considerably to Government expenditure and makes the task of putting our economy on a sound footing all the more difficult. With regard to violence in the North, I believe that establishing the Forum was a very worth-while exercise and that great tribute is due to the Taoiseach for his efforts in initiating it. Tribute is due also to the people who made statements and submissions to the Forum on how they believed the problems in Northern Ireland could best be resolved. The document published was a credit to all who participated in the exercise. It is unfortunate that because of the intransigence of the British Prime Minister headway was not made at the discussions between herself and the Taoiseach on the Forum. That is to her discredit. It indicates a lack on her part of perception of the situation as it is in Northern Ireland and of the likelihood of it becoming worse rather than better because of her attitude.

It is interesting to remember that a couple of months ago the British Foreign Secretary, Sir Geoffrey Howe, said he could understand the aspirations of the German people for the reunification of their country. It is a pity that prominent members of the British cabinet do not have the same understanding of the aspirations of the Irish people for the reunification of their country. Until there is a change of thought in that regard, the situation in the North will continue to deteriorate and the blame must be left fairly and squarely with the British statesmen who failed to appreciate the situation there fully and to take measures to bring it to an end or contribute towards bringing it to an end.

In the same vein, it is remarkable that a British Prime Minister who will not yield an inch with regard to the Falklands or Gibraltar or Northern Ireland is quite prepared to give over Hong Kong to the Chinese. That shows that the thinking of the British is largely controlled by the might or strength of the power with which they are dealing. I trust that the work of the Forum will be fruitful. [1083] I should like also to pay tribute to the Taoiseach and to the Minister for Agriculture for their work in negotiating the price of milk for dairy farmers. It was difficult to convey to the other members of the EC the important role that dairying plays in the economy of this country and to convince them that it was necessary that we would get special consideration. A magnificent job was done in that regard because it was not easy to convince people to pay a higher price for a commodity which was in oversupply already. The Taoiseach and the Minister for Agriculture, Deputy Deasy, deserve the congratulations of the House for their efforts in that regard. It is only fair to say, too, that the success of the Taoiseach at the recent conference of the leaders of the EC in smoothing out the way for the admission of Spain and Portugal is a tribute to his stature as a statesman in Europe and reflects creditably on him and on the country as a whole. It is a tragedy that at this stage the intransigent attitude of the British Prime Minister cut out any prospect of the Taoiseach achieving an equal success in regard to the proposals put forward at the summit.

A number of measures introduced by the Government during the past year deserve special commendation. The latest is the social employment scheme which we have been debating today and yesterday. This is a very worth-while effort. It will do a lot for the morale of people who have been unemployed for a long time. It will give them the feeling that somebody is interested in their plight. Though we are talking only about half time work, we hope that that can be improved on. It is a crushing and depressing thought that one is no longer useful in society. The social employment scheme will do a lot to boost the morale of the long term unemployed and I wish it every success.

Debate adjourned.

An Cathaoirleach: Information on Patrick J. Reynolds  Zoom on Patrick J. Reynolds  I might mention that there is only an hour and a half left for the debate and that there are more [1084] people on this list than will get in in that time. I do not want them blaming me for that.

Sitting suspended at 1 p.m. and resumed at 2 p.m.

Mr. A. O'Brien: Information on Andy OBrien  Zoom on Andy OBrien  Before the break for lunch I welcomed the social employment scheme. There are a number of other points with regard to Bills introduced in the past year, but I know that the time is curtailed and a number of Senators are anxious to speak, so I will be brief.

The social enterprise allowances scheme referred to by Senator Howard last night is a very commendable scheme. The results are very good and I hope they will continue to improve. The Social Welfare (Amendment) (No. 2) Bill, 1984 removes discrimination against women in the social welfare code and it is to be welcomed.

I congratulate the Minister for Education, Deputy Hussey, on setting up the Examinations and Curriculum Board. It is time the school curriculum was examined with a view to turning out pupils with the knowledge and skills necessary today. The report from that board will bring some innovations that will do just that.

As chairman of County Cavan Vocational Education Committee, I thank the Minister, Deputy Hussey, for assisting the committee in acquiring a lease on a wing of St. Clare's Convent in Cavan town. I hope that that unit will be used when the advanced computer course currently running in the Cavan Vocational School is expanded. That will go a long way towards providing young people with the education and skills required today. On behalf of the committee I thank the Minister for her assistance in getting the advanced computer unit in Cavan Vocational School under way.

The restructuring of local government is being discussed at every crossroads. I sincerely hope that more power is given to local authorities. The County Management Act and the abolition of rates, meant that councils had little or no authority to collect funds. Because they [1085] cannot collect funds they depend almost entirely on grants from the Department and the Department decide how the moneys are to be spent. The local elected representatives should have a greater say in the running of their own affairs. I welcome the proposal to change the structures and I hope it will result in greater powers for local elected representatives. That would be some contribution towards badly needed decentralisation.

I welcome the extension of the period of training for Garda recruits. Society demands policemen who have had a good training. The six months course which had been in operation for a number of years, is too short and does not give the recruits the training for the kind of life they have to live when they leave the depot.

The setting up of a number of Parliamentary committees is a very welcome innovation. It affords Members of the Oireachtas more time to probe into the affairs of State bodies and to examine the pros and cons of various issues. I hope the committee system will continue to be enlarged.

With regard to the Erne catchment area, agitation has been going on for a number of years to have arterial drainage carried out. A firm of consultants were appointed to examine the pros and cons of the development of the Erne catchment area, including road structure and so on. The consultants were paid out of funds from Dublin, Westminster and Brussels. Their report was issued a few years ago. I was glad to note that at the second last summit conference between the Taoiseach and Mrs. Thatcher reference was made to this as one of the cross-Border activities that would be likely to be pursued. I hope that at the next meeting between the Taoiseach and Mrs. Thatcher it will be taken a stage further. I do not have to emphasise that drainage is a very big problem in County Cavan and in adjoining counties because of the nature of the soil.

I pay tribute to the Minister and the Minister of State at the Department of the Environment for the grant of £250,000 allocated to County Cavan for [1086] the improvement of access roads to places of interest to tourists, anglers in particular. In many areas of County Cavan the only access to some of the lakes — amongst the best in Europe — is by a narrow roadway only going part of the way and then the tourist has to get a farmer's permission to cross his land to get to the waters edge. As a result of the grant, in a number of cases an access road was provided from the main road to the waters edge. That is a great convenience to tourists. They have expressed their satisfaction with the improvement. I hope the scheme will continue for another while as there remains a lot of work to be done in that regard. In general the lakeland area, which consists of counties Monaghan, Cavan, Leitrim, Fermanagh, Roscommon, Westmeath and part of Meath, has great potential for tourism development, but it has been neglected in the past. Roadways and simple amenities to attract visitors have not been provided. I am glad to see that a beginning has been made this year. I should like to pay tribute to the work done in the development of Killykeen Forest Park. Now that a beginning has been made on development, I take it for granted that it will be continued.

I express the sincere hope that more areas in County Cavan will be included in the proposed extension of the severely handicapped areas for headage payment. A small part of County Cavan was included in earlier schemes. I know the Government have carried out an intensive survey of big areas of the country and that they have made submissions to Brussels. I can only hope that these submissions are successful. There are a large number of areas in Cavan that meet the three criteria for inclusion: poor quality land, low farm income and a falling population.

I have a list which I do not propose to read in full. There are areas in Cavan which should be included. We have 11 areas of extremely low stock, ten areas of very low stock, and 11 more of low stock. Some of these are in the part of County Cavan which was the only area [1087] in Ireland that showed a drop in population in the last census as compared with the one immediately before. There is an unanswerable case for the inclusion of further areas in County Cavan in this scheme.

It should be looked at from another point of view. These extra headage payments for people who have produced stock in these handicapped areas are an inducement to more productivity. As the unemployment assistance scheme is operated now, with a man's income being assessed, there is a danger that that would be an incentive to under-utilisation of the land. There are areas where it is more than difficult for farmers to eke out a living even after very hard work and careful husbandry, and the strongest possible case should be made for including them in the severely handicapped regions.

Our principal hope for a higher standard of living in Ireland is the elimination of waste in every sphere possible and greater productivity. Anything that can be done to increase productivity will have beneficial results for the State as a whole. It is the wrong approach to expect reliefs in budgets and greater improvements in the standard of living for different sections of the people. The standard of living available to people depends on industry, efficiency and the total elimination of waste and mismanagement, and a steady increase in productivity.

I hope that the Erne drainage scheme will be completed and that the full potential for agriculture in the catchment of that river will be attained. The development of tourism which is our third most important industry would be a great help to the economy of the area and to the national economy.

Mr. Smith: Information on Michael Smith  Zoom on Michael Smith  A Leas-Chathaoirligh, I wish you and the Cathaoirleach, the Clerk, his assistant, the staff of the House, Members, the Minister and his civil servants and members of the press a very happy Christmas. I want to congratulate the Leader of the House on the record number of sittings in this session, starting in the heat of the summer with [1088] the Criminal Justice Bill and ending this afternoon. Perhaps we did not always have the business which we would like to have. Legislation was quite slow coming from the Dáil. Nevertheless, good work has been done and we hope that, in the new session if the Dáil is unable to deal with Bills, we will have an opportunity to process them here.

The debate on the Appropriation Bill is something akin to the Adjournment Debate in the other House. Independent commentators have said the Government are bogged down, uncertain of themselves, bewildered and have lost their way. These are not comments made by members of Fianna Fáil. They were made by people looking at the performance of the Government and assessing them. That is how they see the Government. There was a time when one categorised that kind of general paralysis of Coalition Governments as a problem which related to two parties, unable to synchronise, and unable to achieve the cohesion necessary for a successful Government.

The Labour Party have lost their way and thrown in the towel. Therefore we have to focus attention on the main component in the Government, the Fine Gael Party. They are battered and shattered by a liberal metropolitan wing on the one side and, on the other by the right wing, Deputy Oliver Flanagan and Deputy Alice Glenn, with the odd skirmish from Deputy Kelly. That party have lost their way. In his wars one of Napoleon's strategies was to divide his army and approach his enemy from four different angles. I read with interest Deputy Kelly's contribution in the Dáil in which he attacked the leader of Fianna Fáil for hitting a man when he was down. That was an oblique attack on his Leader by Deputy Kelly.

An Leas-Chathaoirleach:  Before you go on, Senator Smith, I do not think it is correct for you to make a speech about Members of the other House. You can make references.

Mr. Smith: Information on Michael Smith  Zoom on Michael Smith  I bow to your ruling and experience in the matter. I was trying to indicate why we have this uncertainty and [1089] lack of cohesion, a sense of unease and a sense of hopelessness in political life and in all sections of the country. Our local authorities are practically bankrupt. Our health boards are floundering. We have had liquidation after liquidation as the economy has gone on a downhill slide. Most public representatives are concerned with making contacts with foreign embassies. Only this week I was in touch with the embassy of the United Arab Emirates in London on behalf of young people trying to find employment opportunities there. It is pathetic that the Minister for Finance should come here and say that unemployment has been arrested or that the Government have succeeded in stopping the upward spiral of unemployment. The unemployment problem has been partly alleviated by emigration. A figure of between 10,000 and 15,000 for this year appears to be a fairly accurate assessment and this is a very sad spectacle.

I agree with the Minister for the Public Service that public service pay is a critical factor in the overall management of our economy. One can imagine the beleaguered public service pay arbitrator trying to work out a judgment following painstaking discussions with the unions and all the other parties involved, taking into consideration various submissions made and the comparability claims. One cannot imagine his task being made any easier by the insensitive decision made recently by the Government in relation to pensions for the Judiciary. I am not saying that these pensions are not justified in some way. Members of the Judiciary may feel they have lost out and that they are making legitimate claims. I am commenting on the insensitivity of introducing a Bill in the Dáil to grant further concessions to people who by any criteria enjoy a reasonably high standard of living at a time when many other sectors have taken a very substantial drop in income and have had to do without increases in their wages or salaries to compensate for inflation or for the fact that income tax allowances have not been index-linked. The Government in their [1090] own interest and in the interest of bringing to fruition settlements in relation to public service pay should try to avoid introducing legislation to confer advantages on groups which are already doing relatively well.

The situation was further exacerbated by developments in Brussels in relation to the outgoing Commissioner. This may not come within the ambit of the Government's responsibility but it adds to the problem. His appointment as Vice-President for a very short period gives him a very substantial pension advantage. One must consider the reaction of the ordinary person who may have lost his job or who may have retired after 30 or 40 years work in Bord na Móna or elsewhere. What does it do for the democratic system? How does it affect the cynicism which has been developing over the years in relation to people in Government and public life generally? Many of us feel that this cynicism is unjustified and unfair to those of us who work hard and try to make a reasonable contribution. We must accept that if we continue to travel down that road we will be hoarding up problems for the future.

I listened to the Ombudsman, Mr. Michael Mills, make the case to the Government and particularly to the Minister for Social Welfare that a Bill should be introduced to remove the anomaly whereby people who were in insurable employment prior to 1953 and have more than ten years consecutive social welfare payments do not qualify for a contributory pension, whereas somebody who has ten years continuous PRSI contributions in subsequent years will qualify. There is no rush to bring in a Bill to deal with this anomaly. Many people are keenly aware of this.

I am not trying to score political points. The Government have a majority and they can govern for the next couple of years. It is in their interest and in the national interest not to exacerbate our problems and to cater for those in society who are in greater need. Ministers coming back from Brussels talk about imminent break up, financial crises, impediments in the way of production of [1091] one agricultural product or another and small dairy farmers not being able to increase cow numbers even by one, while at the same time the Commission are able for their own reasons to confer the advantage to which I have referred.

One cannot but think about the many thousands who are unemployed and the problems that affect these families. We must consider what can be done to raise morale and introduce new schemes and employment opportunities. I have said in this House on a number of occasions that as long as our population is increasing we will encounter ancillary problems, a drift towards drug addiction and into crime, involving a savagery and sadism of an unprecedented nature reaching out to rural areas which hitherto were reasonably safe. This is bound to happen no matter how much training the gardaí are given or how much we revamp the court system or increase expenditure by the Department of Justice. I do not forget what is happening in our cities or the experience of old people who are afraid to open their doors after dark. We need to have a community consciousness and pride and a type of neighbourliness which the materialism of the sixties and seventies watered down. We can help to solve this problem by such things as providing easier access to pensions and ensuring a greater Garda presence on the beat. All that will not be enough unless we do something about employment and foster a caring society with particular regard for old people living alone.

I listened to the Minister for Health on the radio when he said there was no problem, that people could have money in the bank and that they should be advised to lodge money in such institutions. However, the problem is not as simple as that. As most people in public life know, it is not the question that a person will have to pay income tax or that his pension will be reduced: it is a lack of understanding with regard to documentation. The number of forms sent to people confuses them and they are unable to cope. Unless they are helped by the community I doubt [1092] if legislation, however sensitive, will be able to help.

I wish to say a few brief words with regard to the northern part of our country. Most of us felt let down by the Taoiseach's performance at Chequers but he is not to blame for the intransigence of Mrs. Thatcher. During the years the British Government have pursued a malignant policy in relation to the North of Ireland. They have never wanted to get to the core of the problem. All the Nationalist parties came together, thus making history, in an all-out attempt to put forward the kind of policies that might lead towards a solution to this long, tragic and historic problem.

The Forum report was before the British Government for six months but the British Prime Minister chose after the Irish-English summit to say the horrific words, “Out, out, out”. That caused considerable frustration and even the most moderate minded people who saw her performance on television could not be blamed for thinking that sometimes the only solution is to resort to violence. I could never support that but I can understand how there has been a desperate feeling of frustration. There have also been problems as a result of the introduction of the supergrass system which has caused alienation in the North.

As far as we are concerned in this House, we do not want to say anything that would make the task more difficult. However, it has to be said that we must take a firmer line. It is beyond question that for some reason or other the British Government are not anxious to support the measures and the proposals put forward by the Nationalist parties. We must be ready at all times to make whatever progress is possible in the short and in the longer term to remove the difficulties and the tragedies that are tearing communities apart and which are shattering the economic fabric of the North. All of these problems become even more insoluble when the British leadership is not prepared to take some radical steps to heal the rift as Britain has final responsibility in the matter.

[1093] At the recent summit in Dublin overproduction of wine in Europe, particularly in the light of the impending entry of Spain and Portugal, was high on the agenda. Despite the action programme introduced in 1980 by the Commission, production of wine continues to increase while consumption has been moving in the opposite direction. It is now costing the Community almost £700 million to store this unwanted wine in intervention. There is no long term solution in buying up surpluses of wine and storing them in intervention. The wine lake must be eliminated and realistic and biting policies have to be introduced. In the context of the accession of Spain and Portugal to the EC, the growing power base in southern Europe and pressure for the spread of the Common Agricultural Policy to cater for Mediterranean products may threaten and further curtail support for our main agricultural products. We must be vigilant and strong in defence of our own interests.

I was sorry to note in the papers in recent times that the Government are proposing to reduce grant aid to sporting organisations. I make a special plea to the Minister to ask him to ensure that we do not reduce the level of Government support for voluntary groups and individuals who do so much work for young people. In the light of our unemployment problem, we need to provide the maximum number of recreational outlets and facilities for young people. Many groups give all of their spare time towards this goal and they need encouragement and support. The Macra youth organisation and other parish groups have availed of youth employment and AnCO schemes to provide community and recreational facilities and I wish to pay tribute to all concerned in these developments. They have succeeded in creating community pride and a sense of involvement. Many of the youth employment and AnCO schemes are welcome and should be encouraged.

We must ask ourselves how we can use the energy and the untapped resources of our young people to help combat unemployment. Should we not look at our third [1094] level education system because it does not seem to be catering for the entrepreneurial spirit and the capacity and belief in young people that they can provide jobs for themselves. Most young people see themselves working for other people but the banking, finance, transport and administrative sections have been drying up so far as jobs are concerned. More opportunities will be found in small industries whose objective is to replace imports. We need to create a stronger bond between the schools and universities and life in general.

Sometimes I think that in the whole structure of our grant aids we need much closer liaison and understanding of what is happening in the markets. Recently a Shannon-based industrialist, a Tipperaryman, who has a very thriving enterprise, assisted a local community in Tipperary to establish a small industry. How did he do it? Because of his contacts in Germany he was able to find out what a product which we were importing would cost at base. From his experience he considered whether we could compete in this product. He was satisfied that we could and therefore he founded this small industry. Industrialists, particularly small ones, who travel out of the country to market their products, are the kind of people the IDA need to be more in touch with. Those people are on the ground and know what particular industries need, particularly in regard to servicing them. It is a tragedy that when we go into shops this Christmas and select the smallest of items, from a pencil to anything else, we find that they were made in Japan, Germany, France or elsewhere.

We must believe that we can do this ourselves. We must gear our education system to direct people in this direction and get them to believe that this is the way forward for our economy. We must teach the philosophy that we should not expect that at the end there will be so much for one and so much for the other. I do not think that would have wide acceptance but I am afraid it is necessary.

The White Paper on Industrial Policy [1095] emphasised the key role of small industries. About 80 per cent of manufacturing industry here employs fewer than 50 people and is Irish-owned and Irish-managed. All the time we need new ideas but I do not think we will get them by having the IDA sponsoring displays to which people are invited to discuss their ideas. It may help, but in many cases it is out in the market place that we will find the ideas, among the business communities in Europe, wherever the advantages are. We have a young industrial base but we have horrific unemployment. We have to be able to experiment, we have to be direct about it and we must be directing our people towards new ideas so that we will become commercially viable and that our products will have a reasonable prospect of success.

Sales of Irish dairy products abroad this year exceeded £1 billion. This is most encouraging. These sales have not been helped by intervention, they have been made on the open market, and this is a marvellous advantage. I congratulate Bord Bainne and the co-operative movement on this achievement and I urge the Government as well as these bodies to remember that we still place too much reliance on butter and skim milk powder. More than 80 per cent of our milk production goes into them, despite most people in the business knowing that that percentage is too high. We must provide funds for greater research into high added value alternatives in the dairying industry. This will take time but if we shy away from it we will have a painful future for the dairying industry on which nearly all of our beef and agricultural production depend.

We need a research programme on biotechnology mainly concerned with new food products by modifying milk protein and cheese manufacture.

Yesterday, Senators referred to our huge food import bill, said to be about £800 million annually. I do not think that figure takes into account that a considerable proportion of those imports comprise items which we do not produce ourselves and would not have the time to [1096] produce. However, our food imports are at an unacceptable level. Half of these imports should be replaced by home-produced goods. We must appreciate that about £200 million worth of our imported food products do not have native rivals on our shop shelves — there is no comparable Irish product. That is very sad. At the minimum, £400 million worth of the food we import could be replaced by home products.

The world of food technology is changing. Advances in science and technology have taken a haphazard industry and made it into a highly competitive and intensive business in other food producing countries and when there is such an urgent need for new employment we must get on that road immediately.

I do not know what to say about the speech of the Minister of State, Deputy Connaughton, in relation to a new Bill he is to introduce in regard to controlling and tilting the balance in favour of fulltime farmers when land comes on the market. He proposed State backing for group purchases and strict regulation of new entrants. Not long ago the Government decided to abolish the Land Commission and introduced proposals for a land tax. They specifically stated that the 270 inspectors in the Land Commission would be asked to work on the task of valuing land for land tax. The Government transferred the estate agents in the Land Commission to the Department of Social Welfare.

Whom does the Minister of State think he is codding? He has abolished the Land Commission, he has found a new job for their inspectors and he comes now to tell us that in the new year he will introduce a Bill which will back-pedal on everything he has said. A previous Bill on land leasing was introduced by the same Minister when we did our best in this House to deal with the areas now being covered in order that the consequences he predicted would not follow and which we alleged would in relation to land purchase. On the Minister's admission half of the land purchased last year went to non-farmers. Speculative land purchase has been a feature for some time in scenic and other [1097] areas along our coastline by foreigners and other EC nationals. At this belated stage I would appeal to the Minister to reconsider the position even though it may appear to be back-peddling on what he has done or be totally in conflict with the embargo on recruitment to the public service. Perhaps he would say how he visualises managing a position in which inspectors will be expected to perform two or three tasks simultaneously. I still welcome the Minister's belated conversion to the Fianna Fáil White Paper on Land Policy.

I want now to refer briefly to the closure of Clover Meats Limited in the context of the numbers of people and members of the farming community who suffered heavy financial losses through that tragic development. In the course of replying perhaps the Minister would indicate whether the Government have any proposals to introduce a bonding system. The position already is that when cattle are slaughtered payments are made in respect of veterinary fees by the CBF, the meat marketing board. In the light of the catastrophe that occurred in Clover Meats Limited and its effect on a large number of farmers, could some system not be introduced whereby small payments would be made on the slaughter of animals in order to take account of such eventualities? Obviously one would not want to encourage people to take management decisions in the knowledge that a rescue package existed so that their tactics might be so coloured. But if such a scheme could be introduced in a controlled way it would be a welcome development.

I want to make a brief comment on the tax situation and to appeal to the Minister to endeavour to come to grips with what is now a morass. It constitutes a factor in the problems confronting us in that many people believe themselves to be and find themselves overtaxed. This feeling has crept into top management, at the upper band of 65 per cent, plus levies, which constitute a crippling burden and could remove all incentive from that top management and industrial scene individuals who are badly needed in our present [1098] economic climate. There is also the failure on the part of the Revenue Commissioners to collect moneys from a variety of sources from which allegedly it is due. That is through no fault of the individuals concerned in the Office of the Revenue Commissioners because any with whom I have been in contact, making representations on behalf of constituents, would appear to have been over burdened, working under fairly severe restrictions. But it is not good enough that situations should be allowed to develop in society in which old age pensioners are taken to court because of their inability to pay water charges while at the same time places like “Durty Nelly's” or others close owing perhaps a couple of a million pounds in PRSI payments. Any of us who may be in arrears in respect of such payments will receive letters very quickly from the Revenue Commissioners. Therefore why should some groups be allowed evade what would appear to be their due debts?

Neither was it good enough for the Central Statistics Office to have a cockup in relation to a straightforward addition in regard to the milk super-levy. There is also a problem obtaining in relation to our value-added tax payments to the EC when the CSO figures varied from those eventually computed by the appropriate traders. Is this another area in dire need of revamping? We do not collect sufficient data. We must have an outmoded method of processing it. It is not good enough at a time when there are available so many technical instruments for its compilation that such developments or mistakes should occur. I would suggest to the Government that if they are to make any mistakes during 1985 they ensure that they be mistakes involving underpayment rather than, as always, overpayment. The Civil Service generally might take note of the dominant attitude in some parts of the country by which one does not pay until one is absolutely sure of the figures.

With regard to tax and value-added tax generally the daily convoys of shoppers to the north of Ireland and the decimation it is creating in our Border towns is a [1099] matter for concern. It should be noted that it does not involve merely the movement of people from areas close to the Border. A friend of mine in Cork city informed me recently that buses leave that city also for Newry. When a situation reaches that stage, it is the responsibility of the Government to take preventive measures which will at least eliminate some of the problem. We are unique in Europe in that we have six rates of value-added tax. As far as I am aware we are unique also in regard to some of our higher levels of taxation on goods regarded as luxury items but which are not so regarded anywhere else.

Since it is Christmas time I should say that from my experience of public life never have I been so confronted by so many problems affecting the so-called new poor or poor people generally. It appears that the ranks of people unable to cope, to sustain themselves and their families in any degree of comfort continue to swell not merely because of the closures, liquidations and problems affecting industry experienced by people in top management but also in other areas where people encounter mortgage repayment problems and so on. I am sure most other public representatives are having the same experience. With practically 54 per cent of the live register now in receipt of long term assistance or benefit it would appear that many more people are finding themselves in the poverty trap unable to cope. I would exhort the Minister to do everything possible to ensure proper payments of benefits, and not be tricking around with systems which we pretend will make things a lot easier, such as, for example the family income supplement scheme. When that scheme was announced, in the aftermath of the abolition of the food subsidies, the Government told us it would be backdated to September last.

They told us that about 35,000 people would be eligible for it but as far as I am aware not even a quarter of that number have applied for it. Before the scheme [1100] was introduced the Government technically abolished it when they announced that they would abolish the tax free allowances for children on the introduction of the £30 child benefit scheme. All parties from time to time made the same mistake in regard to many schemes. In regard to this, and many other schemes operated by the Department of Agriculture, there is a need for tidying up. We need to make them more straightforward, less bureaucratic, more open and easier to understand. We must ensure that ordinary people can understand them. When one takes into consideration that the Government have abolished the food subsidies and intend to remove the tax allowances for children one can see that there will not be much benefit to be gained from the new scheme. Let us not have a new list of schemes to cater for these anomalies. We should aim for a more straightforward approach to the social problems that flow from unemployment and different social disorders such as martial breakdown. They may not be new but they are on a scale not previously experienced here.

I should like to conclude on a parochial note. I am concerned about a Bord na Móna strike that is hitting the Littleton and Templetuohy areas of north Tipperary. Bord na Móna is an organisation we have all been proud of. It has made an enormous impact on the industrial and domestic life of the midlands and areas where there is little else but bogland. Bord na Móna topped £100 million last year and made a profit of £12.7 million. The strike I am concerned about has been going on for six weeks and it is now proposed to let workers go. Some of them have given tremendous service to the company and I should like to ask the Minister for Labour to intervene to ensure that the Labour Court and conciliation procedures are exercised in an effort to settle the dispute. I should like to ask the Minister to request the board to show the maximum amount of goodwill. It is not only affecting those on strike but is spreading through the system with many other workers being laid off. In fact, some workers were laid off last [1101] week. With so much scope for expansion for Bord na Móna it is regrettable that they are embarking on this course.

An Cathaoirleach: Information on Patrick J. Reynolds  Zoom on Patrick J. Reynolds  I should like to mention to the House that in accordance with the Order of Business only 25 minutes remain for Members to contribute. I understand that at least three Members are anxious to contribute in that time.

Mr. M. O'Toole: Information on Martin J. O'Toole  Zoom on Martin J. O'Toole  On a point of order, I should like to point out that it will not be possible to cater for all speakers. I do not think the Chair can curtail the debate. We have been waiting since yesterday to contribute.

An Cathaoirleach: Information on Patrick J. Reynolds  Zoom on Patrick J. Reynolds  This matter was mentioned on the Order of Business this morning. At that time I paused. The matter was mentioned again before the luncheon adjournment. I am afraid I cannot help the Senator. I was anxious to accommodate all Members but an agreement was reached on the Order of Business.

Mr. M. O'Toole: Information on Martin J. O'Toole  Zoom on Martin J. O'Toole  We have been waiting since yesterday.

An Cathaoirleach: Information on Patrick J. Reynolds  Zoom on Patrick J. Reynolds  The Senator should have been here this morning at 10.30 to protest or before the luncheon adjournment.

Mr. M. O'Toole: Information on Martin J. O'Toole  Zoom on Martin J. O'Toole  We were here.

An Cathaoirleach: Information on Patrick J. Reynolds  Zoom on Patrick J. Reynolds  Will Members agree to confine their contributions to five minutes?

Mr. Fitzsimons: Information on Jack Fitzsimons  Zoom on Jack Fitzsimons  I am not being critical of the Chair but I should like to know if it will be possible to resume the debate after the Recess to give all Members an opportunity to contribute?

An Cathaoirleach: Information on Patrick J. Reynolds  Zoom on Patrick J. Reynolds  There is nothing I can do about that. The Bill must be passed before we adjourn.

Mr. Kiely: Information on Rory Kiely  Zoom on Rory Kiely  I understand that last year [1102] a similar Bill was passed before the Recess but was debated subsequently.

An Cathaoirleach: Information on Patrick J. Reynolds  Zoom on Patrick J. Reynolds  If we do wrong one year there is no reason why we should do wrong every year.

Mr. Kiely: Information on Rory Kiely  Zoom on Rory Kiely  It did happen last year.

An Cathaoirleach: Information on Patrick J. Reynolds  Zoom on Patrick J. Reynolds  Unless all Members confine themselves to five minutes I cannot help them.

Mrs. McAuliffe-Ennis: Information on Helena McAuliffeEnnis  Zoom on Helena McAuliffeEnnis  I regret that I will not be able to confine myself to five minutes. I got involved in a similar argument some time ago on the national plan. When there is a limited debate all speakers should be confined to a specific length of time.

Mr. Kiely: Information on Rory Kiely  Zoom on Rory Kiely  I do not wish to interrupt the Senator but I must point out that if we thought that there would not be sufficient time for all speakers we would have asked for extra time today. It is all very well saying that we should have protested this morning but we could not foresee this happening.

An Cathaoirleach: Information on Patrick J. Reynolds  Zoom on Patrick J. Reynolds  In accordance with the Order of the House I will be calling the Minister to reply at 3.30 p.m.

Mrs. McAuliffe-Ennis: Information on Helena McAuliffeEnnis  Zoom on Helena McAuliffeEnnis  The year 1984 has been an unusual one. It has been a year of new definition. To explain my point, I should like to tell a story. We are all familiar with former Minister Jimmy Tully. Once a month Deputy Tully used visit Westmeath on business. When his business had concluded he used call to our house for lunch. I can recall roughly 22 years ago after lunch lining up in our hall with the other children for the usual 6d or whatever the contribution was and hearing Deputy Tully saying to my father: “I fear that with mechanisation we will never see full employment”. In the following 22 years Fianna Fáil were in power for two-thirds of the time and we have had disastrous unemployment. That did not arise overnight. It has been happening over the last 22 years and [1103] before. In 1984 we now have a new definition in terms of employment. We have proposals for a social employment scheme offering employment on a part-time basis. There has been talk of early retirement to make way for new people and a lot of talk about job sharing. That is a new concept and represents an air of reality when one realises that there are not sufficient jobs to go around.

From the point of view of the Labour Party, 1984 saw a new concept being recognised, the concept of the National Development Corporation. The IDA help industrialists with plant and funds but under the NDC there will be a change in emphasis. The State will choose areas with a view to intervention and then match personnel to the idea.

As far as Fianna Fáil are concerned, 1984 meant the revival of old definitions. I have heard more in 1984 about the tragedy of emigration in the fifties than I heard for many years. We have heard such statements as, “the children of dear mother Ireland are being exported just like in the fifties.” That is the catch-phrase of the day. I have two observations to make about that. Fianna Fáil were in power in the fifties and we had to wait 34 years for them to admit their failures then in terms of employment and keeping our young people at home. Will we have to wait a further 34 years for them to admit their failures and disasters based on the 1977 manifesto? We will not. Promises were made in 1977 and, as the Tánaiste, Deputy Spring, pointed out, in 1984 at the rate of £10 million per week.

Mother Ireland, to quote Fianna Fáil, has been badly abused by Fianna Fáil and, based on what they said in 1984, mother Ireland will never survive their coming back, go fada linn an lá.

Senator Ellis commented on the Government failure in areas of cross-Border trading, and Senator Smith also criticised the Government for this. I remember not so very long ago when £1.75 was taken off the price of a bottle of spirits and the catch-phrase orchestrated by Fianna Fáil at local level was “Good God, they take down the price of [1104] whiskey and put up the price of bread”. Is this effective opposition? I do not think so. To me it is another Irish joke.

Fianna Fáil should cop on to themselves. Words like “emigration” give the impression of our young people leaving never to return, a little like the old pied piper fairytale. This is not so. When I hear the platitudes, mother mo chroí, dear old Mother Ireland, the Emigrant Ship and so on, I feel like doing something totally uncharacteristic, that is, stamping my foot. This is 1984 and we are in Ireland, Europe. We have a young vibrant, modern population. This is the space age and we are hours, not years away from America. I know many young people from my area who have gone happily to greener fields for a while. They are less than a day away from home and they are doing what many people would like to have done in their young days, that is, have a fling before settling down to responsible adult living. Stop using these emotive words and instead put forward concrete proposals providing work for these young people on their return. To use a well coined phrase, I am asking Fianna Fáil where is the beef, besides Libya?

Mr. M. O'Toole: Information on Martin J. O'Toole  Zoom on Martin J. O'Toole  We are not in Government.

Mrs. McAuliffe-Ennis: Information on Helena McAuliffeEnnis  Zoom on Helena McAuliffeEnnis  That does not debar Fianna Fáil from putting forward good proposals which the Government can take up and put into operation.

I have heard talk about health cuts. I telephoned some friends, one of whom is involved in private industry on a national level. They too are cutting back, but they are not cutting back on the shop floor. The health boards say they have to close wards or units, or let doctors and nurses go and so on, but there is not a word about cost-cutting at administrative level. Perhaps the health boards should have a policy similar to that followed in the private sector, that is, look at administrative level before looking at the shop floor.

I wish to refer to two areas which are of particular significance to rural Irish families. The first is the abolition of the [1105] Land Commission and the second is the closure of the rural home economics colleges. In my view these actions undermine the importance of the farm family unit itself and the contribution the farm family can make to what I would call farm based enterprises. Let me deal first with the Land Commission. There has been a campaign over the years to have the Land Commission abolished — and I was scandalised by the part the IFA played in this campaign — but there was a certain amount of justification for criticising the commission. Over the last 20 years there was no policy input; it was financially drained and bureaucracy was the order of the day leading to inefficiency and tardiness. Furthermore in my view, their operations were tainted with political hackery and this was blatantly obvious at local level. But we must also remember the good work done by the Land Commission when it functioned as it should have done mainly in the area where people on land which did not yield a sufficient living were moved to farms of good workable land. The only fault was that the farms to which they were moved were somewhat smaller than ideal. They also took land into their ownership which was held by absentee landlords and divided it — not always, I am afraid, under proper guidelines — but they helped to get rid of this effective control by a small group of our greatest national resource.

With the abolition of the commission there are two areas under serious threat — the smaller family unit which depended on the Land Commission in many cases to expand to viability, and the old absentee and resident landlords who may facilitate a growing number of what are derelict sites. So what is needed? We need the Land Commission with its constitutional powers of acquisition but the Land Commission have gone and the new words being used are land agency or land authority. Rather than nit-pick I will stick with land agency. We need an agency in place of the old Land Commission which will have constitutional powers of acquisition. We need an agency which will identify potentially [1106] dynamic farmers or people with agricultural qualifications who would put land to its best use and thereafter facilitate them with access to land. We need an agency which will act to control land mobility in terms of sale, particularly where land is relatively cheap and we need the agency to oversee and promote the leasing of land into productive hands. The agency should also take structural initiatives to encourage experiments in areas like leasing land to landless graduates or piloting in the food area. For example, we had before the House some time ago the national plan and one of the central areas mentioned was the development of the food industry.

The second area I mentioned as undermining rural life was the closure of the rural home economics colleges. These colleges were closed because the necessary funds of £500,000 were not allocated. ACOT contributed to their closure by pointing out that the colleges had ceased to function. Let us look at some figures. On the three year farming course, which is open to males and females, 142 persons participated in option one of the course, 134 males and eight females. In option three, 300 people took part, 294 male, six female. It seems that whatever Departments, ACOT or anyone else say, women do not see these courses as a feasible alternative to courses presented in the rural home economics colleges. I know the courses run by these colleges were somewhat outdated and overtaken in some areas by the Department of Education, but what was needed was restructuring, not closure.

In the light of the recent EC directive on equality for women in self-employed occupations, it is worth noting that the directive emphasises the importance of the recognition of the contribution by the spouse of work done in the family business or farm. Furthermore the European Parliament recognise that the work of the spouse cannot be treated seriously unless the spouse is qualified, and by implication the European Parliament recognise that rural women in particular [1107] are denied access to training which facilitates living within their own environment.

Earlier this year I submitted a programme to the Youth Employment Agency which is best described as rural enterprise development. I am disappointed that an allocation was not made in 1984 for the implementation of this programme and I here and now call on the Department of Agriculture and the Youth Employment Agency to approve funding for this course early in 1985. The course is presented as an attempt to preserve and upgrade the role of rural women in the context of modern life. In the recent debate on the subject in the Dáil many interesting and enlightening facts were revealed which clearly showed that the colleges were closed for no other reason than as a part of a cost cutting exercise.

The Minister of State at the Department of Agriculture, Deputy Hegarty, said:

The decision of the Government has been taken in the light of the constraints on our Exchequer.

The Minister of State at the Department of Agriculture, Deputy Connaughton, said:

There is a new trend sweeping across Europe in the whole area of rural enterprise projects. At a time when our unemployment figures are so high we should take a new look at such matters and that could include the RHE colleges. Through the Youth Employment Agency and others, a system could be worked out where the greater commitment of those in the rural home economics colleges will be put to full use.

I spoke to a lady from The Irish Times who spent many years looking at rural enterprise projects. She said that Irish shops, delicatessens and supermarkets were nervous of stocking supplies from home producers for various reasons — hygiene, quality and consistency of [1108] supply — but if they were given guaranteed assurances and control, reliable supply and delivery, coupled with proper costing and packaging, the demand would be massive.

I need say no more other than I hope that this time next year I will be in a position to congratulate the Minister for having implemented this programme. Let 1985 be a year of experimentation. That is basically what I have called for. What difference does it make if mistakes are made so long as progress is achieved in the long run. Perhaps the best way to sum up would be to say that Alcock and Brown did it. Alcock and Brown flew what amounted to paper and wire from the USA to the bogs in County Mayo. If they had not done so because of fear or lack of adventurism, what would have happened? They did not say no — they tried, they experimented, they achieved. Let that be our maxim for 1985 — try, experiment and achieve.

Mr. Kiely: Information on Rory Kiely  Zoom on Rory Kiely  Perhaps I should not contribute before my colleague, Senator O'Toole, who has been waiting all day to speak.

An Cathaoirleach: Information on Patrick J. Reynolds  Zoom on Patrick J. Reynolds  I called on you because, earlier in the day, I ruled the Senator's request to raise a matter on the Adjournment out of order. I told you you could talk about it on this Bill.

Mr. Kiely: Information on Rory Kiely  Zoom on Rory Kiely  There was an arrangement that Senator O'Toole would speak before I did.

An Cathaoirleach: Information on Patrick J. Reynolds  Zoom on Patrick J. Reynolds  I did not make any arrangement, it is between the two Senators.

Mr. Kiely: Information on Rory Kiely  Zoom on Rory Kiely  We will only have three minutes each in which to speak and it is not fair to have such a short time.

An Cathaoirleach: Information on Patrick J. Reynolds  Zoom on Patrick J. Reynolds  I did not make the order; it was an order of the House.

Mr. Kiely: Information on Rory Kiely  Zoom on Rory Kiely  Orders were made previously in this House which were changed during the course of the day.

[1109]An Cathaoirleach: Information on Patrick J. Reynolds  Zoom on Patrick J. Reynolds  I did not change them.

Mr. Kiely: Information on Rory Kiely  Zoom on Rory Kiely  I am disappointed that we are limited to such a short time and I do not see why the order could not be changed now.

An Cathaoirleach: Information on Patrick J. Reynolds  Zoom on Patrick J. Reynolds  I am only carrying out the order of the House.

Mr. Kiely: Information on Rory Kiely  Zoom on Rory Kiely  There is no point in speaking for such a short time.

An Cathaoirleach: Information on Patrick J. Reynolds  Zoom on Patrick J. Reynolds  You can speak for five minutes.

Mr. Kiely: Information on Rory Kiely  Zoom on Rory Kiely  I wish to raise it through the Leader of the House.

An Cathaoirleach: Information on Patrick J. Reynolds  Zoom on Patrick J. Reynolds  He is not here, neither is the acting leader.

Mr. M. O'Toole: Information on Martin J. O'Toole  Zoom on Martin J. O'Toole  It would not be worth our while speaking at this time. I wish to protest about the system which denies us an opportunity to speak on the work which the Coalition have done over the past year. We have asked for an extension of time. I am not blaming you or the Minister present but we will leave in protest at the refusal of our request for more time.

An Cathaoirleach: Information on Patrick J. Reynolds  Zoom on Patrick J. Reynolds  It is hard enough to get into this House without leaving it.

Mr. M. O'Toole: Information on Martin J. O'Toole  Zoom on Martin J. O'Toole  We had many new speakers wishing to contribute and it is unfair to deny them that opportunity.

An Cathaoirleach: Information on Patrick J. Reynolds  Zoom on Patrick J. Reynolds  The Senator's party agreed this morning that the Minister would get in at 3.30 p.m. and also agreed to that again before we adjourned for lunch.

Mr. M. O'Toole: Information on Martin J. O'Toole  Zoom on Martin J. O'Toole  We thought we could speak when the Minister had concluded. It has happened before in this House.

An Cathaoirleach: Information on Patrick J. Reynolds  Zoom on Patrick J. Reynolds  It was made quite clear that the Minister would conclude.

[1110]Mr. M. O'Toole: Information on Martin J. O'Toole  Zoom on Martin J. O'Toole  We have often had debates in the absence of the Minister.

An Cathaoirleach: Information on Patrick J. Reynolds  Zoom on Patrick J. Reynolds  The Minister must conclude on Second Stage.

Mr. M. O'Toole: Information on Martin J. O'Toole  Zoom on Martin J. O'Toole  We wish to register a protest at not being allowed to speak on the Appropriation Bill and we are now leaving the House, as it is very unfair.

Mr. Kiely: Information on Rory Kiely  Zoom on Rory Kiely  I should like to point out that a similar Bill was passed last year and was subsequently debated after Christmas.

Mr. M. O'Toole: Information on Martin J. O'Toole  Zoom on Martin J. O'Toole  This is the second Appropriation Bill we have had this year. The first was concluded last January.

An Cathaoirleach: Information on Patrick J. Reynolds  Zoom on Patrick J. Reynolds  I am only carrying out what Senators told me to do this morning.

Mr. M. O'Toole: Information on Martin J. O'Toole  Zoom on Martin J. O'Toole  Can you guarantee that this debate will be continued at a later stage?

An Cathaoirleach: Information on Patrick J. Reynolds  Zoom on Patrick J. Reynolds  I cannot.

Mr. M. O'Toole: Information on Martin J. O'Toole  Zoom on Martin J. O'Toole  Then we will have to leave the House in protest.

An Cathaoirleach: Information on Patrick J. Reynolds  Zoom on Patrick J. Reynolds  That is unfortunate because, as I said, it is hard enough to get in here.

Mr. Kiely: Information on Rory Kiely  Zoom on Rory Kiely  We are anxious to speak but we are not allowed to do so.

Mr. M. O'Toole: Information on Martin J. O'Toole  Zoom on Martin J. O'Toole  I hope the Minister appreciates that we are not leaving because he is in the House.

Senators Kiely and M. O'Toole left the Chamber.

Mr. Daly: Information on Jack Daly  Zoom on Jack Daly  I should like about two hours to speak on this Bill but I must abide by the agreement reached this morning. I am very concerned about the strike at the Border by customs officials which has been referred to by other speakers. The withdrawal of services at the Border and [1111] deep sea ports and airports is causing widespread concern in regard to commercial life. Public attention must be drawn to the treacherous way in which customs officers are behaving. They are threatening the very fabric of the economy and interfering with normal business practices as far south as Kerry. I am in contact with the motor trade all over the country and I have received reports of widespread importation of motor parts as a result of the withdrawal of services by customs officers on the last occasion on which they went on strike. Through these contacts, I am aware of the anxiety of many other business concerns who take a very dim view of their actions, as customs officials are employed by the State to protect the interests of taxpayers and business people. The economic attractions of shopping in Northern Ireland have caused widespread economic difficulties in Border areas but the withdrawal of the service of customs officers, who are paid a salary which many people envy, is threatening people's livelihood. Their actions are deplorable and disloyal and are seen by business people as bordering on treason. Smuggling is big business, but of course those who engage in this trade risk losing the goods. However, although I am concerned about the smuggling of television sets, motor parts, etc. I am chiefly concerned about drug addicts, drug pushers and drug importers. Customs officers usually announce their intention to strike a week in advance and the drug pushers and importers know that it will be easy to bring drugs in on the day of the strike. That is a very serious matter and customs officers should realise that perhaps their own children might be the victims of the drugs which are brought in.

A very serious situation has developed in regard to bank interest rates and charges. When the Minister levied £20 million on the banks, they simply introduced new charges to get the money back from the customer.

An Cathaoirleach: Information on Patrick J. Reynolds  Zoom on Patrick J. Reynolds  The Senator's time is up.

[1112]Professor Dooge: Information on James CI Dooge  Zoom on James CI Dooge  Before the Minister replies, I understand that two Members of the Opposition walked out in protest. I want it clearly on the record that the 4 o'clock adjournment was agreed to on the proposition of the Opposition Whip. We were prepared to go on longer but we acceded to the wishes of the Opposition that business would conclude at 4 p.m. today. I think it is only right, in defence of the members of my own party, that that should be on the record.

Minister for the Public Service (Mr. Boland): Information on John Boland  Zoom on John Boland  I should like to apologise for the absence of the Minister for Finance. I am rather taken aback to have been present for the second time in less than a week in a parliamentary assembly where the Opposition chose to walk out. While I appreciate that the reasons on this occasion were different from those advanced on the last occasion, I cannot but reflect that it does not do anything at all for democracy or for the democratic system, if, in pursuit of a point, however legitimately held, the representatives of large parties in the Houses of Parliament choose to absent themselves from the conclusion of important debates, rather than making their point in another way. I appreciate that the Leas-Chathaoirleach has returned to the Chamber and I should like to leave it at that point.

Many of the contributions here during the last few days have been about policy, or the lack of policy. I could not help but reflect, when listening to the various speakers and reading what was said yesterday, on the marked difference between the plaintive cries from the Opposition and the constant references to policy and to clearly thought-out ideas as advanced by speakers on the Government side of the House. Much of the debate, of course, was about the national plan published earlier this year. That plan had a number of objectives — firstly, to contain the growth in, and then to reverse the trend of, unemployment; secondly, to continue the task to which we addressed ourselves some years ago — of restoring order to the public finances; thirdly, to instil a sense of stability and security in [1113] all sectors of the community over the three years of the plan. The plan measured against those criteria has lived up to those criteria set for ourselves when we began to prepare it.

Central to much of what the plan is about is to halt and reverse the upward spiral of unemployment. I was taken aback to hear some Opposition Senators refer to the problem of unemployment in a way which seemed to suggest that it is not central to the thinking of Government. Very much of what all of the plan is about is designed specifically to create the climate in which employment can increase. I shall refer to that later in my contribution. The nature and mix of the policies, generally, in the national plan offer the best opportunity to achieve that objective in the present circumstances.

A key element of the plan is concerned with making our economy more efficient. We have to be able to compete better with other trading countries, not only on the foreign markets where we are endeavouring to place our exports but, indeed, with those trading countries here on our own domestic market. Worthwhile and sustainable employment can only be created for our growing population by selling more Irish goods and services at home and abroad.

There is no such thing as job creation. There is the creation of a climate where jobs which are sustainable and justifiable in their own right can come into existence. Other job creation measures are funded by the taxpayer. It is as well that we realise that, and realise it clearly. We must become more competitive as regards unit cost of production, marketing, design, after-sales service, delivery dates — all the things that go to persuading the customer to buy one product rather than another. That competitiveness must permeate all facets of Irish society if we are to achieve higher standards of living for present and future generations. This is an on-going process, continually shaped and influenced by many forces in society, especially, of course, by the Government. The need to restore order to our public finances is a vital part of that process. To avoid that [1114] issue would be to condemn future generations to declining living standards as their resources would be eaten up by the servicing of debt incurred by us.

The outlook generally for the international economy on which we depend is not unfavourable for 1985, although there are some uncertainties still prevailing. Despite the fact that it is expected that the growth in world trade will fall to about 6 per cent as opposed to 9 per cent in 1984, the growth in our main markets is expected to be sufficient to support our export targets, which are themselves setting a fair requirement from our economy. The planned target is an accumulative growth of 51 per cent over 1984 to 1987. Those targets will be achievable only if there is an improvement in competitiveness as outlined in the plan. It is important for us to remember that it is expected that the average rate of inflation for the EC will fall from just under 5 per cent this year to somewhere around 4 per cent in 1985.

The policies which are set out in the plan provide the basis for further improvement and consolidation in the economy over the coming year, provided, of course, that is, that certain groups within society observe the guidelines put forward in the plan. Then, the economic objectives set out will be realised. Indeed, developments in the period since the groundwork for the plan was carried out suggest that the economy may, in fact, be performing rather better than expected in 1984. It may also be that circumstances next year will be a little more favourable than we had assumed, so that the conditions appear favourable for the realisation of the plan's projections in 1985.

On the basis of the budgetary stance which was outlined in the plan and assuming, in particular, that pay develops in the manner which we have proposed, 1985 will be a year in which further significant progress will be made in remedying the basic imbalances in the economy, in alleviating the constraints upon our performance where this is within our own scope and in creating the conditions for [1115] sustainable growth in output and employment.

The growth in domestic output projected in the plan — at about 2½ per cent — compares favourably with current expectations for the European Community as a whole, and, as I said there is the prospect that we could turn in a somewhat better performance. Of course, it would be entirely inappropriate to gauge economic progress solely by reference to short term growth achievements. If we are to get to grips with our employment problems and to deal with our growing need for jobs, it is far more important to create conditions favourable to sustained growth over the medium term. In this regard, the key factor will be the degree to which we succeed in containing increases in costs and prices here to the rates obtaining in our trading partners. The plan envisages that inflation will be further reduced next year — continuing the favourable trend established since 1983 and maintained this year. That prospect of a further fall in inflation is attainable if incomes evolve as we have indicated that they ought.

The nature of our public finance and the problems associated with it are well documented by now. As a consequence of inexorably rising public expenditure over many years, we were faced, as a Government and as a community, with a large and rapidly increasing burden of debt interest and we had to take firm action to reverse that trend. Failure to take that action would have drained scarce resources from the economy in debt service costs, leaving less for various social and economic programmes.

The corollary of higher public expenditure is higher taxation. The Government, along with many other people, have ruled out increasing the burden of taxation further. We have accepted, and said very clearly in the national plan, that we appreciate that the level of taxation — especially personal taxation — is now at a far higher level than the Government would like to see and that one of the objectives of the plan must be to ensure that tax, as a proportion, will not increase [1116] any further and that there will be, in general terms, indexing in relation to personal taxation. All that is as a preamble towards our main objective, which ultimately must be to see a real reduction in the level of taxation being levied upon the individual. That is sustainable and justifiable only when, first, our public finances are brought under control. It is not realistic to talk about reducing the level of personal tax in a year when, despite all the harsh measures which the Government had to introduce in the last number of years, as a community we will have spent by the end of this month, for the 12 months of 1984, some £1,900,000,000 more than we collected. That is the level of borrowing between current and capital over and above what the State has funded itself for through taxation. We must realise that that borrowing has, in turn, to be paid for. Until that can be brought under control the prospect of real reductions in taxation cannot be faced up to. There are only so many balls that can be juggled in the air at any one time.

We must reduce the current budget deficit by 1987 and at the same time endeavour to keep the tax burden constant. That means that public expenditure must be reduced. We have no option but to face up to reality and that is what Building on Reality is all about.

There has been a dramatic increase in current Government expenditure in recent years. In 1960 Government expenditure as a percentage of gross national product was 21 per cent. By 1980 it rose to 42 per cent and it is estimated that current Government expenditure for this year will represent 48 per cent of GNP. The increase arose under three headings: the increase in debt service charges, the increase in transfer payments and the increase in the public service pay and pensions bill. The cost of servicing public debt has increased from less than £200 million in 1975 to an estimated £1,710 million this year. The cost of transfer payments has risen from £500 million in 1975 to £2,725 million or 18½ per cent of national resources this year. The Exchequer pay and pensions bill increased from [1117] less than £500 million in 1975 to £2,740 million this year. As a percentage of GNP, it has increased from 13 per cent to over 16 per cent.

This year the Exchequer will spend almost £1,900 million more than it receives in income. Aggregate Exchequer expenditure this year will exceed revenue by over 25 per cent while current expenditure will exceed current revenue by over 18 per cent. Those imbalances are among the highest to be found anywhere in the world. They have been that way for some years. Our rate of annual borrowing is two and a half times the EC average. Debt servicing now absorbs one third of the total revenue from taxation. It would be interesting for the House to ponder on that fact. The process where an increasing percentage of tax is pre-empted for debt service charges must stop. It is not sufficient to keep the annual borrowing level at its present level in real terms. If that was all that was done, by 1990 the proportion of tax revenue being soaked up by debt service could be in excess of 40 per cent.

There is nothing intrinsically wrong with a deficit on the balance of payments provided the deficit is run for the right reasons. Unfortunately much of our debt is due to borrowing for current expenditure. The inescapable logic of the position in which the State finds itself is that the imbalance between public expenditure and resources must be reduced so that annual recourse to new borrowing by the State can in turn be reduced. That is not a matter of choice: it is a matter of necessity in the national interest. The Government have clearly pointed at the choices which must be made and the decisions which have to be taken. It is no harm for the House to speculate on our comparative position with other countries. In the case of one, Mexico, which is a major oil producer, its overall borrowing was of the same order as ours. For particular reasons, international creditors lost confidence in that country and in one single year they decided to reduce by half the level of borrowing which the Mexican economy was then demanding. If there was that loss of confidence among [1118] our international creditors it would mean that all current spending in that year would have to be reduced by one third. That means that all social welfare payments, payments for education and all public pay would have to be reduced by one third.

It is clear from that example that there is a limited choice available to responsible Governments. The choice outlined in the plan and the actions of the Government over the last two years are designed to ensure that order is restored to the public finances and that we can begin to make the choices which the public demand of democratically elected Governments.

I should like to place on record the significant progress we have made since 1971 in controlling public finances. With a fair degree of satisfaction we can point to the fact that overall borrowing has been reduced from 16½ per cent of GNP to somewhat under 13 per cent this year. The current budget deficit has been reduced to close to 7 per cent this year from 8¼ per cent of GNP in 1982. The pattern of substantial and constant annual budget overruns has been decisively arrested. Public expenditure has been brought firmly under control with savings being shown on the budget for each of the last three years. The suggestions made by Senator Ellis regarding the present state of the public finances in comparison with three years ago are not as claimed by him.

There was a suggestion made in the House yesterday that the Government's decision regarding the liquidation of Irish Shipping means that our credit standing has been undermined on international markets. On the contrary, our credit standing continues to be good abroad and, because of the decisions taken by the Government and the way in which we have faced up to the situation, we will continue to have access to foreign funds on satisfactory terms.

As for budgetary prospects in 1985, there is a need to provide for a substantial increase in central fund requirements in 1985 mainly in respect of debt servicing payments. That increase, together with other inescapable commitments, is so [1119] large that the reductions in public spending and the tax changes announced in the plan will not ensure a decline in 1985 in the relative size of the current budget deficit and the overall Exchequer borrowing requirement. Instead the Government must ensure in the 1985 budget that both the current budget deficit and the EBR are kept broadly to their 1984 proportions of GNP. Reductions will occur after 1985 in line with the targets outlined in the plan

Senators touched on a wide variety of topics. Many of them are more appropriate to individual members of the Government and I will arrange to have the points raised by Senators brought to their attention.

A number of Senators were critical of the Government's record on employment. The situation is that after four years of continuous underlying increase, the first signs of a break in the apparently relentless rise in unemployment were evident during 1984. Decreases in deseasonalised unemployment were recorded during May and October. Further evidence of the slowdown in the growth in unemployment is provided by the fact that the year on year increase at end November was 16,900 compared with 29,700 a year earlier. When account is taken of the expansion of the labour force, this improvement suggests that total employment is now beginning to stabilise, after an estimated decline of 40,000 since 1980.

We have caught the tiger by the tail and we are turning it around. The latest figures available show a halving in the rate of decrease in manufacturing employment during the first half of 1984 compared with the corresponding period of 1983. Given the continued strength of manufacturing output, there are strong hopes that this trend can be maintained and that during 1985 an employment increase will be recorded in the sector for the first time since 1979. Given the continued strength of manufacturing output, there is strong hope that this trend can be maintained and that during 1985 an employment increase will be [1120] recorded in that sector for the first time since 1979. It is interesting to realise that the IDA approvals are 30 per cent up in 1984 on the approvals for 1983.

It is also interesting to look at the figures recently produced by the Department of Labour regarding our school leavers. A survey carried out in May and June of this year showed that of the 62,000 students who left second level education one in four had gone on to third level education. Of the remaining 45,000 approximately two out of three are in employment, and of the remaining one in three of that group one-third of those were engaged in some State employment or training scheme.

Sometimes I think the situation is represented that no job opportunities at all are available to our school leavers, yet that survey published in the last fortnight shows that in May-June 28,400 of those who had left school in the previous autumn were in employment and 15,600 were in further education. Therefore, very many jobs are available to and being taken up by school leavers. We do not often enough appreciate this fact. Surely nothing is more depressing or more debilitating for young people than to have this constant harangue directed towards them that there is no job availability on the job market. The figures published by the Department of Labour belie that allegation, and it is well that Members of the House should realise and appreciate the situation.

Also in the area of employment the success of the enterprise allowance scheme introduced by the Government last January has been outstanding. So far over 4,000 people have participated in the enterprise allowance scheme and approximately 100 people per week are taking up employment under that scheme. The Government's commitment has been exemplified further, as Senator McAuliffe-Ennis said, in the introduction of the social employment scheme which will provide employment of a half time nature for up to 10,000 people, mainly those on the long term unemployment register. The Senator also referred to the introduction of a job sharing and career [1121] break scheme. Since those two schemes were introduced in the Civil Service some seven months ago they have resulted in making available 450 additional jobs within the Civil Service and that through the introduction of those two schemes alone. Therefore, very much is being done by the Government on the general employment front but, of course, employment is inexorably bound to the economic situation. Real success in employment is the real success in tackling the public finances and in the restoration of stability to the economy.

Reference was made here to cross-Border traffic and to the high rate of VAT on a number of items. This matter was brought up particularly by Senator Lanigan. I accept that VAT rates in certain cases are high and that they seem to make the purchase of some goods in Northern Ireland attractive, although I think the supposed savings on purchases which can be legally imported can very often be exaggerated. However, the Government have indicated that they are prepared to look at VAT rates and, as Senator McAuliffe-Ennis pointed out, in the last several months there was a substantial reduction in the rate of VAT on spirits for the express purpose of combatting this cross-Border trade. We indicated then, and I reiterate, that, dependent upon the success of that experiment, we would be prepared to look favourably at other areas. I am not suggesting to the House that Members should over the Christmas period endeavour to ensure that there is success in the experiment in relation to spirits. I would not expect of the House that it alone should bring about that success. Nonetheless, once a reasonable period has elapsed from which we can gauge the effect of the reduction, we will be in a position to decide whether other items might merit similar treatment. I must make the point that was made here, that we have too many VAT rates and that removal of certain items perhaps from the luxury rate may well have to be effected by a compensating increase in VAT rates in certain other areas.

Senator Lanigan criticised the fact that [1122] the Revenue Commissioners rank as a preferential creditor where companies cease trading with outstanding liabilities. That is not privileged ranking; there are other preferential creditors. I do not think that the Senator could expect seriously that the Government would apparently waive pursuit of moneys which are due by law to the Exchequer. That would be highly irresponsible.

There was some discussion in the House regarding interest rates. I would like to make it clear to Senator Lanigan that the Government as such do not approve of increases in bank interest rates. The normal protocol is and always has been that the Minister for Finance is informed of the proposed changes shortly before they are announced and of the reasons for the changes. Therefore, there is no question of Government approval being either sought or given. The Government do not, and I do not think it should be expected that they should, interfere with the day to day administration of the Central Bank which, like its colleague banks in other countries, is independent in the carrying out of its functions. It is very desirable that that should be so. I would like to point out to the House that associated bank interest rates in this country did not increase earlier this year when key international interest rates increased and recent reductions in those same key foreign rates have for the most part still left those foreign rates significantly higher than they were in the earlier part of this year.

Reference was made to the plight of the construction industry. Of course, in recessionary times the construction industry is one that traditionally suffers. However, again it is interesting to reflect that of the £1.8 billion being provided in the public capital programme next year £1.2 billion will be devoted specifically to projects in which the Irish construction industry will be taking part. That is a very high sum by any standards, a very high injection of Exchequer funds into one sector and it will be an increase on the proportion of the PCP devoted to the construction sector for this year.

I would like to thank the House for the [1123] reception it has given to the Appropriation Bill and for the very many thoughtful contributions made by Senators. As I have said, they will be taken up with my colleagues in the relevant areas.

Finally, with your indulgence, a Chathaoirleach, I would like to take the opportunity to wish to you, the House and all those associated with it the compliments of the season. It is always a pleasure to return to earlier pastures——

Professor Dooge: Information on James CI Dooge  Zoom on James CI Dooge  On a part time basis.

Mr. Boland: Information on John Boland  Zoom on John Boland  ——despite whatever small hiccups there may have been with the difficulties experienced by some Members of making their contribution. I appreciate that they were especially anxious to make their contributions in the spirit of Christmas and with my being present in the House. I would like to extend my Christmas greetings to those Members who have absented themselves also. Like you, Sir, I believe that when you are elected you participate, and I do not think it does credit to the House or to democracy generally if Members act something like Lanigan's Ball. I conclude by wishing you, Sir, a happy Christmas and the same to the Members and the staff of the House.

Question put and agreed to.

Agreed to take remaining Stages today.

Bill put through Committee, reported without recommendation, received for final consideration and ordered to be returned to the Dáil.


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