Dáil Éireann - Volume 313 - 02 May, 1979

Private Members' Business. - Control of Prices: Motion (Resumed).

The following motion was moved by Deputy B. Desmond on Tuesday 1 May 1979:

That Dáil Éireann aware of the promises of the Government contained in pages 10 and 11 of the Fianna Fáil Manifesto relating to prices to:

(i) restructure the National Prices Commission;

(ii) discourage increased costs and prices in all areas where it has control and influence;

(iii) investigate middle men's margins;

(iv) fully disseminate, at least once a week, to radio, television and newspapers comparative prices of super market consumer goods;

(v) abolish the seven day rule arising out of the outer UK zone in respect of fuel price increases;

(vi) investigate why Northern Ireland prices are less—apart from tax reasons—than prices in the Republic for the identical product from the same supplier and the same factory, for example motor cars, parts, tyres, detergents, processed foods, biscuits, clothing, and

(vii) examine the accounting procedures of the ESB with a view to reducing the price of electricity—

Notes the continued failure of the Government to take decisive action in these areas after almost two years in office;

further notes the recent sharp increases in food, housing, fuel and other commodity prices sanctioned by [2010] the Government and condemns this abject failure of the Government to implement its election promises on prices.

Debate resumed on amendment No. 1:

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

“notes with satisfaction the decline in the rate of inflation in the past two years and approves of the measures being taken by the Government to control prices”.

—(Minister of State at the Department of Industry, Commerce and Energy, Deputy Geoghegan-Quinn).

Mr. O'Toole: As far as I can recall, when moving the Adjournment last night I was discussing the efforts made by the Minister for Economic Planning and Development to justify the withdrawal of food subsidies. I recall giving figures which indicated a sharp increase in inflation in recent times. The most disturbing aspect of this is the inequitable burden it places on the less well off sections in that since New Year's Day we have subsidies partially withdrawn on basic food items. As a result the Government will receive by the end of the year over £22 million from consumers. This approximates the amount they gave out in the form of car tax abolition in 1977. There are people now paying for the abolition of car tax who would never aspire to owning a car. They are asked to pay for the benefit of other people who can well afford cars to keep their car tax paid. This is the inequitable aspect of the across-the-board application of the partial withdrawal of food subsidies.

The Minister of State said last night that we were now receiving information on a regular basis from the media on the price levels of different commodities in different areas. That is so to a degree, but it is a far cry from the promise made in the manifesto that Fianna Fáil would ensure the dissemination of information on a weekly basis in newspapers, radio and television. This is not happening [2011] because, as the Minister said last night, it is the prerogative of editors to decide what is published. That admission should have been made in 1977.

In the past I put down Parliamentary Questions to the Minister for Industry, Commerce and Energy seeking up-to-date information on price increases sanctioned by him prior to the publication of the appropriate National Prices Commission Report. For about nine months this information was forthcoming from the Minister in tabular form, but after a time he saw fit to discontinue this practice and actually refused to give this information. He told me in his reply that this information would be available to me when the NPC Report was published. This is a blatant abuse of his powers, stifling requests for information by a Member of the Opposition. I objected at the time, but so far I have got nowhere with my objection. I consider it an abuse of power, and wrong, to act on those lines and refuse information.

Dr. Woods: I wish to support the amendment in the name of the Minister, which notes with satisfaction the decline in the rate of inflation in the past two years and approves of the measures being taken by the Government to control prices. I listened to Deputy O'Toole with considerable attention. I note that he conceded to the Minister that he managed to reduce the cost of electricity on one occasion and he welcomed that reduction. Deputy O'Toole and other Opposition Members made play on the whole question of prices and price changes, and therefore it is only reasonable to consider closely some of these prices and the changes that have taken place in the past two years since Fianna Fáil came into office and compare that situation with the first two years of the Coalition period of office from March 1973 to March 1975—the first two years of each administration.

Looking at some of the most important commodities I find that bread during the Coalition period increased in price by 55.6 per cent. For the Fianna Fáil period the increase was 31 per cent. In the case of cheese, the increase in the [2012] Coalition period was 70 per cent compared with 28 per cent in the Fianna Fáil two year period. In the case of sugar the increase was 112 per cent compared with 25.5 per cent in the Fianna Fáil period. Tea, butter and milk are three other important items. In the case of tea the increase was 22 per cent in the Coalition period and 6 per cent in the equivalent Fianna Fáil period.

Mr. O'Toole: We do not grow that.

Dr. Woods: The increase in butter was 61 per cent in the Coalition period and 30 per cent in the Fianna Fáil period. Finally, the increase in milk was 60 per cent in the Coalition period and 43.8 per cent in the Fianna Fáil period. These increases on the Fianna Fáil side actually include the removal of part of the subsidies which had been added during the depression period. In the case of cheese there was a removal of 10p; in the case of butter 8p and in the case of milk 2p. Even after taking away that amount of subsidy on these major items in the first two years of Fianna Fáil Government, the rate of price increase has been only one third to one half that experienced in the first two years of the Coalition.

I make these points because they were raised in the debate last night and it is only reasonable to put the record straight in regard to Fianna Fáil's performance during their first two years in office. A great deal has been said about the removal of portion of the subsidies. Again I find an extraordinary thing on the part of the Opposition. I refer to a speech by the then Taoiseach, Deputy Cosgrave, on 27 June 1975 in Dáil Éireann. He was the Leader of the Coalition who at that time under pressure from Fianna Fáil introduced these subsidies. The then Taoiseach said:

Our aim must be to reduce the rate of inflation to a single-digit figure within a reasonably short period and thus to bring about a situation where subsidies will no longer be necessary. No one believes that subsidies are a desirable method of dealing with a situation. They are justified in very exceptional and limited circumstances.

[2013] It has been repeatedly said that they have many and substantial drawbacks. They are a wasteful way of helping those in need because they apply equally to everyone. They involve a substantial increase in public expenditure when its size and financing are already exerting their own inflationary pressures. They increase the proportion of public expenditure devoted to current consumption rather than to investment. In this way, they are, in the long term, inimical to employment. But in the conditions of today, which are unique in our country's history, the Government are convinced that subsidies are essential to begin to get the rate of price increases down.

It is only fair to say in relation to our present economic Ministers that they made no attempt to reduce the subsidies in any way until the rate of inflation was down to single digit figures. It is somewhat hypocritical for the Opposition to come along now and paint a different picture.

Mr. O'Toole: Is inflation now in single digit figures?

Dr. Woods: I will deal with inflation in a moment. I did not interrupt the Deputy when he spoke and I would be grateful if he would extend a similar courtesy to me.

The Opposition also claimed in their motion that the Fianna Fáil Government has not delivered on all their promises in the manifesto to date. They criticised the proposals in relation to the National Prices Commission and various other aspects of the Fianna Fáil policy at the time of the election. What they did not refer to was the report of the National Prices Commission issued in June 1973 which strongly recommended that the Coalition Government should reform the Sale of Goods Act. The reasons for that recommendation are spelled out in page 65 of this report, which was presented to the Government in June 1973. That Sale of Goods Act was not reformed during the Coalition period, but the Minister since assuming office has already put before the House a very comprehensive [2014] Sale of Goods and Supply of Services, Bill 1978 which has passed through the Second Stage in this House. The Minister has certainly delivered on the promise in relation to the protection of consumers. Before that Bill was introduced, the Minister introduced a Consumer Information Bill which was designed to ensure that the consumer would have protection from misleading descriptions about goods and services, in various ways. The two measures were seen as a consumer charter which would have a major influence on prices and on the performance of the market in relation to the consumer. There is no need to go into the detail of these Bills, but it is important to bring to the attention of the House the fact that these are accomplishments of the Minister, that we are not just talking about these desirable measures, but that we accepted the recommendations made in the report of the National Prices Commission in 1973 which should surely have been acted upon long before this Minister came to office in 1977.

Deputy O'Toole referred to inflation and I have a table on inflation here, so, happily, I can respond to his request. At mid-November 1973 inflation was at 12.6 per cent, in mid-November 1974 it was at 20 per cent, in mid-November 1975 it was at 16.8 per cent and in mid-November 1976 it was at 20.6 per cent. In 1977, the year in which we had a change of Government, there was a considerable improvement in the rate of inflation, which was down to 10.8 per cent, and in mid-November 1978, the period during which the budget was prepared, inflation was at 7.9 per cent. I am sure that Deputy O'Toole is aware that this was the position at that stage. It is quite clear that in relation to inflation, which is one of the major factors affecting the price of various commodities, and reflecting how the Government are performing in that area, they have brought it under control. The Government are committed to keeping inflation within reasonable limits.

Another aspect in relation to this is the purchasing power of the £. Referring to the Central Bank report during the period of Coalition Government from 1973 to 1977 if we take 1973 as 100p [2015] per £, 1974 was 85p, 1975 was 71p, 1976 was 60p and 1977 was 53p. It is vital, in any consideration of prices, to consider what can be purchased for a £, and at the rate at which the purchasing power of the £ was declining it is extraordinary that the Coalition representatives should come into this House and criticise Fianna Fáil on their performance since then, since the rate of inflation and loss in the purchasing power of the £ has been only a mere fraction of that recorded during their period in office. In this respect the Fianna Fáil record is good and we can be proud of it. Needless to say there is a great deal of work to be done here, and the Minister is very conscious of that.

As far as the National Prices Commission are concerned, the Minister of State indicated clearly last night that the promise of reviewing the National Prices Commission has been fulfilled and the review was reported on previously in the House. As a result of that investigation the National Prices Commission were strengthened. They are regarded as a watchdog committee and have produced excellent reports over a very long period. These reports have been very valuable and are vital to all concerned with the development of our economy, the changes in prices, in inflation, or in the operations of middle men, or various sectors of the economy.

Another item mentioned specifically in this motion is the investigation of middlemen's margins, and it implied that the Minister is not investigating these. Here, I must point to a report specifically requested by the Minister, the monthly report number 74 for June 1978. This is a comprehensive report on middlemen's margins. There is a report on retail margins, wholesalers and importers' margins, on margins in meat, in poultry, in fruit, vegetables and in fish. It is a comprehensive report which covers this whole area. On looking at the facts I find that the Minister has delivered here too, he has instituted a study of middlemen's margins and this study was made available publicly in June 1978.

The details of this would be worthy of further separate study. The commission's conclusions showed that the study on [2016] fruit and vegetables bore a close similarity to that on poultry margins published in January 1978. In both cases the consultants found that margins were not excessive in the earlier stages of distribution in smaller retail outlets. The supermarkets were the only exception. In the report of April 1978 it was indicated that the results of the price margins on fruit and vegetables for transmission to RTE suggested that the prices in major supermarkets at least in Dublin were more often than not higher than in other outlets. This pattern has continued since then. The Minister pointed out that An Foras Talúntais are engaged in a further study in this area in much greater detail. The Minister has been very active in this area. He has instituted a study, has given a report and has ensured that further studies will be carried out.

The question of oil has been mentioned repeatedly in this debate. The Minister has come to a positive and definite conclusion on this matter. He has said that as a matter of strategic policy he believes that a State oil company should be formed. He has committed himself clearly on this and has said that he is setting about to prepare legislation on the matter. Here, again, the Minister has been quite decisive and the people recognise this. All of us must admit that this is a most complex and difficult situation. I cannot agree with the suggestions in the motion put down by the Opposition in relation to the Minister's performance.

When we look broadly at the Government's approach we must bear in mind that there is a great deal more to price control and the influencing of price than publicity, argument, debate and even watchdog committees. The Minister and the Government have strengthened the National Prices Commission. They have given more publicity to price reporting. Last night the Minister of State gave us a detailed account of the work in progress in that area. Information about prices has increased and here the Minister and the Government have delivered on their promises.

However, this information does not solve the problems. On the question of prices and the stability of prices, far [2017] more important is the economic and structural measures taken to stabilise prices. The economic and structural measures cover a wide range. They include the control of inflation, the control of the power of the £ and the influencing of the power of the £. One of the major measures taken by the Government in relation to control of inflation was our membership of the EMS under which we are permitted a very limited variation in the exchange rate of the £, a limit of 2¼ per cent up or down. While this measure at first may not seem to have a direct bearing on the price of commodities, because it affects the purchasing power of the £ and inflation it has a direct bearing on prices. So long as we maintain stability in our currency, automatically we will maintain a high degree of stability in price inflation. This is one of the fundamental measures taken by the Government which is far more important than the cosmetic operations or the more minor steps that can be taken to influence prices.

Of course the Government have also taken steps in relation to social welfare recipients by giving direct increases greater than those necessary to meet the rate of inflation anticipated in the current year. Social Welfare recipients have been protected in this way at least in the short term and I am confident that if it is necessary to give them further direct protection the Government will do so.

The stabilisation of agricultural prices is an important aspect of price control and here it is clear that we will not see very high rates of increase in agricultural prices in the coming period. We can expect much greater stability in this area.

Another major structural measure the Government are taking is to encourage reorganisation of the markets. This is quite clear from statements made by Ministers and in the actions that have been taken. This measure has a fundamental effect on future price relationships. It is not the easiest one to get across to the media and to the people but it has long-term benefits for the consumer. We have talked about the middlemen's margins. We can study them and find out what is happening but if we want to influence them directly we must increase the strength, cohesion and information [2018] among the producer groups. In recent times the Government have encouraged the establishment of a number of producer groups. These will affect the structure of pricing and will ensure that where middlemen's margins are involved these people will give an efficient service or else they will not survive. They have an important part to play but too often they are inefficient and the costs incurred are greater than they need to be. By strengthening the producer groups, by increasing the information about prices on a continuous basis, and particularly by strengthening the groups who use the services of the middlemen it is possible to reduce wastage.

The approach of the Government to the co-operative movement has been one of encouragement. They have encouraged the strengthening and development of the co-ops for the same reasons. Here, again, there are the basic producers, the handlers of food materials, and if they are efficiently operated benefits will accrue to the consumers not only by way of improved and efficient pricing but also by way of higher quality, better presentation and packaging.

The Government have been putting a considerable effort into the co-operative movement in this way. Deputies will recall that economic Ministers have been urging the trade unions to look at the possibilities attached to co-operatives in Europe with a view to becoming involved in the movement here, both themselves and their members. Structural changes will take place in this area to the great benefit of consumers, here much more than in Europe.

In looking at the Government's performance we must consider the entire package. It is useless to look at one aspect without looking at the whole complex. We must look at Government measures in regard to job creation, prices, inflation and the targets which have been set in regard to increasing our standards vis-á-vis our European partners. The recent national understanding, by guaranteeing incomes against CPI increases, is a great step forward. An inflation rate of 7 per cent is assumed and for each percentage point above 7 per cent which the inflation [2019] rate actually reaches, a 1 per cent wage increase would be incorporated up to 11 per cent, and thereafter a 0.5 per cent increase in wages would apply to each 1 per cent inflation.

Therefore, the Government are bringing in, in a comprehensive way, fair and reasonable control, an assurance and a guarantee to the worker and the consumer generally that they will not again have to face higher levels of price increases such as they have had to suffer in the past few years. The Government now have these matters well under control. In the terms of the national understanding, consumers can rest assured that there will be considerable stability.

Mr. J. Ryan: Having listened to Government speakers last night and to Deputy Woods this evening saying that the Government had prices under control and that this had enabled them to finalise a pay agreement, I wondered whether I was living in the same country. Perhaps Dublin is different from Tipperary in this respect. The CPI in the past two years has not risen at a slow pace but at a gallop.

The Taoiseach at Question Time on 21 March was asked by Deputy Horgan about the percentage increase in the CPI between mid-May 1977 and Mid-May 1979. I will select from the reply the percentage price increases in three basic food items from the point of view of the ordinary worker, the old age pensioner and the social welfare recipient. In that period the price of bread increased by 29.9 per cent, butter by 29.1 per cent and milk by 43.7 per cent.

Before June 1977, no matter which part of my constituency I travelled, in supermarkets and shops or outside them, I met Fianna Fáil canvassers with their fabulous food basket lists. The people were conned by those lists. Any housewife or shopkeeper will confirm that these days there is not a budget once a year but once a week. Indeed I am afraid to ask my wife about the cost of living because her budget becomes demolished day by day. People are frightened at the rapid rise in the cost of living, and the most important contributory [2020] factor has been the partial abolition of the food subsidies.

We may be accused of frequent repetition of this but, as a Deputy who knows so well the needs and the demands of the ordinary people, I cannot repeat too often the staggering effect the abolition of the food subsidies has had on the living standards of lower paid workers and social welfare beneficiaries.

Deputy Woods spoke about how these people were looked after in the budget. Bread, butter and milk are the stable diet of the ordinary people, and who will stand up here and say that an increase of 29 per cent in the price of bread and 43 per cent in the price of milk are not substantial increases?

Last week we heard of the national understanding, of the three sides getting together. The low paid worker is not coming too well out of it. Crocodile tears have been shed for years and promises have been made to those workers. How can anybody suggest that a wage increase of £4 per week will be sufficient to look after their needs in the next nine months?

We are living in a state of great industrial unrest and questions are being asked in editorials in national and provincial newspapers about what has gone wrong. One should think about the situation on Friday evening when the man on a low income takes home the wage packet and the unfortunate wife has to try to fend until the following Friday on £50. This is one of the basic reasons why there is not industrial peace here. One must relate to the situation as it is. It is a matter of existence for many families. The Government's partial abolition of the food subsidies has contributed to this industrial unrest and we must lay the blame in the proper place.

I would like to take it a stage further and talk about housing and housing land and the building of houses. The Minister for the Environment, in a housing directive last August, highlighted the idea that every man should be able to own his own house and I applaud that idea. That is what is needed; it must be the fundamental right of every man and woman and their family to own their own house. In the same circular, while the exact figures were not outlined, guidelines [2021] were issued that any man on around £4,000 per year approximately, irrespective of the number of children in his family, should be able to build his own house. With all due respect to the Minister, he is living in cloud cuckoo land if he thinks a man on a gross wage of £4,000 a year can build his own house at the present cost of building land and of building houses. Housing has gone up by about 40 per cent in the last two years. Building land has also gone up. What we are talking about is a man on a gross income of £4,000 a year which in 1979 is not a high income. He is being told—and I know it from experience at county council level—that he should be in a position to buy his own site and build a house to his own specification and we are talking about a man who is also debarred from a council loan to build a house. Here we have a most peculiar housing anomaly where a person with £4,000 per year is told that he cannot have a local authority loan but must go and build his own house. So out of a gross of £80 a week the Minister says a man should be able to buy a site which can approximate £4,000 and build a house now costing in the region of £17,000 or £18,000. That is a total of £20,000. Surely there is something wrong somewhere when we start talking about building one's own house on £80 a week. How can any Government expect a man on that low income to be able to provide the money and meet a repayment of approximately £30 a week on a house if he were to build his own.

I would take it a stage further and go from building land to agricultural land. In The Irish Times of 27 April it is stated that land values have increased at a phenomenal rate and although there was a slight easing of prices for farms in the past six months they are still away above the economic value of the land for production purposes. Here again we have the situation where another small man, the small farmer, is not in a position to buy land.

An Leas-Cheann Comhairle: Housing forms part of the motion. Housing land and housing land prices would be relevant but agricultural land and small farmers are not.

[2022] Mr. J. Ryan: We should also be concerned about the lot of the small farmers. I am sorry if I have gone onto the wrong grass but I am not as green as I look.

An Leas-Cheann Comhairle: The grass for housing is in order on this motion.

Mr. J. Ryan: There is one other aspect of this motion that I am concerned about. I refer specifically to the question of roadside trading. We have been promised legislation to control the invasion of every road in our country by this type of trader and nothing has been forthcoming. I can assure the house that this is a matter that is getting completely out of control. I cannot speak for the nation but I can speak for my own constituency. Every town in my county is under siege from this type of trader. They are interfering with trading in the area and, while it is not in the motion, I will have it said before the Chair can stop me, they are also destroying the country. I appeal to the Minister of State, Mrs. Geoghegan-Quinn, to treat this as a matter of grave urgency as people are living in peril because of these people. I know areas where groups of vigilantes are being formed to protect the sheep and young lambs from straying dogs. These traders are paying nothing and contributing nothing to the economy but they are going around in Mercedes and in fabulous mobile homes.

On the question of food subsidies I would like to take our minds back to the wage agreement of 1976. One of the inbuilt conditions of the agreement was the continuance of food subsidies. We are now in the process of finalising a wage agreement which we all wish for for the good of our people and our country but surely cognisance must be taken of the fact that four months prior to the discussions going on at present this Government partially abolished food subsidies.

There is also another important matter and that is the question of the abolition of the road tax and the almost instantaneous massive increase in motor insurance. This surely must bear some investigation. It has a vast impact on the workers with so many needing cars to [2023] travel to work. What was gained in the abolition of road tax was submerged in a massive increase in motor insurance.

If the wage agreement is to be concluded there must be a re-institution of the food subsidies that were abolished last January or a promise at least that no further interference will be made with the way of life of the ordinary worker and the old age pensioner.

An Leas-Cheann Comhairle: Deputy Desmond to conclude.

Mr. B. Desmond: In the 15 minutes available to conclude I want to refer to a number of points made during the course of the debate. Last evening I was critical of the proposed minimal restructuring of the National Prices Commission because, apart from the appointment of Mr. Patrick Lyons, nothing else has been done. The other changes referred to by the Minister were not of a fundamental nature. I am afraid I must take issue with the Minister when she said that in my comments I implied he was a Fianna Fáil Party hack. No such implication was made by me in my comments if the record is read properly. I know that person for many years and both of us would agree that the comments made by the Minister in that regard were rather silly.

The second comment the Minister made was in relation to my colleague in the west. It was a rather irrelevant comment but I have to take issue with it. It is perhaps better to get the contentious matters out of the way first and then I can get down to replying to the other aspects raised. The Minister took umbrage to the idea that certain vehicles belonging to the Post Office were carrying election posters for the chairman of the Labour Party who happens to be a Euro-candidate. That is a bit ridiculous and rather silly.


Mr. B. Desmond: If somebody in the engineering side of the Post Office in the exuberance of his support of the chairman of the Labour Party put up a poster on an official van I do not consider [2024] it has to be brought into this House, because all it does is to increase support for the chairman of the Labour Party. It is quite ridiculous, with due respect to the Minister, to imply, as she did, that it was in the interest of some parties in the Opposition to help to prolong the Post Office dispute. That is stretching one's ministerial imagination a little bit far. Nobody in the House wants to see the Post Office dispute carried on for one second longer than it is being prolonged. I and my colleague, Deputy Corish, who is spokesman for our party on P & T, would be only too happy to see an end to this dispute. So far as the Opposition can take any action in a matter like this, we have done our best to try and bring about a settlement. I regard that comment as not being of ministerial standard.

There are genuine criticisms contained in the Labour Party motion. The Government are now two years in office and on the assumption, even if the Minister for Agriculture resigns, that the Government are not likely to fall, they have another two and a half years to go. It is only right that half way through their term of office we should pinpoint the manifesto promises in regard to prices. In regard to the statement made by the Minister last night there has not been any great restructuring in the National Prices Commission. I am not so certain that it requires massive restructuring, but for a party to go around the country telling the people to put them back into office and they would really get the NPC on their hind legs chasing after price increases and then to do nothing about it is to “con” the public at large. Secondly, nothing has been done in regard to investigating the middlemen's margin. There have only been some cursory examinations. The Minister did not deny that there was a promise made during the election campaign to publish on television and newspapers comparative prices of supermarket goods. That has not happened. The Government have not kept their promise in this regard.

With regard to the seven-day ruling arising out of the UK Outer Zone agreement, there was naïvety here in regard to the defence offered by the Fianna Fáil [2025] Party. The Minister of State said last night:

When the Minister assumed responsibility for price control in 1977, he decided to retain the link with the UK Outer Zone for the time being simply because it suited us to retain it.

The boot is now on the other foot. At the moment it suits the oil companies to retain it because they are seeking substantial price increases in accordance with changes in the price structures in the UK Outer Zone. That has not been given to the oil companies. We cannot say here that we want something because it suits us and, when it does not suit us, turn around and tell the oil companies that we are afraid it cannot suit them. I find a contradiction of policy here. The oil company executives throughout the country have a very cynical view about the way in which the Government handle their relations with them.

I am probably the last person in the House who would be regarded as a fan of the multi-national oil companies, but I believe that in commercial relations between a Government and any multinational there should be straight dealing. I am afraid that has not happened. We still have winter in the first week in May. We are hardly likely to blame the Government for that, but domestic heating oil cannot be got. Many of my constituents are furious that, because of mishandling by the Government in relation to the price increase in recent weeks, granted to the oil companies many of them have not any domestic heating oil in the present inclement weather.

There are some other items I want to refer to. There should be a far more through examination in relation to a number of areas, in particular bank charges. The Central Bank monitor bank charges and I know that they are outside the ambit of the NPC at the moment. I am very dissatisfied with the charges made, the hours of opening and the general services provided by our commercial banking institutions. I believe that, with the tremendous profits they have made in recent years and with the colossal profits they are now making out of the EMS, it is high time that a fullscale [2026] investigation of banking charges was brought within the ambit of the NPC.

I met a constituent of mine the other day who was going to visit her daughter in Wales. She went down to Dún Laoghaire to get £150 sterling. She had to pay £156.50 between commission and the difference between the Irish punt and the UK pound. We have had very strong complaints about the actions of commercial banks in the UK at Heathrow Airport and elsewhere, where there were charges of anything up to 8p or 9p on the Irish pound. The commercial banks are making a substantial killing in relation to ordinary money changing. Their operations should be brought more firmly under the ambit of the State. The Central Bank should not have exclusive review in relation to bank charges or to be notified by commercial banks of their charges and get away with it scot-free.

The NPC should be more closely involved with house construction costs. Bearing in mind the colossal increases in house prices in recent years, particularly in the past two years, I am not satisfied that a more rigorous control and intervention on the part of the State could not be brought about. It is outrageous that in an industry which charges people anything up to £25,000 or £30,000 for a new house, some people are making a great deal of money. The State should not tolerate such a situation.

This is a very difficult and complex situation to come to grips with because the cost of building materials is very high and 50 per cent of the cost of building a house is spent on labour and there is the perennial problem of land prices. Here again the Government have been negligent. They have been two years in office; they have a massive majority of 20 and can take on any group in the State with equanimity, and there is no way they can be voted out of office. Still the cost of a site to build a house has been allowed to escalate out of all proportion. Speculators and get-rich-quick merchants dealing in building land have made massive killings in recent years.

I do not see any reason why the implications of the Kenny report and the [2027] necessary legislation should not have been brought in long ago. This is an outrageous situation. It means that in my constituency, South Dublin, the cost of new houses is above the national average. The ordinary industrial worker, married, aged 23, 24 or 25 years, earning an average of £75 to £85 a week in a factory has not a hope in hell of buying a new house. He has to depend on the local authority. That is not a healthy situation. It is undesirable socially that newly married young people with one or two children should be so cynical about their prospects of having a home of their own. In the greater Dublin area the average earnings of a man in an industrial factory is £90, including overtime and shift allowances. After tax in many cases his take-home pay is around £70. He finds it impossible to pay £20, £30 or even £35 or £40 a week for a house mortgage. As a result the local authorities are obliged to have a large number of such persons on their housing lists. This is very costly in terms of State subsidy and social structures. The Government could do a lot more in this area.

Many people, from the Minister for the Environment down the line, attempted to come to grips with this problem but they have not brought about a situation where house prices would rise at a level of, say, 12 or 15 per cent per annum. That would be a normal increase rather than, as is happening at present, an increase of the order of 35 per cent. If I were in Government I would have a radical rethink about the £1,000 house grant which is payable direct to the builder. Most builders have put this money into their pockets and increased the price of houses by £1,000. In a buyer's market one finds builders being cynical and saying that the £1,000 is given to them. Of course, it is contingent on a certificate of reasonable valuation being supplied but apparently the £1,000 first house grant has been, if anything, inflationary and certainly has been of no great benefit to the ordinary wage and salary earner or the person in the middle income group who is trying to buy his own house.

The Government could bring greater [2028] pressure to bear on motor insurance. I feel very strongly about this. We are reaching a situation similar to the demands which were made in relation to health eligibility in this country. I never thought I would see the day when a government could cave in so rapidly, as they quite rightly did in relation to the current proposals for the national understanding, and bring on a straight limit of £7,000 in relation to health eligibility. Minister after Minister came into this House and Minister after Minister went to Fianna Fáil cumann meetings and said that that could not possibly be done. They said that £5,500 was the limit but when democratic pressure was exerted by a particular group in society in the context of national pay negotiations, Deputy Haughey, Minister for Health, was sitting in amazement in his office while the Cabinet in Merrion Street said that the new health eligibility limit would be £7,000.

Likewise I believe pressure will develop in this society because our motorists are sick to death having to deal with commercial motor insurance organisations and they will demand a kind of VHI motor insurance structure, a kind of occupational injuries motor insurance structure, a national system of motor insurance. In Austria if a person does not display his motor insurance certificate the police simply remove the number plates from the car. To drive a car there without number plates would mean that one would get six years in jail. Some people here drive around without any motor insurance. They take colossal risks, maiming people, and are involved in a massive number of car accidents every year. There is a fairly rigorous enforcement of the insurance provisions by the gardaí but there are people of utter and total social irresponsibility who still drive around in cars which are not insured. With the gardaí having so much on their hands nowadays to protect money, not to mention life and limb from uninsured cars on the road, there is a situation where some people still manage to get away with uninsured cars.

The Government should seriously contemplate bringing in a State sponsored body for motor insurance. With the postal dispute now in its tenth week [2029] people will say that they posted their cheque to the insurance company to insure their car and the gardaí will have a job finding out where the truth lies in checking on individual cases. Motor insurance should not be in the hands of private organisations, whether they be so called corporate or so-called provident societies. There should be a similar system to that which operates with VHI, the national health service, social insurance and occupational injuries. Motor insurance should come within that ambit. I make that point strongly to the Minister and also that such an organisation should be run on a nonprofit making but break even basis. In Canada and other countries such State organisations are run at no cost whatever to the Exchequer. If someone drives a car on the road he should pay the full economic cost of insurance. There is no question of a State subvention being involved in that regard.

I should like to make some comment on the role of the NPC in relation to hotel charges, lounge charges and so on. We have a major tourist industry. There are many times when I seriously question whether we deserve to have as large, as profitable and as buoyant an industry as we have had in the past two or three years. Many of our so-called lounges are, for tourists and for the natives, unsanitary, unhygienic——

Mr. Corish: And profitable.

An Leas-Cheann Comhairle: We are stretching the motion.

Mr. B. Desmond: The Chair would not know anything about the price of drink.

An Leas-Cheann Comhairle: I know all about it.

Mr. B. Desmond: To charge a tourist coming from the UK or from America £1 or £1.50 for the privilege of going in and having his eardrums destroyed from listening to a cabaret artist who might be 90 yards away on a miniscule stage——

Mr. Briscoe: Probably from his own country.

[2030] Mr. B. Desmond: ——and simultaneously to be charged 60p to have a watery pint——

Mr. Corish: Flat.

Mr. B. Desmond: ——flat, handed to one and then call this a tourist attraction, the NPC should publish little warning notices on the back of their reports advising tourists that they are being taken for a very unbeneficial ride.

I have spoken to many tourists and not only do they have to pay 60p a pint, having paid a heavy cover charge, but when they visit the so-called toilets provided by such establishments, which are a disgrace to any country——

An Leas-Cheann Comhairle: We are really stretching the motion now.

Mr. Corish: One has to pay for it all.

Mr. B. Desmond: I am talking about value for money in terms of prices.

An Leas-Cheann Comhairle: By speaking on the question of toilets we are getting away from the motion.

Minister of State at the Department of Industry, Commerce and Energy (Mrs. Geoghegan-Quinn): The Deputy is showing his age.

Mr. B. Desmond: It is a pet hobby horse of mine because the constituency I represent has a very high tourist visitation. I get very irate when I see some tourists making for the boat and paying £3 or £3.50 for a breakfast one would be ashamed to hand to the dog at home. They then get on a boat with that memory of Ireland.

Price and quality control and supervision should be much more rigid and if it is a hobby horse of mine, it is one I am glad to ride around the floor of the House tonight.

I am genuinely disappointed with the performance of the Government in relation to the prices situation. Whether it is houses, motor insurance, food subsidies or ordinary heating oil at home there has been a lack lustre performance by the Government. Nobody is more acutely [2031] aware than I am of the extreme limitations facing any Government in relation to the control of prices. The best any Government can do is to exert an influence over the situation. The element of control is extremely limited but, in so far as there devolves on the Government the obligation to exert that control, I get the impression that the Minister, Deputy O'Malley, apart from flogging it to death in the run up to the last election, forgot about the NPC as soon as he was in office and put it under the gentle wing of the Minister of State. I am afraid it will languish there for the next two and a half years. I hope the Minister will not also languish in the process.

In the Fianna Fáil election address [2032] flogged around Dun Laoghaire there was a slogan which said Fianna Fáil will end this chaos. A fair amount of chaos has been created by the Government and is with us now. I know the Government might be in the extremity of decision about the Minister for Agriculture in relation to an entirely different matter but that should not cripple them altogether in terms of taking action in the area of prices where they have a major role to fulfil and where they have done nothing much in the last two or three months.

I tabled this motion with my colleagues. We support the motion. We do not accept the amendment and propose to call a vote.

Amendment put.

The Dáil divided: Tá, 67; Níl, 45.

Ahern, Bertie.

Ahern, Kit.

Allen, Lorcan.

Andrews, David.

Andrews, Niall.

Aylward, Liam.

Brady, Gerard.

Briscoe, Ben.

Browne, Seán.

Burke, Raphael P.

Callanan, John.

Cogan, Barry.

Colley, George.

Collins, Gerard.

Conaghan, Hugh.

Connolly, Gerard.

Cowen, Bernard.

Cronin, Jerry.

Daly, Brendan.

Davern, Noel.

de Valera, Síle.

de Valera, Vivion.

Doherty, Seán.

Fahey, Jackie.

Farrell, Joe.

Filgate, Eddie.

Fitzpatrick, Tom. (Dublin South Central).

Fitzsimons, James N.

Flynn, Pádraig.

Fox, Christopher J.

French, Seán.

Gallagher, Dennis.

Gallagher, James.

Geoghegan-Quinn, Máire.

Gibbons, Jim.

Hussey, Thomas.

Keegan, Seán.

Kenneally, William.

Killeen, Tim.

Killilea, Mark.

Lawlor, Liam.

Lemass, Eileen.

Lenihan, Brian.

Leonard, Jimmy.

Leonard, Tom.

Leyden, Terry.

Lynch, Jack.

McCreery, Charlie.

McEllistrim, Thomas.

MacSharry, Ray.

Meaney, Tom.

Molloy, Robert.

Moore, Seán.

Morley, P. J.

Murphy, Ciarán P.

Noonan, Michael.

O'Connor, Timothy C.

O'Donoghue, Martin.

O'Hanlon, Rory.

O'Leary, John.

O'Malley, Desmond.

Reynolds, Albert.

Smith, Michael.

Walsh, Joe.

Walsh, Seán.

Woods, Michael J.

Wyse, Pearse.


Barry, Peter.

Barry, Richard.

Belton, Luke.

Bermingham, Joseph.

[2033]Conlan, John F.

Corish, Brendan.

Cosgrave, Liam.

Cosgrave, Michael J.

Creed, Donal.

Crotty, Kieran.

D'Arcy, Michael J.

Deasy, Martin A.

Desmond, Barry.

Desmond, Eileen.

Donnellan, John F.

Enright, Thomas W.

FitzGerald, Garret.

Fitzpatrick, Tom. (Cavan-Monaghan).

Flanagan, Oliver J.

Gilhawley, Eugene.

Griffin, Brendan.

Harte, Patrick D.

Boland, John.

Bruton, John.

Burke, Joan.

Collins, Edward.

[2034]Hegarty, Paddy.

Kavanagh, Liam.

Keating, Michael.

Kelly, John.

Kenny, Enda.

Kerrigan, Pat.

Mannion, John M.

Murphy, Michael P.

O'Brien, William.

O'Connell, John.

O'Donnell, Tom.

O'Toole, Paddy.

Pattison, Séamus.

Ryan, John J.

Spring, Dan.

Taylor, Frank.

Timmins, Godfrey.

Tully, James.

White, James.

Tellers: Tá, Deputies MacSharry and Briscoe; Níl, Deputies B. Desmond and Creed.

Amendment declared carried.

Motion, as amended, put and agreed to.