Dáil Éireann - Volume 326 - 28 January, 1981

Financial Resolution No. 2. - Excise—Beer.

An Ceann Comhairle: I understand it is proposed to discuss Financial Resolutions Nos. 2, 3 and 4 together.

The Taoiseach: I move:

(1) THAT in this Resolution—

“the Order of 1975” means the Imposition of Duties (No. 221) (Excise Duties) Order, 1975 (S.I. No. 307 of 1975);

“the Act of 1980” means the Finance Act, 1980 (No. 14 of 1980).

(2) THAT the duty of excise on beer imposed by paragraph 7 (1) of the Order of 1975 shall be charged, levied and paid, as on and from the 29th day of January, 1981, at the rate of £112.266 for, in the case of all beer brewed within the State, every 36 gallons of worts of a specific gravity of 1,055 degrees, and, in the case of all imported beer, every 36 gallons of beer of which the worts were before fermentation of a specific gravity of 1,055 degrees, in lieu of the rate mentioned in section 64 (1) of the Act of 1980.

(3) THAT, subject to paragraph 5 of the Imposition of Duties (No. 250) (Beer) Order, 1981 (S.I. No. 10 of 1981), the drawback on beer provided for in paragraph 7 (3) of the Order of 1975 shall, as respects beer on which it is shown, to the satisfaction of the Revenue Commissioners, that duty at the rate mentioned in paragraph (2) of this Resolution has been paid, be calculated, according to the original specific gravity of the beer, at the rate of £112.266 on every 36 gallons of beer of which the original specific gravity was 1,055 degrees.

(4) IT is hereby declared that it is expedient in the public interest that this Resolution shall have statutory effect under the provisions of the Provisional Collection of Taxes Act, 1927 (No. 7 of 1727).

Mr. P. Barry: We are opposing the Financial Resolutions dealing with excise on beer, spirits and on wine and made wines. It is difficult to understand how the Government could have introduced this duty, particularly on spirits, at this time. Obviously they did not believe what the chairman of the Irish Distillers Group said when he pointed out the danger of unemployment in the industry and the fact that they were postponing investment because of the damage done to the trade by the measures introduced in last year's budget. The Minister was frank in saying the reason he introduced the duty was because he wanted the money but when one considers the amount of juggling carried out by the Government on the figures in the Book of Estimates and in the budget today one cannot understand why they did not engage in some further juggling without imposing this tax on spirits.

Three months ago a booklet was issued stating that the number of people treated for alcoholism had increased in a ten-year period and in a comment on this the Minister for Health said it showed the justification for increasing the duty on spirits in last year's budget. I object first to the Minister trying to make political capital out of this sad disease. He should [481] know the reason more people are being treated for alcoholism: this is something that should be encouraged because the more people realise it is a disease that should be treated and one that can be suspended the better. It is recognised by the social people who are concerned with alcoholism that increasing the price of drink does not cure the disease. What happens is the families of alcoholics have to do without while the alcoholic spends more money on drink. I do not want this duty on spirits to be represented by the Minister for Health, the Taoiseach or the Minister for Finance as something of social benefit and something that will help to cure alcoholics. All it will mean is that the families concerned will be more deprived. The only way to treat alcoholism is by education not, as was suggested by the Minister for Health, by imposing extra duty on drink.

Every member of the Government is responsible for the budget. They are endangering the jobs of people already at work and they are preventing the creation of further jobs in the distilleries, even though they say their primary objective during the year will be to create employment. When Deputy O'Leary was speaking a short time ago the Minister for Energy took exception to a remark he made; he gave a figure of 30,000 jobs created in the past three years. Evidently the Minister is not reading the publications issued by the Minister for Finance and the Government. In the “Economic Background to the Budget, in 1981” there is the following statement:

It is estimated that on average during 1980 there was little or no change in the 1979 level of employment, an increase in services employment being offset by a decline in agriculture and industrial employment.

This was referred to by the chairman of the Irish Distillers Group when he said they had plans to increase employment but for the 1980 budget. Last autumn he said that unless trade improved during the remainder of that year there was a danger of people being laid off or put on short-time. He appealed publicly in the press — presumably he appealed privately [482] to the Government—and said that a further imposition of duties in this budget would further postpone investment and the creation of new jobs and would make more likely the prospect of laying-off people.

The Minister cannot say that he did this in ignorance of the consequences of increasing the amount of tax. It is an ill-conceived move which is bound to have a detrimental affect on employment in distilleries. It will also make it that much more difficult to reach the hoped for employment levels. This is only a small sector of Irish industry but it is, and always has been, a very profitable one which gives good, worthwhile employment and has enormous export potential. These factors are in danger because of the high level of duty imposed by this year's budget and the same goes for the pint of beer.

We have in this country three breweries, two of which, very small ones, happen to be in my constituency. I know from the owners that the increase in the price of beer will also have a detrimental effect on employment in those breweries. Last year there was a slump in trade, with a danger at one time that people would be laid off, but because they expected, as normally happens after a budget, that after some time the demand would pick up again, they held on to their employees. They will not do that this year. They are not expecting an increase in the price of beer this year and a similar decline in sales as occurred last year would definitely result in people losing employment, at least temporarily. I do not know how up-to-date the figures from the CSO are or, in this case, from the Department of Industry, Commerce and Tourism. These figures will certainly tell the Minister that this month, January, has been the worst month for sales in the liquor trade since the war. Every indication that the publicans' associations have, either from tapping their own sources or from any semi-official information available to them, is that in the month of January 1981, sales are lower, in volume terms, than at any other time for almost 40 years.

[483] The Taoiseach may shrug his shoulders and say that this is not important but there is a considerable number of people working in publichouses and considerable part-time employment given to people to assist in balancing their household budgets. The two steps taken in this year's budget will further increase unemployment and make it more difficult for us to pull out of this recession.

Mr. M.P. Murphy: On Resolutions Nos. 2, 3 and 4 the Taoiseach and his Government anticipate extracting an additional £49 million from the general body of taxpayers who take a drink. This is unfair and unjust. What has been said on Resolution No. 1 relative to tobacco and cigarettes could usefully be said on Resolutions Nos. 3, 4 and 5. In order to refresh our memories, I ask the Taoiseach what will now be the taxation, both excise and value-added tax, on a pint of beer, a glass of spirits and on the wines covered by Financial Resolution No. 4? The statement does not give that information. Would the Taoiseach be kind enough to let us have the actual amount, because the people who have to pay the piper would like to know what it really means and I am sure that our publicans would also like to know.

The Taoiseach: After the budget, 70p. Take a 70p retail price, 34.1p is the total tax content.

Mr. T.J. Fitzpatrick (Cavan-Monaghan): And on a glass of whiskey?

The Taoiseach: On a glass of whiskey, after the budget 71.4p total tax content. This includes excise duty and VAT.

Mr. T.J. Fitzpatrick (Cavan-Monaghan): On a glass?

The Taoiseach: On a glass.

An Leas-Cheann Comhairle: Deputy Murphy, please.

Mr. M.P. Murphy: The Taoiseach has [484] informed us that beer will have a total taxation of 34.1p on a pint, including VAT. By any standards this is a formidable figure.

I do not accept Deputy Barry's comments on alcoholism. The number of alcoholics in this country is relatively small and 98 per cent of people who take a drink could not by any stretch of the imagination be termed alcoholics. To some extent, publichouses are the life's blood of our rural countryside, possibly to a greater extent than in the city of Dublin or any other largely populated centre. It is traditional in Ireland for the pubs to be the gathering place on a few nights a week for the people in the surrounding district. The people congregate in their local pubs and I see nothing wrong with that. It is a reasonably good idea to relax, discuss the business of the week or of the day, exchange views and talk about one's problems. This is a fine tradition which particularly helps the atmosphere in rural Ireland. Also, old people like to have their half-one or their few pints a week. The Government, by the continuous imposition of taxes on beer, spirits, wines and cigarettes, will phase out that tradition.

Deputy Barry adverted to another aspect, which was the employment content. We all know that there are many people employed in the licensed trade. I do not know how many publicans there are in Ireland but I am quite sure that the number is a sizeable one, and then there is the employment given by publicans, by breweries and by distillers.

Guinness is a name known throughout the world. The poor man was there in the 18th century.

Mr. Enright: What about Murphy?

Mr. M.P. Murphy: The name of Murphy has been closely associated with the brewing industry and it deserves special mention, as do other names. The cumulative effect of these three taxes on the brewers and distillers, the public houses and the transport industry will be to cut down on employment.

We have read a statement by the Irish Distillers Group — the Taoiseach's predecessor [485] is a member of the board of that august body and I am sure he was a party to the statement — intimating that it has become necessary for that industry to reduce their work force by something in the region of 500. The reason given for this sizeable reduction is a drop in sales: they claim their spirit sales declined by almost 20 per cent in the 12 months they were dealing with.

The Taoiseach expects to gather an additional £14 million under Resolution No. 2. The Government believe that consumption of drink will not fall as a result. The fact is that the Taoiseach has made it impossible for us to drink. He may think, or hope, that this increase in taxation will be forgotten and that people will drink as much as ever after a time. He could be wrong because last year's decline in the sale of spirits indicates a downward trend. We may reach a stage when the Taoiseach, by imposing this tax, will do more for the pioneer movement than Father Matthew ever thought could be achieved. If Father Matthew is looking down he is smiling at the Taoiseach and saying: “You did a good job. I could not do it. You seem to be making a better hand of it”.

Mr. T.J. Fitzpatrick (Cavan-Monaghan): Having achieved the highest post in this land the Taoiseach wants to be canonised as well.

Mr. M.P. Murphy: In 1979 people were buying farms at prices far beyond value. I advised some of them that there must be a stop, that farm prices could not continue to go up and up while the value of money was falling. Apparently the Taoiseach thinks there is no end to the money to be got from drink. I suggest that the peak has been reached. I do not want to be taken as promoting drinking, but having a drink is traditional in Ireland — we all take a drink — but there is no obligation on our beloved Leas-Cheann Comhairle to do so; he has freedom of choice. However, this is the spirit that prevails here and for that reason I am opposed to all three Financial Resolutions.

The Government expect to collect an [486] additional £49 million in this way. I do not think the Taoiseach will be too popular because of this. If two people go into a pub and call for two half ones the Government will pocket 72p straight away. It is too much. The Government are taking more over the counter for drink than the publican, the distillers and brewers and the transport interests — they are taking more than 50 per cent of the counter price. People like a pint after a hard day's work in Dublin and throughout the country and now, already collecting 28p, the Exchequer are adding another 6p to the price of the pint.

Mr. T.J. Fitzpatrick (Cavan-Monaghan): The budget speech today and other publications we have been reading indicate a demand for wage moderation. It has been emphasised that we are becoming less competitive and that that is causing unemployment, damaging our balance of trade and our balance of payments. The three Financial Resolutions we are dealing with now, especially that relating to beer and spirits, will generate a demand for wage increases because the effects will be included in the cost of living index. Though we may not regard these things as necessaries of life, they are regarded as simple luxuries and this substantial new tax on them will start another round of wage increases. Deputy Bruton said earlier that the effect of the budget will be to put up the cost of living by two or three points.

There is some abuse of alcohol in Ireland but it is fairly limited and those who abuse alcohol will not be deterred by further taxation. They will forego many other things to get alcohol, possibly at the expense of their families. In latter years the abuse of alcohol has been greatly reduced and during the week one finds very few people in public houses up to about ten o'clock. They are now spacing their drinking and going in for an hour or so before closing time to have a couple of “civilised” drinks. Long ago I heard the Taoiseach use that term when advocating eating and drinking in restaurants without licensing restrictions. Public houses are not doing all that well at present, with some exceptions, and this [487] will affect employment in the licensing trade.

I have often wondered why our whiskey exports have not captured a greater share of world markets and I was interested to receive a circular from the distillers setting out their position. They are competing with Scotch and other foreign distillers who have a far bigger home market and who can therefore compete on better terms. Our distillers are operating in a very small home market of approximately three million people and if their sales are cut they will be in a worse position to export and make a profit. This further increase of 12p on a glass of whiskey, increasing the tax content to over 71p, is bound to hit our home distillers. They were complaining of being in a bad position last year and this could be the straw that will break the camel's back and cause unemployment at home as well as affecting our balance of trade. The increase of 6p on the pint to bring in a further £32 million will reflect itself in a demand for increased wages.

Some people have not much sympathy for the person who buys a bottle of wine. Are we not saying with one breath that a tax on spirits and beer will reduce the abuse of alcohol while at the time discouraging the use of wine, which is a weaker and less damaging drink? People are using wine with discretion and the effect is to cut down the number of drinking sessions. Twenty years ago there was far more drinking on a Sunday morning in rural areas than is now the case. Public houses, which used to be very busy around mid-day, are comparatively slack now and people are substituting by having wine with their meal on a Sunday. Are we to discourage that? The cumulative effect of these three resolutions is bad for employment and bad for our balance of trade and balance of payments and the tax on wine is bad socially. However, the taxes are necessary because the Government have bungled along since 1977 and have run the country very badly. They now find themselves on the run-in to a general election, whether it comes in February, March, the summer, the [488] autumn or next year. We are round the bend and heading for the home straight.

The Taoiseach: Is the whip out?

Mr. T.J. Fitzpatrick (Cavan-Monaghan): The Taoiseach would need to get out a fairly severe type of whip, made of whalebone or something of that nature. The country has been managed in such a way by the Taoiseach and his party that this is the best he can offer in the home straight. It speaks louder than anything else for the state of the country. These resolutions will do no good to temperance or to the economy and should be opposed.

Mr. Enright: Some years ago there was a popular song called “The Pub with No Beer”. When the full impact of these increases is felt there will be plenty of beer but very few drinkers. The increases announced today are very sizeable and the commodities involved have already been hit so often and so hard that saturation point has now been reached. If the Taoiseach had asked any of his backbenchers about the present position of the licensing trade in rural areas he would have been told that there has rarely if ever been such a slump. There are a number of reasons for this and the cost is one of them. People cannot afford to buy drink and I believe that they have become more mature in their drinking habits. People attending social functions often go with a teetotaller or arrange for special buses due to the breathalyser laws. The difficulties being experienced in the licensing trade are very obvious. They are experiencing unprecedented difficulties at present.

Over the past few years major improvements in our pubs were carried out and they have improved the appearance of many villages, towns and cities. These improvements were not grant-aided but when they had been carried out the rates were increased. I believe we have reached the stage where people are no longer improving their premises.

So far reference has not been made to the tourist industry. The chief executive of Bord Fáilte and everybody involved in [489] the tourist industry must be very concerned about these increases, and I do not blame them. That industry has been experiencing many difficulties over the past few years. People who spent a lot of money improving their hotels have also experienced many difficulties. Last year many people blamed the weather for these difficulties but last year I told the then Minister for Finance, Deputy O'Kennedy when he was introducing his budget, that the tourist industry would be affected by the increase in the tax on beers and spirits. I was unfortunately proved right, and the same will happen this year.

Many people who had decided to come to Ireland for holidays this year will now reconsider and may change their mind. That will be a pity because Ireland has a great deal to offer any tourist. Bord Fáilte spent a large sum of money on promotional campaigns and I regret to say most of it will be wasted because it is so expensive to holiday in Ireland. I am sure the Taoiseach has met many people over the past 12 months and discussed holidays with them. People who like a few drinks, a bit of crack and to have a good time find it cheaper to fly to Spain, the Canary Islands or somewhere like that for a holiday than to stay at home because the price of beer, wine, spirits and so on is often the determining factor when deciding on a holiday. It is a terrible pity this happened. It is also a pity to see the wonderful work done by Bord Fáilte handicapped by these major tax increases.

I feel sorry for anybody who owns a hotel and is depending on the coming tourist season. Throughout the year there will be a number of young girls and men hoping to make a living out of this industry. People in small guesthouses have a short season and these taxes will deal them a very hard blow. We should start thinking about where we are going. Last year the then Minister for Finance said the situation had not reached saturation point. The report in today's Irish Independent shows that we have now reached saturation point, and that is what concerns me. These old reliables are being [490] kicked to death. We should take a further look at them and revive them instead of further kicking them. Only so much can be added to the price of beer and spirits and we have now reached the limit.

The tax on a glass of spirits is 71.4p a mighty amount. How much further can we go? I do not know. Irish Distillers warned that there was a 5 per cent quantity fall in spirits sales on the home market in the 12 months to 30 September last. Their spokesman said that, irrespective of what happened in the budget, short-time working was inevitable and would touch on 520 workers in Cork and Dublin. I believe these tax increases will make a bad situation even more difficult.

The licensing trade has gone through a very difficult 12 months. The number of people employed in that trade is getting smaller. This is a very big industry which pays very good wages. These increases will affect the people in the spirit and brewing trades. In my view with these increases we have gone for the overkill and we will have to take a serious look at the situation. We should be encouraging the production of spirits in every way possible because this is a very important export trade and tax increases of this size can be seen only as discouragement.

The Taoiseach: They do not affect exports.

Mr. T.J. Fitzpatrick (Cavan-Monaghan): These increases make them less competitive and less profitable at home.

Mr. Enright: These people found it helped to have a good home base and these increases will have an effect right across the distilling industry because they are far too heavy. I would have gone along with a small increase today, but these increases are far in excess of anything I expected and what the trade can stand. I am not as concerned about wines, and if there was a separate vote on them I would not vote against the increases, but I am opposed to increases of this magnitude on beers and spirits.

Mr. Mitchell: I was interested to hear the Taoiseach say that the excise duties [491] proposed are not going to affect exports. I declare a certain interest because I have a connection with Guinness for a long time. When you add the brewers' and the publicans' margins to the Financial Resolutions, it is going to have such an effect on the cost of living and on wage costs that it will become more profitable for brewers to brew abroad rather than at home. Wage increases are chasing price increases and our rate of inflation has been pushed up much higher than our competitors in the European Continent and in the United Kingdom.

The Taoiseach: The rate of inflation is falling.

Mr. Mitchell: It will not fall after this budget.

An Leas-Cheann Comhairle: We are not debating the rate of inflation. There will be plenty of opportunities during the next few weeks to debate inflation. We will debate excise duties on three items.

Mr. Mitchell: The Taoiseach will go down as the leader who brought about the 75p pint and the 75p punt. It will be much more than 75p for the pint and the punt will be worth less than 75p. That is what the policies of the Government have brought about.

With regard to beer, the working man is being savagely attacked in this budget. It is disgraceful. It will have an ultimate effect on unemployment and is totally at variance with what the country needs. The economists will work out the cumulative effect of these resolutions but it is certainly going to push the CPI for the nine months period ending on 28 February above the 10 per cent mark. That is a matter for great concern because it means a renegotiation of the second phase of the national understanding with all the consequences that entails. I know the Chair will not let me discuss the national understanding——

An Leas-Cheann Comhairle: The Deputy is discussing matters that do not arise on these three resolutions. He will have [492] plenty of opportunity tomorrow, next week and the week after to discuss it.

Mr. Mitchell: These resolution directives will push the CPI above 10 per cent for the nine month period ending on 28 February. I challenge the Taoiseach to deny this. That has very serious implication for the national understanding which already is being paid for, as we predicted, in Irish jobs and it will be paid for in more Irish jobs. That is why we oppose these resolutions.

The Taoiseach: I am sorry that the Fine Gael Party and the Labour Party find it necessary to oppose these resolutions. In particular, I find it quite extraordinary that the Fine Gael Party should have voted against Resolution No. 1 on tobacco. I will deal with some of the points made on Resolutions 2, 3 and 4. I do not think there is any need for me to remind the House that this type of debate takes place on practically every budget. The number of Governments since the foundation of the State who did not find it necessary to tax tobacco and drink to some degree in a budget must be very very few indeed. If you want to get revenue you must tax something which is reasonably popular. It is no good putting a tax on something which as soon as you tax it disappears. People will not buy it any more and you get no revenue from it. To get the sort of revenue required these days you have to tax things which are in fairly popular usage. Of course, the obvious things to tax are beer, spirits and wine. These are things which people are going to consume anyway and, therefore, it is almost axiomatic that, if you want to get the sort of revenue you need to pay for the various State services in a modern community, you are almost inevitably driven to taxing tobacco, beer and spirits to some extent. The Opposition parties are foolish in opposing these measures because of the purposes to which the revenue will be devoted. I do not think it is unfair for me to say——

Mr. T.J. Fitzpatrick (Cavan-Monaghan): To pay interest on money that was extravagantly borrowed——

[493] The Taoiseach:——that, in opposing these particular revenue measures, the Opposition parties are opposing the raising of the revenue to pay for the social welfare increases, the children's allowances and better pensions for old people.

Mr. T.J. Fitzpatrick (Cavan-Monaghan): Nonsense, the Government are borrowing that money.

An Leas-Cheann Comhairle: There should be no interruptions while the Taoiseach is speaking.

The Taoiseach: I would, perhaps, accept that there was some validity in this opposition if we were taking revenue and using it for some foolish purpose, if we were buying intercontinental ballistic missiles, for instance——

Mr. Enright: Or executive jets.

The Taoiseach:——or spending it on some foolish, unwise Government project. We are not spending it foolishly. This revenue is being raised and the money raised will be used to pay social welfare benefits, to pay for the things that the Minister for Finance has provided for in his budget for the poor, weaker and underprivileged sections of our community. That is what these taxes are being put on for. That is the purpose for which the money is being used. That is what Fine Gael and Labour are opposing in opposing these taxes.

Mr. T.J. Fitzpatrick (Cavan-Monaghan): And two more secretaries in the Taoiseach's Department.

The Taoiseach: I want to deal with the question of Irish Distillers. It is difficult to know what the reality is in this regard. We all know there is a great ritual exercise gone through before every budget. There are particular people in the community who orchestrate a whole chorus before a budget, proving that if the thing in which they are involved is taxed, ruin will follow. One can recognise it. The same pattern is followed every year. People [494] try to frighten the Government off imposing taxes on their particular area by a whole orchestrated chorus of propaganda. We had it in a big measure this year. Very large sectors of the community set out to establish before the budget is introduced that their particular sector must be left alone because, if not, total ruin and disaster would follow. I do not know what the reality is in so far as the Irish distilling industry is concerned. I do know that if there is some falling off in the consumption at home as a result of these duties then surely the obvious thing for that industry to do is go out and make good that deficiency on the export market. Despite what Deputy Enright thinks, excise duties do not apply to exports.

Mr. Enright: Deputy Enright neither thought nor said that.

The Taoiseach: Nothing we do here today in regard to these duties has the slightest effect on the competitiveness of Irish spirits.

Mr. T.J. Fitzpatrick (Cavan-Monaghan): Obviously the Taoiseach did not read the literature of Irish Distillers because they explained their case.

An Leas-Cheann Comhairle: Deputy Fitzpatrick should not interrupt.

The Taoiseach: I did not feel it necessary or incumbent upon me to interrupt one single speaker on that side of the House.

Mr. Mitchell: The Taoiseach interrupted me.

The Taoiseach: On a point of information only.

An Leas-Cheann Comhairle: That is sufficient; Deputies will not continue to interrupt.

Mr. T.J. Fitzpatrick (Cavan-Monaghan): The Taoiseach finds it necessary to take the rather unusual course of replying at length.

[495] The Taoiseach: Any duties which are imposed here today on beer and spirits will not have the slightest effect on the competitiveness of those products on the export market.

Mr. T.J. Fitzpatrick (Cavan-Monaghan): I am surprised at the Taoiseach.

The Taoiseach: Some Deputy opposite pointed out that the products of the Irish distilling industry find their main competition from the Scots' distilling industry. The Irish distilling industry at present has a currency advantage of roughly 25 per cent over Scotch whiskey.

Mr. Mitchell: And a wage disadvantage.

Mr. T.J. Fitzpatrick (Cavan-Monaghan): They are exporting to other markets where that does not apply.

The Taoiseach: All I would ask is that Deputies opposite show some manners and let me make my case. Let me make my case and then they can do what they like.

An Leas-Cheann Comhairle: The Taoiseach to conclude without interruption, please.

The Taoiseach: The Irish distilling industry has that enormous currency advantage in relation to its principal competitor at present. Furthermore, if I recall correctly, the Irish distillers, with very considerable assistance from the State, have built a new, modern distillery down in Midleton. It is probably one of the most modern distilleries in the world; if it is not, it should be and it has received very considerable grant assistance from the Exchequer through the IDA. There is the Irish distilling industry with a new, modern distillery built with considerable assistance from the taxpayer, a very considerable currency advantage over its principal competitor with nothing we do here today affecting the competitiveness of their product on export markets. If there is some falling off in the consumption [496] of their product on the home market surely it is not unreasonable for us all to ask them to go out and make up the deficiency in the export markets. But I am not even convinced that there will be a falling off of consumption on the home market.

Let me make another point. Deputies opposite were at great pains to persuade me that the Irish public are becoming very reasonable and moderate in their drinking and therefore we should not be imposing this cruel tax on the Irish drinking man or woman. I do not accept that. Surely Deputies opposite, just as I have over the last 12 months or two years, have seen from time to time in our newspapers and our media, consistent reports of seminars which give staggering figures for the amount the Irish community spends on drinking in any year.

Mr. Mitchell: That is because two-thirds of it goes to the Exchequer.

The Taoiseach: These figures of the amount that we, as a community, spend on drink are frequently highlighted in the most dramatic terms in our newspapers and media. Do Deputies opposite say that that is not so——

Mr. M.P. Murphy: May I ask the Taoiseach a question?

An Leas-Cheann Comhairle: When the Taoiseach concludes.

The Taoiseach: ——and, that as a community we do not spend a very high proportion of our national income or resources on drink? I think that is the position, at least as I find it from these reports and I have never seen it contradicted by anybody in this area.

Is it not true also that the Irish trade union movement has found it necessary to institute programmes designed to cut down absenteeism in Irish industry because of alcoholism? Is that not so? Do the Deputies opposite say that that is not true? I know it is true because I am in very close touch with the trade union movement about this matter. I know it is a very serious cause of concern to the [497] trade union movement and to Irish industrialists, that is, the amount of absenteeism in Irish industry because of alcoholism, and not necessarily alcoholism but just because of excessive drinking.

That is the other side of the coin. Therefore, it is all very well to get up here in this House for a particular purpose, for the sake of a given argument, or to emphasise a particular case and say that generally speaking the Irish people are very moderate and reasonable in their drinking and that it is very unfair and cruel to impose these taxes on them. But there are those two other factors which the House should keep in mind. I do not really think that this argument about the effect these taxes will have on the drinking habits of our community are all that relevant in this context. I do not think any of us can assess what will be the effect with any degree of accuracy, or foretell with any degree of accuracy what will be the effect. I am just rejecting the argument that we should not put on these taxes because drink, in our circumstances, is very moderately used and that it is unfair to do so for that reason. I base my case for these resolutions on one simple premise, that is, drink, alcohol, beer, whiskey, wine, these things are good reliable, old revenue producers. Human nature being what it is——

Mr. T.J. Fitzpatrick (Cavan-Monaghan): One would have expected something more imaginative from the Taoiseach of all people, particularly some more imaginative tax.

An Leas-Cheann Comhairle: The Deputy has spoken already ——

Mr. L'Estrange: But the Taoiseach said a few moments ago that these were cruel, harsh and unjust taxes. Those were his own words.

An Leas-Cheann Comhairle: Deputy L'Estrange should not join in at this stage. The Taoiseach to conclude.

The Taoiseach: I forget what I was saying. These ignorant interruptions ——

[498] (Interruptions.)

Mr. L'Estrange: I hope the Taoiseach is not suffering from loss of memory.

An Leas-Cheann Comhairle: Please Deputies, we have another five resolutions.

Mr. P. Barry: The Taoiseach was saying that they were excellent revenue producers, the old reliables.

The Taoiseach: I always find that when one is making a very telling argument against the Fine Gael people they resort to barracking, shouting and ignorant interruptions. It is always great proof to me that I am on the right track when they start shouting and interrupting ——

(Interruptions.)

An Leas-Cheann Comhairle: Deputies please, the Chair must be respected once in a while. I expect some leadership from Deputy Fitzpatrick I do not mind Deputy L'Estrange, one can expect nothing——

The Taoiseach: Ah, that is very hard, he has been known to behave with dignity on occasions.

Mr. L'Estrange: The same as the Taoiseach.

An Leas-Cheann Comhairle: Once in a blue moon. The Taoiseach to conclude.

The Taoiseach: I base my argument in favour of these resolutions on this simple premise, that these are well established, reliable revenue producers.

These are not basic necessities of life. They are certainly an important aspect of relaxation and enjoyment in the community and I would not ever attempt to adopt a killjoy attitude in relation to them but we must accept that they are not basic necessities of life, and they are good revenue producers and we need this revenue for the very sound social purposes of this budget. I would like to make [499] this point to the Fine Gael people in their own interest. I find, going around talking to people and looking at reports, even market opinion pools, that the ordinary man in the street has the reaction that he does not mind paying a bit more for his pint or his glass of whiskey provided the old age pensioner is looked after. Everybody in this House would agree with that.

Mr. L'Estrange: He does not like paying it to pay the interest on the manifesto.

The Taoiseach: One will always mollify the drinking man in this country if one satisfies him that the extra tax being extracted from him is going for a good social purpose and particularly for the purpose of looking after the old and the disadvantaged and the underprivileged in our community. This is a very sound argument and Fine Gael are trying to get a little temporary political advantage by opposing these resolutions. They should consider that much wider, much broader, much deeper sentiment in the Irish public. These increases are fairly substantial. The Government recognise that but we have a very tight, difficult budgetary situation this year. We are determined to keep down the budget deficit, to reduce it. We wanted to make these adequate provisions for the social welfare classes, particularly for the old and pension categories and, looking around the entire taxation spectrum, these offered themselves as one of the best avenues available to us. We feel that the people who will be paying these extra taxes for their beer and spirits or cigarettes or wine will understand and appreciate that they are going to a very sound social purpose and bear with them perhaps not cheerfully but at least willingly.

Mr. M.P. Murphy: Am I to assume from the Taoiseach's statement that he considers it fair and just for the State, under the resolution before the House, to take £7.15½ on each bottle of spirits, that is the ordinary 26⅔ ounce bottle, and £31.50 on every keg of beer which publicans buy containing about 90 pints? Am I to assume that the Taoiseach, as head [500] of the Government, is satisfied that these old age pensioners about whom he expresses so much worry and who need this kind of drink possibly more than any other section of the community are to be asked to pay £7.15½ on a bottle of whiskey or a bottle of gin or vodka and to ask the ordinary drinking public to pay £31.50 per keg of beer?

The Taoiseach: I do not think there are very many old age pensioners who buy bottles of whiskey or kegs of beer.

Mr. L'Estrange: They cannot afford it.

The Taoiseach: My case is not really based on fairness and justice. I do not think there is any such thing as an ideal tax. All I am saying is that the purpose to which we are putting the revenue raised by this tax is a sound social purpose and I am certain that in the budgetary situation this year, if we were to provide these necessary increases for social welfare recipients and children's allowances and those other desirable social purposes, this was the only way we could get the amount of revenue we required.

Mr. M.P. Murphy: Would the Taoiseach not accept that this is due to the 1977 manifesto?

Mr. Mitchell: Arising out of what the Taoiseach said about the amount of money we spend on alcohol as a percentage of our GNP, what percentage of it goes to the Exchequer and what will the percentage increase be as a result of this resolution?

The Taoiseach: I do not understand the question.

Mr. Mitchell: The Taoiseach quoted statistics stating that we spend a bigger proportion of our GNP on alcohol than any other country.

The Taoiseach: I did not say that.

Mr. Mitchell: The Taoiseach said something to that effect which is largely true. Will the Taoiseach admit that is [501] mainly because of the huge percentage of the cost of beer and spirits that goes to the Exchequer?

An Leas-Cheann Comhairle: I take it that I am to put the three resolutions together.