Seanad Éireann - Volume 35 - 30 June, 1948
Finance Bill, 1948 (Certified Money Bill)—Second Stage (Resumed).
Question again proposed: “That the Bill be now read a Second Time.”
Mr. D. Burke Mr. D. Burke
Mr. D. Burke: I consider that the four years' agreement which we have entered into with Britain should be of help to our Minister for Finance in making his plans for many years to come. About 1921—that was three years after the ending of the first world war—there was a collapse in agricultural prices which resulted in great disadvantage to this country. This recent agreement gives us four years in which to put our house in order and to make the best of our economy. I think all Senators will agree that increased production is the solution for all our problems. If we are to get that production it will be the measure by which capital and labour, farmer and farm worker can come together to solve our problem. I am afraid that many of us have been afraid to approach that problem in a realistic manner. In the dairying industry, for example, the farmer and his helpers will have to find a solution as to how best to strengthen that industry, as to how they can make satisfactory progress and get proper results for their hard work. I think that if we are to get the desired results we will need to have some system of profit sharing. I think that, in fact, will have to be the approach to the whole of our industrial progress in the country if we are to have any success in it. The desired results will not be got by increased taxation or by dividing what is there. The object should be to increase the national pool and then give everybody a just and true division. I think if we proceed along that line we are going to be successful.
 We all deplore the unjustly high profits that were made by some people during the emergency period as well as the vulgar spending that has been all too apparent, particularly here in the City of Dublin. We should not forget that there are many people in industry and commerce who proved true to their trust and to the vocations they follow. I know some people who carried on their industries during pratically the whole of the war period at a loss, and who sold their goods at a loss. If we want to plan properly for the future we will have to admit that there have been good industrialists and bad industrialists. In fact, that is true of all vocations in the country. I want to suggest to the Minister that an initial allowance, similar to that which is being given in Britain, should be provided here for the wear and tear of machinery. Everybody in industry knows that a machine that could be bought ten years ago for £1,000 may cost £4,000 to-day. I suggest that unless there is a special wear and tear allowance, industry here will not be in a position to rehabilitate itself or to compete in the export market, and we know that it is the desire of the Minister for Industry and Commerce that Irish industry should be able to do that. In addition, unless that special allowance is given, Irish industry will not be able to give manufactured goods to the people of this country at the right price and thus help to keep down the cost of living. I suggest to the Minister that he should insert in this Bill two sections similar to those inserted in the British Income Tax Act of 1945, Part II, one dealing with plant and machinery, and the other with industrial buildings and structures. If sections similar to these were adopted here, they would, in my opinion, be of infinite value to Irish industry. They would be appreciated by industrialists who would see that the Minister was considering the true interests of industry.
There is another matter that I desire to bring to the Minister's notice. In this country we tax the first £100 of all estates for death duty purposes, while in Britain they have seen fit to allow the first £2,000 free. Our Government has been encouraging people  to purchase houses. In this country, when a man dies and leaves a widow the State is a great deal more harsh to her in the measures it takes in regard to these death duties than the Government in Britain is. I would ask the Minister to look into that matter and see if he can put into force a policy that will protect people more in their property, and that will result in a greater distribution of property among all the people. That, I believe, would have a stabilising and a beneficial effect in the country. I believe that it would help to keep many of our people from going over to England. It is sometimes said, in a jocose way, that many of them go over for no other purpose than to set their watches. If those people had positions at home it would be of great advantage to the country and, in the long run, would lead towards progress. The new tax that has been imposed—the 5 per cent. stamp duty when property is purchased—should, in my opinion, be modified. I hope the Minister will see his way to do that. It is really a new capital levy on many farmers, business people and others who wish to acquire property for the means of production or otherwise. In addition to all the other charges they have to meet, they now find this new impost being levied on them. I do not think that this 5 per cent. stamp duty is good business. In my opinion, it is holding up, in great measure, the sales of property. I think that if there was a considerable reduction made in this tax the Minister would receive a greater benefit from the reduced tax than he is receiving from the present tax which, as I have said, is none other than a capital levy.
I ask the Minister to consider these matters seriously and see how he could meet these points. They are not put forward for the good of a particular section but for the good of all the people. It is not to the State we must look in the first instance to help us to overcome our troubles. It is for all of us, in our various vocations, throughout the country, to work harder and more intelligently in our daily work, as that is the way we really will make progress.
Professor Bigger Professor Bigger
 Professor Bigger: I am very far from considering myself a financial expert and I had no intention of joining in this debate until I heard Senator Hawkins' speech last week. He made one criticism of the present Government about which I think I may be competent to express an opinion, that is, the cancellation of the transatlantic air services. I do not think I can be accused of being opposed to air travel, as I have travelled about 11,000 miles by air in the present year. It cannot be said that I am prejudiced against Irish air services, as I travelled by Irish services on every possible occasion. Despite this, I consider the decision of the present Government to cancel the transatlantic service as being entirely justified. There has been a great deal of nonsense talked and written about this subject. It has even been claimed by people who ought to know better that this service would be a paying proposition. In my opinion, that claim is quite absurd. I was informed a couple of months ago on good authority in America that every American air line engaged in transatlantic services was losing money on those services. Some of them were fortunate enough to make up those losses by their internal services—but not all of them could do so. T.W.A., one of the largest American companies, has been twice reorganised, and business men know what reorganisation means. Very recently, one of these companies appealed to the American Government to advance enough money to pay the interest on the debenture capital. That does not look particularly promising.
I travelled across the Atlantic in April in a T.W.A. plane. There were four passengers on board and a crew of seven. Two of the passengers were going to Paris, while two of us got off at Shannon. If that were an Irish plane, I am afraid it is fairly certain that the two passengers for Paris would not have travelled by that route and so the plane would have crossed the Atlantic with a crew of seven—and very high overhead costs—and with only two fare-paying passengers. On the same day a plane of another American company arrived at Shannon with six passengers. Five of these were employees of various air lines and, therefore,  were not paying at all. That particular plane had one paying passenger. The best possible method of losing money, if people want to lose money, would have been to continue the projected transatlantic service. Personally, I very much regret its cancellation, because I hoped to travel by that route, but I had to travel at the expense of an American company.
The project could be defended only on grounds of prestige. I quite agree that prestige is worth paying for and I feel quite proud when I see an Irish plane on a foreign air field, proud that it is an Irish plane. If you lose a moderate amount of money on the existing services to Great Britain and to a certain number of European capitals, that money may be well expended on grounds of prestige; but we can pay far too high a price for that and I think the price we would have had to pay for the transatlantic services was far too high. Therefore, I would like to congratulate the Minister and the Government on a decision which was not merely courageous but eminently wise.
Mr. Ireland Mr. Ireland
Mr. Ireland: I approach every piece of legislation in this Chamber from the point of view of the reunification of our country as a primary object of Irish politics. From that point of view, I watched the policy of the previous Government with care, and I think that its economic policy might be shortly defined as an attempt at economic nationalisation. So far, I was in agreement, if that economic nationalisation had been backed up by a national financial policy, if that had been possible. It seems to me, however, that there are limits to economic nationalisation in terms of international finance. Watching that process in the previous Government and seeing that it could not go any further on account of the shortage of supplies in the world, on account of block buying and commodity scarcity, I thought we had come to the point where, as I expressed it in an epigram, “the Six-County Protestant prefers the ills he has to the same ills translated into Gaelic”. Therefore, though I watched with great sympathy and was actually in support of the policy of economic nationalisation pursued by the previous Government, I do not  think it will go any further in terms of international financial policy.
That is why, if the resumption in real national sovereignty is impossible and no shining example can be shown to the North of a new and radically different financial system—and I do not think it is possible just at the moment —the line the present Government is following is the line of common sense. Always looking at this from the point of view of one who looks upon the supreme issue in Irish politics as the reunification of our country.
I congratulate the Minister and the Government on the recent agreement. Everything that levels up the terms of trade between the Twenty-Six Counties and Britain with the terms between the Six Counties and Britain is obviously demolishing the unnatural Border between the two parts of the country. Therefore, I welcome that step and I hope that the process just begun in London can be carried further. I hope—and I know—the Minister will sympathetically regard the possibility of building up social services gradually in this part of the country until they are approximating to the social services in the Six Counties. Together with freer conditions of trade, that is a factor which is going to demolish the unnatural boundary between the two parts of the country.
In saying this, I do not wish to cramp my position as a monetary reformer in the least. In the world of plenty—and as I am quite aware that sitting very near me is a very eminent economist, let me qualify that and call it potential plenty—there was in the years before the outbreak of the last war, a possibility of reviving our national sovereignty in finance. I do not think it is possible now. Once we have an all-Ireland Parliament in being, this question will come up again. In the meantime, it seems to me to be the most sensible thing to do to level up the trade of the Twenty-Six Counties with Great Britain with that of the Six Counties with Britain and to build up the social services.
This question of the resumption of our national sovereignty will come up again some day. I hold in my hand here a copy of a paper, Senate document No. 23 of the United States of  America, a very interesting document which is Lincoln's outline of the national financial policy. There may not be many who know that Lincoln was a financial reformer. He saw the evil of money power and there were various people who thought and believed as he did and that attitude in regard to money power had some part in the assassination. That has not appeared in the paper, but it was so. Therefore, while congratulating the Minister on the steps now being taken and while I support the present Government within the present framework of finance, as being two things most eminently sensible, I do not think I have to remind the Minister—from what I know of his record and his intelligence in these matters—that when we have got the unity of the country this question of our national sovereignty in finance will come up once more.
Dr. O'Connell Dr. O'Connell
Dr. O'Connell: May I add something to the debate and the criticism I have heard? The main criticism of the Minister's proposals, especially from the other side of the House, had to do with the savings that were made and the economies effected by the Minister in the course of his Budget and principally in connection with the turf scheme. I regard the turf scheme, as most people do, as an emergency measure, something we felt we had to do to strengthen our position during the war. We increased our Army to a high number of personnel and also started this turf scheme as a necessary measure—in its own way, as a defence measure. No one would suggest, however, that when the emergency was over and the war aim had disappeared we should continue a much inflated Army. We had to get rid of the surplus numbers remaining in the Army, even if it caused unemployment, as it was bound to do. I never heard it suggested that the previous Government, if they remained in power would continue the turf scheme and keep the same numbers employed as we had during the emergency.
That does not mean as was hinted in some quarters that turf will cease to be produced. Turf was produced in this country in the intervals between  World War I and World War II, and I assume it will continue to be produced at the same rate and even at a greater rate in view of the fact that the price of other fuel is very much higher than it was before the war.
I was not surprised to hear Senator Mrs. Concannon say that she had received a letter saying that turf was dear and scarce. What else would that person say? Surely, he was not going to say that turf would be plentiful and cheap, seeing that it was his line to say it would be scarce and dear.
With regard to air services, as Senator Bigger has said, no one liked to see these services being cancelled, but it was a question of what we could afford. There is not one of us but would like to have a Rolls Royce and a radiogram if we could afford them, but we cannot afford those things as we cannot pay for them. The Government looked at it in the same way— we would like to have these Constellations in our air services but they were not something which we could afford. The same applies to the shortwave radio station. Speaking of radio services and broadcasting I would like if the Government would turn their attention to doing something that would be perhaps of more practical benefit to the country here and that is the provision of weather forecasts in the mornings especially during the harvesting months when the people are anxious to get ahead with the saving of their crops. I was interested in the remarks of Senator Professor O'Brien about income-tax and to a large extent I agree with what he said in relation to the way in which income-tax regulations press upon those with fixed incomes. We heard some few years ago that the income-tax code was to be amended and overhauled and I am anxious to know if anything is going to be done about it. There are many anomalies indeed in the code that would bear examination and possibly rectification. The salary man is the first to be hit in times of scarcity. Prices go up and even though he may be able to get increases in wages he can never hope to catch up on prices. A Government is in much the same position as the individual in this regard. When times are hard the  Government will usually increase income-tax but the increase comes mainly from the small individual who finds the times more difficult and finds it harder to make ends meet.
As a rule, the industrialists, the producers, the distributors and merchants and commercial people generally, even in times of scarcity, manage to make profits. In fact it is said that they make even bigger and greater profits in times of scarcity than at other times. It is only right, therefore, that they should have to pay greater income-tax, but it is rather unfair that the small people, who suffer more and are harder hit generally, should have also to pay increased income-tax. Take the case of a man with £250 a year. It is an anomaly that he is charged the same income-tax as the farmer with a poor law valuation of £300. There are anomalies in this code and I would be glad, if there are proposals to overhaul it, that these anomalies would be looked into. Of course it is very hard, in fact it is impossible, for a Minister for Finance to satisfy everybody. I think the best test of the Budget is the number of people who are satisfied. I certainly was disappointed, not with what it said but with the several things that it left unsaid. Like Senator Mrs. Concannon and, I think, Senator Hawkins, who made reference to many matters, I was especially interested in pensions for State civil servants and teachers. This was raised with the former Government and the former Taoiseach expressed the view, a view with which I could not agree, that once a public servant served his time and got his pension the State holds no other obligation towards him. That was stated by the former Taoiseach in the course of discussions which the representatives of the Teachers' Organisation had with him two years ago. Although the cost of living has increased to the extent that it has since, these people still have the same pensions that were awarded to them before the war. They were based on particularly low salaries. Indeed, some of those people have pensions much less than £1 per week and nothing has been done up to the present to relieve their need.
 The Minister for Education speaking about one month ago in the Dáil, when winding up the debate on the Vote for the Department of Education on May 26th, said that the question of pensions for teachers was under consideration and that he had put proposals before the Minister for Finance. This was one month ago and we have heard nothing since. Surely this is a matter, if it is to be done well, should be done quickly. These old people are in a very bad way. Some of them are already passing out and I would like to urge the Minister very strongly to make any decision he proposes to make as soon as possible. There is another matter to which I should like to refer. I think it has been referred to by Professor Stanford and others, namely, the question of savings. I would like to know what has become of the savings movement we had here before the war. It has been allowed to fade out and, I think, this was a great mistake. This movement should be revived and encouraged. It was organised through the schools and other societies and organisations throughout the country. In this way a good deal of money passed out of active circulation and it also had the effect of encouraging habits of thrift amongst the young people. I would be glad if the Minister would tell us whether it is proposed to revive that movement because I consider it was a useful one and should be encouraged especially amongst the younger people.
Mr. Baxter Mr. Baxter
Mr. Baxter: This Budget, I think, will be classified in a different category from any of those introduced in this House for a very long time. From my observations, it has received much less criticism than any Budget for ten or 15 years. It is the largest Budget ever passed here in the form of a Bill. I found a little surprise and disappointment in the fact that Senator Hawkins's colleagues have not found many more faults with the policy announced by the Minister in the Bill than they have found.
Mr. Hawkins Mr. Hawkins
Mr. Hawkins: They are looking for the policy.
Mr. Baxter Mr. Baxter
Mr. Baxter: Well, if you want anything, just go searching and you will find it. Ask questions about it if you  are not clear. I think this Bill, from the point of view of the country, is a great tribute to the Minister, because he has had to come in and take over, as it were, a piece of mechanism rather badly out of joint and perhaps not very well able to bear the stress being put upon it. I think, however, we have got to be very serious about the position revealed by the Budget. We have got to examine, as fully as we can, all the implications, because a small country like this, spending as much money as we have been spending annually for a long time and, to a certain extent, living so much on our own fat, must recognise that the economic situation here is rather grave. I feel it is fortunate that we have at the helm, in the person of the present Minister for Finance, such capacity for dealing with the situation. The people interested in our economic affairs will be able to deal with a brain like his in such a way that it will be an encouragement to the country and make the people feel that what they are told about the country's affairs will be true and they will face up to the problems in a way that they have not faced up to them for a long time.
Generally speaking there are two points of view in the country. So far as I hear, the Opposition say that the Finance Bill makes provision for too small a burden. These people apparently would be better pleased if it was higher but I do not know where they think they could find the money. The Minister has found that we cannot spend our way into prosperity. The Opposition apparently feel that we can. When they come to examine the cuts and savings which Mr. McGilligan has attempted, I feel that they are not quite fair and are not attempting to be realistic about the nature of these cuts. It is true we had something on this from Senator Hawkins but it is unfortunate that he did not get better support from his colleagues. When discussing the savings on the turf scheme was he quite fair with the Minister and the House and the country and especially with the people in the turf production areas? He blames the present Government for the reductions made in the turf development scheme. He  gave figures regarding the savings or cuts made in Galway by the Galway County Council on turf production this year. I would like if Senator Hawkins would tell us who is responsible for this decision. So far as my county is concerned and Senator O'Dwyer is here also and will speak for his county, the decision to cease turf production by the county councils was taken before this Government took up office. We had a circular, sent to my county council,—I spoke of it here before— thanking us for what we had done. The man who stopped the hand-won turf schemes under the county councils was the last Minister for Industry and Commerce or the last Minister for Local Government.
Mr. Hawkins Mr. Hawkins
Mr. Hawkins: On a point of explanation: there is one thing that I am very reluctant to do and that is to intervene when a speaker is on his feet. This is the second occasion on which Senator Baxter has made this statement and the second occasion on which I find it necessary to point out to him what really did happen. Senator Baxter, of course, knows the facts, but he is attempting to circumvent what really happened. The decision was taken to relieve county councils of turf production and this work was being handed over to Bord na Móna who recruited staffs and trained them and were ready to go ahead with the work until this Order was made by the Minister for Industry and Commerce cancelling all their arrangements.
Mr. Baxter Mr. Baxter
Mr. Baxter: Well, what happened in my county was that turf production was stopped by the ex-Minister for Local Government and none of the bogs in my county had been taken over for turf development before. Probably you will find the same conditions in other counties too. Surely Senator Hawkins is not going to suggest that, because certain works were stopped by Galway County Council, people ceased producing turf. If they did, it was due to the propaganda carried on by Fianna Fáil. Senator Mrs. Concannon made a statement with regard to a letter which she had received in which it was pointed out that turf in Galway was going to be very scarce and very dear, that turf would not be  available for purchase, and, at the same time, according to Senator Hawkins, men are walking about unable to find anything to do.
If that be the situation in County Galway, the people who have been shouting from platforms all over the country about the unemployment being caused because of the attitude of this Government to turf development will have to carry a large share of the responsibility. If fuel and turf be scarce in these counties, where there are bogs and idle hands, it is these people who put into their heads that there would not be any sale for turf which will have brought about that situation. I want to say that to Senator Hawkins and to those who think with him because it is really time that we faced up to the piffle which is being talked about turf production.
I have stated unequivocally in this House in the past, and I repeat now, that we should exploit to the full the bogs we have and I would say that no matter what Government was in power. There is a raw material there; there are hands there; and there is a sale for this product in a great many counties. It was there before the Turf Development Board was brought into existence. If we look at the figures of turf production in pre-Turf Development Board days and the figures with regard to the period in which we all made a spurt in the matter of greater turf production, we find that, although we increased our total weight of turf only by something over 1,000,000 tons, we increased the value from about £4,000,000 to about £8,000,000. We were producing about 3,000,000 tons which were being sold for about £4,000,000. We added about 1,000,000 tons and the value then went up to £8,000,000. That was all that was achieved in turf production under Fianna Fáil.
Senator Hawkins, in addressing himself to the effects of Government policy on the sale of farmers' butter, made an astonishing statement. He referred to the Minister's withdrawal of the £55,000 subsidy on farmers' butter and said:—
“I have been up and down the country and I have seen farmers' wives coming into the markets and  not being able to sell their butter. In some cases they were willing to sell it at 1/8, 1/10 and 2/- a lb.”
I suggest to Senator Hawkins that he should publicise the parts of the country he travelled where this butter was for sale at 1/8, 1/10, and 2/-. I have been in towns where farmers' butter could realise 5/-, 6/- and 10/- a lb. in the market-place, and these people could not sell at 1/8 and 1/10 a lb. I challenge Senator Hawkins to give us the name of one town where farmers' wives were presenting their butter for sale and were unable to sell it. If there were one or two cases of people who could not sell, one can only make the comment that the butter must not have been very good.
Mr. Hawkins Mr. Hawkins
Mr. Hawkins: May I point out to the Senator that the amount I mentioned should have been £155,000 and not £55,000?
Mr. Baxter Mr. Baxter
Mr. Baxter: I am not speaking about the amount of the subsidy but about the Senator's statement.
Mr. Hawkins Mr. Hawkins
Mr. Hawkins: There may be, and I will not argue against it, some very small percentage of country butter which may not be up to standard, but does the Senator agree with the principle embodied in this Resolution?
Mr. Baxter Mr. Baxter
Mr. Baxter: I am dealing with the Senator's statement, a statement which I regard as sheer nonsense. There is no farmers' or creamery butter available for sale anywhere in this country, that the people are not prepared to give twice or thrice the price fixed by the Government for it. The subsidy does not matter a snap of the fingers.
Mr. Hawkins Mr. Hawkins
Mr. Hawkins: Would the Senator explain to the House the type of person who would be prepared to give these high prices?
Mr. Baxter Mr. Baxter
Mr. Baxter: There would be just as many in the ranks of the Senator's Party as in mine. The problems which are set up, when a Budget like this is presented to us, are not going to be solved by the sort of criticism we have had from Senator Hawkins. He and we will have to address our minds to the problems which face the country  in an entirely different spirit and attitude, because these days are grave, and, if last year, we spent in value of physical goods probably £100,000,000 more than we earned in the production of physical goods, it makes us realise that no Minister for Finance could continue to provide the services being provided at present, unless there is an immense increase in production.
How is that to be brought about? There was some criticism in the Dáil and outside of the Minister's policy with regard to the subsidy on wheat and I may say that I think that all that is wrong from the Fianna Fáil point of view is that this Budget was not introduced by them. I think that decision is a very clever, very equitable and very wise decision. The Minister behaves like a sensible man. He saw what his expenditure was going to be for a number of years and he divided that up and spread it out over the number of years for which the subsidy had to be carried and gave us a reduction in taxation thereby. Some of the Fianna Fáil ex-Ministers ask where the wheat will come from and where will it be available at the price, adding that, if it is not available, the policy of the Minister's colleagues will not lead to the wheat being provided within the country.
I do not know how these people want to have it, but let us examine their argument. The inference is that the Minister for Agriculture cannot find the wheat which his predecessor did not find and will not be able to find as much as his predecessor found. One thing is certain—we can commend the approach of the Minister for Agriculture in trying to find wheat to feed the people. The policy pursued during the war years of trying to grow wheat where oats could scarcely be grown has agitated the mind of every sensible farmer in every Party. Wheat was sown and the fertility was stolen out of the land and there was no crop of wheat. Had oats been sown, a crop would have been secured. The new Minister does not believe in that policy and sensible farmers never believed in it. They do not believe in it in any country, because it is bad farming. We  are to have a fixed price for wheat for five years and the great wheat-growers in Fianna Fáil never ventured so far. Theirs was a hand-to-mouth policy and farmers scarcely knew when sowing in the spring, what they would get for the wheat when it was harvested.
Some years ago, when the present Minister for Agriculture was a member of the Fine Gael Party, the then Minister for Agriculture went around the country preaching the doctrine that farmers were to grow wheat, that they had to grow wheat and that they would not get any more than the fixed price, which was then, I think, 45/- a barrel. We had a meeting of the agricultural group in our Party at which the late Deputy Hughes, Mr. Dillon, Senator Magee, Senator Bennett and I attended. We saw quite clearly that we were not going to get the wheat at the price and we decided to communicate that view as the view of our Party to the head of the Government.
Mr. Dillon—the man who is charged with being against the production of wheat and with being in favour of a policy which will lead to the starvation of the country—went to the telephone himself and asked to speak to the Taoiseach's secretary, who was at the time the ex-Minister for Agriculture, Mr. Smith. That was on Wednesday. He asked could he speak to the Taoiseach or have an appointment to speak with him. He was told he could not have it then, and Mr. Smith said he did not know whether he could have an appointment that week, but in any case he could not have it sooner than Friday. Mr. Dillon insisted that it was very urgent, and, after a great deal of discussion on the telephone, it was arranged, probably after the Taoiseach had been seen, that he would receive the deputation that evening. I had to go home and was not on the deputation. The deputation saw the Taoiseach and, as a reult, the price of wheat was raised by 5/- or more per barrel. On the radio that night we had the announcement that, as a result of the visit of the Fine Gael group to the Taoiseach, there was an agreement to raise the price of wheat by that amount. The inference from the radio announcement of the message was that the price of bread and flour  was to go up and the Fine Gael group might be blamed for that.
We are up against a situation in which wheat will be difficult to get for some time to come. There will be much more of it in the world, but there is the problem of finding dollars to buy it. That is going to be a problem for the country and it is a very wise policy for the Government to encourage the production of wheat on lands on which wheat can be satisfactorily grown. In my judgment, we will have far fewer acres under wheat in future and will get far more wheat than we have been getting. We will have farmers growing wheat at the present fixed price and fitting it into their rotation in a way in which they were not able to fit it before, because they have a policy over a number of years. In addition, we hope that we will have a larger amount of fertilisers which will encourage wheat production, as it will encourage the production of all crops.
There is no doubt that the tendency, as a result of the new trade agreement with Britain, will be to put the emphasis on the production of beef and beef cattle. Already I can see, as a consequence of the increased price, a great many of our farmers who are engaged in dairying — we might say, only partly engaged in dairying — mating their dairy cows with beef bulls, and the Minister for Agriculture and his colleagues will have to be very careful with regard to the tendency in our agricultural production, as a result of many things, but definitely as a result of the increased price for beef and the difficulty of obtaining labour in the dairying industry. The consequence of these factors may be that we will have a very unbalanced economy, so far as our live stock is concerned.
I see that the ex-Minister for Industry and Commerce is now addressing himself to the problem of dairying. He was never very concerned about it when he was in Government. Or, if he was, we could not see the results in Government policy. Those who are now on my left and who were at that time on my right can recall the number of motions I had down over the years asking the previous Government  to pay the dairy farmers a better price and they will know how short a distance we got. We had the famous speech of the ex-Minister for Agriculture, Dr. Ryan, in Cork, when he indicated that his view was that we were never going to export butter again. That mentality has presented the present Minister and his colleagues with a set-up in agriculture which is definitely very unhealthy.
Figures were produced here by Senator O'Farrell with regard to the number of live stock last year as against what we had the previous year, but if they are compared with the figures for ten or 15 years ago, they are much more disquieting. These are all the little things that make up our total production. That is the sort of picture which the Minister and his colleagues have to face up to if we are to get the maximum out of our fields. I believe we have great possibilities but we will have to appreciate them and face up to them in the proper spirit.
We all recognise that many of the economies of Europe are very badly shaken. Recently I had some contact with farmers from many European countries and I find that they are all in a rather unstable position, despite the fact that both their industrial and agricultural arms have been fully developed. We have a better chance than any of them. Certainly, our agricultural technique is behindhand and our agricultural potential has never reached anything like its maximum, so that if we have leeway to make up, we will have something in hand which other nations will not have. We will have something wherewith to build up and strengthen our economy but, to make the best use of these, we will require much more constructive thought than has been applied to the development of agriculture up to the present. The Minister should say to his colleague in agriculture that the way to increased production is the mating of all the female animals. We want more cows in calf, more sows with litters, more sheep in lamb. We require to multiply them many times if we are to get the most and the best out of agriculture and to strengthen our economy so that it will be able to bear the burden of social services and  all sorts of other development services that will be put upon it.
The criticisms that have been offered to the Budget have been, at best, ill-informed and so petty and trifling as to be hardly worthy of notice. There are naturally many flaws in our whole financial set-up. Senator Ireland has drawn attention to something to which I addressed myself on many occasions here. Senator Denis Burke has also referred to the legacy that has been passed to the Minister for Finance from his predecessor. I refer to the increase in stamp duty. As far as the sale of smaller properties is concerned, it requires revision. I intend to submit an amendment in Committee so that the matter may be considered. There are, naturally, many flaws in the whole financial structure but there are ways of strengthening our economy if we are prepared to face up to our responsibilities. We must all do whatever we can to obtain increased production. We must not pursue a line which will influence people who have been engaged in a type of production which can be consumed, to go out of production merely for the sake of carrying out political propaganda.
If turf is scarce and dear and if the poor people will have to pay more than they are able to pay this year, I assert positively that if the people in Fianna Fáil—some of them, at any rate—were acting as patriotically as they would like to pretend they are, they would have said to the people: “Those of you who can use turf and who used turf satisfactorily in rural Ireland in the years gone by, stick to your old customer and let the people producing turf continue to do so; there will be a market for it.” It would be far more effective than the other line that was pursued, trying to produce figures to see how many people were unemployed as a result of the policy adopted. That is not the way in which to strengthen our economy here. It is not the way to keep our people at home. While I sympathise with the difficulties which the Minister created for the Fianna Fáil Party in this House in making an attack on his Budget, there might have been other flaws, reference to which would have done the nation less  damage, to which they might have addressed themselves, had they opened their minds.
Mr. M. O'Dwyer Mr. M. O'Dwyer
Mr. M. O'Dwyer: Senator Baxter complains that there has been no constructive criticism of the Budget on this side of the House. I will have very much pleasure in obliging him with some constructive criticism. At a time when a new Government takes up policy, it is not the financial provisions or the taxes they impose that matter so much. These may change from year to year and have no national significance, but where the Budget is really important is in the indication it gives of the mind of the new Government. Judging by this Budget, we on this side and every Irishman interested in the future development of the country can feel only alarm.
It has been said by many speakers in this House and in the Dáil that this country is in a deplorable financial position and that but for the change of Government it was heading for catastrophe. That certainly is not the case. I claim no financial knowledge except that of the plain man in the street but, looking at it from the commonsense point of view, we must say that, comparatively, this is one of the most prosperous countries in the world. That is due first of all to the fact that this country was kept from being involved in the World War by the previous Government and, secondly, to the fact that for the past ten years we stopped paying the £5,000,000 a year which we formerly remitted to Great Britain. That has been one of the great means of maintaining prosperity. In addition, the practical cessation of imports during the war helped to place us in a strong financial position from the point of view of our assets vis-a-vis our liabilities. We are one of the best placed countries in the world. Therefore, there is no reason why we should speak of the necessity for retrenchment.
This country is in an early stage of development as a State. We know that a new country that has been misgoverned for many hundreds of years, whose population has dwindled, whose industries have been exterminated for centuries and whose land has  never been developed, above all, requires capital outlay on development. Every private business requires capital. Every shopkeeper needs capital to stock his shop. Every man who buys a farm must have capital to buy stock and to develop the land. A new country requires the employment of capital in order to develop, in order to increase its population, and to increase production. This, then, is not the time for unnecessary retrenchment for the pure sake of retrenchment.
There are some points I should like to refer to in relation to their effect on the nation and the indication they give of the general policy of the Government. Senator Baxter has raised the question of turf. I will deal with that first. Senator Baxter mentioned that the previous Government had stopped the production of hand-won turf all over the country and he mentioned County Limerick. That was not the case in County Limerick, as I would like to explain. A circular was sent to the county council by the Minister for Local Government stating that for this year Bord na Móna would take over the bogs which had been worked by the county council in previous years. It was understood that many more men would be employed during the coming year than had been employed in other years.
On this vexed question of turf production, I think there has been a great deal of misrepresentation. The policy of the previous Government was quite clear and was very sensible. We all know that hand-won turf production was an emergency industry and we recognise that, with the restoration of coal, hand-won turf production would naturally be discontinued over the greater part of the country, as it had been in the past. But, the previous Government had provided against that by arranging to have hand-won turf production changed over to machine-production. It seems to be generally agreed—I have no experience of it— that machine-won turf would be able to compete with coal as a fuel. If that were so, the common-sense thing was that the bogs should be developed by machinery and that we should save the great cost of imported fuel which, at present prices, I am sure would amount  to £7,000,000 or £8,000,000 a year. That seemed to me to have been the idea of the previous Government and any reasonable person will agree that it was a common-sense idea. Hand-won turf production would gradually change over to machine-production and, there might have been some unemployment, but there would not be unemployment to any great extent by the time the machine-production became the general practice.
There is another matter in connection with the Government's policy of retrenchment which will have very serious effects in the present situation. I refer to the reduction in the Army Estimate. The previous Government initiated the construction corps. That corps had great possibilities, from the social point of view more than from the military point of view. We all know that in towns and villages where there is not much employment, many young boys when they leave school drift idly about the streets, getting into habits of crime and generally growing up useless to themselves and the country. Those young boys that came into the construction corps could be taught trades and could be trained to be useful. That corps could be turned to most useful work in national development. There are many things requiring to be done, such as land reclamation, which would not be immediately reproductive and which could not pay a living wage. A body like the construction corps could be put to that work with great advantage. It was a great loss, therefore, to the community and a great loss to those young people that the construction corps should have been abandoned. It was well worth whatever money was expended on it and the present Government could have developed it to a greater extent now that other responsibilities are absent.
There is, I am afraid, a still more serious aspect of the reduction in the Army Estimate. We do not live in normal times. I am no lover of armies or a militarist in any sense of the word. I believe the great armies of Europe have been the curse of their countries. I do not believe in conscription or anything like that, but we must go by the times we live in. We know,  as far as human foresight can guide us, that we are on the brink of another war, although we may desire to close our eyes to that fact. The United States recently voted 1,000 million for defence. Sweden, Switzerland and other countries of Europe are rapidly building up their armies. We are old enough to have seen two great wars. We see the same atmosphere, the same building up of armies, now, as we saw before those wars.
No one can deny, unless the mercy of God intervenes, we are on the threshold of a third world war. This will be a most terrible war, a war in which Christianity and all that is civilised and good in the world will be faced with the forces of evil. This is the time when we in Ireland have chosen to disband our Army. I do not think it is fair to the Irish people to do that. We do not know how we will stand if war breaks out. We were neutral in the last war, and it may be that the Government thinks that we can be neutral in this war, but I am afraid not, because it will be too terrible and too widespread and no nation can escape.
There is the possibility that in this terrible conflict we may be called upon to put a gun into the hands of every man and to ask them to cross to Europe to stem the advance of the tide that otherwise will overwhelm Ireland as well as Europe. I think that such a thing as that is quite possible. We hope that a situation of that kind will not arise, but it is at such a moment that the Government have decided to disband the Army. I think it is not right that this most Christian country in the world should disband its Army at such an hour. I think the Government would do well to reconsider its attitude on this while there is yet time, and that they will, by every means possible, take the means to secure every weapon that can be secured before this catastrophe breaks upon the world and upon Ireland.
The Government have also decided to abandon the wheat policy. I know that there has been a guaranteed price for wheat. In the times in which we lived during the emergency—we had been living from hand to mouth—I think it would have been better if this  Government or the previous Government, had given even a larger price to secure wheat. The serious point to-day is that the Government has decided to abandon the compulsory growing of wheat. I say that they are to be blamed for putting the nation in danger. It may be that wheat had been grown compulsorily on certain lands that were too poor or on land that was too rich for wheat growing, but the previous Minister for Agriculture stated that an inquiry would be held into complaints that had been made about that.
The main thing is that a certain quota of wheat was bound to be grown in order to provide the nation with food. That quota will be grown this year but there is no guarantee that any wheat will be grown on the rich lands of the country the year after. I am afraid there will scarcely be any wheat grown. I do not think it is an exaggeration to say that there will scarcely be 200 acres of wheat grown next year in Limerick or Tipperary. The land that could grow it is already laid down in grass and will be solely devoted to cattle raising. That is a great danger, and it is one of the matters which the Government should reconsider.
I do not think anybody could say that it would be too hard on any farmer to grow wheat on 10 per cent. of his arable land. If it was not suitable it could be exempted. Certainly, the rich lands of the country are well able to grow 10 per cent. of wheat in order to secure food supplies for the nation. The Government, I think, would be well-advised not only to restore the wheat quota but to increase the price for wheat to, say, £4 for the 1949 crop. That would secure an increase in the home production of wheat. They certainly should not abandon the wheat-growing policy. Comparing the policy of the present Government with the policy of the previous Government it will be seen, no matter what may be said against the previous Government, that during all their time they watched the bread of the nation. That was the essential thing. Bread for the people cannot be put in peril for any consideration whatever.
 There is another criticism of the Government which I feel bound to make. I was simply amazed when I learned that they had decided to abandon the short-wave station. I can only describe that action of theirs as something terribly mean in view of the small cost involved and of the human sentiments which it affects. We remember that during the last war this country was isolated. We were lucky in that we were able to remain neutral, but if we had been attacked by either side we would have been gagged so far as the outside world is concerned. Our point of view would not be heard. We had no short-wave station available to us outside of Britain. If there is another war we will be in practically the same position. Is there any reason why this ancient country should not be able to make its voice heard in the outside world? What have we gained by the abandonment of the short-wave station? A few thousand pounds, I think, is all that it would amount to in the long run.
We have seen that Spain, one of the poorest countries in Europe, a country which suffered the most terrible hardships in a revolution, is to-day building one of the most powerful short-wave stations in the world. I understand it will be opened at the end of the year. By means of it Spain will be able to keep in touch with her empire in South America, and so a Christian civilised Spain will be able to speak to a Christian civilised South America. In that way, a great power in support of Christianity will be created throughout the world.
Our empire is more world-wide than that of Spain. We have our people in America, in Australia and in almost every country. We will not be able to speak to them now because this miserable thing has been thought of. Our people in New York, Chicago, and in the other great cities of America have been looking forward to the establishment of this short-wave station. If we had it they would be enabled, as they came out of the factories in a strange country, to listen-in to the messages and the music broadcast from the old country. What a joy it would be to them on a Sunday evening to listen-in to a broadcast of an all-Ireland hurling  match at Croke Park, to listen to the shouts of joy and to the clash of hurleys. What joy that would give to our exiles across the sea. What joy it would give to a poor old man and his wife living, perhaps, in a garret in New York, to listen to the songs of Connaught. They might be natives of Connemara themselves, and it might be that they would hear a neighbour's voice or hear someone playing the bagpipes or our grand old Irish tunes. It would make them feel that the world was very small, and that in their old age they had again come very near to their own country. That will not be possible now and all because of the abandonment of the short-wave station and not, mind you, by a foreigner anxious to break the connection between that country and ours, but by an Irish Minister and an Irish Government. I think it is an incredibly mean thing. The last comment that I have to pass on it is that the Government, for the sake of their good name in the future should allow the short-wave station to be built.
I can understand, of course, that the Government, having made pledges, feel that they are bound to implement them. I think that is a bad policy. I remember, that, long ago in the catechism, there was the question: “Are we bound to keep an oath to do wrong?” and the answer was: “No, as we sin in taking it and sin in keeping it.” I think the same applies to the pledges of the Government. Whatever the members of it may have said on the hustings, to-day they are the Government in control of the country and they are duty bound to do what is best for the country, irrespective of political considerations. I would ask them to abandon their policy of retrenchment. The country is too poor and too backward for such a policy. Now is the time when the country must be developed. We know that the country was coming into prominence and that it was being looked up to and respected as one of the countries of the future. But what will be thought of us now when it can be said that we have sold our aeroplanes and have decided not to build our short-wave station? It will be said that we are on the way to bankruptcy in Ireland. I do not wish to  speak bitterly on these matters, but I feel strongly on them because I can say that the members of this House have always, according to their ability, worked for the good of the country. We have been doing that for many years past. We had great hopes for the future of the country, and hence I feel that on these matters the Government have taken a retrograde step. We believe that it may have been taken in haste and because rash promises were made during the election. I would ask the Government not to do those things. I would ask them to abandon their policy of retrenchment and to recognise that the people are willing to bear the cost of the development of the country. I ask the Minister to reconsider the proposals he has made before it is too late, and to abandon his needless policy of retrenchment.
Mr. McGuire Mr. McGuire
Mr. McGuire: On the last day that the House met Senator Douglas made a very full statement from the point of view of the business and industrial community who, as far as I could judge from this debate, are not a very popular section of the people though, apparently, they are a very wealthy one. Naturally, any discussion on the Budget resolves itself into a discussion on the cost of living. What we and the Minister, I presume, would like to have and, perhaps, would expect, are some suggestions. The first point is: What are the causes of the high cost of living and, secondly, what are the remedies and the cures? First of all I think it is safe to say that the cause of high prices—that is the common way of describing the cost of living—comes under the following heads: one, the world scarcity of raw materials which resulted from the war; a second is the high cost of fuel and power; a third would be world high wages and shorter hours which naturally means a greater cost of production with a smaller amount of goods produced; a fourth, which is an extension of the last one, covers the overtime wages which have to be paid nowadays for any extra production; a fifth reason in this and in other countries would come under the heading of tariffs, and a sixth reason would be taxes and rates, and, finally, profits.
 Strangely enough, this last item on the programme is the one which seems to catch the limelight most. It is the one, in fact, which is singled out for popular exaggerated criticism. In my opinion, the cry against high prices is used, and rightly used, by workers for an increase of wages, in order to defend the high level of wages. There is no necessity for the workers to cry out hysterically about high prices in defence of their wages at any rate, as I believe that high wages have come to stay. Low prices prevailed in the world when wages were low and because wages were low—that was one of the main reasons. Now wages and prices are high, but production is low. The most important factor in the solution of the whole situation is this question of increased production. We have the example of England, where the Socialist Party, before they got into power some ten years ago, had the same cry as we hear here to-day about the high cost of living, which was attributed to excess profits, high profits and so on. But what is Sir Stafford Cripps' theme song to-day? It is “Production, more and more production.” They have no longer people taking huge profits in England, or at least the Socialist Government has had the power and has taken action in that question of profits.
Owing to erroneous thinking, it is not perceived by many people who are calling out for excessive taxation of profits that the wages of workers are as much part of the profits of industry as are dividends for shareholders and reserves. I believe there should be a new outlook on the workers' wages. Up to now, it has been regarded in the old Liberalist Capitalism tradition that wages were a cost of production, whereas it is time the conception was introduced that wages are, like dividends and like reserves, part of the products of industry. They are really profits. In other words, wages, so far from being merely costs of production are, in fact, the end of production. Therefore, with this conception, unduly to damage the profit-earning capacity of an industry is to damage its power to pay just wages. At present, many people who are influenced by the socialist doctrine and ignorant of this  fact, are agitating for increased wages and at the same time they are agitating for increased taxation of profits. With the conception of wages depending on profits, it will be realised that profits resulting from efficient and honest trading are desirable. Furthermore, they would leave the road open for a further participation by the workers in the profits of industry. The main solution is that of greater production. I suggest that Labour here should address itself to this question, as they have done already in England. Greater production will give lower prices to the consumer and will give all wages and salaries more real value.
At this stage, let me quote for you from a statement by Mr. McMullen at the recent Trade Union Congress:—
“If we are again to have a satisfactory standard of life, we must reduce the cost of commodities and play our part in securing increased production in our fields, factories and workshops.
We cannot ignore the fact that increased wages adds to production costs, and has to be passed on in the form of increased prices, unless there is sufficient profits already within the industry to meet this extra charge, or unless production is increased or the process of manufacture cheapened.”
I am not going into how these things can be achieved, but I think we would be well advised to address ourselves to these problems and to these restrictive practices of slower work, geared down to the lowest and slowest man. These are problems to which people may usefully address their minds, rather than looking for superficial solutions to high prices and the high cost of living such as quick methods of taxation and a sleight-of-hand way of dispelling these evils.
There is also the question of unjust taxation, which is seldom referred to nowadays. The fact that there are profiteers and law-breakers is no excuse for oppressive taxation. We also get, as a result of this, a petty tyranny by State officials of legitimate business. The excess profits tax had definitely reached the point of unjust taxation in many cases and that fact cannot be  disputed. The State, which is always moralising through its officials, has itself no moral right to do what is unjust, namely, to take arbitrarily the legitimate income of persons or groups of persons for general distribution amongst the community. The State, by overstepping itself in the matter of taxation or State interference in trade and industry, is attacking the very principle of private property itself.
On the purely practical side, if business is overwhelmed with unjust burdens, it will ultimately be unable to pay a just wage. Let me quote the words of a notable Catholic student of sociology, Father Coyne:—
“Strange to say, in many countries it is often the political Party supposed to represent the workers which imposes the heaviest taxes on industry, so making it impossible for it to pay a just wage.”
Labour not only seeks a just wage, but also—and quite rightly—a good share in the profits of industry. That is the task to which the trade union movement should address itself, the principle on which it is based and for which it was originally designed.
Class war and socialist ideas of State, of taxation and intervention in business, and even ownership of business, will not really further their aims. The liquidation of the private employer by taxation, compensation or confiscation—whichever you like—has not in other countries proved itself a boon to the workers, when tried there. The worker has found, instead of a human being—if a rather fallible one—as employer, that he has set up for himself a bureaucratic machine.
There is a further, a political, aspect of this question of taxing business unjustly. Many of the attacks on business enterprise to-day are unfair and they are vicious class war propaganda, which follows the same pattern all over the world. Some people are, perhaps unwittingly, taking part in this propaganda. You have only to read the papers and use your intelligence, to see that this same pattern runs through the propaganda from the very left-most sides of politics, through all the countries of the world. You get it in South  America, in Italy, in France, in England, and everywhere else. We know we have it in a milder form here in Ireland. This class warfare is a malignant disease which poisons the productive labour of man, and the human relationships between groups of the population are so adversely affected as to be poisoned.
Many attribute the high cost of living here to high profits and profiteering. That is a very simple solution for the matter and it is leftist inspired, designed to promote class jealousy, class hatred and class war. Many people who do not consider themselves in the least Left have been led to believe in this assertion. You hear it in the middle-classes and amongst professional classes, wherever you go if you happen to be one of the people associated with business.
This problem, it would seem, can be simplified down to the control, and even the seizing of profits by the State. Later on it will, no doubt, be suggested that the State should take over trade and industry itself. The ideas of those people here to-day are the same as were those of their socialist counterparts in England ten years ago, but all these attacks here are directed, as they were there, to discredit private enterprise and to the glorification of the tenets of socialism.
I noticed here the other day, after Senator Douglas had made his statement and was followed by Senator Professor O'Brien, that these two gentlemen had made what I suppose is now regarded as the old-fashioned case, in that they relied, and apparently still rely, on the old economic laws. I noticed later on in the debate that their remarks were made little of and were not taken very seriously. Apparently, you should not take these things seriously nowadays. I would remind the House and the Minister that the socialists in England also thought that the economic laws were capitalistic inventions, until they nationalised the coal industry. Then they came up against a few economic factors there that they thought could be dispelled by these socialistic  theories. They also thought that there were vast pools of accumulated wealth which the socialists had only to tap. But what has happened to them? Their “distribution of wealth” has turned out to be a sharing of shortages and the peace in industry and the harmony amongst the workers we heard so much about and which was to arrive as soon as the socialist doctrines had materialised, has turned out to be nothing but successive strikes.
It is easy and popular to fling about, wildly, charges of profiteering. Good profits can be, and have been, earned here by the efficient conduct of business. Such profit earnings are no proof that high prices have been charged in their accumulation. In fact, it is quite the reverse. I have been at business for a comparatively long time and have been brought up in a business family, but I never heard in my family or amongst any other people I met, in connection with business, that employers conspired to charge high prices. All I have heard is that success meant buying cheaply and selling cheaply, if possible. The principle was that the best net profits were made on the lowest selling price which could possibly be fixed and then doing a big turnover.
Some Senators have been sceptical as to the efficacy of price control here during the war. There may have been cases where the fixed prices were evaded, but the people in legitimate business, both manufacturing and distributing, have rigidly stuck by the price controls that were imposed. They did their best to do that, though mistakes were made at times which could not have been avoided, as will happen at any time with the human machine. The Prices Branch of the Department of Industry and Commerce has been zealous in its control of prices. It has repeatedly attacked the prices and examined the profits of firms here at all times right through the emergency. In the trade in which I myself am engaged, I have no hesitation in saying that people in England have often been amazed at the low margins of profit, lower than socialist England.
As to why some profits have been so high, there are reasons. There is  only a limited number of outstanding cases here in Dublin and those cases exist because they sell certain luxury articles which are outside the control and which it is not necessary to control. In fact, I would go so far as to say that if the luxury articles were controlled in the same way as in the case of the ordinary selling items in shops, the fixed selling price would be totally uneconomic. It is already proving so, to people who have not that luxury side to their business. The Prices Commission has done a very fair job. If excess profits are being made they are being made by people who are not doing legitimate business. A deplorable feature of the campaign about profiteering is that in the public mind all business people are maligned in that respect. I was glad to hear Senator J.T. O'Farrell excluding the better and honest type of manufacturer and trader, even though he did so in a most grudging form. The vast majority of business people are anxious and willing to do their share in dealing with culprits and with high prices where and when possible. It is a delusion, however, to think that by merely taxing profiteers, prices will come down.
I do not want to dwell on this point, but I feel that it is worth going into. It is more important now than ever before, that business should make substantially greater profits than heretofore, and for the following reasons: Firstly, to recompense shareholders; secondly, to liquidate debts, and thirdly, to aid expansion and create more employment and wealth. It is forgotten sometimes as regards shareholders, that a lot of the capital invested in most companies has been provided in pre-war pounds, some indeed in pre-1914 war pounds, whereas current earnings are in current pounds. We have been told, and everybody admits, that the current pound is not anything like worth half what it was in 1939, and, as regards the 1914 pound, it is worth only one-third.
Mr. Colgan Mr. Colgan
Mr. Colgan: Even to the workers?
Mr. McGuire Mr. McGuire
Mr. McGuire: Yes, that is the point. The workers, however, are able to take care of themselves. I am making a point for the poor  employers, but it is a very important point. By taking into account the present value of the pound it would now be necessary to double 1939 profits, and to treble 1914 profits, to give shareholders any comparable return on their investments.
Another point to be remembered is the necessity for increased profits on the past, because capital had to be used to build up stocks during the war, and to provide against a drop in prices should it come later on. That is something the traders had to provide for. Much capital has been provided by banks, and although the Revenue Commissioners, as a great concession, allow 5 per cent. to pay bank interest, it must be remembered that banks are unlike ordinary shareholders, and are not prepared to leave their money indefinitely in business.
We all know that there has been a great tightening up by banks and that they want their money back. The only way it can be paid back to the banks is out of profits. They want cash. Profits are used to develop and expand business, thereby creating wealth and employment. The same depreciated spending power of money makes it necessary to have a greater amount of it for capital expenditure. For the last time I will quote from an American paper. It reads:—
“Despite record profits dividends to stockholders—the take-home pay of the owners—have risen less than the cost of living. The man who works for wages has done far better relatively, than the man who lives on dividend payments. The lion's share of bonanza profits has gone back into new plants and equipment to increase production and make new jobs. In addition to plowing (sic) back profits many companies have had to borrow heavily to carry on their building and expansion programmes.”
That could be written about the position here. The position is exactly the same.
It is sometimes forgotten that taxation is inflationary. Many Senators called for more taxation, overlooking the fact that taxation is inflationary. Money is none the less inflationary by being Government spent than when  spent by individuals. Every penny of the enormous sum of £76,000,000, and the £10,000,000 loan, which the Minister had to find to run this State, had to be collected in the form of prices of some commodities. People who are not in business do not realise that the money which has to be got has to come from some commodities. Money left with business, even excess profits, provided it is not used in giving inflated dividends to shareholders, but is used for wise capital expenditure in the repair and upkeep of the means of production, is wealth-producing and helps deflation.
I am not arguing that industry should not be taxed. High or abnormal profits could, and should, be taxed, but the Minister should resist the urge to impose a tax like the excess profits tax, which was an excess tax on profits. Already the Minister's statements in the Dáil have caused uneasiness in business circles. Senator Douglas referred to this matter at the previous sitting. There is such an atmosphere about that many people hesitate to improve or to expand their business, because of the fear of showing increased profits, even when they are the result of the expansion of activity. If a business, by efficiency and expansion and adding to its premises and doubling the staff, made extra profits, people now are inclined to say, “Oh, such and such a firm made £5,000 profit in the past but it now makes £20,000.” Indeed the very act of expanding or improving a business is probably regarded as a sign of undesirable prosperity. I urge the Minister to continue his wise policy of avoiding wasteful Government expenditure and of reducing taxation.
Regarding the Minister's invitation to business people to help him to deal with the cost of living, and to see him, I can assure him that I am associated with many trade organisations that are only anxious to do so. I should like to point out that some delay on the part of business people in going to see the Minister was caused by the fact that when they asked to see former Ministers they found it was like asking to see God. In fact,  people could talk to God but were not allowed to talk to the Minister. Some Senators will remember that on one occasion I marched at the head of a procession in Dublin which was organised so that the Minister might be interviewed. On that occasion I saw the Minister. I ask the present Minister to continue to invite people to see him. They will gladly accept it.
Mr. Finan Mr. Finan
Mr. Finan: What about the butchers?
Mr. McGuire Mr. McGuire
Mr. McGuire: It is only reasonable that a Minister should see any body of traders that wishes to consult him. I hope the present Government will take up that attitude so that the views of any body of traders could be heard. Let us have taxation but let it be wise and just taxation. Let there be healthy respect for private property and individual liberty for each and every class. Let there be consideration for all classes and though the burden cannot be equally distributed, let it, at least, be justly distributed.
Mr. Finan Mr. Finan
Mr. Finan: There is a clear indication in the Budget that the Government is determined on a retrenchment in taxation. The ordinary citizen considers that it is time that serious consideration was given to retrenchment. When the previous Budget was introduced a gentleman who now holds office stated that taxation had reached saturation point and that it was time to do something about it. In this Budget there is an indication that something is being done and, for that reason, I welcome it. If taxation was allowed to continue soaring I am afraid many responsible citizens would abandon hope of reform. I think the action of the Minister in increasing the interest on Post Office savings is a wise one. If I am correct, the former Minister for Finance gave as a reason for reducing the rate of interest that he felt there might be an inclination to spend money. Unfortunately, there has been an orgy of spending in this country since the end of the war. When the question of soaring prices was considered in the Dáil, the only remedy suggested by the former Minister for Finance was not to buy and  that, as a result, prices would come down. As a previous Senator mentioned, prices are an important factor in regulating the cost of living. I consider that prices have now reached a point when they must come down.
To the ordinary citizen of this country who has eyes to see there is abundant evidence that profits and excessive profits were made here during the war and are still being made. Figures need not enter into this question at all because anyone who moves about this country can see for himself that there is blatant spending of excessive money, and I suggest to the Minister that if there is not an early indication of a change in this position he should reimpose the excess profits tax. I take this to mean the literal interpretation of the words, and I would not feel that it was an excess tax on profits. Now, I do agree and I do not want to be misunderstood on the point, that there are honest, decent business people in this country who have continued to make a reasonable profit on their turnover and if this turnover has increased their profits have also increased. But there are others who availed of the difficult times and shortages to take excess profits, and those are the people to whom I am referring. In the light of experience gained during the time that excess profits tax operated, it should be possible to ascertain where injustices existed. If the matter was carefully examined these injustices could be obviated in the future. I do not think that anyone, whether on the side of capital or labour, wishes to impose injustices on anyone, but where excess profits can be shown, excess profits tax should be imposed and enforced.
I want to suggest that we have in this country reasonably good social services; we have the old people provided for by way of pensions and we have the widows and orphans provided for, and others are provided for too. If the Minister has any money to spare I suggest that good use could be made, for instance, of the benefits of the excess profits tax, by providing for people who have been overlooked by every  Government. I refer to the people who have been incapacitated by accident or by God and are unable to provide for themselves. These unfortunate people are a burden on their families and do not qualify for any of the social services that exist. Recently throughout parts of the country we had outbreaks of infantile paralysis and they have left their trails in places. There is not, so far as I am aware, any means of providing for those people. We have provided for the victims of infectious disease, but I do not think any provision is made for the type I have mentioned. I suggest that they should now be provided for out of the proceeds of the reimposition of the excess profits tax. I have heard a lot about turf production. I come from an area where turf production was carried on extensively and I have no hesitation in saying that all the blah used about turf production was political exaggeration. As a man who had to employ a certain amount of labour during the year, and particularly in this spring when the turf was being cut, I had the utmost difficulty in getting labour, although I was in a turf-producing area. Certain areas were hard hit and schemes were started, but, in fact, some of these schemes had to be postponed on account of the shortage of labour.
I do not propose to speak at any great length except to say this in regard to the short-wave station. I do no know much about short-wave stations but I understand that it is contemplated in America to build sets in future on which it will not be possible to get reception from such stations. Whether that is so or not there are many things that have been said to our friends in America without a short-wave station that would have conveyed far greater benefit to the citizens of this State if left unsaid. I think if any Irishman posing as a patriot should go abroad and try to bring discredit on the members of this Government in any form he should be ashamed of himself.
Mr. Crosbie Mr. Crosbie
Mr. Crosbie: I wish to join the many members of this House who have praised this Finance Bill and this Budget and in doing so I wish to take the opportunity of answering the many  misleading and false innuendoes that have been contained in the criticism of this Bill by those on the other side of the House. When the new Government, at the behest of the Minister for Finance, took the courageous and wise step of postponing, if not actually cancelling, the inauguration of an Irish transatlantic air service the outcry from the Fianna Fáil supporters was that this Atlantic service would be a money-earning and a dollar-earning proposition. Fortunately, however, once the fear of the Fianna Fáil gestapo had been removed from the technicians and officials in the air transport business it came out quite clearly that the proposed transatlantic service could not be made a money or a dollar-earning proposition and that, in fact, the position was, as Senator Bigger pointed out, that even the large American companies who had been operating on this route for quite a number of years are making a financial loss on the route. The surprise was that Fianna Fáil there and then changed their tune and we heard a lot about the prestige that we would have gained from these services and that it would have been worth while spending more money to gain this prestige. In actual fact the reverse is true because by taking the step of cancelling these services the Minister instead of losing prestige has ensured that our prestige remains untarnished.
If we had entered into the transatlantic air services, as we have subsequently been told by experts, our prestige as an air-carrying company would have suffered and suffered very considerably. This undertaking was being started with insufficient planes. It would have been far more fitting if the late Government, instead of fixing its eyes on far-off horizons and contemplating grandiose schemes for flying the Atlantic and presumably, ultimately, the Pacific, had concentrated upon the very urgent problem of transport at home. That is a problem which this Government will have to tackle. During the war years, our internal transport suffered. It suffered from factors over some of which we had no control, but the fact nevertheless remains that reports received from  Córas Iompair Eireann, etc., show that our internal transport system is in urgent need of overhaul. Our internal transport, in spite of the fact that Córas Iompair Éireann have succeeded in losing quite an amount of money, is still over-expensive, both for the individual traveller and the trader who has to send goods by rail.
Amongst the critics of the decision with regard to the Atlantic air services was Senator Mrs. Concannon who also said that unfortunately, although we are an island people, we are not a seagoing people. I can agree with her only up to a point, and I must point out to the Senator that one of her own Party who was then a Minister made a statement on a famous occasion that this country would be able to carry on successfully “if every damn ship in the world was at the bottom of the sea.” Some months later, his colleague, the then Minister for Industry and Commerce, had to take a different view and, as a result, a mercantile fleet was started under difficult conditions. They say it is an ill wind that brings nobody any good, and certainly war is an ill wind, but on this occasion, if it did not bring us any good in any other way, it did bring about the revival of our mercantile marine service, a service which I think Senator Mrs. Concannon was incorrect in saying never existed. I think that, about 60 or 70 years ago, a great many ships were owned in this country, but over a period of years they disappeared, with the result that, at the beginning of the war, we had few and inadequate ships.
I would press on the Minister, and on the Government, that a great deal of good could be done for the country by doing everything possible to promote a further growth in our mercantile marine. I would like to see, if possible, our ships owned by private companies or individuals rather than by State sponsored companies. The little country of Norway, which has about the same population as this country, was, for many years before the war, one of the most successful mercantile carrying countries in the world. The interesting thing about the Norwegian set-up was that, in Norway, there were no very big  steamship companies and a very large percentage of the ships were often owned by one individual or company. There were quite a number of shipping companies which successfully operated only one ship.
We have been told by another Minister that it is intended to have inquiries made into the running of many of our State-sponsored companies and I hope that when this is undertaken Irish Shipping, Limited, will be one of the State-sponsored companies which will be so investigated. I thoroughly agree that there should be an Irish shipping company, but I have grave doubts whether Irish Shipping. Limited, as at present constituted and under the wing of the Civil Service, will be a sufficiently flexible body to operate in commercial competition with the steamship companies of other countries. We have heard a great deal about profits. Unfortunately, the word “profit” does not apply to most of our State-sponsored companies— there is usually a loss—but when the investigation of Irish Shipping, Limited, is undertaken, I hope that the profits made by that company will be investigated, not so much for purposes of taxation as to discover whether or not they have been put back into the company in the form of capital or ships.
In this connection, I might give the House a little incident of which I am aware and which happened during the war. A certain cargo had to come from Sweden to this country. It was carried in a Swedish ship to Lisbon. The route to Lisbon was 6,000 miles, because it was necessary for the ship to cross practically to the other side of the Atlantic, sail south and then recross to the European coast to Lisbon. The freight charged on that cargo to Lisbon by the Swedish shipping company was at the rate of £8 per ton. The cargo was then put on board an Irish ship and brought from Lisbon to Dublin, a journey of about one-quarter the distance to Lisbon. The freight charged by Irish Shipping, Limited, on that same cargo was at the rate of £28 per ton. The freights being charged by Irish Shipping, Limited, during that period were notorious and it was notorious  that their freights varied according to the customer. I trust that, when their affairs come to be investigated, that side of their business will be thoroughly investigated.
Professor Fearon Professor Fearon
Professor Fearon: Before the debate concludes, I would like to draw the Minister's attention to a disability that we are under in discussing this Bill every year, a disability which leaves us very much in the air and which may certainly give a certain amount of unreality to the deliberations, that is, the lack of information that we have regarding that very important thing, the national income. We are rather in the position of people who see the cheque book but do not see the bank book, and in the absence of a knowledge as to what our income is, it is extremely hard to arrive at a conclusion as to what is just and reasonable taxation. During the last couple of years, listening to these very important schemes which were put forward and subsequently enacted for the betterment of social welfare, mental treatment and public health, I saw the income-tax rise steadily; I saw the Budget rise every year, and I said, “What is going to happen? What is your upper limit? We got up to £65,000,000. Is that all right? We got up to £70,000,000. At what particular stage does the boiler burst?” We could get no answer. The general line taken was that these were very technical matters that have not yet been decided, but I really feel that, in order to contribute with full effect to these deliberations, we do require to have the facts clear and made available as to what our income is, to work on.
I think it fair to ask for some kind of statement as to what is the proportion of our national income that can safely be taken in taxation. In fact, I regard the whole Bill as a sort of triangle. One side is national income; one side is national taxation, and one side is national resources and national savings. I hope that by the time the Finance Bill for a very important Budget. the Budget for the year 1949, comes before us, we will be in a position to get some idea as to the amount of money we can consider with regard to our taxation.
 The second stage of the triangle is the raising of the money. I regard every person who pays income-tax as working for the State, of course, not necessarily voluntarily working, but working for the State and consequently I was very much interested in the remarks made last week regarding certain sections of the community that suffer much more from the income-tax level than others. I yet do not know what a fair income-tax level is, whether 5/- is right or whether, if the Minister decides to make it 10/-, we should still survive. But I have a feeling we are at a most unfortunate level for certain ones of us who work on fixed incomes. I hope that, as a result of hearing those cheering remarks about profits rates and profits available in the country, the Minister would consider something really drastic in exempting certain sections from a considerable amount of income-tax and the sections that might be exempted are literary earnings of the artist, the writer, the musician, for example—three types of people who have been the glory of our country in the past and who are people whose earnings are pitiful compared with people working in businesses of perhaps a more vigorous and boisterous nature.
There is the level when income-tax sterilises effort and depresses, and it can do that on both sides of the scale. You can find the man who decides it is not worth while doing a piece of literary work because payment is so small that it is really easier to do nothing, and you find the man on the other side of the scale who had his wages enormously increased in the last five years or so and who is not giving satisfactory service. We now find it takes three hefty workers—I am not sure that that is a proper name to give them—to unload a ton of coal. We find to have one's dustbin emptied in the morning requires practically a task force and a mechanical vehicle. I would not mind that if the things were done to one's entire satisfaction, but it is very often done with a considerable amount of insolence and a very bad grace and the dustbin suffers far more. I wonder if the increase in  wages on one side of the line is not having a bad effect just as much as the rise in income-tax on the other side.
Returning to the question of the writer and the musician, it seems to me an extraordinary thing that although our coinage—we have the most beautiful coinage—just as some of the ugliest stamps—carries a harp of Ireland, yet if one wanted to bring a harp into this country one would pay a very high tax for it. I most delicately suggest that some time that question of the tax on our musical instruments be considered. For a country that has had a great musical tradition, to tax instruments not being made here and that are required for the exercise of a very important, very delicate production is something I cannot understand. Musicians are usually sensitive people. They should get far more consideration than they do.
Senator Duffy spoke about the tax on greasepaint. That would come into the other problem that faces the Minister next year, that is, the taxing of the patent medicines. We made a very important step forward last year, I think, in compelling the manufacturer of the proprietary medicine to state on the label what his proprietary article contains and I imagine some people will be surprised when they see some of these labels. The question of the taxation of these proprietary medicines, I presume, will have to be handled carefully and I hope an exemption will be made for proprietary medicines, we will say, obtained under medical order but, at the present time, when you see in almost every second shop in small country towns headache tablets and various other preparations, you would really imagine that we were a nation of neurotic invalids rather than a reasonably healthy people. There is quite a large field to be explored there. It would bring in the question of actor's greasepaint because there will be a professional rebate on greasepaint, and they will be the type that will not perhaps be so used by the actors off the stage as by the actors on the stage.
The third side of the triangle is, savings. Several previous speakers have touched on this question of a savings campaign. I do not think it is anything  like enough to increase the Post Office rate to the present rate of 2½ per cent. I think we want an active drive to get savings. We want a greater inducement. I turn to the morning paper. I find two vast advertisements in the paper, one being for lipstick, offering 12 different shades, and each one essential to particular conditions. The other side of the paper offers you a variety of pens that will do everything. I will not specify the make. I do not find a single line, and I have looked through the three leading important papers, to encourage anybody to save. There is everything to encourage people to spend. I do believe a saving campaign could be profitably developed and would bring good results.
Somebody mentioned last week the danger that if people saved they would not spend. Of course, there is a happy in-between. At the present time you are inducing people to spend because you are attracting them with all sorts of most rubbishy products advertised to the utmost and there is really no alternative; there is no inducement. People say, why bother getting even 2½ per cent. if 7/- in the £ is going on income-tax? The question of diverting money to more desirable aims is, of course, something that could be developed very much more and will probably be discussed during the next part of the Bill.
Finally, with regard to entertainments, Senator Mrs. Concannon mentioned sweepstake tickets. A sweepstake is a form of entertainment. You are buying excitement—10/- worth. I should certainly put an entertainment tax on sweepstake tickets and I would certainly increase the tax on, say, the dogs. I hope I am not putting ideas into the Minister's head which will make me very unpopular with a great many people but I am only hoping that the Minister, as a result of my struggle to provide him with a little money, will turn a very keen ear to how I suggest he might spend that money. Now, I go back to the national income and say that he should use it to increase our national health and national production. I think the two are linked together. The healthy man wants to work—to a certain extent.
 This national health survey which is now being completed and will be before us soon, will be a very interesting piece of work, and I hope it will be followed up by further sums made available for medical research and things of that sort. I also hope that, when the time comes, if somebody suggests the establishment of an institute for agricultural research, to tell us some vital facts we want to know about our soil, more money will be made available for this important research.
Mr. Sweetman Mr. Sweetman
Mr. Sweetman: I welcome the Budget for the exact reason that makes it so displeasing to Senator Hawkins, Senator Mrs. Concannon and Senator O'Dwyer. I have the idea that it is a good thing to save a bit of money. The Senators opposite have reached such a lofty stage and acquired such grandiose ideas that Senator Hawkins made here the amazing statement that £300,000 is a paltry sum. I think that is fairly indicative of the stage at which they have arrived behind Party leaders who had become known throughout the world as masters of squandermania. I, therefore, am not depressed at the fact that just when we were about to take the air the present Minister pricked the balloon. Neither am I depressed at the fact that we will not be sending the voice of Éire either across the waves or through the air by aeroplane or otherwise. I agree with those Senators who have said that our real problems are those which are to be found within our own country and, I hope, within our own solving.
The subject which is dearest to my heart has not so far been mentioned, and hence I propose to make the debate on this Bill the spring-board for the bee that is in my bonnet. I refer to the provision of credit for our only productive industry. Which is agriculture. I ask the Minister to give us some indication, he being the holder of the public purse, of what his policy is towards the grave need there is for capitalising Irish agriculture. Many experts have debated and written on this subject—the extent to which Irish agriculture is now under-capitalised. Some have given the figure of £250,000,000, and others £200,000,000, but all are agreed that the industry is  under-capitalised. That is the position of an industry which, within the next few years, is going to be called upon to put forward a tremendous effort to increase its production. I suggest that to ask Irish agriculture in such circumstances to put forward a great spurt would be like asking a small motor car to do 90 miles an hour. The industry is not equipped to do the job that it has to do. It is under-equipped and under-capitalised, and, so far as stock are concerned, the numbers at the moment are probably the lowest for the last 100 years. I suggest to the Minister that the capital or credit to be made available for agriculture could be found by borrowing from the community—by asking the community as a whole to invest in the industry and keep it in a prosperous state. It is better that the money should be borrowed than be found by taxation, because money borrowed is money saved, whereas money that is taxed increases inflation and the inflationary difficulties with which the Minister has to contend.
I also wish to bring before the Minister a matter that was touched upon by Senator Duffy. I support the plea that he made to the Minister in regard to rural cinemas. I feel that the tax on cinemas in general is a fair tax, but at the same time I feel that in the case of some of our rural cinemas which seat 200 or 300 people, with one performance a night, a very good case for tax relief can be made for them. An argument which might make a better appeal to the Minister's heart is that, I think, a reduction in the taxation of the small cinemas in the small towns would probably have the effect of bringing in more revenue because, as I understand from the small cinema owners who have approached me, their overheads have increased enormously and are much the same as they are for the large cinemas. As I have already said, there is only the one performance per day in the country places. The audience is far more uncertain than in the large centres. I may point out to the Minister that a plan, such as I have outlined, has been accepted in principle in England, so that cinemas in towns with  a population under a certain figure, and with a seating accommodation for 250, have been treated very favourably in regard to the entertainment tax. I hope the Minister will be able to give some indication to the House that he is prepared to give those people some relief.
Colonel Ryan Colonel Ryan
Colonel Ryan: I think that from the point of view of the people of the country, who are the best judges of what a Budget is, this is a good one. Listening to Senator O'Dwyer, one would imagine that our only need in this country was the building up of a large modern army ready to fight some of the great powers. We were able to keep our neutrality in the past with the army that we had. The Senator was also concerned about the abandonment of the short-wave station. He thinks it was the only way of putting us on the map of the world. Of course people have different views about these things, but I do not know that there is any need to complain about what is being done. There was a good deal said about the excess profits tax. Of course the people of the country are not blind to what they see going on around them.
In every town and village there were people who had very small capital at the beginning of the emergency, in some cases hardly any. It appears extraordinary how they have developed into such big business people within a few years. Of course, the onlookers may be wrong, the banks may have given them big overdrafts to provide that business, yet it seems peculiar that those businesses have been built up within eight or ten years, or at the most 15 or 16 years. Businesses have been built up which no Government can stand over, which the mind of the people does not stand over, except where it suits them to say: “He was a great businessman; he was lucky.” In that respect I am sorry the Minister for Finance did not impose the excess profits tax and did not make those who made undue profits pay.
In regard to manufacturers, every decent man with commonsense wants to see manufacturers doing well and see exports go up and wants to help Irish industry. Every decent labouring man,  who is not a dyed-in-the-wool something else, wants to help Irish industry; but Irish industry must take an ordinary profit. If you start some small industry making wooden toys in a backroom, how can you make enough to buy a couple of big motor cars in a few years? I have heard of factories which I could not think existed, and I have looked at the places where they are supposed to be, and could not find any sign of them. But in Tramore, you turned up the bottom of a wooden horse, to find the name of the factory stamped on it. The extraordinary thing is that the people whose name was stamped on these wooden horses became millionaires in a few years, although there was no sign of the industry. I hope the Minister will stop that and see that we have decent and honest industry.
Everyone with commonsense is glad that the Estimates for the army are reduced. We want the army to keep maintenance parties and maintain the recruits, but we cannot build up an army to fight the power of Germany or England. One would imagine from what Senator O'Dwyer said that but for the army and the L.D.F. and the Government we had, this country was ruined. There is no chance of our army stopping a war or of keeping us neutral, so the less expenditure on it the better.
Senator O'Dwyer mentioned what we saved on imports during the war. Surely the Government did not save on imports. We just could not get them. I am glad of all the things that have been done for agriculture and that compulsory wheat growing is stopped and that there will be a decent settled price for wheat next year. Where the land is suitable the people will grow wheat. It cannot be as Senator O'Dwyer says; they cannot lay down grass now, they will have to sow something in those lands. Next year, while we will not get the same acreage of wheat, we will probably get as much wheat from the ground as was got in the past few years. Besides, it was ridiculous to tell everybody they must grow wheat regardless of whether the land could grow it or not.
There has been a decline in dairying.  Our whole outlook depends on exports, and the feeling at the moment is that we will go into the easy way of living and feed cattle on the land instead of keeping dairy cows. That is because of the agreement. If we wanted to go to dairying, where are the cattle to be found? I am satisfied the present Minister for Agriculture will try to stop the slaughter of calves, but if the calves are not there, where will the cattle be found? At present you cannot get men to milk the cows. Even the farmer's sons and daughters do not want to do it. Besides, at the price of cattle, it would not pay in many districts, as the price of milk is not uniform. Therefore, they will get out of cows in the very near future. Something should be done to get a uniform price for milk, though it may cost the country a good deal. That would encourage the keeping of cows and the production of calves in all districts where there has ever been dairying. The opposite is taking place at present. They are been driven to England—which we all welcome and are delighted about, as it gives us something to look for in the next four years. Still, if we get out of cows, the whole thing will be bad.
Some arrangement should be made to obtain a uniform price for milk, as the price now is different from one creamery to another. It is satisfactory in some and unsatisfactory in others. It would be a great thing for the country if we had a uniform price, which would encourage people to keep cows. The cost of living can be brought down only by a reduction of expenditure and by retrenchment. I hope that this Government will continue its policy of retrenching as in that way the cost of living is bound to come down. Otherwise, some people must be making exorbitant profits. If that is the case, I hope the Minister will make those who are making exorbitant profits pay.
Mr. Fitzsimons Mr. Fitzsimons
Mr. Fitzsimons: Some 12 months ago the Minister's predecessor reduced to 2½ per cent. the rate of interest on money given to local authorities. The present Minister has increased the rate to 3½ per cent. I do not know how working people are going to be housed if local authorities have to pay such a rate of interest on loans.
Mr. McGilligan Mr. McGilligan
 Mr. McGilligan: The rate of interest affecting housing will not be changed. It will be changed for further development. If the rate of interest is changed the subsidy will be changed. There will be no difference as far as housing is concerned.
Mr. Fitzsimons Mr. Fitzsimons
Mr. Fitzsimons: Another section of the community is affected, those that built houses apart from local authorities. Many small farmers were glad when the Minister's predecessor reduced the rate of interest on loans for four and five-roomed houses. These people will still get a grant but they will have to pay 3½ per cent on it. That is not helpful for farmers, many of whom are living under worse conditions than workers in towns and cities. The people will have to pay the increased rate of interest while local authorities borrowing from the Local Loans Fund will not. I suggest that the Minister should reconsider the matter, so that small farmers who have to borrow money through a local authority can continue to get it at 2½ per cent. That would be a great encouragement to them to improve their homes.
Some Government will have to tackle that question as well as the housing problem in rural Ireland. As far as I am aware, no Government here in the last 25 years has done very much in that direction. Everybody knows that many farmers had not the wherewithal to build houses and that they fell back on the local authorities in order to secure loans. Formerly the rate of interest was 4½ per cent., it was then reduced to 2½ per cent,. but now the charge is going up again. I ask the Minister to give consideration to the question of providing money for housing purposes at 2½ per cent.
I think there is more hidden taxation in this Budget than any that has yet been introduced. Many necessaries had to be subsidised during the war. Now that they are only partially subsidised, Ministers come along and tell the people that they had effected a reduction of approximately £6,000,000 in taxation. On the other hand, there is no denying the fact that if the housewife buys oatenmeal or flakemeal, or if a farmer wishes to dispose of butter  they find the position is not the same as it was some time ago. Flakemeal or oatenmeal is now 3/- per stone dearer than it was recently, while farmers' butter is selling at 2/- per lb.
The production of fuel during the war, whether the Minister likes or not, was a great source of wealth. No matter what Government is in power an effort will have to be made to keep the bogs working. Farmers and labourers wishing to cut turf and to develop the bogs were able, with the assistance of the State and the local authorities, to create a source of wealth in every district. Local people benefited in every way from such activities. These people were also better fed and better clad, all due to work on turf development. This country never knew what natural wealth it had until the war broke out. People were then compelled to rely on turf. Very few local authorities are cutting turf this year, they are buying what they require from Bord na Móna. Those who were formerly employed on turf work by local authorities are now unemployed, and in a short time, I believe, the numbers registering at the labour exchanges will increase. I have no doubt that those who cut turf this year will be able to dispose of it. The international situation looks serious and anything may happen. Those who speculated in turf this year are wise and are prepared for the rainy day if it comes.
Another matter which vitally concerns local authorities is the recent decision regarding food vouchers by which the cost is divided between the local authorities and the State. Half the cost is to be met this year but next year the State will contribute nothing.
Mr. McGilligan Mr. McGilligan
Mr. McGilligan: The State took it on for a couple of years but a sum was provided by the local authorities.
Mr. Fitzsimons Mr. Fitzsimons
Mr. Fitzsimons: Once the State in its wisdom undertook to charge like that I do not see why it should not be continued and election promises fulfilled. If that is not done, and if the local people have to pay then, I consider that is hidden taxation.
Mr. McGilligan Mr. McGilligan
 Mr. McGilligan: How much?
Mr. Fitzsimons Mr. Fitzsimons
Mr. Fitzsimons: When all these charges are put together they make a considerable amount.
Mr. McGilligan Mr. McGilligan
Mr. McGilligan: Less than £100,000?
Mr. Fitzsimons Mr. Fitzsimons
Mr. Fitzsimons: All these items are in my opinion hidden taxation and it is in that way election promises made by the Government Party are being fulfilled. However, the people will not be so gullible when they find out that people who make such promises do not fulfil them. I believe that this is not a good Budget for this country, because of the hidden taxation that is in it. No matter what the Minister may think, the people feel that they have many grievances under the Budget. Petrol is another item for which the public have now to pay extra.
Mr. McGilligan Mr. McGilligan
Mr. McGilligan: They always had to pay and petrol was 1d. dearer than it is now for five years under Fianna Fáil.
Mr. Fitzsimons Mr. Fitzsimons
Mr. Fitzsimons: The Minister increased the price by 1d. a gallon.
Mr. McGilligan Mr. McGilligan
Mr. McGilligan: It is 1d. cheaper than it was under Fianna Fáil.
Mr. Fitzsimons Mr. Fitzsimons
Mr. Fitzsimons: People who are engaged in the catering trade are also concerned.
Business suspended at 6 p.m. and resumed at 7 p.m.
Mr. Fitzsimons Mr. Fitzsimons
Mr. Fitzsimons: When the House adjourned, I was dealing with the position in regard to sugar for caterers and hotel proprietors, in view of the fact that sugar is no longer to be subsidised for that purpose. Those in the catering business, I take it, can scarcely continue to supply meals at the former prices, because at present most things are increasing in price. Wages are increasing, which is highly desirable, to my mind because the staffs in hotels and restaurants down the country who were underpaid, are to-day coming into their own and getting a reasonable wage. Now that these hotel proprietors and caterers have to pay the full amount for sugar, the increase will probably be passed on to the consumer, and, if they are not allowed to pass it  on, these people will have a grievance. To a certain extent, these little pinpricks are a form of hidden taxation in themselves.
If some of these things I have mentioned are going to affect the consuming public, in that the increases will have to be paid by them, one will realise that, when all these are put together, the Budget may not be quite so rosy a Budget as has been suggested, as I am certain those who represent organised trade unionism will see for themselves. There will probably be demands from organised workers because the cost-of-living figure will probably rise by reason of the decision to do away with the subsidy on these things. Notwithstanding the fact that promises were made to reduce taxation, it will be found that, while these promises may have appeared possible on paper, they are not possible of fulfilment in actual fact. When all these factors are taken into consideration, the people will see that, instead of decreasing taxation, it may result in increased taxation.
The Minister has assured us that he will allow out of the Transition Development Fund so much money to the local authorities and that there will be no difference between the 2½ per cent. and the 3½ per cent. rate in regard to the erection of houses. I should like to know what will be the position with regard to money obtained for other purposes, such as sewerage and water schemes and all the other things which go to make up a proper housing scheme. I should like to know if people, when they borrow money to put in a water scheme, will get the money from the Transition Development Fund, in order to relieve the local authority in the matter of repayment? It would be no harm if we had some expression of opinion or some assurance from the Minister that it will apply to such matters as water and sewerage schemes, which go hand in hand. The local authority will probably have no grievance in the matter, if this assurance is given, but if a grant out of the Transition Development Fund for these purposes is not allowed, it will have the effect which I have pointed out. I do not know how the people will pay the  rents, because, in the case of a house which cost £300 to build pre-war, I saw a tender the other night for £1,400 odd. It will take a lot of money from the Transition Development Fund to allow that house to be let at a rent that a man in receipt of £3 a week could possibly pay. Therefore, I think the demand on the fund would be very heavy and I hope that when the Minister is dealing with that problem he will be as generous as possible. If houses that cost about £300 pre-war cost £1,200 to £1,400 now, it will be impossible for a man with £3 a week to meet the rent. I cannot see how those who represent labour or those who represent the people, such as councillors or Deputies, can ask the man in receipt of £3, £4 or £5 to meet the rent. Are they going to call on the local authority, whose rates have not been decreasing in recent years, to shoulder a heavier burden? If the State does not come to the help of the local authority, then that burden will probably fall on the local authority. In that event will the local authority say that they will meet the difference? I do think they will be rather reluctant to do so because the charge would be too great. In many councils, especially county councils, rates are from 12/- to 20/- in the £, sometimes more, and in the case of urban councils there are very few whose rates are under 20/- in the £. When water, sewerage and housing programmes are completed I visualise that the rates will be exorbitant.
The former Minister for Local Government appointed a committee to report and advise on regional water schemes. His successor abolished that committee. Why, I do not know. I do not believe that it saves the Minister for Finance very much. I do not believe the committee would cost very much. Some of the members were civil servants and most of them were Dublin people, and the cost, therefore, would be very small. Many people visualised the time, although it might be a long time, when we would have regional water schemes, instead of a pump here and there. It is a pity, for the sake of a few pounds, to abandon the idea of the former Government of  having a committee to report back to the Minister on the question of regional water schemes.
There is one other matter. The Minister's predecessor intended to provide the small sum of £25,000 to provide a stadium or grounds for the athletes of this country. It is a very small amount which the Minister thought fit to remove out of the Budget. I do not think anyone would begrudge that small sum to lay the foundation of a national stadium which we who have been associated with sports in some form or another, let it be under the G.A.A., soccer, boxing, visualised for the city. In the year 1948 we find a Minister of State deleting from the Estimates the paltry sum of £25,000. I think that is going a bit far, and I respectfully suggest that even yet the Minister should reconsider the matter. I request those who support the Minister in this House to support me in asking him to reintroduce that sum into the Budget. I was not here for the entire debate but I think the House should be unanimous in appealing to the Minister to reconsider the matter so that the sum of £25,000 at least would remain in the Estimates, so that a beginning may be made at some time in providing a national stadium in the capital of Ireland.
Senator Finan said that the former Taoiseach, Mr. de Valera, went abroad to defame the present Government quite recently. I do not believe anyone in this House believes that Eamon de Valera went abroad to defame the present Government or any other Government. It is not his form. He has not gone in for defaming anybody. I hope people do not believe that kind of thing that is thrown across this House. I wish to enter an emphatic protest.
Mr. Tunney Mr. Tunney
Mr. Tunney: I had not intended to take part in the debate, but I have been drawn by a few remarks that were made by the previous speaker. I am sure the Minister has heard sufficient to enable him to come to a decision.
Senator Fitzsimons said that the present Government and Minister were  making an effort to fulfil their election promises to the people by reducing taxation. I welcome that statement from a member of the Fianna Fáil Party and will be glad to see it on the records of the House. The Fianna Fáil Party, before they got into power, promised that they would reduce taxation from its then figure of £23,000,000, but we know how they fulfilled their promises. Four and five million pounds were only paltry sums to them to pay for air and tourist development. Senator Fitzsimons, I am afraid, reads the Irish Press too much. His statement here was too one-sided and was not true. He said that farmers' butter was being sold in the country at 2/- per lb.
Mr. Fitzsimons Mr. Fitzsimons
Mr. Fitzsimons: I have seen it.
Mr. Tunney Mr. Tunney
Mr. Tunney: It is peculiar that some people living some miles below Navan are getting 3/3 per pound for their butter. If the Senator's statement is published in the Press, and if good-quality farmers' butter can be got for 2/- per lb, I am sure he will get plenty of letters from people anxious to buy it. When Senators make statements in this House they should realise their seriousness. I think no Senator and no person inside or outside this House will believe the statement that farmers' butter is being sold at 2/- per lb., or that the present Government were responsible for that. I would be glad to see butter on offer at the lowest possible price, so that every section of the community would be able to get it.
The Senator also said that this Government was not giving the people food vouchers as the last Government did. God help Ireland, when the past Government had to admit that they had nothing better to offer the people than food vouchers. That, surely, was bringing the country back to the conditions that prevailed in 1847. What the Irish people want is a week's wages and not to be forced to emigrate. If they had work and wages there would be no need for food vouchers except for those not able to earn a living for themselves.
The Senator also referred to the question of turf. That is a matter that  the members of the Fianna Fáil Party should keep far away from. They should be cautious in their statements on it. The Fianna Fáil Party completely failed in their handling of the turf situation. I defy contradiction when I say that they committed no greater crime against the country than in the way in which they handled the turf problem. It was one of the principal reasons why they were put out of office. I hope Senator Fitzsimons was not speaking for certain sections in this city who never did an honest day's work and yet made thousands and thousands of pounds out of this turf business. The poor of this city were robbed. The Fianna Fáil Government stood by and allowed that to go on, but when some devil in Rathgar charged a ½d. extra for meal he got a month in jail. There were some people dealing with turf in this country and they should be in jail for the remainder of their lives.
An Cathaoirleach An Cathaoirleach
An Cathaoirleach: It has been a rule of debate in this House not to attack people who are not in a position to reply.
Mr. Tunney Mr. Tunney
Mr. Tunney: I am not attacking anyone, but if the cap fits anyone he can wear it. I hope that the Minister will, by this time next year, be able to give us a return of the tonnage of turf that went into the Phoenix Park, and that was paid for, and the tonnage that will come out of it; and that I will be here to get the answer. I would like to see turf produced in the country and to see the people working on it getting a fair return for their labour. I think that the production of turf should be encouraged in Connaught. It seems silly to be importing coal there while the people in that province are forced to leave to earn a living producing that coal in another country. Under the previous Government all that the private producers got was 15/-a ton for turf that was put on the roadside, but we know what the people in the city had to pay for turf.
Senator Ryan referred to the dairying industry. As one interested in agriculture I, too, feel that there is something wrong when the people who are producing milk, a most essential food for the nation, are not getting a  reasonable return for their labour. That is a sad reflection on the country. Senator Ryan said that we would soon get nobody to work in that industry. I am surprised that anybody does so at the present time. The dairy worker is not getting a living wage. He has to work 365 days in the year. He has to be back at his work twice every day, which really means 730 days in the year for him. He does not get a night's rest. The majority of the boys in that industry are in a low state of health. I think the Minister for Health should take action to see that they have not to work under slave conditions. They have to be out at 2 or 3 o'clock in the morning, and it is no wonder their health breaks down. Their wages are not half what the average wage for the country is. I ask the Minister to see that they get a living wage, one that will bear some relation to the importance of the work they are doing. If they were organised and in a trade union they would be getting £12 a week.
I think the problems relating to milk production should be reviewed by the Government. If people are going out of it, the business must not be profitable. The Minister should get his colleague, the Minister for Agriculture, to have a review of the position carried out. We have small farmers in the country producing milk—their sons and daughters who milk the cows get no payment—for the people in the cities, who are reasonably well paid, some of them £7 and £8 per week. I hope the position will be changed, as the dairy worker is most neglected. The settlement with Britain may be a very good thing, but I do not think there is anything much in it.
An Leas-Chathaoirleach An Leas-Chathaoirleach
An Leas-Chathaoirleach: We are not discussing that settlement now.
Mr. Tunney Mr. Tunney
Mr. Tunney: It has a direct touch with the farming community. If we get a big price for cattle and other things are forgotten, it will not be good for Ireland. I do not want this country to go back to grass again.
Mr. Hawkins Mr. Hawkins
Mr. Hawkins: Be careful now.
Mr. Tunney Mr. Tunney
Mr. Tunney: I am well able to look after my own interests and I stand  over anything I say. I do not stand for this country going back to grass. I stand for mixed farms all over the country. The late Paddy Hogan when Minister for Agriculture made a statement which is still good to-day:—
“One more cow and one more sow and one more acre under the plough.”
We want another acre of tillage and I do not like the idea that we should get away from tillage. I hope the Minister and his colleagues will stand for tillage. If we were to get back to grass we could give no employment to our people. Senator Orpen made a very fine statement, that the wealth of this nation is to be found in the soil of this nation. A great portion of that was exhausted in recent years. I do not agree with one statement he made, that the only way back to fertility is by fertilisers. If we could have mixed farming and stall feeding it would bring fertility again.
I cannot understand the mentality of people who say that one section must work harder to produce the real wealth, yet the farmer, the farmer's son and the farm labourer cannot come up to the standard of the other classes. A baker told me recently that he did not see why the bakers should get up at 4 o'clock in the morning and work for £6 odd, to produce bread for other tradesmen who were getting £1 a week more. That was a reasonable case. Why should the farm labourer or the farmer's son have to get up at 2 o'clock in the morning to milk the cows? The bakers complain of the hot conditions, yet the farmers' men have to work in cold and damp. When they go to buy clothing they get no reduction because they are working on the land; they have to pay in competition with people on high salaries and wages. I hope the Government will improve their conditions and bring them to the level they deserve from a native Government. I am satisfied that the Government was right in regard to the reduction of taxation. Is it not madness to say that people who have not a right weekly wage should be taxed for air services? Do they think that will benefit the people?
 I take a very serious view of tourist development. Does the Government think we are going to build the nation on the idea of a ship coming into Dún Laoghaire with 800 tourists and returning with 800 of the finest and purest of our boys and girls, going to work in a foreign country to build up that country? These people were forced to go to Britain to get employment during the last seven years, making implements of destruction, while the Fianna Fáil Government here did not give them employment for the benefit and happiness of our people. The Fianna Fáil régime saw the greatest number of people who ever left Ireland during one period. In the Fianna Fáil period it is said we were neutral during the last war, but we gave greater help to Britain than we did in the First World War. It was our people who were engaged in making instruments of destruction. That is the extent to which we were neutral. One would need to have a large amount of patience to cope with that. I believe in calling a spade a spade, and I do not believe our nation should be built on doles, food vouchers and emigrant ships, but that was what Fianna Fáil gave us.
This Government has not been in office long enough for us to see what they are going to give us, but they have at least brought down taxation by £6,000,000, and I hope they will go further. However, I hope their line of action will not mean that more people will be forced to leave this country. The urgent need of the nation now is to get all the forces of the nation together to see in what way we can hold the Irish people in Ireland.
I would ask the Fianna Fáil members in this House, and I would appeal to the Fianna Fáil ex-Ministers, to change their present line of action. Let them not forget that, when they were in the Government and the crisis came along, every section, irrespective of politics, stood solidly behind them. My sons, like everyone else, went into the L.D.F., ready to lay down their lives for this country. I would appeal to them to stand behind the Government now, as we are not out of the crisis yet. Every time Fianna Fáil  asked for help they got it, irrespective of political views. The Irish people are a fine people, if given a chance. I am sorry to say that, in the past, they have been fooled very badly by promises made to them and which no effort was made to fulfil.
In regard to housing, I see by notices in the Press every day that there will be grants of £270 odd per house. Those grants should be controlled and should not be lavished out like that without some supervision over the type of house. Some of the houses put up by so-called builders are no credit and I would be sorry to see any person put their hard-earned wages into them. I would also be sorry to see the Government giving such substantial aid towards these houses without strict supervision to see that they were well built and that there was an advance in design. I am satisfied that some of them are deserving of recognition, and I am in favour of the grant being given to private builders when there is some supervision over them. In fact, I would like the Government to be more generous to that type of people, but I ask them to be very cautious when dealing with other classes.
Seán Ó Goilidhe Seán Ó Goilidhe
Seán Ó Goilidhe: Ba mhaith liom cainnt i nGaeilge annseo, ach ní h-aon mhaitheas é nuair nach féidir leis an Aire é thuisgint.
We have a people with very short memories. Having listened to the various speakers, I could not help thinking of the position a few years ago, and of the very severe criticism of the late Government that we have heard from speakers on the opposite benches, when they talked about the growing of wheat, the production of turf and the initiation of industry. All of us who were members of this House then remember the bitter criticism of Government policy that was initiated. But what would have happened if the Fianna Fáil programme had not been in operation before the war? Before the war started Fianna Fáil had a policy for industrial development, for turf development and foresaw the necessity for tillage, the growing of wheat and the production of beet. If such steps had not been taken what  would have happened in Ireland? I think we can all agree that conditions would be rather bad. However, we got through the war.
A certain number of industries were started. These industries are still there and are providing a certain amount of employment. Despite that there is emigration, which we all deplore. We cannot overcome the lure of foreign travel or big wages offered to young people. I wonder does Senator Tunney suggest that we should have forcibly prevented people leaving this country. Surely the Senator would not ask us to compel people to remain here when the country was unable to provide employment for them. No Government, even the great English Government or the American Government, can provide employment all the time for their own people. There has been vast unemployment in America and the same thing occurred in England. No country, especially one like ours, could possibly provide work for all its people. Does anybody suggest that we should force people to remain at home in such circumstances?
It is all very well to talk about bad turf. Everybody knows that a good deal of such turf was sold during the war. People will be found in every country to take advantage of their neighbour's plight in order to make profit. Governments can try to check that. Let us look at the condition to which profiteering went on in every country during the war. It took Governments all their time trying to stop profiteering and they did not succeed in doing so. The Government here at the time introduced price control in an endeavour to check profiteering. Criticism is all right, but it should be fair.
Having heard criticism of the type that we had to-day it is only right to point cut what the last Government did when in office. How much money was saved to this country in the last 14 or 15 years as a result of halving the land annuities? I think we saved about £5,000,000 a year on that heading. That saving over the years amounted to a considerable sum.  When one considers all these things I think if we are to have criticism it should be fair. While listening to the debate it struck me that the attitude adopted was not a national one. I was in London some years after the first Great War and met members of the Imperial Conference. The first question they asked me was: “Why does not Mr. de Valera come over here?” I said to them: “Gentlemen, I will tell you the reason. All of you come from Australia, from New Zealand, from South Africa and from Canada, and represent Dominions of the British Empire, but Mr. de Valera represents a nation as old as there is in this world. That is the reason Mr. de Valera is not here.”
We should never forget that we are an older nation than the English nation. We should not forget that. However we criticise different policies, whether Fianna Fáil, Fine Gael or any other policy, we should never forget that we belong to the Irish nation. The day we do forget that we are finished.
Mr. McCrea Mr. McCrea
Mr. McCrea: I am satisfied that the Minister will distribute the millions involved in the Budget as fairly as it is humanly possible to do so. From my short time in this House I notice that Senators on the opposite benches are particularly anxious to see that the Labour Party fulfils its obligations. I can assure them that the interests we represent will be very faithfully guarded and looked after. If Fianna Fáil had been returned to office what would be the position now? I think it is time to let the people know the position and let the cat out of the bag. I am a member of a number of organisations, some of whose interests were seriously affected by the emergency. A strong deputation was appointed at one period to wait on the former Minister for Finance, but they did not see that Minister. It was not easy to see the Minister for some years. I am referring to a deputation from the Irish Coursing Club, which wished to put up what they considered to be an unanswerable case to the Minister.
They sent a very strong deputation and they put up what, to our mind, was an unanswerable case. They showed  that they had the second or third largest exports from the country in 1946, in which year over £1,000,000 worth of greyhounds were exported. They showed that they had created a market on the Continent and in America, in hard currency countries, where dollar reserves could have been built up and that very little shipping space was required. They also pointed to the undue discrimination between horse-racing and greyhound-racing, and asked for some reasons for that discrimination. They were told after some time that horse-racing was a very old form of sport, which was a very appropriate answer to give to a deputation representing an industry which had been responsible for the export of £1,000,000 of greyhounds in 1946. They were told by the head of the Department that there was to be no change, that all other interests had been consulted and that, as a matter of fact, they were budgeting for 100 per cent. increase in the 1948 Budget. Thank God they did not get the opportunity of realising it, so far as our people are concerned. It would have meant that the workman's pint would now be 1/2, his bottle of stout 1/-, his 2 ozs. of tobacco knocking at the door of 5/-, his cinema seats from 4/- to 10/-, and greyhound racing at a higher price than the Aga Khan would have to pay into the reserved enclosure at the Curragh. These are hard facts.
I want to join in the appeal to the Minister made by Senator Duffy and Senator Sweetman in connection with the smaller cinemas in the small towns. I do not know on what basis it could be operated, but it is something to think about. I am not suggesting that they should be free of tax, but I do suggest that the Minister should seriously consider putting them back to the pre-August 1937 tax. These houses, as pointed out by Senator Sweetman, run on a few nights a week and their overheads are very heavy. They cater for the lowest paid people in the country, the agricultural labourer and rural worker, whose wages are considerably less than £3 per week.
A lot has been said about the subsidy on butter. I have some business experience, something like 35 or 36 years—  and, for the past 25 years, I have been in one of the best mixed farming districts in my own county and beside one of the best mixed farming districts in Ireland. I refer to County Wexford. The people there keep a great number of cows. They rear some calves and their surplus milk is disposed of through the local trader. I can assure Senator Hawkins and the people on the opposite benches that at the moment farmers' butter is selling, according to quality, not for 1/6 or 1/8, but from 2/8 to 3/-and in some cases 3/3 per lb. That is the position so far as the farmers' salted butter in my part of the country is concerned. I should like to know, as I am sure the House would like to know, the ingredients of which the butter being sold at 1/8 per lb. is being made. I will give Senator Hawkins the names of a few very good firms in Cork and the South of Ireland who are prepared to take fresh butter at 2/- and 2/4 per lb. and pay freight on it. He will find that he will have no difficulty in disposing of butter.
Mr. Hawkins Mr. Hawkins
Mr. Hawkins: That is much less than the 2/11 at which it was being sold previous to the removal of the subsidy.
Mr. McCrea Mr. McCrea
Mr. McCrea: It is much better now because, for the first time, the Minister has put farmers' butter back on the trader's counter and shelves.
Mr. Hawkins Mr. Hawkins
Mr. Hawkins: But not on the table of the working man.
Mr. McCrea Mr. McCrea
Mr. McCrea: It is on the table of the working man. I congratulate the Minister on the Budget he has presented to the people.
Miss Pearse Miss Pearse
Miss Pearse: Senator Tunney repeated rather vehemently a couple of times his disgust with regard to the vouchers. He may not remember why these vouchers for food came into being. The Labour Party in the Dáil at the time objected to the system, thinking that it would pauperise the people, but the then Minister for Local Government explained that these most necessary foodstuffs were in short supply and that it was quite possible that the situation would become much worse, and that they would go off the market altogether during the emergency years, and the better off  people would get their supplies while the poor would be left without them. When he gave this explanation, the late Deputy Corish, God rest his soul, said he was perfectly satisfied that the Minister was doing good work because it meant that these vouchers would have to be honoured before our money would be honoured. That was the reason the project was initiated. Everything I would wish to say, if I were a proper speaker, has been said with regard to the Budget, particularly by Senator O'Dwyer. I bitterly regret the sabotage which is going on, which has been going on, and which is about to go on with a consequent enormous increase in emigration.
Mr. McGilligan Mr. McGilligan
Mr. McGilligan: Any person who has to discharge the duties of Minister for Finance and who comes into any Parliamentary assembly expecting to be received enthusiastically about a Budget or a Finance Bill would be entirely divorced from reality. I never thought I would have any enthusiastic reception here or in the Dáil in connection with finance proposals, but I want to say that, looking back on the debates which have taken place over 25 years, I have very little cause to complain. The reception which I got both in the Dáil and here has been, on the whole, a warm one. There has been something almost approaching enthusiasm, except on the part of those who, for Party reasons, feel that they must be professional objectors.
Before going into details, I want to make one further statement of a personal type. I do not want anybody to think of me, and I certainly do not present myself, as an individual with any specialised knowledge in either economics or finance. I have been a student of some of these things over the years, but it has been with what leisure I could give from other work. I am speaking in a House here where there are a number of professional economists and people with qualifications in the matter of economics and finance to which I never could pretend. I ask the House to accept me as a person with over 16 years' experience of opposition—I have also  been a member of Government for some time—and much more as a member of the Opposition than as a member of Government I got an opportunity of mixing freely with people, and I experienced in my own home life, my own home conditions, and my professional duties some of the hardships which to a greater degree fell upon people who are not so well circumstanced as I. I think that those 16 years, and particularly the last seven years, during which I was in opposition, made me more accessible to people who had grievances, and substantial grievances, and put me much more in a position to sift what they said to me and to accept the things they said, because I had experience of it myself, although not to the same degree of hardship. I come before the House, therefore, as a person who has had some experience as a human being, but not as any professional economist or professional financier.
In that view I say to this House that they should accept the financial proposals of the year with, at least, a certain amount of enthusiasm, certainly a certain amount of gratitude and, in any event, with an appreciation that there is a group now who are attentive to public opinion and particularly attentive to public opinion that has been roused by what they thought was unnecessary hardship imposed upon them.
I want to get this Finance Bill into its setting. In doing so I have to go back to the speech I made when introducing the Financial Resolutions for the year. I find myself faced, as I said in that speech, on the basis of the revenue that was coming in from the existing taxation and on the basis of the Estimates for supply services and the Central Fund services, with a gap of £8,750,000. That is understating the gap. I do not suppose anybody in this House would be found ready to go into a Parliamentary Lobby to vote against the £600,000 which is this year set down as the first step towards the alleviation of the old age pensioners and the widows and orphans and I do not suppose anybody in this House would be found to object to the giving of the  increased half ounce of tea. These two things between them cost another £1,000,000. If I am to be given the odium of having imposed the 6d. which my predecessor forecast in the income-tax, I would point out that if I deduct the results of that 6d. from the revenue as previously estimated, that would add on another £670,000. Now, there is the gap I had to meet if I include the fruits of that 6d., but if I take on the burden of doing something for old age pensioners this year as only a token of what is going to be done for them in the full year, and the expense of the increased revenue on tea, the gap was nearly £10,500,000—a few thousand pounds short of £10,500,000—and I want that figure considered when people begin to speak of either the taxation openly imposed by this Budget or, as Senator Fitzsimons professed to believe, the hidden taxation which is somewhere to be extracted from the Budget proposals.
Before going on to show what was done by myself and my colleagues in this matter, I would ask Senators to consider what would have happened if Fianna Fáil had remained the Government. They would not have remitted the taxation on beer, stout and tobacco. In that way they would have made £6,000,000. But, even having this £6,000,000, they would have had to find £2,750,000 extra because I assume they would not have made the economies I have made. They would not have sacrificed Aerlinte. They would not have adopted the various devices I have adopted. They would not have off-loaded certain costs on to caterers. Everything I have done has been criticised by Fianna Fáil so I take it they would not have done any of these things. So, they would have had the old taxation, including the tax on beer, stout and tobacco and an additional £2,750,000. Their chief spokesman tells us there were only three sources of taxation left to any Minister for Finance. They were, spirits, or liquor of certain types, tobacco and income-tax. So, had Fianna Fáil remained in power, not merely would this country be paying that £6,000,000 which I and my colleagues remitted on certain types of liquor and tobacco, but they would have had £2,750,000 of some  type of taxation extra. People who begin to criticise me for heavy taxation should boldly tell me what they would have done in the circumstances, where they would have got the £2,750,000 as well as the £6,000,000 which I remitted.
In opposition to that picture, I present with some confidence what has been done. I was faced with finding, on the new set-up I have given to this House, £10,500,000. I took the 6d. which my predecessor had forecast, which gave me £670,000. As far as the rest is concerned, it has been found possible to bridge that gap by putting on one other major tax, that is, the tax on petrol, which this year will bring in about £900,000, so that, by accepting the 6d. and the fruits of that for a year, bringing in about £670,000, and putting on one other major tax to the extent of £900,000, the two between them being little more than £1,500,000, it has, nevertheless, been found possible to get over a gap that was yawning as wide as the figure of £10,750,000 represents.
That has been done by a variety of devices. First of all, there are real economies. They amount to a very small sum. If I take what I call real economies and certain devices by way of alleviating taxation, the savings I have made this year amount to only £6,000,000. £6,000,000 on an expenditure that has to be met this year of £77,000,000 is so small that I feel almost disposed to apologise for it, but if I get a full year to work on I hope to do better next year.
In any event, it is £6,000,000 that has been saved and, as for the rest, this so-called shift of taxation, that, with all the vehemence, has been urged in this House as having increased the cost of living and everything else, what has happened is that certain costs have been off-loaded on to the hotels and caterers. Does anybody think they are not able to bear it? Catering establishments—are they amongst the poorest of the community? Then, in regard to margarine and oatmeal, margarine and oatmeal have been bid up here. You would think the whole community was depending on margarine and oatmeal. Apparently, Senators forget the fact that margarine is rationed to the point  that people only get a very small ounce ration in the week. In any event, the full effect of the increased cost, supposing it has to be borne by the community, of the margarine subsidy amounts to, on the new cost-of-living index figure which my predecessors had made out, .0005 of a point, and, as far as oatmeal is concerned, on the new cost-of-living figure, .004 of a point. The two together on the new index figure—which I do not accept—are not anything like a percentage—.0045. I take the old cost-of-living figure. The new cost-of-living figure was an attempt to show people, by the production of a new index, that the cost of living had not gone up. I do not propose to go in for that nonsense. On the old cost-of-living figure, the increase in margarine amounts to .10 and the increase in oatmeal to .33—the two together amounting to .43—less than half a point in the cost of living—and that is what is being blared around this House and Dáil Éireann as being the increased cost of living the community have to meet with the withdrawal of the subsidies.
I do hope in another year to give the House more satisfaction with regard to economies. I doubt if it will ever be possible again to do what was done this year, namely, to bridge the gap, which amounts to nearly £10,500,000, by accepting the 6d. income-tax of a predecessor and by putting on one major tax and getting taxation to the extent of £1,500,000 and then a few matters like margarine and oatmeal and offloading to catering establishments all the things that were off-loaded. I doubt if that will be possible again and, at the same time, to have alleviation in other ways.
One of the things I do feel disposed to complain of in connection with this debate and the debate in Dáil Éireann, is that the two grievances that have been most specially publicised in both Houses are grievances said to arise from (a) turf, and (b) a cancellation of the transatlantic air service. I do not get one penny saving in this year from either of those. The chance is that the cancellation of the transatlantic air service will bring savings next year.  They do not get me a penny piece this year because the previous Government had so definitely outrun the legal bar that was put upon the extent of the subsidy permitted that I had to find this year the money for their extravagance over and above what the law allowed. That took away everything that was to be saved by the abandonment of that service.
As far as turf is concerned, there are vast sums in the Estimates—over £2,000,000, when various things are added together. Whatever they be, there is not one penny alleviation given this year by anything in connection with turf, the situation being that the Park is piled so full of rapidly disintegrating and bad material that the extra cost that will be imposed on the State this year for the bad prices that will be got for that amounts to such a figure that there can be nothing that could be regarded as a saving in connection with turf. The savings will accrue next year and I hope they will accrue.
I think I should take turf as the frst point. It was made the subject of the loudest and most prolonged complaint in connection with all Budget matters. Senator Goulding made an appeal that we should all consider ourselves as belonging to the same nation. I should like him to think whether Senator Hawkins would regard me as a good national; whether he would give me credit for a bit of honesty and not just inquire into my method of activities as if I were under the sort of supervision Senator Hawkins in his political capacity wanted put on his opponents.
Let us be honest about turf. The ex-Minister for Industry and Commerce was quite honest about it in Dáil Éireann. I know now because I am behind the curtain and have access to all the information. A committee of the Government was established as early as 1946 to consider what was going to be done at no far distant date when this grand turf scheme would have to be collapsed. Probably deriving his information from what that Cabinet committee had gathered, the then Minister for Industry and Commerce came into Dáil Éireann and disclosed what he called a declining  business in turf. He put the picture pretty clearly. He said that the turf problem had to be considered from four different angles. There was first the turf always cut by people for their own purposes—to burn in their own homesteads. He said that had gone on for a long time and he hoped that it would continue to go on. There was no reason why it should not go on. The second thing was the increased cutting of turf for what was called the national pool—the hand-won turf—and to that was added in later years a certain amount of firewood taken from some of the State forests and elsewhere and dumped in the Park and in the other 16 or 17 dumps throughout the country. Thirdly, there was the scheme that was then being thought out for the getting of machine-won turf through Bord na Móna, and, fourthly, coal. The then Minister's whole presentation of all that to the Dáil was that the winning of turf by hand, a process then being done by the county councils, was going to disappear. The only question was the date.
As regards the winning of turf by people for themselves, a thing that had gone on for years and was traditional in the country, the ex-Minister saw no reason why that should not go on. I do not see any reason why it should not go on either. But the turf that was being won by hand process for the national pool, that was going to come to an end, and what was going to bring it to an end, either late or soon, was the question of imports of coal. If coal importation reached anything like the figures that were reached in the olden days, then the hand-won turf was going to disappear. The Minister explained that. I quoted him when speaking on the General Resolution in Dáil Éireann on the 25th May. I referred to all these quotations in the concluding speech which I then made. He said:—
“that hand-won turf provides the basic fuel over large areas of the country and in some districts no other fuel can offer even a partial alternative,”
“production by persons resident in  those areas, for their own use or for local consumption, averaged about 3,500,000 tons per year.”
He also said this, and suggested that it was a reasonable statement:—
“It is to be assumed that those people will continue to provide their own requirements by their own efforts in the future.”
Coming to the hand-won turf, he spoke about the optimistic views of certain people as to how soon the emergency would be over, and said
“that the machine-won turf produced under the auspices of the Turf Development Board will merely replace the hand-won quantities now being produced by the county councils and by the Turf Development Board, as agents for the Government.”
Later, he referred to coal and exhorted people to believe then that we must get in a particular year
“the same production of hand-won turf as we got last year because there is no likelihood that we will be able to get any more coal or even able to dispense with fuel rationing in the eastern area next year.”
The balance was there. It is a balance that we must all accept. I accept it from my political opponent. Let us cut out the production of turf by people who have their own turf banks, who have always cut turf for themselves and who, we hope, will always continue to burn turf. If we do that, the only problem really is how far the turf workers employed by the county councils should be displaced, and by what are they going to be displaced—either by machine-won turf under the auspices of Bord na Móna or by the importation of coal? Let me tell the House what that Minister told us as to what had happened in the early part of this year. He told us on the 18th February that there were a number of problems which he was leaving to his successor. He said:—
“Most of them are problems resulting from the fact that efforts to accumulate stocks have been rather more successful than otherwise.”
 He said:—
“We have on hands a very large stock of American coal. At the present rate of disbursement there will still be large stocks on hands next winter. There is about a ten years' supply of firewood at the present rate of usage. A similar situation exists in relation to turf. It is true that turf is still rationed, but it is rationed solely because of the subsidy arrangement.”
Having given various details about turf, that it was still being rationed, he said:—
“There is, however, in the dumps of Fuel Importers, Limited, enough turf at the present rate of distribution to last until the winter of 1949.”
That was the picture which the ex-Minister for Industry and Commerce presented to us on the 18th February: a ten years' supply of firewood, about 500,000 tons of American coal, and enough turf to last until the winter of 1949. Referring to the hauling of turf and of firewood into Dublin, he said:—
“This business must stop if for no other reason than the physical difficulty of finding further storage space for timber. All the storage space rented by Fuel Importers, Limited, is full. If this hauling of firewood must cease, then these men have no other haulage business in which they can legitimately engage. It may be that a suggestion will be put forward to amend the Transport Act so as to give them the right to engage in public haulage of other kinds.”
And, later, he said:—
“There is, therefore, no easy solution of the problem to which I have referred.”
When we came into office on the 19th February we found 500,000 tons of American coal in the Park. There was a certain amount of South African coal which arrived later. We also found a ten years' supply of firewood and enough turf to last until the winter of 1949. There was the physical difficulty that all the dumps Fuel Importers, Limited, had were full. These do not include the 17 other dumps throughout the country, all of which were also full.  At that time timber was pouring into the city at the rate of 10,000 tons a week, costing £40,000 a week subsidy. We stopped that, naturally. There was a growl at once that certain hauliers were being displaced. Could I pretend to be sane if I continued to bring into this city 10,000 tons of some sort of fuel per week costing a subsidy of £40,000 a week at a time when we had in the dumps all the coal that the ex-Minister referred to, the ten years' supply of firewood and enough turf to last until the winter of 1949?
Can anyone say that there was not good reason for the decision that was taken to stop that? As a matter of fact, if any criticism is to be put upon the present Government, it is that, notwithstanding all that embarrassment of wealth with regard to various types of fuel, we still gave authority to Bord na Móna to produce a couple of hundred thousand tons of turf, the disposal of which is going to be very difficult. Some of that had to be left along the roadside, and the storage of it is going to be very difficult. Probably a good deal of it will be pilfered during the year. Should I lay myself open to the criticism that we were too weak to allow that to happen? There was, of course, the background that a lot of human beings had to be brought into this business, and that it would not be right to cut them off suddenly. That human consideration did weigh so much with us that we decided to ease the situation even though it could be called a sort of financial extravagance. On the matter of employment we were told that there was going to be vast unemployment by knocking people off turf-cutting and fuel schemes in general. We considered that and decided to have schemes that would be of lasting benefit in the countryside— schemes in relation to roads, drainage and the land. As there would be a permanence about these works we thought that the local authorities should make some contribution to the cost of them. Some local authorities refused to make any contribution, but we will probably give the money for them, whether the local authorities contribute or not.
Our difficulty is to find where are  these unemployed people. In certain counties where we started work we asked the people to sign the registers and to indicate that they were ex-turf workers. The position is that in certain counties we have not got people to avail of the schemes. The offer is still there. These are works on which we had hoped to engage any people who had been suddenly thrown out of employment. If my opponents want to make any point about that let them go and pack the exchanges; let them say that I am boasting that we cannot find people who are out of employment through the failure of these schemes and encourage their supporters to go and sign on. We will test them. If they want work, they will get the work. We will provide the employment for them, and if it costs money I will provide the money. I have already engaged myself to do that.
I ask Senators not to forget in all this the famous minute produced in Dáil Éireann of the conference which the ex-Minister for Industry and Commerce held on the 12th February of this year. At that conference the point was raised whether provision should be made for hand-won turf production in 1948. There is this little commentary prior to the decision being recorded:—
“If the Bord na Móna hand-won turf scheme at Kildare were not proceeded with no unemployment would result, as the workers would be absorbed in a machine-won scheme or other scheme. It was not known, however, what the effects of a cessation of hand-won turf production by the county councils would be.”
Remember the date. It was six days before a decision about the change of Government had to take place. The decision was:—
“No provision should be made in the 1948-49 Estimates for the Bord na Móna hand-won turf scheme. The question of the discontinuance of hand-won turf production by the county councils should be further examined.”
I have suggested that that was putting it a little bit on the long finger—not a very long finger but one that would just stretch beyond the 18th February. That was clearly evident in the decision.  That coming from the Minister who previously disclosed his mind in Dáil Éireann about the shutting down of these schemes indicates quite clearly to me that he thought the time had come but he was not going to take the decision until the critical date of the 18th February had passed. In aid of my interpretation of the minute, I call attention to the next item at this Departmental conference. It dealt with the “Grant of hauliers' licences to persons engaged in the transport of turf during the emergency,” and I present it in relation to the Minister's action regarding the curtailment of turf production.
“With the curtailment in turf production and haulage expected with the resumption of coal imports, it was expected that persons engaged in the transport of turf would be approaching the Department for hauliers' licences. The matter would, it was expected, be required to be fully examined in the light of policy regarding the grant of hauliers' licences. It was suggested that petrol allocations should not be made to newcomers for the present.”
The decision taken was that there should be a comprehensive review of the situation—in other words, there was another postponement of a decision.
Note the terms the Department put up to their chief, that with the curtailment of turf production and haulage expected with the resumption of coal imports, hauliers would be displaced and would be looking for licences. Is it not quite clear—do I argue in a very prejudiced way from a Party angle— when I say that these minutes and that declaration made by the Minister for Industry and Commerce indicate that he knew these turf schemes would have to be discontinued this year and he was making preparation for that?
Coal is brought into this picture. Do not forget that in the early part of 1947 there was a bit of panic with regard to coal, and people were sent abroad. A deputation left this country—the present Deputy Sheehan of the Dáil and a couple of others were sent across to America. I remember when the news was flashed through the newspapers  that they had been successful in their quest for coal and had got this 500,000 tons and 60 Liberty ships were chartered to bring the coal in. In addition to that, application was made to the British to give coal—we were getting rather poor quality at the time, and not much of it—and they guaranteed another 1,000,000 tons. As a result, when the first day of 1948 dawned, this country was in the position that it was going to have, in the year 1948, 1,600,000 tons of British coal. Our old importation used to be about 2,500,000 tons, and we were to get now three-fifths of that old-time coal import. That was done by the individual who in the Dáil told us that the necessary production of turf would vary with the situation in regard to coal importations. He gets all that coal, and every 50,000 tons of it must have meant in his mind the closing down and shutting off of so much turf production and the unemployment of so many turf workers.
We have taken this in its natural course. We believe the Minister acted properly in doing what he did, even in getting into the Park this vast accumulation of stuff, as he was faced with a particularly bad situation in part of 1947. However, no more than ourselves, he could not have taken any other decision than that to suspend the winning of turf by the hand process through county councils and their workers. I make no apology for having done what I did. The only apology I make is in representing myself as following what a Fianna Fáil Minister was likely to do.
Senator Hawkins is the only one who raised this question of the Widows' and Orphans' Fund. It has been said in the Dáil that I had looted the Fund. I think it was suggested that I made that Fund liquidate certain investments it had and that the Fund is now in a fair way to becoming insolvent. An actuarial calculation was made in regard to the Fund. The actuary reported in 1944 and said that the fund could be kept at a proper level by paying in £220,000 a year. The old rate of contribution was £450,000 and there was nothing sacrosanct about the £450,000, because the Minister for Finance, around 1945,  lifted £200,000 of it and put in £250,000. That was after the actuary reported. The actuary said that the Fund could be kept not merely quite solvent, but that all its investments could be preserved, if, during the next decade, half the old sum of £450,000, namely £220,000, were put in. He estimated that that was sufficient. I consider it sufficient, and I do not see why I should put more into the Fund than he reported was sufficient, particularly when the investments at the moment stand at £950,000 more than the figure at which they stood when the actuary reported. I am rather lucky in that respect, that my predecessor, notwithstanding the actuary's report, had, in two years, fed into the fund £450,000 a year. That is quite enough for four years, and I hope not merely to save the £450,000, but I think I have a present of £450,000 next year through his action. Whether that was due to his liberality or to his not having understood what the actuary reported, I do not know. Can anybody tell me seriously that the fund has been depleted, that there is anything tricky about the handling of the moneys going into the fund, that it is approaching insolvency or that the investments the fund is based upon will have to be sold in order to meet demands which are likely to come upon it?
The old age pensions matter was referred to by Senator Hawkins—why, I do not know. I think it was he who said that there was no increase in old age pensions in the Budget. There is not, and if he likes to make that debating point, he may, but let there be no mistake about what has happened because I regard it, from the finance angle, as a very serious decision. I set against the revenue of the State this year the sum of £600,000. This is one quarter of what would be needed in a full year to meet the new benefits to be given to old age pensioners and those on the widows' and orphans' pensions scheme. A scheme which my colleague in the Department of Social Welfare is bringing to a head will put upon the finances of the State an annual charge of not less than £2,500,000.
If people want debating points and if they want to say that there is only  a sum of £600,000 in the Budget at this point, let them wait until the autumn and see the proposals then made, and let them wait until the beginning of the year when the State will have to bear the £600,000 which is merely the forerunner of a bill over the entire year of something which cannot be less than £2,250,000 and may range a couple of hundred pounds above that figure. From a Finance Minister's angle, that was a very serious decision. My colleagues took it, and, when we began to consider in what part of this financial year any moneys would have to be paid under this scheme, it was stated to me that the examination of insurance books, the reconciliation of old and new claims, and the new calculation which will have to be made in connection with the alleviation of the means test, will take such time — as well, of course, as preparation of legislation — that there could be no hope of having legislation introduced before the Oireachtas rises in the summer and no hope of its being in the Dáil until the autumn, and no payment on foot of it until the beginning of the year.
I am budgeting this year for only one quarter of the sum which will be required. I do not know whether I am supposed to be guilty of deceiving the people in that regard, because this is only a promise. I do not think that anybody in the position I occupy would come, and certainly my colleague the Minister for Social Welfare would never let me come to the two Parliamentary Houses to put before them this sum of £600,000 unless he intended to proceed with that scheme, and I know that he is proceeding with it. Those who are doubtful may still remain doubtful, but when autumn comes their doubts will be resolved when the State will have to face that new burden.
I do not know whether it is worth while saying anything about the shortwave station. People who think it is a matter of such definite prestige will not listen to reason about it. I was affected by the remarks of Senator O'Dwyer, who talked about the poor man in the New York garret turning the knob of his radio and listening to the shortwave station here. He would be a peculiar type of poor man who  would have a set which would enable him to listen to our shortwave station, even if we got a wavelength. I do not know if there ever was anything which was going to be such an effort at national frustration as this shortwave station. Consideration was given to the problem about four or five years ago and the technical department of the Department of Posts and Telegraphs wrote very well-considered and very persuasive memoranda to the point that there was no possibility of getting a wavelength, that the wavelengths were all allocated, that attempts made earlier to get a wavelength had all failed and that attempts made to get sharing a wavelength had met with no success.
The Post Office had been putting up matters which came from their technical information side, and stating that even if we did get a wavelength, there was unlikely to be good reception in America, that there was even unlikely to be good reception if the present sets were maintained in America and that so far as they knew about the making of the new sets and what they could forecast with regard to the future, sets were not going to be improved to permit of shortwave reception. In face of all that, the solemn decision was taken to go ahead with that shortwave station and the expenditure of £200,000 on specialised machinery, although the technical information was that no wavelength was likely to be got, and, even if it was, there was not likely to be any good reception and the sets now being built in America would not allow of reception if we did get a wavelength and if reception was good. I do not know that anything more ought to be said about the shortwave station. It is a bit of a standing condemnation of Fianna Fáil so long as even the masts stick up into the air. If I were an adherent of the Fianna Fail Party, I would hope that the day would speedily come when the masts would be removed, so as not to be a cause of mirth and criticism for people who realise the exact situation in connection with that station.
Senator Hawkins, in the end, turned to the cost of living and the effect upon it of the increased tax on petrol. I  listened for days in Dáil Eireann to any number of Fianna Fáil Deputies who told me that the tax on petrol was a tax on production, and particularly on agricultural production. Every farmer apparently has gone in very much for mechanisation and almost all the mechanisation is dependent upon petrol. Where it is not dependent upon petrol, every farmer depends upon haul and haul is entirely dependent on petrol. I was told that in every way and from every angle — whether it is the poor man coming into the city on the bus or the farmer sending his produce into the city or large town, or working on the land — the tax on petrol was a tax on production and when it was not a tax on production, it was a tax on the poor man and would increase his cost of living. I cannot understand how the people who are so assured of that can look back on their past with any equanimity.
In 1941 the Fianna Fáil Minister for Finance raised the duty on petrol to 1/3 and he kept it that way for five years. It is now 1/2. It has not even got to that point. Apparently it was not a tax on production in the years between 1941 and 1946. I do not know what has happened in the country that what could be borne so lightheartedly for five years is now, as I say, one of the major sins that I have committed and it is particularly grievous because it is going to hit production or else, if it is not going to hit production, it is raising the cost of living for the poor man.
As far as the air services are concerned, and the transatlantic service in particular, because I have nothing to do with any other air service, again I have no apology for what has been done. My only regret is that I did not get any savings this year, but they will accrue to the community next year.
Those who are interested in the development of civil aviation should welcome the disappearance of the transatlantic air service. As long as the transatlantic air service was there all air services were going to be handicapped. By the clearing away of the inevitable loss on the transatlantic air service, our other air service, Aer Lingus, will get some chance to  show itself. It will be able to put itself on a businesslike footing. I hope it will. In any event it will now be able to stand by itself and to show its own accounts, and these accounts will not be confused by any repercussion from the transatlantic air service.
The transatlantic air service was going to start at a loss. I asserted here before — I have met many people since — I want to repeat my assertion — I have found nobody, no matter how enthused about aviation, who could give me even the remotest promise that in the lifetime of anybody whom I met the transatlantic air service was going to be anything near like paying its way. It was starting at a loss. It was going to continue at a loss, and the only question was then, how great would the loss be. I had to measure the admitted losses that were going to take place in the service against the prestige in connection with this. I had to weigh other things. There were arguments put up that we might bring more Americans here. I do not believe that. For those who want air transport there is no lack of it to bring people who want to come here from America.
I was told about dollar earning. I never saw it, and I never could see anybody who could make an argument on that point. It is easy to say it will be dollar earning, but you have to consider how people would pay for their fares and in what currency they would pay, and discover then what was the likelihood of our getting any dollars out of it. Even if we did, remember, the losses would swallow up anything there might be in the way of a slight advantage through dollars. If tourists come here from America and are likely to bring dollars with them, they will bring no more and no less dollars coming in our air service or coming in another service. It all depends on what currency they change their money into and where and what accounting is made of the dollars they have paid for the sterling they get coming to Éire or England, and the problem is in no way either eased or complicated by the presence or disappearance of the transatlantic service.
Senator Ó Buachalla, I understand, referred to the glass-houses for Connemara.  The comment, I understand, he made was that it was not a scheme that should be mocked at. If he has a moment to spare, I would like to let him see a file or two to let him see what members of the previous Government individually thought of the glass-house scheme. Excepting only the Minister for Finance, strangely, there was not one of them believed in it. It was a little bit of a pet subject upon which his colleagues allowed the last Minister for Finance to run riot. None of them believed in it. I think Senator Ó Buachalla would be amazed if he saw the way in which that scheme was treated behind the curtain by members of the Government when first proposed, but then, as I say, the situation appears to have developed that they said: “We had better give Aiken his head and let him fool around with glass-houses in the Gaeltacht”. It never was a scheme that was worth thinking of. If anybody now, contrary to what I say, can make an argument for that scheme, we can keep it on. So far as I have seen in any argumentation or any papers or memoranda written on it, the decision would have to go definitely against the scheme.
Senator Ó Buachalla brought in the question of the people who might under the present Government drink cheaper champagne. That was used as a bit of a sneer. Senators may not know what the situation with regard to that is and, in a sense, I am giving this point against myself because it may mean that the champagne drinkers of the country will subscribe heavily to Fianna Fáil funds in the next election. For years, Fianna Fáil let the champagne drinker away with very little taxation. Take the bottle of champagne. The duty in 1930 was 2/7. They got it at that rate in 1932 and they let the champagne drinker run along paying his 2/7 on a bottle of champagne until the year 1946. But, for 14 years, they favoured the champagne drinker in that way. They then raised it to 5/2. I am making it 6/5. In 1947, it was put up to 10/4 with the result that there was no real revenue from the tax because nobody drank the wine any longer. It is now at 6/5. That is 1/3 heavier than what Fianna Fáil raised  it to in 1946 but from 1932 to 1946 the pals of the champagne drinkers were to be found amongst the Fianna Fáil Party and they ought to get credit for that through the country. I am sorry Senator Ó Buachalla is not here but I hope my remarks will be conveyed to him.
Mr. Hearne Mr. Hearne
Mr. Hearne: Rural Ireland did not believe one word of that.
Mr. McGilligan Mr. McGilligan
Mr. McGilligan: I am sure they did not. That was the good propaganda Fianna Fáil had but these are the facts and I am sure Senator Hearne will immediately proceed to educate the rural community as to what was happening. These are the taxes as they ran. I am taking out champagne as one instance. The same thing operates with regard to all the other wines, ports and sherries. Fianna Fáil favoured the port drinker.
Mr. Seamus O'Farrell Mr. Seamus O'Farrell
Mr. Seamus O'Farrell: Is that per pint of champagne?
Mr. McGilligan Mr. McGilligan
Mr. McGilligan: No. This is a bottle. Once you come to the liquor measured in pints, we know what happens. I cannot understand Senator Ó Buachalla's view that any increase that can be given to old age pensioners will be paid for by the workers excepting that he may be there taking a subject I thought I had made my own, that was, that social services, in the end, on analysis, would be found to be paid to a great extent by the poorer sections of the community. I would say to the Senator in that connection that in a year in which remissions through various devices have been made effective to the extent of £6,000,000 a year, that is the wrong year in which to say that the new increase given to old age pensioners will in the end be paid by themselves. If we can, so to speak, find savings then the old age pensioners might get the full effect of the increase.
There were many other points made in the debate which I would like to discuss and may get a chance of discussing on the Appropriation Bill or some other time. Senator Burke, for instance, has told me that the object of a Budget ought to be to redistribute wealth. I accept that as a very  definite objective of the use of the weapon of finance at all and I think it has been done. I think it is going to be done in a different way from that which Fianna Fáil adopted. Many Senators have asked me about statistical information, particularly the type of information contained in the booklet on the national income and expenditure. That booklet cannot be brought up to date for the reason that those who are best fitted to get the material together are occupied with other matters, outside matters connected with Marshall Aid and other things, but I have promised in the Dáil, and that will accrue for the benefit of Senators, that certain information that we have, although it will not be as full as that contained in the booklet, will be got ready as soon as possible. When I came to that I saw, and I think Deputy Burke will see, that one result of Fianna Fáil operations over the years was that a great number of people were put into what was called “the submerged classes” — that you had more people below the £150 or £300 line than there used to be. The movement over the last seven or eight years, from 1937, say, on, was to put fewer people on the middle-class level and even more people below any line. Many people have asked me to attend to the middle classes. I wish I could do more for them. They are people who certainly have, I think, suffered. Most of them have no way of getting increased emoluments in order to make up the increased cost of living. They are a most valuable group in the community, and anything that could be given to them I would be in favour of, but not this year. Senator Mrs. Concannon has described this as “a standstill Budget”, and so it is not possible to do all the things that one would like to.
Senator Stanford suggested that people were losing in connection with the children's allowances. That is a calculation that it is not easy to make with precision. I understand the situation to be this: that until income-tax goes to somewhere about 7/8 there is no loss but rather a gain through children's allowances, but that when one's income-tax goes beyond a certain  point, then the balance swings in the other way. We have not reached that point yet. The Senator also urged that there should be a savings campaign. That will be started quite soon. I think some Senator asked whether we would have the groups that we used to have in the old days to do propaganda in connection with the savings certificates. I cannot say whether the savings campaign will take that form of propaganda or not. As soon as I get the Parliamentary business through I intend to institute a savings movement through the country in order to put an end to some of the spendthrift habits that have developed, and to try and prevent further inflation as a result of the increased moneys pouring through the community. I agree that thrift and providence are things that we ought to encourage.
Reference was made to the restoration of the old rate of interest on post office savings. I agree it is not much, but still it is some evidence in favour of the contention that the reduction in the interest rate did bring into people's minds the feeling that the money was not worth keeping; that they might get good value for it now, and less value later on. I am making a move in the other direction at the moment and I am making what I think is a good suggestion to the people, that if they do not spend their money now they may get better value for it in six months' time and, certainly, in a year. I will try in every way to encourage whatever system is found best suited to develop a savings campaign.
Senator Mrs. Concannon criticised me in such mild terms that I think county loyalty must have broken across Party loyalty. I accept her view that it was a standstill Budget, though there was not so much stagnation in it. I would ask the House to accept that what she says is right and that time forbade any very big change. All that could be shown was a tendency, and I hope to develop it later, a tendency which met with acclamation from those people on whom I am dependent for support. Senator Mrs. Concannon said it looked to her as if I were yielding to the cry: “Put them  out.” I think there is too much made of that. There is no doubt the time does come when people desire a change for change sake, but there is more in this than the people simply being tired of a certain Government being in office. There was a policy in the background. I found a very definite acceptance of views I was putting forward, that Fianna Fáil policy had certainly meant maladministration and a very well-developed spoils system, jobbery of a high degree.
Mr. Hearne Mr. Hearne
Mr. Hearne: That is most untrue.
Mr. McGilligan Mr. McGilligan
Mr. McGilligan: It was accepted by a Deputy in the Dáil. I can read to the Seanad, if required, the statement made by Deputy Moylan when Minister. He wrote to the father of a young girl who was looking for employment as a branch exchange clerk. The scheme he made was:—
“There will be a group of people selected.”
That would be all right, but I have the Fianna Fáil Minister saying:—
“I will select the person best suited from the political viewpoint.”
Does that mean anything else than jobbery? That statement is on record. It was made by a Minister and made by him when he was a Minister. He sat through a debate and heard that canvassed and never denied it.
Mr. Loughman Mr. Loughman
Mr. Loughman: My recollection was that he said that would be so, “other things being equal.”
Mr. McGilligan Mr. McGilligan
Mr. McGilligan: That was made a year later, when he had had time to think of it and when there was a Fianna Fáil Árd-Fheis.
Mr. Loughman Mr. Loughman
Mr. Loughman: The ex-Minister dealt with the present Minister's statement on the following day, this year.
Mr. McGilligan Mr. McGilligan
Mr. McGilligan: Deputy Moylan did not deny that the statement was made, but the Senator reminds that nearly a year later, at a Fianna Fáil Árd-Fheis, when the matter was raised, Deputy Moylan did say that his line was that “the fruits of Government policy should go to Government supporters,” and he added at the time, “all other things being equal.” I remember it well, because one of the newspapers  referred to it the next day and said, having looked at the phrase, that there must have been a record number of deadheats having regard to the allocations, because Fianna Fáil always got the plums. That statement was made. We know there was jobbery and I know it now, from my knowledge of Government Buildings; and I said it in Dáil Éireann, and the man who was criticised sat there and did not deny it. He was Parliamentary Secretary to the Minister for Industry and Commerce.
Mr. Hawkins Mr. Hawkins
Mr. Hawkins: I suggest that another inquiry be held into these allegations of corruption.
Mr. McGilligan Mr. McGilligan
Mr. McGilligan: I noticed at the Fianna Fáil Árd-Fheis that they would not go on with such a demand. There was a patronage secretary and no job could be given unless the papers had gone through the hands of that secretary, who was none other than the Parliamentary Secretary to the Minister for Industry and Commerce. That person at one time was Deputy Moylan and it was Deputy Moylan who made the other statement.
Mr. S. Hayes Mr. S. Hayes
Mr. S. Hayes: And it shocked the Minister. Fine Gael during their term of office, always did the correct thing, I suppose. They could not throw a stone.
Mr. McGilligan Mr. McGilligan
Mr. McGilligan: I could take the House through a file of appointments and ask whether Fine Gael appointed anybody, leaving better people out. That is the test. However, I as dealing with Senator Mrs. Concannon's speech. I think that Fianna Fáil lost, not because it was a question of “put them out” but because there were certain things against Fianna Fáil.
Mr. S. Hayes Mr. S. Hayes
Mr. S. Hayes: Ask Mr. Hassett or Mr. Morrissey.
Mr. McGilligan Mr. McGilligan
Mr. McGilligan: Taxation had gone up and up until the people could not bear it.
Mr. S. Hayes Mr. S. Hayes
Mr. S. Hayes: What about the district justices in Tipperary?
Mr. McGilligan Mr. McGilligan
Mr. McGilligan: I spoke about maladministration.
Mr. S. Hayes Mr. S. Hayes
Mr. S. Hayes: Look at the Dáil Debates for 1929.
Mr. McGilligan Mr. McGilligan
 Mr. McGilligan: Fianna Fáil's own Party man made the statement in the Dáil, and it argues corruption of that type.
Mr. S. Hayes Mr. S. Hayes
Mr. S. Hayes: Mr. Hassett was a Party man.
Mr. Baxter Mr. Baxter
Mr. Baxter: The Senator should have made a speech when he was in order and not be interrupting now. He should keep quiet and allow the Minister to conclude.
Mr. Hearne Mr. Hearne
Mr. Hearne: The Minister is very provocative.
Mr. Baxter Mr. Baxter
Mr. Baxter: Senator Hearne remained silent. He knew how to behave.
Mr. O'Callaghan Mr. O'Callaghan
Mr. O'Callaghan: The general principle was that the best man got the position.
Mr. McGilligan Mr. McGilligan
Mr. McGilligan: The statement was, “I selected the best person from the political viewpoint.” Does that mean the best person? Of course, I should continue and say that Miss Gilligan did not get it on that occasion. The Minister had written to the father of the girl and there was a straight tip, but she did not get it because, as the Minister wrote later, “another more urgent case had arrived.” That was what led to the trouble, because Miss Gilligan, who believed she was to get the job, gave the papers in that matter over to the Minister for Local Government, Deputy Murphy.
Mr. O'Callaghan Mr. O'Callaghan
Mr. O'Callaghan: But the best person got the job.
Mr. McGilligan Mr. McGilligan
Mr. McGilligan: That may be so from the Party point of view. I do not know who the unknown was who ousted Miss Gilligan, but she did not get in, although promised the post.
Senator Mrs. Concannon raised as did other people, the question of the £25,000 for athletics. That was a saving I was not very keen on making, but in a year in which the finances were overstrained, I felt it was no harm to do it for this year. Remember that it was only this year that it appeared in the Estimates. If all the athletic hearts throughout the country now so badly  strained had been really anxious, they would have seen that the £25,000 was voted years ago. The first time it appeared was this year — never a shilling was given before. I decided that, as it had stood from 1932 to 1948, it could stand for another year.
Mrs. Concannon Mrs. Concannon
Mrs. Concannon: That is a good hint — it is a promise.
Mr. McGilligan Mr. McGilligan
Mr. McGilligan: Does the Senator say I am making a promise? I say there will be no draw this year, but it can be looked at next year. If the situation is easier and these various subsidies are running lighter, we may have £25,000 for athletics. There was never thought to be any great assistance required for athletics. I am urged on the one hand to tax certain forms of amusement, and I could easily do that and give the £25,000, as I would make more. I cannot understand why those in athletics cannot find £25,000 for themselves. They are ordinarily well to do bodies who get good gate money and should be able to provide athletic grounds. However, if they cannot do so and make a case next year, I will see what can be done.
In regard to mineral development, where £85,000 is concerned, at first glance the saving seems to be antagonistic to development. But remember what happened. The £85,000 per annum over six years was never intended to be a fund for development. It was only exploration and the way in which it was phrased by the ex-Minister for Industry and Commerce was that “we would spend” this money. He said that very many people were optimistic, but that he did not believe much in it. I do not think I am parodying his attitude by saying he was going to spend that £85,000 over several years in order to prove that we had no minerals. It very nearly came to that —that he did not expect any mineral development from it. He said that, if we did discover there were minerals there of different types, we could decide whether we would not hold those as an iron ration against another war. Do not let anyone be misled by this £85,000. There was no question of that being used for development.
Mr. Hawkins Mr. Hawkins
 Mr. Hawkins: Nobody suggested that. It was exploration and no one suggested it was anything else.
Mr. McGilligan Mr. McGilligan
Mr. McGilligan: The Senator has not had to listen to Deputy MacEntee on this matter. Deputy MacEntee made out that there was a report in from a scientist saying there was an amazing seam of minerals in Avoca. That is not so at all. There were three reports: the first was a chilling one, the second was just a little more lukewarm, while the third said that there were possibilities. Anybody viewing the three of them and putting them into a prospectus would not have got £5 of the public's money, even for the exploration. Incidentally, the exploration at Avoca had gone on almost to the fullest point. The new situation there is that there is enough information now collected to have a decision taken, but the decision will mean that about £1,000,000, possibly £1,250,000, will have to be put into Avoca, if it is going to be developed. The public will not subscribe that and it will again be a matter for the Government. In these years, I do not think we should be asked to do that. As far as the £85,000 is concerned, whatever the geological survey and reports show, if there is any field for useful exploration we can attend to it as the years go on. I felt that this year, having come to a point that was a fairly reasonable stopping point, it would be only reasonable to stop and make that saving now. Slieveardagh has been almost wound up and I am not interfering to any extent with the money for Slieveardagh.
Senator O'Farrell mentioned transport. I would like to say, at the earliest opportunity I have of making any statement, that one of the very bad — perhaps amongst the worst — situations we have met as a result of our predecessors' handling is that which has to do with the whole field of transport. There are two main transport companies in Ireland. The condition of one of them, which has been operating more or less under terms of private management, is such as to cause no little anxiety: the situation of the other is such as to give rise to the gravest disquiet.
 Facing that bad development, my colleague in the Government, the Minister for Industry and Commerce, decided he would look for an inquiry and he made investigations to see if he could get someone to inquire into this matter of transport for him. We have been told that Sir James Milne — who, incidentally, is a Dublin-born man — would undertake an inquiry into transport conditions here. We propose to set him at work almost immediately here, and we believe he can enter on the work almost immediately. He was general manager of the Great Western Railway of England from 1929 until that railway system was nationalised and he is also the chairman of Pickfords, so he has an association both with railway and road services. I think we are lucky to get the services of such a man and I wanted to make that announcement through the Seanad to the public as quickly as possible. That being the situation, I do not propose, as the matter from my angle is more or less sub judice, to say much with regard to the numerous matters raised here in connection with Córas Iompair Éireann, its buses and its controls of different types.
Senator Seamus O'Farrell was the first of the people who came in any aggressive way at this matter of the excess corporation profits tax, and, as time is going on, I feel that I should come to that rather important matter almost immediately. I hope Senators will forgive me if I have not been able to go through all the very important points raised here. I will leave them for another occasion. Senator Seamus O'Farrell asked me to reimpose the excess corporation profits tax and he used the picturesque phrase that threatened dogs live long, and that what was required at this time was action and not threats. I have made an appeal to business people already. I asked them to aid the community by reducing prices and I asked them to use for that purpose the moneys which they had been allowed to accumulate over the years through the remission of part of the excess corporation profits tax and, since 1946, the remission of the whole of the tax. I want again to address an appeal to all those people who could very easily be brought under  the swing of that tax again to do something in connection with the lowering of prices. I think they have a duty to the community in that regard. I think they were very definitely cushioned against severe losses. I have said before in the Dáil, and I want to repeat it here, because it is a considered view of mine, that they were a favoured section of the community and, that being so, we ought to get some response from them at this time.
I spoke often in opposition about profits, profiteers and excess profits and all the rest, and possibly what I said derived from snippets of news which I got from reports of company meetings. It might not then have been regarded as being very soundly based, but surely these people to whom I addressed myself before must now realise that, however wild and whirling my words may have been then, I am now in possession of the information.
I have certain facts and figures, and when I speak for the third time — this is at least the third time, if not the fourth, that I have spoken on this very delicate matter — I ask these people to believe that I am serious in the matter and that if I have held that tax from their shoulders so far, it has not been easy to do, because the general sense of the community is against them. I am sure that they will say that my speeches in opposition helped to mislead the community, but I do not want to lead the community on any other lines at this moment. I am now speaking in a way which will be accepted as being fuller of detailed and precise information than before.
I put this matter as objectively as I can. What has been spoken of is the tax called the excess corporation profits tax. It has been described here as an excess tax. It was intended to be, and was, a tax on excess profits. What was the excess? The excess was arrived at in this way: If people made profits beyond a certain standard those profits were regarded as excess. What was the standard? The whole business community who might be subjected to this tax were given three years, the three years ending 31st August, 1939, from  which themselves to select the best year. If they had had only two years before August, 1939, they took the better of these two years. That was a considerable benefit to them. They got the best year of three not affected by war conditions. If that standard did not come up to £2,500, they got the £2,500, and if that was not good enough there was another matter which was called a substituted standard which meant that they were allowed to get revenue which would enable them to pay preference shares at whatever was the rate of the preference shares, to pay debentures or whatever interest was due and to pay 6 per cent. on ordinary capital.
Nobody can say — there may be exceptional cases of businesses which were only started, but leaving these out —that, for the generality of businesses running on their own, it was unfair to choose the best year of three years pre-war, or to have a minimum standard of £2,500 or the substituted standard. That was not an unfair standard. That related to profits and profits are looked at only after various expenses have been met. If expenses went up, there still was an overriding circumstance with regard to these profits. I have figures here with regard to them, and I think it is time the public should know them, because there are wild figures being talked about and certain meagre figures are also being tossed about from time to time. The profits assessable for this tax amounted for the six years to £37,865,000. There are certain deductions to be made from that figure which would bring the sum chargeable to excess profits for the six years to £35,246,000.
Mr. Duffy Mr. Duffy
Mr. Duffy: And that relates to companies only and not to private traders.
Mr. McGilligan Mr. McGilligan
Mr. McGilligan: I thank the Senator for reminding me. That refers to companies. Fifty per cent. of that amount, or £17,600,000, was taken. A sum of £17,623,000 did not remain in the hands of these companies, because between the ordinary corporation profits tax and income-tax, they lost another half, but it meant that they had remitted to them for the six years a sum of £8,812,000 and, in 1947, the whole tax was remitted, which meant a remission of £2,660,000. I do not pretend that  these figures are precise to the last £100,000, but the total I have here is that £11,500,000 was given back to these businesses. Why was that amount given? When the tax was first introduced, people raised the analogy of the British system. In Britain, what they did was to take the whole of any excess which was going and the question was asked why were we so soft as to take only 50 per cent., and another 25 per cent. through other taxes, and why traders generally were getting the benevolence of this 25 per cent remission.
The statement made was that it was to allow business to meet the inevitable shocks of post-war adjustment, so that for the six years they were allowed, year by year, to take these sums which amounted in the end to at least £8,750,000 to meet the inevitable shocks of post-war adjustment. In 1947, the whole tax was remitted and the reason then given for the remission, as stated by Deputy Aiken as Minister for Finance, was that it was to enable traders to reduce prices. For six years, they got a certain remission to cushion them against the post-war adjustment and in one year the whole tax was given to them amounting to over £2,500,000 to enable them to reduce prices. Surely they have something to answer for. There is £11,500,000 that they have. I was not merely sorely tempted, but was urged, before the Budget Resolutions were framed, and have been persecuted both in Dáil Éireann and here since, to reimpose that tax. I do not want to do it. First of all, it is very bad to have retrospective taxation. There is not a whole lot of money in this if we have to start over again on a new year. The only heavy revenue that would be derived from it would be if I imposed it back again to the 1st January, 1947. Retrospective taxation is evil in itself and I do not want to walk that path unless I am forced to it.
The second thing is that I would prefer to leave the trading community, such of them as are benefiting, in possession of that benefit if they will give us something in return. I think they can give us something and I want them to give it. I would far rather even err  on the side of being generous to people who have got certain profits, if it can be called generosity, and get prices down than reimpose that tax and keep prices up or even increase prices. We all want a reduction in prices and I think it is coming but I do ask business people to attend to these things. I have a mass of details but I do not intend to promulgate them to the House but, if prices are not brought down and if I have to meet traders of different types in consultation or before the public, sooner or later, an amount of information I have here will become public. It will become public. I do not think it will ease the situation of those people who have had this remission of profits given to them and I am saving them from that publicity at the moment. It will not be possible to save them from it entirely.
I look at the returns I have here when I hear a note of interrogation put in speeches as to whether profits are being made or not. I take the distributive groups of trades — the whole distribution groups. In 1937-38, in relation to a £2,000 profit and upwards there came under the eye of the Revenue Commissioners 284 concerns. Taking the new standard, the £2,000, upwards, in the year 1947-48, there were 909 concerns making these moneys. I give that as an example. I could go through the whole mass of details of the various groups, industrial groups, transport services. I do not intend to do that at the moment but I again ask traders to take it from me that I am not speaking either lightheartedly or recklessly in this matter. I suggest they owe a certain duty to the community and I think they should discharge it.
I think the complaint was made here that people ought to remember about businesses that possibly the profits they have made and the profits they have been able to put away have not been enough to preserve the business asset as it was pre-war. I do not like — I detest — I feel afraid — when I hear that plea being made, when I think of the ordinary person in this community. I take the civil servant, I take the small person employed on a small salary, I take the people who are  living on investments, I take all those who are dependent on State resources, and ask myself how many of those people found themselves running all through the years of the war with whatever little asset they had unimpaired. In some cases it was just their manual capacity, sometimes merely their health. Yet the business community at times seem to demand that it is for the community to sustain the productive asset of a business as it was.
The war tore seven years out of the lives of every one of us. It reduced our status. It prevented people in their mid-years from making the progress that they were entitled to expect they would make in that period. Certainly everybody had to compress his expenditure and at times that meant economising in such things as children's education. Sometimes, in the poor classes, it meant even economising in health. At times it meant economising in foodstuffs. The people who were forced to these economies — and very serious economies they were — have no asset they could leave to their children. People who are in business have assets productive of money to themselves while they are in ownership of them and something that they can hand on to their descendants. I do not think it is wrong that we should call upon people of that type to give something to the community at this stage even though it means that the physical assets that they have in connection with business premises or business stock may not be so good as they were, say, when the war started or even when it ended.
I think the comparison that has to be made is that type of comparison and when that comparison is made I think business people will be well advised to do what was done on the other side of the water. An appeal was made like what I have made. As far as I could see, a few weeks passed before the Federation of British Industries on the one hand and the Trade Union Council on the other hand got together and both saw whoever were the Ministers who have charge of the field of work they were  interested in. Both met and agreed, as far as the trade union people were concerned, to mitigate certain demands they were making and as far as the others were concerned, to see whether they could not pay out of accumulated profits something in the way of either an increase to workers or something to the consumer in the way of a reduction in prices. A corresponding movement should develop here.
I hope I have been objective. It was alleged against me when in opposition that I was rather envenoming against certain people. I want to give the assurance and I hope it will be accepted that there is no question of jealousy or envy or venom against people for having made money. There is nothing of that at all. I have tried here to put objectively before the House certain views I have, backed by certain figures I have.
May I balance that by saying that I think it would be a disastrous thing to reimpose excess corporation profits tax at this point? Whatever chance there is of getting prices down, I think the movement would stop, would go into reverse gear and you would probably have an increase in prices and it might be acompanied by unemployment. For that reason, I want to be allowed not to reimpose that tax as long as that is possible.
I have given prices and figures here covering only the years up to 1947. There are no precise figures yet available to me, naturally, for the year 1948 but there are indications and the indications are that business is not doing as well this year as it was last year or the years before. It may be that this downward tendency that has certainly been noticed in regard to prices is naturally having its repercussions as far as profits are concerned. I welcome that tendency towards a reduction in prices but it will have repercussions on those in business and I think it would be wrong, until we see the situation clearly at the end of another three or four months, to move in this matter.
I add to that, this. I thought I had achieved a fairly steady balance in the  phrase that I used at the end of the Budget speech with regard to the two sets of people who were involved. I spoke just at the end of the speech about wages and salaries and, with equal solemnity, I do ask to be listened to again on this. I said on May 4th:—
“The substantial wage and salary increases already secured by all classes of workers, with such further advantages as shorter hours, paid holidays, children's allowances and other increases in social services, have gone as far as is possible, in present circumstances, to meet the claims of social justice, and I would make a most earnest appeal to all employees not to seek further increases in monetary remuneration or improvements in working conditions, unless warranted in exceptional circumstances.”
I want to repeat that. I was jibed at by Fianna Fáil supporters in Dáil Éireann that I would not have said that months ago. The situation was not the same months ago. There have been very many increases in wages granted in the last two or three months and there are many more now being sought, but I do ask those who are more in touch with trade union people and employers than I can ever hope to be to put a view before those whom they represent and ask them to see if it is not a reasonable view, to see if it is not one that the workers could accept. I then went on to say:
“Recent experience confirms that the benefit of an increase in money incomes is rapidly swallowed up by rising prices.”
If demands are made in certain businesses what will happen is this: there is a certain pool out of which wages can be paid, and if a certain number dip too heavily into it the pool will be exhausted, and so many people will not be able to be paid out. There may be unemployment caused. If there is not, there is another reaction that may take place. What I have said is that demands will be met and prices will be raised. They spiral up once more so that wages are found not to be worth what they were supposed  to be, and more demands will be coming. I thought I had achieved a pretty good balance when I spoke that way to the workers. I ended up by speaking to business people, and in regard to them I said:
“I have already appealed for the co-operation of the business community in the task of bringing down prices, but so far without result.”
Here I am now in June, and I have to say again, so far without result as far as any approach to me is concerned:
“If inflationary forces are to be prevented from getting completely out of hand, there may be no alternative but to restore the machinery of control embodied in the various standstill Orders. This is not in contemplation, but if it should be forced upon us it would be accompanied this time by the appropriation of the whole, not merely a part, of any excess profits.”
I ask to have these words of mine recognised. I hope people will appreciate that I am speaking seriously in this whole matter. I am speaking seriously because there have been so many appeals made to me to reimpose this tax. I ask Senators not to ask me at this time to reimpose it. Let us give the tendency that is developing more time to develop further, and see can we not get prices down and so restore the purchasing value of money to some degree that will be better than any demands for increased wages.
Mr. S. O'Farrell Mr. S. O'Farrell
Mr. S. O'Farrell: I accept that, but seeing that the Minister's predecessor last year made an appeal without any response, and that the Minister himself made it some months ago without any response, it seemed to me that the only thing to do was to stop threatening and coaxing and to reimpose the corporation profits tax. I agree with the Minister that it would be much better if the industrialists themselves voluntarily reduced prices to the amount of, say, £1,000,000 a year than that the Minister should have to use force to extract £2,000,000 from them.
Mr. McGilligan Mr. McGilligan
Mr. McGilligan: I recognise that what I have said pivots on a remark of  the Senator's. I did not intend to criticise anything he said. I welcome his speech and I do not say I have anything in the way of a grievance against him. It may be that I pivoted my remarks too much on one remark of his. Many speakers, both here and in the Dáil, made speeches on this particular matter and that is my answer to them. I do not want to impose this tax. I think it would be very bad. There is that tendency developing, and I prefer to see how it will develop further. If that development does not come, there are other ways of dealing with this. I do not want to appear as threatening. I am appealing more to people to make a return to the community for certain favours that were given to them for a certain purpose — to enable them to cushion off against a series of adjustments in the post-war years.
Senator O'Brien spoke about witch-hunting after profits. I take his remarks to apply to normal conditions. I do not think his remarks entirely appropriate to the matter that I am discussing now. I am dealing with abnormal conditions. I want to put myself on record again as saying that I have no objection to, and that I have heard no objection either in the Dáil or Seanad to profits as such. I have heard objections to excess profits. There is no witch-hunting, as far as the Government is concerned, after profits. I accept every word that Senator O'Brien has said that these profits are the legitimate reward of good service, efficiency and enterprise. I take it, however, his remarks were intended to apply to normal conditions. I wonder when are normal conditions going to come to this country in connection with business. We have abnormal circumstances — the aftermath of the war. During normal conditions in this country before the war, we had a policy of high protection, and high protection certainly cannot be regarded as demanding either efficiency or enterprise. I have read a great deal of labour literature and socialist literature which makes the claim that everything that is added to what comes from the earth is really the fruit of labour, and that labour, therefore, is entitled to demand 100 per cent. of it.
Mr. Duffy Mr. Duffy
 Mr. Duffy: It depends on what you mean by labour.
Mr. McGilligan Mr. McGilligan
Mr. McGilligan: Generally it is the labour element in production. However, it is a widely phrased claim, and at times it is not one that can be easily accepted. In this country if we are going to continue on the terms of this sky-high protection, I think a situation is likely to develop in which people will say that there is not very much in the way of enterprise required. I am wondering how far efficiency is developed by a high protective situation? Having posed these two questions, one comes to another. It is what is the real reward for the service that is rendered to the community under a high protection system? As far as I can make out from what has developed here it is rather like this: that people here demand for what is really a gilt-edged business, one that is protected highly, the reward which is usually associated with a speculative business. I do not think they should get that. If you have a business established here under high tariff walls, I think those in it should recognise the fact that they are protected against competition. They are making their money rather easily, and they should be satisfied with 3 or 4 per cent., whereas, in a speculative enterprise, they would look for 12 or 15 per cent. or even higher. We can discuss these matters further when more normal times come, if they ever do come.
Senator Douglas posed a dilemma to me on the matter of taxed profits and prices. “I must admit,” he said, “that prices were controlled during the war,” and that, therefore, it looked as if, in looking for extra revenue from profits made, I was looking for revenue from prices that must be regarded as legitimate because the profits were derived from prices fixed by the Department. The trouble about price fixing all the time has been that I have felt for a long time that prices were fixed on the basis that enabled, if not the least efficient, certainly then nearly the least efficient, to come into production. The result was that the fairly good man made plenty of profits and the really good man made abundant profits. The difficulty that I think the price  fixers are in all the time is that they have not beside them somebody from the Revenue Department who would know what profits were being made, even under price fixing. If they had studied this price fixing properly and obtained that information, they would know that they were fixing prices on a wrong basis, to enable these very high profits to be made.
One of the first investigations I hope to make is into all subsidised articles. Immediately there will be an investigation of the bakers' and millers' prices, as they are costing a very heavy subsidy — over £9,000,000 a year — and it is necessary in the interests of the people to see that they are entitled to that money and give value for it. Then there is tea, where there is a field open for serious inquiry, to see if the subsidy is warranted. I believe considerable economies can be made there and I look forward to presenting a better financial situation next year.
To come back to the comparison, Senator Mrs. Concannon said this was a standstill Budget and there was not much time to look into things. That is perfectly right. May I remind her, for the benefit of the Party, of some of the things that had to be done in a short space of time? The first thing I had to do was to pay my predecessor's debts. I got from the people of this community, in the very early stages of being Minister for Finance, £12,000,000. I have not a shilling of that left for new development; every penny of it had to be paid to meet the debts that Fianna Fáil had left. Some of these are called capital development — I do not mind those — but a greater part of them are to meet Budget deficits. In so far as there is any part to meet capital development, I would like people to remember what I said in the Budget statement. The direct State debt at this moment is £104,000,000. The local authority net debt is nearly £26,000,000. Against the State debt of almost £105,000,000, there are assets that are regarded as being worth £48.5 millions. As I said in the Budget:—
“....a high proportion of these assets either yields no return at all in relief of the annual charge for the debt or yields an inadequate return.  We hold shares in various State-sponsored companies to a book value of £4.3 million, but last year dividends were received on less than one-third of this share-holding. Advances totalled £31.7 million but only the £16.1 million advanced to the Electricity Supply Board .... can be regarded as providing a full offset to the interest on the corresponding amount of debt created.”
Having paid off the debt, I find myself with a Civil Service that now numbers 32,000. In the year 1932, when Fianna Fáil promised considerable reductions to ease the taxpayer to the extent of £2,000,000, mainly through savings in the Civil Service, the number was 21,000. That has gone up almost by 50 per cent. and the cost has very nearly doubled. Some Senators welcome an income-tax of 7/-, but most do not. In 1932, the income-tax was 3/6. The first Fianna Fáil Budget raised it to 5/-. It was reduced eventually to 4/6, then went up again to 6/6 and then to 7/6 and it is now standing at 7/-.
Mr. Duffy Mr. Duffy
Mr. Duffy: And income-tax on property is levied on five-fourths.
Mr. McGilligan Mr. McGilligan
Mr. McGilligan: Yes, and in addition the old allowance for repairs is taken away, meaning an increase of 50 per cent. on that valuation. I was criticised in 1932 because the trade of the country was running at a visible deficit of £16,000,000. Last year, the visible trade deficit was £91,000,000.
Finally, I found myself faced this year with a deficit on the finances of the State of £8,731,000, or £10,000,000 if you take the two extra aids to the increase in the tea ration and whatever is done for the old age pensioners. I am criticised for having reduced a deficit of £8,700,000, or almost £10,000,000, to a deficit of £1,180,000, which I have made by two major taxes. Senator Mrs. Concannon is right in saying it was hard to face all that in the two months in which it had to be faced before the Budget resolutions were presented to the Dáil. It is mainly for that reason that I ask the House to commend the Budget statement and the Finance Bill based on it. The Government has been only four  months in office and it was not possible to make very radical changes. I can only thank my predecessor for it that there was so much to be done in so short a time.
 Question put and agreed to.
Committee and Final Stages ordered for Thursday, 1st July.
The Seanad adjourned at 10 p.m. to 3 p.m. on Thursday, 1st July, 1948.
Seanad Éireann 35 Finance Bill, 1948 (Certified Money Bill)—Second Stage (Resumed).