Seanad Éireann - Volume 84 - 15 July, 1976

Appropriation Bill, 1976 ( Certified Money Bill ) : Second Stage (Resumed) and Subsequent Stages.

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

Mr. Harte: Before the adjournment last night I had explained that the reason why my contribution took the shape it did was because the Minister's appeal for an objective appraisal of the difficulties we are in at present was not responded to. The emphasis seemed to lie in the direction of levelling accusations about the present performance of this Administration and holding them responsible for the events over the past 50 years or so.

In response to that I had indicated that in 1926 there were 1,250,000 people at work and 50 years later there has been no improvement in that figure but in fact the contrary, there has been a drop in that figure. I indicated that this was a persistent, longrun characteristic of the failure of the [1422] people who remained in office for a period of 33 years, 16 of which were continuous, to draw up plans and policies and engage in the right sort of thinking that would have absorbed the natural increase in the population growth, the drop in employment on the land into the work force.

I illustrated that this could have been done if the economy had been properly handled over the 33 year period they were in office. To draw a comparison with that I pointed out that Scandinavia in the thirties had a gross national product per head something similar to the Irish one. By their initiative, planning and commitment to the question of full employment, which did not exist, in my opinion, having regard to our background, they now have a standard of living three times that of Ireland's.

The other point I made was that the safety valve of emigration seemed to be the means by which, by and large, the Fianna Fáil Administration used to solve their problems in the course of those 33 years. The evidence of that—I am not saying all of those people emigrated during those 33 years as I have not checked that fact—is that there are 1,000,000 Irish-born people resident in the United Kingdom. They are from the employable and the unemployable work force. In fact, we allowed the emigration rate to get so bad that there was no provision even for catering for people who were slightly disabled to find employment. They had also to take the emigrant ship. I was on one of the emigrant boats and actually accompanied some of them in the early thirties.

There were no policies floating around at that time that would even have dealt with the heavy emigration rate of the fifties. We had some time in office then but, by and large, the fact that we had a high emigration rate was because of the Fianna Fáil policy which failed to deal with the unemployment problem.

I went on to indicate that the social consequences of this matter was worth bearing in mind because of the imbalance. We have a very large percentage of young and old people who [1423] as a result of that policy, have fallen on to the needs of the social welfare systems.

Some reference was made to the position in the fifties. If we broke even in the fifties what about the position in the twenties, or the difficult thirties? I pointed out that the war in the forties was one angle that could not be used because 250,000 Irish people, apart from those who registered for employment, were in the British armed forces. No credit is given for the progress that has been made in the difficult and trying period that this Government have been in office.

In the sixties there was a sustained economic growth. That was a certain measure of success, relatively speaking. But despite that there was the position of a lower number in the labour force than there was in 1926. In the sixties there was a 4 per cent per annum growth in the economy. Exports rose by 6½ per cent. The industrial sector expanded. The extraordinary phenomenon that supports my argument is that the policies were not correct, that there was not a genuine desire to deal with the problems. Because of that we have inherited a dreadful situation. From 1969 to 1972 there was a decrease of 17,000 in overall employment. The target of 16,000 jobs sought in the Third Programme was not reached. Consequently 33,000 jobs were lost. Where is the economics of success evident in that? If we take into account the 33 years Fianna Fáil were in office, 16 of them on a continual basis, and remember that the number at work in 1926 was 1,250,000 and is now only 1.05 million I do not think it could be claimed to be a good record.

I indicated yesterday that I would comment on the present economic situation and that I would not be uncritical of the present Administration. It was acknowledged by world-wide organisations involved in the economic, social and cultural fields that 1975 was a drastic year for most countries. We shall always have problems in trying to catch up because of the policies and difficulties of the past. [1424] In 1975 the IDA created 14,500 jobs. As against that, 27,000 jobs were lost through closures and lay-offs. The blame cannot be laid entirely on the Government for this when one recalls that Fianna Fáil held office for such a long period. When the 1975 situation—even allowing for the loss of 27,000 jobs—is measured against the 33,000 jobs deficit in the relatively healthy period from 1969 to 1972 the performance during the last three years, having regard to the increase in population, and to the other difficulties, stands up well to any argument the Opposition may make.

In the 1969-72 period we appeared, by the increase in economic growth, by the increase in expansion in industrial output, to be taking all the trappings of a carefully-guided economy but this did not materialise either because the political will was not there or because of the concept that private enterprise was the answer to all problems and a panacea for all ills. The then Government failed to realise the need to absorb into the work force those involved in the drift from the land. Neither did they realise that there would be eventually a decrease in emigration.

Fianna Fáil held office for 12¼ years of the 1960-1974 period. They delivered an average of 200 jobs per year. That could not be argued to be indicative of the economics of success. Having regard to the grants-in-aid and the growth statistics that were available, I could not accept that there was any progressive thinking at work in those periods. Fianna Fáil did not seem to gauge the situation very well and left us this disastrous situation. Although some progress took place in economic activities in the sixties and very early seventies, only a miserable 200 jobs per year on average were created. This Government cannot be blamed for that. I hope an opportunity will be given to have the matter of grants-in-aid examined properly. I am not claiming that our own Government are perfect or that we have not made some mistakes. It would be foolish to say that. However, I have a right to have regard to the peculiar circumstances this [1425] Administration had to contend with, particularly in 1975. That is worth putting on the record.

The Government in 1973 made a very good effort and the evidence is available. By their own way of spending, their own grant-in-aid system and their own approach to the question of generating economic activity they made a great effort. In the first six months of office, before we ran into the problems of 1975 the public capital programme for 1973-74 was set at £305 million. This represented an increase of more than £56 million, or 23 per cent over expenditure in 1972-73 when Fianna Fáil were in power. It was not all as a means of overcoming inflation or to deal with the inflationary spiral in the value of money.

For housing and ancillary services, £76 million was provided, an increase of £21 million over the previous years out-turn. For educational buildings £19 million was provided, £22 million for agricultural schemes and £35 million for finance for agriculture. That represented an increase of £11 million over the 1972-73 figure. There was £14 million for electricity development; £19 million for telephone development; £12 million for industrial grants and £15 million for loan finance for industry. If one looks at the exceptionally large increase of £56 million in that programme one can only come to the conclusion that it was an attempt by this Government, and a successful one at that period, to provide a stimulus to economic activity in 1973-74. We have that bit of economic activity.

It was necessary because of the situation we inherited, the social implications of the heavy demand by the young and the old on social services, to make sure that the expenditure on social welfare was increased. We did that; we increased it from £91.4 million in 1972-73 to £141.2 million in 1973-74, an increase of 54 per cent. The public capital provision for housing, the local authority housing grants, in 1972-73, under the Fianna Fáil Administration, was £25.38 million and under this Administration it was £32 million. Private housing grants rose [1426] from £6.50 million under Fianna Fáil to £8 million under this Administration while house purchase loans rose to £17.70 million compared with £9.91 million under Fianna Fáil. Supplementary grants were £2.3 million under Fianna Fáil in 1972-73 and under this Administration it was £6.20 million. The National Building Agency was not overlooked either and the provision rose from £.65 million to £.75 million. Taking the overall picture of that programme we had an increase of £19.9 million, or 44 per cent. As against the grim and depressing facts that manifested themselves through the previous Administration's lack of concern, lack of know-how or complacency in allowing emigration to be the outlet and living in the hope that that might be the solution for all time or their lack of foresight it was necessary to embark on this type of programme straight away. It was a clear indication that the political will was there on the part of the Government and that they had some imagination and foresight. Were it not for the problems they encountered later, I have no doubt that programme would have gone on. There are areas where good progress has been made but I am not going to labour that point. I wanted to make that point as an illustration against the 33 years of administration by Fianna Fáil.

That period of office indicated to the public, and to investors, that this Administration were ready and willing to tackle the problems and take up the slack left over. Confidence was engendered at that time. That was the situation in the first six months but the task has not been easy since. The stem on emigration and the population explosion have aggravated the situation. While a target of 16,000 jobs even though it was not realised under that programme might have met to some extent the problems it will not satisfy the present needs. My criticism is not only levelled against Fianna Fáil Administration. It has a dual purpose. It is also criticism of the mishandling of the economy by Fianna Fáil over the years. The need for the heavy spending as we find in the Appropriations Bill is an inheritance to some extent. Some of it, when examined, is a progressive [1427] drive towards solving our economic problems.

Fewer people were employed when Fianna Fáil were leaving office than were working in 1926. Admittedly, Fianna Fáil were not in office in 1926 but they were for many years. It is unfair to level all the blame at the present Administration when, in fact, a lot of it must be attributed to the previous Administration. I have been listening to the question of full employment in the private enterprise system all my life. When I was going to school members of my family were unemployed. I listened to people say that full employment would come. The 2 lb of free beef and the 9s we were receiving under the de Valera Administration were welcomed. Even then we got the promise of full employment. I remember hearing, when I was cycling around on a messenger bike, the job I took up first at the age of 12, that full employment would come. It reminds me of the fellow who said he wanted to be a tram driver but when he was the age to drive trams the trams had gone out of existence. That was the kind of planning Fianna Fáil engaged in. I must admit it was my ambition to become a tram driver.

On this side of the Administration I hope and trust they will not have the same unwarranted confidence in the private enterprise sector to solve the problems of unemployment, or to deal with the economy in general. It does not matter about the work of the IDA which is very praiseworthy. It does not matter about the rescue operations and assistance we have inherited from Fianna Fáil and which we have to apply now for the time being, grant-in-aid systems, and so on.

Looking at it objectively, as the Minister pleaded with us yesterday to do, there is no question but that we will have to think of a speedier move on this question of employment. I hold the view very strongly that the private enterprise system will not solve it alone. A proper balance between the public and the private sector will have to be achieved. The [1428] exclusive interests of the private enterprise sector can no longer be the criteria for the creation of jobs because they have not succeeded under the Fianna Fáil Administrations. That can be seen by the facts of 50 years. In no way will they succeed under this Administration unless we get down to saying clearly that public enterprise must also be embarked on.

Mr. Lenihan: We set up all the State-sponsored bodies.

Mr. Harte: I will come to that. I will tell the Senator how many jobs they produced in the manufacturing area.

Mr. Lenihan: We are with the Senator all the way on that. I wish he would direct his criticisms to the present Administration.

Mr. Yeats: We even bought out the trams the Senator never drove.

Mr. Harte: I could not direct what I was saying to the present Administration because they were not responsible.

Mr. Lenihan: It is three-and-a-half years now. That is a fairly long time in politics.

Mr. Harte: Measured against 33 years I do not think it is so long.

Mr. Lenihan: I am with the Senator all the way about the public sector. This is where the Government should be moving.

Mr. Harte: It is good to see that the Senator is with me.

An Leas-Chathaoirleach: Now that Senator Harte and Senator Lenihan are once more in agreement, perhaps Senator Harte could continue without interruption.

Mr. Harte: I apologise. With the number of jobs that need to be created, if we go by the figures given, the private sector will be put in an awful position to try to provide those jobs. Even if they have the will. My experience of many people in the [1429] private sector is that they are more interested in a quick kill, a capital gain, than in industrial expansion. They must be knocked on that thinking. They should not need a leg up with all the grants-in-aid and all the assistance they got from the previous Administration, but I am afraid that they do. I do not mean in the supportive type of role as I said about the grants-in-aid, and so on. They need this leg up by using the concept of public enterprise working along with the private sector to provide the jobs that are needed to meet the very extensive demands we now have and will have in the future, and which far exceed the number needed even when we had the outlet of emigration to the UK and other places. The Swedes have a national planning commission and it seems to work very well for them.

I should like to make this point clearly. I am not raising this point about the private enterprise sector as an ideological confrontation. That is not my intention. I want it to be taken as a sincere belief that private enterprise cannot do the job of providing sufficient employment to absorb the people who are leaving the land, and where no more jobs created will be created. There will be a decrease in agricultural employment. There is a heavy natural increase in the population which was not catered for by the previous Administration who showed no foresight. Therefore, we must make sure we understand that the private sector cannot do the job.

Senator Lenihan mentioned earlier they set up the semi-State bodies. It might interest the Senator to know that the number of people working in the manufacturing industries on a public enterprise basis is 3½ per cent of the total work population. That can hardly be described as being enterprising in the sense that so many jobs were needed. This side of society was neglected and the previous Administration had no will to look at this side of the problem and deal with it in such a way that public enterprise would have been the lever to make the private sector move faster and in a more objective way. If that had happened, [1430] they would have created many more jobs.

Senator FitzGerald mentioned that Mr. Callaghan said that more profits mean more jobs.

Ruairí Quinn: Today's profits are tomorrow's jobs.

Mr. Harte: I cannot accept that because it is not my experience that more profits create more jobs. I have a number of areas where I could demonstrate clearly that more profits have led to fewer jobs. I take courage from the other observation he made that, whatever points of view are put forward, whether they sound ideological or not, nothing should be ignored, provided it is well-intentioned and is not just a knocking operation.

People probably think I have a hang-up about the private enterprise system. It is not a hang-up. It is just knowledge gained from my experience over the years. As I said, I know no other way except to look at the circumstances in which I live and try to deal with them. That is the basis on which I make this part of my contribution. I have been a trade union representative for almost 30 years. I cannot make the argument that Irish industrialists in the private sector were growth-conscious. There may have been individuals who were growth-conscious but collectively they were not growth-conscious. By and large, there was too great a dependence on the crutch of Government support to bolster them.

I will not reiterate what I said about the average of 200 jobs. It is recorded now and I hope a note will be taken of it by the Press because it is an interesting statistic. Senator Lenihan mentioned the setting up of the semi-State bodies. Is he aware that in the period of Fianna Fáil's Administration they did not create more than 3½ per cent employment for the total work force in the manufacturing side of the public sector?

Mr. Lenihan: There were two guys called Lemass and Norton in 1932 and 1933.

Mr. Harte: After 33 years of——

[1431] Mr. Lenihan: We promoted industry in this country.

Mr. Harte: That is a recognition that private enterprise could not go it alone. Fianna Fáil created 3½ per cent——

Mr. Lenihan: Join the Fine Gael Party in toto.

Mr. Harte: ——of the total work force, which is a disgrace. This is not an ideological matter but I am very conscious that the public sector is needed in the manufacturing area of industry to help the terrible situation which we have inherited. There is some evidence that the Government, apart for the money they spent on social welfare, for which they must be given credit, acted in the area of natural resources. There was a tax allowance for 20 years. The Government took control of this. It was a clear indication that they would not tolerate any particular social class creating a priveleged position for themselves vis-á-vis any other section of the community.

Mr. Lenihan: What about nationalising the banking services, as suggested by Senator Kennedy in a progressive speech the other day?

Mr. Harte: I will get round to that point in a few minutes. The Government have shown, in the area of natural resources, that they, acting on behalf of the public, will work closely towards striking a correct balance between the public and private sectors. I do not need to mention the terms drawn up in the gas and mining areas. It is rather premature to discuss the oil finds because I am not sure about them at present. Nevertheless, the Government's approach is interesting and shows that they will become involved in the industrial side to a greater extent.

Research and development will not provide jobs unless we follow them up. They may help us to work out policies. This is the mistake Fianna Fáil made. The Third Programme proved that point. We are dealing with estimates. When we estimate [1432] for future employment we must have regard to the imbalanced aid structure which we inherited, the high cost of social services and so on. The fact that we are now paying the price for this does not matter; we still have to find the means of getting around it. That aggravates the position with regard to the number of jobs which must be provided. The number must be much larger than what the private enterprise sector can deliver and much more than the 3½ per cent in the manufacturing side of the public sector.

The year 1975 was a very depressing one but at least it drew the economists together in their thinking, which is not an easy thing to do. Our economists recognised the problem facing the Government. Luckily, we can point to this fact otherwise the Opposition would have slated the Government much more than they did. The problem of the international recession was recognised by economists in general as the cause of the high unemployment rate. They recognised that the low home demand was a result of this because people had to go on short-time. In some cases, employers found it hard to pay parts of the national wage agreement. Economists recognised that increased savings are not the best way of helping a recessionary period. It is a natural reaction by people who are facing a serious unemployment situation. The economists also recognised that the reduction in tariffs brought increased competition from imports. They recognised that our loss of competitiveness was attributable to the world recession and a consequent fall-off in an open economy like ours. Therefore, the Government had no case to answer for the existing situation but the economists were making a case that, if there were problems these were the factors contributing to them.

I am rather worried about the agricultural sector. I do not think that their standards will fall. The Department of Agriculture and Fisheries have not neglected to look for their share of the grants-in-aid which is very substantial—£29,422,526. People engaged [1433] in agriculture will continue to do well. That is what they are there for and I wish them well. It is not generally acknowledged that we have reached a stage where there will be a fall-off in the agricultural sector. Previously, people were absorbed in the services and much of the slack of manufacturing industry was taken up in this way. Unless we create employment in the manufacturing side of services we will be faced with difficulties because the numbers of unemployed will increase. The situation is aggravated by the growth in population, lack of emigration, and so on.

There is no evidence that there can be job creation in the agricultural sector and alongside that is the situation that more than 50 per cent of our exports are non-agricultural products. It seems to me that there might be a little imbalance there. In the period of 1960-74 agricultural employment dropped by 135,000 or 9,000 jobs a year, and the service industries only grew by about 60,000, or 4,000 jobs a year. Again, that cannot be attributed to the present Administration. Industry in that period rose by 80,000, 5,000 jobs a year. There was an international recession, as all economists acknowledge. We had export difficulties and we had problems in other areas except agriculture. We had agricultural problems in only one year but, by and large, we have not had such problems.

The fact that more than 50 per cent of our exports are non-agricultural, gives cause for concern. Looking at the grant-in-aid system one wonders if there is a proper balance in this area and whether the present grant-in-aid system is giving sufficient value for money. If there are other sides to that argument, I would be very willing to hear them; perhaps the Minister, when replying, would explain to me the agricultural aspect, as I do not always fully understand it. Having regard to the figure of 50 per cent for non-agricultural exports, the opinion might be abroad that there is an unequal, unjustifiable share maintaining some people in that sphere in a privileged social position.

Senator Lenihan mentioned the [1434] banks earlier on, and I think I can surprise him. I do not want Senator Lenihan or anybody else to cringe at the mention of nationalising banks.

Mr. Lenihan: Senator Kennedy suggested that.

Mr. Harte: I will spare the Senator that. Instead of suggesting nationalisation, I would ask why the arms of the banks should not be twisted a little more.

Mr. Lenihan: That is up to the Government.

Mr. Harte: But Fianna Fáil did not do it.

An Leas-Chathaoirleach: Senators should address their remarks to the Chair.

Mr. Lenihan: Through the Chair to the Minister. We do not happen to be the Government.

Mr. Harte: The Fianna Fáil Administration did not consider even that, never mind nationalisation. I said earlier on that, while I would level criticism at Fianna Fáil I would not leave it at that, that if I felt criticism was justified in any area, I would make it, and that I would not criticise on an ideological basis. Before we can think of developing our own programmes and progress in the industrial, economic and employment fields, we must sort out the problems and policies we have inherited. However, we must twist the arms of the banks a little to get much more favourable packages because we need them, as Fianna Fáil needed them in their time but did nothing about it.

I said I would not raise arguments on ideological grounds and my only concern is to find out if the economists, who are great men at examining situations, ever got around to the real contribution that the banks are making, bearing in mind the fact that the banks use people's money to make money. In fact, on examination of that contribution they might find that the rights they enjoy from society are greater than the obligations they fulfil. This is the context in which I would deal with the banks.

[1435] Mr. Lenihan: The Senator is talking a lot of sense now.

Mr. Harte: When we got to the point where we found that the bank employees were doing something that might jeopardise the policies or programmes that are needed to take control of the economic situation, we had the courage to legislate. It should not be left at that. If we had the courage to legislate against those people, after consideration of their balance of rights and obligations, there is no reason why we should not deal with the banks in an arm-twisting sort of way if they are not willing to cooperate. I hope I am not wronging them. It is not my intention to wrong the people who manage the banks. The fact is that even at plant and industrial level every worker must justify his contribution to society. His work is subject to job evaluation or else his contribution is measured on the national level when he comes to talk about wage agreements. Is there any reason why we should not look at the question of how the banks are managing their affairs and what role, good or bad, they are playing in society and whether it is sufficient, and if that role is not sufficient, what reasonable steps we can take having regard to the need for establishing a very healthy mixed economy?

Mr. Lenihan: The Senator should get into the Minister's chair, because I agree with him fully.

Mr. Harte: I intended to talk about the national wage agreement, but in view of the way the situation has developed and the delicate nature of the negotiations at the moment I will leave it to one side. Where there is hope we should not make any statements that might jeopardise a settlement. I think I would get the support of the Opposition on that point. For the record, I would like to mention that, despite all the arguments by the Opposition on what has been done, no credit was given in any of the arguments for the fact that in difficult times and circumstances one had to deal with social welfare, not just on the basis of social welfare but on the [1436] basis of a very detailed policy for social welfare, part of which has been implemented and under which, between March, 1973, and April, 1976, the old age contributory pension has been increased by 96 per cent, the widows' contributory pension by the same percentage; unemployment benefit for a man and a wife by 94 per cent; and in one area—the child dependants' allowance—from 130 per cent to 160 per cent. In the noncontributory area we had increases in social welfare which amounted to 99 per cent in that period. With the child dependants' allowance for non-contributory pensioners some of the increases ranged from 130 per cent to 180 per cent. That was a very remarkable performance for a Government who are supposed not to have the interest of the nation at heart and who are being criticised for having no policy to alleviate hardship and so on.

I will not labour the question of the social welfare services any longer. All I will say is that we have the problem, we have got inflation and we know the causes: the increase in oil prices, the devaluation of the Irish £ against the non-sterling currencies, the increase in indirect taxation. Of course higher farm prices were due to two things: the common agricultural policy and the increase in world food prices generally. We had domestic increases arising faster than productivity but we know this. This Government, on the experience of their first six months in office, have the will, the know-how, the talent and the ability to deal with the economy. I have no doubt that in the coming months we will generate confidence among the industrial investors. The inevitability of looking at further involvement of the public sector in the industrial side will be a consideration in dealing with the problems of solving the employment situation over the years.

Mr. W. Ryan: I do not intend to delay the House by a long speech because I know that there are quite a number of other people here anxious to contribute to this debate and the time at our disposal is rather limited. It is a pity that year after year we get the Appropriation Bill at the end [1437] of a term when all of us are anxious to get away from here, and we have to discuss it at a very short notice— at the most two days. This Bill should come to this House, if at all possible, earlier than it does so that we may debate it for, say, two days each week for maybe three weeks. After all, in this House we have not the same opportunity of discussing Estimates for each Department as Deputies have in the Dáil. Neither can we ask any questions here as they ask in the Dáil because we do not have Ministers here to come in and answer our questions. We are at a big disadvantage on that account, and therefore the Appropriation Bill is one of the few Bills where we have the opportunity of talking about everything and anything as far as the working of the country is concerned.

I am just throwing out as a suggestion that when our time is limited to a few days for a Bill we should do what is done at the Assembly of the Council of Europe. I do not know whether they do it in other Parliaments. If time is limited each speaker has to hand in his name before the debate takes place, and then, according to the number of speakers, so much time is allotted to each. Here if any speaker speaks for an hour or an hour-and-a-half as the last speaker did it means that somebody else is going to be cut out this evening and will not have an opportunity to make a contribution.

Like the other speakers from this side of the House I have very little to say in favour of this Appropriation Bill. Things have reached a sorry state in this country at the moment and financial experts tell us that the country is on the verge of bankruptcy, that we are no longer a credit-worthy nation. Those people, financiers and others, have appealed to the Government to do something about it but their plea appears to have fallen on deaf ears. The Minister for Finance in some of his speeches tells us that there is no crisis. He is inclined to say, “What crisis?” Then maybe a few days afterwards the Minister will come out and tell us that we have to tighten our belts. I wonder which speeches of his are correct. We were all very [1438] sorry he did not appear on the “7 Days” programme a few weeks ago with our spokesman on Finance, Deputy George Colley. We were all looking forward to that but it appears the Minister fought shy of it, and I for one would not accept the excuse that he made. He came on radio last Sunday of course when he was on his own. When Ministers are going on television or radio they should go with their opposite numbers on the Opposition.

I do not propose to speak about high finance. There are others to come who know more about that than I do. I want to say briefly something about the day-to-day workings of the different Departments, dealing first with the Department of Labour, and unemployment. Listening to the last speaker one would imagine that Fianna Fáil were the cause of all the labour problems we have today, three-and-a-half years after we left office. We all know that when we left office we had not too many unemployed and emigration had stopped many years before. One would get the impression, from the present Labour Party in particular, that it is since they took office that emigration stopped. Not alone had emigration ceased but people were coming back to this country from England and elsewhere and taking up work here because we were creating jobs pretty fast at the time that we left office. So we are not to blame for the sad state that the country is in at the moment as far as unemployment is concerned. We have more unemployed today than ever before in the history of this country.

The Government appear to be making no effort to remedy the situation. Money is being paid out every week in unemployment benefits, unemployment allowances, redundancy payments and many other such payments, and yet we have no money for important work such as road works. I cannot understand why money could not be transferred from the Department of Social Welfare and other Departments to Local Government and places where the money is necessary for work that is badly needed in this country. We [1439] want to build bridges and many other things. They are all now left on the long finger, and whenever the day will come we will have to find money to build those roads and if money could be transferred—and I believe it could be if the Government really got down to it.

It is a pity to see so many people unemployed because if a man is unemployed for quite a while it is going to be very hard for him to accept work when he gets it and it will be hard for him to adjust himself to a job.

Another example of where money could be spent at the moment is in a number of our smaller industries, and I mention one of those, Leathersoles in Ardfinnan, County Tipperary. The history of Ardfinnan is rather sad because we had woollen mills there which closed shortly before Fianna Fáil left office. At that time woollen mills were closing down all over the country. We were not able to do anything for it, but at least the Minister for Industry and Commerce at that time made the Ardfinnan area a designated area with the result that people were interested in coming in there and starting industries. Those people who came in started the Leathersoles factory and are giving employment to about 150 people. They did not get a loan or grant although they were promised them and they now find themselves in serious difficulties. They want £200,000 of a loan. They have not got that loan so far from an Fóir Teoranta and unless they do this factory will have to close. I think that £200,000 is a small amount of money to give as a loan to an industry which is giving employment to 150 people. If this factory closes and those people have to go on the dole, the £200,000 will not be long there before it is eaten up anyway. This is a small industry.

We have a very big industry south of Clonmel between Carrick and Clonmel which is called Merck, Sharpe & Dohme which has cost millions of pounds to build. I am not sure how much has been given by [1440] the State to this industry but I am quite sure it has run into millions of pounds. That industry is only giving the same employment as the factory in Ardfinnan. I appeal to the Minister to endeavour to get this loan from an Fóir Teoranta for this small industry. It means a lot to that area. I am sure that I am not talking about just one small industry, that there are numerous small industries all over the country in the same plight. Governments are always inclined to give money to big industries and the small ones are neglected. I believe that the smaller industries are far more important than the bigger ones. We all regret seeing so many young people leaving school and finding it impossible to get jobs. This is a very sad state of affairs.

On local government, the present Minister boasts a lot about his housing schemes and all the houses which he has built since he became Minister. One would imagine that during our time in Government we did not build houses at all. Funny enough, in 1972 we built 22,000 houses and in 1975 25,000 houses were built, an increase of just 3,000. Listening to the Minister, I thought he was building at least 20,000 a year more than we were building when we were in office.

While he may boast about all the houses he has built I think he should hang his head in shame as far as other things which have happened in that Department are concerned. He decided, some time ago, to cut the housing grants. Any single person who was earning over £37 a week was not eligible for a grant for the building of a house. For a married couple the income limit was £39 a week. How many people today are earning less than £39 a week? What it really means is that 50 per cent of people who want to build their own houses are cut off. They cannot build their own houses and they have to fall back on the local authorities to build houses for them. People with an income of less than £37 or £39 a week would not be in a position to build a house so you [1441] could nearly say that as far as grants are concerned they have been taken from everyone.

Another thing which the Minister for Local Government did during the year was in regard to the agricultural grant of £17 a year. It was a very small grant. Farmers had often asked different Governments to have this grant increased but to no avail. As bad as it was under the Fianna Fáil Government, when the present Minister took office he took the grant away altogether. I think it brought in the paltry sum of £500,000.

It might be said that this Government are a Government of indecision because they have made statements from time to time to the effect that they would do something and then when they found out that certain sections of their voters were against it they suddenly changed their minds. An announcement was made recently by the Minister for Local Government that the rents of local authority houses were to be increased. The new rents were fixed. I understand that most rent collectors had two weeks rent collected when the Minister suddenly changed his mind and decide to put it in abeyance for the time being. That would make one very suspicious as to whether there was a general election on the horizon. Perhaps this is the last day that this House will meet before the next general election. We on this side of the House believe that the sooner a general election is held the better.

As far as roads are concerned, in my county, Tipperary, in 1975 we got £497,000 in grants for roads from the Department. In order to meet the needs of 1976 we would require £679,000 to do the same work as last year but all we got from the Department this year was £428,000 which means that quite a number of our workers will be idle by the end of the year. Our county engineer assured us that he would find work for them but I do not know where he is going to find the money to pay them.

There is the main Cork/Dublin [1442] road going through County Kildare and part of County Laois on which work was commenced maybe two years ago and was never finished because there was no money available to finish it. I think it is a disgrace to see the most important road in Ireland not completed. It is a danger to everyone. I have seen quite a few accidents there and I cannot understand why money cannot be found to complete the job. If we have not got money to start new jobs that is all right, but at least a job that is started should be finished.

I cannot understand why we cannot get money from the EEC. We were told at one time that moneys would be made available from the EEC for a lot of things. I cannot see why more money is not made available for road grants in order to improve major roads. The traffic on our roads is increasing steadily.

The last speaker mentioned how much the Coalition had done for social welfare recipients. To give credit where credit is due, there have been big increases in social welfare. I am convinced that what one got in social welfare when Fianna Fáil were in office, taking into account the cost of living, compares favourably with what one gets today. I am concerned with the statement made here on 6th July last when we were discussing the Social Welfare Bill. We were discussing the fine of £500 which the Minister proposed to introduce for anyone who made false claims in so far as old age pensions were concerned. I felt the fine was too big. In the course of his reply the Parliamentary Secretary said that in 1973, before Fianna Fáil left office, if anyone earned more than £26 a year, he was not entitled to the old age pension. I felt that was not true. I have been a member of old age pensions committees for a number of years, and always thought that if a person's income was over £26 a year his pension was reduced by five shillings. On that occasion I asked: If your income exceeded £26 a year in 1973 you were not entitled to a pension? The [1443] Parliamentary Secretary, Deputy Cluskey replied: “No, I am afraid not”. He went on to say:

The Senator said he was a member of an old age pensions committee, surely he should know that. It is a fact.

Mr. W. Ryan: If your income was over £26 a year you got nothing?

Mr. Cluskey: No. We went into that.

As Deputy Cluskey is a Parliamentary Secretary I said to myself that he should know better than I, but I went to the Library and got a copy of a booklet entitled “Summary of Social Insurance and Assistance 1972-73.” On page 61 a paragraph dealing with non-contributory old age pensions reads:

A person who has reached the age of 70 and does not qualify for a contributory old age pension is entitled to a non-contributory old age pension if he or she satisfies a residence test and has yearly means reckoned at not lower than £273.75, that is, about £5.25 a week.

Mr. Lenihan: Credibility how are you.

Mr. W. Ryan: I cannot understand how a Parliamentary Secretary could make such a mistake. He had two advisers with him at the time.

Mr. Lenihan: Some people will say anything.

Mr. W. Ryan: It looks that way. I hope the Minister will clarify the situation. That point escaped the Press; it did not appear in any of the newspapers. Our colleague, “The Senator” in The Sunday World, must not have been in the House when the Parliamentary Secretary said that.

On the subject of CIE, I saw in today's papers that ten more stations are to be closed down. I am not blaming the Government for the closure of the stations. Since I was a small boy, CIE have been closing stations and [1444] many miles of railway lines. They tell us that closing these stations will help cut costs, but it seems that the more stations and lines they close, the more money they lose. In their recent announcement they stated they are closing stations between Limerick Junction and Waterford, such as Carrick-on-Suir and Cahir, for freight services. CIE policy seems to be to run down a line and then say it is not paying. In fairness to CIE I know the railways here or in any country cannot pay their way, but they are providing a service. CIE have a main road from Dublin to Cork and main roads from Limerick to Waterford and all over the country. How much does it cost to maintain those roads? If we compare the main Dublin to Cork road with the railway line from Dublin to Cork I am sure it is not costing as much to maintain the railway line as the road. If we find ourselves in a few years' time without any railway lines, our roads will not be able to handle the traffic. We are not giving enough subsidies to CIE. Whether we like it or not, CIE might be described as a necessary evil. The rail service will have to be maintained because our roads were not constructed to take the amount of traffic they now carry.

The Office of Public Works is spending very little money on buildings around the country. As far as national monuments are concerned, great work has been done by the Office of Public Works, helped by our Archbishop. I can understand moneys not being available just now for the restoration of national monuments, but public buildings, such as courthouses, police barracks, post offices, bovine TB offices and schools, are in a shocking condition. The barracks in Tipperary town is in a disgraceful condition. It must not have been painted for 20 years. The same applies to the bovine tuberculosis office in Tipperary where a large staff are employed. I imagine the situation is much the same in other parts of the country. Surely a few pounds could be found to make life more pleasant for those working in those places.

[1445] Arterial drainage seems to be completely forgotten. I was on a deputation in 1960 to the then Parliamentary Secretary to the Minister for Finance about the River Suir. He told us that work would commence about 1970. This is 1976 and we are further away than ever from the arterial drainage of the River Suir. This applies to the Barrow and other rivers throughout the country. It is to be regretted that we cannot find money for such a useful purpose. By draining the River Suir we would increase our acreage. There are acres of land from Waterford to Templemore which are flooded most of the year.

The same applies to the River Aherlow, which is a tributary of the Suir—acres of land could be made good land if the Suir was drained. Money spent on the drainage of the Suir would be money put to good use. We would get a quick return because land can be reclaimed pretty rapidly.

We hear a lot of talk from the Minister of Justice and from the Taoiseach about law and order. They describe themselves as the law and order Government. They may be, but British soldiers seem to be able to come across the Border now any day they like and pick up Irish people from this side of the Border. If we are maintaining law and order as far as the IRA and other similar bodies are concerned, we are neglecting law and order all over the country, and in every town and village today there are robberies, people are being beaten up, and there are no gardaí to do anything about it, because the gardaí, I understand, are not getting overtime. In Tipperary recently, a bus load of people came in from Senator O'Brien's city of Limerick—I am not saying that he was responsible—and they beat up half the people in the town. There were only two gardaí available in the town at that time and by the time reinforcements were available much damage had been caused and many people injured. Only two weeks ago a train from Limerick going to Thurles for the Munster semi-final arrived at Limerick Junction and the train was a total wreck. Not alone was the train a [1446] wreck but the people on it had tried to wreck the station. In Tipperary town there were only two gardaí on duty. By the time other gardaí arrived a lot of damage had been done.

Mr. W. O'Brien: Bad drink was the cause of it.

Mr. W. Ryan: Drink might be the cause of it. But when they had only arrived in Tipperary they started the row so they must have got the drink in Limerick before they left. If we are not going to pay our gardaí overtime it will be a sad day for the country because there will be robberies and old people particularly will be afraid to be at home alone at night. No house will be safe, be it in the towns or in the country. Those people are roving around and now that the banks are closed—they were able to rob money every other day from the banks—they will have to try to find money elsewhere.

As far as agriculture is concerned, Senator Butler mentioned yesterday that he had no sympathy for the big farmers of over £100 valuation paying income tax. I have not either. But they are not the only farmers paying income tax. The small farmer who has some other job has to pay income tax now if his farm valuation is over £200. The man with a 100 acres is valued at £40 to the £ valuation. The place of the man with a £40 valuation and a job, is valued at £80 to the £. The first £20 is not counted. That looks ridiculous to me because the man with the job obviously could not be making as much out of farming as the fellow that is giving all his time to the farm. That is where I disagree with income tax. I think it is most unfair that the small man with a £23 valuation or a £22 valuation is now taxed on his farm. I am disappointed that the poorer areas of Ireland, and there are a few of them on the Tipperary/ Limerick border—do not seem to be getting any advantage from the EEC. We were told that those depressed areas would get special attention but we find now that that is not the case.

[1447] Another matter which I regret having to raise here concerns the Department of Foreign Affairs. I am one of the members of the Council of Europe at present and as most Senators are aware, each member of that Council of Europe is a member of at least one or two committees. I am a member of two committees, one of which is known as the non-member countries committee, and at the assembly in May, the secretary approached me and he said that it was Ireland's turn to invite the committee to Ireland this year. This is the practice with those committees. They are invited to different countries once a year. He said that he wanted me to invite the committee to Ireland at the meeting which would take place that day. I, foolishly enough, thought there was no problem. I went to the meeting and I invited the committee. They accepted the invitation and fixed the date towards the end of August. It was to be a two-day meeting in Dublin.

I then informed the Department of Foreign Affairs through the leader of our delegation, Deputy Collins, and I discovered after some time that the Department of Foreign Affairs were not very happy about this committee coming to Ireland. A lot of obstacles were placed in our way. We were told that this Chamber would not be available for meetings because it would be undergoing repairs. We accepted that. We were then told that Iveagh House would not be available to us. It was suggested that we could have this meeting of 30 people in some hotel, and the cellar in Setanta Buildings was even suggested for a meeting place of this kind. We were told also that the Department of Foreign Affairs had very little money to spend. They would give us around £300 and there would be no entertainment whatsoever as far as that Department were concerned.

That in my opinion was the last straw and I said to the secretary here that we should cancel the trip, that we should inform the secretary that we could not take on this meeting in Ireland this year. This is a disgraceful [1448] state of affairs. We are supposed to be a very hospitable nation. We are supposed to be very generous. Everyone looks forward to coming to Ireland. In the Council of Europe there are 18 nations and every one of the nations would have sent at least one person here for those two days. They were looking forward to it. We find now that because the Department say they have no money, we have to cancel it. During the year we, as members of the Council of Europe, will be invited to other countries. I just do not feel like going, because I feel that from now on as far as the Council of Europe is concerned we, the Irish delegation, will only be looked on as the poorest nation there. Even if we are the poorest nation, which we are, we should not advertise that to the world. In Ireland I know of many poor people who might not have the price of their supper, and if a visitor came from some other country or even from Ireland they would make sure that they had something for that person. They would not give that person the feeling that they could not feed him. That is the position here. If that committee came here the Department would be expected, as is the custom to give them at least a lunch or two lunches, and take them on a bus tour. That is the practice everywhere else. I am sorry to say that our Department of Foreign Affairs cannot do that.

I just want to mention the bank strike briefly. If the strike lasts for another few weeks it will be a disaster for the country. Money is becoming very scarce. The petrol companies are treating the people very badly. They decided as soon as the strike began that they would take no more cheques from the retailers, although they had been taking cheques all along from people in that business, with the result that now every payment they get for petrol has to be in cash. I do not believe that they have to pay that cash to the Arabs or whoever is supplying the petrol. I am convinced that they are investing that money in some other country at perhaps 15 or 16 per cent. The petrol companies are of on help to us at the present time, nor indeed were they ever much of a [1449] help. If any section should be nationalised it should be them.

I should like to draw the attention of the Government and the Minister to a new phenomenon in this country in recent years, the travelling shops. In Tipperary town the market is completely taken over once a week by those traders. I understand they even come from England with their wares. They sell goods much cheaper than any shop in Tipperary can sell them. One shopkeeper told me that he could not buy the goods from the manufacturer at the price they were selling at. That would make one very suspicious as to where these goods are coming from. I do not believe those people are paying VAT, income tax or rates. I understand that this does not apply to Tipperary alone but that it is happening all over the country. The shopkeeper must pay taxes and rates and it is most unfair that these people should get away with this. The urban council in Tipperary town have discussed this. They have tried to find a way out of it but they cannot. According to a law or charter of King Charles I or King Charles II, the markets were set up around that time for people selling their produce. Therefore, the urban council in Tipperary or in any other town cannot stop them from coming in but an Act of Parliament could stop them. I am asking the Minister to take note of that and to have a Bill introduced after the recess and have that matter set right, because it is unfair to our shopkeepers that this unfair trading should be allowed to go on.

Mr. Kilbride: I do not intend to delay the House very long but some observations have been made by the Opposition and on this side of the House that warrant comment. At this stage in our history we find ourselves part of a bigger economy to the extent that we are a member of the EEC. The economy of the whole world has been rudely shaken over the past two or three years and as a result the ordinary outlet of emigration has practically disappeared and we find, therefore, a younger and a maturing generation taking their place in the life of this nation. In these circumstances [1450] we should look objectively at the responsibilities that devolve on us and the remedies that may be applied to our problems. We have a problem that is the responsibility of every man and woman in this country, to face up to the fact that our people have suddenly been brought face to face with a situation that is not of their making and which, because of world trends, has imposed severe hardship that should be shared by all the people. There is a storm to be weathered and a plan must be made to overcome our difficulties and to set us again on the road to progress.

We could not escape the economic blizzard that has hit Europe. The extent to which it has hit us has put an obligation on the Government to make provision by way of unemployment assistance and amenities for those who became unemployed or redundant and have been cast on society with a right to ask society to stand behind them to lessen this difficulty. This Government have been doing that in full measure and to an extent that is both Christian and national. If they had done any less in that direction, it would be not worthy of the National Coalition Government. The people have to meet this obligation. As a nation we have to think of how far, having taken the severe pressure off the people, we can ask the same people to go on meeting the problems in a direct and personal way. I am not referring at this stage to the people who have lost employment, although it applies to them to a considerable extent, but to those who are in employment and to those who control industry, and to those who, because of their strong and powerful influence as organised sections, are today trying to extract from society and from the nation perhaps an unwarranted proportion of the wealth of this country.

It is significant that at this stage when there are so many young people leaving school, available for employment, being unable to obtain it, for one reason or another but particularly because of the trade recession, we have 10,000 of the best-paid [1451] people in this country in the most influential positions who are refusing to continue to give their services to the public at a time like this. We could ask ourselves how far these people are justified in not taking a patriotic stand in the difficult times facing the country.

Those people engaged in industry, who control the wealth of the country in so far as investment is concerned, are entitled to examine the profit situation here as compared with elsewhere before making further investments. Those people who have invested here and are living here have a responsibility in these difficult times to meet their obligations in so far as maintaining employment is concerned, even when there are no profits. This obligation is not met 100 per cent by some employers.

The difficulty is that organised sections in every walk of life are putting pressure on to force the Government and other sections of society to concede something more than they had when the economy was in a better condition two or three years ago so that they will not have to tighten their belts. This philosophy did not originate in Ireland; it is of eastern origin. It is a philosophy which will not benefit the nation. It is proper that people should organise to obtain or preserve legitimate rights, but when it comes to forcing a situation in order to extract an extravagant amount from the rest of society, causing an imbalance in the economy, the Government must show they are the Government, and the Government are doing exactly that in the present situation.

The ordinary people, the unorganised section of society, dependent on a sound economy and a fair and just Administration, are looking to the Government to ensure that their interests will not be exploited. The Government are answering them in the affirmative—they will now allow that to happen. At this time everybody has an obligation to the nation. The contributions from the Opposition benches are just a tale of woe. Opposition Senators present an image [1452] of a country going bankrupt. That is not a patriotic stand for an Opposition. Potential investors from abroad who hear these arguments would be justified in asking if these people are telling the truth and is this really happening.

Over the past three years there have been great difficulties in this country and throughout the world. The Opposition had the opportunity at the church gates and crossroads of telling the people what they are saying here. On none of the occasions—they had five or six—did the electorate indicate that there was any great swing towards party promotion. I am not referring to them as having a policy. In Cork North-East, an agricultural constituency, the people were asked to give a decision on the National Coalition Government and the vote given in the general election stood. Indeed, there was an increased vote for the Coalition rather than a swing towards the Opposition. That indicated a condemnation of the latter. Later, in Galway, Fianna Fáil painted the same picture just when the country was emerging from the difficulties of the agricultural depression. Again, in two Galway constituencies they were told by the people that their policies were not acceptable. The people of North-East and South-West Galway told Fianna Fáil that they placed their confidence in the Government and they increased their support. There were other by-elections, one in Donegal, and there Fianna Fáil were not able to show any great justification for their existence. It is difficult to believe that the picture of woe, depression, bankruptcy, and all the other gloom about the Government will be accepted by the people.

I compliment Senator Ryan. He was reasonably objective and fair in his contribution. He did say that many things needed to be done, money needed to be spent, including money on CIE, the latter to avoid the consequence of Fianna Fáil's decision on the McKinsey Report authorising CIE to close lines in 1968. This was simply a Fianna Fáil exercise. Senator Ryan now calls on the Minister to step in and bolster that situation in which it [1453] is evident that those lines are unecoomic. He calls on the Minister to provide more money to back up that sort of situation. He called for money to promote Board of Works schemes on ancient monuments—these expressions from an otherwise fair-minded man.

These are symbols only of the general policy of Fianna Fáil throughout the country. At every local authority meeting there is a howl for more money for this, that and the other scheme, and a belittling of the efforts being made by the Government in regard to housing, water, sewerage and development generally at local government level. The Fianna Fáil people think that if they say it often enough— no matter how great may be the lies —they will get a section of the community to swallow it and believe them to be talking the truth rather than from figments of their imagination.

Circumstances have arisen here not exclusive to this country. They are common to most European countries and other powerful nations in which the economy demands that we tighten our belts and produce more; that more of us take off our coats and work more diligently to this end. That is what we should be talking about doing and it is our only salvation. If we would all join together, realise our national responsibility and live up to it, then we would be in a position to say we can see the light at the end of the tunnel; we will be out of the recession; we will have a resumption of industrial, commercial and productive activities at a level that will justify our efforts. Unfortunately, we do not appear to be doing so. Too many people are trying to exploit other sections of the community. Therefore the Government are now forced—I do not say this uncharitably—to assert their authority. I would hope that the Government will not be called on to a greater extent than is reasonable by a patriotic people such as ours. In saying that I refer to every section of our community. The Government are being asked to stand in and assert the rights of the ordinary people of this country and I am sure they will not fail them.

The policy of the Department of Agriculture and Fisheries is something [1454] that was omitted by many contributors to this debate. At no stage in our history has there been a Minister for Agriculture and Fisheries who had the support, approval and commendation of every section of the agricultural community to the extent that the present Minister has. I am glad to see that the difficulties with the veterinary profession have been settled. The Minister has now to go back to the EEC and ask them to revise the development schemes we inherited when we joined the EEC. These schemes are not all in the interests of the smaller farmer. They were designed, apparently, for the man with 100 or more acres of land. In the western counties—and my own county of Longford is classified as one of those—the smaller farmer cannot possibly reap the full advantage proportionate to that of his larger counterpart under this scheme. If he has a certain income he must have a target which the size of his farm does not justify the Department of Agriculture and Fisheries asserting on paper. This is something that will have to be re-examined. I am glad to note that the Minister has indicated he is approaching the EEC with that purpose.

This Government have a magnificent record in housing. Those who may say the reverse can come to my county and see in every parish and townland two, three and four new housing schemes—rural schemes of one or two houses and, in towns, schemes of as many as 400 houses. There is a very extensive scheme in Longford town. If such people do not want to believe the Minister or the Department's figures—and remember they were questioned by Fianna Fáil —if they do not want to believe that let them come and see what is being done with the money in respect of which the Government have been criticised for borrowing.

There is the younger generation taking their place in society in this country, anxious to set up home, people to whom the emigrant ship is no longer available because of the economic difficulties obtaining across the water. These people must find [1455] homes here. If they are not all able to obtain employment the Government will be able to provide them under some local government housing scheme. Those of them who are employed are being provided with reasonable grants and loans. In fairness to the Government and to the Minister, it is only right that the increased amount of money made available for housing in the current year is being given to the most needy people. If anybody must have their incomes curtailed or endeavour to tighten their belts, it is those in the higher income group.

I would like to commend the Government on how they faced up to the security problem in this country. The Government have been the envy of governments in other European countries. They have set the headline for the way a responsible and national Government should act. I do not want to go over the events of the past year or two but I think the behaviour of the Government in the area of security and progress in general has the confidence of the people. This Government are facing up to their problems in the right way. Fianna Fáil want to restrict credit irrespective of the difficulties created. They would like the Government to make unpopular decissions in the hope that Fianna Fáil would be returned to office. It is not the fault of this Government that Fianna Fáil were put out of office. They were put out of office by the people because of their own policies or lack of them. More than one speaker on the Fianna Fáil side has said they would welcome a general election. They might not be so glad if that happened. They can look forward to a repetition of what happened in Monaghan, Mayo and Galway. In addition, Brendan Halligan was successful in the Dublin by-election. The people will be prepared to follow that trend. The Government will weather the storm without Fianna Fáil.

I am very glad the economy seems to have taken a turn for the better. I want to congratulate the Minister and the Government on the success they are making of the economy.

[1456] Professor Quinlan: I welcome the opportunity provided by the Appropriation Bill in having a general and a rather wide-ranging discussion. The change this year is very well worth while. Over the past four years we had an arrangement by which the Appropriation Bill only arrived at Christmas when it was totally and utterly out of date and badly placed and we lacked the opportunity for a general debate in the Seanad. I hope that the present arrangement will continue from now on.

It would be well, of course, if the debates on the Finance Bill and Appropriation Bill could be closer together, or even merged in one general debate, because it is difficult to separate the two. It creates many headaches for the Chair to try to decide what is appropriate to the Finance Bill and what is not. In my contribution, seeing that the time is short and that the Minister is to be allowed to reply at 4 o'clock, I will not traverse the ground covered in the Finance Bill debate. I will proceed to the many other facets in the Appropriation Bill that call for comment.

The first and outstanding feature is, of course, the present difficult situation, a situation which is largely a product of the general international depression. However, it is aggravated very considerably by the fact that our expectations were raised to unrealistic levels on our entry into the EEC. We thought that El Dorado had arrived, that the future was golden, that the £30 million which we gained from the EEC by direct relief on agricultural subsidies was the passport to El Dorado. We spent that money. We increased salaries, social welfare payments and all others—rightful increases and a right policy if the future was to be as we all believed it would be. But that was changed drastically when the OPEC countries said we should give back £200 million. One does not have to be an expert in higher mathematics to realise that if we get £30 million and one has to give back £200 million one is somehow a good deal worse off at the end than at the beginning. However, that [1457] message has not penetrated through to the trade unions and to the general populace as a whole.

When I refer to trade unions I have to accept the fact that all sections, for their own protection one way or the other, have to be in trade unions, including university staff. I am castigating all of them. The trade union principle was highly important and necessary in the past when the trade unions were fighting for decent standards of living, the right to life almost, the right to subsistence. However, that same principle when applied today is in a very different context. Today the individual groups with their sectional interests can no longer be the arbiters in their own case. It is absolutely against all principles of national democracy that small groups will sit down solemnly and decide whether they will accept what they are being offered without taking into context the general situation.

Positive leadership has to come from their organisations. It is not unfair to say that the response here has been a great deal less nationalistic and less patriotic than has been the response of the British trade union movement to Britain's dilemma.

We are aware that Britain came to the precipice six or seven months ago. The trade union chiefs probably did not like what they saw. They became amenable to rational argument. They sat down around the table. One Minister, Mr. Prior, said endless hours were spent in the process of getting across the message of the national problem. The magnificent response shows that England is not dead yet. Neither will England be a drudge or a deadweight on the EEC if her people are capable of the magnificent response they have made to the Government's call for restraint in recent months.

I hope our trade unionists and employers will take the same line. We are on the edge of the same precipice as Britain was last Christmas. We have not realised it fully yet. It is alarming that the fight against facing up to reality is largely influenced by British based unions. The very same unions that have faced up to reality [1458] in Britain refuse to face reality here. They prevent others who know reality from facing it in out context. Is that sabotage or ignorance? Why should there be a failure to recognise that what was absolutely necessary in Britain consequent on the same world depression and the same world crisis should apply here also?

I hope that when we assemble again we shall have seen some light at the end of the tunnel. Perhaps the narrow rejection of the national wage agreement may have a beneficial effect if what is proposed now is carried through, that is, that the Government should be involved directly in the negotiations between employers and employees. The Government are talking for the general public, the consumer public, the people who are not involved either as employees or employers. They still constitute the majority of this country, be they self-employed or social welfare recipients.

The Government have every right to be on those negotiations. Obviously you cannot fashion a wages and incomes policy independent of national taxation and other policies. The package has to be there. I hope we shall now get down to a realistic approach to that and that at the end of the interim proposals we shall have a fully comprehensive policy that we shall all be committed to in the interests of pulling the country out of the present dire situation.

The Government expansionary policy is exactly the same as that of any Government that believe in the future of the country and the opportunities offered by the EEC would have followed. The fact that this has not materialised calls for drastic change and reappraisal by everyone. I hope that is coming. I must sympathise very much with Ministers and in particular with the Minister for Finance who has an absolutely unbearable burden. We have at many times in the past pointed to the failure to modernise Parliament and to rationalise the system, to give Ministers time to think and give the Houses of the Oireachtas time to make a real input into the thinking process, through adequately organised [1459] committees. We are still waiting for that. I must castigate the Government for their tardiness in that regard. It is understandable that new Ministers have been so overwhelmed by the task of Government that they have not had time to think how to face up to these long-range difficulties.

These have been doubly compounded by our admission to the EEC because so much of the Minister's time is taken up by commitments at the EEC that they cannot have time to perform their regular duties at home. In other words, we have come to a breakdown in organisation of Government. We have got to see how we provide this leadership and the organisation of talent to do that. Nothing illustrates this more than the porfolios held by the present Minister. As if Finance was not enough there is the Department of the Public Service attached to it. Surely in the present crisis the first thing that the Government should do is to separate those two Departments. One man cannot be expected to handle those two Departments. Likewise, I asked, as an emergency measure, that committees of the Houses, especially of Seanad Éireann, be set up.

An Leas-Chathaoirleach: The Senator is straying from the Appropriation Bill. Reform of the Houses of the Oireachtas is not covered in the Appropriation Bill.

Professor Quinlan: I am concerned with the item in the Appropriation Bill which lists, among others, the salaries of Senators and the cost of the Houses of the Oireachtas. I contend that we are not giving value for money for what we are doing in this. Indeed, standing up here and declaiming from the rostrum is a very poor way of giving return for that remuneration. We should engage in hard work in the committee room where we would have the experts face to face and not carefully hidden behind the Minister's back where they cannot answer us and we cannot question them. That is old-fashioned. It went out with Parnell's time. If Parnell [1460] was here today, he would find that nothing had changed since he was here except that the complexity of Government had increased several hundredfold. We have got to face up to reality and to the fact that we are living in 1976 when, in addition to the national dimension of their responsibilities, Ministers have the dimension of the EEC. The main feature of the present situation—if we forget about finance—is the human dimension. The question of employment should be uppermost in our minds. The unemployed do not go hungry today. That side is catered for.

Business suspended at 1 p.m. and resumed at 2.15 p.m.

Professor Quinlan: On this, our final day here for this session, it would be inappropriate to let the occasion pass without letting it be known loud and clear that Seanad Éireann stands behind the Government in this present bank strike, a strike that is totally unnecessary and unwarranted. The criticisms of Government intervention are totally unfounded. What could any negotiator have asked two weeks ago? The Government were to give a “Yes” or “No” to a set of proposals. Any child in the infants' class knows that that was an impossibility. To have given a “Yes” to those proposals would have been to sabotage completely any chance of getting any worth-while agreement or indeed any rescue operation on the national wage agreement —in other words, to have totally wrecked the economy.

I was appalled, as one who has been connected with public life for almost 20 years, to read the sentiments of the leader of the IBOA when he said that this was a fight to a finish, either they cracked or the economy would crack. Is it reasonable, is it right that any privileged group within the community should say that, if necessary, they would wreck the economy in order to get what was more than their fellow citizens and fellow worker were entitled to? I put it on record here that we stand firmly behind the Government's intervention in this regard. The [1461] Government had to intervene. There was no point in intervening when an agreement had been reached, when the percentages were way beyond what the national economy could afford. It is a serious business of life or death for the nation and the Government must be given all the support possible in their handling of it.

The IBOA would be well to heed the calls by the presidents of the chambers of commerce and others to return to work. An arbitrator is now at work. What is the point in continuing to try to strangle the economy of the country by their actions? Not alone that but they are committing hara-kiri because when the strike is over those who have been facilitated by the Bank of America and all the other banks that have remained open will have learned a lesson from the three strikes that have occurred in five or six years in our own banks. They will be reluctant to deal again with those banks that have been involved. This means that the Irish banks will be the losers. It means that they will be replaced by non-Irish institutions, operated from outside, but at least guaranteed to deliver the service that is needed, in other words, to provide a banking service that is free from the threat of strike.

I cannot understand such irresponsibility especially since most of the officials whom I know and whom I have talked with are totally opposed to this. It seems to be a situation in which a group of men, a national executive have taken what I can regard only as a decision to strike within a half an hour of getting the request of the Minister for Labour to postpone action until the Government had an opportunity to examine the situation. They struck without taking a ballot of any sort from their members, who were conned into giving this power to such a body. But the losers are both the banks and the officials. Regarding the long-term prospects, I can see nothing but wholesale redundancies in the Irish banking system if it is to be replaced by non-Irish banking systems. I ask the officials, if they are concerned for their positions and their livelihood, to wake up and see what is happening and for [1462] the sake of the country to call off this strike and let the arbitrator give his verdict.

Also those groups like oil companies and other retailers are playing their part in trying to strangle the economic life of this country by their hardline policy of not cashing cheques. Cheques should be cashed where the presenters are known. There should be an effort by all to try to keep things going in the present crisis.

Again, in this regard and in regard to the crisis situation, we have far too little exposure on television especially by our Taoiseach and by other members of the Government to try and bring home the message. It is left solely to the Minister for Finance to try to do all the work. I have outlined the impossible task he has. It is high time that the Taoiseach put on a performance on a par with what he did in the USA on Saint Patrick's Day, a performance which we were all proud of and cheered, but we need a Churchill-type performance on our television screens now in order to bring home to our people the crisis we have, the sacrifice that is called for, the type of sacrifice that Churchill asked for when invasion was at his door. Perhaps it may not be quite as dramatic in that sense but in the financial sense it is just as real and just as pressing.

We cannot but be alarmed at the forum that television provides for all sorts of radicals to put their message across. We are tired of listening to those left wing radicals who are having a field-day on our television screens and who in every way possible are trying to upset and undermine Government action to try and bring stability into our system. It is about time that RTE woke up to the provision of impartiality in the Broadcasting Act.

I want to turn then to our main task—the creation of employment. Today, with the development of the social welfare system for which we all thank God and which is a realisation of the common brotherhood of man and the realisation of our concern for our fellowmen, the loss of employment has not the grave psychological [1463] or economic consequences that it had in the past. But the loss of the right to work is far more serious. That now becomes the dominant right.

The young people leaving our schools have that right to work; so have those in employment and so have the people in the older age group where we have all the advocates of early retirement and so on. But, that is denying the right to work to those in that category. One might say all the furore about women's opportunities and so on is concerned with the right of married women to work. There is also the right of a person to do overtime in one job or have another job. Those rights are there but when the amount of work available is limited the Government have a duty as far as possible, to assign some priorities. One cannot assign priorities directly but the tax system is one means that ensures that Government policies influence the trend of affairs.

Of all the groups I mentioned, the most pressing are the school-leavers. Elderly people who are temporarily out of work and can return when things improve will not suffer the same psychological effects as the young school-leaver. It is the worst possible start for a school-leaver to be unemployed for even a year after leaving school. It is something we can never repair afterwards. I am not concerned with the overall figures on unemployment, 110,000 or 115,000 because, compared with other countries, we have done better than some, and we have tried to cushion it as much as possible. I am concerned with the large number of teenagers in that figure. Primarily it is these we should be concerned with. That is why I should like to renew a call I made on the Finance Bill for a special work scheme for such people. This can be based on an amenity scheme. We all recognise that there are many things that need to be done which do not require expensive planning or expensive equipment for their execution; just requires organisation, getting groups together, and simple tools. In all towns, villages, seasides [1464] and so on there is tremendous scope for this amenity work.

The greatest feature of the youth of today is their ruggedness and idealism. It has become the thing to do for schoolgoers to go into summer vacation work, and take on the most menial and most difficult jobs. In other words, they have that great verture of being able to face up to all sorts of work and difficulties and to get fulfilment from doing that type of work. Such an attitude applied to amenity work on a short term basis would be a tremendous asset. I call on the Minister, and the Government, to see if anything can be done in that regard. We could harness into that a great deal of local voluntary effort for those who are fortunate to be in employment and who can lend some time to this type of work.

At the other end of the scale we have those who have early retirement, or who find themselves declared redundant while they are still fit and active. It is soul destroying for such people to be forced to be inactive. They are probably well catered for by pensions and other payments, but that is not what they want. They are looking for work, they are looking for fulfilment. These people could be involved in any amenity scheme for very little or almost on a voluntary basis to give the direction they would gladly give to such schemes. There is great scope there. At the end of that list of employment I put the question of married women at work. It was all very well in times of full employment when the EEC were looking for workers, when they were encouraging married women to go back to work but it was at the expense I would almost say, of neglecting their families certainly, depriving their families to a certain extent.

That does not prevail today. Therefore, our tax laws and public opinion should combine to impress that the highest vocation for the married woman, especially while her children are young, is in helping to rear them and educate them by every means possible, to train them in the art of home-making and so on. In such a situation it is wrong that our tax law should give a special allowance to [1465] married women at work. An equal allowance should be given to married women at work in the home. In other words, cut that differential. There is no case for it today. It is wrong. If married women work by choice I would like to see that the tax system would give a special incentive or premium to having some help provided in the home. I want, on the one hand, to ensure that there is help available in the home and, secondly, to tap this source of employment for those who would be glad to use it. If a married woman must work, let it be that she is exchanging one type of employment for somebody else coming in to do her job. Full time employment and rearing of her family are totally incompatible and can be seen to leave a mark on the children brought up in such situation. It is not the ideal for any country to aim at.

On the question of employment, I would suggest to the Minister, since he is overburdened, that he should consider as a matter of urgency in this long vacation the setting up of a committee of Seanad Éireann to devise ways and means of creating employment, whether of the amenity type which is relatively short term and would cater for——

Mr. Lenihan: That is what he is supposed to be at.

Professor Quinlan: I would be happy, despite many other commitments, to devote some time in the next few months to such a task and I know many others would be happy to do the same.

Mr. Lenihan: That is what he is supposed to be at.

Professor Quinlan: The Minister cannot do the work of 50 men and that is what he is trying to do at the moment. As Senator Lenihan knows, when he was a Minister he was hard pressed and he did not have EEC duties imposed on his ministerial duties.

Mr. Yeats: He did. He was negotiating.

Professor Quinlan: Turning very briefly to the health services, we can [1466] only be alarmed at the increases in costs and the cutbacks which have to be made. Cutbacks have to be made because the money is not there. The primary source has been identified, that is, the cost of medicines. These costs have to be cut. We have only to compare the money spent on private patients and the money spent on public health patients. Much more is spent on public health patients because they are not paying the bill, whereas, private patients are. In short, the time has come to bring realism into the field of health and to impose a small fee per prescription. That is the only way of putting a value on a prescription. By such means it should be possible to cut the present medicines bill which stands at £15 million to at least half that amount. Most medicines are manufactured outside the country. They do not even have the merit of generating employment here. They are almost 100 per cent imports.

The time has also come to take a realistic look at the need for family planning. We must realise before it is too late that the failure of pills and devices is being widely recognised in America and elsewhere. Therefore, we should not regard them as a solution. There are in operation in many places here natural family planning methods based on the work of Billings in Australia, and on developments here and elsewhere, which provide the answer. This answer will not cost the Exchequer any great sum of money, which is a vital consideration. These methods are in full conformity with our national moral standards and the general aspirations of the people. I suggest that the Department of Health should look into this matter.

There have been some big developments in education. I am glad to see principles are being highlighted. I should like to compliment the Minister for Education on his insistence on principles. I am very happy to endorse wholeheartedly the principles he has been enunciating. We are fortunate at this stage to have a Minister for Education who is fully in our Irish tradition. For quite a while we [1467] have been looking for a final blueprint for the university system. I expect we will get that in the coming year. There have been delays but, at the end of the day, the wait will have been worth while.

The Government decision of December, 1974, stated that they would not have a binary system, but as far as possible a comprehensive system. Secondly, the Government want the award of diplomas and degrees to be made by separate bodies. That has been shown to be a very wise decision. After the teething troubles experienced over the past six or seven months, the system is now firmly established. More important, the universities have been brought at a very quick pace to recognise the place of skills in third level education and training. In other words, the universities have accepted—I congratulate them on it—the comprehensive approach. They have accepted, as in American universities, that what matters is that the course makes adequate demands on the pupil, that it is properly planned and follows logically the previous training. At last we are getting into a situation where all can co-operate satisfactorily. I look forward to the final blueprint which will rationalise it. That final blueprint will be accepted unanimously.

Mr. Lenihan: We started that ten years ago.

Professor Quinlan: It will have to be changed from the December, 1974, blueprint in which some centres were labelled as being independent and others were labelled as being dependent or part of a constituent university. With the happenings of the past year, such differentiation is no longer necessary. We should have one umbrella-type university, the University of Ireland, in which all will be constituent colleges, in which the degree of “independence” will be no more and no less than the Government were prepared to concede to the “supposedly” independent institutions in UCD and in TCD. Independence means very little today [1468] when a person has to go cap in hand to the body with the money, the HEA. The HEA are a worth-while development and are doing a worth-while job. After the turmoil, the time is now ripe to come forward with a blueprint. We hope to see it within the next year. It will give the third level a place and a role for all.

In other words, I do not see NIHE or Ballymun staying in any subservient status. They are constituents of whatever is established, the same as every other group. Likewise, there is no limit on the studies that they carry out except that the public want for them and what the country needs from the graduates that are turned out by the system. These are the only constraints that should operate. So I look forward with enthusiasm and confidence to the developments of the next year or two in higher education.

I now wish to refer briefly to agriculture and to the latest EEC position as outlined yesterday by the Taoiseach and the Minister for Finance, this hope of what we call better efforts to see a convergence of economic policies. I thought that was a lovely phrase, “convergence of economic policies”. What is meant, I hope, is a transfer of resources from the better-off to the less-well-off areas. In other words, it is some step, belated and tardy but a step, nevertheless, towards recognising what was written into the Treaty of Rome almost 15 years ago about the concern for promoting the welfare of all.

This is of particular importance to us at the moment in our efforts to develop. I want to refer to it in the context of our agriculture, because the acid test of this is how our agriculture is going to be treated by the EEC. There have been pronouncements recently by the Commissioner for Agriculture, M. Lardinois, on the question of a milk mountain and on quotas or taxes to reduce that. While we can see the necessity for this in the global sense, as there appears to be a surplus, I have a healthy distrust for all economic statistics. Our past experience has been that any time a mountain appeared it was felt that was the time to get into that line. A [1469] mountain of milk appeared about three years ago. I do not know where it went, but it suddenly vanished into thin air, and lo and behold, we were told beef could not be supplied in 1973, and all efforts had to be geared, all moneys had to be spent, to put our resources into beef production, as there was to be a scarcity of red meat for evermore in the world. What has happened? I have never got a satisfactory answer to it, but within a year there was a beef mountain, and within a year and a half there was a ship floating in Bantry Bay carrying some of that mountain. I am just as sceptical about this question of the butter mountain which, they say, is threatening at the moment. All this could be overcome if every member in the Community took five or six ponds of butter per head.

Be that as it may, let us carefully examine our situation in that regard in the light of the declared policy of the EEC. If we reduce our milk output in accordance with that, what do we get into? Surely not into beef. One only has to look at the Australian situation today with beef at giveaway prices to realise that on a world scale there does not seem to be any prospect of any shortage of beef. If not into beef, what de we get into? The lifeline of this country is, as the Minister for Agriculture and Fisheries has rightly stressed, the dairying industry. It is there that our resources of men and land can be employed to get the maximum production. We must see that, first, the directive seeks to raise standards, transferring resources. Resources are not being transferred here but a resource we have must be allowed to develop. If there is overproduction in milk, what will be the yardstick of the EEC economists? They talk about producing milk in the best possible locations. The best possible means of producing milk is from grass and that is where this country is ahead of anywhere else. If it is necessary to cut milk production, what must be cut is the expensive input of feeding stuffs for the continental cow, the one we hear extolled because its average is almost twice that of our cows. But it is a very [1470] expensive milk that is produced by that method. If Europe is rational and economic in approaching that, what it does is cut the output based on expensive foodstuffs and concentrate on grass production. In short, our special position there must be recognised.

There is another side to it. European policy must be a maximisation of resources, getting the most from what we have. In that context there is the fact that for 25 years after the last war we in Ireland were the victims of the cheap food policy in Britain. Britain took in the agricultural surpluses from all over the world, dropped the prices, subsidised the producers at home and we got completely uneconomic prices which, at that time, were less than half of those prevailing on the continent. The result was that while continental agriculture, under the impact of modern agricultural technology, and British agriculture, helped by its subsidies, expanded at 4 per cent to 4½ per cent per annum from 1945 to 1970, ours expanded less than 1 per cent because we had no markets, no prices. Our land was more than capable of it. There was nothing wrong with our stock, but we were just denied those opportunities. It is up to the Government in their contracts with the EEC and elsewhere to insist on the recognition of that primary fact. Quotas for us begin when we catch up with Europe and with what we could not do because of the force of economic circumstances in the 20 years before 1950. That is our first claim. Our second claim is based on the maximum utilisation of our resources.

Also let us get away from this defeatist talk about 9,000 a year leaving agriculture. All those are leaving in coffins because that is the death rate in our agricultural community. What is wrong is that the policy of recruitment of young people into agriculture has not yet been faced. If we look for employment for our young people, then a healthy and a progressive recruitment into agriculture, and also not necessarily directly into agriculture, is surely one of the obvious ways [1471] and openings that will be available in the years ahead. There is an impediment there in that one man working directly for another is not something that commends itself very much to the modern worker. However, those self-same services can be provided on a co-operative basis, and therefore let the co-operative centres have their relief services which will supply those same services. A worker much prefers to be working for a co-operative rather than for an individual firm and he has greater stability in this. If we are looking for employment opportunities, agriculture is one of the best sources we have.

Let us take 1,000 acres in Europe, in Denmark, Holland or France, where the farmers are engaged in dairying activity comparable with ours. You will find we have proportionately less than half the manpower engaged in ours. All right, the output may be around half also, but if we are to step up output it means we must step up the factors that create output. We must step up manpower. Our agricultural advisory service is doing a good job on technical knowhow and can do more. We must step up capital investment. In the years ahead the main target should be to get rid of the bad farmers who are not using the land; to get them out of agriculture, to help those on the land who are developing it, to get the capital. In Mr. James Callaghan's dictum, the profits of today are the jobs of tomorrow. The same applies in agriculture. Let us get the capital, provided it is ploughed back in. We have to catch up on 20 years of—I will not say neglect—servitude under Britain's cheap food policy. If the country is really to improve it cannot do it without the maximum contribution from agriculture. All sections have to make their contribution, and are making it, but without the agricultural contribution we will not succeed.

I do not wish to take up further time except to say that this type of general debate is very valuable but it is no substitute for an adequate committee system. If we are to modernise [1472] let us get down to it and put the committees first.

Mr. Ferris: I will be very brief because there are still quite a few people offering to speak, especially my colleague Senator Ruairí Quinn who wishes to make his maiden speech today. I hope that the House and particularly the Minister before he replies, might facilitate him so that everybody will have had an opportunity of having an input into this Appropriation Bill which gives many of us the opportunity to discuss policy relevant to the fields which we represent and relative to the areas in which we serve.

The Minister in presenting this Bill set out the magnitude of the problem of financing the State enterprise in the sum of £1,693 million. This sum, although it includes additional Estimates for last year which amounted to £171 million, puts an appropriation figure before us today of £1,521 million, and if we break this figure down further we have £174 million odd for capital services and other services amounting to £1,347 million.

To make my contribution as brief as possible I will deal with the capital service programme. My colleague, Senator Harte, had a wide-ranging contribution which dealt with other aspects of the Appropriation Bill. To avoid duplication I will briefly mention two or three items in which I have a particular interest. One is the AnCO training programme which I consider most significant; another is the IDA programme of job assistance for industrialists, not alone in Ireland but from abroad, to set up in this country. I would like to see more liaison between the IDA and Fóir Teoranta, which is the body set up by the Minister for the purpose of retaining jobs in existing industries. In my area there is a company named Leidersdorff which currently requests and requires this assistance from Fóir Teoranta and I hope that the Minister, who is personally aware of this, can persuade that body, which has the capital available, to assist them. It is important to ensure that jobs which can be retained are retained.

[1473] The capital service programme covers a wide field. I could deal with P & T which, in spite of its tremendous capital injection of over £19 million as set out in the Book of Estimates this year, is an area in which there is still a tremendous demand for telephonic services. If one considers the use that is made of telephones in modern communications it must be realised that in this area there would be an immediate benefit to the Exchequer in the service and use of telephonic communications. We would hope that the progress made in P & T under the present Minister would continue and that additional funds when available would be earmarked for this purpose.

The area that I would like to deal with particularly has been referred to by other Senators, that is the local authorities and health boards. Taking into account the unemployment situation, this is the area of the greatest need for a continuing injection of increased funds. These funds of course would stimulate employment very quickly with the resulting spin-off effects for our economy, thus creating immediately an improvement in our unemployment figures, improved consumer demand in rural areas and at local level, the tax revenue buoyancy that would accrue to central funds, and the removal of the necessity of social welfare payments which in this field run to well over £100 million a year currently. This would satisfy the general and real desire of people to be gainfully employed particularly in their own locality on work such as sanitary services, water and sewerage schemes, construction work and amenity projects, with particular reference to the employment of school leavers and such rural schemes as would give tremendous employment at local level, such as land drainage and so on.

It is fair to say that in all these areas over the past three years this Government have been generous in their allocation. I could mention specifically—and it has been referred to by Senator Ryan and Senator Kilbride this morning—the area of the local government housing programme [1474] under which over the years, not alone in one year as was mentioned by Senator Ryan, but in all the years in which the Coalition have been in office the number of houses provided has been more than 25,000 per annum. In addition to that, the capital housing programme totalled some £80 million last year, almost double the previous contribution from the Opposition when they were in power. As well we have 100 per cent grants for secondary roads which is an improvement on the Fianna Fáil programme of 50 per cent grants in the same field.

In the health capital programme the additional beds which have been provided since this Government took office have been 400 beds in the general hospitals, 900 beds in the psychiatric hospitals, 300 beds in the homes for the old aged and 160 beds in the deaf and blind hospitals, a total of 1,760 additional beds. This is progress and we would like a continuation of this capital input into these fields. We hope, like Senator Quinlan said, like all Governments have hoped, for a continuing boom in the economy, that this kind of progress would continue. At local level we have schemes at advanced stages of planning at all levels for a continuation of this progress. We had hoped that in 1976 this would continue but these plans are in themselves an investment because they will ensure that when moneys become available all local authorities, health boards and other statutory bodies, will be ready to proceed again.

This brings me to the point which I have been trying to make, that the greatest opportunity in the short-term for an improvement in our unemployment figure lies in capital investment at local level where the machinery is geared to continue this progress, with all the advantages to the economy which I have already spelled out.

As we know in 1976, we have the aftermath of the 1975 western world depression, which the Minister referred to in his speech, a depression which has affected all EEC economies and one in which Ireland [1475] as a small nation has suffered more than most because we are an open economy subject to tremendous competition from our external trading partners who have had years of industrial activity and experience compared to our sheltered position in industry. We now have to face the broader and more ruthless world of free trade and a myriad of imports from cheap-labour countries.

This type of challenge which EEC membership inevitably brought upon us, coupled with the fuel crisis, which we all admit has taken place and which so affected our balance of payments and the necessity for greater borrowing, have forced many new capital starts due to be postponed in 1976. There is, of course, a continuation of this massive injection of capital for capital continuation in the field, but new starts, unfortunately, have had to be curtailed. When we consider that at local level this had meant the possibility of our workers not being adequately employed at the end of the year, this creates an immediate prospect for some of them and we are all charged with the responsibility to ensure that there is an immediate injection of funds, somewhere in the region of £100 million, which can only be found in the usual ways, either by increased taxation or additional borrowing.

Mr. Lenihan: Hear, hear.

Mr. Ferris: We are all agreed that additional taxation, particularly through PAYE, must be avoided at all costs as this maligned section of the community who are at present paying more than 85 per cent of all taxation must not be expected to continue forever footing the bill while other sections continue relatively tax free. It must not be demanded from them.

In this regard the Minister for Finance must be complimented on his continuing effort to spread the burden more equitably across society. I sincerely hope that representatives of tax-free sections would look at their social commitments to others in [1476] the community when any proposals of even nominal contributions from them in the form of taxation are made by this Government.

If taxation under the PAYE system is undesirable, we must look at the question of borrowing. The Opposition have condemned our policies in this field. Having regard to our commitments in the social field, they must concede that if we had not borrowed the increased unemployment over and above the unacceptable levels we have at the moment and its resulting effects of the people would have been disastrous. There must also be a limit to borrowing at the level at which we have been trying to endeavour to maintain our standards, particularly at foreign level and on other monetary markets in the world where interest rates and conditions are very stringent and restrictive in nature. We must look to borrowing from within our own resources.

Banks were referred to by Senator Harte this morning when he said that they were arm-twisting. Most of us would be more strict on them than just to say they were arm-twisting. I realise that although commercial banking contributes a major amount to our national loans and otherwise, unfortunately they do not play a full part in our economic life. We understand that they have ample funds available which, unfortunately, the private sector has not availed of in spite of being coaxed by the banking enterprises to do so.

If private enterprise does not avail of the funds which are available within our own shores, we as legislators and as a Government should give first preference for this surplus cash to use in the manner I have outlined. This money could be borrowed at nearly nominal interest rates in the nation's interest. The banks, who because of the large profits that they have made are an embarrassment to themselves and when their staffs, look for their share of what is now being treated in the country as bordering on loot, the banks are unable to claim, as indeed other employers have been forced to claim, inability to pay their staffs. We, as legislators, should [1477] appeal to the banks to consider giving a national lead.

Other alternatives are available to us but it would be a rather drastic step in a period of economic crisis to adopt any other steps than these. The Tánaiste, in his address to the annual conference last year——

Mr. Lenihan: Last year?

Mr. Ferris: ——indicated that the budget would possibly be the most serious and difficult in peace time. We must remember that in war times, particularly in Britain, special emergency bonds were issued to the people, who responded at that time to the national cause. I feel that emergency bonds might now be a gesture to the investing public interested in the future economic growth of our country.

Our economic growth also depends on industrial stability, about which many things have been said in recent months and to which the powerful trade union movement, referred to by the Taoiseach as our social partners, have a great responsibility to play, a responsibility which in economic difficulties is even greater and more difficult to achieve. I would hope in this difficult situation, when we have a social and economic plan prepared, that this union involvement will have a look at the areas outside wage increases only, whether these wage increases are fought for and demanded or whether they are agreed at national level. I feel that the trade union movement, as happened in Britain, will answer the call and would look to other areas of compensation for their workers especially in the field of tax relief and other productivity incentives which would not out-price our commodities in outside markets to the detriment of our balance of payments.

The success of savings schemes should lead one to consider that awards of sums towards savings in lieu of cash increases could be considered. If we examine the vast sums being spent out of wages on non-essential items, one wonders what real value is put on money any more. As savings [1478] are growing, the trade union movement should look at this field as a possible recompense for their members.

The Minister referred to the drop in building, not in local authority or house building, but other forms of building. He referred to the 6 per cent drop in building output. This is an area of very high employment which, because it uses materials which are not generally imported, is of most benefit to the community. I ask the Minister to consider extending the PEP scheme to the construction industry where there would be direct benefits to the unemployment situation and to the economy.

I welcome the Minister's reference to improvements in our external payments position in which agriculture played a most important role. Tourism also plays an important role. This is an area of tremendous potential which now has to overcome this violence which is upon us all, a violence which has hit the centre of Dublin again today, we hope with no loss of life. With this continuing violence in our midst which can hit at tourism more than anything else, and with our assets, hospitality, friendship and value for money that tourism can give, I hope we can overcome the problem of the terrorists. Any action the Government need to take in the treatment of terrorists should have support from all sides of this House.

These improvements, added to future prospects from our mineral resources—as we were informed in the recent Gas Bill which was an enabling Bill to set up a proper board —are, as was intimated in the Seanad on Second Stage of that Bill, on 7th July, of great importance to this country. The setting up of this gas board will ensure 2,000 jobs and an improvement of £75 million a year to our balance of payments. This is the kind of prosperity we can get from our natural resources. It should give us courage and confidence for the future financial security for this island which is struggling for survival with out larger and more powerful partners in the EEC Community, a survival which calls for restraint in [1479] our demands for services. If we demand these services we must be prepared to make sacrifices in personal gains. I have the utmost confidence in the Minister and in the policies he has adopted in trying to strike a happy medium between taxation and borrowing and the provision of services.

Senator Lenihan and Senator McCartin rose.

Mr. Lenihan: Senator McCartin expressed a wish to speak so I shall be very brief indeed.

Acting Chairman (Mr. Brosnahan): I am following the usual procedure in calling on the other side of the House.

Mr. Lenihan: I want to address my remarks to the credibility of Government utterances these days. Senator W. Ryan this morning commented on the credibility of the Parliamentary Secretary to the Minister for Social Welfare in regard to what he said about the old age pensions situation, which was totally at variance with the actuality of the situation. The same situation arose in regard to the Minister for Finance. Fundamentally, one of the major problems we have in Ireland today is the fact that there is no credibility in the Government's financial and economic policies. I suggest that it is time the Government and the Minister came clean with the people. It is not enough to have Senators Ferris and Harte making their Labour Party speeches here when most trade unionists know that we and James Connolly think the same way. It is time we had some justice in the Irish situation vis-a-vis the public at large. Justice means telling the people exactly what is the score. I cannot put it in plainer parliamentary language than that. This Government composed of the Parliamentary Labour Party and the Fine Gael Party are grievously wrong and are doing a very grave injustice to the Irish public in not telling them the score.

I do not want to use the word “falsehood” or call people liars; that is not my form. I like to produce the [1480] facts. My colleague, Senator Yeats, in his opening speech on the Appropriation Bill, specified and was rebutted by the Minister for Finance with regard to the EEC approach to our handling of our financial affairs.

I specified to the Taoiseach yesterday, and again want to write into the record the reply given by Mr. Gundelach, the Commissioner responsible, to a question I asked in the European Parliament last Wednesday. I got a written reply because the question was not reached. I shall quote it in detail from the report of the European Parliament of 7th July, 1976:

Question by Mr. Lenihan: Subject: Irish economic position within the Community.

In view of the Irish Government's failure to obtain a wages agreement satisfactory to European Commission and in view of Ireland's handling of the consequence of the implementation of equal pay, what measures does the Commission propose following its study of the Irish economy to improve Ireland's economic standing within the Community?

Answer:

Recommendations and suggestions concerning the Irish economy are put forward by the Commission for the benefit of Ireland itself and not in order to satisfy the Commission or any other institution.

Mr. R. Ryan: That is very important.

Mr. Lenihan: It continues:

The Commission in its recent quarterly report suggested that the basic problem facing the Irish economy was a choice between more employment or higher nominal wages for those presently at work. While the implementation of equal pay for women has had a certain upward effect on wage rates in some particular industries it is not felt that its impact on the national wage bill as a whole has been substantial.

In the latest Communication to the Council on economic policy to be followed in 1976 and in the [1481] budgets for 1977, the Commission recommended that Irish budgetary policy in 1977 should aim, in conjunction with an appropriate incomes and prices policy at a strict limitation on salaries, social transfers and other current expenditure together with possibly a modest increase in taxation.

These guidelines are in line with those approved by the Council when fixing the conditions for economic policy in connection with the Community loan to Ireland. This loan demonstrates the Community's willingness to alleviate the Irish short term economic problems.

If some guidelines will not be followed—here I am specially thinking of the pledge for an incomes and prices policy—other measures will need to be adopted, if not employment and the balance of payments shall be jeopardised.

The Community has and will in future by way of loans and subsidies contribute to solving structural problems in Ireland. The Commission is presently together with the Irish authority studying the problems in order to fix priorities for the financial assistance.

What that means in effect in plain man's language is that this Government have to put their house in order. They are the realities of the reply given to me by Mr. Gundelach, last Wednesday. My colleague, Senator Yeats, raised this matter yesterday in the House and was told by the Minister for Finance that in effect he was telling lies. These are the credible facts. The Parliamentary Secretary to the Minister for Social Welfare and the Minister for Finance, who is in a far more important and sensitive area of the Administration, know well and everybody here knows well, this is just not on today with the Irish public. The sooner there is a realistic appraisal of this whole economic situation here and the sooner the Government charged with the democratic responsibility of ensuring that we can survive as an economic entity recognise that the [1482] better, because otherwise it is a total job of “conmanship”. I feel very sorry as a person involved in the welfare of the Community and the economic development of our country that this should happen, because I believe passionately in what James Connolly said; I believe passionately in what Pádraig Pearse said; and I believe that we can handle a united Ireland under our own steam. I feel very sad at this situation in our history, that we do not have political leadership because fundamentally the money is there and the credits are there, the political leadership is there. That is precisely what is written into that EEC reply to my question last week. The Minister is well aware that unless the required leadership is given we will not get the credits or the facilities. We will get the credits, and the facilities because fundamentally this economy is sound provided that the political leadership of this country is sound, and provided there is a degree of patriotic instinct written into political leadership and the right appeal is made to our people. Europe is a Community which can provide us with the aid needed to get us off the ground but it will not respond unless we give the lead ourselves. It is a matter for ourselves and on that basis I would like to say in conclusion that the responsibility is squarely with the Government on this issue. If they do not want to face up to that responsibility then it is a question of their getting out smartly and definitely.

Acting Chairman (Mr. Brosnahan): I would like to point out that by arrangement the Minister is due in at 4 o'clock. This leaves 30 minutes for three speakers.

Mr. McCartin: It is unfortunate that this has to happen. I appreciate very much that Senator Lenihan was aware of our position and that we had waited. I think Senator William Ryan made a very useful suggestion early on. In future I think we should re-order debates such as this, so that a fairer opportunity might be given to everybody to express his views.

On the subject of economics a feeling has developed lately that if you can get a hold of economic [1483] jargon, put a few coherent words together and stand up and make weighty pronouncements on how to solve our economic problems, you are giving advice, you are pointing out the direction and you are regarded as a person of substance who understands the implications of high finance. To my mind there is no such thing as high finance. If you know how to add two and two you know how to add a million and a million. Far too many people stand up to make weighty pronouncements on the whole economy, international finance and so on, without the remotest understanding of what the nuts and bolts of the real machine are, or how the real machine is put together and what the really important things are.

We have had some very useful, honest and what I call honourable respectable contributions made in this debate. Some people, of course, got a hold of the economic jargon, and tried to put it across that they had made a study of the problem.

On this side of the House I did not stand up to come to the assistance of the Minister for Finance, Deputy Richie Ryan, whom Senator Quinlan said is doing the job that 50 men might do and be busy. I realise that, and when the Minister stands up and is forthright and honest he is accused of being arrogant. When the Minister comes with humility and respectability he is accused of begging for mercy. This is the sort of attitude from the other side of the House, but I know that the Minister is bearing up to the responsibilities of 50 men and that he is not and has not, and has no intention of requesting that the chalice pass away and that he will carry the cross all the way to the top of the hill. I am convinced about that, and I am not standing up here to flatter him or anything like that. I have a couple of small points that I would like to make and which I consider to be important.

The agricultural industry is our most important industry and is not getting the consideration that it deserves, not from the Government, but [1484] from the people. I do not believe that the politicians control the destiny of the Irish economy the way they are often given credit for. There is a lot to be said for the old saying that politicians only deal with the things that finance leaves after it. Finance today means employers and workers. It is by co-operation and understanding of each other's positions, and a willingness on the part of both to make the necessary sacrifice, that we can have progress. If that willingness is not there a Minister or a Government however strong cannot impose their will on a people who wish to spend more money than they are prepared to work for.

In connection with agriculture, the question of tax has come up. Tax on agriculture always comes up and it is always talked about from an entirely wrong point of view, from the point of view that the farmers are so well off that they ought to pay tax along with everybody else. This is not in accordance with the facts. I never hear of people who make such statements going into the facts and finding out from the people who have studied the situation or getting the figures of actual farm incomes and talking in accordance with the true facts and figures which are available. According to the Agricultural Institute, the average farmer with 11 cows has an income of something less than £30 a week. Most of these farmers have a day's work done before most of the people in the public service even get up in the morning. That is the truth of the situation.

Tax on farmers was imposed and rightly so because it appeared that our taxation system was unjust and because if there is one farmer or one person in any walk of life, who makes a big income and is not taxed on it there is a situation that appears to be unjust. Sometimes good economic policy and justice clash. To my mind there was a clash here. It is bad economic policy to tax farmers but justice demanded for obvious reasons, that the Government had to make a move in that direction. I believe that before people accuse farmers of earning more and paying less than their [1485] share they should become conversant with the true facts.

The other point I would like to make is about the development of agriculture. It is shameful that we have so many people unemployed when we have a situation where the land is completely under-utilised, a farming community that have proven they are the one section of our economy that can produce at a competitive rate. They can sell cheaper than their competitors and are selling cheaper than their competitors. They are the one section of our economy, under the Second Programme for Economic Expansion, that reached their targets of production. In agriculture, as in no other field, we have the opportunity to solve many of the problems of the Irish people at present, and this should be realised. We produce about as much per man engaged in the agricultural industry as our competitors on the continent. It should also be remembered that it takes five people employed in the processing industry in Ireland to equal the production of one person on the continent. Here, again the farming community is being put at a severe disadvantage. On the other hand, if we could double our production we would naturally create a situation in which processing would become more economic.

What can we do for agriculture? I have tremendous confidence in the ability of the advisory service to guide agriculture nationally—and the individual farmers—along the right road. Recently, what is happening with the farm modernisation scheme is that far too many skilled agricultural advisers are spending too much time on paper work. This is to the detriment of the agricultural industry. Men who are so qualified should be advising farmers, working with them and making contact with them. While this might have been difficult to foresee a couple of years ago, it is a dangerous trend. We should also have more planning, not only from a national point of view; every agricultural committee should be required to put forward an agricultural development plan and agricultural advisers [1486] should go out from that committee with that plan in mind and with targets to be achieved, and should be able to answer at the end of the year whether targets had been achieved or not.

Farmers have not run out of cash for development. They may have, to some extent, run out of the will. It is a bad thing that so much has been made of wealth tax, tax on farmers and tax on co-operatives, because it has little relevance to the ordinary farmer except that he has become convinced by too many people saying it too often that if he produces more he will be paid less. That is not so. In spite of some taxation measures that have been introduced, I do not accept that there is anything to worry about from the average farmer's point of view. What is the average farmer lacking? I suppose the structure of our farming community, their age and so on is not ideal but there is no question about agricultural credit. Any farmer with a plan can get all the agricultural credit he requires. It was never easier. Never was a better service given by the Agricultural Credit Corporation to farmers than that given at the present time. There is no farmer with any worth-while plan who cannot get adequate finance from the Agricultural Credit Corporation. Therefore we cannot say that the Government have failed to provide the necessary finance to help farmers to develop their holdings. But we must admit that there is something lacking. I believe the right national development plan for agriculture could do a lot to help and if this was carried down to county committee level it could be a great help.

While speaking about the Agricultural Credit Corporation and the whole question of financing agriculture, a suggestion was made recently that we should have an agricultural bank, a farmers' bank. I have believed for a long time that the Agricultural Credit Corporation should extend its activities into banking and should fulfil the role that some of the leaders of the agricultural community have sought. If this is difficult or if [1487] the ACC see any difficulty about extending their role, it should be realised that what they are doing is taking the more risky business from the banks; they are allowing the banks the opportunity to capitalise and to make easy profit from the small depositors around the country, farmers who would and should deal with the ACC if they had the opportunity. There may be a case for the coming together of the semi-State body and the co-operatives and the people engaged in agriculture to start a good national bank that will serve the agricultural industry and be prepared when the need arises to take a limited risk which the banks are never prepared to do.

The National Coalition found much work to be done in the housing field and they found many people in substandard housing in overcrowded conditions. I am not talking about the lack of progress or the progress in the previous years. I am saying that there was a particular situation when the National Coalition came into power; they have built many houses and they have gone a long way toward solving the problems of housing. Nevertheless, we are coming to a stage when we must reflect on the fact that we have the highest proportion of young people in Europe under 15 and 16 years of age. How are these people to be housed? How are we housing them at the present time? They take jobs at 18 years of age; they decide to get married at 23 or 24 years. When they decide to get married they have not got a shilling in their pockets.

I know of a man who had a little two-roomed house to sell which was in an obvious place and in the past month about 20 young couples, who are getting married in the near future, wanted this house. They had spent five or six years spending every shilling they earned on clothes, on dancing, on drink and so on, and they demanded that this man should give them the house. He did not give it to them so they went to the county council. The county council are told that they have an obligation to house these people because they have no [1488] house and they are getting married. In spite of all the rights to which we say human beings are entitled, these people have no right to get married without having some plan as to where they will live, without having some savings made for their future family. We should adopt a new approach. We do not have to jump into it overnight but we must decide that if we are not going to make parasites and dependants out of all the citizens of Ireland we will have to give some incentive to young people to save.

The average county council house is costing £6,000 or £7,000 and that is for a house 780 to 820 square feet, a small little house, exclusive of the cost of the site. From my own experience, a young man about to get married can build his own house. The materials would cost him less than £2,000 and he could build it in his spare time in one year. I do not believe such a man is getting the aid he ought to get from the State. While the National Coalition have done a good job in housing, the time has come to rethink this situation. Better grants should be available to young people to provide their own houses. This is a long term solution to a problem that may arise if we are not careful. For every £1,000 that a young couple have saved, or for the first £1,000 the State should match it with another £1,000 grant. This would mean that every house would be provided at approximately 60 per cent of what it is costing at the present time. In addition, you will have an independent man living in that house, a man who knows he built his own house, and built it for his family and wife who will respect him the more for it. Furthermore, when the children come along, he will be more careful to ensure that they do not break the windows, that they do not scratch the doors, that they will look after that house, and that the council will not be saddled with the obligation to maintain it at a cost which will exceed the rates that would be payable on the house.

Mr. Lenihan: Hear, hear.

Mr. McCartin: We have many people to house in the next ten to [1489] 15 years and we will have to consider ways and means by which we will ask these young people to help themselves. I conclude by saying it is like the story of the grasshopper and the bee. The grasshopper sang and danced all summer and when the winter came he demanded that the bee should give him some of the honey that she had worked hard for in the summer. We have far too many young people singing and dancing their good years away and then they decide to get married and take on the obligation of life, they demand that I, or somebody else, provide them with houses. I believe strongly and firmly in what I am saying. I know the cost of building a house and I know that it can be built at half what it costs the average local authority. If there is £3,000 of a difference in the cost of a house, that is £150 a year for 20 years to a man who is a wage earner, and that is a lot of money. This is one way in which we could make it easier for people to live and give them self-respect.

The other matter I want to mention briefly is health. When I was canvassing recently—I do not have to say where it was—a young man of about 18 years of age shouted at me from a corner: “Get me a medical card and I'll vote for you”. He was a fine, healthy strong young man and I thought the whole thing shameful and we are partly to blame for that. The two-thirds of the population who have not got medical cards are using less drugs than the one-third who have them. The Government have done all they can be expected to do in present economic circumstances for the poorer and weaker sections of the community. I believe they have not done too much but, if they go so far that a young boy of 18 or 19 years of age, in the prime of health, can demand from a politician that he be given a medical card, it will not be very long before that young boy goes to a doctor for a medical certificate even though there is nothing the matter with him. That situation is there already. Telling young people of 16 or 17 years of age that they are entitled to medical cards is the wrong approach. We should wait until they become ill and [1490] then, if they are in need of attention but not able to pay their medical bills, we should consider the situation and see whether or not their medical bills should be paid. I heard recently of a person who jumped the doctor's queue and when the doctor saw him the person said: “There is not much wrong with me. Actually it is only sunburn on my nose”. That man was taking up the doctor's time unnecessarily. The doctor probably talked to him and gave him a prescription. That sort of situation should be corrected.

The Government have not gone too far in their assistance of the weak, the aged, the sick or the unemployed but they must be careful not to create a society in which far too many people become over-dependent. Young mothers with medical cards have only to hear children sneezing and they get their husbands to come home from work, take the car and go to the doctor, instead of asking the advice of their mothers or of some more experienced neighbour. As the Parliamentary Secretary to the Taoiseach said yesterday evening, people should be more self-reliant. If these mothers had to pay the doctor they would seek their mothers' advice or the advice of the woman next door. Theirs is not an intelligent approach because all this is causing wear and tear on social services which are the nuts and bolts of our economic situation. In the areas of health and housing we are shaping the type of country we will have in the future. I want a society which will be kind and charitable to the weak but I do not want a society constituted of lazy loafers, who will expect me or anybody else to work day and night, and then share with them when all they have been doing is drinking in the pub.

The public service generally has had a bad effect on the economy. I will explain what I mean by that. In recent years a situation has developed in which a man in an office decides that if he had two people working under him he would get promotion and, therefore, more people are brought in. I have seen this happening [1491] in the health boards, in the county councils and in Government Departments. The worst feature is not that we have a large number of people in the service but that these people have too little work to do. That is my honest opinion. In my own area a local enterprise will advertise for an employee and receive perhaps one application. If one clerk-typist is required in the North-Western Health Board, the interviews go on for two weeks because there are 1,200 applicants. There is, I admit, the question of security. They believe they will have an easy life, good pay plus the bonus of security of employment. This is making it very difficult for the average employer to get suitable personnel. The public service creams off the best because it can offer security. It does not matter if the ledger balances at the end of the day. They know they will get paid whether or not they do a day's work. In the private sector, the average employee is asked to work harder and take less. It is not the private employer who is to blame although I would not put him on a higher plane than the average worker. On the other hand, the public service has got more than its fair share while the private sector is made to look mean by comparison.

Senator Quinlan, referring to the EEC, used the nice phrase “convergence of economic policies”. To many people this means we should retain our free and easy style of life. It is all right for us to come in to work at 9 a.m. when, on the continent, they have already been several hours at work. Do we expect the Germans, who adopt a tough approach to life, to give up the standard of living they enjoy because of their hard work? If that is what is meant by “convergence of economic policies” then, if we want a free and easy life, we should be prepared to accept the lower standards of living that goes with that kind of attitude. Far too many people here regard the EEC as some sort of benevolent fund on which we can draw to cushion the effects of our own [1492] careless living. That is not how I regard it. We should go into the EEC as a free, independent nation, with a contribution to make. That is the approach of the Irish Government and any other idea should not be promoted because it would not be good for us as a nation.

After all is said and done, the Irish people have the control of the economy in their own hands. The Minister can give guidance and steer the people in particular directions at particular times. If, however, we insist on going downhill, the Minister, the Taoiseach and the rest of the Cabinet, even if they worked twice as hard, will not be able to save us from ourselves.

Mr. Brosnahan: I regret very much taking up some of the time left as I am very anxious that the newly-elected Senator should be given an opportunity of making his speech, but I hope to say what I have to say in a couple of minutes. I could not let this opportunity pass without referring to the recent NESC report on educational expenditure. In paragraph 37 it stated that:

The educational system has an extremely important role to play in the educational development of the people and therefore of society. It is therefore essential that there should be coherent educational objectives.

I should like to point out, as a representative of a teacher's organisation, that we concur with this point of view. As a matter of fact, the record of Appropriation Bill debates down the years places me on record as saying the same thing. I repeat that education is a basic service and, the efficiency of all services above that basic service could be impaired if the basic service is faulty. The most fundamental service in any community is the education service and standards of efficiency, standards generally in agriculture, in industry, in commerce, in literature, in science, and so on, all depend upon the basic fundamental standards in education. The report asked for coherent objectives. It has also been pointed out down the years [1493] that our educational scheme has been totally untidy. The various levels stem from forces operating at different times: 1831, the National Board of Education; 1879, the Intermediate Board of Education; 1900, the Department of Technical Education and Agricultural Instruction which afterwards gave rise to the Vocational Educational Act, 1930. Here are the two levels of education, primary and post-primary, lying about in a most untidy fashion without any coherence between them. Now the National Economic and Social Council call for coherent objectives which should have been obvious to people down the years.

There has been a tremendous loss of educational power and force over the years because of the lack of cohesion between the various branches which we call a system of education. When one speaks of a system one thinks of something that is planned and systematised. But this has never been planned or systematised. There are branches of education without any coherence between them, without any overall plan. The time has come at last for somebody to speak up at the level of the National Education and Social Council to highlight this fact, something which has been referred to by representative teachers' organisations throughout the years.

Not alone has there been a loss of educational power but I believe that if the matter was actuarially examined it would be found that there has been a tremendous loss of money particularly in the post-primary area where there is absolute overlap and confusion. We have secondary schools, regional colleges, higher community schools, comprehensive schools, regional colleges, higher technical colleges and so on. There is no coherence particularly in the post-primary sector. There is a lack of integration and alignment between the primary and post-primary sectors. This has not been planned. I understand that there are children roaming the street—particularly since the raising of the school leaving age to 15 years—not in any school and which [1494] leads to a considerable amount of vandalism. There are thousands of children, particularly in the north city and north county areas, leaving primary schools who cannot get a place in a post-primary school. This creates tremendous problems. Not alone is a child not in a position to be advised to enter a certain type of occupation or form of employment but he is lucky if he even gets inside the door of the post-primary school, making nonsense of our high-falutin' talk about vocational guidance.

One of the recommendations of the report says that increased expenditure is needed for education for compulsory age group. This is true. There is still a lack of facilities for the compulsory age group—in other words, those up to 15 years of age. There is a lack of educational aids, educational equipment, of facilities even in school buildings and the physical surroundings. We still have rat-infested schools in this country. In a recent survey we asked one question: is your school rat-infested? One teacher replied that no decent rat would stay in this school. There are rat-infested schools and schools without proper sanitation. Recommendation No. 2 referred to long-term decisions with regard to the development of third-level education. Yes, there is a lack of places for pupils in post-primary schools. The report says also that there should be a significantly greater flow of information relating to all levels of education. This is part also of the lack of communication, the confusion that exists arising from lack of overall planning.

There should be a tidier approach to loans and grants. The time has come when, if loans rather than grants are made to students, they should be obliged to repay them when they enter a profession after leaving university. There are children who come from educationally disadvantaged areas. When these children enter the post-primary sector—due to the family background, home environment and so on—they are not in a position to benefit fully from the advantages open to them in that sector.

[1495] Minister for Finance (Mr. R. Ryan): I am grateful to the House for the manner in which they debated the Bill, even if I did not agree with all that was said. If I was to measure the criticism offered it was in much more muted tones this year compared with anything I previously heard. This, I suppose, is an indication that the Opposition, notwithstanding their public declarations to the contrary realise that the problems from which Ireland is suffering at present are due mainly to the global environment. That is not for one moment, of course, to say—they would not say and I would not allege—that many of our problems are not capable of being cured by our own actions. Several of our present difficulties are. We can certainly help to alleviate some of the troubles that have been created for us by the external environment.

Senator McCartin was quite right when he emphasised that in a democracy the will of the people is as necessary as government leadership. No matter how governments may strive to lead people in the right direction, if the people are unwilling to be lead in a way which secures their own salvation and improvement, they will have to suffer the consequences of their failure to respond to the correct leadership. It can be argued—as it is always argued in times of stress by those who are unwilling to follow—that the leadership which is being given is not sufficiently strong, is not sufficiently convincing; Senator Quinlan appealed for a Churchillian figure and form of leadership. I would remind Senator Quinlan and others who make this appeal, which I can perfectly understand, that Britain rejected Churchill's leadership for a long time. It was only in a time of distress and crisis that Britain accepted the leadership of a Churchill. Unfortunately, human experience in the past in all environments and all ages, indicates an unwillingness on the part of people to adopt a leader or to follow a leader of such qualities except in times of great distress. We earnestly hope that this country will not, [1496] through its omissions, bring about a situation where Draconian measures would be needed and where people in desperation, would look to a person who could and would have to dictate drastic remedies.

Senator Quinlan spoke of Churchillian leadership but he might recall that Churchill was called upon to lead only after other countries looked to and accepted leadership from disastrous dictators—Adolf Hitler and Benito Mussolini. It was a response to a situation—which, of course, no sane person in this country would want to occur—that the Churchillian form of leadership came to the fore. Certainly it did help to rally Britain in a time of very great need.

However, I should not dwell too long on these historical personalities. I want to deal with the affairs of today. But I accept the sincerity of what Senator Quinlan said. I would remind him that the Taoiseach went on television and radio and had the hospitality of the media last December when he spelled out precisely the economic realities facing this country. For the first time in the history of this State the Government gave the country the total figures of departmental Estimates, told the country the way in which those Estimates had already been cut—they were reduced by over £300 million at the time—and said it would be necessary to make further cuts in the demands being made for public expenditure. The Taoiseach made it clear that even at the end of all those cuts, it would be necessary to increase taxation by over £100 million. Nobody for one moment suggested that there should be further cuts in public expenditure. In the absence of a communal will to cut public expenditure, taxation must be raised to meet the expenditure which the community demands. That is true today. It was always true.

I should like to see every Member of this House use the vacation to which Senators are now looking forward by reading the Report on Public Expenditure recently issued by the National Economic and Social Council. I would make it compulsory [1497] reading for every citizen of this State if I had my way and if I was given the Draconian powers of Churchillian leadership—not something I personally want, by the way. This NESC paper points out the dangerous drift of public expenditure since 1961. Senator Lenihan had better not become too cocky because the report upon which it is based was on an earlier report prepared by Wiseman and Stafford at the request of the National Economic and Social Council which dealt with the drift in public expenditure from 1961 to 1973 when Fianna Fáil were in office. It shows the failure of government and people to accept the consequences of their own demands upon the Exchequer. Public revenue after all is no more that what people are prepared to pay to get services in return.

I do not want to make political party points on this because the issue of public expenditure in Ireland is too serious a matter for us to continue the old game of trying to score off one another. I accept that the drift in public expenditure which Wiseman and Stafford pointed out was moving dangerously between 1963 and 1972 has moved in an even more dangerous direction since then, albeit for reasons arising out of the worst global recession since the thirties. A great deal of the expenditure growth is a consequence of individual and communal demands for improved services which as Senator McCartin has pointed out people rush to avail of because at the time of receiving the service they make no payment for it. But of course nothing is free— nothing whatsoever provided by the Government. Be the services educational, medical, transport or security they all cost money. We are all paying for them in taxes and we will pay more and more to Government for existing services and any new services as long as we continue to make increasing demands and refuse to allow Government to withdraw anything. No plan, no matter how well prepared, no matter how well researched, is going to succeed unless [1498] the people have a will to see that it succeeds.

With regard to economic planning in Ireland, its concept and the work to put it into motion, originated in 1955 under a Government including the Fine Gael and Labour Parties, because it was in 1955 that the work began on the preparation of the first economic plan, which was published in 1958. It had a modest measure of success and that it all that can be said about it. The second plan never succeeded. It was so widely off course that it was difficult to conceive that the projections in the plan had any relevancies because the out-turn was so completely different. The third programme was still-born. The National Economic and Social Council——

Mr. Yeats: I thought the Minister did not accept their report.

Mr. R. Ryan: What I am describing is absolutely true and I am not condemning the Government of the day. I am just simply discussing the disappointing reality of what has happened in Ireland. It will happen again in relation to the plan which we are about to publish unless there is a will at all levels to eliminate such expenditures and policies and services as frustrate the achievement of the objectives of the plan. There are plenty of expenditures which popular opinion would resent being popular opinion would resent being withdrawn. But some of those services are not contributing to growth, to the provision of employment, to the provision of the means by which we can repay whatever we borrow, then enlargement of unproductive services could defeat the objective of the plan necessary in Ireland in 1976 and through to 1986—that is the provision of more jobs on a scale three times higher than we ever achieved in our best year in the past. It is a daunting and challenging task. I am afraid the attitudes and responses of all our people and all our institutions, including Government, Parliament, every department of the public service, have not yet matched up to the need.

[1499] Dr. Martin: Could I ask——

An Leas-Chathaoirleach: Senator Martin, no interruptions, please.

Dr. Martin: It is a very small point——

An Leas-Chathaoirleach: If it is a point of order, otherwise, no interruptions.

Dr. Martin: I appreciate the Minister's difficulty in this matter, but when has he spoken to the people——

An Leas-Chathaoirleach: The Senator is out of order. The Minister to continue replying to the debate.

Mr. R. Ryan: I have spoken on innumerable occasions. It has been said here that whenever I speak I am invariably criticised. Thank God for that. I would shudder to live in a society in which a ministerial pronouncement was not criticised, but I would suggest that the criticism ought to be self-criticism by each and every person and institution in our community, as well as criticism about us. Everybody else is not always to blame. Everybody has to share the responsibility for our shortcomings, just as we all glory in claiming a contribution towards any success which may have been achieved.

Professor Patrick Lynch, to whom I referred when I was making my opening statement, spoke on radio on Monday last with regard to planning. He is one who has been closely connected with economic planning; in fact, he was associated, I believe, with Dr. Whitaker in the preparation of the first plan and his contribution to economic growth in this country, both in the public and private service, is well-known and, as a country, we owe him a great debt. He said this, and it is very pertinent:

I believe that the reason why economic planning in the past failed was because the heads of other Departments, that is, heads of Departments other than the Department of Finance, were not committed to the concept of planning. Planning implies discipline and unless Government Departments conform [1500] with the discipline of a plan that plan cannot be successful. One of the paradoxes of modern Ireland is that in the course of executing such plans as we have done, the private sector conformed more fully to the discipline of a plan than Government Departments.

Mr. Lenihan: That is the Government's job.

Mr. R. Ryan: That is a damning indictment of government and I accept that Senator Lenihan regards it as an indictment of the Government of which he was a member.

Mr. Lenihan: That was more than three years ago.

Mr. R. Ryan: Chapter 6 of the Report on Public Expenditure by the National Economic and Social Council had something similar to say. It referred to the Second Programme for Economic Expansion and the Third Programme for Economic and Social Development. I want to quote from what the National Economic and Social Council have published. This, by the way, is one of the few reports of the council which represents the collective view of the council. This is not a report, like so many, that was published with various groups on the council expressing reservations. This is a Report of the National Economic and Social Council. I quote now from paragraph 6.2 in Chapter 6, where it says about the failure of the programmes:

The extent to which Government was committed to them was, at best, always ambiguous.

Senators will recall that Senator FitzGerald referred to this in his speech. It was pointed out that neither of these programmes was debated in Dáil Éireann—which is unfortunately true—nor in this House either, that neither of them seemed to be widely accepted in the public service as a framework for thought and action. Indeed, very little was heard of the Third Programme after it was published. That is a sorry history of economic planning in Ireland, of the lack of readiness of the institutions of [1501] State and of the community to accept the discipline of planning. There is no difficulty in publishing a plan. The difficulty is to get a response to the plan and that is something in which this country will have to engage itself at all levels in the next few months. A positive, self-critical, unselfish response will be necessary to achieve the economic health of this country to lead us through to 1986 without so much unemployment that social and political upheaval would be inevitable.

Mr. Lenihan: A bit of action——

Mr. R. Ryan: Senator Yeats said that the Government did not believe in planning. I pointed out that it is because we believe in planning that we will insist that the plan be properly prepared. The first economic plan, as we pointed out, took three years to prepare. With regard to the later ones I do not know what the scale of preparation was.

Mr. Lenihan: When is the plan coming out?

Mr. R. Ryan: When it came to the question of publishing a plan to replace the current one which expired in 1972 the Fianna Fáil Government decided to begin work on the preparation of the fourth plan in spring, 1972. They soon discovered that were they to publish the projections of the Department of Finance and the other advice available to the Government at that time it would have shown such a fall in growth, such an increase in public expenditure, such a growth in unemployment and such an unacceptable standard of living that it would have been a serious embarrassment to them.

Mr. Lenihan: When is the plan coming out? Is it mid-autumn?

Mr. R. Ryan: Many people wondered why in February, 1973, with the Government firmly in the saddle, with an ample majority and having won a by-election, they should have rushed to the country. The answer is simple. They knew what was coming up. They read the signs. They were given to them. They knew that, even if we had not got the depression of [1502] the last few years, there was an unpopular state of affairs ahead and they wanted to get to the country and possibly win the election so that they would have another four or five years in which to try to get the situation right.

Mr. Lenihan: That was the reason.

Mr. R. Ryan: That is it. We set about the preparation of a plan in 1973.

Mr. Lenihan: The Minister said that he did not agree with plans.

Mr. R. Ryan: I never said that.

Mr. Yeats: He said it over and over again.

Mr. R. Ryan: I never said that and Senator Yeats knows that well.

Mr. Yeats: The Minister said it was impossible to implement a plan and he had no intention of doing it.

A Senator: That is a pathological lie.

Mr. R. Ryan: That is quite a different thing to saying one does not agree with planning.

(Interruptions.)

Mr. Yeats: The Minister said he was not going to do it and now he says he was planning it all along.

An Leas-Chathaoirleach: Senator Yeats, the Minister must be allowed to reply to the debate without interruption.

Mr. R. Ryan: I do not believe in trying to walk on the waters. I do not believe in trying to do impossible things. When nobody was in a position to project with any accuracy what would happen in the wake of the oil crisis of 1973-74, I certainly was not going to put my name or ask the Government to put their name to a plan. I would ask the Seanad and the country to recall that the great experts of the world, those who believed in making projections, projected in the wake of the oil crisis that there would be massive deficits in all the western countries running right up to 1980 and that the OPEC countries [1503] would have so many billions and trillions of money surplus to their requirements that the western world would have to borrow it back. That has not happened. It began to happen but that terrible projection evaporated as quickly as it was made.

For instance, in Europe last year instead of all countries having the massive deficits that had been projected at the time of the oil crisis several countries, including our own, had historically low deficits and some were in fact, in surplus.

Mr. Lenihan: That was obvious. I said so.

Mr. R. Ryan: Everything is obvious in hindsight. Maybe Fianna Fáil are sorry that they did not have the gift of hindsight in February, 1973. They might not have run to the country to suffer the political upset which has put them in Opposition ever since and which will leave them in Opposition for many years to come.

Mr. Lenihan: The silly old chat has to go on.

Mr. R. Ryan: Senator Yeats, fulfilling the role of projector of doom, which appears to be the main policy of Fianna Fáil in Opposition, suggested that the balance of payments deficit in 1976 and in future years will get out of control again. We doubt that very much. Certainly it will not be on the level of last year. The reason for the balance of payments deficit of only £15 million last year was due to the fact that the recession led to a running down of stocks here and also to a considerable reduction in the amount of capital investment taking place.

That situation is changing. It began to change in the last quarter of 1975 and the improvement has been continuing since then. In the first five months of this year we have had a colossal increase in imports of capital goods for investment in manufacturing industry and also in raw materials for processing by manufacturing industry. This is the clearest indication of significant improvement in our economy.

[1504] Mr. Lenihan: That is a very important statement. Will the Minister be specific?

Mr. R. Ryan: It is a point of fact that we have turned the corner and that improvement is now assured.

Mr. Yeats: How much will the deficit be?

Mr. R. Ryan: Senator Yeats relied upon only one report of the Economic and Social Research Institute to support his projections of gloom. Against his quoted projection of the Economic and Social Research Institute, which anticipates a growth rate of only ½ per cent this year, the——

Mr. Yeats: And a balance of payments deficit of £200 million.

Mr. R. Ryan: ——document which members of Fianna Fáil and The Irish Press have been making reference to in recent days to conduct an argument which has no basis in fact and is nationally quite harmful shows a different picture. That document shows the EEC's growth projection of 3 per cent for Ireland for 1976. That is better than the 2 to 2¼ per cent of the Department of Finance. The Senators opposite may desire to be selective in what they quote but if they are relying upon the EEC to support their arguments——

Mr. Lenihan: On a point of order, I was not selective. I quoted in toto in regard to the particular reply to a question in the European Parliament.

An Leas-Chathaoirleach: Point of order taken.

Mr. R. Ryan: I was not referring to that particular document. It is only one of the documents. The one which has been referred to by Senator Yeats, and which was referred to in leading articles in The Irish Press, is a document containing this record number. I am putting it on the record that there will be no doubt about it: R/1637/76 (Fin. 435) and issued in Brussels on 2nd of July, 1976, and document number: R/1629/76 (Fin. 429) issued in Brussels on 30th June, 1976. These documents are most interesting. They show the EEC projections [1505] for Ireland as 3 per cent this year. The report of the Central Bank, shortly to be published, is forecasting a growth rate of 2 per cent this year.

That is it. There are a number of forecasts from reputable institutions. The Senators can take their pick. They might like to consider, however, that the Economic and Social Research Institute in the last seven years have been wrong by an average margin of 1.75 per cent to 2 per cent. Perhaps if the Senators top that on to their latest projection they may feel that the figures produced by others are valid. It would be wrong, I think, to rely upon one projection alone.

If one goes back over the years one will find that the most conscientious projectors vary their projections for different reasons. Sometimes they are right and sometimes they are wrong. I do not want to criticise the ESRI or belittle their efforts. I am sure that they are objective in the assessments they make but I am saying those who seek to be selective in what they quote really ought to look to the several institutions which are available to us and be guided by all and not merely by one.

I should like to pursue this question of whether or not the EEC is dictating our budgetary and financial policy. I am glad Senator Lenihan quoted the full reply which he received to his question in the European Parliament. I give him credit for quoting it in full. I quote a rather significant part of the reply so that the whole country can be aware of it:

Recommendations and suggestions concerning the Irish economy are put forward by the Commission for the benefit of Ireland itself and not in order to satisfy the Commission or any other institution.

The allegations made in The Irish Press yesterday——

Mr. Lenihan: I read the whole statement.

Mr. R. Ryan: Yes, the Senator did, I have acknowledged that. The attack made on the Government, and myself in particular, in yesterday's Irish Press, and renewed in today's Irish Press, was [1506] on the basis that the EEC was dictating policies to Ireland and that we would have to follow those policies in order to satisfy the European Commission and all institutions in Europe. There is the answer that was given to Senator Lenihan last week. It is on record in the European Parliament and now, thankfully, on record in the Seanad. It points out that no such dictation has been issued but that certain recommendations have been made by the Commission for the benefit of Ireland itself and not in order to satisfy——

Mr. Yeats: These are the conditions agreed to by the Minister in taking the loan.

Mr. R. Ryan: ——the Commission. Senator Yeats has given me the opportunity to put on record something that is already on record in Ireland. I must put it on record in order to show the conditions of Ireland's loan from the EEC. They are contained in a document issued by the European Commission last March. It states:

The loan granted to Ireland by decision 76/322/EEC shall be subject to the following conditions relating to the economic policy measures to be taken by that Member State: (a) Growth in the central government borrowing requirement, expressed as a percentage of gross national product, should be halted in 1976 and should be reduced in subsequent years; (b) Every effort should be made to finance the largest possible proportion of public sector borrowing requirements by non-monetary means, such as by placing long-term securities directly with the public; (c) The Irish authorities shall exercise the utmost caution to avoid any relaxation of its monetary policy for the purpose of meeting both the borrowing requirement of the Exchequer and the demand for credit in the private sector, were the latter to expand more rapidly than at present foreseen.

My budget statement of January last enunciated all those points as policies of the Irish Government, that the Irish Government were pledged to carry out [1507] those policies in the interests of Ireland. Subsequent to our declaration of those policy intentions the Community adopted the policy of the Irish Government as conditions appropriate to the loan which they issued.

To return to the document issued in Brussels on 2nd July, the Commission, far from expressing, as alleged by The Irish Press, dissatisfaction with the manner in which the Irish Government were complying with the conditions, acknowledged—I quote from paragraph 30—

The 1976 budget outturn of central government should show a net borrowing requirement a little less than the figure of £679 million originally forecast, this slight improvement being due to an increase in revenue exceeding the expected additional expenditure.

This improvement in public finances is in conformity with the conditions attached to the loan. We do not have to wait until 1977; we do not have to wait for the issue of a document from Brussels; we do not have to wait for a question to be put down in the European Parliament by Senator Lenihan in order to embarrass Ireland before the eyes of Europe; we do not have to wait for leading articles in The Irish Press; we are already moving in the direction which the Government announced last January as part and parcel of their financial policy. We shall continue that in 1977 and in the years to come.

The impression has been given that the European Community has directed some kind of chastisement to the Irish Government in relation to their conduct of affairs. I wish to point out that the document from which the quotation has been very selectively made by my critics issues recommendations on budgetary policy to the Community as a whole and to each of the member countries. I do not like having to quote this at such length but it is necessary to do it in order that some sense of balance shall be restored to public comment in Ireland upon the situation. In relation to Germany the [1508] Commission recommends—I suggest that these be compared with any recommendations which are issued in relation to Ireland:—

... a monetary policy which sets limits to nominal increases and a public finance policy which must endeavour to achieve a gradual reduction in the net borrowing requirements by restricting the growth of expenditure. Indeed, the second half of 1976 should see the introduction of a more restrictive line in expenditure policy...

The Commission is not issuing that recommendation merely for 1977 in relation to Germany. They say they should do it in the second half of 1976. With regard to social security in relation to Germany:

... the deficit is, if anything, likely to increase, so that efforts to economise in this sector should be pursued.

In relation to France it says:

... the main aim of economic policy should be to reduce significantly the rise in costs and prices using both direct means in terms of action on incomes and indirect means in terms of monetary policy and strict budget policy. ... the growth of central government expenditure should be reduced to a level close to the growth rate of GDP ... the financial position as regards social security, it could worsen and calls for action to keep it in balance.

Italy is advised to observe the conditions which were imposed in relation to the Community loan given to them. Those conditions set a ceiling in lire in relation to the size of the Italian budget and also specified the amount of additional taxation to be raised in Italy. It also gives directions in relation to tax evasion in Italy which was a serious cause of the erosion of public revenue. All that is repeated in the document from which selective quotations have been made by those whose only concern is to knock Ireland and its Government.

In relation to the Netherlands the EEC says:

[1509] Strict management at central government level is all the more necessary as the deterioration of local authority and social security finances is tending to increase...

For 1977, it is necessary to reduce the central government net borrowing requirement....This policy implies effective implementation of the provisions planned by the Government and presented to Parliament...

Now whose knuckles have been rapped as The Irish Press suggest? If my knuckles are rapped and are blue, then so are the knuckles of every Finance Minister of Europe.

In relation to Belgium it says:

For 1977, it is essential that determined action be continued... Furthermore, in the budgetary field, so as to offset as far as possible the probable worsening of the deficits of social security and local authority and some public undertakings and to avoid excessive tensions on the financial markets, efforts should be made to achieve a relative reduction in the central government net borrowing requirement through strict limitation of the real growth of current expenditure and transfer of payments. Similarly, energetic action should be undertaken to control the trend of social security benefits and the freedom of action of the local authorities so as to avoid any lasting damage to the financial structure of these sub-sectors...

The only country that has not recommendations which could be regarded as restrictive is Luxembourg. Of course Luxembourg has, as we know, the good fortune for a long time of being the healthiest member of the Community, from a financial point of view.

Mr. Lenihan: We are not on an ABC course.

Mr. R. Ryan: I do not have to quote what the Community would have to say about the United Kingdom because the United Kingdom is following a prudent policy in relation [1510] to public expenditure and on the incomes front. But it is recommended to continue to follow this policy and to have regard for the need for a substantial reduction in the public deficit and a further moderation of income growth. That is the European scene now. Is it not somewhat different from the rather biased one that was presented from the Opposition benches and by The Irish Press?

Mr. Yeats: These are not conditions. The Minister has bound himself by conditions.

Mr. R. Ryan: The recommendations to Ireland and to all other countries have exactly the same status and they have been issued in the words of Commissioner Gundelach replying to Senator Lenihan for the benefit of Ireland itself and not in order to satisfy the Commission or any other institution.

Mr. M.J. O'Higgins: And certainly not for party-political purposes here.

Mr. Lenihan: Let the issue lie.

Mr. R. Ryan: It is an indication of the worth of the Opposition contribution that the most passionate appeal was made I think by Senator Dolan. It was on this topic and I quote: “We should not always be suffering from imported politeness.” I do not know whether he wants us to put restrictions on the importation of politeness but we have a lot of problems without considering that to be one of them.

Senator Robinson wanted to know what we are doing by way of persuading Europe to give Ireland more help. Surely that is well known because at every meeting of the Council of Ministers we draw attention to the need for the Community to transfer resources from the better-off to the less-well-off members of the Community. Very shortly the Community will have before it a report of experts which points to the absolute necessity, if the Community is going to achieve any kind of economic and monetary union, for substantial increases in transfer of resources from the better-off to the less-well-off. The report [1511] says that what is needed in respect of Ireland is not the transfer of tens of millions of units of account but rather hundreds of millions of units of account. It is self-evident that Ireland's problems are very serious; they are what the Community calls “structural”. They are with us because of our natural position, our geographical location and the massive growth which we have ahead of us in our population and in the labour force during the next ten years.

I do not regard this as something that should frighten us. It is really wonderful that this country at long last has the necessity to provide more employment for more of its own people here at home. It is much better to be dealing with the problems of growth than to be dealing with the difficulties of recession.

Senator Killilea referred to the Sugar Company purchasing potatoes at £36 per ton and then selling them in the market at a higher price instead of using them in the plant at Tuam. I should like, therefore, to put on record what the position was in relation to the supply of potatoes to the plant in Tuam. Last year the Sugar Company contracted for the supply of 30,000 tons of potatoes. Subsequently prices rocketed on the open market. At the time of the contract a price of £24 per ton for potatoes delivered had been fixed and as it looked as if the Sugar Company were not going to get that amount at that price, later in the year discussions were held with the growers' representatives and it was decided to grant another £12 per ton on the contract price. Thus the total contract price was £36 per ton. The growers' representatives accepted this price and recommended to growers that they should fulfil their contracts.

Having agreed to pay the growers £36 per ton the Sugar Company found themselves in the position of receiving only 8,500 tons out of the required 30,000 tons. Notwithstanding the increase in the price, that was the disappointing result for the Sugar Company. Hence the whole economics for the potato operation were put in serious jeopardy. The company had [1512] contractual commitments for potato flakes which had to be honoured. They, therefore, processed a certain amount to hold part of the market. They also were obliged to buy flake from Canada to meet the requirements of another market and with the knowledge of the growers' representatives they sold 1,200 tons, on the ware market, 900 tons of which were sold in Dublin. The growers' representatives accepted this and they accepted it because they saw it as being in the long-term interests of the growers. If this should happen again, and it could happen in certain circumstances the growers will share in any profit which might be made by the Sugar Company in such an ad hoc arrangement. What happened last year was unusual but it can happen again with the fluctuations of the market. If it happens in future the profit will be shared between both the growers and the company.

Regarding the other aspects of the Senator's remarks in relation to the Sugar Company where he refers to agricultural machinery I want to say this: the agricultural machinery division of the Sugar Company is an excellent performer. It is one of the best parts of the company's overall performance. There is no lack of anxiety on the part of the company to increase the agricultural machinery division. They have concentrated their efforts on developing new lines in this area. They have run into a certain amount of opposition, however, which I hope it will be possible to overcome because it is a success story and the Senators and the country can be assured that the Sugar Company will encourage the agricultural machinery end of their business.

Senator Harte spoke with what was no doubt to him the embarrassing support of Senator Lenihan, about the need to twist the arms of banks in order to get more money from the banks for the Exchequer. Already, under existing arrangements, between 41 and 43 per cent of the increased resources of banks goes to the central authority. First, a certain amount has to be set aside to satisfy the requirements of the Central Bank; the [1513] liquidity ratio must be observed. This is in the interest of the depositors in banks and on top of that the liquidity ratios operated by the Central Bank ensure that 30 per cent of the resources of the associated banks are invested annually in Government securities and for the non-associated banks the figure is 10 per cent. In 1975 the Exchequer received £140 million from the commercial banks. That, incidentally, was about £50 million more than the banks were obliged to give so when people talk about twisting the arms of banks to get more money they ought to bear in mind that last year, indeed in most years, the banks tend to give the Government more than they are required to.

A consequence of taking more money from the banks, either because they give it voluntarily or because one twists their arms, is that one leaves the banks less money to lend to the private sector. Last year it was possible for the banks to exceed the basic requirement because there was a reluctance on the part of the private sector to borrow from banks. The worst possible thing in 1976-77, and in the year's growth is being renewed, would be for Government to make demands on the banks for more money and as a consequence deprive the private sector of capital which it would urgently require and could usefully use to expand capacity. We have certainly discouraged banks from lending money for non-productive purposes. In fact, there has been a reluctance on the part of many people to borrow money for any purposes during the years of the recession. We saw an extraordinary switch to savings so that the savings ratio multiplied out of all previous experience. Now we find ourselves in the situation of trying to encourage people to consume rather than to save in order to make a contribution towards growth. It is always very difficult to strike the right balance at the correct time but we are satisfied that the banks are making a contribution both to the Exchequer requirements and to private needs.

In addition to the money I mentioned which the banks advanced to the Exchequer last year, £140 million, they also gave £93 million towards [1514] the financing of intervention. Previously, it had been financed by Government but last year the commercial banks provided the money for the financing of the intervention agency. The Central Bank made £50 million available to the Exchequer and have stated that they will, if necessary, make a similar amount available this year. Last year the commercial banks made £283 million available to the Exchequer in various forms which was quite a significant contribution. As I said, I would not seek to twist their arms if the consequence of doing it was to restrict the necessary flow of money to finance private investment. Unfortunately, investment was sluggish last year and, in fact, it fell by 6 per cent. We expect that situation to improve and, therefore, the Exchequer should be making less demands upon banks and not making more.

I want to refute any suggestion that the Government have any difficulty in raising loans. They have not. But what is a difficulty, is for this country to increase the resources necessary to finance any loans which the Government might take up. The more we borrow now the more we will be committing resources which in future years could be used for growth to the repayment of moneys which we would be currently borrowing at a high rate of interest. I would not consider it appropriate, therefore, to increase foreign borrowing and I do not have to be told that by the EEC, or by anybody else. That has been Government policy since January of this year and we will not depart from that because it is necessary to follow that line in the interests of our people.

I made innumerable notes on the contributions of several Senators but time will not allow me to reply to them all. I hope they will understand that it is simply due to the lack of time and not to any discourtesy on my part. We have to get the Appropriation Bill passed before the House rises at 5 o'clock.

I should like to thank, once again, the House for the tenor of the debate. I accept, with a good grace, all the criticism that has been offered. At a [1515] recent meeting of Finance Ministers of the EEC they could not agree on anything except the proposition that there was never a worse time to be a Finance Minister. The Finance Minister in every country is a whipping boy. This applies not merely to countries in western Europe which have undergone the difficulties of the recession but it has also happened, and is happening, to Ministers in OPEC countries.

I had the privilege of visting OPEC countries over the last year and I found that a Minister for Finance there is equally unpopular as we are in Europe. Over there they were refusing to supply people with free electricity and refusing to abolish what were regarded as penal rates of tax, like 2 per cent on custom duties and so on. It is the lot of a Minister for Finance to be abused for not doing more, and it is a lonely post. Several Senators have been very gracious in their tributes to me. I do not deserve any of them. We are trying to do our best in a very difficult situation. We are trying to get co-operation. I believe the country is in the mood to give that co-operation. The plan which will be published shortly will form the basis of the co-operation which our country must give if it is to overcome its current difficulties and meet the great challenge of the next decade, a challenge which will be in total contrast with all our experience since the days of the Famine.

It will be a decade of tremendous growth in our population. Let us hope also that we will have the wisdom to adjust our own individual and communal attitudes so that this increase in population of young people will get in their own country what many of our own colleagues did not get in their day. We can all think of our classmates who are scattered to the ends of the world. We hope that this young generation of ours will get employment in our own land. We can decide it. Do we want to employ our young people at home or do we want to scatter them? That decision has to be made by everybody who is at work. [1516] The decision is a simple one. We either forego a little today to provide for our children tomorrow or else we see them suffer. But it is not a question of them suffering alone because if the young people do not get gainful and satisfactory employment here there will certainly be a social and political upheaval. Nobody wants that and it is not necessary.

Mrs. Robinson: Could the Minister give us a precise date when this plan will be published?

Mr. R. Ryan: I was politely corrected by Senator Yeats. He did say, when I spoke about mid-summer recently, that he accepts that it means in the middle of the recess. The reason for my slip in talking about mid-summer was of course that a Minister for Finance never thinks of summer, it is always winter for him. I had not got round to contemplating that we were in the height of summer already. It will not be too long because we are looking forward to having discussions with the social partners in September and the Green Paper will be available before then because that amongst other things will be the basis for the discussions with the social partners. I hope that, unlike previous programmes and plans, Seanad Éireann and Dáil Éireann will get the opportunity of debating them because that is the way to get people involved. I am sure they will get a certain amount of knocking, that is one of the prices we pay for a democratic system but I hope there will be a positive response.

A number of Senators made reference to the public service and the need to reform the public service. I want to assure all that part and parcel of the plan will include steps to reform the public service, steps to avoid what happened in the past, that which was recognised in the NESC report by Professor Paddy Lynch last Monday. We want to avoid a situation in which there is a lack of commitment by each and every Department, each and every State agency and each and every group in the community. When we assumed office we found that there was a planning [1517] division in only one Department of State, in the Department of Finance. Since then we have introduced planning sections in most other Departments and we hope that by the end of this year we will have planning divisions in all Departments and these will all be linked into the central planning division in the Department of Finance in such a way as will ensure that, as happened in the past, nobody will be allowed to overlook the disciplines of the plan.

Question put and agreed to.

Bill put through Committee, received for final consideration and passed.