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Dáil Éireann - Volume 39 - 15 July, 1931

In Committee on Finance. - Vote 29—Beet Sugar Subsidy (Resumed).

“That a sum not exceeding £162,500 be granted to defray the Charge which will come in course of payment during the year ending on the 31st day of March, 1932, for payment of the subsidy in respect of Beet Sugar (No. 37 of 1925).” —(Mr. Blythe).

Debate resumed on motion: “That the Estimate be referred back for reconsideration.” —(Deputy Davin).

Minister for Agriculture (Mr. Hogan): It was said on the last day that we should have taken this matter to the Dáil long ago, and it was suggested that if we did we would receive helpful suggestions and that very likely this dispute would be settled. This discussion has come before the Dáil and we have had the benefit of a couple of hours' debate upon it, and what are the helpful suggestions we received? Deputy Derrig suggested compulsory arbitration or, to use his own phrase, “something else.” In fact, running through the whole of the debate there was that suggestion from all Parties that we should do something undefined. Some suggestions like compulsory arbitration got a sort of doubtful blessing from Deputy Derrig and a complete condemnation from Deputy Davin. Generally speaking, it was to be left [2004] to ourselves, that we would do something, that we ought to stand by our people, etc., etc.

Deputy Derrig, however, to some extent did commit himself to compulsory arbitration as an evidence that he was extremely anxious to settle this dispute, and he implied that a figure of 49/- might be paid for beet. I shall ask the Dáil to consider that point. That was thrown out in an indefinite way by people who are anxious for a settlement. Let the Dáil mark this, the Beet Growers' Association, the people genuinely interested, the people who are to get the money, the people who have not such an interest in the politics of the matter but have an interest in the economics, asked for 46/-. I dare say they would take less. I am not saying how much less. They asked for 46/- The helpful people all out to settle it ask 49/-.

Compulsory arbitration is an easy phrase, easily understood and like everything else compulsory arbitration is supposed to settle all difficulties. But anybody who has any experience of business and who thinks over this proposal of compulsory arbitration for a moment will see it is not so simple as it looks. Why compulsory arbitration in this case? Are we to confine compulsory arbitration to the beet growing and to the beet factory? I presume we are. I presume compulsory arbitration is not going to become general in business in this country. I could understand Deputies taking up the line definitely that “we are State Socialists, we think the business of the country should be run by the State” because that is what compulsory arbitration in the long run, analysed back, comes to. They do not take that line. In this case there is to be compulsory arbitration. What is the distinction between this business and others? There is one distinction between this class and numerous other classes of business and that is that in this business the State is giving a big subsidy. Am I to take it that there is to be compulsory arbitration every time the State gives a subsidy, that somebody outside the business is to fix the price [2005] at which the business is to buy raw materials and presumably to fix the other price?

But I will come to that later. It should be remembered that this is not the only industry in the country run with the help of money which does not come out of the business itself but comes either from the taxpayer or the consumer. Practically every factory which is operating in this country under a tariff is getting good money from the consumer, who is the same person as the taxpayer. Are we to have compulsory arbitration there? If Deputy Derrig and other amateur economists of Fianna Fáil will think over it they will find you cannot say “compulsory arbitration” and stop at that. Compulsory arbitration raises a number of very difficult and thorny questions which would divide all parties. Further if we are to have compulsory arbitration not only in this case but every case where there is a State subsidy, whether it comes from the consumer or the taxpayer, what is the arbitration to be about? The price of the raw material? Is it to include the wages of the employees? Are the farmers who are supplying the beet to the factory to accept compulsory arbitration in regard to the wages they are to pay their employees? That is what it amounts to. You cannot have it both ways. The fact that the words “compulsory arbitration” have been used merely shows an absence of any argument, any thought or any practical suggestion. Coming to Deputy Davin's point, the suggestion of compulsory arbitration came along with the suggestion that 49/- should be paid, which is 3/- more than the Beet Growers' Association ask. That will give the Dáil some idea of the anxiety of Deputies opposite to settle the dispute. It will give the Dáil some idea whether the real anxiety was to keep the dispute going and to make political capital out of it. Deputy Davin suggested that the factory should be taken over.

Mr. Davin: The beet growers suggested that.

[2006] Mr. Hogan: The beet growers and Deputy Davin.

Mr. Davin: They suggested compulsory arbitration also.

Mr. Hogan: I am dealing with what was said here. The Dáil was to settle all. Deputy Davin, I think, gave that suggestion his blessing. Shall I put it that way?

Mr. Davin: Yes.

Mr. Hogan: The suggestion was that the factory should be taken over at this price; the difference between what it cost and the amount by which it has depreciated. I am not dealing with that now. How far is that principle to go? Does the Deputy really think that throwing out a suggestion of that sort is practical or is going to solve—leave out politics now that the election is over—the question? Is it going to give any sense of security to people who are seriously thinking of starting business here? Deputy de Valera, of course, made a typical suggestion. He wishes to repudiate the agreement.

Mr. de Valera: I did not say anything of the sort. Quote me.

Mr. Hogan: Yes. The Deputy suggested that the subsidy should not be paid this year.

Mr. de Valera: I did not. Quote me, please. Will the Minister let me read it? I will read everything, if the Minister wishes, that I said.

Mr. Hogan: Read that reference. I have not the book here, but I will not let this point pass.

Mr. de Valera: Neither will I.

Mr. Hogan: Deputy de Valera suggested that the subsidy should not be paid to the factory this year.

Mr. de Valera: I did not.

Mr. Hogan: And that instead it should be paid to the farmers as compensation.

[2007] Mr. de Valera: I did not. What I said was quite clear, that this year, on account of the beet not being grown, portion of the ordinary subsidy would be unexpended and that that unexpended portion——

Mr. Hogan: I did not understand that.

Mr. de Valera: Deputy Gorey started off the hare.

Mr. Hogan: I assure the Deputy that I do not read his speeches. I accept what he said. There were other suggestions made. There was a suggestion that there was something wrong in depreciating to the extent it was depreciated. It was suggested by Deputy Davin that 15 per cent. has been earned by the factory since its inception. There were other references which in my opinion were a thorough disgrace to the Dáil.

Mr. Davin: I did not say since its inception. Quote me.

Mr. Hogan: The Deputy mentioned one figure, fifteen per cent., and he left everyone under the impression that that was what the factory had paid.

Mr. Davin: Last year. Leave out politics.

Mr. Hogan: The Deputy interrupted sufficiently the last day. I ask him to remember he is not in the Chair. There were other references to Congo methods which were a disgrace to the Dáil. There were references to foreigners and so on—a new sort of Sinn Féin—the operations of foreigners and the Congo methods. All that is going to help to settle the dispute and to encourage enterprise! I say that these references, whatever the merits of the dispute this year, are a disgrace to the Dáil. They are references which were not made at any time by the parties who are suffering most, the farmers themselves. It was left to the leaders, the public representatives, to come here to make statements of that sort purely and simply for political purposes.

Mr. Davin: Are you including Deputy Gorey in that?

[2008] Mr. Hogan: I am including everyone who made the statement. It was Deputy Davin who started on the Congo methods.

Mr. Davin: I will not withdraw them.

Mr. Hogan: I am not asking the Deputy to withdraw. I say these statements are a disgrace, apart from the criticism of foreigners. If foreigners come in here they are entitled to the benefit of the law. If they do anything which is not right we can deal with them. While they keep the law and give employment and establish industry they should not be met by irresponsible criticism of that sort. The fact that Deputies in the Labour Party or that members of the Fianna Fáil Party make statements of that kind shows conclusively that they are more interested in keeping the dispute going than in settling it. The fact is that there are only two parties here who are seriously concerned and who are attempting to settle this dispute, the Beet Growers' Association and the Government of the Irish Free State.

Mr. Davin: Tell the House when you are going to settle it.

Mr. Hogan: I will come to that. The Deputy might contain himself and leave the question of order to the Chair. I had not Deputy de Valera's quotation before me, and I accepted his statement. I will give him an extract from what he did say:

At least, he (that is I) could say now to the company: “We have been generous with you. You are asking our people to grow beet at a price that is uneconomic. That price gives you an unfair profit, and because the circumstances are such we are going to help our own people in their fight against you and support any organisation that they set up to defend their interests against you.”

That is what we are to do this year.

“Any subsidies that we are going to give you or remissions to encourage beet growing we will use, and more money as well, in order to see that those who have had to devote their land to other crops will be put in a position to fight you [2009] and if necessary to see that you get no subsidy.”

Mr. de Valera: Will the Minister please read the end of column 1956?

Mr. Hogan: Is this it?

To get back to this particular matter, we want to see the powers that are here to defend our own people exercised. If there is a portion of the subsidy not paid as a result of the beet not being supplied, we think it is only fair that the farmers who have been compelled to sow other crops in place of beet should not suffer a loss by that, and portion of that subsidy should be devoted to seeing that they do not suffer a loss.

That makes the matter quite clear. I had a distinct recollection of that statement. However I leave that point. Wild statements have been made here and elsewhere which have not tended to settle the dispute, with the result that the country as a whole has got a very wrong opinion of the merits of the case. I will try to show what the merits of the case are.

Mr. Davin: Hear, hear!

Mr. Hogan: To clear up a few preliminaries, it has been suggested that the company has been extremely wrong in depreciating to the extent that they have depreciated, and secondly that they have paid a bad price for beet from the beginning and high dividends. I want to say first that it must be realised that the factory is not getting as good terms here as they could have got in England. From that point of view it must be remembered that the subsidy in England applies not like our case to one factory or even to two factories, but to anybody who establishes a factory there. If this factory had been established in England a higher subsidy would be paid. It would be higher by about £400,000. One point that can be made is that during the last year, as a result of the very large amount of sugar which this factory made in the first eight years and as a result of their being confined to a certain maximum quantity of sugar, the subsidy here during the last year would not be big enough to enable them to carry on.

[2010] If the subsidy here were increased during the 10th year by an amount sufficient to bring it up to the amount on the 8th year the factory would be still getting less by £300,000 in the 10th year than any English factory of the same size. Further if the 1s. 3d. which is being got this year in England were not given during the next three years the factory here would still be getting less than the English subsidy by £300,000. If both considerations were present, namely, that we increased the subsidy here by £100,000 in the past year, to bring it up to the amount of the previous year, and if the English factory were not getting the 1s. 3d. which they are getting this year, and which everyone knows will continue even in these contingencies, the factory here would be receiving £100,000 less than the factories in England receive for the ten-year period. That was the bargain we made. In England all the factories to a very great extent have been financed by State-guaranteed money. Here the factory was put up at the expense mainly of the directors, put up entirely out of their own capital. That should be known. We must deal with both sides if we are to get the merits of the case. In the first year they practically paid 10 per cent., for the next three years 15 per cent., and last year they had a loss of about £15,000. That was never mentioned. The balance sheet has just come out. I am not sure of the amount but I know that the balance sheet shows a loss of about £15,000. That is very far from being an exorbitant dividend, considering everything, when the four years are put together. The dividends here are not bigger certainly than those paid by similar factories in England. From that point of view the Irish Sugar Manufacturing Company declined, and, in my opinion, rightly declined, to be compared with any factory except the best group of factories in England. There is no question about that and it should be realised by people with the interests of the industry at heart that the factory in Carlow is certainly one of the best in the world. It is admittedly a better factory than the best and most efficient in England belonging [2011] to the Anglo-Dutch group. The output on coal and per sugar content of beet is as high as in any factory in Europe and those in charge decline to compare it with any but the best factory in England. That is a position I have great deal of sympathy with. People should get credit for that efficiency and from that point of view their dividends are similar to the dividends paid by the Anglo-Dutch group in England.

Further it has been stated that their provision for depreciation has been enormous. In that connection it has been pointed out that the amount of subsidy would not only pay for the beet, but would give them a certain amount over. Deputies will have to realise that they do not know all about sugar beet, and that there are some things which they have to learn in regard to sugar factories. They will have to realise that it is a fact that it is the invariable custom in every sugar factory to attempt to depreciate in the first ten years and it is a fact that the balance sheets show that the depreciation, plus reserves of the Anglo-Dutch group in England has been considerably higher than the depreciation, plus reserves of the Irish Sugar Manufacturing Company. I compare them with the Anglo-Dutch group in England for this reason. They are admittedly the best groups in England. Their factories run about 13,000 or 14,000 tons of sugar. They are admittedly the best factories in England and you can very readily and with justice compare these factories.

I take the position in regard to depreciation at their factories at Ely, Ipswich, and King's Lynn. These factories have been in operation for respectively five years, five years and three years—giving something of an average of over four years. The total capital of these factories was £1,666,000. Their total reserves are £446,000 and their total depreciation £772,000. If you add these figures you will get £1,223,000, while the total amount of the capital invested is £1,666,000. I would ask Deputies to compare these factories with the Irish Sugar Manufacturing Company who [2012] have not depreciated or built up reserves to anything like the same extent as the Anglo-Dutch group. The point of that is this. The subsidy in Ireland is somewhat smaller than the subsidy in England and at the same time even though they got a bigger subsidy, if you compare the four years which have just passed up to 1929-30, the Irish factory, even though the subsidy was smaller, paid the same price and made practically the same dividends as these English factories. They paid as good a price on a smaller subsidy. This particular year their subsidy is higher than the English subsidy.

The English factories have consented to go on this year without any profit, with nothing for depreciation and no reserve. The Irish factory have put forward the case, and on these figures it must be admitted that there is something in the contention, that the English factories can afford to do that this year because their reserves and depreciation are so very much bigger. An examination of the figures makes it clear that there is something in that point, that they have a bigger depreciation and bigger reserves. The total amount of reserves and depreciation of the Anglo-Dutch group is £1,223,000, while the total outlay is £1,666,000. They have built up reserves and depreciation to more than three-fourths. That is the answer of the company to people who say that they should accept this year the same terms as in England. Their answer is, in fact, “We gave better terms for the past four years than the English companies—better terms in the way of price and better terms generally. If we had given worse terms and depreciated to a greater extent we might be able perhaps to do what the English companies are doing. We have not done that, and you cannot have it both ways.”

I say there is something in that point. It is no use, as Deputy de Valera suggested, in saying that they are getting a subsidy which covers the price of beet and something over. That is so, but no factory in England has been able to run on any other terms. The point is, that whatever subsidy [2013] they are getting is smaller than the English subsidy, and, as I say, the English Act is a general Act. Anybody who comes in can establish a factory under it. It invites factories. People will come there and take the best terms they can. It is a fair test to take. The argument that the amount paid by way of subsidy is more than is paid for the beet, if that argument is used, can only be used for one purpose, and that is, that the production of beet is not economic. If that argument is to be used and is to have any validity, it can only mean that the production of sugar beet is not economic. If the Irish factory is getting enough to pay for beet and leaving something over, the factory is in the same position as the English factories—in fact, they are in a worse position, because they are getting a somewhat lower subsidy.

Coming to the merits of this year's dispute, it is true that the factory is getting a bigger subsidy than it got last year. It is true that when you add that increase and also give the company the benefit of the decrease in the price which they are paying for beet, a decrease of from 46s. to 38s., in that way they save something like £80,000. They, of course, put up figures to show that as compared with the year 1929-30 there is a drop in the price of sugar and in sugar pulp which would amount to £80,000 or £90,000. To make a long story short, they produce a balance sheet which shows that on a payment of 36s. per ton for beet they would provide ten per cent. dividend and leave this year some £10,000 or £7,000 to carry forward.

Mr. Davin: And provide £45,000 for depreciation.

Mr. Hogan: I am coming to that. Now we come to the other side of the case. I say that up to this year the beet factory gave good value and I think the growers will agree with that. 46s. was a good price last year. It was a good price last year and it was a goodish enough price the year before. As a result of that price the farmers did get a fair share of the subsidy. In fact for the last four years this factory, coming in here at a time of great [2014] difficulty, gave good service to the country, not only to the farmers of the district but gave good value in the production of sugar. They gave up to this year as high a price and in some cases a higher price, and they did it on a somewhat smaller subsidy. This year a dispute occurred and as I have told you their case is that the fall in the price of sugar and beet pulp, together with the increase in some other things would more than counterbalance the increased subsidy this year plus the advantage they gain by paying a smaller price for beet. On these figures there can be no question of doubt about it, the Irish Sugar Manufacturing Company put themselves definitely in the wrong. Say that we can make all the other admissions as to depreciation, that we can admit that they depreciated up to this year normally, that their interest, taking everything into account, was not exorbitant—we can admit all that without weakening our case one iota— that even this year they attempted to get across an agreement which was not fair to all the growers. They admit that this year they are increasing the provision for depreciation from £40,000 to £45,000. That is unfair, and £40,000 or ten per cent. is the normal orthodox depreciation in a beet factory.

It does seem extraordinary that in a year in which sugar fell to a price which was below or round about the pre-war price, that in a year in which sugar fell to a price below which experts agree it can scarcely fall further, the company increased the provision for depreciation. They excuse themselves by saying that they were uncertain as to their position in the tenth year. That is no excuse. The factory even as scrap with the buildings around it would be worth £50,000. There is no excuse to depreciate by £5,000 extra this year and endeavour at the same time to pay a ten per cent. dividend—what they themselves admitted is to place the entire fall in the price of sugar on the farmers. That was unfair. Further they over-insured themselves in certain small items which taken on the aggregate are rather big. They budgeted for a very big price in the [2015] full period. It is generally agreed and it was clear enough to me in the negotiations that took place between myself and the factory that they over-insured themselves there. They also over-insured themselves in regard to the increase in freights. Above all they over-insured themselves in regard to the price of sugar. Of course the price of sugar is a very important item and they calculated at the beginning of the year what they could pay. Sugar had fallen to about 6s. 9d. per cwt. Some months afterwards when it was too late to settle the dispute the text of an agreement was published in the papers, an agreement come to by all the sugar manufacturers of Europe and in other countries as well, and since that agreement the price of sugar has been going up a bit. I think it might reasonably be inferred that the company knew when they were making this agreement that sugar was not likely to fall any more. I have no doubt that they were prepared to carry forward £5,000 for depreciation. There were other items which would bring that sum up to £15,000 or £16,000.

All these items gave them £15,000 to £18,000 to play with which in all equity could have gone to the farmer in the price of beet. I am not saying this on behalf of the Beet Growers' Association. I am not committing the Beet Growers' Association to any price. I am merely saying that on their own figures, this year there was that amount of money there which could have been given. I am merely saying this as I was closely in touch with the Beet Growers' Association and knew their minds—I was, as also was the President, in touch with the Sugar Manufacturing Company and I can say that if they had shown any tendency to see the equities which were standing out there, this dispute would have been settled. Unfortunately they wanted to fight and the fight is over now so far as this year is concerned. It is unfortunate, but it is over as far as this year is concerned. We made, as everybody knows, as Deputy Derrig knows, because he was in touch with the Beet Growers' Association, every effort—I as Minister for Agriculture and the [2016] President, as Head of the Executive Council—to compose this dispute.

We failed this year after the Spring had definitely passed and even when it became too late to sow beet, we immediately took up the question of re-opening negotiations for the next four years. We have made a considerable amount of progress in the last month. Deputy Davin said that the Sugar Manufacturing Company are not going to meet the Beet Growers' Association. I hope he is wrong, but if that is so, it opens another question. On the contrary I have been in negotiation with the Sugar Manufacturing Company within the past two months and I am hopeful and in fact I believe that they will meet them. I believe that this dispute can be settled in the coming year without recourse to any of the heroic measures put forward such as compulsory arbitration, compulsory acquisition of the factory or compulsory this, that or the other.

I think that that is really all that is to be said on the merits of this case. If Deputies consider that the Government should establish an industry here and insure it against any possible dispute they are asking for the impossible. It cannot be done. Everybody would agree with that if they were to consider it dispassionately. It is hard for the Beet Growers' Association and the farmers who are losing heavily this year to realise that. I do not expect that the farmer in bad times will remember that he did well out of this crop for four or five years. Naturally, he concentrates on his misfortune this year when he cannot grow the crop and has to find a very much less remunerative crop. It is only natural too that politicians would make a certain amount of capital out of any trouble that arises, but having some regard for the future of the country and to the fact that other industries must be established here and the fact that their own policy has been to subsidise or to encourage industries, both by the money of the taxpayers and of the consumers, and by State interference, I would expect them to remember that. When you come to consider it dispassionately, in nine out of ten cases [2017] can there be no alternative to what Deputy Derrig calls haggling but what I call negotiation.

Deputy Davin stated he would not have compulsory arbitration. It might lead us on a very long road. I do not care on this point what the Beet Growers' Association say. I think I am talking more really for the farmers of the country when I say that they will not have compulsory arbitration also, either on this or other matters. Compulsory arbitration is the last thing except acquisition of the factory is the last thing. This dispute has lasted for one year unfortunately, but I believe that it will be settled in the coming year. It is as between 38s. and 46s. a ton, and it does not justify any such heroic measures. I believe it can be settled and will be settled, but there is this to be said: if it is not settled, if either party put themselves in the wrong, it will have to be dealt with. Anybody can make one mistake. Every dog, I believe, is entitled to one bite. People do things and say things on the spur of the moment in heat. Everyone can make allowances for that, but they have been fighting long enough. They have tried it out now, and I should say that both sides are in a better mood at the moment to end the dispute.

I was told that the farmers are suffering great loss. They are. So is the factory. It may be a very brutal way of settling disputes, but the Labour Party, the farmers and everybody else settle disputes in that way. They usually stand on their legal rights. Every party insists on its legal rights. If they considered it a little more calmly they would find that stupid, obstinate insistence on legal rights gets nobody anywhere. To come to business and settle it is far better than compulsion. The fight is over for this year, and, as I said, I believe it will be settled in the coming year. Both sides have to remember that the taxpayer has a very big interest in this factory and that we cannot stand by and see an establishment which has been conducted successfully and creditably up to the present wrecked because tempers have run high. Moreover, [2018] we would not stand by that. I need not go into that question any further at the present moment. There is no use dealing with difficulties that have not yet arisen. I have been in constant touch for the last four or five years both with the Beet Growers' Association and with the factory. I believe, notwithstanding or, if you like, because of what happened this year, that this dispute will be settled for the remaining years of the subsidy, and I do not propose to adopt any of the heroic measures that have been suggested here for the settlement of it.

Dr. Ryan: We on this side of the House are put at a very serious disadvantage by the Minister. He generally manages to express his views fairly strongly here, both on the question at issue and on the people who have spoken, but if we attempt to state our views on a question like the sugar beet industry we are immediately told that we are doing it in order to make political capital. We are always out for political capital, and the Minister is always out for the good of the beet growers or whoever it may be. It is an extraordinary thing. I suppose we should be thankful to have such a high-souled man at the head of agriculture in this country, that he would not attempt to make political capital out of any question. It must be very annoying to the Minister to have such political opponents as we are, who never see the justice of the case, but who are always making political capital out of it.

The Minister said that it was part of our policy to subsidise certain industries and certain production. Let us accept that. Broadly speaking, we are perhaps more inclined to subsidise certain production than the Government is. Is it not much more to our interest to see an industry like the sugar beet industry succeed than it is to the interest of the Minister for Agriculture who is against subsidising production in any way? If the Minister wants his policy of free competition and production, without subsidies or anything else, to succeed it is only going to convince the people of this country that the Minister's policy is right if the [2019] sugar beet factory fails or if the whole sugar beet scheme fails. It is going to militate against us if that experiment fails. Hence we are very anxious that the thing should succeed, whatever the Minister may say—I do not think he believes it—in this House.

The Minister made two statements here the last day. He repeated one of them to-day. He said that first of all the bargain he made with Messrs. Lippens was an excellent one and secondly he said that when you compare the Carlow Beet Sugar Factory with a factory of equal size in England the English factory would get £400,000 more in subsidy in ten years than the Carlow factory would get. He challenged us to dispute that figure. It is a very difficult figure to dispute because the subsidy is paid in different ways in the two places. In England there is a subsidy on molasses. Here there is a subsidy on sugar and there is also a remission of duty. The only thing I can do in order to throw some doubt on what the Minister has said is to quote a speech that he made here in 1928. Speaking on this subject in this House on the 24th of February, 1928, first of all talking about the excellent bargain that was made he said: “I believe that but for the events of the last five years we could have had a factory with a smaller subsidy—not very much smaller, because when you compare the subsidy in our first ten years with the English subsidy there is not such a tremendous difference.” He had made a speech about the petrol tin, the smell of burning houses and so on, and he went on to point out to the people of the country how we had been responsible for making a worse bargain on the sugar beet than would have been the case if there had been no Civil War. But since then evidently the Minister has come to realise that the people of this country do not now lay the blame of the Civil War on us and he says the bargain was the best that could be made.

He went on to say that the subsidy for the first ten years worked out at, he thought, 22/6, and the English subsidy [2020] for the first ten years was 19/-. On the 24th of February, 1928, the Minister stated in this House that for the first ten years the subsidy in England would work out at 3/6 less than the subsidy here.

Mr. Hogan: Remember that would be if I were calculating it on the first two or three years of this subsidy. They made less than 13,000 tons of sugar, and handled less than 22,000 tons of beet. In 1928 we had only the figures of the first two or three years. If you calculate on less than the total quantity of sugar which the factory could make being made you will, of course, increase the subsidy, but immediately after the first two or three years, as of course we foresaw, the beet growers even more than doubled the capacity of the factory. The Deputy will get the figures in this publication which has been issued.

Mr. MacDonogh: Have not you made a contract in any case? Keep to your contract as decent people do.

Mr. Hogan: If Deputy Dr. Ryan likes I will give him the subsidy each year for ten years.

The President: 19/6 is quite right, but there is also a molasses duty.

Dr. Ryan: As a matter of fact, I was going to quote the President also, because his contribution on the same day is interesting.

Mr. Hogan: If the Deputy likes I will give him the exact figures each year.

Dr. Ryan: Yes, later on. The subsidy here, according to the Minister on the 24th February, 1928, was 22/6, while it was 19/- in England. It is possible that the Minister may be able to put a better complexion on that now than he was on the 24th of February, 1928.

Mr. Hogan: That is not fair. 19/6 was the direct subsidy. The total subsidy was 26/9.

Dr. Ryan: The Minister stated that for the first ten years it worked out at, he thought, 22/6, and in England at 19/-.

[2021] Mr. Hogan: That is the direct subsidy.

Dr. Ryan: As I say, the Minister had made a very hot speech about petrol and burning houses. He wanted to prove that only for the Civil War things would have gone better for the Carlow Beet Factory.

Mr. Hogan: I was referring to the direct subsidy in both cases.

Dr. Ryan: The President spoke about half an hour afterwards. He said: “Taking into account what the Minister has said that there is a difference of 2s. between the subsidy here and in Great Britain”—the Minister's case is that the difference is 3s. 6d.

Mr. Hogan: That is the direct subsidy.

Dr. Ryan: You did not say direct.

Mr. Hogan: Look at the figures, it is clear.

Dr. Ryan: In column 382 the Minister is reported as stating the difference to be 3s. 6d. while in column 394 the President is reported as stating the difference as 2s. That is over three years ago. If the Minister had been right in his statement of 3s. 6d. difference the subsidy here would be exactly £400,000 more than the subsidy in Great Britain. In half an hour the difference of 3s. 6d. becomes 2s. and after an interval of three years the £400,000 becomes reversed. In any case, I have read the statement of the Beet Growers' Association. I believe they went to considerable trouble to get the figures they produced, and the balance sheets and so on would appear to support their case. They make the very definite statement that if you compare the factory in Carlow with a factory of similar size in England for this year the factory here would be getting £100,000 more than the factory in England. I do not think it is fair for the Minister to come here and state that we are getting off £400,000 better than a similar factory in England. I do not think it is fair for him to [2022] come and challenge us to prove it wrong. He should have given us the figures when he was making his speech.

Mr. Hogan: I made that statement three weeks ago.

Dr. Ryan: I do not think it was fair for the Minister to throw three or four columns of figures now at me, not giving me an opportunity of looking into them, and asking me to accept them as proving his case. We have had a good deal of talk from the Minister and others about the businesslike way in which the agreement was made. We very seldom have a discussion here at which we do not have a lecture from the Minister on business methods. He tells us “that is not the way business is done.” Another time he tells us “anybody who knows anything about business will do it in this way.” I find that the Minister was delegated by the Executive Council to negotiate with Messrs. Lippens in order to start this Carlow Sugar Beet Factory. He was the person who was there negotiating with Messrs. Lippens, and we have it that when the Minister was making this agreement with Messrs. Lippens he went in to make it in the most businesslike way possible. He did conclude an agreement with these people, guaranteeing them a subsidy for ten years, but he only got in return a guaranteed price for the beet growers for three years. That, apart from anything else, should have made it fairly plain to anybody that the agreement was one-sided. If there were two parties to that agreement, and if the two parties had maintained their rights in that agreement, surely the Minister would not have guaranteed them a subsidy for ten years unless in return the people who were to manufacture the sugar were prepared to guarantee a price for the beet for ten years to the beet growers, or, in default of that, a provision should be made in case of dispute that there would be some arbitration machinery to settle that. That was the businesslike way the Minister made this agreement.

We have been told before to-day how this agreement was made. The Minister speaking down in Athy on the 14th June told the people how he made this [2023] agreement. He told them how when he met Mr. Lippens that there was a financial adviser of Messrs. Lippens present. He told how the financial adviser told Mr. Lippens that this was no country for him to come into at all. He reminded him of the Civil War and he said he doubted that the farmers would grow beet satisfactorily and that labour was unreliable. The Minister told this financial adviser that he was a liar. We were also told dramatically by the Minister how Mr. Lippens said: “ I believe you,” and started the factory. Messrs. Lippens started the factory having been assured by the Minister that the financial adviser whom he had brought in was a liar, when he had told him that it was inadvisable for him to start a factory here. That is the businesslike way in which this was done. The only convincing point in the story was that the Minister was able to call the financial adviser of Messrs. Lippens a liar.

The publicists of the Cumann na nGaedheal Party were so delighted with the story that they really got out a leaflet and distributed it all over Kildare showing how the Minister had the wit and courage and wisdom to call an Irishman a liar and that Mr. Lippens turned to him and said: “ I believe you.” That leaflet was got out in order to convince the people of Kildare that Mr. Hogan was a good business man, that he was not afraid to say to an Irish financier “You are a liar,” and was always prepared to talk out his mind on any subject. That leaflet was sent out headed “That is the stuff behind Conlon.” The people of Kildare evidently thought that they would like something more substantial behind Mr. Conlon. They were not a bit interested in the caption “Straight Speaking Means Straight Government,” and they disregarded the advice of “Vote No. 1 Conlon.”

The Minister when talking on this subject tried to give the House the impression that he was holding the balance of power as fairly as any man could do between the two parties. First of all he told us about the costs [2024] at the factory. He gave us a very fair outline of the case that the factory had. Then he turned to the Beet Growers' Association and told us the case that they had and he wound up by saying “ Taking everything into consideration it is my opinion that the factory could afford to pay a little more for the beet.” And so they could.

I believe that the Minister has not for the last five or six years shown the factory that he was prepared to stand up against them, as he was prepared to see the price of beet reduced if such a reduction should be necessary. The Minister speaking here on the 24th February, 1928, was asked a question as to whether there would be other factories started in this country and he said “there is no question of starting other factories on the basis of subsidising agriculture to the tune of £24 an acre.” There is only one meaning that can be taken from that answer and that is that in his opinion the subsidy that was going to agriculture was too high, that the farmers were getting too much out of the beet and that if it were ever possible to start another sugar factory in this country it should be on a basis of giving less for the beet. Talking on the very same subject on the 24th February, 1928, the Minister said, in dealing with the factory: “I cannot understand why people take a balance sheet in connection with this experiment, examine it and say that the company made £50,000 net profit, £114,000 gross profit and consider that this is criticism of the scheme. I consider that is in his favour.” Then he goes on to say: “I am sorry they have not made £100,000 or £200,000. I should like if they had made £400,000.” Contrast those two statements. Imagine a man like Mr. Lippens or anybody else connected with the factory reading that speech and seeing the Minister had stated here publicly that he was not going to have any more to do with sugar factories when the price paid for beet amounted to a subsidy of £24 an acre.

Mr. Hogan: Yes, I said I was not going to have anything to do with [2025] any other factory on the basis of such a high subsidy.

Dr. Ryan: That is what I say.

Mr. Hogan: No. On the basis that the price paid was too high—that the subsidy was too high.

Dr. Ryan: Is it the point that the price paid for beet was too high?

Mr. Hogan: No.

Dr. Ryan: He was not going to have any more to do with the factory where the price paid for beet amounted to £24 an acre.

Mr. Hogan: That is not the point.

Dr. Ryan: The only meaning I can take from that is that the farmer was getting more than in the Minister's opinion the country could afford.

Mr. Hogan: On that year the farmer was getting 50s. a ton for his beet and no farmer could expect that price to go on.

Dr. Ryan: I admit that. The farmers at a later period were satisfied to take less. I am contrasting that with what the Minister said that he was not going to have any more to do with the starting of other factories when the farmer was getting 54s. for his beet.

Mr. Hogan: Yes.

Dr. Ryan: The Minister said: “I am not going to have any more to do with factories where the subsidy paid for beet amounted to £24 an acre.”

Mr. Hogan: Certainly.

Dr. Ryan: Take it that the owners of the factory read that statement and here is their impression: “Here is a Minister who would be delighted to see us getting bigger profits and he will also be delighted to see smaller prices paid to the farmers because then he will be in a position to start other factories.” That is the impression they will gather from that statement of the Minister—that they would have the Minister behind them in cutting down prices to the farmers and also in making bigger profits. I do not know whether the owners of the [2026] factory read that statement or not. Whether they did or not, if they did not, what I have suggested here is what they would do if they had read the Minister's speech. That is what they have done. They have consistently tried to cut down the price of beet, and they have continued in spite of the slump in the price of sugar to pay £60,000 in the form of dividends, £40,000 depreciation, and £6,000 reserve. The Minister has told us now that he has seen an advance copy of the balance sheet for the last year and that it shows a loss.

Mr. Hogan: I have not seen an advance copy of the balance sheet, but I have a statement which I believe is correct.

Dr. Ryan: Another matter that Deputy Gorey mentioned here the last day is this. The Deputy mentioned, whether on his own initiative or encouraged by other members of his Party I do not know, but he told us it was a delicate matter, and he said that certain people interfered in this dispute, and that it would be much better if they had not interfered. I quite agree with him, and I want to tell him this, that he thought I had laid a trap for him. I did not. I thought at the time when he was speaking of this matter that he was referring to somebody on this side, because he could never say anything too bad of this side or when anything bad was to be done it was somebody on this side that did it.

Mr. Gorey: That would not have been a delicate matter.

Dr. Ryan: No. But I thought the Deputy was getting extra polite. At any rate, I asked the Deputy who it was, and now I want to say publicly that I have just as much courage as. Deputy Gorey in saying that the Bishop of Carlow should not have interfered in this dispute.

Mr. Allen: Deputy Gorey did not say it.

Dr. Ryan: Well, he did say it, to give him his due. The Bishop interfered in this dispute. But in interfering he only expressed the same sentiments as the [2027] President himself expressed. The President said that he had spoken to the farmers privately, and they told him that they were getting a fair price for their beet and that they were satisfied.

The President: That is something I do not recollect saying.

Dr. Ryan: The President does remember what he says as a rule.

The President: I do not remember saying that.

Dr. Ryan: It was published in the “Irish Independent” on the following day that the President said that he had privately discussed the matter with the farmers and that they said they were quite satisfied with the price they were getting. The President did not say whether he was referring to this year or last year. He might have been referring to last year's price. The beet growers might come to the conclusion that the efficiency of the Carlow factory was such and that the price was such that they should take the price, and that there should be no interference by the Beet Growers' Association with the growers. Again, the Minister told us here that it was a most successful bargain that was made with the factory owners when the factory was started, that it was one of the best factories in Europe, that it is most efficient and that it is making profits. All these things are admitted. In the debate here a few years ago, on the 8th November, 1928, when the Minister for Finance was pressed on the matter as to why he did not encourage the investment of capital in the Carlow Sugar Beet Factory, and even go so far as to invest some Government funds in it, he said that it was the policy of the Government to make the people who were coming in own a substantial part of the factory.

His idea was—it may be all right— that if the company which was coming in did not own a substantial part of the factory they might not give the same care or the same time to the working of the factory as they would if they were practically full owners of the place. The Minister has said that the [2028] subsidy is less in England this year than it is here. It is much less.

Mr. Connolly: That is the point. Let the Deputy refute the Minister's figures. That is what we would like to hear. Do not read the speech you wrote out last night, which has no relation to the facts.

Dr. Ryan: That is the man who asked three different Ministers about flooding and never asked the right one. The subsidy in England this year is 6/6; it is 22/6 here. The Minister of Agriculture in England some time ago brought in a supplementary estimate for an extra 1/3, and the money given under that estimate to the beet factories in England was only given on condition that they would pay no dividends, put nothing towards depreciation and nothing to reserve. In other words, that the whole benefit of the State subsidy would have to go to the growers if this extra 1/3 per. cwt. was to be given. If it is a fact, as the Minister said, that the owners of our factory could have got better terms in England than they are getting here, it is strange that the English factories this year have to work on that basis of not paying any dividends, of not putting anything towards depreciation and to reserve. That is the condition of getting the subsidy in England. There is no such condition here. If a factory working here can get this subsidy, and is permitted, if it can so manage, to pay a dividend and put money towards depreciation and reserve and everything else, as long as it can beat the farmers down to a certain price that will suit it, surely that factory is working under better conditions than in England?

The Minister also said that the Subsidy Act passed in England would admit any number of factories that came along. The Act here, including the agreement, I believe gives a sort of monopoly to the factory. Surely a monopoly is more favourable than coming in and taking your chances amongst others. A factory in England has no guarantee that another factory will not come into the same district next year, and there is no guarantee that it will get a certain [2029] amount of beet. The Minister on the last day referred to Deputy de Valera's wrecking policy. I believe he went so far as to say that Deputy de Valera's policy was always a wrecking policy. I do not know if the Minister—he denied it on one occasion —thought that about Deputy de Valera in 1916. At least there are men behind him who applauded that statement who thought in 1916 that Deputy de Valera's policy was a wrecking policy. What is his wrecking policy? His wrecking policy is going to wreck the Minister in trying to maintain the factory here and get the beet growers down to a certain price. Deputy de Valera read extracts here when the Minister tried to misrepresent him, and he made it quite clear what his policy was as stated in column 1956 of the Official Reports.

If there is a portion of the subsidy not paid as a result of the beet not being supplied we think it is only fair that the farmers who have been compelled to sow other crops in place of beet should not suffer a loss by that and a portion of that subsidy should be devoted to seeing that they do not suffer a loss.

That is the policy which is called a wrecking policy. Previously on that day, when Deputy Derrig was speaking the Minister asked him what was his policy with regard to the beet growers and those who were coming in to grow beet for the first time and Deputy Derrig said:

I want to see the small growers getting the benefit out of it as well as the big growers, but I am not prepared to say that the small growers should come in now at the expense of breaking up the Association.

The Minister then said: “That is my position also.” We want to see the small growers getting the benefit from this as well as the big growers. We seem to be united on both sides of the House that we are not prepared to see the small or the big growers coming in now and breaking up the Association which is making this fight for a better price.

Mr. Hogan: They are entitled to come into the Association.

[2030] Dr. Ryan: I agree with their coming into the Association. Deputy de Valera made a suggestion that would give these people a chance to fight. He made the suggestion that, if you have growers of beet who this year said they were going to stand by the Association and were not going to grow beet, that they are going to grow barley and oats instead, and are going to suffer a loss by doing so of £4 or £5 an acre—it may be much more—that these people should be helped and should get part of the unpaid portion of the subsidy in order to help them to put up that fight. The Minister called it a wrecking policy. The Minister is prepared to pay a subsidy to the factory for the people to come in and grow beet and wreck the Beet Growers' Association. He is prepared to subsidise the factory to fight the Association by getting other people to grow beet. Because Deputy de Valera said: “Help those who are not growing beet to grow another crop,” he said it is a wrecking policy. What is it going to wreck? Is it going to wreck the Carlow factory in its fight? It is going to compel them to pay more. That is what we want to see. That is what Deputy de Valera's suggestion amounted to, that we should compel the factory to pay more but because this suggestion came from Deputy de Valera it was a wrecking policy.

We are told from another source that it does not matter very much what subsidy we give to the factory. The estimate this year is £108,000. Then we come to “Pamphlets for the People, No. 1”—there are more to follow. This pamphlet asks, “Where do taxes go to? Back to the people.” That is issued by Cumann na nGaedheal and we find mentioned among the taxes that go back to the people—the beet sugar subsidy of £108,334. That is part of the £23,000,000 that goes back to the people, according to this pamphlet. A most extraordinary thing is, according to this pamphlet, that the people pay in taxes £20,000,000 and £23,000,000 goes back to the people—£23,000,000 out of £20,000,000 goes back to the people! Part of the £23,000,000 that goes back to the people is the £108,000 beet subsidy. Let us take [2031] the last balance sheet of the Carlow factory. Out of the £108,000, £40,000 goes for depreciation, £60,000 towards dividend and £6,000 to reserve. £106,000 to the Lippens group out of the £108,000, and that is how the taxes go back to the people! It will be most interesting to see the other pamphlets when they come along, as this is only No. 1.

We are told that negotiations will be resumed. We were told in Kildare that they would be resumed on 7th July. The polling there was on 29th June and they had to leave a margin and they said negotiations were to be resumed on 7th July. On 8th July they were resumed in the High Court. The Beet Growers' Association were brought there by the owners of the factory for contempt of court and they were found guilty and had to pay the costs and so on. That is where the negotiations were resumed. Now they are to be resumed again. I believe there are several other cases coming on in the High Court so that there will be plenty of opportunities while they are waiting for the cases to be called for Messrs. Lippens and the Beet Growers' Association to talk about the price of beet. We are told that it is no argument to say that they are getting more in subsidy than they are paying for beet. It is not, I suppose, comparatively speaking—I mean the same thing may be occurring in England and in other countries in Europe. Even so, it is no harm to say it. According to a statement which I saw from the factory contradicting a statement made by the Beet Growers' Association, the factory stated that they received 58s. 9d. per ton for beet for the first four years and paid 54s. 4d., and they only made 4s. 5d. in addition to getting the beet for nothing.

I am not against beet growing. I think it is the proper thing to do. It is the proper thing to supply our own needs in sugar, as it would be in anything else. We certainly should supply our own needs in sugar, just the same as in anything else, even if we have to pay 4/5 per ton to the beet factory, as well as paying for the beet altogether. Deputy Heffernan, I am sure, would not approve of that. He made a very serious objection some [2032] time ago to paying millers half the price of wheat—only half. Here we are paying 120 per cent. Fifty per cent. was a grave scandal to the Farmers' Party but 120 per cent. was all right. The Minister says that we cannot have compulsory arbitration and perhaps he is right. He says we cannot have buying out only as a last resort. I put it to the Government that the suggestion made by Deputy de Valera was the fairest and straightest suggestion made here, because we are not entering into the question of compulsory arbitration, although I myself, sooner than see the beet sugar experiment a failure, would vote for compulsory arbitration if necessary. I would vote, if necessary, for the compulsory buying out of the factory and hand it over to the sugar beet growers rather than see the experiment fail. But we have the third alternative suggested by Deputy de Valera and there is no objection to it as far as I can see——

Mr. Hogan: None whatever.

Dr. Ryan: —none from the point of view of the people who are so particular about contracts. If they are particular about the sanctity of contracts let them keep their contract with the factory and pay the subsidy as they have contracted to do, but there is no objection whatever to subsidise a very important section of the community to put up a fight against the people from the other side who are putting up an unfair fight. Deputy Byrne said the other day that in his considered opinion as a lawyer the Government had no power to interfere. I believe they have. I believe that when two people make a contract both parties are entitled to expect the utmost good faith. That is, I believe, what they call uberrimae fides.

If the Minister for Agriculture made this contract with Messrs. Lippens and has maintained his good faith in the matter by paying the subsidy, even though he sees his own people wrongly treated, that is the utmost good faith on the part of the Government, and Messrs. Lippens should also show the utmost good faith. We are entitled to get the utmost good faith from them by seeing that they pay [2033] a fair price for the beet. That is one reason. There is another reason and that is, that an agreement can be broken if it is unconscionable. I believe that the Minister, when he was giving us an account of how this contract was made, showed that that agreement was made in an unconscionable way, because it is evident from the way the Minister turned on the financial adviser and called him a liar, and so on, that Messrs. Lippens were too well able for the Minister. Therefore you have an agreement made by one party who is an expert and knows what he is doing and the other party does not know what he is doing, and an agreement can be broken where it is unconscionable. That is the second reason why it should be broken.

We on these benches are supporting the motion to have the Estimate referred back. We would be prepared to vote against the Estimate completely and to have it held up, but we are prepared in the interest of peace and in the hope that a settlement can be made and that the Minister may succeed in bringing the two parties together to vote for Deputy Davin's motion to have the Estimate referred back. I believe it is up to every member of this House who is interested in the beet growers to see that the Estimate should be referred back in order to show the owners of the Carlow Sugar Beet Factory that they must do something reasonable to get this dispute settled. They will see that members of this House are dissatisfied with the way things are going if they refer the Vote back to the Minister and say: “Go settle this dispute before you get more money,” but if the House passes this Estimate without referring it back then it would be a vote of confidence in the Carlow Sugar Beet Factory and for the way in which they managed their business not only for the last 4 or 5 years, but this year also in trying to break up the Sugar Beet Growers' Association.

Mr. Hassett: So much has been said by Deputies on both sides of the House on this Vote that I shall necessarily have to be very brief. I would begin by paying a tribute to the Government for establishing the [2034] sugar beet factory in this country at a time when there was considerable risk in establishing any industry in the country. I go further and say that every grower of sugar beet in the County Tipperary—and I am a beet grower myself—in the early years, at all events, after the factory was established made a considerable profit out of the transaction. The Government evidently at the time this factory was about to be established saw that grain was not a paying proposition; that the time was coming when grain growing was going to be a complete fiasco as far as bringing the cost of production into the pockets of the growers was concerned. It took considerable courage on the part of the Government to establish a factory of the magnitude of the Carlow Sugar Beet Factory. For the first year we were very well pleased. We appointed a body known as the Beet Growers' Association to look after our interests and we trusted them to see that we would get a fair deal. Men of considerable standing in the country were placed at the head of the organisation and any little differences that arose between Messrs. Lippens and these were happily tided over through negotiations. Latterly it would appear that as a result of the attempt which the factory people made to cut down the price of beet with fifteen and a half per cent. sugar content to 38/- last year it was for us growers of beet all over the country to consider whether or not that was going to be a paying proposition and it was time for the Beet Growers' Association to consider whether Messrs. Lippens, the owners of the factory, were going to give us a fair deal.

The Minister himself, who kept in very close touch with both parties, namely, the factory people and the growers, told us in the course of his speech to-day that the sugar beet growers were not getting a fair deal this year. He said that the factory people were allowing £40,000 for depreciation, that they were paying 10 per cent. on the money invested and he went further and said there is no excuse for what they are attempting to do. They have over-insured themselves [2035] with regard to the price of pulp and increase of freights and in regard to the price of sugar. The thing he says can be settled without the compulsory acquisition of the factory. The farmers did well out of the factory up to this year. If we have done well out of the factory up to this year we are prepared to carry on. We are prepared to grow beet if we get a fair do in the time to come. There was one very hopeful note struck by the Minister and that is that he expects that this thing will be satisfactorily settled before next year's crop will be put down. I think anything we can do on both sides of the House towards bringing about a satisfactory settlement of the dispute ought to be done.

I do not like to say anything bitter about the owners of the sugar factory but it is rather galling at a time like this when the Minister was using every possible effort to bring about a peaceful and happy settlement between the parties to the dispute that the owners of the factory should bring some of those people that we trusted in the organisation before the High Courts and should mulct them in costs and continue that threatening attitude up to the present time. I think a stop ought to be put to that. If negotiations are going on between the Minister on behalf of the Government and the Beet Growers' Association on behalf of the beet growers, and the owners of the factory, then these proceedings of the High Court ought to be stopped.

What are the demands of the Beet Growers' Association. These are the demands:—1. “That the Irish Beet Growers' Association, Ltd., be recognised as the body representing beet growing in the Saorstát, and that all negotiations for and concerning the growing, delivery and fixing of prices with the Irish Sugar Manufacturing Company during the subsidy period be carried out through the Beet Growers' Association.” Those of us who followed the dispute know that the particular aim of Messrs. Lippens for some time past has been to smash the Beet Growers' Association. They know that if they can smash that Association of which we are members they would [2036] have the beet growers at their mercy all over the country, that they could deal with them individually and that they would be able to take into consideration the bad economic position of the farmers all over the country and that they could get down-and-out farmers all over the country—blacklegs all over the country—to grow beet at the price that is not economic. To do that they offered several sums to individual farmers, I might say, in the nature of bribes. The condition of agriculture is bad to-day and has been for the last few years. Now these people come along and say we will give you seed; we will trust you to pay us back when the crop is grown.

We will give you the manure so as to give you an opportunity for putting the seed into the soil. The factory owners do that at a time when farmers find it impossible to get seed and manures from local merchants and elsewhere, and consequently farmers of that type—farmers who are down and out—are glad of the opportunity to get something to put into the soil, even though they know eventually that it will not be a paying proposition. Now the second demand put forward on behalf of the beet grower is “that when a mutual agreement cannot be arrived at each party shall agree to submit the point in dispute to an arbitration board consisting of a representative of each party and a referee mutually agreed to, or, alternatively, appointed by the Government, both parties being bound by the decision of the Board.” There is nothing very drastic in that demand of the Beet Growers' Association. There is nothing in that that the factory ought not to accept if they have a fair and a clear case. I assume that any arbitration board would act fairly as between the beet growers and the company, and that they would act as far as possible on the lines of doing justice as between the company and the growers. The next suggestion was alternative “that the factory be compulsorily or otherwise acquired by purchase and to be run on co-operative lines.” If no settlement can be come to-I have discussed this matter with representatives of the beet growers themselves—then we are prepared to take over the factory and [2037] to work it on co-operative lines. After all, why should we not? It may be said that when the £400,000 capital necessary to be found for the factory was being looked for the farmers got an opportunity of contributing and that we had no confidence in the undertaking. Well, to begin with, at the time we knew nothing about the business; it was too big for us; we were not able to rise to the occasion; we had no training in beet growing, but we did our share, and we did everything we were asked to do once a company was formed. We produced sugar beet of a type that was second to none. We produced more per acre than the people of Belgium, than the people of Czecho-Slovakia, or the people of England or anywhere else where sugar beet has been grown as successfully as with us.

I do not want to labour this question much longer, but I think it would be the wrong time to import any great heat into the matter. Some of us feel very strongly upon the matter, and some of us feel that as growers unfortunately we were badly treated and some of us feel that our Association was badly treated. I appeal to the Minister and to the Executive Council to continue their negotiations, and to do everything possible to bring about an amicable settlement as between the factory and the growers, and to remove any undue obstacles that may be in the way. If the owners of the factory still persist in the unreasonable attitude that they have taken up in the past, some of us will find it very difficult to come in here and to support a subsidy for them this time twelve months if the matter is not satisfactorily settled.

Mr. Aiken: I think the circumstances already exist which Deputy Hassett said if they existed at some future time would compel them to oppose the Government. I think the time has already arrived. The beet factory, before the time for sowing, definitely turned down the beet growers' demands. At the very last minute they again turned them down. Now, a couple of months after the beet should be sown, they are still holding to the same position. The fact of the matter is that the factory have flouted the beet growers, and have gone so far that the [2038] Minister for Agriculture, who usually backs them up, says there is no excuse for what they did this year. On figures, he said, the factory put themselves in the wrong. Again, he said if the factory wanted to see the equities the matter could have been settled this year. Surely there is a situation in which Deputy Hassett, if he has any manliness in him, should come forward and definitely vote against the factory.

Deputy Ryan clearly stated that a vote for giving a subsidy to the factory this year was a vote of confidence and support in fact and in deed to the factory for what they have done to the farmers, and Deputy Hassett cannot get round that by any threat of what he will do in the future. He has the opportunity of doing it now, and we would like to see what he is going to do. I wish Cumann na nGaedheal Deputies would really act up to what they think in this matter.

I am perfectly certain that a large number of the members of Cumann na nGaedheal do not approve of the methods of the Government towards the Beet Growers' Association. The members of the Cumann na nGaedheal Party, no more than ourselves, have not the real figure. We are given one set of figures by the Government at one time, and within half an hour we get a completely different set of figures, just as in 1928 the Minister for Agriculture, in the course of the debate, stated at one time that the factory was getting 3/6 per ton more than similar factories in England. Later the President stated that the factory here was only getting 2/- per ton more than the factory in England, while last Friday the Minister for Agriculture stated that over a ten years' period a factory in England would get £400,000 more than the Carlow Sugar Beet Factory, thus completely reversing the figures given three years ago. Cumann na nGaedheal Deputies must know perfectly well that they cannot trust the Government. The Minister for Agriculture stated to-day that the factory here was not getting as good terms as a similar factory in England. I wonder if anyone can believe that. He forgot he had said that because he said that in [2039] England they invited factories. If this factory was invited to England, and if those who are running it could make more money there, why did they come here? Did they come here because they love us, because they love President Cosgrave, because he has fair hair, or because they love Deputy Hassett's blue eyes? The fact of the matter is, as any man with ordinary commonsense can see, a factory which was at liberty to go to England came here because it was thought that more money could be made here. That bears out what the Minister for Agriculture stated three years ago, that the factory here would make £400,000, or, as the President said, £300,000 more than it would make if it went to England. I think the commonsense deduction is that the factory came here because it would make more money. The British factory decided to forgo profits and reserves this year in order to give a better price to the farmers than would ordinarily be given. I think it is up to any Deputy who wants to support the Irish farmers to see that they get a fair show, and to support us by not voting the subsidy until the whole position can be examined. The Minister says, “ Hands off the foreigner; we must keep contracts.” Surely the contract with the Irish people, that Irish farmers were to get a fair price, should be kept by the Government. I hope Deputy Hassett and others will, when a division is being taken, show by their votes on the motion to refer back the question of giving the subsidy, that they are not going to stand the nonsense of the Carlow Sugar Beet people any longer. If there is any dispute between foreign capitalists and the Irish people let them show that it is the interests of the Irish people they will plump for when they are fighting for their rights.

Mr. Heffernan: I do not want to prolong the debate, but I have certain points of view that I wish to express. I might shorten my statement by saying that, having listened to what the Minister for Agriculture said, I am very largely in agreement with the opinions he expressed. There are certain aspects, however, of his statement [2040] with which I do not quite agree, and that I intend to explain. I listened to Deputy Ryan, the shadow Minister for Agriculture in the Fianna Fáil Party, expounding the theories and doctrines of his Party in regard to the sugar subsidy, and I could not help thinking that the Deputy must have almost forgotten that he was speaking in the Dáil and thought he was still speaking in County Kildare. I am sure Deputy Ryan was not unaware of the fact that certain prominent members of the Beet Growers' Association were listening to him, and that he had in the back of his mind the possibility, if not the probability, that next week the “Wexford People” or some other Wexford newspaper would have a full report of his speech, and that the farmers and the beet growers would know what a champion they have in Deputy Ryan. The beet growers in Wexford may remember however that when the subsidy was passed by the Dáil, and when the scheme was hammered out, we had not the advantage of the presence here of Deputy Ryan and his colleagues. Perhaps they may say that if they had been here we would have had a better scheme. However, we had not that inestimable advantage, and we had to work out the scheme as best we could, without their help. I have been very silent on this question, and I did not mention it in any speeches I made in the famous Kildare election. I claim however that I have a better right to speak on behalf of the beet growers' and their association than Deputy Ryan or than any Deputies on the other side. I think it cannot be refuted that the idea of having a beet growers' association here in Ireland originated in the first instance with me. When the scheme was originally passed I went on my own initiative and, incidentally, at my own expense, to England to acquaint myself with the working of similar concerns there. I visited one important factory and got into touch with the Beet Growers' Association formed there. When I returned I got into touch with people here in the Association to which I belong. I told them that it was essential that a beet growers' association should be formed in the interests of the growers. I believe it was on my [2041] initiative that the General Secretary of the Farmers' Union got to work and called a meeting and, as well as I remember, Deputy Gorey was elected the first chairman. Credit should be given to the Farmers' Union and to Deputy Gorey for the action he took on that occasion, because then, as now, we were a political organisation, and having started the Association we thought it inadvisable that an organisation political in character should continue to organise an association of beet growers which we believed should be non-political. Deputy Gorey generously withdrew and allowed a non-political chairman to be elected. That is my justification for speaking for the beet growers and for their association.

As to the problem with which we are dealing, and which we are trying to solve, I think that everyone who wants to solve it is entitled to get the facts and the figures available so as to try to discover who is at fault, the factory or the Beet Growers' Association. The figures made available yearly in the balance sheet are not sufficient to let us examine in detail the working of the Company so as to arrive at a conclusion whether the price offered is the highest that could be economically offered. We have fortunately available this year certain figures issued not by the Beet Growers' Association but by the Irish Sugar Manufacturing Company in defence of the claim that they could only pay 38/- a ton. After examining these figures I am convinced that those who are running the sugar factory are convicted out of their own mouths in not offering a better price. I understand the figures were made available first to the Department of Agriculture and communicated by them to the Beet Growers' Association so that they are not confidential. The Minister for Agriculture dealt with them to-day showing that the offer of 38/- a ton was not as good an offer as the factory could make in the circumstances. If that is so we have them convicted out of their own mouth that they have not done as much as they should. The figures given are comparative figures between the working of the factory in the year 1929-30 [2042] and the probable effect of working it in 1931-32. Allowing for the various changes that have taken place in the situation, allowing for an advantage of 8/- per ton to the factory in view of the lower price offered for beet, from 46/- to 38/-, allowing on the other hand for the increased subsidy, for the fall in the price of sugar and pulp, the fall in the rate of interest on the reserves that the factory draws, and various other factors, they show that there is £44,800 available for distribution as dividends, a sun that is capable of paying approximately 11 per cent. For instance £20,000 will pay a dividend of 5 per cent. on the company's capital. I want to show that there is a simple way of dealing with the figures in order to show that the factory could pay a higher rate. There is a mistake of fact in the figures as they have been issued, and I think that mistake has been accepted by the factory.

There is a mistake of £4,000 in regard to the quantity of sugar manufactured. The factory only estimated on 150,000 tons of sugar beet being handled, whereas they dealt with 160,000 tons. That leaves £48,800 available for distribution. The figures also allow £45,000 for depreciation. That would be sufficient to depreciate the full cost of the factory in nine years, whereas in former years the balance sheet only allowed for depreciation at the rate of £40,000. I see no reason why the factory should increase the rate of depreciation this year. I think the rate of depreciation that existed was more than sufficient. Taking the additional £4,000 that is available for dividends, due to the mistake in the figures supplied, and the £5,000 in the rate of depreciation, we have £54,000 available for the payment of dividends. Examining these figures we get some idea of what the factory could pay. We take it that the factory has paid 15 per cent. dividends which is an unduly high rate in a year of unprecedented economic depression. We think the shareholders could get along nicely with a dividend of 10 per cent. which would leave a surplus of £14,000 available for distribution amongst the beet growers. That £14,000 would allow an extra [2043] 1/9 to the 38/- a ton which the beet growers were to get.

If, however, we say that 10 per cent. is too high the amount for distribution will be correspondingly higher. It might reasonably be put forward that in this exceptional year when there is general depression and when the farming community are particularly depressed, when the farmers who are getting 38s. per ton are probably receiving a price below the cost of production, we might say that 5 per cent. is a sufficient dividend for the factory. That makes available an amount which will allow for a payment of over 4s. per ton extra. Allowing the factory to pay a dividend of 5 per cent., they would be able to pay 4s. per ton extra to the beet growers. The figures with which I have dealt have not taken into account various other items which could be questioned and challenged and which would not bear very close investigation. For instance there has been, as the Minister stated, an estimate of the reduction in the price to be obtained for sugar pulp. With the estimate of the factory for the increased loss on the sale of sugar pulp, the Beet Growers' Association or those speaking for them do not agree. I think that the estimate of the Beet Growers' Association is as likely to be right as is the estimate of the factory. That is, the factory have allowed too great an amount for the fall in the price of sugar pulp.

There is another item which can be questioned. That is the interest that is credited in the balance sheet on the amount shown as reserves. The interest credited for the year 1931 on this amount has been considerably reduced. I cannot give the exact figures as I have not them before me at the moment, but the amount shown as bank interest was lower than in the previous years. It seems to me that the question of allowing interest on the reserves of the company at bank rate is an item on the balance sheet which might reasonably be questioned. The balance sheet shows a very large reserve and a very large amount for depreciation. Are we to understand that that is drawing interest at the ordinary bank rates? It seems to me that, [2044] allowing for a sufficient amount of cash to be used as working capital, it is not unreasonable to expect that the balance of the reserve might have been employed in some such way, which, instead of showing a decrease in the amount of interest, might reasonably show an increase. Taking the figures supplied by the factory itself it can be shown that, at the lowest estimate, they could pay 1/9 per ton extra to the beet growers even after allowing for dividends, while, if they forgo their dividends for this year and allow for interest on reserves and the various figures which I have quoted, they might pay anything up to 6/9 per ton extra. This figure of 6/9 is based on the idea that the factory, allowing for the general depression, would not pay any interest to the shareholders. I do not say that that is a thing we ought to demand or expect from the factory, but we ought to bear in mind that the factories in England—certain of the factories, not all of them, the Anglo-Dutch Corporation I believe—made the offer; I cannot say whether there was an agreement finally entered into—to manufacture sugar beet into sugar on a scale that would allow them nothing for profits, nothing for depreciation, or nothing to go to reserves.

The circumstances are somewhat different here, as has been pointed out by the Minister, but in view of the fact that the English factories were prepared to do that, and taking into account the unprecedented depression and the fact that a very great sacrifice is being asked of the farmer, it would not be unreasonable to ask, and we should certainly emphasise the fact, that the factory should be prepared to suffer some loss, that it should not throw all the losses on the grower, and that the company should be prepared to make some sacrifice, that they should be prepared to make a sacrifice in some way on a level with the sacrifices which the growers of beet are called upon to make.

Having dealt with that aspect, I have to my mind satisfied myself—I am speaking purely for myself and the small Party which I represent at the moment—that the factory can in the circumstances which exist this year, reasonably be expected to make a more generous offer than the offer [2045] which they have made. Undoubtedly the aggrieved party is the Sugar Beet Growers' Association. One must approach it from the point of view of what may be done. I have been listening to the Labour Party whose views were expounded by Deputy Davin, and to the Fianna Fáil Party, for any constructive suggestions of what might be done, and I have not heard a single constructive suggestion which does not involve in some form or another, breaking the contract. I listened to Deputy de Valera, and I heard him say that the Government ought to stand by their own people against, I think the word he used was, outsiders. The Government were asked to take a stand against outsiders. It so happens, in this case, that the factory's representatives are to a large extent outsiders, and the money which is invested in the factory is the money of foreigners, but all the money invested is not the money of foreigners, and all the directors are not foreign directors. Here is the point which I want to make. It is merely an accident, due to the circumstances which existed at the time, that the factory people are foreigners.

Mr. de Valera: I just want to correct the Deputy. I pointed out who are acting unfairly, as admitted by the Minister.

Mr. Heffernan: The question of unfairness does not arise at the moment. The suggestion is that we are told that our Government ought to get behind the people, our own people as against outsiders, against foreigners, to stand for our own nationals as against foreigners.

It is, as I said, a mere accident of circumstances that these people are foreigners. I have no doubt that if the technical skill, and if the money were available at the time here, the Government would have been glad to make a contract with the nationals of our own country, rather than with foreigners. I heard Deputies of the Fianna Fail Party speaking on this Vote in former years, and I heard Deputy Flinn on that occasion complaining that the Government did not take sufficient steps to ensure that Irish capital was [2046] put into the undertaking. It so happens that the factory is largely owned by foreigners, Messrs. Lippens and the other people associated with them, but it might equally happen that the factory might be owned by, say, Messrs. Flinn, Dowdall and O'Shaughnessy. If that did happen to be the case, would we be asked to take up the cudgels for our own people against a hypothetical corporation of hypothetical Irishmen— Flinn, O'Shaughnessy, Dowdall and Company? The situation would be just the same, and here we have this appeal to the prejudices of the people when we are told that the Government should stand for their own people against foreigners.

To my mind the question whether the factory is owned by foreigners or not does not arise. The question is that a contract was made. We are asked to take steps to repudiate that contract. We are asked to introduce an element into the situation which did not exist when the contract was made. The scheme might not have been all it should have been. The contract might not have been as tight with the factory as it ought to have been, but it was the best we could work out then. I am certain that, if suggestions of this kind were made to the factory people, that if we did introduce an additional clause into their contract, a clause for compulsory arbitration, or a clause that in certain circumstances the Government would have the right to buy the factory at their own price, the people who entered into that contract would either refuse to enter into it, or if they did enter into it would demand a much higher subsidy. It is no use playing round the question and suggesting that there would not be repudiation of our obligations, that the sacredness of the contract was not at stake. There is the question, as Deputy de Valera puts it, of fairness. There is no use in playing around these aspects of it, because we cannot introduce elements into the contract which were not in it at the beginning. Who is to judge of fairness? Are the growers or are we to be judges of fairness? If the working of a contract is not supposed to be fair, are we always supposed to violate the contract?

[2047] I, at least, am not surprised that suggestions of that sort come from Fianna Fáil, because, as far as I can gather, their whole policy is based on a repudiation of contracts. A contract is not to be kept unless it suits one party! Every contract that is made, no matter how small or big, even if it is only a question of buying a horse at a fair, can therefore be broken because one party is not quite pleased with the contract. One could very easily heeltap a contract in that way and say “That does not suit me,” or “I did not get fair play.” It is easy to stress it from that point of view. I do not believe in repudiating contracts. I have been pressed very hard by the growers, and I represent a county in which a good deal of beet is grown. I have been told by the growers and their representatives that it would be an unsatisfactory thing for me if I supported this Vote, and if I did not vote against it. I am perfectly aware of that. It will not be a popular thing for me with certain people because they do not fully understand the situation. I believe that in the interests of the country, and even in the interests of the farmers themselves, the best service we can do to the country is to say that we will stand by the contract which we have made, because if we break one contract to-day there is no reason why we should not break another to-morrow.

We have already gone out in the international market to borrow money to finance farm developments such as the Agriculturel Credit Corporation, which provides money for farmers. We are getting that money at about 4½ per cent. If we proceed to violate a contract is there any guarantee that we will get that money in future? If we violate a contract we will not be helping the farmers but working against their interest. If we were to do what we are told by some Deputies “to stand by our own people” we would not in the end be standing by the farmers but in reality working against them. I supported the subsidy for this factory with some reluctance mainly because it was an experiment in industrial production on a large scale in this country. It was also an experiment [2048] which would help agriculture. I am sorry to say that the developments which have taken place have not improved my views on the question of subsidies. We have the leader of the Fianna Fáil Party saying that we should subsidise the production of sugar to meet the requirements of the country. To my mind it is an extraordinary thing that such a policy should be seriously propounded in the Dáil. At present for a subsidy of £3,000,000 we are producing about one-sixth of our sugar requirements. If we are to produce our total sugar requirements under similar conditions it will mean an expenditure of nearly £18,000,000. There would also be a wheat subsidy of £4,000,000 per year.

Where is this money to come from? That is the mystery to me. It means to a large extent that the non-beet growing farmers would be paying the beet growing farmers the subsidy which they are getting. I was more than pleased when I heard the Minister's statement to-day because all my sympathies are with the growers. I believe they have the right in this quarrel and I believe that any support that we can give them within the terms of the contract ought to be given to them. The Minister was not specific in his statement as to what would be done. Probably he was wise. It seems to me that there are considerations which must affect this factory besides the actual contract. Public opinion must affect the factory and it is dead against it. It cannot hope to go on producing in this country with public opinion up against it. I do not think that there is anybody in support of the offer which the factory made and it is not going to be a paying proposition for that factory to go on producing for the next three years or if it intends to go on producing after the present contract expires.

Other questions must and will arise if the factory are prepared to go on; they must keep in touch with the Government on other questions as time goes on. The Government I think ought to make it clear to the factory people and we as Deputies speaking on behalf of the Government ought to make it clear that inside the terms of that contract if there is anything the Government can do to help [2049] the beet growers they will do it. There has been a great deal of capital made out of this question of the difference in the amount of the subsidy paid to the English factories as compared with the subsidy paid to the Irish factory. We have the Minister's figures that the total amount of the subsidy is less than the amount paid to similar English factories. That is contradicted by Deputy Ryan. But they can be examined and I am certain the Minister's figures will bear the closest examination, but that does not now arise. It is not of vital importance whether a bargain could have been made for a less amount or not. The only matter of vital importance is the question of the sacredness of the contract. If we refuse to give our vote for the Estimate we will be violating a contract made by the State. We will be besmirching our national honour. I am not prepared to stand over that, however popular it may be with the beet growers and farmers of this country.

Mr. Corry: We wondered when we heard the argument put up by Deputy Hassett and Deputy Heffernan what they intended doing on this Vote. We heard complaints here on Friday last and again to-day about outsiders interfering and the damage that they were doing. But the damage will be done here in this Dáil this evening if this Dáil passes £162,500 for those very clever gentlemen who having got the best end of the stick are now using it against the farming community. If they are going to get £162,500 out of the farmers' own pockets they can certainly carry on. That big stick that the late leader of the Farmers' Party brought forward—public opinion—bears very lightly on a man who has got £162,500 of the people's money in his pocket. I think Deputy Heffernan, the Parliamentary Secretary, is a very good example of that because the public opinion of the farmers of the country was borne very lightly by Deputy Heffernan in the last four years. That to my mind is the straight question that Deputies have to ask themselves. If they pass £162,500 for the Belgians then once and for all they are preventing any [2050] settlement and it is no use saying that we hope for negotiations. The negotiations are finished once those gentlemen get the cash in their pockets.

We heard any amount of different assurances down in Kildare at the election time as to the negotiations that were going on and how the whole thing was going to be settled. A very striking instance of how the whole thing is being settled was reported last week in the High Court. That is the manner in which the Belgians are going to settle it. Yet we had Deputy Heffernan claiming credit for the great bargain that was made. He helped, he said, to put an industry going on a guaranteed subsidy for ten years. This whole beet growing was in the nature of an experiment. One would think that when you were starting an experiment that you would at least protect everybody concerned, especially when the money is coming out of the people's pockets. But what happened? The Belgian is protected for ten years and the farmer for three. That is the bargain. That is the arrangement that was made. The farming community who, after all, should be our first care, were protected for three years while the Belgian gets protection for ten and then we are told that we cannot interfere.

We have seen here Bills brought in to subsidise men who were fined in the courts. Special legislation was brought in to pay their fines. Money was passed to pay the fines of men who were convicted of assault, but we cannot find any means of bringing in legislation to protect the farming community. I wonder why some retrospective legislation would not be brought in to deal with this case. I think it is a case that would need it. We had Deputy Hassett bewailing the fact that there was a good price for grain in 1924. The prices for grain and barley were going down, but we in Cork had to put up with a bad price for grain ever since and we got no protection. Now, apparently, the price for beet is going to go down, and the farmers who cannot grow beet at the price that is being offered are asked to pay £162,500 to the [2051] Belgians for the pleasure of looking at the factory rusting in Carlow. Surely there is only one remedy. We have any amount of sympathy with the foreigners. You must be a foreigner to get anything in this country. You need only go to Copenhagen to-day. There we have, representing the Department of Agriculture, two Englishmen and a Dane at the World's Dairy Congress.

An Leas-Cheann Comhairle: The Deputy will get another opportunity of dealing with that; he has got to deal with the Beet Sugar Vote now.

Mr. Corry: I will be delighted to get an opportunity of dealing with it.

An Leas-Cheann Comhairle: The Deputy must deal with this Estimate.

Mr. Corry: It is a rather amazing condition of affairs. We had Deputy Heffernan telling us that he was one of those who brought in the proposal, and at the same time he complains that if we brought in a proposal for the whole country we would be taking £18,000,000 out of the people's pockets. He claims credit for taking £3,000,000 but it is a very bad thing if we suggest doing it. This intellectual gentleman also claims credit for the Landlord's Land Bill of 1923, that increased the rent of farmers ten per cent. and fifteen per cent. down the country. Of course it would be a very bad thing for him if that