Committee Reports > List of Committees > Dáil > 1937 > Committee of Public Accounts > Report - Appropriation Accounts 1935 - 1936

MIONTUAIRISC NA FINNEACHTA

(Minutes of Evidence)

Déardaoin, 25adh Mí na Samhna, 1937.

Thursday, 25th November, 1937.

The Committee sat at 11 a.m.

Members Present:

Mr. J. Maher (representing the Comptroller and Auditor—General), Mr. J. L. Lynd, Mr. C. S. Almond (An Roinn Airgid) were called and examined.

1327. Deputy Smith.—I move that Deputy McMenamin be Chairman of the Committee pending the arrival of Deputy Dillon.

Question agreed. Deputy McMenamin took the Chair accordingly.

VOTE 39—PUBLIC RECORD OFFICE.

Mr. J. F. Morrissey called and examined.

1328. Chairman.—There are no queries on this Vote. How are the Public Records getting on?—We are getting the usual increment. We did not get as much in the way of purchases last year or the year before or the year under consideration, but they are progressing. They are building up a collection again.

1329. It is a very tedious, difficult job?—It is not a thing to be done in a day. It will take years upon years to get them together again.

1330. Of course some things will never be got?—There are some of them that can never be replaced. A number of them cannot be replaced.

Witness withdrew.

VOTE 53—FISHERIES.

Mr. S. O Broin called and examined.

1331. Chairman.—Paragraph 52 of the Report of the Comptroller and Auditor-General states:—

“Including the advances charged in this account, the total advances made to the Sea Fisheries Association to 31st March, 1936, amount to £66,273 12s. 6d. The half—yearly instalments of the annuities set up to repay these advances, falling due up to 31st March, 1936, amount to £11,933 17s. 2d., whilst the sums collected by the Sea Fisheries Association from borrowers and transferred to the Department in payment of the annuity instalments amount to £7,779 17s. 2d. The annuity instalments were, therefore, in arrear at 31st March, 1936, to the extent of £4,154.”

1332. For how long in arrear were these sums? They were scattered over a period of time?—Yes.

1333. Can you give us any idea of how long the oldest of them were outstanding? —The oldest of them would not be more than five years, I would say.

1334. They are five years old?—Some of them. The Sea Fisheries Association started operations about 1931, and on the setting up of the Association an entirely new method of providing fishermen with boats and gear was adopted. The new method was a hire—purchase arrangement with the fisherman, under which the fisherman pays as he earns. If the fisherman did not earn anything, of course the Sea Fisheries Association did not get any money. On the other hand, if the fisherman did well, the Association collected a substantial sum. That was the arrangement between the Sea Fisheries Association and the individual members. The arrangement as between the Department and the Sea Fisheries Association is that when advances are made to the Association, annuities are set up designed to extinguish the debt within a period of 20 years.

1335. That is between the Department and the Sea Fisheries Association?—Yes.

1336. If they failed to get any money from the fishermen how are they to discharge the annuities?—Of course if they do not get money from the fishermen, they have no means of discharging the debt to the Department.

1337. You are not liquidating the debt, then, are you?—Well, the results so far are as shown here in this note of the Report of the Comptroller and Auditor—General. There was an arrear on the 31st March, 1936, of £4,000 odd.

1338. Has there been an accumulation of debt since?—The arrear at the end of 1937 was a few hundred pounds more than that.

1339. Is that what is due by the Association to the Department?—Yes.

1340. The annuity machinery whereby the debt is to be liquidated in 20 years is that much in arrear now. What takes place if it is not paid to the Department? —So far there has been no special action necessary, really.

1341. Has not the advance been made on a basis whereby the debt will, be wiped out in 20 years?—Yes.

1342. If the annuity is not paid, how does that system function? How does he machinery work?—Of course the period of 20 years is very far from having expired, and if fishing were to become more profitable than it is at present, we would expect to do far better. We would expect to overtake these arrears.

1343. What I want to know is how does this accountancy go on? The debt is not being extinguished?—Just at the moment there is an arrear, but that arrear would be wiped out if the fishing industry recovered.

1344. This 20 years may be any 20 years?—It might. It is 20 years from the issue of the amount.

1345. Do you know how much is owing by the owners of boats to the Association?—I am afraid I have not any information as to that.

1346. Chairman.—The Comptroller and Auditor—General has the following note under the heading “Fishery and Industrial Loans”:—

“As noted in the account, the Minister for Agriculture, with the consent of the Minister for Finance, has made conditional remissions amounting to £6,511 15s. 10d. under Section 2 of the Fisheries (Revision of Loans) Act, 1931, and has written off as irrecoverable under Section 4 of the Act, sums amounting to £359 1s. 5d. The balance outstanding on these loans at 31st March, 1936, amounts to £41,025 12s. 4d., including arrears of £39,625 0s. 10d.”

Are those old obligations?—They are. Those are the old loans.

1347. Are those people members of the Sea Fisheries Association?—I daresay some are, but I am not quite sure of that.

1348. Are they then under a double obligation, for those arrears and also the new commitments of the Sea Fisheries Association?—If they are members of the Sea Fisheries Association, and have obtained facilities from the Association, they would be under a double obligation.

1349. You cannot say whether those people who owe that £39,625 0s. 1d. are also people who owe a part of the present debt accumulated by the Sea Fisheries Association?—I am sorry I have not that information.

1350. Is there any hope of recovering this sum of £41,025 12s. 4d.?—Well, we are making recoveries. We are getting in sums all the year through.

1351. We will now turn to the Vote, on page 157. In regard to sub-head E (2) —International Council for the Study of the Sea—is this sum a contribution to the Council?—Yes. The sub-head also includes the travelling expenses of a delegate to a meeting of the Council.

1352. Sub-head E (3) deals with Sea Fisheries Protection. I understand that you are acquiring a new destroyer?—We are.

1353. The negotiations are not yet complete?—They are practically complete.

1354. You have not taken delivery?—Not yet.

1355. In regard to sub-head F (2)—Fish Hatcheries—are you doing much in that line?—The items of expenditure under that head are indicated in the Estimates for the relevant financial year.

1356. But, with regard to that work, are you tending your hatcheries as far as possible?—We are carrying on the hatcheries we have had for some years past, with the exception of the Black Castle hatchery on the Boyne, which has been dropped.

1357. Why was it dropped?—We did not consider that we were getting an adequate return for the expenditure.

1358. We now come to sub-head F (3) —State Fisheries. To what does that refer?—Those are fisheries which the Department manage on the Owenea in Donegal, and the Owenduff in Mayo.

1359. Those are rivers in the congested districts?—Yes.

1360. Under sub-head G (1) there is an item of £11,000—Cost of Administration (Grant-in-Aid). You gave them £11,000?—Yes.

1361. Did they, out of that £11,000, discharge their obligation to you on foot of annuities?—That £11,000 is a Grant-in-Aid of the cost of administration. It actually covers the cost of staff.

1362. Did they require that much?— In the year 1935-36 they required £9,700 —a sum of £1,300 less than was estimated.

1363. Did they not use portion of that to discharge their annuity obligations to you?—That would be scarcely regular.

1364. Perhaps they could not do it?—I do not think it would be quite regular.

1365. They got it for a specific purpose?—Yes, and they could not apply it to another purpose.

1366. Sub-head G (2) refers to a General Development (Grant-in-Aid). How is that money spent?—That is a sum of money which enables the Sea Fisheries Association to engage in various activities for the purpose of developing Sea Fisheries—such purposes as encouraging the public demand for fish, propaganda purposes and so on.

1367. Do you think anybody got any value for that money?—I think the Sea Fisheries Association would maintain there was value obtained for it.

1368. How did they spend the money? I do not think I ever saw even a poster?— The general attitude of our Department towards the Sea Fisheries Association naturally is to give them as much latitude as possible.

1369. I admit all that, but what did they do with this £10,000?—They have, for instance, propaganda vans in the country.

1370. What do they do?—They bring fish around to districts where fish is not obtainable, and try to get the people to acquire the habit of buying fish. Of course, in the early stages of running such a van, there would be a certain amount of loss.

1371. To what extent are they doing this, or where do they go with the fish?—They have runs from Dublin to various parts of Leinster and the Midlands. That is an illustration of one side of their general development activities.

1372. With regard to sub-head G (3)—Advances for Boats and Gears—is that by the Association to its members, or by you to the Association?—That is by us to the Association, and then they make their own arrangements as regards the advances to their members.

1373. You cannot say whether they actually advanced this £12,000 or not?—I cannot say whether they advanced the whole of it.

1374. Do they not make a return to you of their actual advances?—They generally apply to us for money under this sub-head when they need it. The Association applies to us for an issue out of the sub-head, and they generally have to accompany that application with an indication to show that it is well-grounded.

1375. There is a note in reference to sub-head G (4) which says: “The scheme for the erection of a purification plant for mussels is in abeyance until there is reasonable certainty of access to the desired markets in Great Britain.” I understand that the reason of the uncertainty of access to the British markets was that we had not a disinfecting tank. Perhaps it was that even if you had a tank you had no guarantee that they would take them?—That is the position.

1376. Deputy O’Reilly.—The medical officers of health in Ireland and in Great Britain have, perhaps, different standards? —The question of admission into the markets in Great Britain seems to be a matter entirely for the local medical officers of health.

1377. Chairman.—The same would apply here in the Free State?—That is so.

1378. Every medical officer is supreme in his own area?—I think so.

1379. Deputy O’Reilly.—And even they may have different standards?—Yes.

1380. Chairman.—The explanation in regard to sub-head A is that the saving in that case was due mainly to vacancies caused by deaths and changes in staff. In the case of sub-head B, which deals with travelling expenses, it is set out that the travelling in connection with public inquiries, etc., was less extensive than was expected. In the case of sub-head C, dealing with incidental expenses, the explanation is that the additional expenditure was incurred on the advertising of export bounty schemes. Did you pay bounties generally on fish of all kinds, and did they include salmon?—That is in a separate Vote. We pay bounties on lobsters, fresh-water eels, fresh mackerel, shell-fish, and so on.

1381. Do you pay the full tariff?—It has varied. The present position, as a matter of fact, is indicated in the Report itself.

1382. In the case of sub-head G (2), dealing with General Development (Grant-in-Aid), the explanation is: “Some of the contemplated development schemes of the Sea Fisheries Association did not come into operation and portion of the provision was consequently saved.” What development was that?—I am sorry I have not got that information with me.

1383. The explanation for sub-head H, Appropriations-in-Aid, includes the following paragraph: “Repayments in respect of fishery loans were more satisfactory than was anticipated.” That is a satisfactory thing. Has that been continued?—It has

1384. It is very satisfactory. You estimated you were going to get £800 and you realised £1,444 7s. 1d?—Yes.

1385. With regard to the sales of boats, are these old boats?—These were old boats given over to us by persons who had borrowed from us.

1386. There is a paragraph here with reference to the lettings of sporting rights and the sales of fish. You estimated £500 and realised £890. In that connection, with regard to these sporting rights you have on these estates, are you doing anything about protecting and restocking them?—Yes, we provide adequate protection for them.

1387. Do you do anything about restocking?—We maintain the stocks. We always give attention to that.

1388. Various things happen, abnormal things happen, with regard to sporting rights, where birds die or change and leave the place derelict. Are you doing much with regard to the destruction of vermin?—These are fisheries and we are concerned with the sporting rights in that connection only, not with the general sporting rights.

1389. Then as regards the other branch, is that connected with the Department of Lands?—Yes, the shooting rights on property.

1390. Do you not work in conjunction? Take the case where the river runs through a moor, do you not work in conjunction there?—We have bailiffs to look after the rivers.

1391. Assuming that the river runs through the moor, have you gamekeepers along with bailiffs?—We would not be concerned with the game; we are concerned only with fish. The game would come under the Land Commission.

1392. I think it is bad business. Surely those two things should come under the same authority, under the one Department?—They are not under the one Department; they are under two different Departments.

1392a. They should be under the same Department, because they relate to the one thing. You should have a senior man at the head who would see that the gamekeepers and bailiffs did the work. You should have central responsibility? —At the moment they are not under the one Department. I think the matter you refer to would be one for the Minister.

1393. Deputy Linehan.—Is it not a fact that there are not gamekeepers under any Department who would correspond with the water bailiffs?

Deputy Walsh.—The Land Commission takes charge of the sporting rights on the land.

Deputy Linehan.—Possibly, where they have taken over estates; but in general, we have bailiffs under the conservators on every river, but we have no such thing as gamekeepers under any Department preserving other game.

Chairman.—There should be one central Department in charge of them.

Mr. Dillon took the Chair at this stage.

VOTE 70—EXPORT BOUNTIES AND SUBSIDIES.

Mr. S. O. Broin further examined.

1394. Chairman (Mr. Dillon).—There is a note in connection with this Vote, made by the Comptroller and Auditor-General, and it reads as follows:—

“With the exception of bounties and subsidies on exports of industrial products administered by the Department of Industry and Commerce, all the expenditure borne on this Vote was administered by the Department of Agriculture. An analysis of the expenditure is appended to the Appropriation Account, and further details, with my observations thereon, appear in the succeeding paragraphs.”

Mr. Maher.—The first point is that paragraph 99 relates to bounties and subsidies on exports of industrial products paid from the Department of Industry and Commerce, and the Accounting Officer for Agriculture is not, of course, responsible for these payments. The question arises whether you will be satisfied with any explanations which I may be able to offer on paragraph 99, or whether you would consider it essential to call the Accounting Officer for Industry and Commerce. In previous years, I think the Committee were satisfied with the explanations given by the Audit Office in relation to bounties on industrial products.

1395. Chairman.—Would it meet the views of the members of the Committee if we were to proceed immediately with the bounties relating to the Department of Agriculture, and then we can consider note 99 in the light Mr. Maher indicated?.

1396. Deputy Walsh.—I think we should stick to the established procedure.

1397. Chairman.—It is not necessary to detain the Accounting Officer for Agriculture, in any case. We might as well dispose of the matters relating to that Department, and then we can determine the other at our leisure. The Report of the Comptroller and Auditor-General on the subject of bounties and subsidies on exports of fishery products reads:—

100. The payments under this heading related to the following:—

The rates of bounty authorised were as follows:—

Lobsters—75 per cent. of the British Import Duty paid.

Other Shell Fish-Periwinkles and Mussels—100 per cent. of the British Import Duty paid.

Escallops—50 per cent. of the British Import Duty paid.

Fresh Water Eels—50 per cent. of the British Import Duty paid.

Fresh Herrings—100 per cent. of the British Import Duty paid.

Pickled Mackerel—25 per cent. of the price per barrel f.o.b. Irish Ports, received by exporters on consignments to places outside Great Britain and Northern Ireland.

1398. Chairman.-In previous years, we had some comment to make on the way in which the accounts relating to those bounties and subsidies were kept. Has there been any alteration in the method of keeping the accounts in respect of bounties and subsidies since then?

Mr. O Broin.—I have consulted the accountant, and he does not recall any request for an alteration in the form of the accounts.

1399. Chairman.—I seem to remember a case in which there was some miscarriage which gave rise to proceedings in the Central Criminal Court and in which the judge made some reference to the way in which the accounts were kept. Is not that so?—That was a case in which a clerk in the office acted in collusion with a claimant for bounty.

1400. I think that is so?—The position following that case was thoroughly over-hauled and is now, I think, quite satisfactory.

1401. The accounts have been made as foolproof as possible?—The procedure for paying the moneys has been made quite satisfactory.

1402. Sub-head C—Bounties and Subsidies on Exports of Agricultural Produce. Bounties on Exports of Live Stock: Paragraph 101 of the Report of the Comptroller and Auditor-General.

“The bounties paid on exports of Live Stock amounted to £445,514 16s. 10d., viz.:—

The rates of bounty authorised were: Cattle.

From 1st January, 1935, to 18th February, 1936—20s. per head on cattle 2 years old and upwards.

Live Pigs.

Live pigs exported over the land frontier into Northern Ireland with or without quota certificates:—

From 21st May, 1934—10 per cent. ad valorem.

Live pigs exported through Saorstát ports to Great Britain with quota certificates:—

From 3rd December, 1934, to 27th October, 1935—28 per cent. ad valorem.

From 28th October, 1935, to 9th February, 1936—⅓ per cent. ad valorem.

From 10th February, 1936—25 per cent. ad valorem.

Live pigs exported through Saorstát ports to Great Britain without quota certificates:—

From 3rd December, 1934, to 4th August, 1935—22½ per cent. ad valorem.

From 5th August, 1935, to 6th October, 1935—25 per cent. ad valorem.

From 7th October, 1935, to 27th October, 1935—28 per cent, ad valorem.

From 28th October, 1935, to 30th November, 1935—32 per cent. ad valorem. From 1st December, 1935, to 9th February, 1936—30 per cent. ad valorem.

From 10th February, 1936—20 per cent. ad valorem.

Live pigs exported via Northern Ireland to Great Britain with or without quota certificates, and live pigs exported to countries other than Great Britain or Northern Ireland:—

From 4th November, 1935, to 30th November, 1935—30 per cent. ad valorem.

From 1st December, 1935, to 9th February, 1936—30 per cent. ad valorem.

From 10th February, 1936—20 per cent ad valorem.

Horses.

From 1st August, 1934, to 18th February, 1936—20 per cent. of the value of the horses as assessed for British Customs duty on all horses exported to Great Britain and Northern Ireland. No bounty to be paid in respect of any horse the value of which, as assessed for British Customs duty, is less than £10.

Sheep and Lambs.

From 1st April, 1934, to 31st December, 1934—2s. 6d. per head.

The dicontinuance of the bounties on cattle and horses exported to the United Kingdom followed on the reduction in the British import duties imposed by the Irish Free State (Special Duties) Act, 1932.”

Chairman.—What was the reason for the variation from month to month in the export bounty on live pigs? Was that in conformity with some particular scheme?—It depends largely on variations in price and other circumstances of that kind.

1403. Chairman.—Perhaps Mr. Maher could help us in this connection. There is no statutory duty on the Minister to pay any standard rate of bounty.

Mr. Maher.—That is the position. These are not statutory bounties. They are payable at the discretion of the Minister, subject to certain conditions such as, for example, notification to the Minister for Finance of any alterations. I think that the full answer to the last question put to Mr. O Broin would be that the frequent alterations in the rates of bounty on live pigs are due to the surplus or shortage of pigs, fluctuations of price and exigencies of the British quota.

1404. Chairman.—Could Mr. O Broin tell us if advertence was had to the levies made by the Pigs Marketing Board from time to time when these rates of bounty were being fixed, or was that matter considered at all?

Mr. O Broin.—That matter would naturally be present to the minds of the people dealing with these bounties, but I do not think it would be a factor that would enter very prominently into the consideration of the rate of bounty.

1405. Chairman.—I shall tell you quite plainly what the purport of my question is and you will be able to decide whether it comes within your discretion or not. What I want to find out is whether reductions were made in this export bounty in order to allow the levies made by the Pigs Marketing Board on pigs to help in the matter of compensating exporters of pigs?—I am afraid I should have to look into that matter to see to what extent that factor entered into consideration in the fixing of the levies or bounties in particular cases. I could not give the information offhand.

1406.* I am aware, as I think the other members are, that you are answering on behalf of Mr. Twomey, who is indisposed, and, therefore, not in a position to answer himself. I do not care to press you too strongly when you have not all this information at hand. I should be glad, however, if you would look into the question as to how far these export bounties interlocked with the levies and bounties paid under the Pigs and Bacon Act. Perhaps you would be good enough to let us have a note on that subject at your convenience?—I shall.

1407. Bounties on Exports of Live-stock Products. Paragraph 102 of the Report of the Comptroller and Auditor-General:—

“The total amount paid in respect of bounties on exports of live-stock products was £652,536 16s. 5d., made up as follows:—

The rates of bounty payable were:— Pig Products.

Bacon, Hams, and other cured pigs’ meat.

All Exports.

From 3rd December, 1934, to 9th June, 1935—20/- per cwt.

Exported for consumption in Great Britain and Northern Ireland, and to countries other than Great Britain and Northern Ireland, or the Isle of Man:—

From 10th June, 1935, to 4th August, 1935—20/- per cwt.

From 5th August, 1935, to 20th October, 1935—15/- per cwt.

Exported to Great Britain and Northern Ireland for ships’ stores, and to the Isle of Man direct or through Great Britain or Northern Ireland:—

From 10th June, 1935, to 20th October, 1935—10/- per cwt.

All Exports.

From 21st October, 1935, to 2nd February, 1936—12/- per cwt.

From 3rd February, 1936—15/-per cwt.

Pork.

From 3rd December, 1934, to 4th August, 1935—12/- per cwt.

From 5th August, 1935, to 2nd February, 1936—10/- per cwt.

From 3rd February, 1936—12/- per cwt.

Plucks.

From 26th September, 1932—5/- per cwt.

Calf Skins.

From 1st April, 1935, to 31st May, 1935—12/6 per skin.

Mutton and Lamb.

From 11th June, 1934, to 30th November, 1935—16/- per cwt.

Beef and Veal.

From 20th September, 1935—5/- per cwt.

The prohibition of the import of beef and veal into the United Kingdom, referred to in paragraph 90 of my last Report, remained in force. The payments made were in respect of consignments to the Channel Islands.”

Chairman.—That relates to the figure of £70 11s. 9d.?

Mr. Maher.—To the last two rates. I have not got the exact figures but it probably relates only to the figure you have mentioned.

1408. Chairman.—These rates apply to exports of beef and veal to the Channel Islands?

Mr. Maher.—Yes.

1409. Chairman.—The same observations I made in regard to the export bounties on pigs interlocking with the levies would apply to pig products—the first item here.

Mr. O Broin.—Yes. I have noted that.

1410. Chairman.—I take it that the Channel Islands were the only alternative market found during this accounting period for exports of beef and veal?—I think they were the only market to which there were such exports.

1411. Bounties on Exports of Dairy Produce. Paragraph 103 of the Report of the Comptroller and Auditor-General:

“The expenditure under this heading amounted to £636,342 2s. 2d., viz.:—

The authorised rate of subsidy on exports of creamery butter was the sum necessary to bring the average price received by exporters to any market, plus the statutary bounty payable under the Dairy Produce (Price Stabilisation) Act, 1935, up to the net return obtainable on the home market, provided that the average rate of subsidy on all exports over the season did not exceed 27s. per cwt.

The rates of subsidy paid on exports of creamery butter to the United Kingdom were:—

The average rate of subsidy paid on all exports during the season 1935-36 was 23s. 1d. per cwt.

In connection with the continental trade, an official scheme for the purchase and sale of butter was administered by the Dairy Disposal Company, Ltd., which was, as in previous years, indemnified against loss. A total quantity of 17,763 cwts. of butter was purchased, at a cost of £127,031 0s. 1d. Belgium imported 11,065½ cwts., Germany 6,182½ cwts., and Northern Ireland 417½ cwts., while 97½ cwts. were sold on the home market. The net receipts from sales amounted to £75,237 13s. 0d., and payments of bounty from the Dariy Produce (Price Stabilisation) Fund totalling £16,196 7s. 4d. were made to the Company. The sum necessary to recoup the cost of the butter purchased was £35,596 19s. 9d., of which £30,407 3s. 8d. is charged in this account. Included in the expenses charged against the scheme are sums of £838 17s. 0d. and £408 2s. 2d. for interest on overdraft and commission on sales, respectively.

This amount also includes ’payments amounting to £7,337 4s. 2d. in respect of claims relating to the official scheme in operation during the previous year.

The subsidy payable on exports of non-creamery butter was subject to the proviso that the average rate on all exports over the season should not exceed 23s. per cwt. Varying rates were paid, the average on all exports being 22s. 3d. per cwt.

As in previous years, the rates of subsidy paid on exports of other milk products were fixed in such a manner that the receipts to the producers of these commodities were approximately equivalent, on a milk basis, to the receipts that would have been obtained if the milk had been used for the production of creamery butter.”

Chairman.—Are we to understand from that that, after the bounty had been received by the Dairy Disposal Company, Limited, they actually lost £35,596 19s. 9d. on their transactions.

Mr. O Broin.—I do not think it means that. That only gives a partial view of the transaction. You would really want to have the full account before you to follow out the figures properly.

1412. Chairman.—As I understand, when the transactions were concluded it was found that there was a deficit of £35,596 19s. 9d., and that that was made up by a subsidy. The facts are that the Company bought butter for which they paid £127,031 0s. 1d., the quantity being 17,763 cwts. They sold that butter and got from the purchasers £75,237 13s., after all expenses had been paid. They then got under the Dairy Produce (Price Stabilisation) Act, 1935, statutory bounties of £16,196 7s. 4d. paid out of the Butter Fund and that left them with a loss of £35,596 19s. 9d., but they were still entitled in the ordinary course to apply for an export bounty from the Exchequer?—That is so.

1413. And the export bounty from the Exchequer was fixed by the Minister at such a figure as exactly to equate the loss that had been made?—Yes.

1414. I should like to know when that sum of bounty was fixed of £35,596 19s. 9d.; was it greater or less than the rates of subsidy paid on exports of creamery butter to the United Kingdom in the several months referred to on page 40 of the Comptroller’s note?—To answer that in detail would involve an examination of the accounts. We have not got the details here, but we can supply them if you wish.

1415. Deputy Smith.—Did we not get the impression the last day that the payment by way of bounty in respect of butter disposed of through that source was less than that payable on butter sold otherwise?—That is in respect of consignments sent to the Continent between April and August, 1935. The net returns were greater than the returns that would have been got had the butter been exported to Great Britain.

1416. Are we not dealing with the disposal of butter in much the same way and to largely the same places?—Largely to the same places, but over a longer period.

1417. It is merely a matter, Mr. Chairman, of your wanting to know whether this amount of £35,596 19s. 9d. represents a larger subsidy than that paid for the period in respect of other butter sold in the normal way?

Chairman.—Precisely. My suspicion is that whereas if you or I were exporting butter, our bounty would be paid on our invoices just as they went out, but that in this case at the conclusion of the 12 months’ dealing, it was found that there was a deficit of £35,596 19s. 9d., and the Minister granted to this Company, which he was quite entitled to do because he has absolute discretion, a lump subsidy just sufficient to balance the account.

Deputy Smith.—That seems to be a very natural suspicion for you.

Chairman.—Yes, but I want it cleared up.

Deputy O’Reilly.—Was there not a guarantee that that would be done?

Chairman.—I want to find out whether it was in fact done, or whether these consignments were dealt with as the consignments of any exporters of butter or a co-operative creamery would be dealt with.

Mr. O Broin.—We can easily ascertain whether the subsidy payable was greater than the normal bounty payable on normal exports during the same period.

1418. Chairman.—The average rate of subsidy paid on all exports for this period was 23/1 per cwt.

Deputy Smith.—That did not refer to creamery butter but to home manufactured butter.

Chairman.—If the Deputy will look at page 40 of the Report, he will see there a statement:—“The average rate of subsidy paid on all exports of creamery butter was 23/1 per cwt.”

Deputy O’Reilly.—What you want to find out is whether, in this latter case, it was greater than 23/1?

Chairman.—Yes.

Deputy Linehan.—On 17,763 cwts., a subsidy of 23/1 would be something like £22,000, whereas the total here seems to me £35,596 19s. 9d. plus £16,196 7s. 4d.

Chairman.—If you left out the last part of your observation, you would touch exactly the point I am trying to reach.

Deputy Linehan.—The point I want to get at is that on these 17,000 cwts. they got payments of bounty and then they got the rest as export subsidy.

Chairman.—They got £16,000 odd under the Dairy Prices Stabilisation Act —and everybody got that—and they got £35,000 odd in addition. That seems to be substantially in excess of the average subsidy paid on all exports and, therefore, I should like to know what was the rate of bounty paid in each month in respect of exports by the Dairy Disposals Company, Ltd.

Deputy O’Reilly.—If we do find it out and it is greater or less, it does not make any difference. Was there not a guarantee to this company that there would not be a loss?

Mr. O Broin.—The Dairy Disposals Company were acting as agent for the Minister in this transaction and were guaranteed against loss.

1419. Deputy O’Reilly.—Therefore, it does not matter to us, because there was a guarantee. Whether the subsidy was greater or less than 23/-, there was a guarantee.

Chairman.—It would be our duty to inform the Dáil of what the loss was.

Deputy O’Reilly.—I am not saying that that is not your duty, but the clear explanation is that no matter what the subsidy might be, there was a guarantee.

Mr. Maher.—I understand the position to be that the subsidy to be paid to the Newmarket Dairy Company was such sum as would bring the net receipts up to the purchase price. My impression is that there was no definite rate of subsidy so long as the net receipts were brought up to the purchase price.

1420. Deputy Smith.—And that was the price prevailing on the home market?

Mr. Maher.—The purchase price of the butter was a definite determined figure without any relation to the price in the home market at the time of export, because they had purchased the butter for £127,000. They got, in receipts from that, £75,000 odd and the statutory bounty of £16,000 odd, leaving £35,000 to be paid from the subsidy under the agreement.

Chairman.*—Is it agreed that we ask Mr. O Broin to look into the accounts at his convenience and let us know the rates of bounty paid in each month on exports by the Dairy Disposals Company, Ltd?

1421. Chairman.—The next note by the Comptroller and Auditor-General deals with bounties on exports of poultry and eggs and sets out:—

“The payments amounted to £419,432 4s. 6d., viz.:—

The rates of bounty sanctioned were:—

Eggs (not in shell).

From 1st May, 1933, to 31st December, 1934, and from 1st April, 1935—Frozen liquid eggs or frozen whites or yolks of eggs—12/6 per cwt.

Dead Poultry.

From 1st January, 1935—Turkeys, 3d. per lb.; Other poultry 3½d. per lb.

Live Turkeys.

From 25th September, 1935, to 31st January, 1936—Equivalent to the British duty.

In paragraph 92 of my last report, I mentioned that as from 8th April, 1935, reduced rates had been prescribed for dead poultry and eggs (in shell) exported under bond, in respect of which satisfactory evidence of payment of British Customs duty was not forthcoming, and also for eggs (in shell) exported to the Isle of Man.

The rates were:—

Eggs (in shell) exported under bond—3d. per gt. hundred.

Eggs (in shell) exported to the Isle of Man—1s. per gt. hundred.

Dead Poultry exported under bond —2d. per lb.

The expenditure under the heading of eggs includes sums amounting to £18,500 14s. 8d. paid in respect of exports to Spain. The rates of bounty in force from 1st April, 1935, were payable on these exports up to 1st July, 1935, when a reduction of 3d. per great hundred in each grade was made.

Chairman.—Were those bounties paid on exports of eggs to Spain paid to a company operating as the Government’s agent or to private exporters?—To private exporters.

1422. Do I understand that that trade agreement with Spain under which these eggs were exported has been suspended? —There have been no exports to Spain for a considerable time.

1423. And I understand that the restrictions on imports into Saorstát Eireann of oranges have been raised?— I understand they have.

1424. How many exporters were engaged in the export of eggs to Spain?— They were not very many. I cannot say precisely how many offhand, but my recollection is that there were very few.

Mr. Maher.—The exact number was nine registered concerns, and sub-quotas were allowed to each.

1425. Chairman.—Did any condition attach to the payment of these bounties that these exporters would deal in any other commodity, or take return cargoes from Spain, or anything of the kind?— I am not aware that we attached any such condition to the payment of the bounty.

1426. Chairman.—The next note by the Comptroller and Auditor-General deals with bounties on exports of other agricultural products and sets out:—

“The payments under this heading totalled £36,938 13s. 7d., viz.:—

The following rates of bounty were authorised:—

Potatoes.

Exports from Scheduled Districts. To the United Kingdom:—

Exports from other Districts.

To the United Kingdom:—

To France:—

To other countries:—

Extra Receipts payable to Exchequer.

These receipts relate to the recovery of amounts paid in previous years.”

Where did these potatoes go to?—They were exports to the United Kingdom.

1427. Only to the United Kingdom?— These relate only to exports to the United Kingdom.

1428. Did the Department require proof of delivery of these potatoes before paying the bounty?—I think so. Before paying the bounty we always try to secure as conclusive evidence as possible of the course of the transactions, where the commodity went, and whether there was duty payable or not. Any relevant evidence of that sort is always looked for.

1429. Was there any obligation on persons exporting potatoes between the 1st July, 1935, and the 31st August, 1935, when there was a bounty of £2 a ton paid on imports into Great Britain, to prove delivery before receiving the bounty from our Government?—We would require evidence that they did before paying the bounty.

1430. Mr. Maher.—I think they are only paid on the bill of entry on the consignment, which is conclusive evidence of the entitlement of the exporters to the bounty.

1431. Chairman.—No bounty was paid until that was produced?

Mr. O Broin.—That is so.

1432. You will observe that between the 1st July and the 31st August, 1935, the bounty on exports of potatoes was substantially greater than the price offered at the alcohol factory in Northern Ireland so that it would have paid to ship the rather than cart them to the alcohol facory?—They would not be paid bounty under these circumstances.

Deputy Smith.—The time of the year makes a great difference.

Chairman.—I would sooner get £2 a ton for dumping them into the sea than 35/- on carting them to the alcohol factory.

Deputy Smith.—Is that so?

Chairman.—Yes.

Deputy Smith.—That demonstrates how much you know about the whole matter.

Mr. Maher.—I understand when potatoes are exported they must be graded.

1433. Chairman.—Were there any conditions as to grading at this time?— Potatoes for export are subject to rather strict supervision. They have to be graded and put into bags, which are sealed under the supervision of an officer of the Department.

1434. It is a condition that all potatoes are sealed when exported?—Yes.

1435. Do you tell me that no potatoes were exported and bounty paid unless they were in bags sealed under the Department’s supervision?—Exporters are supposed to be registered, and their premises are supervised by Inspectors of the Department.

1436. I would be amazed to hear that all potatoes shipped in respect of which bounties were paid were graded and sealed in bags under the supervision of the Department?—Certainly the supervision is very strict as regards seed. As regards ware, the conditions are similar.

1437. Chairman.—I know that conditions as to sealing are strict, but I would be amazed if such precautions were taken with regard to ware.

1438. Chairman.—Deputies will note that the surplus under this Vote was surrendered as not having been expended.

1439. Mr. O Broin.—I should like to qualify a statement I made at the last meeting. There was an inquiry as to the medium of publication of the results of veterinary research, and I mentioned the Department’s Journal. I find that the Department’s Journal is not the only medium of publication. The results of research are published in professional journals which are taken by veterinary surgeons.

1440. Chairman.—They are normally communicated to the professional journals?—That is the more general practice. Some appear also in the Department’s Journal.

1441. We are very much obliged to you for attending here.

The following note appears in connection with sub-head A—Bounties and Subsidies on Exports on Industrial Products:

The total amount paid under this heading was £82,315 2s. 4d., of which £1,175 12s. 5d. related to a subsidy of 6d. per ton, in addition to bounty, on the exports of macadam and gravel. I am in communication with the Department of Industry and Commerce on certain matters arising out of my test examination of the bounties paid.

The question arises, before we ask Mr. Maher to amplify that, whether we should ask the Accounting Officer of the Department of Industry and Commerce to explain it. It seems a small matter in respect of which to send for the Accounting Officer, and I suggest that in future we should take the note of the Comptroller and Auditor-General when the Accounting Officer is accounting for his Department, if that could be arranged. Do you not think it would be the sensible arrangement? I think we can dispense with Mr. Leydon’s attendance unless Mr. Maher has something to say.

Mr. Maher.—The first part of the paragraph relates to the payment of subsidy in addition to bounty. That is rather unusual. Consequently, the Comptroller and Auditor-General felt that he should call attention to it. The second part refers to certain matters on which we were in communication with the Department. These matters have since been satisfactorily settled. One related to the export of repaired omnibus springs upon which the British levied a duty other than the duty under the British Imports Act, 1932. Strictly speaking, bounty and subsidy is paid only on duties levied by the British authorities under that Act. The duties on the repair of omnibus springs were levied under a different Act, and we asked the Department of Industry and Commerce to obtain the sanction of the Minister for Finance. That sanction has now been furnished to us. The second matter relates to a subsidy paid on the export of silk. It was exported to Great Britain and a duty was levied under the British Finance Acts. In that case the covering sanction of the Department of Finance has since been obtained.

1442. Chairman.—I think we might ask Mr. Leydon to explain the circumstances under which subsidy was paid in addition to bounty.

Mr. Maher.—The explanation, so far as we have been informed, is that a granite company, to which this bounty was paid, would be unable to export granite to Liverpool unless they got these facilities. I understand this Liverpool company operates in the Saorstát.

1443. A Liverpool company?—I understand it has Liverpool connections and is operating in the Saorstát.

1444.* Chairman.—I would be glad if we had a note from the Accounting Officer setting out the circumstances under which that was done. For the sake of clarity, it would be better to ask for a note, so that we would have justification for this, and put it on the records of the Committee. Otherwise, it might give rise to doubt hereafter. It would be as well to ask Mr. Leydon for a note explaining the circumstances under which bounty and subsidy was paid on the one commodity. That disposes of the accounts.

* See Appendix XVIII.

* See Appendix XIX.

* See Appendix XX.