Committee Reports > List of Committees > Dáil > 1960 > Committee of Public Accounts > Report - Appropriation Accounts 1958 - 1959

MIONTUAIRISC NA FINNEACHTA

(Minutes of Evidence)

Dé Céadaoin, 6 Eanáir, 1960.

Wednesday, 6th January, 1960.

The Committee sat at 3 p.m.

DEPUTY COSGRAVE in the chair.

Mr. E. F. Suttle (Secretary and Director of Audit), Miss M. Bhreathnach, Mr. C. J. Byrnes and Mr. J. F. MacInerney called and examined.

VOTE 45—NATIONAL GALLERY.

Mr. T. McGreevy called and examined.

281. Chairman.—What pictures did you purchase during the year, Mr. McGreevy?—The important purchase was a pair of wings of a Flemish triptych which was in the collection of Judge Moore, Co. Wicklow. We were not able to get the centre panel. We are still trying to trace where it got to. Then, I got what I think was an important small picture by Jean Michelin of a family of country people in France in the time of Louis XIV. It represents the patient life of the people which went on behind the splendour of the Court. It is not easy to get an example. We did not have any acquisition of absolutely front rank importance in that particular year. These two acquisitions were, however, of considerable value from the point of view of the collections. There were other things like drawings but those were the two major acquisitions of the year.

The triptych was owned by George Moore?—No, from the collection of Judge Moore. We got it at an auction in Delgany.

282. Deputy Sheldon.—Are you able to exhibit them?—It takes time. I have pictures already being cleaned in Brussels. When they come back I think I will send these wings of the triptych to the Brussels Institute for cleaning. I really do not want to put them up until they are in a state in which they can be appreciated.

283. Chairman.—Has any progress been made in regard to provision of additional accommodation for the National Gallery or is that more appropriate to the Office of Public Works?—The buildings are vested in the Office of Public Works. Since 1933 I think my Board has been doing all it can. The Governors are usually told that when the present wave of economy is over the National Gallery will get priority.

284. Deputy Sheldon.—Unless something else turns up. Have the sales of reproductions settled at a figure or are they still improving?—This year there was a decided increase in the sales of the coloured cards. The sepia ones went down very slightly. The others are up by £20 on last year.

If you had a proper sales counter, would there be an improvement?—It will all happen by God’s grace and in good time. For the present the man at the door keeps a check on people coming in. He then has to go down and sell the reproductions. Nowadays the sale of catalogues, postcards, etc., is in most galleries a special department. The galleries publish themselves, too.

Do you think it is capable of expansion? If you had better facilities to show the cards, do you think more would be sold?—Of course. The Office of Public Works have made pigeon-holes for us but the system is not ideal.

Chairman.—Thank you very much.

The witness withdrew.

Chairman.—There is a slight change in the order of Votes. We are taking Vote 10 (Employment and Emergency Schemes) before the Department of External Affairs group.

VOTE 10—EMPLOYMENT AND EMERGENCY SCHEMES.

Mr. R. Ó hEigeartuigh called and examined.

285. Chairman.—Paragraph 26 of the Comptroller and Auditor General’s Report reads as follows:—

“26. Provision was made under subhead E. (Urban Employment Schemes) and subhead F. (Rural Employment Schemes) for grants towards expenditure by local authorities on road and amenity schemes, etc., to provide employment. The grants, amounting in all to £260,616 were paid in instalments, during the progress of the various works, by the Department of Local Government acting on behalf of the Special Employment Schemes Office. The accounts of the expenditure on the schemes are examined by Local Government auditors whose certificates are available to me.”

Deputy Sheldon.—There is one point. It really appertains more to the Comptroller and Auditor General than to the Accounting Officer. In paragraph 26 it says, in relation to subheads E. and F.: “The accounts of the expenditure on the schemes are examined by Local Government auditors whose certificates are available to me.” Are we to take it that, in regard to all these other subheads, subheads G., H., I. and J.—the accounting is the normal accounting run inside the Department?

Mr. Suttle.—Yes. The expenditure, except in the case of subheads E. and F., is audited in the normal way.

Deputy Sheldon.—How is it worked where the work is carried out by the county engineer?

Mr. Suttle.—The county engineers work through sub-accounts which are fed by the Accounting Officer. When the works are completed they pass back their accounts to the Special Employment Schemes Office?

Mr. Ó hEigeartuigh.—That is correct.

286. Chairman.—Under the rural improvements schemes is it possible to get a grant for an individual householder or must you have more?—No, you must have two or more. Those for an individual household are dealt with by the Farm Buildings Scheme under the Department of Agriculture. We deal with two or more only.

Assuming that the road is a certain length and is divided, would that come within the grant or not?—That would largely depend on the cost of the short spur to the individual house. For instance, our normal road would probably serve 5 or 6. There may be one house at the very end. One spur road may branch off half-way to one of the individual houses. If the cost of the short branch to the individual house was not unreasonable, related to the cost of the whole scheme serving the 6 households, we would take that short spur road as well and regard it altogether as one scheme. If the spur road to one house was exceptionally costly related to the cost of the whole scheme, we would not undertake it. We would advise the beneficiary in that case that it was solely for his benefit and that he should apply to the Farm Buildings Scheme under the Department of Agriculture.

Deputy Carty.—Are houses the governing factors? Suppose there is one house and six farms—what we call outside farms?—If there were outside farms in addition to the one house, we would undertake the work. If it is for the sole benefit of one individual, it is excluded. If there were three or four outside farms or even a number of outside fields, it would be automatically part of the scheme and we would undertake it.

287. Chairman.—Paragraphs 27 to 30 of the Comptroller and Auditor General’s Report read as follows:—

“27. As shown in the account the Vote provision under subhead E. was fully utilised and was supplemented by moneys made available from the National Development Fund.

28. The expenditure charged to subhead G. (Minor Employment Schemes) and subhead H. (Development Works in Bogs used by Landholders and other Private Producers), amounting to £287,781, relates to schemes administered by the Special Employment Schemes Office. In certain counties these schemes were carried out by the county engineers acting as agents for the Office.

29. The scheme for which provision was made under subhead I. (Rural Improvements Scheme) was also administered by the Special Employment Schemes Office either directly or through the agency of county engineers. The works carried out included the improvement and construction of accommodation roads to houses, farms and bogs, small drainage works, the erection or reconstruction of small bridges, etc. Only works which are estimated to cost not less than £40 are approved and the grants may vary from 50 per cent. to 100 per cent. of their cost. The gross expenditure amounted to £169,089 and contributions by beneficiaries, which are appropriated in aid of the vote, totalled £32,421.

30. The amount charged to subhead J. (Miscellaneous Schemes) includes the cost of improvement works on small fishery harbours and piers carried out by the Office of Public Works on behalf of the Special Employment Schemes Office.”

If there are no questions on these paragraphs we will turn to the Vote itself on page 26.

288. Deputy Sheldon.—In regard to subhead I.—Rural Improvements Scheme —I take it that what the Note, in fact, means is that there was a shortage of staff so that by getting involved in one thing the Department could not do another thing?—What happened in that case is that, at relatively short notice, we were asked to inspect and provide a programme for the Gaeltacht Ministry. We act as their agents. In our capacity as agents we had to inspect the proposals and prepare a specification and so on. It was about the end of November when the details of the individual cases came to our notice and the period from November to March is the busiest time of our year when the Winter programme of our three schemes is normally in progress. In my note I referred to schemes costing £40,000. Actually our engineers inspected 87 cases costing £66,000 odd. Fifty-four out of the 87, costing £42,000, were selected by the Minister for the Gaeltacht and were sanctioned in the five counties of the Gaeltacht. This was at a time when we were put to the pin of our collar to do our normal work and it accordingly left us behind in our rural improvement scheme. As a result we had a much bigger carry forward than normally.

From your point of view I imagine that you hope this will be a nonrecurring business?—We were aware this year, i.e., 1959-60, that we were faced with this job. We knew it at the start of the year and we hope it will not occur again.

289. Chairman.—What marine works are on hand?—These are small piers and slips. Actually the miscellaneous subhead deals with more than piers. For instance, part of the subhead is in respect of a grant for the road to a coal mine in Leitrim. Then there are a couple of thousand pounds for two sports fields, one in Listowel and the other at Carraroe, County Galway. We also deal with archaeological excavations under the same subhead but admittedly the bulk of the subhead is intended for small piers and slips around the coast. The procedure is that county councils pay one-quarter of the cost and undertake to maintain the work when it is completed.

I notice that the rate of progress was slower than was expected. Is there any reason for that?—The engineers in the Office of Public Works were, in that particular year, engaged very largely on a special survey of the coastline at the request of the Swedish engineer in connection with fishing problems generally and they had not staff available for both jobs. We were aware of that beforehand, with the result that a number of schemes were not prepared for submission, and even if the schemes were ready the Office of Public Works would not have been able to undertake them.

290. Deputy Sheldon.—Under subhead K.—Appropriations in Aid—just for the record, I assume that the amounts realised under No. 1 really reflect work done in the previous year and not in this year?—No. The fact of the matter is that the greater portion of the Appropriations in Aid—actually £32,500—is for the rural improvements scheme. It is the contribution made by the farmers. A lot depends on what part of the year the contribution comes in. The moment the money is in we sanction the job. In other words, if the money comes in in April, then within a fortnight of the date of receipt, we issue sanction to our Inspector in the case of the counties which we administer ourselves, or to the county engineer in the other counties where he acts as our agent-inspector to carry out the work. So that normally the contributions lodged from April to December would undoubtedly relate to the year in question. Some contributions received from January to March may fall for execution in the following year, particularly drainage. For instance, we may make an offer now in respect of drainage proposals knowing it would take the representative of the Rural Improvements scheme a couple of weeks, or possibly more, to go around to the farmers getting them to agree to pay. They might not have the cash available. Even if we got the money in February there would be no point in starting a drainage scheme then, and the work would not be started until there was more favourable weather. Generally speaking, however, the bulk of the receipts refer to work undertaken in the same year. Farmers would take a very poor view if we held on to their money for 12 months without doing anything about it.

The reason I mentioned it was because there was underspending on the subhead, the receipts were considerably higher than was anticipated?—To that extent you are correct.

The witness withdrew.

VOTE 59—EXTERNAL AFFAIRS.

Mr. C. C. Cremin called and examined.

291. Chairman.—There are two paragraphs in the Comptroller and Auditor General’s Report about this Vote. They are as follows:—

“Subhead C.1.—Cultural Relations with other Countries (Grant-in-Aid)

100. A number of illustrated booklets in a series on Irish life and culture have been published since 1950 on the recommendation of the Cultural Relations Committee. The expenditure has been met from the grant-in-aid and I have asked for information regarding the cost of publication, sales and stocks.

Irish News Agency

101. The liquidation of the Irish News Agency was completed on 25 March 1959, and the liquidator was discharged by a resolution passed at an extraordinary general meeting of the members of the Company on that date. I have been furnished with a certified copy of the liquidator’s account which shows a cash surplus of £60 which was surrendered to the Department. As indicated in paragraph 91 of the last report no repayments were made in respect of repayable advances amounting to £333,500 issued to the Agency since its formation in 1949-50.”

Have you anything to add, Mr. Suttle?

Mr. Suttle.—In regard to paragraph 100, in reply to our inquiry we were informed that the overall position was that 70,000 booklets had been produced at a cost of £6,800. 26,000 books had been sold and realised nearly £1,800. Nearly 33,000 books have been distributed free and 10,500 booklets are still on hands.

292. Chairman.—How do you intend to dispose of them, Mr. Cremin?—The position is that some of them are held by the publishers who will sell them if there is a demand for them. Others are held by the Department and the majority are abroad in various missions and are still being used for distribution.

293. In regard to the News Agency, how is it proposed to write-off the advances?—The question arises as to whether or not this would require a Supplementary Estimate, which should be taken in the current financial year, before the end of March, or whether it can be dealt with otherwise. It is a matter which we have had under discussion with the Department of Finance on the one hand and which we have been examining ourselves on the other. There is a feeling that perhaps the proper way to dispose of it would be rather by sanction on the part of the Department for Finance than by a Supplementary Estimate, but it is still under consideration. Our idea would be to have that particular point clarified and then take whatever action is necessary. We understand that, if a Supplementary Estimate is required, it would come in before the end of the current financial year.

Chairman.—We turn now to the Vote itself, which is on page 192.

294. Deputy Sheldon.—In regard to subhead A.3.—Incidental Expenses—the Note says that “It was not possible to keep expenditure on the purchase and postage of essential newspapers and periodicals within the amount provided in the estimate”. I wonder if Mr. Cremin can say why it could not be kept within the estimate?—Yes. The real explanation is that the estimate was an underestimate and it has been a matter of some preoccupation to us. This is not the first year this occurred. It happens that we have not succeeded in getting into the estimate what would appear to be a more realistic figure. We have been trying to do that but it was not achieved in the year 1958-59 nor in the year 1959-60. It is just one of these problems where we were conscious of underestimation. It arises primarily in respect of newspapers and publications on which the postage is extremely high. We find for instance that the total cost of this particular item—newspapers purchased for headquarters and for missions abroad—is about £1,500 of which postage is over £1,000. It is a very big part of the total estimate.

In view of that why is it that the same amount is provided for in the current estimate—£1,700?—The reasons are as I have mentioned. We have not succeeded in getting agreement on what we would regard, by reference to actual practice, as a more realistic estimate. That is the explanation. There is a suggestion that we might perhaps be able to compress this particular item but we have not been able to do so. I am afraid it is very unfortunate but that is how it is.

295. Chairman.—To go back to subhead A.3., could the Department of Finance representative say why they allowed the Estimate to be exceeded instead of giving sanction to an increase originally?

Miss Bhreathnach.—I gather from the Accounting Officer that there is a certain amount of disagreement when the Estimate is being framed as to how much we think ought to suffice for the Department of External Affairs, so the usual compromise is that it is fixed as low as we can enforce it and the Department is not always able to keep within that limit, but we keep on hoping it will.

Chairman.—Not an unusual financial approach.

Mr. Cremin.—I might perhaps say, if I may, that the Department of Finance has sanctioned the excess.

296. Chairman.—On subhead D.— Appropriations in Aid—I notice, at the end of the Exchequer Extra Receipts and the details, there is a reference to four addresses in the United States and to an article in an American magazine. Could you say what the addresses were about?—I do not know if I can say precisely what they were about. I know three of them were given by the Ambassador in Washington, one in Miami, one in Syracuse and the third in another city. A fourth was given, in Atlantic City, by the Third Secretary of the Embassy. I think they were primarily on Ireland, on the Irish situation.

VOTE 60—INTERNATIONAL CO-OPERATION.

Mr. C. C. Cremin further examined.

297. Chairman.—On subhead C.6.— Contribution towards the United Nations Emergency Force—was that the contribution in respect of the Suez Force?—That is so. It is the so-called United Nations Emergency Force.

Is there a continuing liability there? —The Force is still there. The liability continues and it appears in the current year’s Estimates and will appear in next year’s Estimates also. I think the amount in the coming year will be rather less than it is here. Of course, the situation in that area remains rather tense and it has been felt better to keep the Force there on the principle that, though it is rather expensive, it is much less expensive than the consequences of, perhaps, withdrawing it and it is not easy to say at this stage when it might be withdrawn and when this particular liability might terminate. It is a contribution on a national basis from each country in the ratio which is laid down for contributions to United Nations bodies.

298. In addition to that were we responsible for payment of our own officers when they were out there?—Yes. You will remember that that was a slightly different Force; it was the Force in the Lebanon and Jordan. That Force is now more or less disbanded but we were responsible for the salaries. Two of the officers have remained on in a body which is not quite the same as that, a body for the supervision of the truce with Israel, and they are also being paid, but other expenses are covered out of United Nations funds.

The witness withdrew.

VOTE 26—AGRICULTURE.

Mr. J. C. Nagle called and examined.

299. Chairman.—Paragraphs 31 and 32 of the Comptroller and Auditor General’s Report read as follows:—

“Subhead M.3.—Payments to the Agricultural Credit Corporation Limited, in respect of loans

31. Reference was made in paragraph 33 of the previous report to advances amounting to £115,000 made by the Agricultural Credit Corporation, Ltd., to the Co-operative Fruit Growers’ Society, Ltd., Dungarvan, and to the undertaking by the Minister regarding repayments, if the Society were unable to meet its obligations. As stated in that report the Society had been unable, owing to its financial position, to pay the instalments of principal and interest as they fell due and payments on foot of the Minister’s undertaking amounted to £37,931 at 31 March 1958 (Principal £14,902, Interest £23,029). An agreement completed in April 1957 provides for the repayments by the Society to the Minister in ten equal annual instalments commencing on 1 May 1958, of the net amount of principal paid to the Corporation on the Society’s behalf together with interest from 1 May 1959 at the rate of 6 per cent. per annum on the balance not repaid by the Society to the Minister by that date. A sum of £4,977 had been repaid by the Society to the Minister in 1956-57 leaving a balance of £9,925 outstanding. The first instalment of £992 was received in the year under review and brought to credit as an appropriation in aid.

The agreement referred to also provides for the waiving of recovery from the Society of the interest amounting to £23,029 plus any further interest paid by the Department to the Corporation up to 1 May 1959. The charge to the subhead includes £2,305 being a half year’s interest to 1 May 1958. I understand that the Society’s financial position enabled it to discharge the interest due to the Corporation on 1 November 1958.

Subhead M.6.—Farm Buildings Scheme and Water Supplies

32. The expenditure is made up as follows:—

300. Chairman.—Paragraphs 33 to 35 of the Comptroller and Auditor General’s Report read as follows:—

“Subhead M.7.—Land Project and Subsidy on Home-Produced Superphosphate

33. The payments made in the year under this head are as follows:—

34. Under section A of the project an occupier of land who undertakes approved work himself is entitled, when the work has been completed to the satisfaction of the Department, to a grant amounting to two-thirds of the estimated cost subject to a maximum of £30 per statute acre. Grants to farmers under this section of the project amounted to £1,389,753 in the year 1958-59 as compared with £1,323,022 in the previous year.

35. Under section B the Department carried out the work on the occupier’s agreeing to pay two-fifths of the estimated cost plus the cost of lime and fertilisers required, subject to a maximum contribution of £12 per acre. Work estimated to involve a charge on public funds in excess of £30 per acre was undertaken only if the agricultural potential of the land warranted it and if the occupier agreed to contribute 50 per cent. of the excess. Work under this section of the project was, except in a few areas, entrusted by the Department to contractors. It was decided to discontinue this section as from 13 November 1958 but to carry out work under agreements entered into by that date. Payments to contractors in the year were £306,734 as compared with £498,555 in the previous year.”

301. On subhead M.7.—The Land Project—can you say approximately how long it takes, after an applicant applies, before work is commenced under the scheme?—At the present time there is a rather long delay because there are a great many applications on hands and the number is tending to rise continuously. The time it takes to deal with an application after its receipt varies, of course, from one area to another. Some counties, for example, Waterford, are reasonably well up to date but most other counties, in different degrees, are awaiting the fulfilment of quite a number of the applications which have been accepted. In reply to the question I would say there might be a time lag of possibly up to year in some cases and I venture to estimate that the average might be something in the neighbourhood of five or six months.

302. Deputy Booth.—Could we have any information as to whether any people who were applicants under Section B have renewed their applications under Section A since the provisions of Section B were discontinued?—We believe a very big percentage of those who had intended to operate under Section B, but whose applications had not been finally accepted at the time Section B was withdrawn, have transferred into Section A. In fact, we asked our outdoor officers to make that suggestion to the section B applicants who could not then be handled under Section B. Perhaps I might add, as a matter of information, that over the last two or three financial years there has been a noticeable increase in the number of people who choose Section A rather than Section B. That seems to have been a natural tendency which was developing of itself. We found that Section A was becoming more popular and the number of applications in the current year, we believe, is going to be an all-time record. That, I may say by way of explanation, is one of the reasons for the delay I have mentioned earlier.

303. Chairman.—When you say an all-time record is it under Section A or under both Sections?—I would say that, combining both our activities, this year will reach a peak.

At what do you estimate the commitments in respect of Section B before it was suspended?—Our commitments at the time of its suspension in November, 1958, were approximately £500,000.

Deputy Sheldon.—Just for the record, what was said there might appear rather odd but it seemed to me as if applications were still being received in the last few years under both heads. Surely since Section B was abandoned no applications would be received under it?

Chairman.—What I intended to ask was whether the present number of applicants was greater than the combined number under both schemes previously? —Yes.

304. Deputy Jones.—Is direct labour payable under Section B or Section A?— Direct labour is Section B, in particular in the counties of Cavan, Sligo, Leitrim, Galway and, I think, Mayo, where the Department did the work direct rather than through contractors.

305. Deputy Sheldon.—Would these be applicants under Section A who were treated as if they had been under Section B?—I think they would have been Section B applicants from the beginning. At least that is my impression.

Was there a delay in getting around all the applications you have received? All I am trying to establish is that no applications were made under Section B since Section B was withdrawn?—The position was that Section B was withdrawn in November, 1958, but it was decided that people who had submitted applications that were approved by that time were entitled, in equity, to have the Section B work carried out for them.

306. Chairman.—Paragraph 36 of the Comptroller and Auditor General’s Report reads as follows:—

“36. The arrangement introduced in December 1956 whereby superphosphate was made available on the home market at world prices continued in operation. Subsidy paid in the year to home manufacturers of superphosphate amounted to £201,931 made up as follows:—

Claims for subsidy are checked at the factories by officers of the Department whose reports have been examined by my officers with satisfactory results.”

307. Chairman.—Paragraph 37 of the Comptroller and Auditor General’s Report reads as follows:—

“Subhead M.M.8.—Fertilisers Subsidy.

37. A scheme to enable phosphatic fertilisers to be sold by manufacturers and importers at reduced prices was introduced from 1 September 1958 and £500,000 was provided by supplementary estimate to meet expenditure in the period to 31 March 1959. The rate of subsidy was £4 per ton in terms of single superphosphate (8 per cent. phosphorus) with appropriate adjustments for superphosphate of other grades and for other phosphatic fertilisers. The reports of officers of the Department, who inspected the records of the manufacturers and importers to verify subsidy claims, were examined by my officers with satisfactory results.”

Has this scheme meant the increased use of fertilisers?—It has. I may say, first of all, when the fertilisers subsidy was introduced, as everybody will remember, we just had an extremely bad summer, a bad harvest, and quite a number of experts estimated at that time that the net result would be a sharp drop in the use of fertilisers in the following year. When the subsidy was introduced some people said: “This might prevent a reduction in the use of fertilisers but maybe it will do no more than that in the first year.” I am very glad to be able to say it has resulted in an increase of 25 per cent. in the use of phosphatic fertilisers which is reasonably satisfactory in the circumstances.

308. Chairman.—Paragraphs 38 and 39 of the Comptroller and Auditor General’s Report are as follows:—

“Subhead M. 11—Bovine Tuberculosis Eradication Scheme.

38. The Bovine Tuberculosis Eradication Scheme, introduced in September 1954 to assist farmers in the eradication of tuberculosis in their herds, continued in operation.

The expenditure under the scheme is made up as follows:—

39. As shown in the account £1,919,544 was charged to this subhead while the sum of £908,088 received from the sale of reactors was credited to appropriations in aid. The balance of the expenditure (gross £250,102, less receipts from sale of reactors £92,914) was met from moneys provided from the National Development Fund thus exhausting the allocation of £653,000 made from the Fund towards the cost of this scheme.”

Could you say how many animals were slaughtered, Mr. Nagle?—The number of cow reactors slaughtered from April, 1958 to March, 1959 was 31,700. In the same period, or rather in the period August, 1958, to March, 1959, we slaughtered 4,500 store cattle reactors. That makes a total of something over 36,000 reactors slaughtered in that year.

Fees to veterinary surgeons, I take it they were in respect of the whole scheme? —Yes, that is the whole scheme.

309. Deputy Sheldon.—I understand there is supposed to be control of animals entering the areas which are being cleared?—Yes.

Is the Department satisfied with the efficiency with which this control is carried out?—If you will permit me, perhaps I should first detail the arrangements we have in force and then evaluate them. We have what we describe as check points along the River Shannon; the River Shannon is the boundary between the area which we hope to clear in the West in a very short time and the rest of the country. We have these check points manned with officials at various points like Athlone, Limerick and so on. So far as we can manage it, in fact, we have them at every point where cattle could physically cross. We find these quite useful. We have detected a number of people endeavouring to bring in cattle without the necessary certificate that they have been tuberculin tested and prosecutions have been taken. We think the control has been reasonably effective, but I should add as a postscript that, in a matter of this kind, we are rather strongly of the opinion that the efficiency of the arrangements and regulations depend finally on the farmers themselves; in other words, while we must do a certain amount of checking on the river, we think the best hope lies in co-operation on the part of the farmers themselves. If we do not have the co-operation of the farmers in the area they will find some way of bringing cattle across. Our line has been, therefore, to say to them: “This is the law and you will be prosecuted if you break it. Surely you will see to it in your own interests that the law is strictly observed because it is only your own interests we are serving.” We think public opinion is growing rather strongly in these counties like Sligo and Clare.

The reason I raised the point is that a farmer at home told me yesterday that he recently bought tested cattle in Dublin; they were all right. But they were brought by lorry around by Sligo into Donegal and nobody stopped the lorry anywhere. The cattle were tested and they were all right but, had they not been all right, there was no one to see whether or not they were all right. The particular farmer was worried from that point of view because he is himself very keen on eradication. I was wondering what type of check there is?—I do not think it would be possible to make a detailed examination of every consignment of cattle. I frankly think that would not be possible at these check points. I am assured, however, that there is a very regular system of checking in operation. I should think, too, that experienced checkers, so to speak, get to know what consignment they should hold up and what consignments are undoubtedly all right.

Chairman.—In this, as in other matters, the Border is the difficulty?—It is.

Deputy Booth.—Do the Garda cooperate in this or is it done purely by departmental checkers? Have the Garda any right to stop a lorry with cattle on it?—Yes, the Garda have full rights under the relevant Order. In fact, most of the prosecutions—at least half of them —brought under the Order have been at the instance of the Garda.

310. Deputy Jones.—On what basis are the supplementary byre and water supply grants made?—The supplementary byre grant was terminated during the financial year 1957/58. I think it was towards the end of that financial year. As in the case of Section B of the Land Project, any applications which had been accepted by the date of termination will, of course, be honoured.

That is the double byre grant?—The double byre grant, yes. The water supply grant comes under subhead M.11. and it is really an extension of the water supply arrangement which comes under subhead M.6. The normal water supply arrangement under subhead M.6. relates to bringing water into the farm kitchen and installing a tap. Its essential purpose is really to relieve drudgery in the home. When the T.B. scheme was introduced representations were made to us that it would be desirable to extend the water supply scheme to enable farmers to bring water into their byres and yards. That is what is covered in subhead M.11.

311. Chairman.—Paragraphs 40 and 41 of the Comptroller and Auditor General’s Report read as follows:—

“Subhead M.12.—Grants for Pasteurisation of Separated Milk, etc.

40. Grants to creameries towards the cost of approved pasteurising plant amounted to £246,897 in the year. This amount was recouped to the Department from the American Grant Counterpart Special Account and was credited to appropriations in aid. (See paragraph 50.)

Subhead M.13.—Payments to Pigs and Bacon Commission.

41. The scheme, introduced in April 1956 to support the price of Grade A bacon exports, is administered through the Pigs and Bacon Commission and is financed from the proceeds of a levy on bacon pigs purchased by curers together with a State contribution. Due to a substantial increase in the average export price of bacon in the year the subsidy payable was less than anticipated.”

Can you say what quantity of Grade A bacon was exported during the financial year?—In 1958/59 the quantity of Grade A bacon exported was 483,000 cwts., which compared with 373,000 cwts. in the preceding year.

Did most of that go to Britain?—I would say 99 per cent.

312. Chairman.—Paragraphs 42 to 45 of the Comptroller and Auditor General’s Report are as follows:—

“Subhead M.14.—Losses on Disposal of Wheat and Payments to Wheat Growers, etc.

42. The expenditure from this subhead is made up as follows:—

43. 132,087 tons of native wheat of the 1956 and 1957 harvests which was surplus to requirements was disposed of through Grain Importers (Éire) Ltd. as animal feed, etc. 80,220 tons of this quantity was sold as animal feed, 25,690 tons exported, 20,357 tons sold to millers to enable them to effect a reduction in the extraction rate, and 5,820 tons sold for the production of biscuit flour. The total loss incurred was £2,052,939 of which £641,322 was charged to the Vote for Industry and Commerce in 1957-58 and the balance, £1,411,617, is charged to this subhead.

44. In view of the effect of the adverse weather on the 1958 wheat harvest it was decided to provide for ex gratia payments to growers in respect of wheat sold to authorised purchasers.

The payments were calculated by reference to the following rates:—

Provision of £300,000 was made by supplementary estimate to meet the expenditure, and pending completion of check of claims £297,337 was paid on account.

45. It was arranged that An Bord Gráin, which was set up under the provisions of the Agricultural Produce (Cereals) (Amendment) Act, 1958, should purchase and dispose of so much of the 1958 wheat harvest as was not suitable for milling into flour. I am informed that 220,000 tons was purchased. £150,000 was paid to the Board on account of the anticipated loss in disposing of this quantity of wheat.”

I take it that disposes of the surplus in respect of 1956 and 1957?—And the 1958 harvest also.

313. What is the average moisture content of the 1958 wheat crop, or is that too technical?—It is not too technical, but I have not got the exact figures here. Frankly, I do not think we have got the final average figure yet. Wheat kept dribbling in up to quite a late date in 1959. It was, of course, abnormally high.

I suppose it was abnormally low last year?—Undoubtedly. Possibly the figure for 1958 is around about 24 per cent., but I should like to check that.

314. What was the total loss in respect of the 1958 harvest?—We had two separate arrangements for the 1958 harvest. One was an ex gratia payment which is referred to in paragraph 44 of the Report of the Comptroller and Auditor General. The estimated total cost of that is now put at £470,000 of which approximately £300,000 was paid in the last financial year; the balance will have to be found in the current financial year. The other arrangement was one in which the wheat from this exceptionally bad harvest—it was, of course, a disastrous one, we never had one as bad before—was taken into the mills, even though it was unmillable wheat, and paid for at a price within the schedule of prices for millable wheat. That schedule is published every year in the Cereals Price Order. Had that not been done, the wheat concerned which was 230,000 tons dried, would have sold only at the feeding prices whereas, under the arrangement made by the Government it was purchased through the mills at a price within the legal schedule of prices for millable wheat less, of course, the levy of 5/9d. per barrel. That wheat was then passed on to An Bord Gráin and disposed of for feeding—at a loss of course. We have not got the final results of the loss from An Bord Gráin yet, but it will be rather substantial I should think. The gross loss will probably not be far short of £1,000,000. From that, of course, must be deducted the proceeds of the levy, amounting to approximately £700,000, and the Exchequer then will bear the difference; we estimate that to be about £270,000. I think it is fair to say, therefore, that the total cost to the State of the assistance given during this emergency harvest will be £470,000 plus £270,000.

Nearly £750,000 altogether?—A total of £740,000.

315. Chairman.—Paragraph 46 of the Comptroller and Auditor General’s Report reads as follows:—

“Subhead O.6.—Grain Storage (Loans) Act, 1951.

46. The Grain Storage (Loans) Act, 1951, empowers the Minister for Agriculture to grant loans for the provision and equipment of storage for grain, the total of loans being limited to £2,500,000. The terms of issue are set out in paragraph 40 of the report for the year 1954-55. Loans advanced to 31 March 1959, including £33,000 in the year of account, amounted to £596,200. Repayments amounting to £56,819 received in the year were credited to appropriations in aid.”

Deputy Jones.—How many applications would the £33,000 expenditure under the Grain Storage (Loans) Act, 1951 cover in the year ended 31st March 1959?—The total number of loans, is it, Deputy?

No, the loans advanced to 31st March 1959. The figure for the year of account is given as £33,000. How many loan applications were there?—There were two, Deputy, one of £15,000 and one of £18,000.

316. Chairman.—Paragraphs 47, 48, 49 and 51 of the Comptroller and Auditor General’s Report come next. They are as follows:—

“Subhead P.—Subsidies on Dairy Produce

47. The expenditure from this subhead is made up as follows:—

48. It was decided that one-third of the loss on exports by the Committee of the surplus of the 1958 season’s butter should be charged to the Dairy Produce (Price Stabilisation) Fund and a payment of £649,423 from the Fund to the Committee is referred to in paragraph 51. The full loss on exports of butter produced prior to 1 May 1958 falls to be borne on the Vote.

49. The loss on exports in the year ended 31 March 1958 amounted to £3,063,441 of which £2,761,315 was charged to the Vote in 1957-58 and the balance £302,126 is charged to this subhead.

Dairy Produce (Price Stabilisation) Fund

51. The rate of levy on creamery butter manufactured on or after 1 April 1958 was increased from 9s. 8d. to 26s. 8d. per cwt. and resulted in an income to the Fund of £1,179,551 as compared with £438,653 in the previous year.

The payments from the Fund were as follows:—

I suppose the dry year last year will have a significant effect on the butter subsidy?—It had. We really had two years which affected it in a sense. If I may go back for a moment to 1958, that year was a very wet year and milk production remained quite good until August, 1958. The weather got even worse then and production fell off rather rapidly. That was followed by the very dry summer of 1959. The milk production situation changed considerably over those two years.

317. Deputy Moloney.—I am rather at sea about the three different headings in paragraph 47 of the Report of the Comptroller and Auditor General. One heading is payment of a sum of £1,298,846 in respect of two-thirds of the loss on exports in the year ended 31st March, 1959 of 1958 season’s butter (i.e., produced in the year 1st May 1958 to 30th April 1959). Do I take it the production period does not coincide exactly with the period of the financial year and, if so, for what reason are they not the same?—I think the explanation of the different periods here is that, in fact, this arrangement for charging one-third of the export losses to the industry itself dated from when it was introduced, that is, 1st May, 1958. Up to that date the Exchequer bore the full losses.

318. With regard to the particular fund, if it is appropriate, Mr. Chairman, to deal with it at this stage, might I ask is it possible that, during the current year, there is a surplus unexpended as a result of the fact that the exports were almost nil and does that surplus remain and come into account as a credit?—The accounts of the Price Stabilisation Fund which are published in this Volume show a credit balance at the end of March, 1959 of £140,800, including the special levy. Subsequently, it was decided to withdraw this levy, I think with effect from 1st June, and some money had accumulated between the end of March and 1st June, and remains in the Fund but that money can only be used for one purpose in the future and that is for subsidising the exports of butter, which we fervently hope can be resumed within the next year or so.

319. Deputy Cunningham.—Is any part of that subsidy used in advertising or in sales organisation?—No. Nothing was paid out of this levy for such purpose.

320. Chairman.—Paragraph 50 of the Comptroller and Auditor General’s Report reads as follows:—

“Subhead R.—Appropriations in Aid

50. Reference was made in paragraph 46 of my previous report to an agreement dated 17 June 1954 between the Governments of Ireland and the United States of America providing for the use of the balance, £6,000,000 approximately, in the Grant Counterpart Special Account for the benefit of the Irish economy. The agreement provides for the negotiation of subsidiary agreements which would contain detailed specifications of the nature of the projects agreed on, including a budget and a plan of expenditure in each case. The amounts allocated under the various subsidiary agreements in respect of projects sponsored by the Department of Agriculture together with recoupments from the Special Account up to 31 March 1959 are shown in the following statement. The amounts recouped were credited to appropriations in aid.

The allocation to the Agricultural Institute will be accounted for in the accounts of the Institute.

I notice that the statement shows that about £5,000,000 was allocated for agricultural purposes. Can you say, Mr. Nagle, are there any further projects envisaged. I refer to the counterpart arrangement with the United States of America. The details are on page xxii. Are there any other projects, besides these ones, envisaged?—No, I think that is a full list of our projects. There is a provision, I think, in the agreement with the United States Government under which a reserve fund was set up in case any of the projects on which it had been agreed we should go ahead cost more than the original estimate, but, so far as I remember, this reserve fund can only be allocated for the projects approved in the agreement itself. So far as my Department is concerned, this list in paragraph 50 would be complete.

321. Chairman.—We can now turn to the Vote itself.

Deputy Moloney.—In respect of subhead E.1., I notice the expenditure was £12,814 less than the amount granted. That is in respect of seed testing, propagation and certification, etc. Could I ask how does that arise. I know it is explained in the notes, but could we have amplification?

Chairman.—There is a note on subhead E.1. on page 63.

Deputy Moloney.—I know. I have read that note but it does not give me quite the information I require.

Chairman.—Can you amplify the note on page 63, Mr. Nagle?—There were two main reasons. The more important of these was the fact that because of the wretchedly bad summer the quantity of stock seed wheat produced under the seed certification schemes was much less than had been estimated on a normal year basis, so that the amount of money which the Department had to expend in the purchase of this special stock wheat grown by selected growers was much less than we expected. May I add that there is not really, so to speak, a gain to the Exchequer here because there will be a corresponding reduction in Appropriations in Aid, not in the financial year 1958-59, but in the current financial year, because we will have less of this wheat to sell.

322. What is Thorndale used for now? —It has been decided to erect a second pig progeny testing station at Thorndale. As you know, there is one already in Cork.

323. Deputy Moloney.—On subhead F.2.—Grants to Private Agricultural Schools, etc.—the Note says that capital grants amounting to £7,406 were not earned before the close of the year, that the remainder of the saving was due mainly to vacancies in students’ places. What type of agricultural schools are allowed those grants?

Deputy Booth.—It is set out in the Estimate, I think, Mr. Chairman, is it not?

Mr. Nagle.—There is a list given in the Estimates. I could give the name of each school if that was desired.

Chairman.—I think we have it.

Deputy Moloney.—The names of the schools are given but is there a certain qualification? A college may be doing a limited course in agricultural science. Does it qualify? I know that the number of schools is set out in the list.

Chairman.—Are courses prescribed?——Practically all these schools are not ordinary secondary schools. They are agricultural schools proper, where a student goes in the second half of his teens for a year, in some cases now for two years, but there is an odd case where we do give assistance to a secondary school which runs approved courses.

324. Deputy Booth.—On subhead G.3., the Note on page 64 says that the principal savings were £7,400 on grants to poultry-keepers, etc. Does this mean that there was just a reduction in enthusiasm so far as the raising of additional poultry stocks was concerned?— Exactly so. I think the rather depressed state of the poultry industry in that year really explains the lack of enthusiasm for further capital investment in the way of housing, etc.

Is that anticipated to be a passing phase, just because of market conditions? —We would hope so. A great deal would depend, of course, on the market prospects in Britain and, I suppose, on the policy followed in that country with regard to their own egg and poultry production.

325. Deputy Jones.—In regard to subhead M.6.—that heading covers both new buildings and improvement of existing buildings?—It does.

In respect of existing buildings, might I ask Mr. Nagle on what basis is the grant paid? Is it on the basis of the labour costs above or do the materials enter into it?—For the most part the grants really were based on the estimated labour content but, in the case of the water supply scheme, they are based on the total estimated cost, of which we pay 50 per cent., subject to a maximum grant of £100. On the other hand, while the buildings grants were originally based on the labour content, there have been various amendments from year to year, generally in the direction of an increase, so that at the present moment, strictly speaking, they are not 100 per cent. based on the labour content only, I would say. For example, the grants for silos were practically doubled last year, the original grant having been based on estimated labour content but then doubled.

The one I was interested in, Mr. Nagle, was where cow-byres have been improved and have been reconstructed and at the present time it seems to me the reconstruction grant available to the farmer who does the work is based on the cost of the labour involved and that the materials do not enter into it?—Yes. That is true, but during the financial year under review, also, the grants for repair of byres were, in fact, doubled. That was partly to compensate for the withdrawal of the double byre grant for new byres. We were then advised that in many cases existing byres could be improved and made perfectly safe from the point of view of infection but that the rather big attraction which then existed for putting up a new byre, because of the double grant, tended to make most people opt for a new byre. It was decided then to ease the blow caused by the withdrawal of the second leg of the double byre grant by strengthening the grants for improvements and repairs.

326. Deputy Moloney.—In connection with subhead O.7., I would like to ask Mr. Nagle if his Department is satisfied that value is obtained for the expenditure involved in this subhead, that is in connection with the allotments? My information in that connection is that the Department of Local Government comes into this matter from the point of view of administration and that there is a certain amount of overlapping which, if it could obviated would lead to greater efficiency on schemes in districts where it is operated at the moment through local authorities and certain approved voluntary societies. The amount is small but the principle involved is big. I wonder would Mr. Nagle clarify the point I have raised?—We endeavour to maintain good co-ordination with the Department of Local Government and the local authorities concerned and, of course, we do help as regards the instruction of those who are using the allotments and on the whole I would say the scheme is worthwhile, especially from the point of view of the unemployed persons who constitute the majority of the participants. My figures here show that, in 1958, 3,434 allotments were taken up by unemployed people and 548 by employed persons. The scheme has the complexion of a social service but I suppose one could take the view that, if a person is unemployed, it is all to the good that he should have some form of constructive labour to perform while he is seeking a position.

The point I wanted to make is mostly in connection with the supervision of this. The Department’s officers who are charged with the responsibility of supervision certainly do the best they can but they have large areas to cover and cannot get around frequently enough. It occurred to me that if it were possible to allocate supervision to officers of the County Committees of Agriculture it would mean more frequent inspection and they would be men with local knowledge and I feel it could be a greater success. I wonder if Mr. Nagle could give us the benefit of his advice in that connection? —We would certainly be very glad indeed to look into that and see if something could be done along these lines. It just occurs to me, in passing, that most of these allotments congregate around large urban centres and maybe that is one of the difficulties about bringing in the county staff but we shall be very glad to look into it.

327. Chairman. — On subhead Q.— Technical Assistance—what is the general nature of expenditure undertaken? —As you know, this is financed from the Grant Counterpart Fund under an agreement with the American authorities. We discussed with them individual departmental projects which might be desirable under the funds allocated to ourselves as well as to other Departments. We then drew up a programme lasting four or five years with the general approval of the American authorities. Generally, speaking, we concentrated here on sending technical officers away for short and medium term periods not for years but maybe for three, six or nine months. In addition to that we allocated a certain amount of the technical assistance funds to the Universities or rather to the constituent colleges of the National University and also to Trinity College who drew up their own programmes, and finally we have made another appreciable allocation from the funds to the Agricultural Institute which was recently established. I would say so far as our own technical officers are concerned, where we think there is any gap in knowledge or any interesting developments about which we would like to know more, we try to send people abroad for these particular purposes both to improve their own technical ability and to make more information available generally to the Department itself.

328. Deputy Moloney.—Is there any part of that money allocated to County Committees of Agriculture for the purpose of facilitating those bodies to send their agricultural officers or instructors abroad or to obtain certain technical information which from time to time would be desirable?—There is, and I am glad to be reminded of that, if I may say so. You will have observed another subhead of the Vote, Educational Tours for Instructors in Agriculture which showed no expenditure. The reason is that these tours are now paid for from another subhead. We have a regular annual programme for county agricultural and county horticultural instructors for trips abroad which will now be paid for out of subhead Q. One team went to Denmark, I think, another to Holland and another to Britain.

What percentage of the total is it intended to pay or has been paid in the past or is it intended to allocate for that particular purpose?—For the counties?

Yes, approximately?—This would be very approximate. Our general aim is to try to send away, not all the instructors every year but to send away, say, a quarter of them every year, and in that way to go through the full number gradually. I would say that the cost of sending a team of agricultural instructors abroad would vary according to the country they visit—one year it might be to Britain and that would not be so costly; another year it might be to the continent and we may have as many as 30 or 40 in that particular group and expenditure would amount to a few thousand pounds.

Apparently an agricultural instructor would get out every two or three years? —That is our general aim and policy.

329. On the Appropriations in Aid there is an item there, sales of creameries, £35,000 estimated—realised, £35,076. While the amount realised is more than the amount estimated, I would like Mr. Nagle to tell us what sales of creameries took place, what type of creameries and for what reason during the period?—This is, I think, £35,000 under Exchequer Extra Receipts. I think it is interest rather than the sales of creameries. This figure represents interest paid to the Department by the Dairy Disposal Company on the amount of State capital which is invested in the company. I would admit that “sales of creameries” is rather a misnomer; it is rather a misleading description.

Deputy Moloney.—I am just reminded by a more experienced member of the Committee that it can be dealt with later on.

330. Chairman.—We have had circulated the audited balance sheet and reconcilement statement of the Dairy Disposal Company and associated companies. I think members got it during the week *.

331. Deputy Booth.—When would it be correct to deal with the notes at the end of this Vote on page 70—

Chairman.—We are at Appropriations in Aid. If there is any matter which the Deputy wishes to raise he may do so now.

Deputy Booth.—On page 71, I note that fines amounting to £146,485 were incurred by holders of milling licences. This amount appears to me to be enormous. Does it mean that there was very widespread failure by holders of milling licences to take into store the specified monthly quantities of home-grown wheat? If so, is the Department satisfied that the amount of the fine is sufficient or is there a widespread disregard of the provisions? An amount of that magnitude in fines rather frightens me?—I must say we do not attribute any great blame to the mills under this heading because it is really, to a large extent a technicality. What happens is that traditionally we fix rather early in the season, by Order, the percentage of home-grown wheat quotas. These are deliberately fixed, if I may say so, too high. At that time we do not really know the full outcome of the harvest which is not known for months, but what is essential is to avoid any possible breakdown in the flow of wheat into the mills or in the free reception of wheat from growers by our mills. I think what happens is that we rather overdo the percentage and, technically, if the miller does not comply with that he is liable to fines, but we must accept that the fault is ours although the fault is committed in a good cause.

forced; otherwise we would have to do enforced?—No, they were never enforced; otherwise we would have to do what is almost impossible; we would want to know early in the harvest what is going to come in. We cannot foretell.

It is a target figure rather than an absolute one?—It is, yes. We have to err on the safe side and it has this side effect that under the law technically the millers should pay a big fine but we are guilty in that case and it would not be fair to ask them to pay the fine.

332. Chairman.—In respect of the accounts of the Marketing of Agricultural Produce (Grant-in-Aid) the expenditure was relatively small. Is that due to the fact that the reports had not been completed?—I remember—maybe I should not draw attention to this— in my last examination here I was asked a similar question by another member of the Committee, and I think my explanation was that, in the financial year 1957-58, the Marketing Committee was in its early youth and that, maybe in 1958-59, the expenditure would increase considerably. I know the explanation now, I think. We had received quite a number of the reports of the Marketing Committee before the close of the financial year 1958-59 and the reports of the committee showed that they took the view that it would be better to allocate some of the £250,000 to the new marketing boards which they recommended—for example, for dairy produce, bacon and turkeys— for the purpose of market exploration. The Marketing Committee considered that this would be preferable to the Committee itself undertaking elaborate market investigation involving the physical export of large quantities of produce and all kinds of commercial arrangements which would be really more appropriate to a commercial organisation. Therefore, in effect, the advisory committee suggested that the new Boards be given a substantial slice from the £250,000 as a nest-egg for market development. That is really the explanation of why the committee seems to have been rather parsimonious in spending the money themselves.

333. Chairman.—I mentioned already that the auditors’ report on the Dairy Disposal Company Limited has been circulated. I think Deputies got it during the week *.

Deputy Moloney.—I wish to raise a few points because I have not been on this committee before and this is new to me. Secondly the part of the country I represent is mostly covered by the Dairy Disposal Company creameries. In connection with the issued capital of 20,000 shares of £1 each—I want to know who took up those shares?—The issued capital amounts to just over £20,000 and the position there, I think, is that, with one exception, the associated companies of the Dairy Disposal Company are financed by loan capital and, therefore, their issued capital is really of a nominal character and it is held for the most part on behalf of the Government by the Government nominated directors of the Dairy Disposal Company. In one case there was an exception to that and that was the former Cleeves Confectionery of Limerick which controlled the toffee factory in that town. This factory was formerly part of the assets belonging to the old Condensed Milk Company of Ireland and when the shares of the Condensed Milk Company were acquired by the Dairy Disposal Company the toffee factory was sold and the purchasers formed a company known as Cleeves Confectionery Limerick, Limited. It was a private company with share capital of £20,000 and mortgage debentures. The would-be purchasers of this business defaulted at the time in respect of the balance of the purchase money due to the Dairy Disposal Company and the shares of Cleeves were then acquired for the sum of £100. That is the explanation of how the issued capital of such a substantial amount came to be called up in the case of Cleeves factory. In other words, the Dairy Disposal Company is a semi-Governmental organisation—perhaps we could say analogous to such boards as the Electricity Supply Board—and their capital was originally derived from the State. At the present time, the company having grown, it is self-financed so I think it is right to say the share capital enters very little into the financial arrangements of the company. If the Deputy wishes I can give the issued capital of the respective companies which make up the grand total.

No, I think the explanation is quite adequate. I take it that the actual payment for the shares came substantially from Government sources directly or indirectly?—Certainly.

Those shares did not carry any dividends—they were purely nominal investments?—Yes.

334. On page 62 there is a figure of £35,000 for sales of creameries. Evidently that is incorporated in the account under discussion?—Yes, the £35,000 would be charged to the profit and loss account of the Dairy Disposal Company.

335. I take it it is a payment made to the Exchequer on an annual basis more or less to recoup the interest on certain advances made for the acquisition of creameries, etc. It does not contain any capital?—No. It does not relate to the share capital in any way. What happened was that a determination was made of the liability to the Exchequer of the Company some years ago and that determination indicated a figure of nearly £600,000 and it was agreed then that the Company should pay interest at the rate of 6 per cent. per annum on approximately that amount.

The capital still remains outstanding? —The capital remains outstanding. I may add that while we could also ask for repayment of advances we are inclined to think the present arrangement is the better one under which the Dairy Disposal Company finances capital development out of its own resources. If they paid back the advances, in due time no doubt we would have to advance futher sums for capital purposes.

The witness withdrew.

The Committee adjourned.

* See Appendix XX.

* See Appendix XX.