No. 411 NAI DT S14134D

'Notes of discussion with the Taoiseach and Ministers on 19th September' with memorandum 'Points for Decision'

London, 19 September 1947

Following the Meeting with members of the British Cabinet,1 the Taoiseach, the Tánaiste, the Minister for Finance and the Minister for Agriculture reviewed the situation for the purpose of giving directives to the Irish officials present in London. In particular the document entitled 'Points for Decision' annexed was under consideration.

The following were the main points decided:-

  1. To meet a request for figures (head 1 of 'Points for Decision') we should take the line that there is still in existence in Ireland a strict Foreign Exchange Control on the same broad lines as the United Kingdom control and that on the best estimate of our requirements of foreign exchange for nine months, 1/10/47 to 30/6/48, the total is that shown in Col. (2) of the Estimates prepared departmentally viz., about £64 mil. for trade and non-trade purposes. We may disclose such of the details comprising that figure as seem desirable.
  2. With regard to the question of reductions in the estimates of £64 mil. the fundamental point to be observed is that no indication of savings can be given until the Irish Government has knowledge of what the United Kingdom is prepared to do in the way of furnishing essential supplies to enable our agricultural and industrial output to be increased. We may mention that the total estimate includes provision for about £10 mil. of dollars which could be saved if alternative supplies of the commodities in question are made available from the sterling area, chiefly the United Kingdom.
  3. Any indication of savings of foreign exchange expenditure that might be feasible, i.e. the £10 mil. which were suggested by departments in the Circulated Estimate, Col. (3) should not be given unless the British have firmly bound themselves to make available certain supplies, e.g., coal, and to make price concessions for Irish goods in the British market. It would not be necessary for a comprehensive agreement to be reached with the British on all outstanding supplies and trade matters, before indicating willingness to make reductions in foreign exchange expenditure. Agreement on some important points would be sufficient to enable the Irish Delegation to be accommodating on the foreign exchange aspect.
  4. It was recognised that the British may contend that the settlement of the trade issues may take a little time, that the dollar savings are urgent, and that, in any event, some portion of our foreign exchange expenditure which may be susceptible of reduction is not dependent on the outcome of the bilateral talks and has no direct bearing on our desire to increase productive capacity. The answer to this is that (a) there are political considerations involved which make it difficult for the Irish Government to ask their people to submit to austerities and sacrifices without being able to tell them at the same time that there is an assurance definite and binding, of better supplies and better terms from the United Kingdom, and (b) that the circumstances of Ireland are different from those of the United Kingdom, and that some savings which can be made in the United Kingdom cannot be carried out in Ireland without a relatively greater degree of sacrifice and upset to national economic interests.
  5. Any vague or indefinite assurance regarding supplies, etc., from the British side would not be enough. Experience shows that they have not been helpful in the past, nor have fulfilled undertakings. It will be for Messrs. Leydon and Ó Broin to bring home these points so far as is necessary. Mr. Ó Broin is to press very hard to get rid of differentials against Irish products.
  6. The question of purchases in 'soft' currency areas in Europe should be fully discussed as we require to be convinced as to the need for limitations on expenditure in countries like France.
  7. It was emphasised that the Irish Delegation should give nothing away in regard to any possible claim that might be put forward from the British side which would imply restriction on our entitlement to the full value of our sterling assets. We must contend that the British are bound to meet our claims in sterling either by adequate supplies from their own production or by granting us facilities to enable purchases of essentials to be made elsewhere.
  8. The discussion of the detailed items under Head 4 of 'Points for Decision' was inconclusive. The intention is that provided the discussions develop satisfactorily, firm decisions will be taken by the Irish Government on Friday, 26th September, as to the items in regard to which we may agree to reduce dollar expenditure and also expenditure in other currency areas. There seems to be general agreement among the Ministers that items (a), (b), (d), (e), (f), (k) (within limits), (n), (o), (p) and (q) might be the first objects of reduction in expenditure.
  9. The Ministers agreed that in the course of any general statement we were free to express full recognition of the difficulties arising out of the dollar crisis and to say that we would do our utmost, in a spirit of goodwill, to help in the solution of these difficulties, which are matters of common concern to all countries in the sterling area.

'Points for Decision'2

  1. May we produce to the Treasury, as our basis Foreign Exchange Payments programme for 9 months, the total, and such major constituents as seem desirable, as shown in column (2) of Circulated Estimate, prepared by Industry & Commerce, Agriculture and Finance, totalling £67 million for Trade and Non-Trade purposes?3
  2. May we disclose all or some of the reductions suggested by the Departments, and point to the possibility of reducing the total of £67 million to £57 million as shown in column (3) of the Circulated Statement?4
  3. May we go further than (2), if necessary, and then indicate the possibility of further economies, which might reduce the total Foreign Exchange requirements for nine months to £45 million, of which about one half would be dollars?
NOTE:
Foreign Exchange requirements are given above in gross and take no account of our earnings of foreign exchange estimated at about £7.5 million for nine months, of which £5.5 million would be dollars.



  1. If it is desired not to give any comprehensive figure for possible economies, but merely to indicate some measures we intend to take to curtail our preconceived programme for the nine months, decisions are required on the following, in particular.
Saving
(a) May we eliminate dollar expenditure on breakfast foods £ .12 million
(b) May we eliminate dollar expenditure on raw, dried and canned fruits5 .86 '
(c) May we suspend purchases of sugar, except for 27,000 tons already contracted for 1.25 '
(d) May we eliminate preserved fish6 .12 '
(e) May we cut tobacco (already intimated to manufacturers) 20% cut .52 '
(f) May we eliminate dollar cigars .04 '
(g) May we eliminate dollar private cars .35 '
(h) May we eliminate dollar piece goods and apparel 2.88 '
(i) May we cut petrol by 20%7 on present consumption .18 '
(j) May we cut newsprint .27 '
(k) May we eliminate (dollar) travel for pleasure .6  
(l) May we eliminate or drastically reduce maize .52 '
(LL) What about cutting wheat, as overestimated prospect8 ----  
(m) May we do without butter imports .91 '
(n) May we cut wines etc. to 50% of pre-war in quantity .90 '
(o) May we eliminate foreign chocolates and sweets .55 '
(p) May we eliminate or drastically reduce all fancy goods, watches, camera films, luxury glass ware, etc. .5 '
(q) May we say that we will consider arrangements to reduce dollar outgoings on film royalties by 50%9 .15 '

1 See above No. 410.

2 This version of the memorandum is taken from file NAI DT S14134A as the version includes marginal notes by de Valera.

3 Marginal note by de Valera: 'Yes'.

4 Marginal note by de Valera: 'after…' [unreadable].

5 Marginal note by de Valera: 'Subject to our share'

6 Marginal note by de Valera: 'Yes'.

7 Amended by de Valera to 10%.

8 Marginal note by de Valera: 'no'.

9 Marginal note by de Valera: 'consider'.


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