President,¹

Sometime ago Mr. Henry J. Moloney, K.C., in the course of a casual conversation mentioned the question of Land Commission Annuities and suggested that in view of the considerable relief which farmers in Northern Ireland were receiving under the de-rating proposals a case might be made for some concession from the British Government in the matter of Land Commission Annuities in Saorstát Éireann. I think this suggestion must have originally emanated from Devlin² but I am not quite sure. The main basis of the argument was that the special financial treatment of Northern Ireland both in regard to de-rating and to the remission of the annual contribution to the British Exchequer was rendering the possibility of a united Ireland more remote. I said to him that so far as I could see the proposal was not a sound one - that we had elected to become a self-governing dominion and that we could not have our cake and eat it. I must say that I did not pay very much attention to the proposal and I was surprised to receive from him a few days ago a letter and memorandum, copies of which I enclose,³ in which he goes into the proposal in detail. I have merely acknowledged the letter.

Apart from any other consideration it appears on first sight that the proposal for a five years Moratorium, even if it were accepted by the British Government, has two very grave objections. The first is that the interest for that five years would have to be borrowed and added to capital with the result that either the period of repayment would have to be extended or the annuity increased. The more important objection is however that the difficulty of inducing a person to recommence paying his debts after five years back-sliding seems to me to be almost insurmountable and I fear that the net result would be that the last condition would be worse than the first. If we had a five year moratorium all annuities would become uncollectable during that period.⁴

The letter, of course, calls for a reply and I am asking Mr. Roddy⁵ and Mr. Hogan,⁶ who are specially interested in the matter, to consider what answer should be given.⁷ Meanwhile the documents are circulated for general information in as much as they show a line of reasoning which may be put forward by a certain group in the country.