On a point of Order. I should like to ask your ruling whether it is in order for an hon. Member below the Gangway, a new Baronet, the hon. Member for the Mansfield Division (Sir A. Markham), to speak of Members on this side of the House as "a pot-house crowd"?

I used that expression when hon. Members opposite were disgracing the House of Commons. [HON. MEMBERS: "Name."]

I must call on the hon. Member for the Mansfield Division to withdraw the word "disgraceful."

A "pot-house crowd."

I must call on the hon. Member for the Mansfield Division to withdraw the term he used. [Interruption.] May I say that, if the Committee will be good enough to support me, I do not intend to allow hon. Members on either side or in any quarter of the House to use such language, which is not for the good of the House of Commons. I call upon the hon. Member for the Mansfield Division to withdraw the term which he used.

I have never disobeyed an order of the Chair, but I regret very much, feeling as I do, the disgraceful scene, that I cannot withdraw the expression.

Under the Standing Order, I must call upon the hon. Member for the Mansfield Division to withdraw from the House for the remainder of this day's proceedings.

The hon. Baronet the Member for the Mansfield Division then withdrew.

called upon Sir F. Banbury.

On a point of Order. Mr. Chairman, earlier in the afternoon, when you had collected the voices of the House, an hon. Member opposite rose to speak and claimed to be allowed to address the House.

That point was raised and settled. Since then the House has resumed, and we have again gone into Committee, and I cannot go back upon the matter.

On a point of Order. Mr. Whitley, may I ask your ruling upon this point for the necessary guidance of the House in the future? I understand from the two rulings which you have given this afternoon that it is open to the Chairman, or presumably Mr. Speaker, to call upon an hon. Member to address the House although the Question has been once put from the Chair, but that it is not open to the Chairman to call upon an hon. Member who may rise to speak when the Question is being put for the second time. That was the only distinction between the two cases this afternoon. I understood you to draw that distinction, and I only wished to know whether I am right in so understanding?

The hon. Member is perfectly right. After two minutes have elapsed and the Question is put for the second time there can be no doubt that the opportunity is past for the House to challenge the Question.

I beg to move, in Sub-section (2), to leave out the words "thirty-first day of March, one thousand nine hundred and fourteen," in order to insert instead thereof the words "thirtieth day of June, one thousand nine hundred and thirteen." The effect of my Amendment will be—

On a point of Order. I handed in an Amendment to omit the words "the thirty-first day," and to insert instead thereof the words "the twenty-ninth." Does not my Amendment precede that of the hon. Baronet?

The Amendments deal with the same place in the Sub-section, but as the hon. Baronet had previously risen, I think I must give him precedence.

There are very excellent financial reasons why my Amendment should be carried. The intention and the effect of it will be to shorten the date to three months for which the Government can issue Treasury Bills. The Money Market, not only of London, but the Money Markets of the world at the present time are in a very tender state. The rate of interest is exceedingly high. There is a general feeling of apprehension as to what may or may not occur. There are questions in men's minds as to whether there may be peace or war, and in other matters as to what there may or may not be. Therefore it seems to me that a year is too long to give power to the Government to borrow. My experience is that it is advisable when money is dear not to borrow money for a long period. I have never heard it held that when money is dear it is a good thing to take advantage of the high rate, though the converse may be true that it is well to take advantage of the rate of money being low to borrow for a considerable period. It may be said that the Government do not intend to avail themselves to the full of the powers which are in this particular Clause, but if they ask for power to borrow money for one year they do not intend to borrow for the shorter period! The question arises, are the Government sufficiently capable of exercising a discretion in the matter? Has the right hon. Gentleman the Chancellor, of the Exchequer any such particular qualifications as would give him power to be able to judge whether it is expedient to borrow money for a short or a long time? I do not think he has. The right hon. Gentleman is as innocent as a babe unborn in these matters. Therefore I am now proposing that in the interests of the taxpayers and of the country that we should limit the period for which the Treasury Bills can be issued. As the House knows, transactions in Treasury Bills are for three or six months usually, and occasionally for a year. Three months' Bills would give the right hon. Gentleman sufficient money to go on with for the service of the country, while at the same time it would not only give control to this House of Commons in regard to finance—which I think is very necessary—but it would prevent any chance of the right hon. Gentleman entering into an improvident bargain and borrowing money at a high rate of interest and for a longer period than is necessary. This really is a financial question, and is one of considerable importance.

Perhaps the hon. Baronet will allow me to reply to what he has said. I can speak with some experience in this matter, having been Chancellor of the Exchequer. The Clause, as it appears in the Bill, is, so far as my experience goes, in the form invariably taken, and I think the hon. Baronet will agree with me. Successive Governments have adopted this form. I am not myself particularly wedded to it, but the fact that this Clause has always taken this shape, on the advice of the advisers of the Crown for the time being, is certainly prima facie evidence that it is for the convenience of the public. It must be obvious, and to no one more than the hon. Baronet himself, that if his Amendment is carried simply to confine the borrowing powers for the first three months of the financial year—that is the avowed intention and effect of it—it might most seriously cripple the Chancellor of the Exchequer in the conduct of his normal operations.

May I point out that money is very cheap at the end of June or the beginning of July, and it would be a very good opportunity to renew your Bills, if necessary, at that time. The right hon. Gentleman may say, "We have not got the power." That is quite true, but the right hon. Gentleman can come down to the House and ask for the power.

That is to say the hon. Baronet invites us to introduce a fresh Bill. But this is the course which has always been taken by every Government, and let me point out to the hon. Baronet—though nobody knows it better than he—that the revenue of the Government comes in in very unequal proportions at different parts of the year. The leanest quarter is the quarter from June to September. I say leanest, because the arrears of Income Tax for the past year come in in the quarter between March and June. We get rid of them by the 30th June. The Income Tax for the current financial year does not begin to be effectively collected till the month of January. Therefore the Government is always in want of money in the two quarters, June to September and September to December. I do not believe that this borrowing power is really so valuable to the Government during the first quarter of the year as during the second and third quarters, for the reasons I have given. If the Amendment were carried it would deprive the Treasury of the power to borrow at all after 30th June, and we would have to come and get further Parliamentary sanction. That surely, is a very unreasonable proposal!

dissented.

Yes, it is, indeed. The hon. Baronet's proposal is most unusual, unreasonable, and unbusinesslike, and nobody knows it better than he. He made the suggestion as to borrowing improvidently or in excessive amounts—

Oh, no, no. I meant at an improvident rate.

It is impossible. When we issue Treasury Bills we take the advice of the Bank of England. We have always done that. [An HON. MEMBER: "The silver question."] I am speaking of Treasury Bills. The question of silver was one which I hoped was settled and disposed of some time ago. [HON. MEMBERS: "No."] Then let us discuss it at the proper time. No one will be more glad than I to reopen it. In the issue of Treasury Bills it is our invariable practice to take the advice of the Bank of England. The Bills are advertised, and put up to tender, and the hon. Baronet knows very well they go to the highest bidder. There is absolutely no possibility of anything in the nature of abuse in regard to their issue, seeing they are issued in accordance with prescribed practice. What we are asking is absolutely necessary on account of the financial business of the country, and I hope, having given this explanation as courteously as I can, the hon. Baronet will not press his Amendment.

When the Prime Minister rose I gladly gave way, because I desired to hear exactly what the right hon. Gentleman's reply was to be to the case put forward by the hon. Baronet the Member for the City of London (Sir F. Banbury). I had intended to move an Amendment, which would almost meet every objection raised by the Prime Minister. Of course, following the hon. Baronet, who is such an expert in these matters, I am naturally at a disadvantage, but I am very glad to say that in making the more modest proposal—that is to say, limiting the payment of Treasury Bills to the 29th September, 1913, instead of the more drastic proposals of the hon. Baronet, I have gone nearer to agree with the views of the Prime Minister.

The 29th September would be a date when Parliament would not be sitting. The advantage of my date is that Parliament would be sitting, and would maintain the control of the House of Commons over Supply.

I am quite prepared to take that view. The Prime Minister, when dealing with the question of borrowing, said that the two leanest quarters of the year were always the second and third. As to the convenience, from the point of view of the House sitting, it is undoubtedly a difficulty, but I strongly feel, considering the exceptional circumstances of the present year, that it is most undesirable that this power of issuing Treasury Bills, and payment over this long period of twelve months, should be given to the Government, and that some shorter period ought to be accepted. The Prime Minister said it was in accordance with the practice of successive Governments. I do not think it is very often in the history of Parliament that a Government has found itself in the precise position in which the Government finds itself to-day, and it is certainly very exceptional that we should have such extraordinary high rates for the money, and such an extraordinarily low standard of national credit, as prevails at the present time. Therefore, I hold that the circumstances are entirely exceptional, and that what was given in normal times, that is in times when the House had control of the finance, and had control over everything, when we had legislative powers in the hands of Members of the House of Parliament, what was good for those times is certainly not good for the present time. Now we have an autocratic Government which constitutes itself the Legislature as well as the Executive, and I say we cannot leave this question of great financial borrowing power by Treasury Bills for such a large sum as £41,000,000 in the hands of the Executive for a period of twelve months. That should be curtailed, and the Government's financial wings in that respect should undoubtedly be clipped. If the hon. Baronet does not see his way to accept the more modest proposals I put forward, in suggesting that the powers should be limited to six months—and I accept the reasons he has given for not accepting it—and if I have to offer an opinion between the arguments put forward by the Prime Minister and the arguments put forward by the hon. Baronet, I am in favour of those of the hon. Baronet. I understood the Prime Minister put forward the argument that the present Government should be treated in these financial matters in precisely the same way as previous Governments have been treated; that is the sole argument that the right hon. Gentleman brings forward to justify these great borrowing powers. I support the Amendment put forward by the hon. Baronet. I say that the Government should come forward and ask us for a renewal of those powers at a time when the House is sitting. It is a little inconvenient to have two Bills of this nature and the possibility of a repetition of the debate this afternoon, but that inconvenience would be trivial compared with the alternative of handing over to the present Government this control over finance for such a period.

I want to say a few words on this question for this reason: When debating the Amendment moved by the hon. Member (Sir F. Banbury) on the first Clause of the Bill, a considerable amount of the time of the House was occupied—I am not saying wrongly or wastefully—by an hon. Member from the opposite side. He told the House that, as he was a young Member, he was anxious, for his own information, to elucidate from the Government the methods of financial procedure embodied in this Bill. I am actuated by something of the same kind in supporting the Amendment now before the House. I listened with very great care to the answer given by the Prime Minister, and it struck me that the Prime Minister made his answer so short that I think he was thinking only of my hon. Friend, and treating him as a financial expert, and he was not perhaps giving as full an explanation as he would have done if he had known the ignorance of some Members upon these matters, and their eagerness for enlightenment. I am very anxious to get some enlightenment upon the more recondite parts of national finance than appears in this Bill, and I hope the Prime Minister will condescend to address the Committee at greater length later, or, if he is not able to do that, that the Chancellor of the Exchequer will explain to ignorant people like myself what the meaning of the Clause we are now discussing is.

I confess that I was very much impressed by the argument put forward by my hon. Friend. He is, of course, a financial expert, quite equal to the Chancellor of the Exchequer, and knows quite as much about these matters. I think the right hon. Gentleman will probably admit that his knowledge of finance is not superior to that of my hon. Friend. I was impressed by his argument that the present time of the year happens to be a very bad one for laying down the rate of interest for borrowing. That, at all events, is the view taken by my hon. Friend. He says money is likely to be much cheaper later on, and the reply of the right hon. Gentleman the Prime Minister came to me, I confess, as a matter of surprise. The right hon. Gentleman said it was very inconvenient to have to take a three months' loan instead of twelve months, because the quarter from June to September was the most lean quarter of the year in the Treasury. Of course, I take the statement of the right hon. Gentleman, who himself has had experience in these matters, but I do not understand that the reason he gave for that was a very convincing one. The reason, apparently, why that quarter is a lean quarter, according to the right hon. Gentleman is because Income Tax does not become effective until January, whereas the arrears of the previous year have already been cleared off before June. But that must surely apply only to a comparatively small portion of the Income Tax. At all events it does not apply to any part of the Income Tax deducted at the source. It only applies to Schedules "D" and "A," and does not apply to the large portion of the Income Tax taken at the source; and after all, the Income Tax is not the whole of the revenue of the country. There are revenues derived from indirect taxation coming into the Treasury more or less equally throughout the year, and I should think that great injury which appears from the right hon. Gentleman's statement would occur.

The right hon. Gentleman also said that with regard to these borrowing operations, the Government always consulted the Bank of England, and therefore, that this was the time to do it, and that these were the circumstances most favourable to the Government, and that there was no fear of that embarrassing rate of interest, which my hon. Friend seems to apprehend. One of my hon. Friends, when the right hon. Gentleman was speaking, mentioned the question of silver, which was under debate in this House recently. The right hon. Gentleman brushed that aside, as having nothing to do with this matter, and said it was discussed and finished, and that even if that was not so, this was not the correct time to discuss it. So far as the merits of the silver question are concerned, of course, all are agreed with that, but I think my hon. Friend, who mentioned the word "silver" only did so by way of illustration of what might occur in other branches of the financial services of the country. I did not give very particular attention to the silver discussion in the House, but, so far as I followed it, I understand that, whereas, almost invariably in past years these operations connected with silver were conducted by the Government through the Bank of England, that for good or for bad reasons, I am not saying which, a departure was made from that practice in the past year, and that a firm of brokers were employed instead of the Bank of England. If that is so, surely it is a precedent we are entitled to keep in our minds and to guard against. The right hon. Gentleman says, so far as the borrowing of the Government is concerned, they resorted, as they always do, to the Bank of England. That may have been the invariable practice in the past, but what security have we that now a somewhat similar departure may not be made as was made in regard to the silver question? It is asking too much when a Government departs, in all the financial dealings of the country, not only public but private, from precedent, and also from the standard which has always been accepted, that when these matters come up again the whole of the House of Commons is to have the same complete trust and confidence in the procedure of the Government which they might be expected to have in other circumstances. Therefore, it does appear to me that upon this question the Prime Minister has not given by any means a convincing reply to the case of my hon. Friend, and, speaking for myself, unless some other Member of the Government can give us more convincing reason for supporting them, I shall vote for the Amendment of my hon. Friend.

I want to say one or two words in regard to the reference made by the Prime Minister in reply to an interruption of mine. In answer to my hon. Friend the Member for the City (Sir F. Banbury) he said it was purely and simply a question of finance. If we carried this Amendment we keep the whip-hand over the Government for another three months, and the Government will not be able to pay off Treasury Bills borrowed before the 30th June until they get further permission, and they will have to carry them over for another quarter. Rightly or wrongly, we have the opportunity, if we carry this Amendment, of keeping the Government in order for another three months. I admit the difficulty of keeping the Chancellor of the Exchequer in order, but I think it is much better that the House of Commons should keep what control it has over the rights of the people and the rights of the House of Commons over finance. In the past it began with the control the House exercised over the tyranny of the Crown. That was done by our control over matters of finance, and now the Crown is no longer the tyrant but the Government and the Cabinet of the day, and by this Amendment we have an opportunity of keeping control over the Government until the end of June. The Prime Minister said it would be difficult to bring in a Bill of this kind at the end of the Session and I ejaculated, "There is lots of time," and the Prime Minister said, "No, the Session would end rather early." A certain number of Bills will be crowded through, and then for six months the Government of the country is to be entirely in the hands of the present Government without any control by the House of Commons. I would not mind the House of Commons sitting for a few weeks longer if we could get more control over the proceedings of the Government. This is not an ordinary question of finance or an ordinary Government in an ordinary time, because we are dealing with the case of a Government which has suspended the Constitution. The House of Lords has no power to deal with a finance Bill, and this is the only House which can deal with finance. If this Bill is passed we lose all control over the Government until this time next year, but if we pass this Amendment which has been moved by the hon. Baronet the Member for the City of London, who is rather clever in suggesting Amendments to put the Government in a corner—if we pass this Amendment, it would put the Government in this corner, that we should have towards the end of June an opportunity of saying whether we approve of their conduct or not. The question of our opposition to this Bill is not one of detail. We are opposing this measure, not because we want to deprive the sailors or the soldiers of their pay, but because we have not confidence in the Government as a whole, or in the tyranny of the Government, or the government of the hon. and learned Member for Waterford. If we could carry this Amendment we should force the Government to come back to us again towards the end of June, and then the representatives of the people in this House would have another opportunity of saying whether they approve of the conduct of the Government or not. I think it is very desirable that we should have that opportunity as often as possible, and I strongly support the Amendment.

I should like to say a few words in support of the Amendment of the hon. Baronet. At the same time I cannot agree with what the hon. Member for St. Augustine's (Mr. Ronald M'Neill) said in regard to the purchase of silver, as to which I think the India Office made an arrangement quite satisfactory to India, although there may have been some indiscretion in the manner of carrying out that intention. In regard to the gold standard in India, I sincerely hope the Government are not going to be led away or take any other steps affecting the export of gold from this country, which already has too small a gold reserve, because, if that is done, I think our commercial activities would be seriously prejudiced by taking the steps suggested. My intention is to support the hon. Baronet, because, in point of fact, I am one of his constituents in the City. The hon. Baronet is an extremely good authority upon the commercial aspect of all these questions, and when he addresses himself to a financial subject he knows what he is talking about. That is why he is listened to with so much attention, not only in the House of Commons, but in the City of London, which he so well represents. This Amendment proposes to shorten the time by altering the date to three months, and I strongly support that proposal. I will give the reason which weighs most strongly with me in adopting that course. It is that the Chancellor of the Exchequer is profoundly distrusted in the City as a financier. I am speaking of the method by which he deals with the finances of the country, and I have no intention whatever of saying anything offensive. Whereas the right hon. Gentleman's predecessor, the Prime Minister, was a most prudent guardian of the public purse and adhered strictly to precedent, and was most careful not to be the originator of sensational measures or the spender or waster of our national resources—

We cannot have a review of the conduct of the Government during a Committee stage of a Bill of this kind. This Debate has already gone to a length which on no other occasion has been permitted, and we can only deal now with the technical question raised in the Amendment.

May I ask whether my personal references to the methods of the Chancellor of the Exchequer are not strictly relevant to the Amendment, because I argue that that is one of the greatest factors and reasons for accepting the hon. Baronet's Amendment. The right hon. Gentleman's methods, be they good or bad, are absolutely at variance with the methods of all his predecessors, and instead of being the custodian of the public purse, he is, in point of fact, the chief spender, and, therefore, he is in a different position—

The hon. Member will be quite entitled to say that at the proper time which will arise on the Second or Third Reading, but it is not in order in Committee.

I spoke with perfect respect to the right hon. Gentleman, and I may observe that although the proper occasion is as indicated by you, Mr. Chairman, it is by no means certain that any hon. Member on this side will be able to take the opportunity which you have indicated. Should I be in order in pointing out that it is a factor in considering the propriety of giving the Government a longer period over which to borrow, and deciding whether or not the House should part with its power of review, to point out that the charges upon the Consolidated Fund resulting immediately from the legislation of the custodian of finance are almost equal to those of the Army, and will shortly be as great a charge as that for one of the greatest branches of expenditure in this country. I presume that is not in order, but I wish to know if I shall be in order in pointing out that it is an entirely novel procedure, and it has never happened before, that the Government should endeavour to rush a Vote for £1,800,000 through the House of Commons—

That is quite out of order, and the hon. Member must not pursue that matter at all. I have already told the hon. Member that only the question of the date is in order.

When I have been advancing what I considered good and relevant arguments, I have immediately dropped them when you have ruled them out of order, and I am sure that that is conduct which will meet with your approval. I had no intention whatever of indulging in a carnival of irrelevancy. I will, however, advance this argument, that it is exceedingly desirable that the power of the House over the public purse under existing circumstances should be more rigidly guarded than ever it has been before in the history of this country. Never has there been so much extravagance before. I will take an illustration. When the East India Company governed India they were bound when they required a renewal of their Charter to come to this House and submit—

I must now ask the hon. Member to resume his seat.

I should like to support the Amendment which has been moved by the hon. Baronet on two grounds: firstly, financial; and, secondly, constitutional grounds. I think the constitutional grounds have been ably set out by the hon. Member for Brentford (Mr. Joynson-Hicks), who pointed out that it is desirable that this House should have as much control as possible over the financial operations of the Government, and it is very desirable that the Government should be compelled to come to this House in June to get fresh borrowing powders if they are necessary. Then the House would be able to supervise adequately the financial methods of the Government. If this restriction, altering the period from twelve months to a shorter period were carried, I think it would be the means of saving a considerable amount of the taxpayers' money. Last year there was almost a financial scandal owing to the height of the Exchequer balances. They were very much too high, and there was a great deal of unnecessary money on those balances not earning interest, and at the same time there was a very large amount of Treasury Bills being issued. It seems to me that there are times in the year when Treasury Bills are not wanted, when the Government have sufficient money to carry on, and therefore it is a sheer waste of public money that Treasury Bills should be running during that period when, at the same time, the Exchequer balances are lying idle. I can see no reason why this Amendment should be objected to except that given by the Prime Minister, that it would necessitate taking more Parliamentary time, because the Government would have to come down and get Parliament's assent to the issue of fresh Bills. It might waste some of the Government's time, but I do not think it would in any way endanger the financial management of this country, because, if the Government could show there were solid grounds why they wanted a fresh issue of Treasury Bills, I am sure this House would willingly accede to their request. It would, if this Amendment were accepted, strengthen the control that this House ought to have over finance, which to a great extent it is losing, and I seriously think it would be the means of saving considerable money to the already overburdened taxpayers of this country.

rose in his place, and claimed to move, "That the Question be now put."

claimed "That the Question 'That the Clause stand part of the Bill' be now put."