laid upon the Table Report from one of the Examiners of Petitions for Private Bills, That, in the case of the following Bills, referred on the First Reading thereof, Standing Order No. 62 has been complied with, namely:—

• Latimer Road and Acton Railway Bill.
• Midland Railway Bill.
• Rickmansworth and Uxbridge Valley Water Bill.
• Wolverhampton Gas Bill.

laid upon the Table Report from one of the Examiners of Petitions for Private Bills, That, in the case of the following Bill, referred on the First Reading thereof, Standing Order No. 67 has been complied with, namely:—

I beg to ask the First Lord of the Treasury whether the Transvaal Republic became subsequently an acceding party to the Declaration signed at St. Petersburg on 11th December, 1868, between Great Britain, Austria, Bavaria, Belgium, Denmark, France, Greece, Italy, Netherlands, Persia, Portugal, Prussia and the North German Confederation, Russia, Sweden and Norway, Switzerland, Turkey, and Würtemberg, by which the contracting parties engaged to renounce in case of war among themselves the employment by their troops of explosive bullets; and, if not, whether, considering Great Britain has adhered to the above engagement, and that such Declaration is by its terms not binding in a war with a non-acceding Power, any protest can be made by the other signatories of the Declaration against the employment of explosive bullets by the Boers as officially reported.

I have to say, in answer to my hon. friend, that Her Majesty's Government are not aware of the Transvaal Government having acceded to the Declaration of St. Petersburg, signed in 1868, on the subject of the use of explosive bullets in war. The Declaration does not provide for any protest on the part of the signatory Powers in the event referred to by my hon. friend.

I beg to ask the Secretary of State for the Colonies, having regard to the recent proclamation by the Government to the effect that any attempted dealings with property in the Transvaal for non-payment of war tax or otherwise to the prejudice of British subjects would not be recognised by our Government so far as regards such impositions made since the outbreak of the present hostilities, whether this proclamation or its principle would apply to any action taken by the Transvaal Government in respect of the non-payment of the war tax which was imposed on landowners prior to the outbreak of hostilities, but not paid by them in consequence of the Colonial Office having given the opinion in writing on 20th May last, that it was a breach of the London Convention of 1884; and whether British owners of land in the Transvaal, who have paid the war taxes under protest and under threats of forfeiture of such lands by the Transvaal Government, will have their rights to recover back such war taxes saved.

I have received no representations that farms have been confiscated for non-payment of war tax prior to the outbreak of the war. Any confiscation subsequent to October 10th is covered by the notice of 26th January. Her Majesty's Government were advised subsequent to the outbreak of the war that in view of the arguments put forward on behalf of the South African Republic their protest could not be maintained on the grounds originally taken, and they cannot therefore pledge themselves in the matter.

I beg to ask the Under Secretary of State for War if he can state the number of appointments to first commissions in the Army made during the past six months, and how many of these were promotions from the ranks.

The total number of appointments to first commissions is 835, and of promotions from the ranks is eighty-four.

I beg to ask the Under Secretary of State for War what is the amount of the reduced force to be maintained in South Africa after the 30th September for which provision is made in the Estimates.

The Estimates were framed on the basis of making full provision for the war charges up to the 30th September, and half provision for the remainder of the year; and not upon a calculation of the precise number of men likely to be present in South Africa after the 30th September.

I beg to ask the Under Secretary of State for War whether he can say if Private Francis Martin, No. 5108, Royal Irish Fusiliers, was amongst the number taken prisoners at Nicholson's Nek; and, if so, whether he can say where he is now; and when it is intended to publish the list of those taken prisoners in that battle.

A list of the Royal Irish Fusiliers who were missing after Nicholson's Nek will be called for, now that Ladysmith has been relieved; and the hon. Member will be communicated with.

I beg to ask the Under Secretary of State for War whether he has any objection to give the names of the hon. Members of this House who are alleged to be at the front, the regiments to which they are attached, and the capacities in which they are serving; and whether any of those hon. Members have been engaged in actual fighting; were any of them wounded or taken prisoners; and, if so, when or where were they in battle.

A Return is now being prepared in the terms of the address moved by my hon. friend the Member for the Stratford-on-Avon Division of Warwickshire, which will give the hon. Member most of the information for which he asks. It will not be feasible to include the details referred to in the second paragraph of the question, but the hon. Member may rest assured that wherever the hon. Members referred to are serving, they are doing their duty.

Will the Return apply to the two hon. Members for Sheffield, who are missing, and whose whereabouts are unknown?

I beg to ask the Under Secretary of State for War if he can state whether, at the beginning of the South African War, several ships containing large numbers of horses were sent out without a veterinary surgeon on board; and what was the result of this course; and whether any steps have been taken to provide each horse transport ship with a veterinary surgeon.

Eleven ships containing horses were despatched before the 16th November, without veterinary surgeons; the numbers of horses on board were not large and a specially selected farrier quartermaster-sergeant or sergeant farrier was sent on each vessel. The percentage of deaths on board, excluding the "Ismore," which sank, was 4·54. Since the 16th November a veterinary surgeon has been placed on each horse transport leaving the United Kingdom with regular units or remounts.

I beg to ask the Under Secretary of State for War why has a large proportion of the liabilities for sea transport incurred during the present financial year, as stated at page 6 of the Secretary of State's Memorandum, been placed on the Estimates of next year, instead of being inserted under that head in the recent Supplementary Army Estimate.

Payments for sea transport are made partly in advance as the ships are taken up, and partly in arrear. The Supplementary Estimate covers so much of the liabilities as we expect to discharge during the current financial year.

I beg to ask the Under Secretary of State for War whether it has been brought to his notice that some of the field artillery guns at the front in South Africa have recently been found defective from corrosion caused by the use of cordite; and whether any steps are being taken to rapidly replace these guns.

Spare guns have been sent out to replace any which may be found defective. It is not the case that cordite has a "corrosive" effect, although the constant use of the gun, whether with cordite or any other explosives, will in time wear out the tube.

Does not cordite cause erosion of the barrel of the gun?

I was asked if it had any corrosive effect, and my answer was "No."

I beg to ask the Under Secretary of State for War whether the muzzle velocity of the Lee-Metford rifle is inferior to all rifles in the hands of European Powers; that the alleged irregular qualities of the cordite powder, the way in which the Lee-Metfords are sighted, and the complicated reloading, have been repeatedly evidenced in the course of the present war; whether the English rifle and ammunition are each heavier than the United States Navy, the German Mauser, and the Männlicher weapons and whether, as stated, it has the worst trajectory, the least penetration, the slowest fire once the magazine is emptied the weakest breech bolt, least rigid woodwork, the worst trigger-pull, and worst sights compared with the above-mentioned rifles; and if it is the most expensive of any service weapon.

The replies to paragraphs 1 and 3 of the question are in the negative. In regard to the second paragraph our rifle is heavier than some and lighter than other magazine rifles; there are many patterns of Männlichers and Mausers. Our ammunition is rather lighter than the average ammunition of other nations.

I beg to ask the Under Secretary of State for War whether he has received any complaints as to the inferior quality of the uniform supplied to the Yeomanry; whether the reason given by the contractor was that the price was cut too low, and what is the name of the contracting firm.

I am informed by the Yeomanry Committee that there has been little or no complaint as to the khaki and as to the greatcoats. There have been complaints as to the Bedford or velveteen cord. No contracts were made for these supplies. The firms employed by the Yeomanry Committee stated that it was virtually impossible to obtain the required quantities of the best material within the time specified. The difficulty seems to have been one of time rather than of price.

I beg to ask the Under Secretary of State for War whether he is aware that Volunteer service companies, for whom there was no room in barracks during their period of training, were put to heavy expense to secure suitable lodgings; and whether he sees his way to put them on the same footing financially as those who had barrack accommodation provided for them.

As Volunteer service companies are treated in the same way as Regular soldiers, no more than ordinary rates have been sanctioned. The Secretary of State for War is, however, prepared to consider any special cases in which it can be shown that the Volunteer corps have been put to expense.

I beg to ask the Under secretary of State for War if he will state the number of Volunteers who have submitted themselves to medical examination prior to service in South Africa, the number rejected on account of bad teeth, and the number rejected for other reasons.

No Returns on this matter are available.

I beg to ask the Under Secretary of State for War whether it has been brought to his notice that the mounted company of the Bedford Regiment, 100 strong, were upon arrival in South Africa supplied with only fifteen horses, which horses were afterwards taken from them, and they were consequently obliged to march to the front in their riding kit; and what steps, if any, have since been taken to mount these men.

The Secretary of State for War has no knowledge of the matter referred to. I may, however, explain that the clothing of mounted infantry has been designed so as to admit of the men being used as foot soldiers.

I beg to ask the Under Secretary of State for War whether he is aware that soldiers who marry without leave, when they fulfil the requirements of having £5 in the savings bank, seven years service, and two good conduct badges, which qualify to be placed on the marriage roll, cannot be put on it without the sanction of the general officer commanding, and provided there is a vacancy, and no qualified applicant for leave to marry exists; whether, in view of the exceptional trial the war has cast upon the wives of soldiers, he will inquire whether there are any who, having married without leave, now fulfil those requirements, and yet have not been able to be put on the roll owing to want of vacancies; and whether he can see his way to relax these conditions as regards the deposit in the savings bank, the length of service, and number of good conduct badges, so as to extend separation allowances to many deserving wives of soldiers now debarred by this regulation.

I beg at the same time to ask the Under Secretary of State for War whether, in view of the distress which has been caused by the war to the wives and families of many soldiers married without leave, the Government will make an exception in favour of men married without leave who are on active service, and grant their wives separation allowances during the time their husbands are serving at the front.

This question is engaging the attention of the Secretary of State, whose decision will not long be delayed. Meanwhile it is not likely that any deserving wives of the soldiers referred to will fail to obtain assistance from one or other of the funds existing for the purpose.

I beg to ask the Under Secretary of State for War what is the weekly cost of housing and maintaining the families of officers and of soldiers married with and without leave; and what proof is required by the War Office from officers or soldiers of the sufficiency of their private means to maintain a family.

It is not possible to state with accuracy the cost referred to in the first paragraph of the question. No proof is required of sufficiency of private means in the case of officers or of non-commissioned officers including the rank of sergeant. In the case of ranks below that of sergeant, men admitted to the married establishment are required to show that they have to their credit a sum of £5 in the savings bank.

I beg to ask the Under Secretary of State for War whether, with a view to procure serviceable horses for the Army, he will suggest to the War Office the desirability of employing local agents to purchase remounts in the south of Ireland.

No, Sir. It is not considered expedient; the staff of the Remount Department is ample for the purpose.

Can the hon. Gentleman say why the practice followed in the north of Ireland cannot be adopted in the south of Ireland—I mean the practice of employing local agents to purchase horses?

I always understood there was a great deal of difference between the north and south of Ireland.

I beg to ask the Under Secretary of State for War whether, when the present Commander-in-Chief was Adjutant General at the War Office in 1887, he advised, recommended, or approved of the reduction of the Royal Horse Artillery in that year.

Lord Wolseley was Adjutant General in 1887, but I cannot admit the right of the hon. Member to demand information as to the advice tendered at that, or at any other time, by the members of the Headquarters Staff. The Secretary of State for the time being was responsible for the action taken.

Are we to understand that the War Office objects to tracing home any personal responsibility?

Order, order! The hon. and gallant Member is now arguing the question.

I beg to ask the Under Secretary of State for War whether his attention has been directed to the new French quick-firing field gun, with hydro-pneumatic brake and spade trail; whether it is contended that twenty rounds per minute have been fired, with shrapnel and common shell; and if the gun is protected by a steel shield.

I do not think it would be desirable to make public the information received by the War Office upon such matters as this, but the hon. Member may rest assured that the attention of the Secretary of State for War is directed to all reported improvements in the artillery of other countries.

I beg to ask the Under Secretary of State for War whether the practice of making a 5½-in. howitzer for use in India and a 5-in. howitzer for use in the United Kingdom and the colonies is still persisted in; whether the military advisers of the War Office have sanctioned the use in two branches of Her Majesty's land service of two weapons differing in calibre by half an inch only, but the ammunition of which is not interchangeable; whether the War Office sanctioned the adoption of a different type of gun for Indian service; and whether there is any Minister of the Crown, officer, Committee, or other authority which has power to insist upon uniformity when the War Office and the India Office cannot agree.

The British 5-in. howitzer and the Indian 5·4-in. howitzer are weapons intended for different purposes, the former being primarily a mobile field howitzer drawn by horses, and throwing a 50-lb. shell, the latter a siege howitzer drawn by oxen and throwing a 60-lb. shell. As the latter weapon is designed to meet special Indian requirements, the War Office sees no occasion to press the objections which might have been raised to the adoption of two different patterns of howitzer. In the event of disagreement between the War Office and India Office the point in dispute would be referred to the Defence Committee of the Cabinet.

As a matter of fact, was there a disagreement at the time these guns were sanctioned between the India Office and the War Office?

I do not know that to be a fact, Sir.

I beg to ask the Under Secretary of State for War whether measures will be taken to further improve the rifle shooting of the Regular and Auxiliary infantry of the Army; whether the present system of training in drill and of military duties will be altered to enable the soldier to have more constant practice in combined rifle shooting and judging distance under as nearly as possible service conditions; and whether a military committee will be appointed to report on this subject.

These questions are under consideration, but I am not at present in a position to make a statement with regard to them.

I beg to ask the Under Secretary of State for War if his attention has been directed to the fact that while county councils have power to purchase land for rifle ranges they cannot hire land or spend their funds on erecting butts or screens or otherwise making ranges safe for shooting; and if he will consider the desirability of extending the provisions of the Military Lands Act so as to enable the local authorities to assist the Volunteer corps to procure ranges more effectually than they can do at present.

A clause giving permission to county councils to erect butts or screens for the benefit of volunteer corps was originally contained in the Military Lands Bill, 1892, when introduced, but was opposed on the Second Reading and in Committee, and was dropped. The Secretary of State is considering whether further legislation in this direction would be expedient.

I beg to ask the Under Secretary of State for War whether it is the intention of the War Office to insist on the retirement of all Volunteer commanding officers appointed prior to 1896 during the present year, in accordance with the Order issued during 1896; and in the event of this order being relaxed, will they specially omit from any relaxation all officers who were in any way concerned with the buying and selling of honorary colonelcies, which occurred some three years ago.

From the 1st November, 1896, all Volunteer commands were limited to four years, but general officers commanding districts have the power of recommending extensions which may not exceed four years. Such cases are very carefully investigated, and no entension is granted unless the officer is considered worthy of it.

I beg to ask the First Lord of the Admiralty whether he will state which of the older ships besides the "Warrior," the "Boadicea," the "Belle Isle," and the "Black Prince" are to be at once struck off the list.

I have no further statement to make on this matter at present.

I beg to ask the First Lord of the Admiralty whether, having regard to the admitted inability of his Department to complete the authorised expenditure for the year for shipbuilding, and having regard to the fact that many shipbuilding firms of high standing are without any orders at the present time, he would consider the expediency of giving some of those firms an opportunity of carrying out a portion of the authorised work, in view of the fact of the efforts which foreign Powers are making at the present time to increase their naval strength.

Certainly they will have an opportunity. There are only two or three large shipbuilding firms capable of constructing battleships or armoured cruisers, which are without Admiralty orders at the present time; all the others have large orders. These firms will have the same opportunity as others to carry out a portion of the authorised work, and I shall be very glad if they will avail themselves of it.

I beg to ask the Secretary of State for the Colonies whether he has received protests from the Canadian and New Zealand Governments against the concessions recently granted to the Eastern Extension Company in Australia as being likely to militate seriously against the financial success of the Pacific Cable in which the Imperial, the Canadian, and the Australasian Governments are joint partners; whether, in view of these protests, it would still be possible to revoke the concessions and prevent any further complications of a like character; and whether he has received a reply to his message to the Australian Governments on the subject.

I have received protests of the nature described, from Canada and New Zealand. I am informed by the Government of New South Wales that no arrangement has yet been concluded with the Eastern Extension Company, though it is aware that the decision of the recent conference of Premiers was generally favourable to the proposals of the company.

I beg to ask the Under Secretary of State for Foreign Affairs what progress has been made in China towards the full opening to trade of the West River, and of rivers generally.

It is impossible within the limits of an answer to a question to give a complete account of the position; but the reports from Her Majesty's Consuls included in the Papers now being prepared for Parliament contain full information on the subject. According to the latest information, trade is steadily increasing on the West River.

May I ask the right hon. Gentleman if it is not the fact that Nanning-fu, which was declared to be open as a treaty port in February last year, still remains unopened; and whether the Government have taken any steps to secure the immediate opening of the port?

I must ask for notice.

I beg to ask the Under Secretary of State for Foreign Affairs whether Her Majesty's Government have given attention to the statements to the effect that the Russian Government has already commenced the construction in Persia of the Zulfa-Tabriz-Hamadan line of railway, with a branch to Teheran, and which is to terminate at Bunder Abbas at the mouth of the Persian Gulf, and that several officers of the general staff have been instructed to watch over the works, having under their orders several regiments of Cossacks; whether Her Majesty's Government are informed that Persia will grant to Russia the port of Bunder Abbas on the same terms as those under which Port Arthur has been leased to Russia by China, and that it is the intention of Russia to construct a military port and a dockyard, fortified or otherwise, at Bunder Abbas; and whether Her Majesty's Government have made, or propose to make, any representations on this subject to the Government of Russia or of Persia.

Her Majesty's Government have received no information tending to confirm these statements, and have no grounds for making representations to the Russian Government in regard to them.

I beg to ask the Under Secretary of State for Foreign Affairs whether the Amir of Bokhara has ceded to Russia free of cost extensive tracts of land in the upper courses of the Oxus, to be used for farming settlements for colonists from European Russia, and has also given permission to Russia to construct military stations for its Central Asian troops, and the right to establish fortified stations on the frontier of Afghanistan.

Her Majesty's Government have received no information to this effect, but it is within this competence of the Amir of Bokhara to make such arrangements as he may deem fit on these points.

Is the Government destitute of all information whatever?

I beg to ask the Under Secretary of State for War whether it is intended that the two Native Indian regiments provided for the garrison of Mauritius are to form part of the permanent regimental establishment to be borne on the Army Estimates.

It is impossible to say at present whether the arrangement will prove to be a permanent or only a temporary one.

I beg to ask the Under Secretary of State for Foreign Affairs, with reference to his statement on the 22nd ultimo^* that the British Central African natives lately stationed in Mauritius were returning to Africa, whether they have by this time reached their own country; and, if not, whether they are still on board ship.

They are still on board ship.

Where are they going to?

I must ask for notice.

I beg to ask the Secretary of

^*See The Parliamentary Debates [Fourth Series], Vol. lxxix., p. 900.

State for India whether he has come to any decision in regard to the claim of the Church of Scotland that Presbyterian soldiers in India shall share in the use of churches built at the public cost for Protestants, and that such use shall be regulated by some other authority than the Bishops of the Church of England.

I have been in communication with the Government of India on the subject referred to in my right hon. friend's question, and propose to present papers to Parliament as soon as my despatch has reached the Viceroy.

I beg to ask the Secretary of State for the Home Department whether county councils can combine for the management as well as the establishment of certified inebriate reformatories, and whether joint committees of such councils can be formed for the purpose of management; and if he proposes to make any regulations for boards of management.

The power conferred on county councils by Section 9, Sub-section (1) of the Inebriates Act, 1898, to combine for the establishment or maintenance of a certified reformatory seems to me to include management, and I think this would be a matter of common interest in respect of which county councils might appoint joint committees under Section 81 of the Local Government Act, 1888. The regulations which I have made prescribing the duties of managers would apply to boards of management, though in special circumstances they might need to be modified. I shall be ready to consider carefully any proposal for joint action by county councils, which is a thing to be encouraged.

I beg to ask the Secretary of State for the Home Department whether he is aware that annoyance is caused to omnibus passengers in London through ticket examiners mounting omnibuses and demanding to see the travellers' tickets; and whether these examiners are legally entitled to enforce their demand; and, if not, would he see his say to issue regulations to put a stop to this practice.

The police have only received since 1892 four complaints of the practice referred to, which whether or not it could be legally enforced does not appear to me to be an unreasonable one when exercised in a proper manner. In any case I have no power to interfere with it.

I beg to ask the Lord Advocate whether any applications have been made under Section 1 of the Private Legislation Procedure (Scotland) Act, 1899; what is their number and nature; whether the Chairmen of Committees of the two Houses have had occasion to take action under Section 2 of the same Act; and whether any action has been taken under Sections 4 and 5 as to the formation of extra Parliamentary or Parliamentary Panels; and in that case will he furnish the House with the names of such Commissioners.

The hon. Member is under a misapprehension. The Act does not come into effect for the purposes mentioned by the hon. Member until the end of the present session of Parliament, and no action in the matters dealt with in the question can be taken until then.

I beg to ask the Lord Advocate whether the Secretary for Scotland has received from ratepayers resident in the borough of Cowdenbeath, Fifeshire, complaints of irregularities in connection with the recent election of the Cowdenbeath Burgh Commissioners, and will he say what action he proposes to take in the matter.

A complaint alleging the commission of irregularities at the burgh elections at Cowdenbeath in 1899 was received by the Secretary for Scotland. The complainers were informed that the Secretary for Scotland had no jurisdiction, and that their remedy was by petition to the court. It would be impossible to do away with irregularities by special legislation, nor do those alleged seem to call for it. It is not proposed to take any further action in the matter.

I beg to ask the Secretary to the Treasury, as representing the Postmaster General, whether he is aware of the delays which have occurred in the transmission of telegrams from Russia, Scandinavia, and Northern Europe generally, viâ Newcastle, during the last fortnight, as a result of which telegrams by this route have reached London mainly after business hours, a delay which has been the cause of loss and dislocation of business by this route, and what is the cause of this delay, and when it is expected the service will return to its normal condition.

These delays were caused by the breakdown of the telegraph lines by the recent snowstorm, which was of an extremely severe character, and the effects of which were most seriously felt in the north-east of England and in Scotland. During the interruption of the ordinary routes telegrams for the north of Europe were, as far as practicable, transmitted viâGermany, the delay varying from twenty minutes to about two hours. The normal condition of the service has now been restored.

I beg to ask the Secretary to the Treasury, as representing the Postmaster General, whether Mr. D. W. Jones, a telegraph clerk with twenty years service, stationed at the Chief Office, London, has been threatened with superannuation, the reason assigned by the official medical officer being five single day absences last year; whether he is aware that Dr. Farrar, of Putney, certified that Jones was suffering from nervous disorder, and that a complete change of air was necessary; and will he explain why the official doctor disregarded the certificate and ignored the recommendation of Dr. Farrar, although making no examination of the patient; and whether the Postmaster General will investigate the case with a view of securing more lenient treatment to men of long and good records.

There has been no question of superannuating Jones. When Jones forwarded Dr. Farrar's certificate of the 23rd January, recommending a week's leave, he was allowed sick leave for the whole period so recommended. He stated that he did not see his way clear to act on the advice given by Dr. Farrar that he should take a change of air, but asked permission to do so later on when convenient to himself. He was instructed to see the medical officer of the Department before going away. He resumed duty, however, on February 1st.

I beg to ask the Secretary to the Treasury, as representing the Postmaster-General, whether he is aware that there has been no telephonic communication between Dundee, Montrose, and Aberdeen for the last fortnight; whether this is consequent on the telephone wire being used for telegraph messages; whether contractors for the use of the telephone will be compensated for their loss of service; and when the telephonic communication in this district will be renewed.

On three days, the 16th, 17th, and 18th February, a section, between Montrose and Aberdeen, of the trunk telephone line from Dundee to Aberdeen was used in making up telegraph circuits from Aberdeen to Edinburgh and Dundee. The telephone line was at the time broken down south of Montrose; and if the uninjured section had not been used in the manner described, Aberdeen would have been entirely cut off from telegraphic communication with the south. There are no contracts or agreements to which the Postmaster General is a party for the general use of the trunk wire system. The acceptance of each message is a separate transaction as in the case of an ordinary postal telegram, and no person is entitled to compensation on account of an interruption of the service. The restoration of the Dundee-Aberdeen trunk line was completed and the line brought into use on the 2nd instant.

I beg to ask the Secretary to the Treasury, as representing the Postmaster General, whether he is aware that telegrams arriving at the House of Commons directed to Members after 7.30 p.m. on Wednesdays are returned to the West Strand Office; that such telegrams are thus delayed in delivery about fourteen hours; and whether he could arrange that such telegrams, at least during the present anxiety for news from the front, should be accepted and redirected to Members' private addresses without delay.

After 7.30 p.m. on Wednesdays, telegrams in respect of which no special instructions have been given by Members to the Postmaster of the House of Commons are not sent to the House of Commons at all, but are dealt with at the West Strand Office, where measures are taken to have them posted to the private addresses of Members. Unfortunately these measures have sometimes failed to get the telegrams included in the first morning delivery, but the Postmaster General has now given instructions which will secure their inclusion in this delivery in future.

I beg to ask the President of the Board of Agriculture, whether any and what steps have been taken by the Board of Agriculture, in exercise of the power conferred by Section 4 of the Sale of Food and Drugs Act, 1899, upon the Board, to set up presumptive standards of quality in respect of milk, cream, butter, and cheese.

No regulations under the section referred to have as yet been made, but I have appointed a Departmental Committee, of which Lord Wenlock is the Chairman, to consider whether any such regulations can with advantage be made in respect of milk and cream, and upon the report of the Committee the further action to be taken will to a great extent depend.

I beg to ask the President of the Board of Agriculture whether he is now prepared to frame regulations for the purpose of meeting the case of small farmers and others who may require, as a matter of urgency, to send a cow to a neighbouring farm and back for stock purposes.

By an order which comes into operation to-day facilities for the movement of stock for breeding purposes will be afforded in certain portions of the scheduled district, which will, I think, meet the case to which the hon. Member refers.

I beg to ask the Vice-President of the Committee of Council on Education whether he can see his way to renew the instruction to Her Majesty's inspectors requiring records to be kept in the logbooks of elementary schools of all cases of the infliction of corporal punishment, which instruction was, as stated by him, withdrawn in 1891 without reason assigned or representations made; and whether he is aware that infants of three and four years of age have been caned in elementary schools.

Before the right hon. Gentleman answers may I ask a question of which I have given him private notice—namely, whether in the opinion of the Education Department many objectionable forms of punishment which were encouraged by the rule in question have not been abandoned since the rule was withdrawn?

The statement made by me was that no record of the reasons and representations now exists, not that no reasons were ever assigned and no representations ever made. But the suggestion of the hon. Member shall receive careful consideration when the instructions to inspectors are issued, as they will be shortly. Canes are, I regret to say, used in some infant schools. In regard to the supplemental question, I cannot say that the Committee of Council are of opinion that any such beneficial results have followed from the dropping of the regulation.

I beg to ask the Vice-President of the Committee of Council on Education whether he can state if the parish almanack containing announcements that confessions were received every Sunday evening, asserting the doctrine of the Apostolic Succession of the clergy of the Church of England, advocating prayers for the dead, and deprecating the use of the word Protestant as applied to the Church of England, still continues to be affixed to the wall inside of the board school of Church Coppenhall, Crewe; and whether certain board schools have been threatened with withdrawal of the grant if they used the Church Catechism; and if so, whether it is consistent with the rules of the Education Department for such an almanack to be openly displayed in the Church Coppenhall Board School.

I have been informed by the rector of the parish that (1) the almanack was never put up on school board premises; (2) it was put up for Sunday use only in premises leased to the board on five days in the week; (3) the rector publicly stated some days ago that as chairman of the board he had ordered its removal during day school hours. I can add nothing to the statement I have already made that the Committee of Council does not appear to have any jurisdiction over the almanack.

I beg to ask the Vice-President of the Committee of Council on Education whether it is proposed that the National Union of Teachers should be represented on the Consultative Committee about to be formed under Section 4 of the Education Act of 1899; and, if so, whether there will also be provided adequate representation for the National Society and the Associations of Voluntary Schools.

It is not intended that either the National Union of Teachers or any other outside association shall be expressly represented upon the Consultative Committee.

I beg to ask Mr. Attorney General whether his attention has been called to certain incitements to riot and breach of the peace; and whether he will call the attention of the Public Prosecutor to the matter.

My attention has not been called to any incitement to riot or breach of the peace, but the hon. Baronet has been good enough to send me an extract from the Sun newspaper. In my opinion the paragraph does not fall within that description, and certainly there was nothing that would justify my directing any action on the part of the Public Prosecutor.

I beg to ask the President of the Board of Trade, whether he will cause inquiry to be made as to the inconvenience caused to the public at large, particularly the people of Sligo and neighbouring towns, by the irregularities as to the trains belonging to the Midland Great Western, the Sligo, Leitrim, and Northern, and Waterford, Limerick, and Western Companies, those trains being often from ten to sixty minutes late on arrival at Sligo terminus.

I can only direct the attention of these railway companies to the complaint of inconvenience contained in the hon. Member's question, and this has been done.

I beg to ask the Secretary to the Treasury, with reference to a letter addressed by the Irish Board of Works to the Limerick Harbour Board, warning that body not to incur any expense in connection with the opposition to the Great Southern and Western Railway Companies Amalgamation Bill now before Parliament without the consent of the Board of Works, whether he is aware that the promoters of the Amalgamation Bill have been circu- lating a report that the Board of Works is in favour of their Bill; whether he is aware that the Limerick Corporation, Limerick Harbour Board, and all other representative bodies in Limerick City, are representing the wishes of the citizens in opposing the proposed amalgamation; whether he is aware that the Limerick Harbour Board is a solvent body fully able to meet its liabilities; and whether he will see that no further action is taken in this matter by the Board of Works which might interfere in any way with the right of the Limerick Harbour Board to influence Parliament in opposition to a Bill now awaiting its consideration.

I have no knowledge of any reports circulated by the promoters of the Amalgamation Bill, but the action of the Board of Works with regard to it has been confined to protecting its own interests, firstly as mortgagee, and secondly as the protector of certain State aided railways. I do not know whether all representative bodies are joining in this opposition, or how far their action either way represents the wishes of the citizens. The solvency of the Harbour Board is not questioned. The Board of Works have a considerable interest in the expenditure of the Harbour Board, because all its surplus revenue is applied to reducing the principal of one of their loans, and accordingly I do not propose to interfere with their action.

May I ask the right hon. Gentleman if he is aware that only last session the Chief Secretary for Ireland met a deputation of all the representative bodies, who stated their views to him? And with regard to the question of solvency, is it not the fact that this Harbour Board has not only paid up all the instalments of interest due but has reduced its capital debt by £36,000? And if that be so, what is the special reason which called for this warning this year and not last?

One reason is that they spent so much money last year that they cannot afford it this year.

I rise—

Order, order! The hon. Member must not persist in arguing.

I shall refer to the question again.

I beg to ask the Secretary to the Treasury, as representing the Postmaster General, whether steps will be taken by the postal authorities to provide telephonic communication between Macroom, Coachford, Crookstown, and Cork; and, if so, how soon will it be in working order, and by what route will it be laid.

There are no local telephone exchanges at Macroom, Coachford, and Crookstown, and no application has been made for trunk wire extensions. The very small amount of business which could be expected would not justify the Postmaster General in providing telephone trunk wire communication with these places expect under guarantee. There are already public telegraph offices in all three places.

I beg to ask the Chief Secretary to the Lord Lieutenant of Ireland whether his attention has been called to a meeting of the United Irish League, held in Bantry on Sunday the 18th February, when, in the course of his speech, Mr. William O'Brien stated that alien landlordism has left the marks of its bloodstained fingers on the necks of an oppressed and suffering people, and that he advocated the destruction of landlordism and the ending of the rent office, and asked what had been gained by patience and quietness; whether he is aware that, on the Saturday of the same week, Mr. William Bird, J.P., a landowner and rent agent, was murdered in his office at Bantry; and whether it is the intention of the Government to take any action with respect to meetings of the United Irish League.

Before the right hon. Gentleman answers, may I ask whether he is aware that many of the Unionist Members are pledged to the abolition of landlordism on the terms advocated by Mr. William O'Brien—namely, by compulsory purchase—

Order, order! That does not arise out of the question on the Paper.

My attention has been called to the meeting referred to. According to the report published in the Freeman's Journal newspaper, dated February 19th, Mr. William O'Brien appears to have used language substantially to the purport and effect mentioned. The answer to the second paragraph is in the affirmative. A man has been arrested charged with the commission of the crime, and the investigation into his case is now proceeding. Under these circumstances I must abstain from expressing any opinion as to the alleged connection between the occurrences mentioned in the first paragraph and the crime. The Government have prevented, and will continue to prevent, meetings being held under the auspices of the United Irish League when there was, or in the future may be, reasonable ground for believing that the meetings, if held, would lead to intimidation or a breach of the peace.

I beg to ask the Chief Secretary to the Lord Lieutenant of Ireland if he can give the reason for the delay in carrying out the sale to the tenants of the Rae Estate at Keel, County Kerry, and when the sale will be completed.

The delay arose owing to the fact that the owners and incumbrancers had entered into negotiations for the discharge of the Receiver and the dismissal of the petition for sale of the estate. The solicitor having carriage of the proceedings has informed the Registrar of the Land Judge's Court that an arrangement has been arrived at in the matter, and that an application for the purpose mentioned will shortly be made to the Court.

I beg to ask the Chief Secretary to the Lord Lieutenant of Ireland whether he is aware that a number of students in Dublin attacked the Mansion House and tore down the civic flag on 1st March; and that this is the second time in a few months that attacks of this kind have been made; and what steps are to be taken to protect the Mansion House of Dublin from such attacks.

I am informed that on the 1st instant a number of students obtained access to the Mansion House grounds by climbing over the garden wall, and that they then lowered the civic flag and threw it into the adjoining street. The police, however, quickly arrived on the scene and restored the flag to the Mansion House. Several arrests were made, and three of the prisoners, who were at once brought before the divisional magistrate, were fined 40s. each. With regard to the second paragraph, there was a constable on special duty in front of the Mansion House on the occasion in question. He did his utmost to prevent the students from entering the garden, but was overpowered and roughly handled. The occurrence was entirely unexpected and only lasted for a few minutes. I would refer to the statement made by my right hon. friend the Chief Secretary in answer to a question put to him on the 2nd February in reference to the similar reprehensible proceedings which took place at the Mansion House in December last.

May I ask if evidence was not given to the effect that one policeman was knocked down by those loyal students?

I am not aware of that.

May I ask whether the right hon. Gentlemen's attention was drawn to the report of the local police of that case, when it was stated that one police constable was knocked down and kicked?

The only information I have upon the matter is that one constable had his uniform torn, and not that he was knocked down.

Has the right hon. Gentleman any objection to a number of students climbing over the Castle wall and tearing down the Union Jack?

May I ask the right hon. Gentleman whether, in cases where Nationalist disturbances—

Order, order! [After a pause, during which Mr. O'Brien remained standing]: The hon. Member is now repeating the practice to which I have before called his attention—namely, continuing to stand after I have called him to order.

I only want to point a moral.

I beg to ask the Chief Secretary to the Lord Lieutenant of Ireland whether his attention has been drawn to the behaviour of an Orange party in Belfast, who wrecked the houses and places of business of Roman Catholics; whether he is aware that another Orange party, on last Wednesday night, singing "Soldiers of the Queen," broke the windows of the Christian Brothers' Schools, and the glass door and fanlight in the Roman Catholic Club, severely beat and illtreated two young girls who were coming out of St. Patrick's Church, besides doing much damage in Donegal Street, Divis Street, and York Street; and whether, seeing that the police were powerless to prevent rioting on Wednesday night, steps will be taken to prevent similar demonstrations against Roman Catholics on occasions of national excitement.

As far as I can gather from the information before me, it appears that on Wednesday last large crowds of people, accompanied by several bands, marched through the streets of Belfast full of excitement and enthusiasm on account of the relief of Ladysmith. When passing through Donegal Street and York Street a few individuals in the procession, I regret to say, broke the windows in several houses, which, with three exceptions, were the property of Roman Catholics, including the Christian Brothers Schools and the Catholic Club. One girl who was standing in the porch of St. Patrick's Church was struck with a stone, accidentally it would appear. She was taken to the Royal Hospital, where it was found she was slightly injured on the cheek. The police are not aware that a second person was struck, as alleged. Subsequently, and in another part of the city, a Nationalist mob turned out, and by way of retaliation, broke windows in sixteen houses which, with one exception, were the property of Protestants. Owing to the prompt intervention of the police there was no serious rioting or disturbance of the public peace. The police in Belfast are instructed to do their utmost to preserve the peace and to prevent collisions between the rival parties, and this difficult duty they have hitherto succeeded in performing with zeal and efficiency.

This question has been somewhat changed since I put it on the Paper. May I ask whether steps will be taken in case of defeat to secure the Catholics of Belfast from having their windows broken and their premises attacked. We have heard of the retreat of General Buller over and over again, and—

Order, order!

May I ask the right hon. Gentleman if he can answer my question of last Friday as to the occurrences at Portadown?

That does not arise out of the question on the Paper.

I beg to ask the Chief Secretary to the Lord Lieutenant of Ireland in how many prisons in Ireland are there open air exercise yards with shelters in case of rain, and how do the ordinary prisons compare with convict prisons in Ireland. Is he aware that, owing to the humidity of climate, prisoners are frequently given their two hours daily exercise in the rain, and often no exercise in consequence of no sheltered yard being provided; and whether any steps will be taken to remedy this state of things.

It will take a couple of days to collect the information necessary to enable me to answer this question, and I would ask the hon. Member to repeat it on Thursday next.

I beg to ask the First Lord of the Treasury whether, pending the appointment of the Municipal Trading Committee recently promised by him, the Government will oppose, or cause to be deferred, any Bills or clauses in Bills promoted by municipal authorities seeking powers to trade or manufacture.

In answer to my hon. friend I have to say that no general principle, I think, such as he suggests could be adopted. Each case must be considered on its merits, and undoubtedly the fact that a Committee is sitting, or is proposed to sit, upon the subject is a factor that will be taken into account.

I beg to ask the First Lord of the Treasury when he expects to appoint the Committee on Municipal Trading, which on the 19th February he informed the House he proposed should be appointed without delay.

The reference will be put on the Paper in a day or two.

When in October last^* I obtained the authority of Parliament for the issue of eight millions of Treasury bills towards the expenses of the war, I reminded the Committee that, although at that time it seemed justifiable to entertain hopes that the campaign might be brought to a successful issue by the 31st of the present month, no one could fore-

^*See The Parliamentary Debates [Fourth Series], Vol. lxxvii., page 509.

see either the duration or the total cost of such a war as that in which we were engaged. I did not ask at that time for any additional taxation towards the expenditure on the war, for reasons which I think were approved of by the great majority of the country. I stated that, in my judgment, it would be perfectly possible, and it would be right, that the debt proposed to be incurred should be paid off by the end of the financial year after next; and I think that the yield of the revenue since that date has shown that that expectation was absolutely justified. More than that—in my belief, if to that eight millions it had been necessary to add the thirteen millions which has since been voted by Parliament, I feel confident that, without any material increase of taxation, the debt might have been paid off by the date which I named, having regard to that of which I reminded the Committee last October, the capacity of the Transvaal to bear a reasonable share of the expenses of this war. With regard to that point I entirely adhere to the opinion I then expressed; but I am bound to say that the events which have occurred during the past five months, the claims which must undoubtedly be made for compensation by our loyal colonists in Natal for losses sustained at the hands of the Boers, and the enormous increase in the war expenditure compared with that of which we were then speaking, make me feel that the capacity of the Transvaal to bear the cost of this war is a less important factor—though still an important factor—than I estimated it to be in October last. We must recognise that since that time the whole financial situation has changed. It is not merely that we have had to add £13,000,000 to the £10,000,000 then voted. It is that, in spite of the happy turn which events have recently taken, we feel that there is still so much work before us that it has been our duty to lay on the Table Estimates involving an expenditure of not less than £38,000,000 in the year that is to come on account of the war in South Africa and in defensive preparations at home, which are necessarily a part of the war. Therefore, we have to face a total estimated expenditure of six times as much as that with which we were dealing in October last. Now, it would have been necessary for me in any case to make an application to Parliament in the course of the present financial year to authorise a loan—for it must have been a loan—of some £5,000,000 or £6,000,000 towards defraying the war expenses to be incurred before the 1st of April, and the heavy payments which fall upon the Exchequer for other matters early in April, up to the date when the Budget is ordinarily introduced. But Her Majesty's Government have had to consider whether a partial proposal of that kind would have been consistent with an adequate performance of their duty to the House and to the country. In the first place, such a course would have been open to some financial objection. The issue of a small loan of that kind, when, from the Estimates presented to Parliament, it was perfectly obvious that a very much larger expenditure was required, a part of which might have to be met by a loan of much greater magnitude, would have been an operation which would have disturbed the money market and have been antagonistic generally to the public interest. Then, those astute persons who are large dealers in dutiable goods, and who have a very intelligent anticipation of future events, have already been taking measures during the existing quarter—measures which I am afraid have been intensified in the last few days—which are distinctly detrimental to the revenue of the country. But we had to consider not merely the financial aspect of this question. We felt that, having laid these enormous Estimates upon the Table, Parliament had a right to expect from us without delay a full explanation of the financial situation which they involved and a statement of the measures which we, in our belief, thought necessary to meet the exigencies of the public service. We thought, also, that the people on whose judgment and opinion the future course of this war must depend had a right to know what we were doing and to be informed how the grave circumstances with which we had to deal necessitate, in some form or another, an increase of the burdens of the country. But, perhaps, most important of all, we felt that it was right that by the promptitude with which we met our liabilities we should afford proof to our adversaries and to our foreign critics of our earnestness in the work in which we are engaged—proof, perhaps, even more valuable than success in the field. Therefore, my duty to-night is not merely to make a temporary proposal for tiding over the few weeks that will elapse between now and the ordinary time for the introduction of the Budget, but to lay before the Committee an exposition of the measures by which we propose to provide for the expenditure of the coming year, the Estimates of which have been laid before Parliament. An early Budget is unusual, but it is not unprecedented; and I am sure the Committee will generally feel that those are times in which an early Budget is absolutely justified. But it is a matter of great inconvenience to the Chancellor of the Exchequer of the day. It is no easy thing, in these times of great and rapid increases in our expenditure and revenue, for anyone to estimate eleven months beforehand what will be the revenue and expenditure of the coming year. But that difficulty is enormously increased when these Estimates have to be based, not on the facts of the preceding year, but on Estimates themselves. A great part of our expenditure now, unhappily, is on warlike operations in South Africa. We have, to the best of our power, made Estimates of the cost of those operations during the present year, and the House has voted them; but no one can tell us whether the actual expenditure will be accurately represented by those Estimates. It may be more; it may be much less. Again, I have the facts before me of the revenue for nearly eleven months of the year; but I have nothing but estimates of the revenue of the month which still remains. Therefore I need not detain the Committee by arguing how much the ordinary difficulty of estimating the finance of the coming year is added to by an early Budget. For this reason, in the Paper which is now in the hands of hon. Members, I have directed that it should be distinctly stated that the figures are but provisional figures. I do not think it is possible, with regard to details, to draw any comparison between those figures and the figures of past or future years. But I shall take care that, as soon as possible after March 31st, accurate figures, with regard both to revenue and expenditure for the year 1899–1900, shall be placed before Parliament, by which such a comparison may be made. To-night I shall not trouble the Committee with the ordinary details of the revenue of the year 1899–1900. I will deal more with general figures. Last April^* I estimated the Exchequer revenue of the present year at £111,157,000, that is, at £2,821,000 over the Exchequer revenue of the previous year. In October last I was able to inform the Committee that, in my judgment, that estimate would be largely exceeded; and now I am glad to be able to state that, in my belief the revenue of the present year will amount to at least £116,040,000. I base all those calculations upon figures arrived at before Saturday last. There have been some remarkable circumstances in regard to clearances of dutiable articles on Saturday and to-day by which these figures may be largely disturbed, but the effect of which will, of course, be shown when the full and accurate figures of the year are presented to Parliament. I estimated, last April, the expenditure of the year at £110,927,000. Since then the House has voted Supplementary Estimates of £745,000; and I had to deduct £1,132,000 of savings. So that the total Exchequer expenditure, but for the war, would have amounted this year to £110,540,000, showing a net surplus of £5,500,000. But, of course, I have to add to that £23,000,000 of Supplementary Army Estimates for the war, and also £270,000 for interest on the Treasury bills of £8,000,000 authorised last autumn. That makes a total Exchequer expenditure for the year of £133,810,000, showing a deficit of £17,770,000, of which £8,000,000 have been temporarily provided for by the issue of Treasury bills. In other words, we have provided towards the war expenditure £5,500,000 from the abounding revenue of the year. This is the one agreeable feature in my otherwise disagreeable task to-night, and I hope the Committee will pardon

^*See Budget Statement, April 13, 1899. (The Parliamentary Debates, Fourth Series, Vol. lxix., page 993.)

me for dwelling for a few moments at this oasis in the desert. It bears remarkable testimony to the extraordinary industrial activity and commercial prosperity of the year 1899. It is one of a period—I hope of a long period—of prosperous years; but it has been by far the most prosperous of all. And the improvement in our trade has not been gained by any unwise speculation or undue excitement. I believe that it is due to a steady and substantial progress in business. Nor has it been due to the war. The stringency of the money market during some of the winter months; the withdrawal of many thousands of men from their ordinary occupations for military service; the military demands for coal and iron and others of our great staples, and for transport, which must necessarily have increased the cost of our foreign commerce; even the diminution among the wealthier classes of the ordinary festivities of the year—all these things, directly due to the war, cannot have been for the good of trade during the course of the year, and may, perhaps, have even a greater influence upon the year that is to come. But in spite of that the increase of our foreign trade both in exports and imports has been greater than in any previous year. The increase in the value and the volume of our foreign exports has been quite exceptional, and that not merely in coal or iron or textile manufactures, but in all the main articles of our trade, and it has been diffused over the whole area of our foreign commerce. This increase in foreign trade has not been gained at the expense of our home consumer, as it sometimes is in those countries whose manufacturers are enabled to sell cheaply abroad by artificially enhanced prices deliberately secured to them in their home markets. No; all the statistics show that the prosperity of our trade at home has been at least as great as the prosperity of our foreign trade. Prices have risen in almost everything excepting, I am sorry to add, in the important articles of agricultural produce. But the additional amount that we have had to pay for our imports has been far more than compensated by the gain to the nation in higher prices it has received for its exports. The value of what are known as "gilt-edged securities" has, no doubt, largely fallen. But this has not been due to any want of confidence in the country. The simple reason is just this—everybody has found it easy to obtain a far more profitable employment for their capital than by investing it in Government or municipal securities, or railway debentures. Wages have risen considerably; employment has been plentiful; labour disputes have been few and unimportant; and the result of the whole year has been this—that the purchasing power of the working classes has been largely augmented, reacting, of course, on trade, and acting largely on the receipt of the revenue. The receipts in the Customs and the Inland Revenue from the great articles of beer, of spirits, and of tea have increased largely. No doubt, part of that increase is due to the premature withdrawals from bond to which I have already referred; but quite apart from that they have increased largely. Tobacco and wine have not done quite so well. I am free to admit that tobacco has disappointed my expectations. It may be that this is due to the fact that many thousands of our principal smokers are now in South Africa; but with regard to wine, we have had a considerable increase in the receipts from the wine duties. Of course that was expected, owing to the increase of the wine duties last year, but the increase has not been quite so large as I anticipated. I think, really, that is due to the absence of the ordinary festivities in the winter. But there is nothing in the receipts from tobacco or wine, or from the other heads of Customs and Inland Revenue, which in any way detracts from the evidence which all the returns afford of the general prosperity and comfort of the people. But a more remarkable increase than that under the head of Customs and Excise is to be found in the receipts from the death duties. The receipts from the death duties by the Exchequer during the present year will, I anticipate, amount to £13,300,000, as against £11,400,000 last year. To that you must add the receipts from death duties by the Local Taxation Fund—£4,171,000—making a total receipt from the death duties of £17,471,000. I think that the wildest dreams of the right hon. Member for West Monmouthshire hardly anticipated that this taxation would produce this amount. But now I wish for a moment, if I may, to detain the Committee in examining to what this large increase in this year is greatly due. A substantial part of it, I am glad to say, is due to receipts from estates under £250,000 in value. But I have to place before the Committee a case which, I think, affords a singular proof of the manner in which any estimates of the receipts from death duties in any year may be utterly upset by the mere accident of a single death of the owner of enormous property on whose property very high rates of duty would be charged. You can average the estates under £1,000,000 in value; you can take the receipts from over a period of years, and fairly estimate in that way what the probable receipts may be in the year to come; but when you come to estates over £1,000,000 it is absolutely impossible. In 1896–97 there were five estates of millionaires, which paid to the revenue £436,000; in 1897–98 there were nine such estates, which paid £1,212,000; in 1898–99 there were again nine such estates, paying £941,000—an average for the three years of £863,000. I suppose that if I had taken from that average an estimate of £950,000 from the year in which we stand I should not have been blamed for having taken an unfair estimate. But what has been the actual result? We have received during this year from the estates of millionaires close on two millions in Estate Duty, and the vast sum of £900,000 in Death Duties has come from the estate of one man, a foreigner, who, I am told, lived on 15s. a day in a West End London club. That one person, however unwillingly, has contributed to the Exchequer more than the cost of an iron clad. I am filled with patriotic sentiment at such a contribution to the death duties, but I hope my right hon. friend the First Lord of the Admiralty will not make this a reason for asking for more, because the Committee will see that it is not within the reasonable bounds of expectation that such a windfall as this should occur in subsequent years. The stamp duties will probably produce £350,000 this year over the Budget estimate. The increase of stamp duties last year in certain points mainly related to dealings on the Stock Exchange. It has not been a very busy year on the Stock Exchange, but I am informed that the increased duties will produce the amount which I estimated. It is too early to say with any certainty what the receipts from the income tax will be, because, as hon. Members know, the great bulk of the income tax is collected in this quarter, and we have still a month of the quarter before us. But so far the income tax is doing well. We expect to have an increase of revenue from the Post Office, and other sources of non-tax revenue, of £573,000 over the Budget Estimate. I do not think there is any head of revenue which has not contributed something to the surplus which I have described to the House. I stated that the total expenditure from the Exchequer in the year was estimated at £133,810,000. I have to add to that £9,599,000 to be paid to the local taxation account—an increase of £78,000 over last year—and the expenditure on capital account of £4,847,000, of which £1,861,000 is derived from the surpluses of previous years, on barracks, telephones, the Uganda Railway, naval and military works, and the acquisition of the territory of the Royal Niger Company. The total expenditure for which the State is responsible this year is estimated at £148,257,000, compared with £121,224,000 last year. The Exchequer balances on April 1, 1899, were £8,919,000. Of this £1,861,000 belongs to previous surpluses, and had been allotted by Parliament to naval and military works. That has been issued during the year, and the Exchequer balances on March 31 next will, I anticipate, be about £7,130,000 unless it be necessary to draw upon them to any extent for war expenditure, which I think should not be done beyond an amount, say, of £2,000,000. The total debt of the country on April 1 last year was £635,041,000. Of this £7,479,000 was reproductive debt outside the fixed debt charge, borrowed almost entirely on terminable annuities for thirty years, the principal and interest of which are annually repaid by Votes submitted to this House. That debt now amounts to £10,185,000. The total dead-weight debt on April 1st, 1890, amounted to £627,562,000. Of this £583,186,000 was Funded Debt, £36,243,000 the capital value of terminable annuities, and £8,133,000 floating debt in Treasury bills. Since that time we have cancelled £30,715,000 of Funded Debt, of which 28 millions were cancelled by exchange for terminable annuities, the remaining £2,715,000 being reduced by the operation of the Life Annuities and new Sinking Fund. On the other hand, we have increased the capital value of the terminable annuities by £24,242,000, the operation being the result of the provisions of the Finance Act of last year, and we have, as the Committee are aware, borrowed £8,000,000 by Treasury bills since last October. The net result is that the total dead-weight debt has increased by £1,527,000. But for the war expenditure having to be provided for by the issue of these £8,000,000 of Treasury bills, the Debt during the year would have been decreased by about £6,500,000. That, I think, is not a very unfavourable record, but, unfortunately, I have to add to it that out of the anticipated deficit of the present year there remains a balance of £9,770,000 still unprovided for, and when we come to the year before us, I am afraid the prospect is even worse. Now, the Consolidated Fund services of 1900–1 are put at £26,000,000, an addition of £250,000, being the amount on account of interest on the £8,000,000 of Treasury bills already authorised. The Supply services amount to £128,082,000. As compared with last year's Estimates, the Navy has gone up by £928,000, the Civil Service Estimates by £659,000, Post Office and Telegraphs by £415,000, and, of course, the Army by the gigantic sum of £40,883,000. Of this, £37,797,000 is expenditure either directly on the war in South Africa, or connected with and due to the war—such, for example, as the embodiment of the militia in this country, the enrolment of veterans for temporary service, greater facilities and encouragement for the training of Volunteers and Yeomanry, and the provision of mobile guns for the Volunteers. The total estimated expenditure for the year is £154,082,000, an increase of £43,155,000 over the Estimate of last year. Now I turn to the estimated revenue to meet that expenditure. I take the existing basis of taxation. I estimate the Customs, after allowing something, though, I fear, hardly enough, for premature clearances, at £21,900,000, Excise £31,800,000, death duties £13,000,000, stamps £8,400,000, land tax £800,000, house duty £1,650,000, income tax £18,800,000—a total tax revenue of £96,350,000. I estimate receipts from the Post Office at £13,800,000, telegraphs £3,550,000, Crown lands £450,000, Suez Canal shares and sundry loans £850,000, miscellaneous £1,900,000—the total non-tax revenue thus being £20,550,000. This makes a total revenue of £116,900,000, as against the expenditure which I have stated, leaving a deficit for the year of £37,182,000. But, in passing, I should like just to draw the attention of the Committee to this fact, that, out of the Army Estimates, to which, of course, that great deficit is due, £37,797,000 are distinctly War Estimates, and you have to add to that £250,000 for interest on the war debt, making altogether £38,047,000 for war services. That is £865,000 more than the deficit. Therefore, I think the Committee will see that the ordinary revenue of the country would well cover in the coming year the ordinary expenditure, including in that ordinary expenditure nearly £3,000,000 for various increases to the Army, such as the formation of twelve new battalions and forty-three new batteries of artillery. But, of course, it is clear from these figures that the question before the Committee and the Government really is not how the ordinary expenditure but how the war expenditure is to be provided for. Well, now, what is the amount we should consider in dealing with the war expenditure? We have made the best calculation in our power of what in our judgment it would be right for us to ask from Parliament with a view to the successful prosecution of the war. But it is impossible for us to be certain that the war will be concluded by September 30th next. All I can say is that we do not believe that it is probable that the war expenditure will in any case be less than the Estimate which we have laid on the Table of the House. It may be more, but, as against that, you have to consider the happy change in the military situation which has recently occurred, and the fact that the season is fast approaching which, I believe, all our authorities agree in considering is peculiarly unfavourable for the military operations of the Boers. We may be obliged in July or August next, unhappily, to ask Parliament for further provision, but I think we are fairly justified in the hope and expectation that the Estimate which we have placed on the Table will be sufficient to conduct this war to a successful termination. But I am obliged to add something to that statement. I do not know whether hon. Members have carefully studied the memorandum which was circulated by Lord Lansdowne.^* If so, they will see that the Estimates do not include all the expenditure for military purposes which he thinks is probable in the year. An important war like this must necessarily be very costly to our reserves in all departments—to guns, to ammunition, to stores; and we are carefully investigating at the present time what provision should be asked from Parliament to place our reserves, both military and naval, in the state in which the country would desire them to be, and I am quite sure that Parliament will not grudge any necessary expenditure for that service. I feel myself justified in saying that, having regard to the probability of the expenditure before us in the coming year, and also to the provision that must be made for the interest upon any loan that Parliament may sanction towards the war expenditure, I think about 5 millions ought to be added to the 38 millions and the 17¾ millions to which I have already alluded, making in all a total amount of 60 millions, the provision of which we ought to consider with regard to the war. That is a very large sum, and the question is how can it be provided? I do not think anybody will suggest that it ought to be provided out of the revenue of the year. There are objections, of course, to a Government loan. A Government loan withdraws capital from the money market which might be better employed in reproductive works. But we are talking of £60,000,000. If it were a question of £10,000,000 or £15,000,000 we might fairly claim, as has been said in past years, that it was a matter to be provided out of the revenue of the year. But to impose taxes so high or so numerous as to provide an additional revenue of £60,000,000 would be to cripple industry and fetter the movement of capital and disturb it in its accustomed employment—a far worse evil to the country than

^*See Appendix to this Volume.

the issue of a Government loan. Therefore, I need not argue against the idea that such a sum as £60,000,000 should be provided from the revenue of the year. But I have seen this morning a suggestion that half of it should be so provided, that we should make this an occasion for an entirely new and extraordinary fiscal departure—that we should raise £30,000,000 in addition to our present taxation this year, partly from the income tax, but also from new indirect taxation—a sugar duty, a duty on corn, a duty on meat, a duty on all agricultural produce, and last but, perhaps, most extraordinary of all, in view of what we have done for many years past in cheapening postal communication, by adding £4,000,000 a year to the postal charges for the benefit of the revenue. Well, this is suggested not merely to pay for the war expenditure of the year, but because it is considered that when the war is happily over, in a time of peace, the standing Army of this country is to be increased by 150 per cent., and £20,000,000 a year is to be added to our Army Estimates. I have the greatest respect for the ability of the writer who has propounded these new fiscal doctrines I have no doubt he would be a much better Chancellor of the Exchequer than I am, but all the same I venture to characterise such proposals as these as in my judgment unwise and impracticable to the last degree. There is a more seductive and a more dangerous idea afloat of quite another kind. It is said, "Oh, this is war expenditure; you will get it all out of the Transvaal some day. Never mind the future; borrow it all now. Raise taxation if you like to pay the interest on your loans—possibly even a small sinking fund." The Sinking Fund which was established at the time of the Crimean War was abolished the first year after the Crimean War was over. There is nothing more comfortable or more agreeable or more easy for a Chancellor of the Exchequer than to adopt this policy of borrowing; but it is the duty of a Minister, and especially the duty of a Chancellor of the Exchequer, not to mind what is disagreeable or what is unpopular if he believes it to be right. And in my belief, and in the belief of all my colleagues, if we adopted such a course as this we should be unworthy of this country and of those who have gone before us. We should be taking the first step on a path of systematic deception of the people, which, if followed, could but end in financial ruin. Let us look back to the history of the past. There have been two great occasions in the last 100 years in which serious additions have been made—though in very varying degrees—to the National Debt for war expenditure. The first was the great French war, and the second was the Crimean war. I believe that the increase of the Debt during the great French war was no less than £622,000,000. Now, what was the history of that war? In the earlier years of that war, from 1792 to 1798, Mr. Pitt pursued the fatal policy of borrowing each year what he required for war expenditure, and practically providing nothing by taxation except the interest on his loans. What was the result? He borrowed, and he increased the National Debt by £200,000,000. For that increase he got only £108,500,000 in cash. He began to borrow at a rate of interest a little over 4 per cent. By 1797 that rate of interest had increased to 6¼ per cent. and more; and I have no doubt it is true, as I think it was once said, that out of our National Debt there is no less than £250,000,000 for which the State has never received a single halfpenny—a mere sacrifice to capital, to induce it to lend, without reducing in any material degree the interest on the loans. Happily for us, happily for the country, in 1798 Mr. Pitt turned over a new leaf. He raised £10,000,000 by the income tax, and continuously from that time to the close of the great war the expenses of the war were met partly by loans no doubt, but also largely by taxation. Three hundred and ninety-one million pounds were raised during that time by our forefathers in taxation towards the expenditure on that war, and that at a time when the country was poor, when the population was small, when they were willing cheerfully to bear 2s. in the £of income tax for thirteen years of the war, besides indirect taxation of the heaviest kind upon every conceivable article, including the necessaries of life, because they were brave enough to save the country from financial ruin. Then there were forty years of peace, and the country was again called upon for a special effort at the time of the Crimean War. Mr. Gladstone, at the commencement of that war, endeavoured to raise the whole war charges by increasing taxation. That was soon found to be impossible. In 1855 Sir George Cornewall Lewis budgetted for a war deficit of £23,000,000—much less than what I have to find. He proposed to raise of that £7,000,000 by taxation, and £16,000,000 by loans; and if hon. Members care to study the finance of the Crimean War they will find that out of £67,500,000 which that war cost the country, no less than £35,500,000 was met by additional taxation. And now, at the end of another fifty years—during which we have seen abatements of taxation in which our forefathers never would have believed, during which we have seen the country as a whole rise to a degree of wealth and prosperity and comfort which they never could have guessed—we are again face to face with a costly war. Sir, I do not compare the present war with the great French War; that was a struggle for life or death prolonged for years. I do not compare it even with the Crimean War. We have to fight a brave, a skilful, and a warlike foe, but the resources of the two Boer Republics are but as nothing compared with the resources of the great empire of Russia. But in proportion, in my humble belief, this war will prove more costly than the Crimean War; and I will tell you why. Because we have had to send to the other side of the world by far the greatest force that has ever left this country; and having sent it, in view of possibilities to which I need not do more than allude, we have felt it incumbent upon us to provide, at great expense, for the defence of the country during the absence of that force. Therefore, I think I may say that although we are perfectly justified by the constant practice and the uniform example of our forefathers in deriving a large part of the funds necessary for the prosecution of the war by the issue of a loan, yet we are also bound to call upon the taxpayers of this country for some immediate and substantial sacrifice, instead of mortgaging the industry of posterity for the whole cost of a war, some part of which we, surely, in these days of prosperity are well able to bear. I think there are some things which, in considering this matter of taxation, we ought to bear in mind. In the first place, I have alluded to the probable duration of the war. I think we may reasonably anticipate that, however prolonged the resistance of the Boers may be, this war in its more acute and costly phase will not be along war. I think that is a reasonable anticipation. Therefore, our necessity being as it is—a temporary necessity for meeting war expenditure—I do not think it is wise, from a financial point of view, to meet a temporary necessity by permanent fiscal changes. Again, I think we should endeavour as far as possible to meet that temporary necessity by additions to existing taxation instead of by the imposition of new taxation, and certainly that we should endeavour to derive what we need of taxation rather from largely productive taxes than from imposing innumerable small charges here and there, such as many of my correspondents suggest to me, over all kinds of interests and classes in the country, which would raise really a very small total all put together, but which would create extraordinary vexation and worry in the operations and calculations of very many people. Well, but, Sir, there is another thing. During the last four years the proportions in which our revenue has been derived from direct and indirect taxation have not materially varied. The portion of it derived from direct taxation is rather less—a slightly increasing proportion—than that derived from indirect taxation, but there has been no material variation. I think those proportions are fair. I do not agree with those persons who would desire to upset them largely from either side, and I think that as the result of any fresh taxation we now propose, we should endeavour, as far as may be, that those proportions should not be materially varied. Now, having said this, I will proceed to what I feel the Committee is anxious to hear—namely, what are the precise taxes I am going to suggest. In the first place, I turn to the income tax. The income tax has always been considered a tax that might properly be augmented on the occasion of a war, and that for the obvious reason that it can be dealt with either by way of raising it when required for a war, or by way of lowering it when the war is over without any practical disturbance, either of trade or commerce. The income tax was the main source from which the Ministers who were responsible for taxation at the time of the Crimean War drew the increased revenue they required; and since that time there has been occasion more than once on which, for our smaller wars or preparations for war, practically the whole of the increased taxation imposed has been drawn through the income tax. But I am bound to say that circumstances since that time have changed. The income tax was the main source in the time of the Crimean War of direct taxation. The great increase of the death duties in our time has made a considerable difference, to my mind, in that respect, and it must fairly be considered in dealing with this subject. On the other hand, since the Crimean War, the incidence of the income tax on certain classes who felt it heavily has been materially lightened. For example, in 1894 the right hon. Gentleman the Member for West Monmouthshire gave what I admitted then and always have admitted since to be a great boon to the owners of property, whether in houses or land assessed under Schedule A, by allowing them a considerable deduction from their assessments in calculating their income tax, which has made a material difference in the poundage of income tax on that class of income-tax payers. Then, again, at the time of the Crimean war all persons with incomes above £100 a year paid income tax. Since then it has been provided that nobody with an income not exceeding £160 shall pay income tax at all, while the lower classes, so to speak, of income tax payers have been materially relieved by the abatements in the income tax on incomes between £160 and £700 a year, which, again, deduct from their income tax some very material poundage, especially in the lower grades. And, therefore, while we have to consider, on the one hand, that the pressure of direct taxation as a whole is greater than it was in former years, so we have to consider, on the other hand, that the incidence of the income tax itself is lighter on those classes who are most heavily burdened. Well, at the time of the French war, as I have reminded the Committee, there was an income tax of 2s. in the £ for thirteen years. I do not propose to impose that now. At the beginning of the Crimean war—before the war began—the income tax was 7d. in the £. It was at once raised to 1s. 2d. in the £, and in the second year of the war it was raised to 1s. 4d. in the £. I do not propose to impose either of those rates now, but I do ask the income-tax payers to make some sacrifice; and, having regard to the past, I do not think they can fairly complain of paying a very substantial contribution towards the cost of this war—namely, an increase of the tax by 4d. in the £ to 1s. in the £ for the coming year. That will produce in the year before us £6,500,000. In the year following there will be arrears to come in of £1,900,000. Next, Sir, I have a small addition, or rather what I may call a rectification of the law, with regard to direct taxation in the matter of stamp duties which I propose to make. At present, as the Committee are aware, there is a stamp duty of 1s. on what are called contract notes which are delivered by brokers to their clients in transactions on the Stock Exchange. Well, Sir, precisely similar transactions, in precisely the same form, are carried out by brokers in many produce exchanges throughout the country, and in other ways. I propose that the 1s. duty shall also be imposed upon those contracts, and I am told that these transactions are so numerous that the result is likely to be an increase to the revenue by £150,000 a year. I now turn to what will be more interesting to the Committee—indirect taxation. I said last October that I thought it would be grossly unfair to impose additional taxation upon the income-tax payers alone for the purposes of this war. I still entertain that opinion, and I think we are bound to make considerable increases also in indirect taxation. My principle is this—that so far as may be all should pay something towards the cost of this war, but the richest should pay the most.

Tax diamonds.

Now, last year we raised the wine duties with, I think, satisfactory results. I naturally turn this year to beer. There has been a great increase during the past few years in the production and consumption of beer. In 1895–96 the duty on beet yielded £10,719,000. This year it is expected to yield more than £11,900,000. I propose to impose an additional 1s. a gallon on beer. I beg pardon for exciting the apprehensions of my hon. friends; of course, I mean 1s. a barrel of thirty-six gallons. I estimate that that will produce £1,752,000 in the course of the twelve months. Having increased the duty on beer, I next come to spirits. Now spirits have been somewhat favoured of late years as compared with beer. In 1894, I think, the right hon. Gentleman the Member for West Monmouthshire imposed an additional 6d. a gallon on spirits and 6d. a barrel on beer. In the following year he took off the 6d. a gallon on spirits, but he retained the 6d. a barrel on beer, and that has remained on beer since. Therefore, so far I think I am right in saying that of late years spirits have been rather favoured. What is the position of spirits? The position of spirits at the time the right hon. Gentleman proposed his duty was a very bad one. The trade was bad, and by his having unfortunately selected too early a date for the cessation of the duty the dealers in spirits, with their natural cunning, were able to delay their clearances, and thus to deprive him of, I think, a very large part of the yield which he expected from the duty. Now, Sir, circumstances, I hope, are different. The production and consumption of spirits has enormously increased of late years. I find that the excise duty on spirits produced in 1895 was £15,603,000, while this year it is expected to produce £18,500,000. I think that, having regard to that fact, we may very properly impose another 6d. a gallon on spirits. I wish to say that, with regard to this as well as the rest of the indirect taxation which I am about to propose, I look upon it as a temporary addition to the existing taxation—I hope merely for the coming year; but I propose in all cases to enact now that the additional taxation shall last until the 1st of August, 1901—not, I hope, that it will be necessary to levy it so long, but that it may be dealt with at the ordinary time in the Budget of the year, and that the date of its expiry may be fixed far enough beyond the Budget to prevent dealers in these dutiable articles from doing what they did in 1894, and keeping back their clearances until the Budget was introduced. I hope that will be clearly understood with regard to the date for which I propose this taxation. My estimates of the yield of it are solely for the twelve months. I estimate that 6d. a gallon additional on spirits will produce £1,015,000. Now, Sir, we have dealt with the income-tax payer and the consumers of alcohol. I think it will be felt generally that tobacco ought to bear some further burden. I confess it is with great regret that I find myself driven again, after so short an interval, to alter the duty on tobacco. I know the inconvenience to the trade, and I regret it, but I think it would not be fair that tobacco should be exempted from taxation. Now, Sir, what we did in 1898 was this: we reduced the tobacco duty by 6d. in the pound. We also reduced the legal limit of moisture from 35 to 30 per cent. I anticipated a very considerable increase in the consumption from that reduction. My anticipations, I have to admit, have not been realised. It may possibly be that a comparatively small reduction in the price of tobacco does not materially increase the consumption. It may be that the trade statistics, which certainly convinced me that the reduction had reached the consumer, were less accurate than I had supposed. I wish to be perfectly frank, and I have endeavoured to be so. But we have to consider whether we should merely put back the duty and the moisture to the same amount as two years ago, or whether we should do something else. Now, Sir, I confess I am reluctant to again increase the legal limit of moisture. The result of the reduction of the legal limit was this, that the smoker of the cheapest tobacco, which is most watered, got threepence worth more of tobacco in every pound. He bought more tobacco for his money than he did before in place of a similar weight of water. Well, if I restore the old limit of moisture the result would be that the smoker of the cheapest quality of tobacco would lose that tobacco and get water instead, and as water does not pay the tax the revenue would lose also. No doubt the dealer would gain, but I do not see why the dealer should gain at the cost of the consumer and the revenue. What I think would be fair, after having gone somewhat fully into this matter, would be to retain the present limit of moisture and to increase the duty by 4d. in the pound. I would also propose to increase the duty on foreign cigars by 6d. in the pound. I anticipate that will yield altogether an addition of £1,100,000 to the revenue. We have now got the smokers on our list. But there is a very large population who do not pay income tax, who do not consume alcohol, and who do not smoke, and I think they ought to pay something towards the expense of this war. I look for an article which in our days is comparatively cheap, which is not the subject of any manufacture in this country, or ought not to be, and which is very largely consumed—I look to tea. At the time of the Crimean War the duty on tea was 1s. 6d. in the pound. It was promptly raised by threepence in the pound with practically, I think, no objection from anybody whatever. The duty on tea in 1889 was 6d. in the pound. My right hon. friend the present First Lord of the Admiralty reduced it by 2d. At that time the average wholesale price of the pound of tea was 10·79d., making altogether, with the 6d. duty, 16·79d. per pound. Now I am informed that the average wholesale price of tea is 8·87d. per pound. If I were to add 2d. to the duty, that would make altogether, with the duty, 14·87d. per pound—2d. per pound less than the price in 1889. I propose to add 2d. per pound to the duty on tea, and that will produce £1,800,000 in the course of twelve months, and I do not think that the population at large will have any very fair ground of complaint at the amount they will be called on to bear towards the cost of what the vast majority of them believe to be a necessary war. The total result of the additional taxation I propose will be an increase in the revenue of £12,317,000, besides the £1,900,000 arrears of in come tax which will fall into the future year. Then I propose to reduce the expenditure. In the year 1885 the country was called upon to find, I think, £11,000,000 towards preparations for war. On that occasion, with the unanimous consent of Parliament, it was agreed to stop the re- payment of capital wrapped up in the terminable annuities belonging to the various Government Departments, and included, of course, in the fixed debt charge for the year. I propose to do the same thing now. That will reduce the expenditure of the year by £4,640,000. I think it would be perfectly absurd that, while we have with one hand largely increased our debt we should be paying off old debt with the other. Now, Sir, I come to the final balance-sheet. I stated that the public expenditure of the coming year would be £154,082,000. I deduct from that £4,640,000 owing to the procedure I have just stated, leaving the total expenditure £149,442,000. Against that I anticipate a revenue from Customs, £25,017,000; Excise, £34,350,000; death duties, £13,000,000; stamps, £8,550,000; land tax, £800,000; house duty, £1,650,000; income tax, £25,300,000; making a total tax revenue of £108,667,000, and a non-tax revenue of £20,550,000, or a total revenue of £129,217,000, as against an expenditure of £149,442,000, thus leaving a deficit for the year of £20,225,000. Add to that the expected deficit on this year of £17,770,000, and £5,000,000 which I have stated must be added for the contingencies I have named, and you will find a total of, say, £43,000,000, which I must ask permission to borrow. Part of that will be provided to the extent of £8,000,000 by renewing the Treasury Bills which were issued under the authority of the House given in October last. Therefore there is £35,000,000 of new debt to be incurred. Now I do not think I need argue that such a sum as this is too large to be added to our floating debt. It would be practically impossible, I think, to deal with it in that way. On the other hand, I confess that in my opinion it would be a mistake to raise it by a new issue of Consols. Of course there are arguments in favour of such a course. Consols are a very large stock. They are very well known, and therefore command a better price in the market, comparatively, than other Government securities. Therefore an issue of Consols might possibly be done at a cheaper rate at the moment than another form of issue. But an issue of Consols would be an issue of permanent debt which this country would be unable to pay off until 1923. Well now, what have we seen lately? A few years ago I was redeeming Consols at the price of 14 per cent. premium. A few years hence, when peace is concluded, the length of the term for which Consols cannot be paid off at par, will, I anticipate, have a great effect in producing a rise in their present value. If I borrow Consols now I should have to borrow, at a rate governed by the present market price of, I think, less than 101, the same debt which a few years ago I paid off at a 14 per cent. premium, and which we may hope in a few years may again be paid off and would have to be paid off at a premium though possibly not so high. For these reasons I do not think it would be advisable that we should look to an issue of Consols. I think it would be better that part of this £35,000,000 should be reserved—I think probably a sum not exceeding £5,000,000—for a further issue of Treasury bills if required. The rest I should propose to raise by bonds or stock issued for a term of years not exceeding ten. I have reason to believe that it would be possible to place such an issue on very reasonable terms, and I should hope to be able to do it in a way which would not ensure profit merely to a few great and wealthy persons but would bring the whole public into what I may call a war loan and enable them to come forward to the assistance of the country. I would ask the Committee to pass a resolution enabling me to borrow in the manner I have described to the extent of £35,000,000 without fettering me as to the precise terms and conditions of the issue. At the time of the Crimean war, and before it, the Chancellor of the Exchequer of the day used to come down to Parliament on such an occasion and tell them he had contracted with certain parties for an issue of Consols, or whatever the stock might be, at a certain price, and all that Parliament had to do was to confirm the contract when made. I have not deemed such a course desirable now. I ask Parliament to give me authority to borrow, but in my belief it would be contrary to the public interest to specify beforehand the precise terms and conditions of the loan. I will do my best for the State, and then I will come to Parliament and insert in the Bill whatever terms and conditions may have been decided upon. I do not propose at present to make any special provision for paying on this loan. It ought, in my judgment, to be done at the close of the war, but it would be premature to do so before we know our total liabilities, and how much can be properly exacted from the Transvaal. But I may point out that between now and 1910 we have ample means in prospect to meet whatever may fall upon ourselves. Between 1902 and 1904 the fixed debt charge will be relieved of the converted annuities to the amount of £684,000 a year, and of the great Chancery annuities to the amount of £2,943,000 a year, and, further, in 1903, of ¼ per cent. on Consols to the extent of £1,300,000 a year. I think the Committee will see, without my saying anything further on this point, that ample means are before us to be utilised to any extent that may be right and necessary in the matter of the repayment of the loan now to be borrowed. I have now finished my task, and I have to thank the Committee for the patience with which they have heard me. We have thought it right on this occasion to endeavour, though it is a time of war, to adhere to the old practice of one financial statement in the year. It is better, and it is fairer to Parliament. We have asked for no more than we believe will be required. We may have to ask for more, but even if in July or August next we should have to ask for more it will be better to have made this large request at once than to annoy the House of Commons with repeated requests, whether for additional taxation or whether for additional loans, none of them adequate to the real emergency of the situation. My proposals may or may not commend themselves to the Committee, but I hope the Committee will feel that, at any rate, I have placed before them, to the best of my power, a plain and honest statement—endeavouring to conceal nothing and to extenuate nothing, however disagreeable the facts or the proposals may be. But I hope the Committee will agree to my proposals, for I think they are justified by the circumstances of the time, and they are based upon the best financial traditions of the country. This is not a time, disagreeable as increased taxation may be, at which we should shrink from showing our confidence in the resources a four country, or in the self-denial of our people. Foreign nations are watching us, sometimes, I fear, with no friendly eye, to see whether years of comfort, of peace, of increasing wealth, have softened the fibre or diminished the courage and the tenacity of purpose of our race. Our soldiers in the field, from whatever part of the Empire they have come, have shown that they are equal to their forefathers. Our great colonies, though perhaps at first sight not so directly interested in this war as ourselves, have eagerly taxed themselves in men and money for the cause of the Empire. Shall we, who sit at home at ease, show ourselves at such a moment financial cowards? Shall we confess to the world that the cost of a few months of war frightens us out of a financial policy which we know to be sound? No, Sir, I do not believe it. We have placed before this House, during days and weeks, our views as to the policy and conduct of this war. We have defended ourselves, I hope not unsuccessfully, against the imputations and charges that have been made. Opinions on these subjects may differ, but there is one thing on which the great majority of this nation has made up its mind, and that is that, at whatever cost, this war shall be prosecuted to a successful termination. To-day we ask you to provide means to fulfil that mandate of the people. We leave the request in your hands with confidence, feeling sure that the House of Commons will grudge no effort and shrink from no sacrifice which the honour of our country and our duty to the Empire demand. I beg now to move the first Resolution, namely, that with regard to the duty on tea.

It is the established Parliamentary practice, sanctioned by the highest financial authority whose weight is acknowledged in all parts of the House, that on this occasion the Committee should not engage in any full and exhaustive criticism or examination of the proposals of the Chancellor of the Exchequer. It is absolutely necessary that the Committee should pass certain resolutions for the purpose of saving the revenue and preventing the forestalment and evasion of the law. In the passing of those resolutions we shall, of course, be disposed to give every facility to Her Majesty's Government, but this is done on the distinct understanding that, by so doing, the House of Commons is not in the least degree committed to any part of the policy espoused by the right hon. Gentleman, and that we shall have a better opportunity on future occasions, when the Bill is before us, for expressing our opinions. I remember that, in October, when the right hon. Gentleman stated the manner in which he was going to deal with the expenditure which had been incurred for the war, I said of him that he had made a speech embodying a great deal of sound doctrine. I think the same thing may be said to-night. The Chancellor of the Exchequer has, in many parts of his speech, given expression, with a fervour and sincerity which showed how deeply he was convinced of their truth, to doctrines which, I am sure, no one on this side of the House or on that, who has studied the great principles which govern our finance, will find fault with for a moment. The right hon. Gentleman will, of course, understand that we cannot but look upon him with a certain degree of doubt owing to certain incidents in his financial history. There are some episodes in the last three or four years of which we have not yet been able to bring ourselves to approve. There was last year the occasion when the Government, with a lack of courage which I think did them very little credit, broke in on the established custom of relieving the burden of debt for very inadequate reasons, and, at the same time, broke in also upon that reserve of strength which was provided precisely, so far as it went, for emergencies such as this. Then we also recall the strange dealings of the right hon. Gentleman with the tobacco duty, which he has acknowledged to-night not to have been altogether successful. Of that I would merely say that it never appeared to have realised any advantage to the consumer, or at all events, if I may use the word in this other sense, the consumer has never been able to realise it in the sense of discovering and appreciating that advantage. Then—I will not renew the old controversy—the right hon. Gentleman, having been provided by the fiscal reforms of my right hon. friend the Member for West Monmouthshire with a bulwark of financial strength such as no Finance Minister has ever had the advantage of before, proceeded to fritter away a large part of that strength by a series of doles to particular classes of the community who certainly were not amongst the most necessitous classes, and has given the money not even to the most necessitous within those classes, and in that way, so far as the money goes, amounting to, I think, about £4,000,000 a year, he has weakened his position for an occasion such as this. But this is not the time to go into these matters. We are very glad indeed to recognise that the right hon. Gentleman has to-night dealt not only in a straightforward but in a statesmanlike and discreet way with the difficulty before him, and with a courage that from his natural temperament we were willing to ascribe to and expect from him. The first great question in a case such as this is what part of this great burden shall be dealt with by way of taxation and what part by way of future obligation in the shape of debt. The right hon. Gentleman has described the different nature of the advice which he has received. He has resisted extreme advice in both directions, and it is my impression that he has made an apportionment which is fair and equitable as between those two methods of dealing with the matter. The right hon. Gentleman has very properly put a considerable part of the expenditure—not very far from the same proportion as was proposed in the case of the Crimean War—upon the shoulders of the taxpayers. I, for one, could never believe for a moment—I would never do my countrymen the discredit and dishonour to believe—that they would shirk an obligation of this kind. We have all been proud of the patriotic spirit exhibited within the last few weeks. If that patriotism is anything but the merest smoke and bluster, surely the British people are willing to bear a burden of this kind to support those whom they have so readily sent to sacrifice their comfort, their safety, and sometimes their lives on the battlefield. There may be, of course, to individuals inconvenience and hardship, and even deprivation, but I do not think that anyone in this House has any fear that the taxpayer will not be ready cheerfully to do his duty. As to the details of the proposals, it will, as I have said, be wiser and more convenient to the House that our opinion should be reserved. I, however, may say, in my particular capacity as a Scotch Member, I think that something will be said as to the increase of the spirit duty from a national point of view on the part of both the Irish and the Scotch. There is a strong belief in Scotland and Ireland, apart from all the financial arguments which may be used by experts in the public offices and in this House, that the taxation put upon the general drink of the masses is heavier by a great deal than that which is laid on the general drink of the English community, and I think they would have been glad if they had been spared somewhat in this respect. I merely forecast that as a line of argument likely to be used in the course of the debates. It is quite understood that the House will at future stages give its decision on each of these proposals. What we must satisfy ourselves of is that the proposals are the least burdensome, the least inconvenient, and the most fair and most advantageous to the Exchequer which can be devised. In giving our assistance to the right hon. Gentleman, and in endeavouring to help him in coming to a conclusion, we shall, at all events, be guided by this feeling—that in hardly any quarter of the House is there any disposition, as the Votes in Supply have already shown, to display any grudging spirit in prosecuting the financial proposals of the Government.

I do not think this occasion should be allowed to pass without some expression of opinion from this quarter of the House. We have now reached a period when the Government of the so-called United Kingdom are obliged to bring in a Budget of over £150,000,000. In other words, we have to find in one year an amount equal to one fourth of the National Debt. At the time the disastrous Union was accomplished the total National Debt of Ireland was under £8,000,000, and now we are asked in one single year to bear a proportion of expenditure amounting to over £150,000,000, in addition to the charge of the ordinary standing National Debt. I wonder what the statesmen who made such promises to Ireland at the time of the Union would have thought if they had been told that 100 years hence this appalling and crushing burden would be placed upon us. I should like to say a word in reference to the unhappy position in which Ireland is situated. The right hon. Gentlemen gave a very glowing account of how England and Scotland are advancing by leaps and bounds; he spoke of there being higher wages, greater prosperity, and larger incomes than ever before. The only industry which had not gained in prosperity was that of agriculture. In other words, the country which alone has not progressed is bound to bear with you pari passu this extravagant expenditure. At the time of the Union we had a number of industries; they have since disappeared. Our country was richer to an enormous degree, both in flocks and herds, as well as in population and purse, than she is now; and yet, whereas your taxable capacity has increased a hundredfold while ours has decreased in a similar degree, we have to bear with you a burden equal to your own. The right hon. Gentleman proceeded calmly to treat the two cases—on the one side a living body and on the other a corpse; he proceeded to administer to them the same physic, and to prescribe the same treatment. One would have thought that, as Minister for this Empire, he would have taken note of the difference between the two countries, and have made some difference in the treatment. Throughout his speech there is not a trace of the necessity for dissimilarity of treatment; there is not a trace of any intention on his part to fulfil the pledges given by the statesmen of the Union to grant Ireland exceptional exemptions and abatements suited to her case and position. Does the right hon. Gentleman think himself an Irish Chancellor of the Exchequer, or does he regard himself as a British Chancellor of the Exchequer? So far as the shepherding of the separate interests of Ireland is concerned, I can see no indication. We are told we have the honour and glory of forming a portion of this Empire. I would like to ask how much of this war expenditure has been spent in Ireland. I will take him upon that issue alone. You have spent upon your exceptional war operations something like £50,000,000, in round figures. Of that amount you have spent about five pence in Ireland. England has benefited by the engagement of ships, the casting of cannon, the making of munitions of war, saddlery, and the thousand and one necessary articles for such an undertaking, but only a few horses have been bought in Ireland, and even those would not have been purchased there if you could have got them cheaper or better elsewhere. Perhaps I am wrong in saying that everything else has been bought in England and Scotland. Of course Germany has not been forgotten; Brazil has not been forgotten; you have bought mules in Brazil. America has not been forgotten; you have bought saddlery there. Austria has not been forgotten; you have obtained underclothing in some of the central European States. What do we gain by the war? Nothing, except that a few Orangemen have desecrated Catholic churches in Belfast and broken the heads of Catholic workmen in Portadown. What do we lose by it? When the legless and armless men of the Dublin Fusiliers return, we shall have to put them up in our workhouses and bear the expense on the local taxation. In Drumcondra alone, a little suburb of Dublin, there are forty widows. In one miserable little street in Dublin, Cook Street, there are eight widows as the result of this war. The wearing of black by the people of the poorer classes is distinctly noticeable in the streets of Dublin. I do not say that you have not done your duty in this respect. I believe you have. It is but fair to admit the magnificent manner in which the aristocracy as well as the working classes have gone to the assistance of their country. But, at all events, you will have the gold mines at the finish; you will have the Transvaal at the end. You will have an asset; what shall we have, except graves and dead? That is our position, to which the right hon. Gentleman in bringing in his £150,000,000 Budget, does not even think it worth his while to make any reference. These facts have not even excited a passing remark upon them. Let me refer to the question of tobacco. If anyone reads the history of Ireland, they will find it stated that between Dublin and the county of Cork, for a distance of 150 miles, heaps of tobacco were being burned in the fields, and tobacco growing was once an important branch of the Irish agricultural industry. Ireland can grow tobacco, and she has grown it successfully in the past; and you have now throughout Ireland a revenue and police system which would give you full warning of smuggling, and by which it would be easy to prevent illicit growth and manufacture of tobacco. While the right hon. Gentleman proposes to enhance the tobacco duty, he does not even suggest the relaxation of the restrictions which would enable the tobacco industry to thrive in Ireland. What he has said is from an English point of view, and I do not suppose any Englishman can fairly complain of the Budget. But the position of Ireland is entirely different. It is said that the burden has been put upon all classes; that incomes have been taxed, as well as the tobacco user and the beer consumer. Even the teetotaler, it is claimed, has not been left out, and accordingly the right hon. Gentleman taxes tea. In other words, the right hon. Gentleman taxes the three great articles consumed by the poor, because a man may drink tea who is also a tobacco smoker and a beer or whisky drinker. The right hon. Gentleman has dived into the pockets of the poor in Ireland. It is not enough for Ireland to have to provide brave soldiers, but the poor have to provide their wages as well out of their poverty. I would make a claim that now, at all events, if he is going to increase the tax upon tobacco, he should take this opportunity of relieving the Irish people from the restrictions on growing tobacco. It is the merest matter of arrangement. In the old days when the tobacco industry flourished there was no such thing as the revenue and police system as it exists at the present moment. The Royal Irish Constabulary had not then been established. Smuggling was rife, and it was impossible to collect the duty. You have in every village in Ireland ten policemen, costing the country, with a sergeant, £1,000 a year; you have a schoolmaster and schoolmistress, costing £150 a year; and you also make us pay a large contribution every year for education—and what do we get out of this glorious system? You say you cannot reduce the number of police, but why not turn them to some good account, and make them do some- thing for their wages? At present they are simply engaged in the collection of rents for landlords, and they take part in an occasional eviction, and in the North of Ireland the police are utilised to prevent Orangemen from shooting down the Catholics. Therefore you have in every village the means of providing that if tobacco is grown the tax upon it shall be fairly paid and assessed. When there was a Vice-Chancellor of Ireland we had somebody to look after Irish industries, but no one seems to care for the interests of Ireland now. Much as I respect the right hon. Gentleman, he has a British skin, and he cannot, therefore, have an Irish heart, but he knows a great deal more about our country than he pretends to do. How is it that he never casts upon that country a pitying glance? If we have to pay this extra tobacco duty the restrictions upon the growth of that article ought to be removed in Ireland. According to the English view, when you put a tax on whisky its fiscal nature disappears, and it assumes a position of benevolence. You tax Irish peasants not to carry on wars, but to prevent them getting drunk; you say it is for our own benefit, for fear we should relapse into the position of the savage. When Mr. Gladstone put the increased tax on whisky the result was that he wiped out seventy distilleries in Ireland. You say it does not matter what taxes you impose on whisky, but there is not one of you will examine the state of things in Ireland and look at it from an Irish point of view. You are all chock full of the war in South Africa, or of your policy in China or Madagascar, and there is hardly a subject which you are not full of. The only thing you care about in Ireland is how much revenue you can get out of her, and Ireland is looked upon solely as a taxable commodity. Your conduct towards Ireland is heartless and callous. This tax upon whisky is undoubtedly an additional burden. There was great laughter when the right hon. Gentleman mentioned gallons instead of barrels in the case of the beer tax, and I suppose if he put one shilling a gallon on beer there would be a revolution in Whitechapel. But when the right hon. Gentleman comes to deal with whisky it is not in barrels he measures at all. He puts only one shilling on thirty-six gallons of beer, but there is to be sixpence put upon each gallon of whisky. I say this war has been got up by Mr. Cecil Rhodes, and the extra taxes should have been put on diamonds. I do not see why stockbrokers should not pay an enormous tax as well as barristers and solicitors. Why not make those pay more who make enormous fortunes on the Stock Exchange? You do not propose that because they are all Tories; and they find that nothing is more delightful than to read in the newspapers, when the news of great victories is to hand, that they have been singing "God save the Queen" on the Stock Exchange. I do not think they would be in such a splendid state of jollification if they had to pay a tax of £500 a year. Irishmen have got both to fight your battles and to pay for them out of their miserable incomes. There is before the House the Tithe Rent-charge Bill for Ireland, by which the landlords are to be relieved to the extent of £50,000 a year in order to enable them to pay their war taxes. For my part I do not at all see the objection to the raising of this large sum by way of a loan. Why should the people of the present time bear all the burden? The people who gain by this war should be the people to pay for it. No doubt the English people would cheerfully provide the taxes for the right hon. Gentleman purely out of public spirit and patriotism. The right hon. Gentleman went on to remark that the colonies were providing enormous sums towards this war, and I should like to know how much they were providing. I read the other day the telegram sent by the Colonial Secretary to Australia asking for more men, and he told them that the Imperial Treasury would pay the bill. Those men have to be paid by the unfortunate people of Ireland, and it is untrue to say that the colonies are paying for this war. They are paying these men 5s. per day. If I had not anything to do myself I should have regarded at one time such an offer and a trip to a foreign country as very satisfactory. It is unfair to suggest that Australia is bearing any of these burdens. And why should not our colonies pay? They are very keen on the war. And why should Canada not contribute, for she gets a great deal of kudos out of it? When the Canadians in battle are praised they are put in the newspapers in big letters, but when the Irish troops score at the front this is not done. [Ministerial cries of "Oh, oh!"] Why not make the Isle of Man and the Channel Islands contribute to this splendid Imperial saturnalia of generosity? The only country which is made to pay is the very one which is protected by treaty from paying. With regard to the income tax, as far as England is concerned, it is a fair item, but is it fair in regard to Ireland? It was understood at the time of the Union that the income tax would not be charged. It was never dreamt of, and we did not pay income tax for fifty years after the Union was established. It was put on as a temporary expedient after the time of the Crimean War, and now, in spite of our protest on this financial question and the finding of the Royal Commission that we are paying £3,000,000 a year too much, you propose to increase our income tax by 4d. in the £. I think that imposition might, at least, be left alone as regards Ireland, whose income is very limited, for there are no large businesses in Ireland. Is it fair to tax limited incomes with no chance of extension in the same way as those enormous incomes in this country? I emphatically protest against this system of taxing Ireland for military purposes, while you keep her hampered and deny her her liberties. We do not desire to go abroad to kill Dutchmen, but we desire to leave them alone in the enjoyment of the country which they have acquired. Having denied us Home Rule, that ought to make you keener and more zealous not to pile upon us those burdens which the denial of Home Rule involves. I beg of you, as fair-minded men, to cast aside political prejudice and to look at the impoverished condition of the Irish people. If you will do so you will see that you ought to arrange your fiscal system so as not to place any additional burden upon the people of Ireland.

I only rise to-night to add my tribute of admiration for the speech the right hon. Gentleman the Chancellor of the Exchequer has addressed to the Committee—a speech, if I may be permitted to say so, distinguished by soundness of financial principles and still more valuable on account of the political courage with which those principles were expressed. It is not the first time I have congratulated the right hon. Gentleman on his financial ability, and I have had also to congratulate him on his financial good fortune in times of peace. He has had the advantage of extremely prosperous times; he has spoken of the great prosperity of the country, and we all join in rejoicing and hope it may be as lasting as it is great. I congratulate the right hon. Gentleman on his courage, but I think he is rather in the position in which Solon found himself when he said—

"I did not always give the best laws, but the best laws the people would bear."

When the right hon. Gentleman referred to history and the courage of our ancestors in respect to taxation, I thought the boldness he had shown was hardly equal to the example. I will not go further back than the Crimean War, but in relation to that war when the question arose of distribution of cost between borrowing and taxation—I have a note here I took from Sir Stafford Northcote's book on financial policy—at the time the accounts were made up, the cost of the war was calculated at £76,400,000. Well, that was a two years war, and we have run up nearly that bill in less than six months, and how much more it will prove of course no man can tell. But, in dealing with that war a generation, I may say two generations ago, out of the £76,000,000, £40,000,000 was raised by additional taxation, or more than half, and £32,000,000 was added to the Debt of the country. These amounts do not make up the total, but at the conclusion of peace the balance was made up by increases in the productiveness of taxes, so that at the end of the war when accounts were made up £40,000,000 had been raised by additional taxation and £32,000,000 only was added to the Debt. I adhere so completely to the principles which the right hon. Gentleman has stated that I do not wish to be captious in my criticisms, but there is one very interesting question upon which I should be extremely glad to have some further information from the right hon. Gentleman. I observed a passage in his speech which was received with considerable approbation, not only from this side of the House, but from the opposite side also; and it was that the Transvaal ultimately was to pay for the cost of the war. I should very much like to know how he expects to get the money? We know that we are waging this war partly in order that Johannesburg should be a self-governing and self-taxing community. I presume after this war has been brought to a successful issue Johannesburg in some form or other will tax itself. But then we have the prospect that these millionaires—Mr. Beit, Mr. Rhodes, and others—will have the taxation of the Transvaal at their own disposal. [The CHANCELLOR of the EXCHEQUER dissented.] Ah! that is exactly what I want to hear. That is the point on which I should like some fuller explanation from the right hon. Gentleman. They will say, "We are fighting for liberty, for self-government; you are never going to oppress the people of Johannesburg by centralised taxation dictated from England? We are a free and independent community, who are to tax ourselves." We know the political and economical creed and the principles of patriotism which are professed by the ruling spirits and the governing classes of the future Johannesburg. To them the British flag is not emancipation, it is not freedom; no, it is a "commercial asset." But I should like to know the principles of finance of the persons who regard the British flag as a commercial asset, and it would interest the country very much to be informed how we are going to get at the money in the reformed Transvaal. We had one of these financial statements the other day, I think from Mr. Robinson; and he calculated that the result of the war would be to increase the value of the ore from 6s. or 8s. to 10s. a ton, and that the war would work out to an advantage of between £3,000,000 and £4,000,000. These are the golden prospects he held out to his shareholders. That sum would be extremely useful to the taxpayers of this country. I do not ask the right hon. Gentleman to reveal his secrets to-night; but when we are taxing the people of this country, and adding many millions to the National Debt with the vague and misty expectation that those gentlemen who are going to put millions into their pockets as the result of the war, will contribute their proper proportion to that expenditure that is a point on which, I think, the taxpayers of the country would like to be informed. I confess that I do not expect much from the munificence or generosity of these gentlemen. Is the Transvaal hereafter going to be a free, independent community to tax itself? In these circumstances I do not think you would get the money. But if it is going to be, as some people desire it to be, a Crown colony, how are you going to get the money then? You will, I suppose, have a council or some other body with power to tax that community. You generally pay the Crown colony the compliment of allowing it to elect part of that council. But there are colonies where it is necessary always to keep in your hands a majority of nominated members. Just conceive the future of this emancipated Johannesburg with a majority of nominated members taxing according to the views of Downing Street, and not of Johannesburg! That is one view. Before we impose all these burdens, whether by borrowing or by taxation, we should take some security for getting a charge on these funds which would relieve the taxpayers of Great Britain. I hope, therefore, either now or at some future stage of these financial discussions, we shall have some security by some sort of arrangement. I do not think it would be impossible, and if secured there will be very great satisfaction in the country generally. I entirely support the general principles of finance as stated by the right hon. Gentleman. Of course, we reserve to ourselves the right on a future occasion to discuss the details and the application of these principles.

I think the right hon. Gentleman is premature in requiring the Chancellor of the Exchequer to impose a charge upon the Transvaal at this moment. We have not captured the Transvaal yet, neither have we any authority there. When we have it will be time enough—

It may be too late.

If you want apples you go to an orchard, and if you want gold you cannot go to a better place than to a gold mine. I, of course, anticipate that there will be the greatest readiness on the part of the millionaires, who have incurred a debt to this country by being released from the grinding tyranny of the Transvaal, to contribute to the expenses of the war. They were subjected to a financial tyranny, which, perhaps, is the tyranny of all others which millionaires would be most anxious to be relieved of. I have no doubt that means will be found, if we do get to Pretoria, to levy a contribution on the millionaires referred to by the right hon. Gentleman. I observe that the Chancellor of the Exchequer displays a great want of imagination in his Budgets—especially in this Budget. He has kept to the old ground, and has invented nothing new. Last year I suggested to the right hon. Gentleman a tax on diamonds. We import 4½ millions worth of diamonds every year from one of the places which should be most grateful to us for being rescued from the rule of the Boers. That release has been effected through Her Majesty's Government, and I think it is well worth the consideration of the Chancellor of the Exchequer whether instead of taxing tobacco 300 per cent. and tea 60 per cent., and making the general average of the duty on four or five articles 100 per cent., he should not tax diamonds at something like 100 per cent. also. That would give him £4,500,000, in addition to which there could be a licence for sale and, indeed, a licence for wear. The officials of the Treasury, to whose ability—especially the ability of the Chancellor of the Exchequer—the Prime Minister testified in another place, should have no difficulty whatever in getting an adequate tax out of diamonds. The only general remark I desire to make is that, although the Chancellor of the Exchequer and every other financier have constantly denounced our fiscal system as being extremely unsound, the right hon. Gentleman has at this moment of extremity adopted and intensified all the unsoundness of that system. Complaint has been made by the First Lord of the Admiralty, by the First Lord of the Treasury, and by the Chancellor of the Exchequer himself that the objects of taxation in articles of consumption are much too few, but the right hon. Gentleman has kept them as few as they were, and has largely increased the duty upon them. I think this is very unfortunate. It has also been pointed out again and again that the exemptions and abatements in connection with direct taxation are very much abused, and are more than they ought to be. The right hon. Gentleman has kept on all the abatements, while increasing the income tax by 50 per cent. The First Lord of the Treasury has pointed out that although the total income of this country is 1,500 millions, only 700 millions are assessed, but instead of getting income tax either from the 1,500 millions or the 700 millions, it is taken only from incomes which are over £160 a year. But even as it is the exemptions and abatements are such that instead of getting 40 millions the Chancellor of the Exchequer only gets 25 millions. These abatements and exemptions ought not to be given, because if an abatement is given to one man another man has to be taxed for it. If there is to be any such thing at all it ought to be by annual grant of this House, which would be considered every year, and renewed or not renewed as the case might be. Then the right hon. Gentleman extends abatements to a man with £700 a year. He is not a poor man; he is well able to maintain his station in life without any outside assistance, and he ought to pay his small and infinitesimal share of the income tax as well as anyone else. I quite understand that a man with £100 a year should get a special exemption, but if a man with £1,000 a year is now required to pay 1s. income tax the man with £700 a year ought to be required to pay it also. If not, the latter is paying less than his share and the former more, and every addition to the income tax intensifies the inequality. The right hon. Gentleman objects to diamonds. Will he take furs or feathers or musical instruments? I have made out an interesting list which shows that we import lace to the value of 1½millions, embroidery one million, artificial flowers £600,000, feathers 1¼ millions, musical instruments, including, I suppose, the instruments brought over by the German bands, £1,100,000, and diamonds 4¼ millions. These give a total of £11,000,000, which altogether escape taxation. If a customs duty were put on them on the same scale as on spirits, tea, tobacco, and wine, they would realise £11,000,000 of revenue. I regret that the right hon. Gentleman has completely abandoned the principles of the First Lord of the Treasury and himself, and has given the go-by to what he told us a few years ago was a pressing necessity, namely, to find further sources of taxation. I have presented him with half a dozen sources, and I hope he will consider them. The right hon. Gentleman, of course, has had an enormously increased expenditure to meet. I have made a calculation whereby I find that if he had been able to adhere to the precedent of the right hon. Gentleman the Member for West Monmouthshire, and not have allowed the expenditure to exceed the Estimates, the country would have saved £100,000,000. It has fallen to his unhappy lot since 1896 to have added the sum of not less than £100,000,000 to taxation. I do not say it is his fault; but he has colleagues. As to the very large decrease in expenditure as compared with the Estimates, I do hope that the right hon. Gentleman will not plume himself on that fact. A surplus of £5,000,000 over the Estimates is only a mistake of £5,000,000. So long as that is understood, and credit is not taken for it, I will pass away from it. What I wish to point out is that £2,000,000 out of that £5,000,000 come from the death duties. It is entirely due to the right hon. Gentleman opposite that it has become absolutely impossible to calculate the returns from the death duties. The result is that the Chancellor of the Exchequer has never made a mistake of less than a million, and this year he has made a mistake of two millions.

Always in excess.

What does that matter? The effect is that the Chancellor of the Exchequer has been given a million or two to divert from ordinary courses. He has always used his surpluses for his own purposes. Previous to the Finance Act of 1894 no duties were calculated with more certainty than the death duties, but after the extraordinary graduations introduced by that Act it is now impossible to estimate them with precision. The death duties amounted to 17½ millions this year, but if the old system had remained they would have amounted to 15 millions, and be on a much sounder foundation and be capable of being accurately estimated. Therefore I do not think that the increase in the death duties is entirely a matter for approval. They are now more uncertain than they were formerly. With reference to the loan which the right hon. Gentleman proposes, whether it should be terminable in ten years or whether it should be added to the permanent debt depends on the purpose to which it is to be put. I do not know what he may have in his mind, but evidently we are to give him carte blanche. I suspect he is going to offer some inducements to the people in the Savings Bank to take some of it. I do not know, but I presume we shall all be asked to take shares in it. I think, however, that the purpose to which this loan is to be put is of the most permanent character. If we fail in the South African campaign, we will not only lose South Africa, but we will certainly, or probably, lose India; we shall imperil the whole of the Empire, and bring these islands themselves into increased danger. On the other hand, if we succeed, we will avoid all that risk, and we will endow posterity with an increased Empire on a more solid foundation. If that be so, posterity should bear its share. If it be that we are about to do a permanent work in South Africa, not for South Africa alone, but also for the Empire and for these islands, surely it is not right to expect us to pay in ten years a loan contracted in order to give a permanent benefit to posterity. I think that the argument for making the loan a permanent addition to the debt from that point of view is very strong. If, on the other hand, instead of improving the position of the Empire we make it worse, then we ought to pay. But assuming, as I do, that we are certain to achieve great benefits for posterity, posterity should pay its share. This is a very severe Budget. The taxpayer will severely feel it, not only the income-tax payer, but also the consumer of dutiable commodities. As to income-tax, I entirely fail to see why a man with an income of over £700 a year has to pay the entire tax, whereas a man with an income under that amount gets an exemption. It is unfortunate that this large addition should be made to the income tax without making any attempt to remove the inequalities caused by the abatements and exemptions which apply to it. My objection to the Budget is not one of principle, so much as that it leaves the imperfections of our fiscal system where they are, and intensifies them to a very considerable extent. With regard to the loan, I am not at all clear that instead of being a loan for a temporary period it ought not to be permanently added to the Debt.

I wish humbly to join with the right hon. Gentlemen and hon. Gentlemen who have congratulated the Chancellor of the Exchequer on a thoroughly straight- forward, courageous, and sound Budget. He has had at least as much applause from this side of the House as he has had from his own side. Whatever may be the supposed divisions in the Liberal Opposition, we shall all unite in praising the Chancellor of the Exchequer. There are one or two points in connection with the Budget on which I would wish to say something. I am wholly unable to agree with my hon. friend opposite in his proposition that the loan to be raised should be a permanent addition to the debt. I do not take up that ground on the footing that the benefits from this war will be merely temporary. No doubt the war will very much strengthen our position at the Cape, and if the objects of the war are realised it will confer a permanent benefit on the Empire, but I feel very much that we ought to be reducing, not increasing, the National Debt. The National Debt constitutes our war chest, and is the one way by which we can put the Empire into a position of permanent defence. That brings me to the question of the way in which the Chancellor of the Exchequer is going to treat the Sinking Fund. I entirely agree that it would be absurd to pay off with one hand when we are borrowing with the other. The ground which the Chancellor of the Exchequer took last year for the suspension of the Sinking Fund was that it was wasteful to go on redeeming Consols at a large premium. But they are not at a great premium now, and it is probable they will go down further, because the Chancellor of the Exchequer is about to put thirty-five millions of comparatively short securities on the market, with the result that holders of Consols will sell in order to buy the new securities. In that state of things I should have thought that of all times when the purchase of Consols was convenient and useful for the purposes of the Sinking Fund this was the very best opportunity. It is not a case of redeeming them at 111, but at 101, or maybe, less. I am certain the Chancellor of the Exchequer considered this very carefully, and no doubt he thinks that in the main he is taking the best course, but I should like to be satisfied that it would not have been a better course to have borrowed more largely on these new short securities, the shortness of which is likely to keep them from going to a premium, and purchased Consols at their present low rate. One thing I was very glad to hear, and that is that the Chancellor of the Exchequer intends to take the issue of those new securities into his own hands. We have too much experience of loans issued by the nation getting into the hands of contractors, who speedily realise the premiums which should belong to the nation. The Chancellor of the Exchequer has shown great wisdom in taking the rather unusual course of keeping the issue in his own hands, and I hope he will be rewarded by securing for the nation a full premium. The real interest in this Budget will arise when we know the period within which this loan is to be redeemed. I infer it is to be redeemed within ten years; I hope a good deal within ten years. Of course, the Chancellor of the Exchequer says it would be premature to announce the determination of the Government in regard to the period of the redemption before the conclusion of the war; but if he takes that course he will have added another feature to the courageous and straightforward policy which characterises this Budget. There will be a permanent advantage in this. It is right that posterity should pay something, but I look upon the policy of reducing the National Debt as the true source of our material strength in the future. I hope, therefore, that the Chancellor of the Exchequer, in addition to taking the step of laying a large part of the cost of war on taxation, will still further reassure the Committee by announcing his determination to pay off the new loan within a comparatively short time. I am not in the position to weigh the matter with the expert knowledge he has, but it seems to me he has come to a sound decision in issuing the new loan in the form of short securities which will not go to a large premium; and it will put his successor in a position of much greater strength than if a different course had been taken. On the whole hon. Members ought to congratulate themselves in the course the Government have adopted; and the country is under a debt of gratitude to the Chancellor of the Exchequer for the straightforward and courageous way in which he has faced the financial emergency.

I have listened with great interest to the clear statement of the Chancellor of the Exchequer, and I must express my admiration for the firmness of his finance. I think the way in which the country will take his Budget proposals will depend a good deal on their knowledge of what will be the full result of the issue of the short loans. There is no doubt that the feeling of the country is very strongly in favour of the Transvaal being made to pay, after the war is brought to a successful conclusion, for what it has cost this country. If the country has that assurance, it will produce a great effect. When the Transvaal was taken over by this country in 1877, there was half a crown in the Treasury. When it was handed back, the income was £200,000; while the last return of the Transvaal Government showed a Budget of nearly five millions of money. It has been stated by many Uitlanders, who know very well what they are saying, that they paid no less than 89 per cent. of the taxes of the Transvaal; but suppose they only paid 80 per cent., that would have amounted to four millions a year paid by the Uitlanders. We know what was done with that money. Mr. Kruger and his oligarchy devoted what they did not take for themselves to the purchase of guns, ammunition, and all warlike stores, to be used against this country. Now, when we have freed the Transvaal from the Boer tyranny, that money will be free for more legitimate purposes. We have heard that it is our intention to bring this war to a definite conclusion, we don't care at what cost; and therefore I do think that the country has a right to know that the Chancellor of the Exchequer, in taking these short loans, intends that they shall be redeemed from the resources of the Transvaal. If we take a loan of fifty millions and put it into a sinking fund for fifty years at 3½ per cent., the amount that would have to be paid by the Transvaal would be £1,045,000 a year. I was talking the other day to one of the African millionaires, and he said to me—

"We shall be only too happy if you tax us for a short number of years, to enable the cost of the war to be liquidated. We should be only too glad to pay for the feeling of security and justice which we should enjoy under the British Government, but which we never felt under President Kruger and his oligarchy. We never knew what would happen to us; what would be commandeered, or what new monopolies for dynamite and what railway scandals would be perpetrated by the Hol- landers. We are willing to pay if we only get justice, and know where we are."

I think it will be found when we have conquered that country, and when we make our reforms, that we have a perfect right to place taxes upon it for a certain time, sufficient to pay the cost of the war—a cost which ought certainly not to be paid by the people of this country. We pay enough in the lives we have lost. That cannot be repaired; but there is no reason why the money should go into the pockets of the millionaires. That point is one which I think will very much strengthen the feeling of the country in regard to the Budget.

I would be very grateful to the right hon. Gentleman the Chancellor of the Exchequer if he would kindly give to the House a little more explanation in regard to the stamps which it is his intention to impose on contracts other than those entered into on the Stock Exchange. Does he propose to levy these contract stamps also on contracts entered into on the Corn Exchange, the Iron Exchange, the Coal Exchange, or the Cotton Exchange?

No; only brokers' contract notes of the same description as brokers' contract notes on the Stock Exchange.

I do not know whether that covers ordinary trade contracts.

Oh, no.

If the stamp duties are not to be levied on trade contracts, I have nothing more to say on that point. I trust that the Chancellor of the Exchequer is not receding from the firm and sound principle which he announced last autumn, that the gold mines of the Transvaal should pay a fair share of the cost of the campaign.^* I was rather afraid, from his observation that there would be very heavy charges to be paid for compensation in Natal and the Cape, and that they would have the effect of increasing the burdens on the mines, that he was modifying his opinion, and that he did not now consider that the mines could pay the large contributions at first expected for

^*See The Parliamentary Debates [Fourth Series], Vol. lxxvii, p. 515–16.

the cost of the war. I trust, however, that the owners of these mines will not escape from any fair obligations which can clearly be shown to be their due, because undoubtedly the value of their properties will be largely enhanced as the result of a successful campaign. I cannot agree with the hon. Member for King's Lynn in his regret that there should be abatements and exemptions in the income-tax in regard to certain incomes. I understand the hon. Member is against the principle of the graduation of the income tax; but, for my part, I am heartily in favour of it, so far as it can be carried out, and indeed I would do what I could to extend the principle further. I should have been glad if the Chancellor of the Exchequer could have seen his way to exempt incomes of £700 and under from the increased taxation. Nor can I share the regret expressed by the hon. Member for Louth that Irishmen are, as he said, to be taxed so much more than Englishmen on their national drink. The hon. Member protested that for every gallon of whisky an Irishman drank he would be called upon to pay 6d. extra, whereas an Englishman would have to drink eighteen gallons of beer to pay the same sum. But I presume that an Irishman does not always drink his whisky neat, and if he dilutes it with sufficient water the duty on the whisky would not work out at a very much heavier ratio of taxation in proportion to the amount of liquid imbibed than in the case of the Englishman's beer. I think that in view of the very serious deficit of thirty-seven millions, the Chancellor of the Exchequer must now regret that a year ago he did anything to tamper with the Sinking Fund, for if he had not so tampered with it, he would have found that his present financial position would have been stronger than it is.

I wish to give expression to the feeling of satisfaction with which I listened to the statement of the right hon. the Chancellor of the Exchequer, as to the mode in which he proposes to raise the large sum he requires. The course he intends to take in the issue of terminable bonds is a wise one, and must commend itself to every business mind. It will be not only economical but sound finance. If issued in the form of Consols, in times of pressure the necessity for the redemption of the debt now in- curred might be overlooked, but the redemption of these securities must be provided for, because of the fact of the date of their redemption being stamped on the face of them. One remark of the right hon. Gentleman gave me a great deal of pleasure, namely, that he did not propose to adopt the common course of issuing these securities—whatever form they may ultimately assume—by tender, but to issue them at a fixed price to the general public, so that both the small and large investor may be able to acquire them on the same terms. If that is done I feel sure that the response will be very large indeed. For these reasons I beg to assure the right hon. Gentleman that, so far as I know, the commercial community will hail with acclamation the proposals he has brought before the House this evening.

I am glad to know that to-night the Chancellor of the Exchequer recognises the errors of his ways in his Budgets of the past two years. If the right hon. Gentleman happens to remember—which I cannot hope that he did in the case of so humble an individual as myself—[Sir MICHAEL HICKS BEACH: I do.]—then I feel highly honoured—I pointed out at the time that there would be no benefit from the reduction in the tobacco duty to the half-ounce man; that unless the Chancellor took £2,000,000 off, instead of £1,000,000, the amount would, be so lost in the transfer of business that the poor man would get no benefit from it whatever. I was quite prepared for the Chancellor of the Exchequer reimposing that duty, though I do not agree with it. On the whole the Budget comes up to what was generally expected by those who take an interest in taxation. But I do wish that the Chancellor of the Exchequer, with the many great abilities which we all admit he possesses in financial matters, would consider the readjustment of the tobacco, duty. The man who at present pays 4s. a pound for his tobacco will have to pay this increased tax of 4d. in the pound just the same as the man who pays 10s. a pound. The Chancellor of the Exchequer will see how very unjustly the burden of that taxation falls on different classes. The man who pays 10s. a pound for his tobacco could very well afford to pay the extra 4d. of duty, or, indeed, an extra 1s.; it would not hurt him, because he must be a man of substance and large income; but it is an unjust allotment of taxation to compel the poor labouring man with only 12s. a week wages to pay the same increase in taxation on his cheap tobacco—which has become almost a necessary of life—as the rich man on his 10s. a pound tobacco. In the case of the income tax the present Chancellor of the Exchequer has done some good service in further scaling that burden. Now, why should he not scale the burden in the case of tobacco? I think I have made my case clear to the Chancellor of the Exchequer, and I hope that if he cannot do it in this Budget he will give us a promise that he will examine into the matter. It will be remembered that on a previous Budget I voted for a further reduction of the tea duty. Now, that tax is to be increased 50 per cent., and the poor labouring community, both in the towns and rural districts, will pay as much per pound for their common tea as the rich man pays for tea carefully selected and specially picked for his consumption. Although the Chancellor of the Exchequer does not drink tea, he must know that there is an enormous difference between the pleasure obtained in drinking common tea and in drinking the best tea. Now, why should the agricultural labourer on twelve shillings a week pay exactly the same sum to the revenue per pound for his common tea as the man who has an income of £1,000 a year, and can well afford to pay a large price for his high-class tea? It is monstrous, because in many cases tea is the only drink, especially of our peasants and agricultural labourers. I was delighted to hear the appeal which the hon. Baronet the Member for the Uxbridge Division made to his own party and to the Government to see that, while the country intended to continue this war to a successful issue, we should not have to bear the cost of it, not only in the slaughter of our fellow countrymen, but in gold in addition. That is an appeal which will reach the hearts of all classes, whether they are in favour of the war or against it. I was pleased to hear that declaration, because it gives me the opportunity of appealing to the Chancellor of the Exchequer to see that the poor people are not taxed to the same extent as the rich for their tea and tobacco, which are now distinct necessaries of their existence. The Chancellor of the Exchequer had a melancholy duty to perform to-night in announcing the large cost of the war, and the necessity of providing for it in these times of marvellous increase of revenue. He discharged that duty with marked success, and with satisfaction to those who sit opposite him, although I noticed a marked silence prevailing on many benches behind him. I regret the cause of this vastly increased expenditure; but our house, so to speak, is on fire, and the Chancellor of the Exchequer must have the necessary materials to put the fire out, which we hope he will be able to do as soon as possible, and return to the ways of his youth. In the meantime, I do appeal to the right hon. Gentleman to give us some hope that he will entertain the subject I have put before him.