To ask the Secretary to the Treasury, as representing the Postmaster General, whether he can state in what condition is the existing contract, if any, for the carrying of His Majesty's mails from Limerick Junction through the districts of Limerick and County Kerry; and whether it is the intention of the Government to carry the mails by car instead of by rail as heretofore. (Answer.) No alteration has been made in the mail service between Limerick Junction and Limerick. The contract for the mail service on the Kerry line has been terminated by notice from the railway company, who have demanded such a large increase for the maintenance of the present trains that the Postmaster General had no alternative but to acquiesce in the modifications of the service which have been arranged by the company. This will necessitate the conveyance of the mails in certain cases by car instead of by railway.—(Post Office.)

To ask the Lord Advocate whether the recently-appointed medical officer of health for the county of Caithness is the holder of a diploma in sanitary science, public health, or state medicine under Section 21 of the, Medical Act, 1886. (Answer.) I am informed by the Local Government Board that Dr. Dick is registered under Section 21 of the Medical Act, 1886, as holder of the Edinburgh University diploma of B.Sc. (Public Health).—(Scottish Office.)

To ask the Lord Advocate if he will state the number of interments which took place in each of the six crofting counties last year without the production of a medical certificate of death. (Answer.) On the 26th April, 1901, in reply to a similar Question, I pointed out to the hon. Member that a medical certificate of death is not a necessary condition of burial in any part of Scotland. There is no information in the Registrar's Office as to the number of interments without the production of a medical certificate.—(Scottish Office.)

To ask the President of the Board of Trade whether he will publish the Reports of the British delegates sent to the Stockholm and Christiania Conference on North Sea Fishery Investigations, and the correspondence bearing on these Reports between His Majesty's Government and the various Continental Governments concerned; if he can state the cost of the investigations which are to be undertaken, and the proportion which will be borne by the several Governments. (Answer.) I will consider whether any of the Reports referred to can properly be published, and I will communicate with the hon. Member on the subject. The amount proposed to be expended in three years by Great Britain on fishery investigations, including the share of the cost of the central bureau, is £42,000, but I have no information as to the amount proposed to be expended by other countries.—(Board of Trade.)

To ask the President of the Board of Trade whether it is his intention to introduce a Light Railways Bill during the present session; and, if so, when. (Answer.) A Bill is in draft, but I am not yet in a position to say whether it will be possible to introduce it this session.—(Board of Trade.)

To ask the Secretary of State for the Home Department whether there is any distinction in the treatment in convict and local prisons between soldiers sentenced to penal servitude for military offences and criminals sentenced by a civil court for the worst offences. (Answer.) The rules for carrying out sentences of penal servitude do not differentiate between different classes of convicts except in so far as a convict may be placed in the star class.—(Home Office.)

To ask the Secretary of State for India whether, seeing that during the past financial year an unusual amount of silver was purchased by the Indian. Government, whether he can state the exact sum so purchased; and, having regard to the fact that during the present financial year no silver was bought, whether he will consider the advisability of adopting a policy which will prevent any disturbance of the world's silver market and the exchange currency of Asia. (Answer.) 1. The amount paid for the purchase of silver during the past financial, year was £2,885; but the hon. Member's Question is probably intended to refer to the year 1900–1, when silver was bought in England for the Government of India to the value of £5,649,924, besides about £400,000 bought in India. 2. The Government cannot undertake to buy silver for the coinage of rupees except when there is reason to believe that such coinage will soon be needed in India.—(India Office.)

To ask the Secretary of State for India, in view of the fact that the hospital for the native troops at Lucknow is unprovided with a ward or room of any kind for serious ophthalmic or other cases of a special character, will he take such steps as may be necessary to ensure the provision of suitable accommodation for such cases. (Answer.) I have no special information as to the details of the accommodation provided at this hospital, but I am confident that the matter may safely be left to the discretion of the Government of India, who, aided by their professional advisers, are always anxious to make the best arrangements that are practicable for the treatment of soldiers who are on the sick list or in hospital.—(India Office.)

To ask the Secretary of State for India whether he is aware that reporters are excluded from all meetings of the Darjeeling Municipal Council unless they are ratepayers; and will he cause inquiry to be made into the matter. (Answer.) I have no special information on the subject to which the hon. Member refers; but the law requires that the minute book of the Municipal Council shall be open to the inspection of ratepayers. I have no doubt but that this provision is complied with, and I do not propose to interfere with the discretion of the local Government as regards the class of reporters to be admitted.—(India Office.)

To ask the Under Secretary of State for Foreign Affairs whether his attention has been called to recent appointments to missions abroad of persons not belonging to the regular diplomatic service; whether, with the view of preventing discouragement to men who have little interest, but who have given good service in distant quarters of the world, and stagnation in the ranks, he will, in the event of any immediate vacancy occurring at a secondary European post, give an assurance that the claims of members of the diplomatic service will be kept in view. (Answer.) The claims of members of the diplomatic service are always con sidered when selections are made for appointment to missions abroad, but in the exercise of the discretion which is reserved to him under the regulations for the diplomatic service, the' Secretary of State cannot agree to any limitation which might prevent him from making such recommendations as may seem to him best for the public interest.—(Foreign Office.)

To ask the Vice-President of the Committee of Council on Education whether he will explain why Schedule VII. (Rules for Building), in the table of contents of the Code of Regulations for day schools, which is stated to be found on page 56, has been omitted; and if such omission is accidental, or has been decided upon by the Education Office. (Answer.) I answered this Question on 8th May last as follows:—" It was considered by the Board of Education that building regulations did not properly form part of the Code, and such regulations will be issued shortly as a separate Paper."—(Board of Education.)

To ask the President of the Local Government Board if he is aware that it is proposed to build a new workhouse for the Tetbury Union; and if he will consider the desirability of incorporating the Wiltshire parishes of the union with the Malmesbury Union in that county, and of Gloucestershire parishes with other Gloucestershire unions, so as to avoid the expense of building a new workhouse; and if he will state the average number of indoor poor in the Tetbury Union during the past three years; the present rateable value, and the population by the census of 1901; and the estimated cost of the new workhouse. (Answer.) For many years the workhouse of the Tetbury Union has been unsatisfactory, and the guardians have from time to time had before them the question of building a new one. On the 6th March last the Local Government Board wrote to the guardians, referring to objections to the present building, particularly as regards the risk from fire, and urged them again to consider seriously the whole subject. No communication has since been received from the guardians. I should be willing to consider any application which might be made with regard to the dissolution of the union, but I am informed that the guardians are opposed to any such proposal. During the past three years the mean number of indoor paupers, including vagrants, was forty-seven, forty-three, and forty-seven respectively. The rateable value of the union at Lady Day, 1901, was £31,117, and the population, according to the last census, 6,146. I am not in a position to say what would be the cost of building a new workhouse, but I am informed that it has been estimated at £15,000.—(Loral Government Board.)

To ask Mr. Attorney General for Ireland, having regard to the fact that a portion of the Enniskillen Union is in the county of Cavan, and that it would be a convenience for the tenants who have land cases for hearing before the Chief Commission if cases from Enniskillen Union were put in the County Fermanagh list for hearing at Enniskillen instead of at Cavan, whether he will communicate with the Irish Land Commission with the view of having the hearing of these cases so arranged. (Answer.) Seven cases from the County Cavan portion of the Enniskillen Union will be heard at Cavan on the 17th of June. It is usual for cases of holdings situated in the county of Cavan to be heard at Cavan; but if the parties desire that these cases should be held over until the next sitting of the Land Commission for the hearing of appeals at Enniskillen, they should make such application as they may be advised to the Court, and the Court will decide the matter according to what they consider to be the most convenient course.—(Irish Office.)

To ask the Secretary of State for War whether the specification, in the Army contracts for Bermuda, that bread shall be made of the best American white flour implies that it shall be of flour produced in the United States of America only, or whether flour produced in British America would be accepted; and, if British American (Canadian) flour is not admissible, will he state by whoso orders a discrimination was made in the Army contracts against the products of the British dominions and in favour of foreign products. (Answer.) The existing contract is for flour produced in the United States; the contract was made with the approval of the War Office. The House has been already informed that for future contracts the question of widening the specification for bread is under consideration. I may add that Canadian flour is dearer than that from the United States.—(War Office.)

To ask the Secretary of State for War whether, in addition to the twenty-five officers and men from each Volunteer battalion that will be present at the Coronation procession on the 27th June, he will arrange that a certain proportion of Volunteers from each corps who served in South Africa should also be present. (Answer.) There is no space available for any more men, but there seems no reason to suppose that commanding officers of Volunteer corps will fail to secure the attendance of men who served in South Africa.—(War Office.)

To ask the First Lord of the Treasury whether that part of the income of the endowment known as Harper's Charity which at present is expended upon public elementary schools in Bedford, can, under the Education Bill, be hereafter similarly applied. (Answer.) The answer is in the affirmative.—(Treasury.)

As a matter affecting the privileges of the House, I beg to bring to your notice, Sir, certain statements in the Daily Mail, accusing the Secretary to the Admiralty, as a Minister of the Crown and a Member of the House of Commons, of falsehood in a statement made by him in the House. I propose that the clerk should read those statements, and then I will, subject to your consent, move that they constitute a breach of the privileges of the House.

What is the date?

The date is May 6th. If any question should arise about the lapse of time, I shall be able to satisfy you, I think, that I have taken the first available opportunity in the circumstances.

I do not think that that is sufficient. If the hon. Member has anything to say about the date, he had better say it now. The Rule of the House is that a breach of privilege of this kind must be taken notice of at once. If it is a breach of privilege, it is a breach of privilege on the face of it, and it does not depend on subsequent events to justify its being brought before the House.

I will read the passage complained of first, and I will then explain why I did not bring up the matter before. The Daily Mail wrote in regard to an answer given in the House—

If that is the hon. Member's case, I am quite against him. It is quite clear that the breach of privilege, if breach of privilege there was, was complete on May 6th, and it is not for the hon. Member to enter into correspondence with some Minister, for whom he is apparently taking up the cudgels, and then, when he finds that the Minister himself does not propose to treat the matter as a breach of privilege, to say he will himself take it up a week or ten days afterwards, instead of raising the question at the first available moment.

I undertook to raise the question on the first available opportunity.

I understand, Sir, that your ruling is that the hon. Member is not in order; but I should exceedingly regret if your ruling were to preclude me, after the allusions made to me in this House, from offering to the House a personal explanation.

The hon. Gentleman is quite in order in making a personal explanation.

I do not know that I particularly object to the hon. Member for South Donegal coming forward as the champion of my honour.

Oh, no, excuse me. On a point of order, I will not allow that to pass for one moment. I am not the champion of the hon. Gentleman's honour.

That is not a point of order. The hon. Member must not interrupt.

Perhaps I may be allowed to continue, and say that I am exceedingly grateful to the hon. Gentleman for directly or indirectly giving me an opportunity of making a statement in regard to this matter, which, I confess, to my mind has an exaggerated importance in the minds of some Members of this House. I will make a short statement of the whole of this transaction as far as it concerns myself. The facts are these. On 21st June, last year, a letter from Lord Charles Beresford, now Member for Woolwich, appeared in one of the daily papers in regard to the Mediterranean fleet. A Question was put to me in the House, as the representative of the Admiralty, on June 24th, and in answer to that I stated, what appeared to be the fact—

"There is nothing to show that the letter was intended for publication, and it seems highly improbable that the Rear-Admiral would have taken a step so contrary to the discipline of the Navy as to make a public communication with regard to confidential reports transmitted by him in respect of the fleet in which he was serving."

On the following day Mr. Arnold White, the gentleman whose name has been introduced into this matter, wrote to me as follows:—

"I was sitting under the gallery of the House of Commons yesterday when you said, in reply to Mr. Norman's Question, that there was nothing in Lord Charles Beresford's letter to show that it was intended for publication, and it seemed highly improbable that the Rear-Admiral would take a step so contrary to the discipline of the Navy and would make public matter in regard to confidential reports transmitted by him in respect of the Fleet in which he was serving. It will be no surprise to you to know that I was the recipient of that letter, and am responsible for its publication."

That was the letter sent to me by Mr. Arnold White, with whom I have always been on most excellent terms, and it contained other matter of interest to us both. I replied on June 27th:—

"I am not surprised to know that Lord Charles's letter was sent to you. Indeed, I supposed that was the case. Whether or not he instructed you to publish it I do not know, nor do I ask. As for any steps you yourself think it right to take, that, of course, is not a matter with which I have anything to do. About the other matter with which I am concerned, I must say frankly that I have no doubt whatever as to what is right. The rights and duties of a private individual depend very largely upon the conscience and sense of duty of the individual, but the rights and duties of an officer holding a high command are, as long as he holds that command, strictly limited by the rules of the service and by the discipline which applies to every officer and man in the force alike. Granting that I were to agree with every word Lord Charles says, I should still feel that he was and must be wrong, while his flag is flying, to set an example which he would be the first to condemn if followed by any officers under his command."

I said to Mr. Arnold White then what was in my mind: that I did not understand—I do not quite understand now—what the relations were between that gentleman and the noble Lord, but I said that I waited for the course which he thought fit to pursue. On July 6th Mr. Arnold White did take action, and published his letter to me in The Times. This letter contained the statement that he was the recipient of the letter, and was responsible for its publication. It seemed to me then, and seems to me still, that that was a public and direct acceptance by Mr. Arnold White of responsibility for a matter for which primarily the noble Lord would be responsible. A Question was put to me in regard to the matter in the House on July 9th. I replied as follows:—

"The Admiralty understand that the letter referred to by the hon. Member was a private letter, written without any idea of its being published, and that its publication was unauthorised. In these circumstances it has not been thought necessary to call upon the Rear-Admiral for an explanation."

I added, in answer to a further Question—

"We are informed that it was published on the sole authority of Mr. White."

I admit that this was an inference, but I submit that it was a reasonable inference, and it was certainly made in perfect good faith. I submit that it was reasonable, because in the first place it seemed to me to be the obvious construction and meaning of the words. The person primarily responsible for a letter is the person who writes it. If he does not assent to its publication, it cannot be published. But if another gentleman informs me that he is responsible for its publication, it seems to me the obvious and logical inference is that the responsibility was his, and not that of the gentleman who wrote the letter. I would say in defence of the inference I formed that there were certain reasons which fortified me in thinking that my conclusion was not unreasonable. In the first place, I think the fact that for eight months no one has questioned the correctness of that inference is a relevant fact. I was on excellent terms with my noble friend; I was on terms of friendly and useful correspondence with Mr. Arnold White; and if either of those gentlemen had come to me in that period of eight months they had no reason to believe that any explanation they had to make would not have been received by me. Indeed, I would have done my best to set right any wrong which might have been committed. But, at all events, no such suggestion was or ever has been made to me by Mr. Arnold White. There the matter rested until some abusive paragraphs appeared in the newspapers. But this conclusion, which was accepted by this House and by nearly all the newspapers in the country, was also accepted, strangely enough, by the noble Lord himself. If I may be allowed to go to another part of this question which is very relevant to this matter, I may say I that on the 29th April the noble Lord the Member for Woolwich wrote a letter to The Times in which he stated that my inference was wrong, that I had been mistaken in regard to Mr. Arnold White, and that he was the person solely responsible for the publication of the letter. Naturally enough, a Question was asked in this House, on May 5th, with regard to this letter, and I repeated my original statement, giving my original reasons. On that occasion the noble Lord made what appeared to me to be a very remarkable speech indeed, because, as I understood him, it endorsed the offensive charges which had been made against myself.

No, certainly not.

I shall show that, I think. The speech endorsed the charges which had been made against the Department I have the honour to represent in this House. I was the more astonished, because I held in my hand a letter received from the noble Lord two days before, on no solicitation of mine, in which he deliberately went out of his way to acquit both my self and the Board of Admiralty of any offence in either of these two matters. I did not rise in my place, because the letter to me was marked private, and I asked the noble Lord, considering the position in which he put me, if I was at liberty to state in public what he had told me privately. The noble Lord re fused. I think the matter was of sufficient gravity——

I beg your pardon. I ask you to say exactly what I wrote to you.

I propose to do so. I then wrote the noble Lord telling him that this was an intolerable position—and I think it was an intolerable position. I do not want to trouble the House with that letter in extenso, but there is one passage I should like to quote. I said—

"I have called your attention to these matters for two reasons."

—that is the discrepancy between the speech and the letter—

"In the first place, because, as you have doubtless observed, your action in the matter has made me the object of attack by Mr. Arnold White, who considers himself aggrieved. In my opinion Mr. White has no ground of complaint. My action throughout has been perfectly straightforward, and Mr. White knows well that if, at any time during the past eight months, he had given me reason to believe that I was doing him, or had done him, an injustice, he would have found me ready and anxious to make amends for it. When I find, however, that you, while sharing my view as to the reasonable character of my action, are not willing to say so publicly, I think I have some reason to be dissatisfied. I have no duty to Mr. Arnold White, to whom, consciously, at any rate, I have done no wrong; and I therefore do not feel bound, or desire to enter into any controversy with him. But as a Member of the House of Commons, I think it right to let you know, as my colleague, that I take exception to the course you have adopted."

That is a portion of the letter that I wrote. In reply, the noble Lord did accord me permission to make public a portion of the letter I had asked leave to quote from. I propose, if he desires, that I should communicate to the House the portion he himself selected. This is what he said—

"On June 25th Mr. Arnold White wrote you a letter in which he stated that he was responsible for the publication of my letter. This letter to you was published in The, Times of July 6th. On that letter you were perfectly justified in making the statement you did in the House relative to Mr. Arnold White's being responsible for the publication. As a matter of fact, I told Mr. Arnold White he could do what he liked with the letter when he asked me might he publish it; and I said there was nothing in it. Neither was there anything in it which could by any means be declared as having been a trespass on confidential reports. But I was absolutely wrong to allow it to be published at all. The Admiralty never asked me the usual question, 'whether directly or indirectly, I had caused the publication, etc., etc.' If they had done so, I should naturally have told the truth, with the result that I should probably have been ordered to haul down my flag. But why should they have asked me the question after Mr. Arnold White's letter to you stating he was responsible. There is no palliation or excuse for disobeying the Service regulations. I take all the blame, and am prepared to accept the dictum of the constituted authorities with submission."

In a speech the noble Lord delivered in this House he made two statements He endorsed this accusation against the Board of Admiralty, which I represent. He said—

"The constituted authorities never wrote to me to ask me if I had written that letter. If they had, I should have told the truth."

But why should they have done so in view of Mr. Arnold White's letter? In his letter to me the noble Lord said—

"On that letter (Mr. White's), you were perfectly justified in making the statement you did in the house, relative to Mr. Arnold White being responsible for the publication."

What did he say in his speech? He said—

"When I came home the other day there were some insinuations that another gentleman was responsible for this letter; that he tried to publish a private letter which I had written."

There were no insinuations. That statement was made by me in this House in July last year, and I resent the suggestion that there was any insinuation on my part or on the part of anybody else. It was a straightforward statement, and the noble Lord has had eight months to consider whether he would repudiate it or not. He continues in his speech—

"When I came home I immediately took steps to show that I alone was responsible for the letter."

The noble Lord did not. He hauled down his flag on February 3rd; he sent his letter to The Times on April 29th. During the whole of that period of nearly three months, this accusation, which he feels so bitterly as being brought unjustly against another man, remained unanswered, and it was not until April 29th, the day following the publication of the leading article in The Times, that this gentleman was relieved of the charge which, I am told, I had unjustly put upon him. I do not understand this method of procedure, and I am very glad to have had the opportunity of stating my views with regard to it. That is all my connection with this matter. I have done no injustice, consciously, to Mr. White or any other person. I have attempted to represent the views of my Department—on a matter in which I am personally perfectly indifferent—adequately and justly. I am unable to see that any apology is due from me to Mr. Arnold White. I think that the only wrong I have done him has been to accept literally, as I believe others have clone, his word, and now he says that that was a misapprehension on my part. I do not say that in blame; but it is the situation. Perhaps there is an apology due from another quarter. This is a matter which does not concern me personally, or which I desire to press. It seems to me a trivial subject with which to have occupied the time of the House so much but perhaps the House will excuse the warmth with which I have, spoken.

rose and asked leave to make a personal explanation.

I am sure the House will be of opinion that the noble Lord also may be allowed to explain.

I must at once preface my remarks by saying that the Secretary to the Admiralty certainly was in a false position, and did get into that false position through an act of mine, which I owned to the other day. But when the Secretary to the Admiralty reads only part of the correspondence I have sent to him, it is not quite fair to myself. The Secretary to the Admiralty asked me if he might make certain extracts from a private letter which I wrote to him. I said I object to any extract being taken from a letter, because it is never done without false impressions being adduced therefrom. If you want to know anything, and you want anything made public, write to me and I answer you in any way you wish.

No, no Mr. Speaker. I must correct the noble Lord. He knows perfectly well I said that I would quote any passage out of that letter or the whole of the letter. The only passage I desired to omit was one so offensive to Mr. Arnold White that I thought he would not wish me to publish

I must answer the Secretary to the Admiralty at once. The offensive phrase was that I said Mr. Arnold White was a very dangerous man. So he is a very dangerous man. Mr. Arnold White is carried away with enthusiasm, and, as I told him to his face, he is a very dangerous man. He said—

"What do you mean?"

I said—

"I am called a dangerous man because I sometimes blurt out things I regret."

That is the whole of the offensive remark. The Secretary to the Admiralty must stick to the point. I said—and he has got it in writing in a letter he has not read out—

"I refuse you permission to publish extracts, but if you write me I shall send you for publication the whole of the letter."

I did so, and left out that part referring to Mr. Arnold White because it was not to the point. Then I turn to the other point about the insinuation. I never said anything about the Secretary to the Admiralty in this House. The insinuation I referred to was the letter in The Times, and directly I saw that letter I wrote to The Times and said I was responsible. The Secretary to the Admiralty is an extremely clever man, and I acknowledge that he has put the case against me, as it appears to the House. I admit I made a mistake as far as my writing to the Press at all is concerned, although I never before confessed it to the House. I know I was wrong, but I can prove to this House that though I was wrong I did right. I shall be in the hands of the House and I think that when I sit down they will agree with me. The House does not know the whole case. The Secretary to the Admiralty does know the whole case. What is the whole case? When I went out to the Mediterranean I found the Fleet dangerously weak—

The noble Lord must confine himself to a personal explanation on the matter before the House. He is not entitled to go into the whole condition of the Fleet in the Mediterranean. That would be going beyond the limit of a personal explanation. The noble Lord wrote a letter in which he stated that he ought not to have written a letter on a certain matter. He is entitled to deal with the circumstances arising out of the publication of the letter, but not to go into the merits of the question about the Fleet.

But there are two letters. One letter is so intimately connected with the other that I cannot explain myself unless I say I had written an official letter to my Commander-in-Chief containing the strongest animadversions about the strength of the Fleet a year before. The Commander-in-Chief sent the letter to the Admiralty, and I never received a word of reprimand about it. The fighting efficiency of the Fleet was very deficient in essentials, as compared with the Fleets of other countries. After a year I consulted my brother officers as to whether I should not go home, and beg leave to haul down my flag. My brother officers said—and I agreed with them—that that it would not be loyal, that it might create a panic, that it might not be patriotic. A year afterwards I wrote this other letter to Mr. Arnold White, who has ample evidence that I wrote it for publication and that he could publish it when he liked. Why he did not publish it then, I cannot tell. I suppose he thought that it would hurt me. I said to him I did not care whether it hurt me or not. I told him that it was important that the letter should be published in order to get those things put right which were essential to the fighting efficiency of the Mediterranean fleet. Then the public knew nothing about the letter of 1900. In June, 1901, the letter appeared. Now, what was that letter, which has been made so much of, which shows how I have been so insubordinate that I ought to be cashiered or shot, which shows that I am not a loyal naval officer, that I am not loyal to my seniors, and other nonsense of that sort? This is the letter—

"H.M.S. Ramillies, at sea, June 10, 1901. My dear——It would be most improper and prejudicial to discipline if I were to give you details as to why I am so extremely anxious, when considering the want of strength and the want of proper war organisation of the British Fleet in the Mediterranean. I have communicated my views, in as strong and clear Anglo-Saxon language as I can command, to the properly constituted authorities. My duty and business out here as second in command are simply to obey any orders that I may receive to the level best of my ability, and not to offer any criticisms which might become public. The real point to be considered is not so much the necessity of expending a further sum of money on the British Navy, as the necessity of allocating the money now voted in a different manner."

That is the letter that the Secretary to the Admiralty holds up to this House as grossly insubordinate, as trespassing on confidential reports to which I gained access through my position as second in command, for he said in this House—

"It seems highly improbable that the Rear-Admiral would take a step so contrary to the discipline of the Navy as to make public a matter with regard to the confidential reports transmitted by him with respect to the Navy in which he serves."

Well, Sir, I say that the charge with regard to that letter is very extravagant acknowledge fully that I was wrong to write to the Press at all, but when I wrote that letter I thought I was going to be called home. Never before has anything appeared in the Press in my name—and many things have—when I have been on active service, when I have not received the usual letter asking whether I directly or indirectly caused it to be put into the Press. It constantly happened—it happened four times before I wrote this letter. Things were put into the Press in my absence and in my name, and I had never said a single word, and I gave the natural answer that I had nothing to do with it. I was away when this letter was published, and both my Commander-in-Chief and I thought I was going to be called home. I had made my arrangements to go; but I received no letter from the Admiralty asking me about it, and, remember, I was at sea, and I had not seen these letters at the time of publication, though I saw them afterwards, for which Mr. Arnold White was responsible. I was waiting for the letter, asking me whether I was responsible for this, and that letter I never got. I quite see that the Secretary to the Admiralty, looking at it as I do now, was justified in making the statement he did. It was a fair statement. And I say before the House now I deeply regret that he found himself in the position he did through any action of mine. I do not regret writing the letter itself. I express no regret for that, and I do not confess to have made any error, because I say the Fleet was in a very dangerous position with regard to it fighting efficiency. Between June, 1900 and June, 1901, there were a few additions made to the Fleet—

Order, order! The noble Lord asked leave to make a personal explanation, but he is now travelling rather beyond the limits of a personal explanation.

I have been driven into it, Sir, owing to the circumstances of the case. I did not wish to mention these things. I repudiate with considerable warmth any suggestion of the Secretary to the Admiralty that I have acted dishonourably in any sense of the word. I may have acted carelessly. He suggested I was afraid for my skin. I was perfectly ready to come out at any moment. Mr. Arnold White had several letters of mine authorising him to publish this one, and then I found myself in a false position. The only thing I regret in the whole matter is that the hon. Gentleman the Secretary to the Admiralty should have been, by any action of mine, put into the position in which he was placed.

In rising to continue the discussion on the Second Reading of the Finance Bill. I may perhaps be permitted to say that the notice of Motion standing in my name that this Bill be read a second time this day six months was not in the slightest degree intended as an indication on my part of my desire to withhold from the Government all proper supplies for the efficient conduct of the public services. I put down that notice on the following grounds: First, because I believe it is absolutely unfair to throw the whole cost of the war in South Africa on the British taxpayer; and second, that the incidence of the new taxation is contrary to the only true equitable principle on which taxation can be based, namely, that every man shall be taxed according to his ability to pay. Now the financial position of this country today, in view of the alarming growth of our national expenditure, is one deserving and needing the most serious attention and consideration at our hands. When we find that for the year 1901–1902 our expenditure has risen to the unprecedented sum of nearly £213,000,000 sterling, including the expenditure on the war and grants in aid of local taxation; when we find the normal expenditure on the country has risen since 1895 £31,000,000, and when we have regard to the fact that within a comparatively few years our expenditure has gone up from £80,000,000 to £124,500,000; that our national Debt in addition to this has risen to £748,000,000, then I submit that it is of the highest importance that we should take into consideration the present financial position of this country. In all human probability we have before us a cycle of commercial depression; and the cycle of commercial inflation through which we have been passing, that has enabled this country to bear without much injury, apparently, the enormous financial burdens that have been necessary is coming to an end, and it behoves us, therefore, to consider whether we cannot in any way reduce the burden of the taxpayers of this country. I venture to submit that it is absolutely unfair that the £230,000,000 sterling, that has been expended for the South African War, should be wholly charged to the taxpayers of this country. Out of that £230,000,000 we have raised, or it is proposed to raise, £68,000,000 by taxation, and by loans £162 000,000. I submit for the consideration of this House whether the time has not come when South Africa should be made to bear, at any rate, a fair share of this enormous expenditure, which has been undertaken by this nation on her behalf. I am aware that the right hon. Gentleman the Chancellor of the Exchequer has indicated his opinion that at some future date it will be possible to charge on the revenues of these new colonies a £30,000,000 loan, but I was somewhat astonished that, seeing this war was undertaken owing to an invasion of Natal and Cape Colony, there should have been in the remarks of the right hon. Gentleman no reference to the justice and necessity of treating all alike, and indicating that the colonies of Natal and the Cape must also bear their fair share of the expenditure which has been incurred in South Africa. The reason I put down my Motion that this Bill be read a second time this day six months is simply this, to impress on the House the fact that we have already spent £230,000,000, and that the time has now come when we ought to have charged this years 32 million loan, not on the British taxpayer, but on the Transvaal, the Orange River Colony, Cape Colony and Natal. Sacrifices have been made with much patriotism on the part of the British nation, and we should endeavour to place in this Budget no more burdens on the British taxpayer. What is the condition of affairs in South Africa now? Is it not a fact that in Cape Town, Durban, and in all towns of South Africa, even in Pretoria, Johannesburg, and Bloemfontein, they are enjoying today almost unprecedented prosperity, largely arising from the war and the large and profitable contracts in connection with it, far beyond the prosperity of the overburdened and overtaxed people in-this country. Let us take into consideration the position of the industrial undertakings of South Africa I find by a reference to the share lists that the deferred shares in the De Beers Company to-day are worth ten times their issue price, and the shares of many other companies are worth several times the price at which they were issued. That shows that the £32,000,000—

Order, order! These observations seem to be more applicable to the Loan Bill than to the Bill now under the consideration of the House. This is a Bill dealing with taxation.

Of course I bow to your ruling, Sir, but I was making these observations under the title of the Bill, which runs—

"A Bill to grant certain duties of Customs and inland Revenue, to alter other duties, and to amend the Law relating to Customs and Inland Revenue and the National Debt, and to make other provision for the financial arrangements of the year."

However, I will not pursue that point further. I shall probably be in order in dealing with the financial position in carrying on the administration of the country. The question is whether it is necessary to impose fresh taxation in connection with the Budget of this year. The estimated expenditure is £174,609,000, and the estimated revenue is £147,785,000, and we are told by the right hon. Gentleman the Chancellor of the Exchequer that whilst the deficit would be about £27,000,000, there must be added "problematical expenditure," £18,500,000, which brings the deficit up to £45,324,000. The suspension of the sinking fund, £4,640,000, however, reduces that to £40,684,000, and that is the sum to be provided for. But seeing that we have peace negotiations now going on in South Africa and it would be undesirable that money voted expressly for war purposes should be expended for other purposes, that shows that this provision need not have been made now. Assuming that we provided by a loan £32,000,000 and by the suspension of the sinking fund, £4,620,000, this gives us £36,620,000 against a deficit of £26,824,000, and then the right hon. Gentleman reminded us that we had in anticipation £6,000,000 expended in China, which would, in the shape of the Chinese indemnity, be returned to us.

Not this year. That is a receipt I look forward to.

And the Exchequer balances £3,534,000 are also available. There appears therefore to be no pressing necessity for the imposition of additional taxation in this year's Budget. Now, the question has been raised over and over again as to whether our basis of taxation is broad enough, and whether a fair burden has been placed on the masses of the people of this country or not, and whether too large a burden has not been placed on the wealthier classes. The treatment that has been given to the wealthier classes by the right hon. Gentleman is, in my opinion, most singular. He has withdrawn the cheque tax, while, on the other hand, this corn tax, which reverses the true principle of taxation, inasmuch as it places the heaviest burden on those who are least able to pay is retained. The incidence of the corn tax is unequal and inequitable, and on those grounds it is not in accordance with the sound principle of finance, which is, that everybody should be taxed in accordance with their ability to pay. With regard to taxation, I have taken out the figures for 1902–3, and I find the estimated income from customs excise and posts and telegraphs amounts to no less than £84,000,000, and a very large portion of this high sum comes out of the pockets of the masses of the people. For instance, of the new taxation imposed during the last three years, I find the tax on tea, tobacco, sugar, spirits, beer, and coal has amounted to no less than £33,500,000, and if we add the corn tax of £2,600,000, £36,000,000 will be largely paid by the working classes. On the other hand for the current amount paid by the wealthier portion of the community in income tax, death duties, stamps, land and house tax, and miscellaneous taxes amounts to only £64,000,000 as compared with the £84,000,000 to which I referred just now. I oppose the Second Reading of the Finance Bill because I believe that the figures I have given show that the masses of the people in this country have had already put upon their shoulders more than their full share of the burden the country has to bear at this moment. A great deal of heart-burning and a great deal of friction would have been avoided if this expenditure had been met by some' scheme of a graduated income tax. There is no doubt the right hon. Gentleman the Member for West Monmouth-shire made in connection with his death duties scheme, the greatest and most important financial departure that has been made in this generation, at least, and it would have been wise of the Chancellor of Exchequer, if instead of this corn tax, he had taken into consideration on this occasion some new scheme of a graduated income tax which could be equitably imposed on those who could afford to pay. I am told there would be great difficulty in the collection of a graduated income tax, and I do not deny that there may be difficulties, but I believe that we could overcome those difficulties, and that this question should be approached with a view to finding a satisfactory solution of them. Then there is a means of taxation which the right hon. Gentleman might have adopted, which would have provided a considerable additional income to the National Exchequer. I allude to the taxation of ground values. There is no doubt that in the populous neighbourhood unoccupied land increases in value every year by reason of public improvements, and that a perfectly fair tax on it would bring a considerable amount to the Exchequer. An ad valorem duty of 1d. on £1 certificates in connexion with the formation of new companies, and a pro rata duty on certificates of a higher value might also have been levied. Then there is the question of a substantial tax or charge for a licence on motor cars, which are multiplying rapidly, and are propelled at such a speed as to be a real danger to the public. I think we ought to impose a tax on them. This Finance Bill relates to the Customs, and making other arrangements for the financial necessities of the year. There was one tax imposed last year which the Chancellor of the Exchequer told us had not been found to work so disastrously to the commercial interests of the coal trade as had been prophesied. But the conditions under which that trade is conducted have altered very materially since last year, and there are reasonable grounds for asking that there should be added to the Finance Bill a clause reducing the amount of that burden. We have now had a little time in which to ascertain exactly the operation of the tax. There were previously in force in foreign countries certain import duties on British coal—in France, 11¾d.; in Russia (Northern ports), 1s. 11¾d.; in Spain, 2s.; in Denmark, 1s.; and in Portugal, 1s. 6¾d.—as hindrances to successful trading in British coal. Unfortunately for the coal-owning industry, prices have fallen enormously since last year. Coal which was being sold to railway companies at 16s. a ton eighteen months ago is now being sold at 9s; the same is true with regard to other classes of coal, and also of coke. The producers of coal in Belgium, Germany, and France last year and the year before had so large a demand in their own countries that they had no coal to export to neighbouring countries in competition with us. That condition of affairs has now changed. Trade is declining. The consumption of coal in the different countries on the Continent has gone down, and in this country it has decreased to an even greater extent. The Chancellor of the Exchequer, in his Budget speech, gave figures to show that nearly 300,000 tons more of coal had been exported from this country in the first three months of this year, as-compared with the corresponding period of last year. That is perfectly true, but, as knowing intimately the coal trade, I may explain that that is due to the fact that the demand at home was so much lessened that we were obliged to push our foreign trade. But that does not alter the fact that the price the German and French coal producers are willing to accept in certain markets naturally influences the price we can get for our coal. I do not wish to make assertions without proof. Within the last two years the shipments of a particular colliery in my district to Hamburg has decreased from 70,000 to 35,000 tons, to Holland from 15,000 tons to nothing, to Belgium from 120,000 to 50,000. The consequence is that that colliery is working only three days a week, with an increase cost of 9d. per ton, and the price realised barely covers the cost. They have certainly had the advantage of a reduction in freights to the extent of about 6d. per ton, but even then, as I say, they are barely covering cost. As I urged in the discussions last year, this tax is unfair in its incidence. Why has the tax been imposed upon exported coal only? The collieries which do not export coal have actually made more money during the recent times of prosperity than the exporting collieries. If, as I pointed out last year, instead of this export duty, a duty of 2d.—1d. payable by the colliery owner, and 1d. by the royalty owner—were put on all coal, the Chancellor of the Exchequer would receive practically the same amount and the burden would be nil. If, as seems likely, there is a further fall in the price of coal, the colliery to which I have referred must inevitably be closed, and at least 1,000 men will be thrown out of employment. I am aware that from certain districts in Wales there has been an increase in the export of coal, but that is not the case in South Yorkshire or Durham and Northumberland. For instance, the export of coal in 1901 as compared with 1900 decreased by 2,200,000 tons, but I admit that 1900 was an abnormal year, and does not constitute a fair comparison. Then we are told that the exports during the first three months of this year rose 300,000 tons as compared with the first three months of last year. That is a rise of 3·2 per cent., but at the same time the value diminished by 14·6 per cent. So far as the north-east ports are concerned in January of this year they showed a decrease in export of coal to the Continent of no less than 36,000 tons, and in February the decrease was 34,500 tons. These facts speak for themselves. What they tend to show is that, although in a time of great commercial prosperity and high prices, a burden such as this export duty on coal may be borne without serious injury if, as we anticipate, we are coming to a period of commercial depression and low prices, this tax will prove a very injurious and unfair burden. The coal trade, having been somewhat prosperous of recent years, does not receive at the hands of the general community that consideration and really fair treatment which it ought to have. Particularly is the domestic consumer up in arms against the colliery owner. But what is the fact? The collieries which supply the domestic consumer do not pay a single farthing of this tax. It is the exporting collieries, who in nine cases out of ten do not supply any coal for domestic purposes and are not getting the extravagant prices at which domestic coal has been maintained, who are hit by this tax. In addition to that, the method On which the income tax assessments are made presses very hardly at present on colliery owners, inasmuch as they are assessed on the average of the preceding five years, with an adjustment on the average of the preceding three years. That assessment at present includes the recent years of very high prices, whereas today in some cases no profits at all are being made. I admit we gained an advantage when we were basing our assessments on previous lean years, but unfortunately that was when the income tax was 8d. in the pound, and now we are getting the disadvantage with the income tax at 1s. 3d. How it will work out on an average of years when we know the result of the next two years, I cannot say, but I think that, with trade declining, we have a fair case for pressing upon the Chancellor of the Exchequer the desirability of some reduction of the export duty on coal, and I hope he will give the matter his careful consideration.

I agree with a great deal of what has fallen from the hon. Gentleman who has just spoken. He has introduced into the debate a certain amount of practical experience of life. With the exception of the speech just delivered, and the brilliant address of my hon. friend the Secretary to the Treasury, we have been living during this debate in an atmosphere of mysticism, an atmosphere of the past. The right hon. Gentleman the Chancellor of the Exchequer almost apologised when introducing his Budget imposing this registration duty on corn, because he did not place upon posterity the same amount of taxation as was imposed during the Crimean war. But we have all to work out our own salvation, and what the people did in the past has absolutely nothing to do with us in the present day. It has been absolutely amusing to me to hear speeches delivered by right hon. Members on both sides with which the great names of Gladstone, Cobden and Peel have been reproduced time after time with wearisome persistency. I yield to no man in my admiration of these men, but they lived under totally different circumstances than those under which we are living at the present day. In this debate the Chancellor of the Exchequer reminds me of a nigger driver lashing an unfortunate negro who was yelling vigorously, threw down his whip, crying out, "flog high or flog low, there's no pleasing you." There is no way of pleasing us except by taking off the taxes. I much regret that the Chancellor of the Exchequer has given way to the financiers of the city with regard to the cheque tax. I think it was a reasonable and just imposition, and one which would have been felt by no one in the country. The great argument we have had during the last two days has been as to whether this tax is of a Free Trade or Protectionist character. Hon. Members have been most careful to explain, with hardly any exception, that they are all Free Traders. That being so it is very little use explaining at further length my views upon this point. Last evening the Leader of the Opposition wished to cross-examine the Chancellor of the Exchequer as to whether this tax had any connection with a new Canadian policy. I should like to say with regard to the Colonial view of this question, of which I know something, that we hold that this is a matter for the United Kingdom, and it is of very little consequence to the Colonies what we do here. The matter is entirely one for the people of this country and for them only. It does not seem to be recognised that the areas which are open to our trade are growing smaller year by year and our limits are being gradually confined. In the days of Cobden we practically controlled the whole of the seas and the whole world. How different are things at the present day. In a speech delivered last autumn the right hon. Gentleman the Member for East Fife challenged any Protectionist to point to any country which had adopted Protection with credit and profit to itself, and is reported to have said "I accept the challenge and point out to the right hon. Gentleman the United States of America." I do not know why the right hon. Gentleman did not speak in the same strain in this House, because if he will give us the Protection which the United States of America has adopted every Protectionist will be satisfied. Ours is a greater Empire than the United States, but is there not more poverty in this country than in the United States? America has succeeded beyond any other nation in the West in wealth and material prosperity. Is not the standard of living infinitely greater in the United States than here? And yet all this has been done under what hon. Gentlemen opposite call the policy of Protection, but which has proved to be a policy of self-interest and self-defence. What has struck me about this debate is the intense unreality of the speeches of right hon. Gentlemen and hon. Gentlemen opposite. In the course of his speech the right hon. Gentleman the Member for West Monmouthshire said that there were 1,000,000 paupers in this country out of 40,000,000, and that in London last month there were 111,000 out of 4,500,000—and how many more?—who were on the brink of starvation struggling not to become paupers. The hon. Member for Dumfries used very similar words for speaking of poverty in the East End of London; he told us that—

"Upon the very poor, upon people on the verge of starvation, so numerous as one-third of the population in the East End of London, this tax was cruel and inhuman."

I am perfectly certain that the right hon. Gentleman did not wish to impute motives of cruelty or inhumanity to Members on this side of the House, and it was merely a way of expressing disapproval of the policy of the Government. Do hon. Members opposite in making these speeches—does the hon. Member for East Edinburgh in using the violent language he did use in regard to this tax—seriously consider where their arguments all lead them to? After fifty years of almost absolute peace, after fifty years of good trade, and fifty years of unparalleled prosperity, and doing nothing else but making money here we are in this country in the condition described by the right hon. Gentleman the Member for West Monmouthshire, with an enormous proportion of the population on the vegre of starvation. Hon. Members say that all this is due to the imposition of a farthing tax upon a loaf. Is that not a remarkable position for them to take up? Do they not see where such worthless arguments lead to. With all this poverty existing, why did hon. Members opposite not tell the House about the hundreds of thousands of people who every night have nowhere to lay their heads? And this after fifty years of Free Trade. [An HON. MEMBER: Then why-tax their bread in addition?] After ail these years of Free Trade why do not some hon. Members tell us what state of decay our village life is in, and what is the condition of the workers in our villages. Hon. Members have spoken of the rate of wages in their respective districts. I have been told that in some districts men have to keep their wives and families on the miserable pittance of 12s. a week. [Cries of "No, no!"] Is that not a scandal in a great country like this after fifty years of Free Trade and unexampled prosperity? Surely we ought to long for the days of Cobden and Bright again, in order to voice the sufferings of the struggling people of this country who are evidently dissatisfied with what they see going on around them. We see people living in luxury, and almost sensual vice going on worse than it was before, and it is this extraordinary political creed which has brought so much misery into the country. I see signs in the future of even far greater extravagance. Look at the extravagant sums now being spent in various ways by the wealthy which might as well be thrown away. The result of the policy of the past has been to drive away your manufactures into the hands of foreigners. That has been the effect of your Free Trade policy. We have a great future before us, but we can only succeed by looking facts in the face and by refusing to accept the doctrinesand principles of the past. It is nothing to us what people said in the past. We have the greatest reverence for the Free Traders of the past, but we have now to look at matters which arise from our own standpoint. With regard to our Navy, it costs an enormous sum of money year by year. Why do we keep up this enormous Fleet and spend this enormous sum upon it? I should be sorry to see the expenditure upon the Navy reduced by one shilling, and I would rather see it increased. Why do we keep up this enormous navy? For this reason that if it were not for our navy we should be in danger of starvation. We all look at history from different points of view, and my recollection of the downfall of the Roman Empire is that Slavery and Plutocracy ruined the Empire. People ceased to work for themselves; and instead of growing corn for themselves they began to import corn to an enormous extent. The result was that on the one hand the people lived in misery, on the other hand they lived in luxury and vice. We shall have to take care that this country does not fall in the same way as the great Roman Empire, and if we do fall in this way we shall have no one to blame but ourselves, because we have not looked at matters in the manner in which they will affect the very lowest and humblest class in our midst. This tax is not a very serious one, and if we find that, as hon. Members predict, it presses hardly upon the widow and orphan, there is no need to have this tax again next year. I do not know that this view will be accepted, but I have not the slightest hesitation in giving my vote in favour of this Bill.

The hon. Gentleman who has just sat down began by pronouncing an impartial and comprehensive censure upon the whole of this debate. He told us that with one or two exceptions all the speeches appeared to be mysterious, unreal, and unpractical, and he illustrated his meaning by avowing himself as almost the only champion of Protection and absolutely the only defender of the cheque tax in this House. I am not concerned in the censure pronounced by the hon. Gentleman, because I have taken no part in the proceedings on the Budget hitherto at all. In the few observations I desire to submit to the House, I shall speak from the point of view of a great industrial constituency, upon which the enactments of this Budget will fall with peculiar severity. I am not going into the corn tax. I have refrained from speaking upon that because my objection to this Budget applies to pretty nearly all the taxes, including, I might almost say, the addition to the income tax. I ought to say, to begin with, that I accept the declaration of principle which was made last night by the hon. Gentleman the Secretary to the Treasury, repeating in different terms the statement made by almost every Government speaker. The Secretary to the Treasury wound up a very interesting speech by saying this: He could not believe that those who approved of the policy which the Government had been carrying on would grudge their contribution to the expenditure involved, or would expect to have all the advantages of empire without bearing any portion of the expenses. I accept that statement, but I cannot accept the conclusion that has been drawn from it by every speaker on the Government side, that the working class in particular have approved of the policy of the war, and that, therefore, they ought not to grudge the imposition of the corn tax. I speak as the representative of a great many working men in this House, and I demur to the statement that the working classes as a whole, or the working classes even by a majority, have expressed their approval of this war policy. The war was begun, and the policy entered upon, without their having any opportunity of being consulted at all, and when the Government dissolved Parliament, as it did in the autumn of 1900, it took care to dissolve at a time which necessarily disfranchised a large portion of the working class. In my own constituency we found that an eighth of the electorate was disfranchised by the time at which the election was held, and that eighth naturally and necessarily belonged to the working classes, and accordingly I do not accept as a defence of the corn tax or any other tax the allegation that the working classes approved of the war policy. That defence absolutely fails, for this reason: that the tax falls with the most crushing severity upon those who could never have approved of the policy of the war because they have no votes at all. Those upon whom this tax will fall with greatest severity are the voteless and the voiceless ones in this country. In my own constituency not long ago I took part in what threatened to be a great local strike. Hon. Members who are not acquainted with industrial constituencies may be surprised when I tell them that the whole matter was a dispute over 6d. a week to the employees in the jute trade. The very smallness of the sum shows how severely such an increase as is now to take place on the necessaries of life, coming on the top of the taxes on tea and sugar, must fall—on women in particular, but upon all classes of poor labourers, of whom there are many examples in the constituency I represent. I pass now to state what appears to me to be the great blot of this financial scheme. It appears to me to be a serious criticism to make upon it, that it lays all those taxes upon the necessaries of life, and deliberately—I was going to say contumaciously—evades sources of public revenue which do not depend upon taxation at all. I will make it my business today to prove to the House and the country that there are sources of revenue which the Chancellor of the Exchequer has not touched at all, and by avoiding which he has laid upon himself the necessity of taxing the bread, tea, and sugar of the people. Some of those sources of revenue have been named already, and no answer has been given to any of the suggestions which have been made. I venture to say that the Chancellor of the Exchequer, or some member of the Government, ought to tell us why they have taxed tea, sugar, and bread, and the incomes of the people, and have avoided those sources of public revenue which would not involve any taxation at all. One obvious recourse would be to those doles which were reenacted last year for the agricultural class. I say that, rather than tax sugar, bread, and other necessaries of life, the right hon. Gentleman ought to have proposed to call back those doles, and thereby have evaded the necessity for new taxation of this kind. There is the question of ground values, to which the hon. Member behind me has referred. [An HON. MEMBER: That would be local taxation.] The taxation from ground values would go to the local communities, but the Government could take from them the Imperial subventions which they have at present, so that the taxation of ground values would necessarily go in aid of the Imperial Exchequer, and would do away with the necessity of taxing such necessaries of life as the Budget proposes to tax. I come now to more debatable ground. I am sorry that the hon. Gentleman who spoke last has left the House, because I know that he takes a great interest in the suggestion that I am about, not for the first time, to make in all seriousness to the House, and I make it on the terms which I have quoted from the speech yesterday of the Secretary to the Treasury. The suggestion I make is that at this moment it is the duty of the Government to ask our great self-governing colonies to make their due contribution to the expenditure of the empire. This is no new story. I want to quote in support of that proposition no less an authority than the Chancellor of the Exchequer himself. This is what he said five years ago—

"As Chancellor of the Exchequer, I am bound to put before you the fact that 40,000,000 people of the United Kingdom pay £22,000,000 a year for the cost of our common Navy, while 10,000,000 people of the same race pay a few thousands a year and find but very few men.

That cannot and ought not to be the permanent situation of the relations between the great self governing colonies and the United Kingdom. That cannot and ought not to be the permanent settlement of the arrangements between the great self-governing colonies and the United Kingdom."

Since these words were uttered the expenditure on the Navy has gone up from £22,000,000 to £34,000,000 at the present time, and not a single advance has been made towards a colonial contribution. Surely when the Chancellor of the Exchequer five years ago declared that, so far as the Navy was concerned, this contribution, ought to be made, he ought in this year, when he is proposing, in order to meet that expenditure, to tax the necessaries of life for the poorest of the community, to have been able I to tell us that he has made some attempts to make these contributions, or that he was going to make some attempts, or, at all events, that he has some explanation or reason why the principle laid down five years ago has never yet been put into practical effect. I will not dwell on this particular item, because I know that there is going to be a Conference of the representatives of the Colonies held soon, where I suppose that this and many other things will be discussed. I hope that we shall have from the Chancellor of the Exchequer the assurance that this question has not gone back, and that, in spite of what has been said by certain eminent colonial representatives, the Chancellor, as representing the Government, will stick by his principles, and submit to them the desirability and the propriety of making some contribution, at all events, to the expenditure of the force, which does not exist alone, as the hon. Member said, to protect the food of the people of this country, but which exists in equal degree for every one of our self-governing colonies, so that whatever contribution they may pay in this respect will be nothing more than payment for services rendered. There is another and less agreeable aspect of this question on which I should like to say a word or two. We have to meet by means of this taxation not only the normal expenditure on the Navy, but the special expenditure caused by the war, and I call in the aid again of the eloquent words of my hon. friend the-Secretary to the Treasury. I agree with him, and I say that I cannot believe that those who have approved of the policy the Government have been carrying on will grudge a contribution to the expenditure involved, or will expect all the advantages of the empire without bearing any portion of the expense. Do not these words apply equally to the colonies as to the people of this country? Do they not apply more to the colonies in general than they do to the working classes of this country? The working classes of this country have authorised no man to say in their name that they approve of this policy of the war. Some of our great self-governing colonies have done so. We have been reading during the last year many declarations made by colonial statesmen, exceeding in strength even those that come from the members of the Government at home—declarations that we have shown too much leniency to the enemy, and that the war should be fought to a finish. I am going to refer to one of those statements by a gentleman who has made himself most conspicuous in the matter. The colonial statesman to whom I refer is Mr. Seddon.

The right hon. Mr. Seddon.

It was from no want of respect that I referred to him as Mr. Seddon, but simply because it is not the habit in this House to speak otherwise. I speak of him with perfect respect, and if I deal with his opinions, it is from no disrespect to the gentleman himself. Being the Premier of a great self-governing colony, his words are entitled to respectful consideration. In the name-of the colony he denounced all those in this country who were opposed to the war. I shall only quote one sentence of Mr. Seddon's. A meeting took place at Wellington, New Zealand, on April 14th, when Mr. Seddon was setting forth on his mission to this country. I believe that he is now engaged in a mission in South Africa. At that meeting the Chief Justice, Sir Robert Stout, vouched for Mr. Seddon in this way. He said—

"He is leaving for England, there to express, on behalf of us as one community, our entire unanimity in regard to the justice and necessity of this unfortunate war."

That is the extra-judicial declaration of the authenticity of Mr. Seddon's credentials for coming to this country. Mr. Seddon himself said—

"We are as determined as ever that peace can only come as the result of unconditional surrender."

That is the message from New Zealand to the people of this country. Now, what I have got to say about it is that no Prime Minister would be justified in using this language unless he had the colony behind him; and no colony is justified in allowing that language to be used in its name unless it is prepared to accept its full share of the expenditure on the war, and to range itself alongside the people of this country. That is the proposition I lay down. Has any colony done that? Let me say I fully appreciate the gallantry of the colonial soldiers who have gone to the front and fought in this controversy. I fully and admiringly acknowledge their services; but I no more admit that their presence in the field absolves their country from paying a share of the expense of the war than that the Chancellor of the Exchequer should allow me to get off' the payment of the Income Tax because twenty or thirty of my Scotch constituents had gone to the front. Speeches have been made by hon. and right hon. Gentlemen opposite, and leaders have appeared in the papers setting forth that the colonies having declared in favour of the war we must consult them as to the terms of settlement. That being so, I hold that the Governments of the colonies ought to accept the consequences of that position, and one of the consequences of that position is that before you levy this tax upon the necessaries of subsistence of the very poorest in this country, many of whom are against the war, but who have no opportunity of voting against it, you should go to the colonies and ask them to pay some share of the great burden placed on this country. The only source of non-taxed revenue to which I shall call the attention of the House is of a different character altogether. This, again, is no new subject to the Chancellor of the Exchequer. We have in this country one of the vastest, one of the most lucrative, I was going to say one of the most corrupting, monopolies known in any civilised country. One of our reasons for going to war with the Republic of the Transvaal, a foreign State, was that a corrupt oligarchy had established there improper monopolies. Why, that is what we are doing now, and what we have been doing in this country for more than a generation. The monopoly to which I refer is a monopoly which is growing in value and mischief every day. It is in the hands of a restricted number of people who are allowed to traffic in drink—I mean the licensed victuallers. I am not attacking an actual seller across the, counter, who in many cases has nothing to do with the monopoly; but those men who own the licences, brewers and others, who largely profit by the monopoly. It is my business to show to the House how vast is that monopoly, and how that source of revenue is free almost from the suspicion of taxation. The duty on a publican's licence has been fixed for many years, and every temperance reform has only had the effect of making the publican's monopoly the more dangerous, because every licence destroyed through the influence of temperance agitation only adds to the value of those that remain. This has been the case, in a very marked degree, in London and Birmingham. I submit to the House that this is a large monopoly, the whole value of which belongs to the public, and is just as much public property as are the Crown lands; and that it is an evasion of our duty to suffer this vast, valuable property to remain in private pockets. More than that, I maintain that it is a shameful evasion of our duty that, in order to relieve the pockets of these monopolists, we go to people with 13s. a week wages, and take from them a little bread, tea, and sugar. I will only give one crucial example of what I mean. Hon. Members are familiar with the prospectus of a new Company, calling itself The Public House Trust. It is being established in many parts of the country. The originator of that Trust is Earl Grey who was led to make this fruitful suggestion by an experience of his own, which he has narrated in a letter to The Times. In his neighbourhood there had sprung up a new mining village, where it became a matter of certainty that a public house would sometime be established. Lord Grey himself applied for the licence, which was thereupon given to him. Within a week his Lordship was informed that he might have £10,000 for that licence, if he chose to transfer it, although he had not spent one single fathing in connection with it. £10,000 was the value of the monopoly handed over to Lord Grey on that occasion. Now, why was it worth anybody's while to pay £10,000 for the licence? There are two reasons. One is that the licences are restricted in number by the licensing authorities; the other is that the licence duties are so low that the monopoly is in no sense taxed at all—so low, that this would-be purchaser from Lord Grey could afford to pay £10,000, not for the freehold of the license, for it has to be annually renewed, but for the chance of its being renewed, and that the present small licence duty will be continued by a sympathetic Chancellor of the Exchequer. I put it to the Chancellor of the Exchequer whether this is a satisfactory state of affairs for this country. I will not argue the question of vested rights, but I do maintain that the licensed victualler has no vested interest in the continuance of the licence duty at the ridiculously low rate at which it now stands. I submit that I have proved that there is here a source of public revenue which has not been touched, and which ought to be exhausted before the necessaries of life of the poorest people in the country are taxed. In the remarkable book published by Messrs. Rowntree and Shirwill many instances are given of the large amounts paid for a licence, one reaching to £50,000. I could give many reasons why this monopoly should be attacked. I might point to its corrupting influence, for if you took away this monopoly value from the licensed victualler by increasing the licence duties, so as to exhaust the monopoly value, all the difficulties in regard to compensation would vanish. There would be no necessity to pay compensation, except for the goodwill of the business and disturbance, which I would willingly grant. I have plied the Chancellor of the Exchequer with Questions on this subject, but I have had no answer as to the value of this monopoly. I, therefore, have had to investigate the subject for myself, and make calculations as to the extent of the value of the monopoly, as far as I have been able. In my own constituency I have consulted the most experienced valuer of licences, and he tells me that fifty years ago the value of the licences in Dundee was a negligible quantity. Today he tells me that their monopoly value—not including any property, but the mere value the licences—is£50,000 per annum. It is larger in some towns, no doubt, than in others, but my own guess is that the Chancellor of the Exchequer could, with perfect safety—of course, it is a mere conjecture—rely on taking £6,000,000 a year from these licences. That is a low estimate compared with the calculations I have received. At all events, I have no doubt that if he simply doubled the licences, which would not affect anybody injuriously, and would not touch the price of commodoties at all,—it is only the monopoly I want to get at—he could raise another £1,500,000. These are not duties, nor taxes. It is absurd to call by the name of a tax that which capitalists are willing to give from £10,000 to £50,000 for the privilege of paying. The time is coming when something must be done to take for public services this large source of public revenue, and which is as much public revenue as Crown lands. I have only one word more to say. A great deal has been said about broadening the basis of taxation by way of defence of indirect taxation. It seems to me to be forgotten, especially by hon. Members opposite, that a large section of our people are not in a position to bear any taxation at all, and that they ought not to be taxed. I am accepting the principle laid down by that great economist, my friend and leader, John Stuart Mill, viz., that the State should allow a necessary margin for subsistence before taxing anybody at all, and should only tax the citizen upon the excess of his income over that margin. John Stuart Mill's margin was £50 a year, or £1 a week. I am afraid that would possibly be too high a margin. I find that that great statistician, Sir Robert Giften, states that the entire income of the working classes, when he last calculated it, was just £50 a year. The whole amount paid in wages, divided by the number of workers, gave that result. Of course, there are millions of workmen who get more than that, and who ought to he taxed on their margin; but millions more—how many no man knows—get much less; to tax them at all is a cruel injustice, and to add to their taxation is, in my humble opinion, a wicked wrong. But if we are to have indirect taxation, we cannot avoid taxing these people. I object to the increase of indirect taxation, because it does increase the misery of that class; at the same time, we cannot do without some kind of indirect taxation. But I maintain that if we must take from the too small resources of those who ought not to be taxed at all, then we impose on ourselves the duty of giving it back to them in some way or other. They have it back in part in education, and that leads me to believe that we ought to pay for education out of the Imperial Exchequer altogether. Beyond that, there is another step you have to take. If you increase, as you are increasing, the amount of taxation which is not morally unjustifiable, but which is economically inevitable, then you re-visit on yourselves the demand you took up in a lightsome mood some years ago on behalf of these people—that, at all events, their closing years should be made passably comfortable by old age pensions. [HON. MEMBERS: Hear, hear.] Hon. Gentlemen cheer that, but the time which is selected by the Chancellor of the Exchequer for putting these additional burdens on those who ought not to bear any burden at all, is the very time when he and all his colleagues have repudiated and disowned the old age pension scheme on which they came into office seven years ago.

I had intended this afternoon to have endeavoured to convert this House to the principle of a 10 per cent. import duty on foreign manufactured goods, but I find great obstacles in my way. In the first place, I do not find evidence of a proper philosophical spirit in the House; the prevailing sprit appears to be rather to think of obtaining a long holiday than to discuss economic truths. In the second place, I admit that the imposition of the corn duty raises a somewhat serious but temporary prejudice against the principle I advocate. That tax is a tax for revenue, but if I were Chancellor of the Exchequer a tax on corn would be the very last with which I would begin if I wished to initiate a Protective system. Therefore, I cannot at all share the elation which was displayed by my hon. and gallant colleague at the imposition of this tax, because I think it places a serious obstacle, in public opinion, against the realisation of the principle of other Customs duties which he and I hold. It was a taunt made against those who hold my opinion, in yesterday's debate, that we preserved deliberate silence during the discussion of the corn tax. Speaking for myself, I confess I was suffering from an acute form of what I may call oratorical constipation during that debate. I recognised that the circumstances of the moment did not enable me to obtain relief until now, but I shall certainly pursue my postulate on the next stage of this Bill.

ft is surprising that it is not until the third day in this debate that the Protectionists have raised their voice in this House. At any rate, we have now discovered that there are a certain number of avowed Protectionists on the other side. I find a difficulty in dealing with this Budget, from the fact that we have to distinguish between temporary, or war, expenditure and permanent expenditure. Fortunately, the distinction is not one difficult to make, but it is necessary to make it if we are to form any opinion on the declared policy of the Party opposite. I find in this Budget that the estimated revenue for the current year is close on £153,000,000, and that the estimated expenditure—I refer to peace expenditure only—is £124,500,000. Subtracting one from the other, we got a surplus of £28,500,000, a sum which under ordinary circumstances, would be available for the repeal of taxation if the war were over. But we have first of all to make a heavy deduction, because in this year's Estimates the amount for the National Debt service is only £18,360,000. When the war is over, that sum will obviously have to be very largely increased, proportionate to the large increase in the Debt. In 1874 Sir Stafford Northcote first established a fixed Debt charge. The National Debt was then £769,000,000, and he fixed the charge at £28,000,000. Two successive Conservative Chancellors of the Exchequer reduced that charge—first to £25,000,000, and then to £23,000,000; and it stood at the latter figure when the Debt had been reduced to £627,000,000. Today the Debt is £786,000,000, and, whatever may be the difference of view as to the proper provision to be made for the repayment of the Debt, I do not think that anyone will argue that the present Chancellor of the Exchequer should take a less heroic view than was taken by Sir Stafford Northcote in 1874. I know that some reduction might be urged on the ground that the interest today is only 2 ½ per cent., as against 3 per cent in 1874; but we have to remember that we are under a duty to make greater efforts at the present time to reduce our debt, as we are in more fierce competition for the supremacy of international trade than we were in 1874, when we held the lead practically unchallenged. I do not think, therefore, that it is an over-cautious estimate that we should replace the fixed charge for the National Debt service at £28,000,00. That will compel us to add over £9,500,000 to the present estimated expenditure, and will reduce our apparent surplus from £28,500,000 to £18,750,000, available for the reduction of taxation. That is not all. After the war is over, there will not only be increased pay for the Navy, and an additional charge for education, both of which can probably be met by the natural expansion of revenue, but there will be an inevitable charge for the government of the two new colonies. I have endeavoured to put that estimate as low as I can, and to allow for no more than an occupying force of 20,000 men at the cost of the Imperial Government, and I find in the Report of Sir David Barbour that the cost of 20,000 men in South Africa would be £5,000,000 a year. Deduct that from the surplus of £18,750,000, and we have a final sum of £13,750,000 available for the reduction of taxation after the war is over. So far, what I have stated rests upon figures which can hardly be disputed, and contains no estimate whatever, except the very moderate estimate for the government of the Orange River and Transvaal Colonies. Now I come to what, in its nature, must be speculation, but a speculation which I think the House will agree is sufficiently based on obvious facts to be accurate. What will be the taxes that will be repealed when the war is over If any hon. Member will take the trouble to read the Bill we are now discussing, he will see that certain of the additional duties on tea, tobacco, beer, and spirits are for one year only, whereas the main duties on all the articles named, with the exception of tea, are permanent. It is not, therefore, much of an assumption to suppose that it is the intention of the Chancellor of the Exchequer, as soon as the war is over, to take oft' the additional taxes which are imposed for one year only. I am strengthened in that assumption by the Chancellor of the Exchequer's frequent reiteration that the revenue-producing power of taxation on beer and tobacco is very nearly exhausted. If these additional taxes are repealed, they will absorb nearly £6,500,000. But, acting on the declared principle of the Chancellor of the exchequer, that for every reduction of indirect taxation there must be a corresponding reduction of direct taxation in order to maintain general equality between them, we may expect that he will take 3d. off the income tax as an equivalent to the reduction in indirect taxation. That will absorb £7,500,000, which, added to the sums I have already given, will swallow up the whole of the existing surplus. My calculation is based on the terms of the Bill, and upon the declared policy of the Chancellor of the Exchequer. Some such calculation is necessary if we are to understand what is the settled financial policy of the Party opposite. We have, then, this result. We have to face an income tax of 1s. in the pound, a corn tax, a sugar tax, and a coal tax, as permanent imposts on the people of this country. If we accept this Bill, we must make up our minds for these taxes, be there peace or be there war. That is the price we have paid for seven years of government by Lord Salisbury, assisted by right hon. Gentlemen opposite. I am not arguing whether the price is worth it or not; no doubt hon. Gentlemen opposite will think that they have had value for their money, but there stands the fact that that is the price they have paid; and if they think they have had value, so lot it be. I will not take that consolation from thorn, provided they will mend their ways in future. Do not let them think, however, that that is all they have paid for seven years of Lord Salisbury's government. During the period this Government have been in office, we have had a magnificent revenue. Calculated on the basis of taxation when Lord Salisbury came into office, the natural expansion of the revenue during the last seven years, up to the end of 1901–2, has been no less than £24,000,000 a year. That means that we have had an additional £24,000,000 of increased revenue, and £20,000,000 of additional taxation to spend. Where has all the money gone? There are £44,000,000 in all to account for. We are all for a strong Navy, and since 1895 we have spent an additional £14,000,000 a year on the Navy. We are all for better education, and since 1895 we have added £3,000,000 to its annual cost. I do not think, in either case, the money has been spent to advantage. We will allow, however, that £17,000,000 has been creditably spent, and we have to allow a further £3,000,000 a year for the increased charge for the debt. Altogether that amounts to £20,000,000, out of £44,000,000 of added expenditure. Where has the other £24,000,000 gone? Where can we find in administrative improvements any justification for the expenditure of such a vast revenue as £24,000,000 a year? A large amount has gone to the War Office, but are hon. Gentlemen opposite satisfied with that expenditure? We have spent also a great deal on Foreign Office wars on the East Coast of Africa, and Colonial Office wars on the West Coast of Africa, and we shall continue to spend a great deal of money on wars of that sort so long as the self-importance of these Civil Departments is fostered by allowing them to keep armies under their control. We have thrown away £250,000 on Wei-hai-Wei to save our face. But if we want to find where the money has largely gone, we must go carefully through the Estimates. There we shall find item after item, like the notorious one of the salaries of the Law Officers of the Crown, in which you will see additional expenditure, small in amount, but covering so vast a number of items that the total has contributed considerably to absorb the £24,000,000 I. have named. I will not refer to another item, which has cost us millions—it has been mentioned frequently—I mean doles. The Government, which takes as its principle not to forget its friends, cannot be expected to overlook their claims in the matter of doles. All this has happened during the seven years in which we have had a declared economist at the Treasury. If we are to have the Party opposite in power, I am bound to say that for the sake of the nation I am infinitely glad that we should have the present Chancellor of the Exchequer at the head of the Treasury, for undoubtedly he has, time after time, done his utmost to resist the extravagant tendencies to which he is subjected. But what has been his case? Year after year he has told us that he is helpless to resist this increase of expenditure. He attributes the pressure to the whole House. We, perhaps, with more justice, may attribute the pressure to the dead weight of Party habit, which inevitably ends in extravagance when a Conservative Government is in office. This is not the first experience we have had of this. It is not many years ago since Lord Randolph Churchill resigned because he could not introduce economy, and the present Chancellor of the Exchequer has retained his office only at the cost of surrendering position after position to the assaults made upon him from his own side of the House against what they are pleased to term the parsimony of the Treasury. If there had been a different result of seven years of Conservative government, I should certainly have been very much surprised. Hon. Gentlemen may call it a prejudice, but it is a prejudice I hold very strongly, that when a Conservative Government is in office you will have increased expenditure and increased taxation. If, after seven years of this Government, we had had reduced taxation and an annual surplus, I should be wrong in my belief or prejudice—call it which you please. But our expectations have been realised, and realised in a way which is most painful to the people, by the re-imposition of a tax on their food. If we consider this Budget in the light of recognising that the bread tax, the sugar tax, and the coal tax are to be permanent, is this House prepared to accept it? We have heard very much of the cant phrase of widening the basis of taxation. There is only one basis of taxation—the taxpayer; and widening the basis of taxation, in the mouths of those who use the phrase, only means that they wish to transfer the burden of taxation from the comparatively well-to-do to the shoulders of the less well-to-do taxpayer. There is no other meaning in it. What is the prospect which this widening of the basis of taxation offers to us? When, next year, and every successive year, the Treasury gapes wider and wider, how can we not expect that the Chancellor of the Exchequer will build on this new basis of taxation, and that the ½d. on sugar will become 1d. and the 1s. on corn 5s? If this corn tax were in truth only to he a temporary tax, a war tax, as appeared to be suggested by the Chancellor of the Exchequer at an earlier stage in this debate, then it would be contrary to the admirable principle laid down by him in words which I will quote—

"I do not think it wise to make small changes in our system of taxation, which, even if defensible in themselves, would harass and disturb the complex and delicate fabric of our trade."

This is a small change in our system of taxation. It will harass and disturb the complex and delicate fabric of our trace, and all for the sake of bringing in £2,500,000 in a Budget of £153,000,000. Is it worth it, if the tax is to stand alone? But if this tax is to be the basis on which the right hon. Gentleman may build in the future, if it is to be the easiest and readiest means of bringing in revenue, then we have to deal with it in altogether another way. Our judgment on this Budget must depend largely on whether we recognise and believe that it is a permanent Budget, and whether this new imposition is going to be made to press in the future still more heavily on the people. I dread this tax for its present hardship; I dread it far more because of the temptation it will offer to future Chancellors of the Exchequer to increase that hardship; and I am not in the least reconciled to it by the only argument offered by the Chancellor of the Exchequer in its defence that thirty-three years ago another Chancellor of the Exchequer, with the approval of the nation, thought it wise to repeal it. We are told that money must be found somewhere. We on this side of the House have long held the view that the Exchequer could be enriched by the retention of certain revenues now-handed over to local authorities if local finance were buttressed by the rating of ground values, and as my hon. friend the Member for Dundee has suggested a profitable revenue might be raised from the sale, instead of the free grant, of licences. These are two sources of revenue which would supply our immediate wants, but the one permanent remedy for taxation lies in economy of administration. We shall never get that as long as the present Government remains in office, let the Chancellor of the Exchequer strive as he may. Experience, the best of all guides, has shown us during the last century that when that Party is in office we get increased taxation and extravagant expenditure. If we are to make our finances balance, and be in a position to repeal taxation, we must revert to the principles which still survive on this side of the House—the principles of economy in finance and efficiency in administration—which do not mean "running the Empire on the cheap." They have made this great Empire, with its magnificent resources, resources now, unhappily, so rapidly squandered by hon. Gentlemen opposite, which were inherited from the great work done by the Liberal administrators of the past.

The hon. Member has favoured us with a general review of the past expenditure of the country and a prophecy of the future of our finances. He has taken a view which is very common on his side as to the causes of our expenditure. He is good enough to credit me with a desire for economy, and with so much, at any rate, of usefulness in my present position that he would sooner see me Chancellor of the Exchequer than anybody else on this side of the House. But he considers that I am overborne by my colleagues and political friends, and that in spite of myself the expenditure has grown to its present proportions. I will only say that the views of the hon. Member on this subject are entirely unfounded. If I had not concurred in the expenditure, I should not now be standing at this Table. I concurred in it because I believed it to be necessary. I have resisted many proposals of which the hon. Gentleman says nothing, but those proposals have not by any means always come from my colleagues or from those on this side of the House. Time after time in the course of the past six years proposals of various kinds for increased expenditure have been made by hon. Members sitting on the opposite side—proposals for additional pay or pensions for Civil servants, for Post Office and Dockyard employees, as well as additional grants for education of all kinds; and even today we have heard it suggested that the whole cost of education ought to be defrayed by the Exchequer. In the course of the last few weeks my hon. friend representing the Post Office in this House has had to resist the claim, urged with almost complete unanimity, for some great expenditure on the telegraphic service to Scotland, which would have been another addition to the Budget of the present year. We are blamed by the hon. Member for all the expenditure of the country, as if it were entirely our fault. He admits that the country has had a magnificent revenue; he admits that the revenue has largely increased in the past few years. But that, of course, is not to our credit; that is to the credit of those who sit on the Benches opposite. I will not detain the House by going further into that argument, because I know they are anxious to conclude this debate. But this I may say with regard to the future. The hon. Member has been good enough to sketch out for me, or for some one else, a Budget when the war is over and the time for a reduction of taxation has come; and he has propounded a theory that I have made up my mind to reduce certain taxes, to retain others, and, in fact, that I have practically settled now what the Budget will be next year. I can assure the hon. Member that I have not been guilty of such a foolish anticipation. When the war is over—and we hope it may soon be over—and when the time comes for a reduction of taxation, then also will come the time for a full consideration of the whole financial position of the country, and the burden on the taxpayers generally, what shall be decreased and what shall remain. There are two speeches in regard to which I will venture to say a few words. The hon. Member for Barnsley hovered over any number of subjects in connection with taxation. He began by dealing with the whole fiscal system of the country, and suggested that we ought to impose a charge on the Cape and Natal by way of contribution to the expenses of the war. Then he went on to discuss a graduated income tax, a penny on share certificates, finally settling down on what I think was the real object of his speech—the coal tax. He asked me to reduce the coal tax in the present Budget. I cannot consider the reduction of taxation, and I am certain that another year ought to elapse before any one can tell what the effect of the coal tax may be. I was glad to find that the hon. Member did not suggest the abolition of the tax. He suggested that the shilling export duty on coal had rather stimulated the export of coal in the first three months of the present year, and, that being so, it should be altered——

What I said was that the increased export of coal to foreign countries was due to the fact that the demand had so decreased at home that we were driven to push our foreign trade, in spite of having to accept 1s. less than we would otherwise have obtained in consequence of the coal tax, in order to keep the collieries going.

He went on to suggest that I had better increase the home demand by putting 2d. a ton on all coal extracted from collieries in this country. I am glad to receive such a suggestion from one who is closely connected with the coal industry with regard to the possibilities of the future. The hon. Member for Dundee raised important questions connected with our general system of taxation. The hon. Member objects, I think I may say, to all indirect taxation except—

I made no such discrimination.

He objects to indirect taxation altogether.

I did not say that.

The whole purport of his speech was that he objected not only to the tax on corn, but also to the taxes on tea and sugar, and the income tax. He would largely lower these by adopting certain other proposals which he explained. What were those proposals? In the first place, he called attention to the position of our self-governing colonies, and suggested that we should obtain a contribution from them towards the expenses of the defence of the Empire. I should be glad to see some arrangement of that kind made. I think the House generally are aware that this will form one of the subjects of discussion at the forthcoming conference in the present year. But I do not think the hon. Member seriously meant that it rested with me, as Chancellor of the Exchequer of the United Kingdom, to attempt to tax the self-governing colonies. Then the hon. Member went on to talk about the "doles," and suggested that we should deprive the occupiers of agricultural land of the relief of rates which they enjoy, in order to devote the money to the national expenditure. That is not a matter on which I shall dwell today, for I am sure it will be a long time before any Government will attempt to make such a proposal. He then suggested that we might obtain a considerable revenue from ground values, entirely ignoring the minority Report of the Local Taxation Commission, which certainly pointed out most plainly that, although you might alter the incidence of rating on ground values and houses, so as to make the owner pay more, and the occupier less, whatever you gained must practically go towards the relief of local taxation. The hon. Member further suggested that a large revenue might be derived for Imperial purposes from the licence duties, forgetting again that these duties under one form or another, are now handed over to the local authorities, and that they certainly would not give them up.

The existing duties are handed over, but the additional duties need not be.