To ask the Secretary to the Board of Education if the Board or the Consultative Committee is at present considering the question of registration of teachers in technical institutes; and, if so, will the Board, before coming to a decision on the matter, acquaint the association of such teachers of the proposals or the terms of the draft scheme. (Answered by Sir William Anson.) The matter is at present under the consideration of the Consultative Committee; until the Report of the Committee is before the Board it would not be possible for me to state what course the Board will follow as to communications to persons who may be interested in the subject of the Report.

To ask the Lord-Advocate if he will state when the Report of Lord Mansfield's Commission will be laid upon the Table of the House, and the cause of the delay. (Answered by Mr. Scott Dickson.) The Secretary for Scotland is informed that the Report will be sent to him on a very early day, and will, in due course, be laid upon the Table of the House.

To ask the Secretary of State for the Home Department whether his attention has been called to the fact that the coroner for South West London and City of Westminster is in the habit of employing a pathologist to determine the cause of death, in preference to the medical practitioner last in attendance on the deceased; and will he state why the practice adopted by other coroners throughout the country is departed from by the coroner for this district. (Answered by Mr. Secretary Akers-Douglas.) I have had under my notice certain statements made with regard to the procedure at inquests held by the coroner in question, but I do not know how far these statements are accurate; and, in any case, I have no authority to interfere with the discretion of a coroner in the conduct of inquests.

To ask the Secretary of State for the Home Department if he will state the number of aliens naturalised in each of the years 1890 to (and inclusive of) 1904. (Answered by Mr. Secretary Akers-Douglas.) The number of persons whose oaths of allegiance, taken on the grant of Certificates of Naturalisation in the United Kingdom, have been registered from 1894 to 1904, are as follows:—

Year.	No. of Persons naturalised.
1894	910
1895
1896	736
1897	606
1898	634
1899	608
1900	581
1901	542
1902	788
1903	890
1904	974

The figures for previous years were not kept in a similar form, and are not readily available for purposes of comparison. They included the few cases in which persons have been naturalised by special Act of Parliament, but did not include

Year	Net Contributions as Shown in the Financial Relations Returns.
	England.	Scotland.	Ireland.
	£	£	£
1895–6	60,140,000	7,292,000	2,096,000
1899–1900	69,540,500	8,660,000	1,684,500
1903–4	82,808,500	10,149,000	2,200,500

those women and children who have become British subjects through the naturalisation of their husbands or parents.

To ask the Secretary of State for the Home Department if he will state how many of the alien immigrants who arrived in London during March and April were reported by the Medical Officer of Health for the Port of London to be suffering from infectious or contagious diseases; and what were the diseases of the immigrants so reported. (Answered by Mr. Secretary Akers-Douglas.) I am informed, on making inquiry of the authorities of the City of London, that the following cases of alien immigrants suffering from infectious or contagious diseases wore reported by the Medical Officer of Health of the Port of London during March and April:—

March	One case	Erysipelas.
April	Five cases	1 Chicken pox.
		1 Measles.
		3 Enteric fever.

To ask the Secretary to the Treasury if he will state the net contribution to Imperial Expenditure of England, Scotland, and Ireland, respectively, for the years 1895–6, 1899–1900, and 1903–4. (Answered by Mr. Victor Cavendish.)

To ask the Secretary to the Treasury if he will state the total amount paid by the Treasury each year to the local authorities under the Agricultural Rates (England) Act, the

To ask the Postmaster-General whether he is aware that the local secretary of the Postmen's Federation at Faversham, Kent, has been cautioned because of his conduct in forwarding a petition regarding a matter in which he was not directly concerned; and

To ask the Postmaster-General whether he is now in a position to announce his decision regarding the classification and maximum of provincial, town, and sub-office postmen. (Answered by Lord Stanley.) As the hon. Member is aware, the new scales of pay for provincial postmen were announced to the staff at the end of March last, and are already in force. I am daily receiving applications from the postmen at different offices for changes in the classification of their offices, and each case is being dealt with on its merits as quickly as possible.

To ask Mr. Chancellor of the Exchequer whether Mr. Moynihan, veterinary surgeon, Kanturk, county Cork, is now threatened with arrest for non-payment of income-tax; and, if so, whether, in view of the fact that he is in receipt of only £50 a year from the county council and has no other professional income except from a few precarious cases, the income-tax authorities will abandon their intention of taking this course. (Answered by Mr. Austen Chamberlain.) If Mr. Moynihan will establish the fact that his total income does not exceed £160, the Crown's claim against him for income-tax will be discharged. But up to the present time, I understand, he has declined to offer any evidence on the point, and has ignored every communication made to him on the subject. As a consequence proceedings were entered upon for the recovery of the duty assessed upon him, and judgment has been obtained in the High Court for tax and costs. In these circumstances the Board of Inland Revenue cannot intervene on his behalf, unless he will place himself in communication with them, and put them in possession of the facts of his financial position.

To ask Mr. Chancellor of the Exchequer if he proposes to readjust the existing Excise Duty on chicory, to place the home grower on the same footing as the foreign producer. (Answered by Mr. Austen Chamberlain.) I propose to deal with this subject in the Revenue Bill which I hope to introduce shortly.

To ask the Secretary of State for India whether the Maharaja of Kashmire has made representations to the Government of India with reference to the establishment of a college at Srinagar; whether the British Resident has refused to sanction this proposal; and, if so, whether he will state the grounds upon which the objections of the Resident are based. (Answered by Mr. Secretary Brodrick.) The Answer to the first two Questions is in the negative.

To ask the Secretary of State for India whether it is proposed to grant a medal to the Aden Frontier Force. (Answered by Mr. Secretary Brodrick.) As I informed my hon. and gallant friend on February 22nd† last, it is not proposed to grant a medal to the Aden Hinterland Delimitation Commission escort, as the military authorities, who have again been consulted, do not recommend it.

To ask the Secretary of State for India whether any protest has been received from or sent by the Government of India against the Bill now before the Cape Parliament which renders His Majesty's Indian subjects, resident in Cape Colony, liable to a trading disability which will not be inflicted upon Yiddish-speaking aliens; and whether the Government of India has protested against similar legislation in the Colony of Natal. (Answered by Mr. Secretary Brodrick.) The Answer to the first paragraph of the Question is in the negative. The legislation of 1897 in Natal, which requires

† See (4) Debates, exli, 893.

traders to keep their account books in the English language, formed the subject of protest by my predecessor when the measure was under consideration. It does not appear, however, to have interfered with the expansion of trade by Indians in that Colony. The law does not require the books to be written up by the trader himself.

To ask the Chief Secretary to the Lord-Lieutenant of Ireland whether Constable Adams, now stationed at Bray, has been promoted to the rank of acting sergeant, and is about to be appointed to the charge of Newtownmount Kennedy Police Station; and will he say what is his length of service; how many unfavourable records he has, and was he ever cautioned because of infringement of the rules of the service, and informed that he would never get any advancement in the service because of the breach of such regulations; and were representations made to the commandant, and, if so, by whom, with a view to obtaining promotion for this man. (Answered by Mr. Walter Long.) The reply to the first inquiry is in the affirmative. The constable has nineteen years service. He has never been informed that he would not receive advancement. The promotion was made by the Inspector-General, in the usual course, on the recommendation of the local officers.

To ask the Secretary of State for the Colonies if he will state what were the offences in respect of which 332 Chinese labourers were repatriated up to December 31st last; what penalties, in addition to repatriation, were inflicted; whether all or any portion of the wages earned by such labourers was withheld or deducted; and whether such repatriated labourers were merely returned to the port of shipment, or if any means were afforded them of returning to their own homes. (Answered by Mr. Secretary Lyttelton.) The great majority of labourers repatriated were probably returned as medically unfit, but I have no precise information beyond what has been published, and I will make inquiry. Meanwhile, reference may be made to the Ordinance (see pages 16 and 17 of Cd. 2026) and the Contract (see page 10 of Cd. 2183).

To ask the Secretary of State for War the total number of workmen discharged from Woolwich Arsenal and Enfield Small Arms Factory since June, 1903, for causes other than misconduct.Answered by Mr. Secretary Arnold-Forster.) The total number of workmen in the Ordnance Factories discharged on account of age, illness, or other causes except misconduct is as follows:—

From June, 1903, to May 6th, 1905—
Woolwich	2,363
Enfield	1,019

I beg to ask the Secretary of State for War whether, when the proposed changes in the organisation of the Militia shall have come into operation, subaltern officers of that force will have the opportunity of qualifying for all new conditions of service, so as to be able to continue serving under the new system, if duly qualified.

In the event mentioned the claims of any duly qualified Militia subaltern officers will receive full consideration, and every encouragement and opportunity will be given to officers to continue their services.

I beg to ask the Secretary of State for War whether his attention has been called to the recent accidental shooting of a fisherman (George Thomas Gilson) by the Royal Garrison Artillery off Sheerness; if so, what steps he proposes to take to prevent the possibility of such accidents in the future; and whether compensation will be made to the widow.

A report of this case has been forwarded to the War Office by the General Officer Commanding concerned, who stated that he had issued orders to give a longer safety range during practice with one inch aiming rifles. The question of the length of safety range which should in future be fixed for such practice will receive careful consideration. As regards compensation, the question of an award as an act of grace is being considered.

I beg to ask the Secretary of State for War if rifle clubs are entered and numbered on the books of the War Office, and form an integral part of the scheme of national defence; and if, in view of the fact that the members pay for rifles, ammunition, watchers, and markers, it is intended during the coming season to charge them rent for the use of Government ranges.

Rifle clubs which are affiliated to the National Rifle Association are entered and numbered on the books of the War Office. They do not form an integral part of the scheme of national defence. A rent of 1s. a member per annum is charged in respect of the use of the ranges.

Were rifle clubs regarded as part of the system of national defence when the right hon. Gentleman promised a grant, of £50,000 per annum in aid of them.

They were not intended to form part of that organisation.

I beg to ask the Secretary of State for the Colonies if he will state what were the circumstances which led to the outbreak of Chinese labourers at the Van Ryn Mine in the Transvaal on 14th May; what casualties resulted; and how many persons have been arrested in connection with this disturbance.

I have no information regarding the outbreak referred to, the facts as to which will no doubt be reported in due course.

I beg to ask the Secretary of State for India a Question of which I have given him private notice, viz., whether the text of the treaty with Afghanistan, published in The Times this morning, is accurate, and when the official copy will be distributed to Members.

The text of the treaty, as published in The Times, is, as far as I know, substantially accurate. The distribution of copies will take place in the course of the next two or three hours. The Paper was laid on the Table last night, and was, therefore, accessible to Members in the Vote Office. But no copy was sent to any newspaper.

I beg to ask the Under-Secretary of State for Foreign Affairs if his attention has been drawn to the decision of a Russian Naval Court in the case of the "Calchas," which appears to define cotton as being contraband of war; and whether, seeing that the proportion of cotton used for military purposes is quite insignificant and could be easily replaced for warlike purposes by some other vegetable fibre, and that cotton is largely used for clothing in this country and constitutes an important branch of manufacture, under these circumstances the "Calchas" decision will be allowed to pass without protest.

His Majesty's Government have as yet only received a brief telegraphic summary of the decision. When the full text of the judgment is received they will consider whether any further action is desirable. As the hon. Member is no doubt aware, His Majesty's Ambassador at St. Petersburg has already brought the question of the treatment of raw cotton to the notice of the Russian Government in his note of October 9th last.

Is seaweed which is used for manuring purposes also contraband of war?

I beg to ask the Secretary of State for the Home Department whether he can state the names of the ports to which he proposes to apply the provisions of the Aliens Bill.

The present distribution of the wholesale immigrant traffic indicates that this machinery should in the first instance be set up at London, Grimsby, Hull. Newhaven, Southampton, the Tyne, Leith, and Harwich. In addition to these it will probably be required at Liverpool, and may perhaps be required at some other Western port, but as to this latter point I am not yet in a position to make any statement.

Are Dover and Folkestone to be excluded?

It is not proposed in the first instance to set up special machinery at Dover and Folkestone. The Board of Trade Returns do not show that it is necessary there.

I beg to ask the Postmaster-General whether, in view of the fact that the Tweedmouth Committee recommended that full time adult service in an unestablished capacity (other than that of learner) should be awarded good conduct stripes, he will consider the advisability of granting this privilege to adult night messengers on the same conditions as given to postmen.

The hon. Member is under a misapprehension. No such recommendation was made by the Tweedmouth Committee. As I stated in answer to a Question in this House on the 27th of July † last, I am not prepared to grant the privilege of good conduct stripes to adult night telegraph messengers.

What is the object of refusing this small concession?

I am afraid I cannot deal with that by means of Question and Answer in this House.

I beg to ask the Postmaster-General whether his attention has been drawn to the fact that all communications in connection with rent-fixing are delivered post free to the Irish Land Commission, whilst similar communications addressed to the Country Court must be postage paid and stamp enclosed if reply is required; and whether equal postal facilities will be provided in the County Court.

The Irish Land Commission is a public office which is entitled by Treasury authority to send and receive letters on public business on which postage has not been prepaid. It would not be practicable to extend the same privilege to County Courts.

I beg to ask the President of the Board of Agriculture whether he can state, for the week ending May 13th, the number of cases of outbreak of swine fever in England, Wales, Scotland, and Ireland respectively.

† See (4) Debate, cxxxviii., 133..

During the week ended May 13th there were twenty-three outbreaks of swine fever in England, two in Scotland, two in Wales, and one in Ireland.

Cannot the right hon. Gentleman see his way, now that swine fever has practically ceased to exist in Ireland, to withdraw the removal orders now in force?

was understood to reply that if the local authorities took certain action he would be prepared to consider the matter.

I beg to ask the President of the Board of Agriculture whether he will postpone beyond 1st June the operation within the scheduled area in Scotland of the Sheep Scab (Regulation of Movement) Order until the local authorities within the area submit to him proposals which they believe will be effective for the prevention of the disease.

As will be seen from a communication which I sent to the Press yesterday, I have agreed, in response to the request of a deputation of Scottish flockmasters which waited on me on Saturday last, to postpone the operation of the Order in question until after the 30th of June, in order to allow time for the elaboration of a scheme to secure the compulsory dipping of all sheep within the scheduled area under conditions such as would justify me in contemplating the removal of the restrictions on the movement of sheep which are imposed by the Order referred to in the hon. Member's Question.

I beg to ask the President of the Local Government Board whether he has considered the decisions given in the cases reported in Knapp and Omblus election cases, pages 114 and 320, and O'Malley and Hardcastles reports of decisions in election petitions, page 161, in all of which it was held that money given as a loan by the Poor Law authorities on the understanding that it be repaid was held not to be relief which disqualified a I voter, and that in both cases the vote was allowed; and whether these decisions regulate the giving of relief to destitute school children when such relief is to be considered as a loan to the parent.

:I am aware of the cases to which the hon. Member refers. They do not relate to the question of the disqualification for being registered as voters of persons who have received relief on loan under the Poor Law Amendment Act, 1834, and I am advised that they would not apply to any such disqualification in cases arising under the Relief (School Children) Order, 1905.

I beg to ask the President of the Local Government Board whether he can state the number of county boroughs in England and Wales in which unemployed bodies would be compulsorily established (unless exempted by an Order of the Local Government Board) by the Unemployed Bill now before the House, and the circumstances under which an exemption order would be granted.

The number of county boroughs in England and Wales is seventy-one. A local body would be established under the Bill for each of them unless in any particular case the Local Government Board postponed its establishment until the town council resolved that circumstances rendered the establishment of a local body desirable. Postponement could only be effected on the application of the town council, who would no doubt state the circumstances on which the application was based. It cannot be stated beforehand what the circumstances I would be. They would presumably vary in different cases.

I beg to ask the Secretary of State for the Home Department whether, in view of the recent and continued loss of life through the recklessness of motorcar drivers, he will consider the advisability of introducing legislation to place it within the discretion of magistrates to impose a term of imprisonment for a first offence.

My right hon. friend has asked me to reply to this Question. The Motor-Car Act expires at the end of 1906, and I will take note of the suggestion of the hon. Member with a view to its consideration before that time.

I beg to ask the Secretary to the Board of Trade to what extent has the price of sugar fallen during this year; what is the present price; what is the price now quoted for delivery during the last quarter of the present year; and what was the average price of sugar during the ten years prior to the signature of the Brussels Convention.

The price of 88 per cent. beet sugar f.o.b. Hamburg at the beginning of January was 14s. 10d. per cwt., and this had increased by the middle of January to 16s. The price on the 18th May was 11s. 7½d. The price quoted on the 18th May for delivery in November—December was 9s. 11d. The average price of the same sugar in the ten years 1892—1901 was about 10s. 9d. per cwt.

Is the hon. Gentleman aware that since the Sugar Convention the retail price of sugar has doubled, and that the same sugar that was sold at 1¼d. a pound before the Convention is now sold to the same people by the same tradesman at 2½d. a pound?

I am not aware of it, and I would like to know if it is so.

I can assure the hon. Gentleman that it is within my own knowledge that the fact is so at King's Lynn.

I beg to ask the hon. Member for Chorley, as representing the First Commissioner of Works, whether he will consider the feasibility and cost of an apparatus to change the colour of the light on the Clock Tower as soon as a division is declared, the changed colour to remain until doors are unlocked, so as to inform Members approaching the House that a division is taking place.

The appliances needed to carry out my hon. and gallant friend's suggestion would be either very costly or difficult of manipulation. It does not appear to the First Commissioner that he would be warranted in adopting the proposal.

Will the noble Lord consider as to placing a gong or bell in Parliament Yard. We have great difficulty in hearing when a division is called.

Would it not be better to fire off a gun?

I beg to ask the Lord-Advocate whether he is aware that the City of Glasgow expended £12,000 during the past winter in finding work for the unemployed of the city and whether, seeing that neither under the Poor Law of Scotland nor under the Municipal Acts has any public authority power to deal with or give relief to the able-bodied unemployed, and that the unemployed difficulty is becoming increasingly serious in Scotland, he proposes by the appointment of a special Committee or otherwise to inquire into the amendments required in the law to confer powers upon the local authorities for dealing with unemployment, as is proposed to be done for England and Wales in the Bill now before the House.

I am aware of the facts referred to by the hon. Member in the first part of the Question. The whole matter is having the attention of the Secretary for Scotland, but I cannot at present make any definite statement as to the course which is to be taken.

I beg to ask the Chief Secretary to the Lord-Lieutenant of Ireland whether his attention has been called to the statement on page 40 of Mr. Dale's Report, that the condition of the English Department of any grant being made to a school, that girls must be satisfactorily taught needlework, has not existed in Ireland, and that there are 780 schools, with a mixed attendance of boys and girls, under a master only, and that in these schools the infants are unsuitably taught, but the girls are necessarily deprived of all instruction in needlework or any other domestic subject; if so, can he say why the Commissioners, in their Annual Report which has recently been issued, offer no explanation in defence of the state of things which Mr. Dale's complaint exhibits as existing in these schools; whether they intend to permit the teaching by men only, not only of boys under eight years of age, but of infant girls and grown girls; and, if not, what steps they propose to take in the matter.

The Commissioners allude, in their last Annual Report, to their desire for the extended employment of manual instructresses, who have been introduced into many small mixed schools with beneficial results. These instructresses might be employed in all the schools referred to in the Question. The rules provide that, in a mixed school under a master, an assistant mistress should be employed when the attendance warrants it, and that a manual instructress may be employed when the attendance is insufficient for an assistant mistress.

Will the right hon. Gentleman consider the propriety of publishing the observations of the Commissioners on Mr. Dale's Report?

I will communicate the hon. Member's wish to the Commissioners.

I beg to ask the Chief Secretary to the Lord-Lieutenant of Ireland whether he can state what number of the 780 schools, referred to in paragraph 133, page 40, of Mr. Dale's Report, are under Catholic, Episcopalian Protestant, and Presbyterian management respectively.

Three hundred and sixty-seven under Catholic management; 251 under Irish Church management; and 140 under Presbyterian management.

I beg to ask the Chief Secretary to the Lord-Lieutenant of Ireland whether Form P under The Land Purchase Act, 1903, is an agreement or undertaking between the tenant of a holding and the Estates Commissioners, and not an agreement between the tenant and his landlord; whether he is aware that landlords, agents, or their solicitors are using Form P and getting tenants to sign same and agree to purchase terms where the estate is to be sold to the Estates Commissioners, said agreement being signed by the tenant before the estate is offered for sale by the landlord to the Estates Commissioners; and whether he will take steps to secure that landlords, agents, or their solicitors shall not use Form P in such a way as to debar the tenants from any benefits which they otherwise might receive from a direct sale by the Estates Commissioners to the tenants.

My right hon. friend has asked me to reply to this Question. Form P is an undertaking by the tenant to the effect that, in the event of the sale of the estate to the Land Commission, he will purchase his holding from the Commissioners at the price named. This undertaking is entered into with a view to the sale of the estate to the Land Commission under Section 6, and is conditional on that sale being effected; and if the hon. Member will refer to Section 6 he will see that it would be almost impossible that the conditions in that section could be fulfilled unless some preliminary negotiations of this kind were entered into. I am not aware whether landlords or agents are acting in the manner mentioned, but as Form P is provided for a particular class of cases, the Estates Commissioners may be trusted not to permit it to be used in cases to which it is inapplicable, or to the prejudice of the rights of the tenants. It is not necessary to make any regulation dealing with the matter.

Do not the landlords who use this form get the tenants, to agree to certain prices before the estate is offered to the Estates Commissioners?

Some preliminary negotiations are, of course, necessary to enable the Commissioners to do the things specified in the section.

But having got the tenant to sign the agreement, is it not the case that the landlord may proceed against him for the old rent?

The whole thing is conditional.

But the tenant has no protection against the landlord or his agent.

I beg to ask the Chief Secretary to the Lord-Lieutenant of Ireland whether he is aware that the toe of the slip at Boatcove, Glen, county Kerry, is still unfinished, and whether steps will be taken by the Congested Districts Board to complete this work without delay; and will the Board supply the hon. Member for South Kerry with a detailed specification of the proposed breakwater at the Glen, together with their estimated cost of erection.

The Board have expended £361 on this boat slip, and they are doubtful whether the small advantage to be gained by lengthening it would justify any additional expenditure. They will, however, have a further inspection made when opportunity offers. It was never the Board's intention to construct a breakwater at this place.

I beg to ask the Chief Secretary to the Lord - Lieutenant of Ireland whether any, and if so, what vessel is watching the observance of the fishing laws on the south-west coast; whether he is aware that several steam trawlers were near Ballinskelligs, within the prohibited limits, between 7th and 14th May, and that the local fishermen had to haul up their nets fearing they should be damaged by the trawls; and whether, seeing that two steamers are required for the adequate protection of local interests during the next two months, he will take steps to secure their constant supervision of the south-west coast.

The Department's steam cruiser "Helga" patrolled the Kerry coast between the dates mentioned, but found no steam trawlers within prohibited limits. The supervision of the south-west coast will not be lost sight of, but for obvious reasons the position of the vessels engaged on the duty cannot be advertised beforehand.

I beg to ask the Chief Secretary to the Lord-Lieutenant of Ireland if he can state on what grounds the National Commissioners have withdrawn the grant from Carland National School, county Tyrone; and whether, in view of the fact that there are eighty-six children on the roll and that there is no other school within two miles, the withdrawal of the grant from Carland School will be reconsidered.

The manager of Carland School resigned, and proposed to transfer the pupils, of whom there were sixty-five on the rolls, to a new school in the locality. The Commissioners, having inquired into and considered the case, withdrew grants from Carland School, and refused aid to the proposed new school upon the ground that there was ample accommodation for the pupils in other schools under Protestant management within a reasonable distance. The Commissioners do not propose to reconsider their decision.

I beg to ask the Chief Secretary to the Lord-Lieutenant of Ireland whether the Estates Commissioners received, on November 5th, 1904, a petition signed by several of the tenants on the Mahon Ballydonlon Estate requesting to be relieved of the untenanted land which they had got upon the estate; and whether it was replied to.

A petition was received on the 6th November, 1904, asking the Commissioners to fix an equitable price on the lands of Ballydonlon, or to refuse their sanction to the sale, but the petitioners were informed that the advances had been made in April, 1904, and that the proceedings were closed.

On whose authority did the right hon. Gentleman on a previous occasion say that no application had been received by the Commission?

I have not that Answer before me or in my mind.

I have it here.

Did the right hon. Gentleman receive these two absolutely contradictory Answers from the same source?

I should not like to say they are contradictory until I have had an opportunity of examining them. The Commissioners have an enormous number of cases to deal with, and I have naturally to refer to them for information.

I beg to ask the First Lord of the Treasury if he will give facilities for the passing of the Street Betting Bill this session.

In answer to my hon. friend I have to say that I suppose his Question refers to the starring of private Members' Bills towards the end of the session. As the hon. Member knows, that is only done with Bills described as uncontroversial. I think it is too far from the end of the session to make any suggestion with regard to Bills which should or should not be starred, but from such information as I have received I think the Bill to which my hon. friend refers, and in which he is interested, is not likely to prove non-controversial.

said that it was not too much to say that this clause was the most important of the proposals which had been put before the House of Commons by the Chancellor of the Exchequer, who proposed under this section—the omission of which he (the speaker) was advocating—that £10,000,000 of Exchequer bonds, maturing in December next, and created under the Supplementary War Loans Acts, 1900, should be paid off. In considering that, it was important to realise that this proposal dealt with the Unfunded Debt, and that it did not touch the Consol debt which they had under consideration the other day. The Unfunded Debt amounted on March 31st last to £71,600,000. Of that £20,500,000 consisted of Exchequer bonds, which was the nature of the debt they were now considering, and the balance of the total was made up of war stock to the extent of £30,000,000, and of Treasury short-dated Bills to the extent of £21,000,000. It was recognised, and, indeed, it had been so considered by the Chancellor of the Exchequer, that this large floating debt was a standing menace to our financial position. Under this head, of course, came the borrowing under the Naval and Military Works Acts, and he proposed in only one sentence to draw the attention of the Committee to the fact that under that head, in 1898, the gross outstanding liabilities amounted to £3,700,000, whereas at the end of the present financial year the total would be £47,600,000. That was one reason why they should be exceedingly cautious in any powers they gave to the Chancellor of the Exchequer over the creation of new debt, which was, after all, what he was seeking to do under this clause. Another reason why they should consider this matter very carefully was to be found in the fact that the Chancellor of the Exchequer had not boldly faced the situation in regard to the national indebtedness, because last year, for the first time in our history, we increased our gross liabilities to the extent of about £2,250,000, instead of reducing them at the rate of some £7,000,000 a year. According to an Answer made by the Chancellor of the Exchequer on the preceding Monday the estimated reduction of the National Debt in the current year would only amount to a little over £3,000,000, so that it meant that for two years practically there would be no reduction whatever in the gross liabilities of the State. What did the Chancellor of the Exchequer propose to do under this Bill? He proposed to pay off £10,000,000 of Exchequer bonds. These bonds were created in 1900 by the right hon. Gentleman the Member for West Bristol when he was Chancellor of the Exchequer, and £14,000,000 would mature in December next. It was this £14,000,000 with which the right hon. Gentleman was going to deal. He was going to pay off £4,000,000 of that with money obtained from the Transvaal and from the Sinking Fund, and this particular section dealt with the remaining £10,000,000. The right hon. Gentleman, in his Budget speech, said that it was a limited funding transaction. It was a very limited funding transaction when they considered that the proposal was to pay off £10,000,000 of debt by creating £9,000,000 of new debt, for that would be the result at the end of the financial year. He did not think that that could be considered in any way a brilliant financial operation. The intention of the right hon. Gentleman the Member for West Bristol when he created these Exchequer bonds was that they were to be of a temporary nature, and he made a statement to that effect in his Budget speech of the following year, when he said—

"I have so arranged the borrowings hitherto-sanctioned by Parliament that they will mature from time to time at such intervals that it will be easy for anyone having charge of the finances of this country, if the Transvaal is in a position to give good security for a loan, to enable it to pay a reasonable contribution towards the cost of the war, and to raise a loan to be devoted towards paying off such portions of our borrowings as may be possible."

That was the intention of the right hon. Gentleman the Member for West Bristol, and he thought it was the duty of the Chancellor of the Exchequer to have dealt with the Transvaal contribution in that clause of the Finance Act. It was rather strange that while they forced the Chinese Labour Ordinance through the Legislative Council, they had delayed the Ordinance which was submitted to that Council for the purpose of raising this £30,000,000 loan, of which they were to obtain a contribution of £10,000,000 per annum for three years. He would also like to ask the Chancellor of the Exchequer what had become of the Chinese War Indemnity. The right hon. Gentleman the Member for West Bristol and the right hon. Gentleman the Member for Croydon distinctly promised that the contribution which they were to get from China in respect to the Chinese War Indemnity—estimated to amount to £6,000,000—would be applied to the reduction of the war debt. He understood that that indemnity had been transformed into an annual payment in the form of an annuity to this country, and that up to last year the payment had been devoted towards meeting the claims of private British citizens. Now, however, they would have a clear contribution, and he wished to ask the Chancellor of the Exchequer whether he intended to apply that, as promised by the right hon. Gentleman the Member for West Bristol, and the right hon. Gentleman the Member for Croydon, to the reduction of the debt. If that were so they ought to have some provision made in that clause for giving effect to that payment. He did not hesitate to say that these proposals of the Government showed a great lack of courage on the part of the right hon. Gentleman the Chancellor of the Exchequer. He had had in the present year an unique opportunity for dealing with the national indebtedness. He could have dealt with the terminable annuities which matured next year, and he ought to have dealt with the contribution from the Transvaal. He would like to point out to the Committee what he did not think had been quite realised—namely, that the gross national liability amounted to close upon —800,000,000 sterling, exactly the amount at which our debt stood in 1867 after we had discharged the new debt created on account of the Crimean War. Yet to-day they had the Chancellor of the Exchequer under this section proposing to raise another £10,000,000 of debt. That was really what it came to, because these bonds were created only for a term of five years, and now, instead of renewing them for another term of five years, the right hon. Gentleman was proposing to renew them for a term of ten years, with an annual reduction of £1,000,000 sterling which would have equally applied had he added that as contribution to the Sinking Fund. In addition to that, he had led them into this peculiar position, that they were adopting a lottery system of annual drawings, which was entirely foreign to British finance. He did not think that the Chancellor of the Exchequer could say that this proposal had given him any advantage at all from a financial standpoint. He had had to borrow at a high rate of interest. It had not reduced the rate of interest; it had not really enticed the market to come forward to take up these bonds, and he thought the right hon. Gentleman could not fail to realise that it would have been better to have renewed these bonds, and to have applied a £1,000,000 increase to the Sinking Fund. For these reasons he begged to move that the subsection be omitted.

said the hon. Member had crowded a good many curious theories into his speech, some of which he would find it hard to justify when he was sitting behind a Chancellor of the Exchequer of his own side. In his opinion the course adopted by the Chancellor of the Exchequer in regard to this £10,000,000 was a bold and not a craven course. If there had been an innovation it was one which he was rather glad to see, because the right hon. Gentleman had established a new form of Sinking Fund. It was not in any way a lottery as the hon. Member opposite chose to call it, but instead of burdening the Chancellor of the Exchequer in future years with the repayment of £10,000,000 at one time, the right hon. Gentleman had increased the service of the Debt from £27,000,000 to £28,000,000 permanently, and had allotted £1,000,000 of that to paying off one of the £10,000,000 every year, with the result that the Chancellor of the Exchequer who happened to be in office when the operation was completed would find himself with a fixed debt-charge of £28,000,000 instead of £27,000,000 to deal with, and the £1,000,000 allocated for a limited period would be freed for the reduction of the Funded Debt. The hon. Member had spoken as if the paying off of £1,000,000 a year would effectually bar the Chancellor of the Exchequer from using the Transvaal war contribution—whenever it was received—for the reduction of debt. There were more millions of Unfunded Debt to be dealt with, and many ways in which the Transvaal contribution could be applied to the reduction of debt. He was astonished to hear the hon. Member blame the Chancellor of the Exchequer for not dealing with the terminable annuities which fell in next year. Surely one of the things most to the credit of the right hon. Gentleman was that he had resisted the temptation to do so, and that he had realised that sound finance required the finance of the year to be dealt with by the resources of the year. Hs hoped the Committee would not be led away by the contradictory arguments of the hon. Member, and that they would reject his Motion by a considerable majority, thus showing that they were grateful to the Chancellor of the Exchequer for having had the boldness to initiate a new form of paying off the Debt.

was sorry that the action of the Chancellor of the Exchequer had met with the approval of the hon. and gallant Gentleman, especially after the way in which this issue of Exchequer bonds had been received in the market. It had proved; costly experiment to the Exchequer. He agreed with his hon. friend that apart from, the war debt the floating debt of the country was far too large. It was perfectly true that £30,000,000 of it ought not to be considered as floating debt, seeing that it was a war loan, but the fact remained that the floating debt was something like £45,000,000, whereas a few years ago it was but a tenth of that amount. The fact was that Treasury bills, which used to be employed merely as a means of tiding over the lean periods of the year, were now being used in place of Funded Debt because of the difficulty of raising that debt. During the war they were obliged to raise a very large amount by Treasury bills, and that was a legitimate thing to do, but big houses still carried such a large amount of the Funded Debt that it was almost impossible now to market Consols in the City of London at anything like a reasonable price. But when the Chancellor of the Exchequer told them that by issuing this form of debt he was reducing the floating debt of the country he failed to see how he was doing it. On the contrary, it appeared to him that the Chancellor of the Exchequer in this case was merely creating a new and very objectionable form of debt. It would have been far better to have added this £10,000,000 to some existing form of debt than to have created a new form which was less marketable in the City. The hon. and gallant Member opposite objected to the phrase lottery loan. That phrase was very rightly used of the transaction by the hon. Member for King's Lynn the other day. It was obviously nothing but a lottery loan, and it was not a very dignified position for the Chancellor of the Exchequer of this country to take up to issue a form of loan of the kind. It might be very well for a third-rate South American Republic, but it was certainly not the kind of debt which ought to be undertaken by a great country with a credit such as we possessed. A lottery loan was a very expensive article; it was not suitable for City purposes, neither was it suitable for the permanent investor, who wanted to know definitely what rate of interest he would receive and when he would be repaid. Then with regard to the City of London, bankers, insurance companies, bill brokers, and discounters were those who chiefly took up Exchequer bonds. Did the Chancellor of the Exchequer imagine for one moment that they liked this gambling transaction? No, they too preferred to know the exact rate of interest and the exact currency of the obligation. When they knew where they stood they were willing to pay the best market prices for an article when guaranteed by the Government, but when uncertainty prevailed as to the time of repayment they were not likely to run the risk for the same amount of money. The result had been that the Chancellor of the Exchequer had had to pay 3⅛per sent., whereas he might have got the money on Exchequer bonds at 2⅞per cent.—a very considerable difference indeed. That was not what he called wise finance, and he hoped that in case of future necessity the right hon. Gentleman would profit by the experience of the past and not seek to raise money in so expensive a way or in a manner incompatible with the dignity of a great country.

replying first to the Question of the hon. Member for East Edinburgh as to the Chinese war indemnity and the Transvaal war contribution, said that the earlier receipts in connection with the Chinese indemnity had been wholly devoted to the payment of private claims, delay in which might involve great hardship to individuals. He hoped a point had now been reached when some satisfaction would be received year by year on account of the Government claim. The exact amount of the claim was still the subject of diplomatic negotiation, and he did not think he could make definite proposals to the House until those negotiations had come to a conclusion. But he would say at once in the most positive form, in order to remove the anxiety of the hon. Member, that, in his opinion, whatever we might recover on that account ought undoubtedly to be devoted to the reduction of the Debt, and it was to that purpose that, so long as he was responsible, he would take care that it was applied. If anything was received on that account before he was able to explain the situation in full to the House and make definite proposals on the subject, the money would be held on suspense account until it could be applied to the reduction of the Debt. There need be no apprehension that he would be tempted to apply that money in relief of taxation or payment of the ordinary current expenses of the year. The money ought, undoubtedly, to be applied to the reduction of the Debt

Am I right in assuming that during the last two or three years we have received £300,000 a year, that that has been applied to the satisfaction of British claims, and that they have now all been met.

said he was speaking from memory, but he thought that until very recently the whole of what we had received had been devoted to the satisfaction of private claims. He believed there was at this moment a sum of money in our hands which had not been required for the satisfaction of those private claims but he also believed that the whole of the private claims had not yet been satisfied. The claims of individuals had been satisfied, but there were railway claims outstanding to which the same conditions did not necessarily apply as applied to the individual claims. By the former he meant the cases in which hardship would be caused to individuals if they did not receive their money at once. Probably the railway need not receive the full satisfaction of their claims at once, but might share with the British Government in the payments that now became due. At any rate, whatever money now accrued to the British Government would go to the reduction of the, Debt. As regarded the Transvaal war contribution he had already explained in his Budget Speech the position of the Government, and he thought it would serve no useful purpose to go over the ground again. He agreed with the opinion to which expression had been given by the right hon. Gentleman the Member for West Bristol, that further discussion of the matter at the present stage was not likely to be conducive to the public advantage, or to facilitate the recovery of the contribution. The hon. Gentleman the Member for Edinburgh had accused him of great lack of courage in dealing with the Debt, and of failing to take advantage of a great opportunity. A number of terminable annuities would fall in next year, and he understood that the contention of the hon. Gentleman was that he ought to have anticipated the falling-in of those annuities, and this year set up fresh annuities to cancel a further amount of debt. He was at a loss to conceive why the hon. Gentleman considered that that would have been a more courageous course than he had actually followed. If he had proposed to reduce the Sinking Fund or the amount of money available for the reduction of debt, he could have understood the charge of lack of courage, but he had taken exactly the opposite course. The operation which he was blamed for not undertaking was a purely paper transaction, which would not in fact reduce by one penny more than his own proposals the liabilities of this country or the amount of its debt. He had not thought it any part of his duty to anticipate what the Chancellor of the Exchequer might think fit to do next year. What he did think was a part of his duty—a duty which he had attempted to discharge—was to strengthen the provision made for the reduction of the Debt, but he did not think it would be wise to prejudge the decision of the Chancellor of the Exchequer next year as to whether the amount we had available for that purpose should be applied in one particular way rather than another. What it was expedient to do in a matter of this kind must depend on the circumstances existing at the time the operation had to be performed. He thought hon. Members were occasionally misled by the opinion that there was some peculiar sanctity about terminable annuities of this kind, and that a sinking fund wrapped up in terminable annuities was protected against interference or raiding by the House of Commons or the Chancellor of the Exchequer in a way that no other sinking fund was. They did not, in fact, afford any additional security. That view was confirmed by the fact that during the recent war in South Africa the House consented to suspend the whole of the Sinking Fund.

said it was only that part which was held by Government Departments.

said he thought the hon. Gentleman was in some confusion of mind. Life annuities, granted to individuals, constituted a contract between the State and the individual which could not be interfered with. But those were not the annuities about which the hon. Gentleman was talking. They were not affected in any way by the proposals which the hon. Gentleman brought before the Committee; of course the free operation of the Sinking Fund was really their first reserve. As to the allegation that he was not reducing the Debt at all, but, on the contrary, increasing it, if he reborrowed the same amount of money to pay off an old loan he did not increase the Debt, though if that were the whole operation he would not diminish it. But that was not the whole operation, and he had taken steps to diminish the Debt. The hon. Gentleman did not approve of the steps he had taken, and said that it would have been much better if he had renewed the bonds for five years. He had power to do that under the Exchequer Act, which gave power to raise money by Exchequer bonds not merely for the purposes of the Act, but for paying off sums raised under that Act. But the War Stock bonds stood on a different footing to those Exchequer bonds, although these Exchequer bonds were raised for the purpose of the war. The phraseology was necessarily confusing, and it was difficult to make his point clear, especially when hon. Members seized that particular opportunity to raise points which really were not germane to the particular matter under consideration.

(who had interjected the remark which elicited, these observations) said he thought that according to the letter of the Act the right hon. Gentleman was justified in the statement he had made, but he doubted whether that was the spirit of the Act.

said that as a general rule they had to interpret Acts of Parliament according to the letter. If they allowed themselves to interpret the spirit according to their own inclinations, probably the hon. Member and he would differ materially as to the spirit of some Acts of Parliament. The law gave the Treasury power to reborrow ad infinitum for the purpose of paying off debt. Having once raised money on Exchequer bonds, as soon as they fell due the Treasury could borrow the same amount again and could continue the operation to the end of time. It was indeed a complete circle which need never be broken. But it was quite clear it was not a desirable course, and it was not the intention of his right hon. friend when he passed that Act, for he hoped to be in a position by the time the bonds fell due to clear off the whole. He, however, was not in a position himself to do that, but he thought he ought to make provision to clear the bonds in a fixed and limited period and by a regular systematic process. That was really the main object which influenced him in pursuing the course he recommended to the House, and in making him select the form of security he did. There was obvious inconvenience in having so large a sum as £14,000,000 falling due on a single day unless he had reason to anticipate that about that time he would have a similar amount available for its extinction. To meet such a liability it would be necessary to accumulate money in advance, and while it was so accumulating the interest on it would be lost; or, having failed to accumulate the money in advance, it would be necessary on the day it fell due to go to the market and raise the whole sum. He need not remind hon. Members that the month of December was not usually a particularly favourable moment to go to the market for a loan. He had therefore to make arrangements in advance. As regarded £4,000,000 of the debt outstanding, he hoped to be in a position to extinguish that altogether, and as regarded the other £10,000,000 he was obliged to provide for its renewal, but he made that provision subject to the repayment of the debt by regular annual instalments within a period of ten years. The hon. Gentleman who spoke last, with great vehemence and almost passion, denounced the step he had taken as having some immoral taint about it, that it was a pure lottery unpopular with investors and with persons in the City of London, and quite unworthy of the British Government. He could only say that the British Government had not thought it unworthy of itself to issue loans with similar provisions, and the House of Commons had not thought it unworthy of the dignity of the country to sanction those loans, and had provided that in regard to municipal enterpris in certain cases exactly similar arrangements could be made.

Were these other bonds issued at par? They are not lottery bonds if issued at par.

said they were not lottery bonds whatever price they were issued at. The Egyptian Loan was not issued at par. Surely it was a gross abuse of language to describe these bonds as lottery bonds, and to suggest that investment in them was only a gambling transaction. It was no more so than an investment in Consols. What was the alternative step? If he had made a fresh issue of Consols he would have had to issue them very much below par, and he would have further depressed Consols. Houses that tendered for these Exchequer bonds had to take account of the liability of the bonds to be drawn at the rate of one-tenth each year. They had to average their tender on the assumption that the average life of a bond would be five years. It was a very simple calculation, and was in no sense a gambling transaction; and it was absurd to suggest that there was anything likely to corrupt the morals of the City or the large financial houses in Paris which dealt with millions on the same principle, or that there was anything derogatory to the dignity of the country in issuing bonds of this nature. He had been told he was not reducing the Debt by this operation at all.

The floating debt.

I am paying off £4,000,000, at any rate.

I was only referring to the £10,000,000.

said he was reducing the £10,000,000 by £1,000,000 a year instead of allowing it to go on for ever. The only question relevant to the present issue was whether he had or had not complied with statutory requirements. He was not concerned at that moment to defend the policy which Parliament had laid down in the Naval and Military Works Acts. The only question that could be relevant to the present issue was whether he had or had not complied with the statutory requirements of Parliament. His views on the matter were well known to the Committee, for he had explained them on more than one occasion. The whole matter had been carefully considered by the House on the Military and Naval Works Acts. It was obviously impossible, and he believed it would be out of order, to discuss the policy embodied in these Acts, or the actual expenditure provided in them on an occasion like the present. He thought he had said enough to meet the charges which the two hon. Gentlemen had levelled against him. The proposal he had made was one which met the necessities confronting them in such a way as to secure a considerable immediate reduction of the floating debt which had been inherited from the war. It secured, in addition, a regular diminution of the floating debt year by year until another £10,000,000 of it was extinguished. At the same time it did not draw on the resources which had hitherto been devoted to the payment of the Debt. The Sinking Fund had been specially increased in order to make provision for that debt. The proposal had met on the whole with favour in this Committee when he first expounded it, and he believed it had met with approval elsewhere. When it was realised that in taking this step the Government were recognising an obligation which was incumbent upon them, it would be felt that they had chosen the best means of providing for its fulfilment.

said he wished to say a word or two on the question of the South African contribution. It would have been unnecessary for him to make any remarks on the point at all had it not been for the circumstance that on his side of the House opinions had been expressed on the Transvaal loan which he utterly objected to.

rose to order, and asked whether it would be more for the convenience of the House that the question of the Transvaal contribution should be discussed on the clause.

It would be more convenient for the Committee that the discussion should take place on the clause.

said the Chancellor of the Exchequer had referred to the question.

That was a passing comment, and I did not wish to interrupt the right hon. Gentleman.

said he would refer to the question when the clause came before the Committee.

said he would state in a sentence why some hon. Members had called these lottery bonds. The essence of a lottery transaction was that those engaged in the transaction drew lots. What the Chancellor of the Exchequer proposed was that the holders of these bonds should draw lots.

That is done in transactions in this House.

said that was so, but no pecuniary advantage was given in that way. The essence of this proposal was that pecuniary advantage was obtained by those who were lucky in the lottery.

That happens very often on Tuesdays and Wednesdays.

There is no pecuniary advantage. There is no law against lotteries where no prize is given.

Is not a fiscal debate a prize?

When the Prime Minister runs-away! What happened in regard to these bonds was that certain bonds on being drawn were redeemed at par. The person who was first successful in the lottery, and whose bonds were redeemed, got a greater financial advantage than the person who was unsuccessful in the drawing, and so on each year in turn until the last of the bonds were drawn. If that did not constitute what was ordinarily understood by the word lottery, he failed to understand what a lottery meant. The term lottery as applied to these bonds was strictly accurate in letter and spirit.

said the hon. Gentleman was mistaken in saying that the holders of these bonds drew lots. The lots were drawn for them. The hon. Gentleman also said that there would be a gain to the holders by having the bonds drawn early. That would depend on the state of the market. If these bonds stood at 101 there would be a loss.

It is equally a lottery.

said the system of drawing bonds was extremely common. It was practised by every Government in Europe and in all parts of the world. The only Government which had not hitherto practised it on its own particular stock was the British Government. But they had practised it upon the guaranteed loans in the shape of the Egyptian Loan and the Greek Loan. The only objection to this loan which he could see was that we should not get such a good price in the market because these bonds were not so popular. If the Chancellor of the Exchequer wished to redeem this particular loan within ten years he would have been in an awkward position if he had adopted the other course, because he would have had to deal with it in a way which would have disturbed the money market.

The hon. Baronet entirely forgets that we have £21,000,000 of Treasury bills which the Chancellor of the Exchequer can redeem. That would not upset the money market.

said that only made it worse, because the Government were continually borrowers or lenders in what was called the short-money market. The taking of £10,000,000 out was an advantage to the money market not only of London but of the world.

said he took an entirely different view from the hon. Member as to the difficulties of a Chancellor of the Exchequer who had £1,000,000 at his disposal. The hon. Member seemed to think that the difficulties were insuperable. He could always buy Exchequer bonds.

What I said was that if this particular £1,000,000 had to be ear-marked for a special purpose it would be difficult to know how to employ it to advantage, and that it would be better to use it in the way proposed.

said that supported his view. If the money was ear-marked it went to the purpose for which it was ear-marked. He believed he was the first to call these bonds lottery bonds. He did so for the simple reason that there was a direct element of chance in them. The objection to these lottery bonds was that they did not give the advantages of a lottery. The advantage of a lottery was that it appealed to everybody at large, to rich and poor, and especially the poor man in the street, but the appeal here was necessarily restricted, In the State lotteries abroad certain people who were successful at the drawings did get a great amount of profit out of the vicious propensities of their fellow-citizens. There was great need for meeting the Unfunded Debt, which was the worst form of debt we had at the present moment. He had worked it out and he found that the interest was about £3 5s. per cent. [An HON. MEMBER: £3 4s. 4d.] It was an onerous debt, and it must seriously affect the money market. He gave the Chancellor of the Exchequer considerable credit for the effort he had made to deal with it. Reference had been made to the powers conferred by the Act of 1900. The Exchequer bonds authorised by that Act were really war bonds. They would not have been issued but for the war. He had carefully studied the Act and he was bound to say that by the strict interpretation of the Act the right hon. Gentleman was not unjustified in saying that these bonds should be paid off in 1915 and not in 1910. The net result of that was that the repayment of the debt was really extended for five years. Now, as he made out, the man who held these bonds which were to be paid off the first year, would receive interest at the rate of rather over 4 per cent., while the man who held bonds to be paid off in ten years would receive interest at a considerably less rate. The average interest, he understood, would be 3¼ or 3⅛ per cent. Well, that was a very high rate of interest to pay, because we were a 2¾ per cent. country at this moment, as was shown by the price of Consols.

said that reference had been made as to whether these bonds were or were not lottery bonds. They might be classed as lottery bonds because one investor at one period got more interest than another investor at another period. The question whether they were issued at or below par made them more or less lottery bonds. He could say that as long as the present Government was in office the bonds would not go beyond par. The particular objection which he had to these bonds was, as the hon. Baronet the Member for Peckham, who was a recognised authority in regard to financial questions, had stated, that they were an unpopular form of investment. That was shown in a two-fold way. The application for them was very limited, and they were issued at a very heavy price to the Exchequer. As his hon. friend behind him had said, it could not be an advantage, having regard to the money market, to issue a new form or denomination of bonds. Already we had on the money market, in respect to the Unfunded Debt, far too many different denominations of stocks. Everybody knew that the larger the stock the easier it was to deal in it; and, therefore, the better the price obtained so far as the Government was concerned. Therefore, it could not be to the advantage of the Government, to the money market, or the credit of the country to issue a denomination of stock which was unpopular. There was another matter to which he attached considerable importance. He congratulated the Chancellor of the Exchequer on having added £1,000,000 to the fund for the extinction of the Debt. But, in his opinion, it would have been better if the right hon. Gentleman had not tied his hands in the manner he had done in applying that £1,000,000 to the Sinking Fund instead of to the floating debt.

said that the hon. Member for King's Lynn was mistaken in believing that the interest on these bonds would amount to £3 5s. to £3 10s. per cent. It would not be more than £3 2s. Speaking as one who was very much in sympathy with all the observations which had been made as to the necessity for a speedy reduction of the Debt, he approved of the mode of repayment outlined in the Finance Bill because he believed it would secure the automatic action of the depletion of the Debt more than if the matter were in the hands of the Chancellor of the Exchequer. The present Chancellor of the Exchequer said that it was his wish to redeem the Debt as much as possible; but, for himself, he liked much better an arrangement which was concluded between the State and the bond-holder, and which removed the control from the Chancellor of the Exchequer in the redemption of the Debt. His hon. friend spoke of the Debt being increased by this five years arrangement. Certainly it would be increased. Nobody believed that these bonds were going to be paid off by the year 1910. They had had already experience of the disappointment of expectations of the repayment of debt. His hon. friend said that if Exchequer bonds, instead of these bonds, had been issued, they could have been issued on much lower terms; and in proof of that he quoted the Stock Exchange List of the previous day. That reminded him of the old saying that "If only I knew to-day what you will know to-morrow, how much richer both of us would be." He thought the hon. Member must perceive that his argument was misleading. In his opinion the arrangement made by the Chancellor of the Exchequer was an excellent one; and he liked it all the better because it was novel and would popularise this form of the repayment of the Debt.

said that the question whether these bonds were lottery bonds was so obscure that it ought to be ignored. He himself would have preferred that these bonds should have been issued for £20,000,000, to be redeemed by £2,000,000 each year, instead of £10,000,000 to be redeemed by £1,000,000 each year. He agreed also that the number of the different issues and the complicated way in which the Debt redemption was arranged was a great misfortune. It required many Questions, and the issue of many Papers, to get out the fact that this year the Debt had only been reduced by £3,000,000. Any one looking at the ordinary Returns would have been led to suppose that the amount of the Debt paid off was £10,000,000. He thought it was not creditable to this country that we were only paying off debt to the extent of £3,000,000 a year. He thought that the £10,000,000 a year, which most people thought we should pay, was the sum which ought to be paid. Most people who read the speech of the Chancellor of the Exchequer thought

said he desired to move the two Amendments he had put upon the Paper in the form of one Amendment. He did not wish, in moving this Amendment, to go over the ground already covered on the Second Reading of the Bill at any length, he would merely recapitulate briefly the arguments then stated. Two years ago the fixed debt-charge was established at £27,000,000. At that time they argued that it should be £28,000,000. The right hon. Gentleman the Chancellor of the Exchequer might no doubt say that when he now proposed to put the fixed debt-charge at £28,000,000, hon. Members were not satisfied, but wanted it increased to £29,000,000, but the position had changed, and the £28,000,000 now were only as effective as the £27,000,000 two years ago. Every argument then used against the debt-charge being less than £28,000,000 was valid now against its being less than £29,000,000. Two years ago we thought to get £34,000,000 from the Transvaal, which was to be used in repayment of the Debt. £1,000,000 of that was to be obtained in the course of this year, and that was to be applied in reduction of the Debt. Of the remaining £33,000,000 we had received £3,000,000, which had not been used in reduction of debt, but to make up the deficiency of revenue in 1904. The remaining £30,000,000 we had not seen. Of the £34,000,000 anticipated by the right hon. Gentleman the Member for Croydon in 1903, the Chancellor of the Exchequer was thus only able to use £1,000,000 this year for the purpose of the reduction of debt, and therefore we were £33,000,000 worse off than when the right hon. Gentleman the Member for Croydon fixed the debt-charge at £27,000,000. Had that £33,000,000 been received we should have been saved interest which we now had to pay to the extent of £920,000 a year, which was practically the equivalent of the £1,000,000 now proposed to be added by the Chancellor of the Exchequer, so that in fact the right hon. Gentleman was only making up the excess which we now had to pay beyond the amount anticipated by the right hon. Member for Croydon in 1903. To-day we had the same Sinking Fund available out of a fixed debt-charge of £28,000,000 as was anticipated by the right hon. Member for Croydon in 1903 would be obtained for a fixed debt-charge of £27,000,000. whilst the total amount of the Debt stood at £33,000,000 more than it would have done had the right hon. Gentleman's anticipations been realised. It was not enough for the Chancellor of the Exchequer to say the total provision was now larger than it had ever been, nor was it sufficient to say the percentage was larger in proportion to the total debt. There were other points to be taken into consideration, and those he wished shortly to bring before the Committee. First, there was the present price of Consols. Our credit stood too low. The high price of Consols was given in 1899 by the Chancellor of the Exchequer of that time as a reason for reducing the fixed debt-charge from £25,000,000 to £23,000,000. The reverse of the argument would apply to-day. With Consols standing at 90, it was our duty to make any reasonable sacrifice to raise the price to par. Power to borrow at a low rate was one of the best of national defences. For the purpose of renewing Treasury and Exchequer bonds the Chancellor of the Exchequer was every year the largest borrower in the market. In the course of the present year he would have to borrow at least £40,000,000, mainly for the purpose of renewing old debt. Last year the money was borrowed at an average rate of £3 4s. 4d. per cent., and the national credit standing at about the same level now as then, it was reasonable to assume that a similar rate of interest would obtain this year. Consols at their present price yielded to the investor £2 15s. 6d. per cent., but they were largely in the hands of holders who were not likely to come into the market; and consequently Consols were at a much higher level than would be indicated by the rate at which the Chancellor of the Exchequer could borrow on bills or bonds. What would be the effect if the right hon. Gentleman had to borrow a capital sum in Consols? At the very best he would have to borrow at the same rate as for bills or bonds, which would mean that the Consols would have to be raised not at 90, but at 80. That showed that by allowing the national credit to drop so low we were running a very grave risk in the event of war. Vast sums of money were spent every year during time of peace simply for the purpose of being ready for war. It was just as important for purposes of defence that the national credit should stand high, and he submitted that it would be well worth while to spend one or two millions more a year in buying Consols in the open market in order to force Consols at least up to par, so that the national credit might stand again on a 2½ per cent. basis. By paying £3 4s. 4d. instead of £2 10s. for interest there was a loss of 14s. per cent., representing £290,000 a year on the £40,000,000, which had to be borrowed, and this sum would be saved automatically if the necessary sacrifices were made to bring the Sinking Fund up to a proper level. His second point was that we were not in fact paying off debt at all at the present time. The Chancellor of the Exchequer had stated that during the current year debt would be paid off to the extent of £3,000,000. There was provided in the fixed debt-charge a sum of £8,400,000 for the purpose of the Sinking Fund, and £1,600,000 would be provided on the Votes, making £10,000,000, and the right hon. Gentleman had thrown in another £1,000,000 which was to be received from the Transvaal. Against this total of £11,000,000 there was new borrowing to the amount of £8,000,000, leaving a net reduction of debt of £3,000,000. But it was not paying oft debt in the ordinary sense if assets were used for the purpose. The real amount by which the Chancellor of the Exchequer proposed to reduce debt this year was only £2,000,000 because the £1,000,000 from the Transvaal was an existing capital asset. So far from reducing debt since the war we had not been paying our way, with the result that three years after the war we should be actually £2,000,000 worse off than at the close of the war. That was not a satisfactory position for the country to be in. There were still over £14,000,000 to be borrowed on capital liabilities, so that for at least another two years the Chancellor of the Exchequer would go on borrowing, and it was not too much to say that at the close of 1908 debt would not have been reduced during the preceding five years by any appreciable sum at all. It had to be remembered that all the purposes for which money was now borrowed used to be satisfied out of revenue, and if the present system were continued it would ultimately mean that while an average amount of £7,000,000 a year was being borrowed, we should be repaying in interest and sinking fund on the total sum of such borrowings at least an equal amount. Thus the system would have to be brought to a close, but with what result to the taxpayer of the future? He would be saddled with interest and sinking fund on the borrowed money to the extent of not less than £3,000,000 a year, and he would have at the same time to meet out of revenue all those purposes for which money was now borrowed He submitted that that was a ground for a greater effort being made, so long as the borrowings in respect of capital liabilities continued, to increase the total amount of the Sinking Fund. His third point was the inadequacy of the present Sinking Fund. In 1875–76, when the Debt stood at about the same figure as now, but the revenue was only half as large, Sir Stafford Northcote put the fixed debt-charge at £28,000,000. In the present year we were making a sacrifice of £2,000,000 for the reduction of debt. In Sir Stafford Northcote's time, with half the revenue, the sacrifice was £3,500,000, so that even if the Sinking Fund were extended by £1,000,000, as he proposed, the level of sacrifice attained by the taxpayers of 1875–76 would not have been reached. It had to be remembered that future wars would be vastly more expensive than past wars had been, and consequently if new debt had to be incurred for war purposes it would be in far larger amounts than hitherto. That meant that a comparison of the provision made for Sinking Fund in former years and the provision made today was not a useful comparison. Our resources for the repayment of interest and debt were far greater to-day than thirty years ago, and we ought to be willing to make greater sacrifices. This was not at all a Party question. Economists on both sides agreed that sufficient sacrifices were not being made at present, but their criticisms, valuable though they were, would never be effective unless they were backed by votes. He believed that in the present condition of the House of Commons, if hon. Members opposite who had spoken strongly on this question merely threatened to support their speeches by their votes they would get their way in the matter. Savings could admittedly be made this year on Army expenditure, and by such savings the provision for the reduction of debt could easily be increased by £1,000,000. He appealed to economists on both sides to insist that the Government should not be satisfied with a fixed debt-charge of £28,000,000 as now proposed. He begged to move.

said that if he remembered rightly, at an earlier stage of the proceedings, the Opposition, led by right hon. Gentlemen on the Front Bench, instead of supporting the endeavour the Government were making to increase the Sinking Fund, went into the lobby against any increase of the fixed debt-charge. He need say very little about the Amendment itself, as probably the form in which it appeared on the Paper was dictated more by a desire to get round the rules of the House than by admiration of its exact wording. The two parts of the Amendment were inconsistent the one with the other. By Section 1 of the Sinking Fund Act, 1875, the permanent annual charge was directed to be charged to and issued out of the Consolidated Fund, and that would be inconsistent with the procedure commended in the second part of the Amendment, which also was open to the objection—and he was surprised that the hon. Member should be guilty of such fiscal heresy—that it attempted to intercept revenue before it reached the Exchequer. If the Amendment were put forward on its merits those observations would be sufficient, probably, in the estimation of the hon. Member himself, to dispose of it. The Amendment, however, was put forward not on its merits, but as a vehicle for the suggestion that the amount devoted to the reduction of debt in the present year was insufficient. The hon. Member had dealt once again with the Transvaal contribution, but he did not propose to follow him in that, and he regretted that there should be further discussion upon it at the present time, because it was understood that it should be dealt with on the Motion that the clause stand part of the Bill. ["No."] At any rate, at the present stage of the discussion he did not wish to add anything to what he had already said upon that subject. It was said that it was a most urgent thing that they should make a larger contribution to the reduction of the National Debt, and one hon. Member had suggested that he should have used the whole of his surplus for that purpose. He thought an increased contribution for this purpose was eminently desirable and indeed urgent, but if they pressed this argument for a high Sinking Fund too far they might defeat the object they had in view, because they found it difficult to maintain steadily even at a reasonable amount. At a time when taxation was already so high he could only repeat that in his opinion he thought he had held the scales fairly between conflicting interests by devoting an additional £1,000,000 to this purpose during the current year.

said he agreed with the hon. Member for Monmouth that the strength of a nation depended not so much upon its warlike forces as upon its financial resource. He considered, therefore, that the position of this country had been considerably weakened by its present financial position as compared with its position five years ago. Our Debt was not only much larger than it ought to be; but larger than it was a year ago. If the Chancellor of the Exchequer had adhered to all the taxation enforced a year ago he thought the Opposition would not have done unwisely if they had followed him into the lobby in support of retaining taxation in order that the Debt might have been by so much reduced. To show how important the financial resources of the nation were, he would instance the course of the war in the Far East, and the constant anxiety of the Japanese and Russian Governments, not so much to maintain the number and standard of their forces, but to borrow a sufficient amount of money at a low rate of interest. And it was the extraordinary and complete recovery of the financial position of France which enabled her to shake off the yoke imposed upon her by Germany and to resume her place among the foremost countries of the world. What had been instrumental in enabling us to take, a foremost place in the councils of the world had been rather our extraordinary and superior command of money and all that money carried with it than our Army and Navy. It was those potential resources that had enabled this country to scramble through contest after contest with other Powers, because it had been fully realised by other nations that we could carry on hostilities longer than they owing to out financial resources. It seemed to him that in spite of our unparalleled prosperity during the last ten years, we had wasted our resources on wrong objects, because we had had insufficient advice and because the control which the Chancellor of the Exchequer ought to keep over other Departments of the State had been constantly relaxed. If this proposal were carried, and we devoted more money to paying off our liabilities than we had hitherto done, we should have what was much more valuable than a gold reserve, we should have our credit unimpaired, and, more than that, it would be vastly increased. It was in our credit that the strength of this country lay.

said he thought he could show that the Chancellor of the Exchequer was under a misapprehension as to what was the Consolidated Fund. After the revolution of 1688, for 100 years every tax was allocated to a special purpose, and as a matter of fact there were in the Customs alone seventy-five taxes, each devoted to its own particular purpose. In 1787 they got rid of this system; the Consolidated Fund was instituted, and it was enacted that that should be the reservoir to which every public receipt should go and from which should flow every item of public expenditure. The Consolidated Fund had since then ceased to be entitled to be name through the practice of intercepting the moneys that belonged to it before they reached it. The hon. Member proposed to follow that example by his Amendment. What were the real merits of this matter? They had had the advantage of an object-lesson, showing the extreme facility with which, when once the matter was understood, any Member of the House could take hold of public money and apply it to any purpose he pleased. The hon. Member was the first who had done this. No Committee was required, no recommendation by a Minister of the Crown, and none of the ordinary financial securities which the House had placed around public money. Any Member at any moment might get up and move an intercepting Motion of this sort, applying the whole of the death duties to any purpose he chose in his wisdom to select. He would remind some of the hon. Gentlemen from Ireland who were occasionally inclined to apply public money to purposes which would benefit their country, that the hon. Member had taught a very great object-lesson. The hon. Member sought to intercept a million of money out of the estate duties and to add it to the permanent fixed charge for the National Debt. That our Sinking Fund was too low, and that it ought to be higher, was a belief which nobody had affirmed with greater industry than himself. It appeared to be perfectly wanton that we should go on with a fixed National Debt charge only £28,000,000, the sum which Sir Stafford Northcote applied to a really smaller Debt, because we had not then the vast Unfunded Debt we had now. The sacrifice made by the community to get rid of the great burden of debt was greater when the Debt was smaller, and, therefore, he was a strong advocate for increasing the Sinking Fund. He reminded the Committee that the financial enemy of the Sinking Fund was the Chancellor of the Exchequer. There never was a Chancellor of the Exchequer who got into financial difficulty—and however short his tenure; of office might be it was always long enough to get into financial difficulty—but he attacked the Sinking Fund. A Chancellor of the Exchequer was a brigand by nature. When he met the Sinking Fund in the wood he robbed it; this had happened time after time. It was a simple method of getting rid of his obligations. There was one method by which a proper Sinking Fund could be maintained in such a way that no Chancellor of the Exchequer could touch it. That method was to attach one source of revenue to the National Debt, say the estate duties. If the estate duties were affected to the National Debt—he did not mean to affect them alone, but in addition say, to another £16,000,000—that part of the Sinking Fund would never be touched, because, although the Chancellor of the Exchequer would always feel the same temptation to rob it, he would be deterred from it by the insuperable dislike which the Chancellor of the Exchequer always felt to taking off existing taxation. If the House were to affect the estates duties to the Debt they might have confidence that that source of the Sinking Fund would not be tampered with. The reproach had been made that this Amendment was a wicked example of interception. Yes, but who snowed the example? It had not been the unofficial Members, but the Government themselves. He had always strongly protested against it as a most improper thing to do. It had led to the falsification of the public accounts and the depletion of the Consolidated Fund, which was every year £20,000,000 poorer than it should be on account of the violations and partial repeals of the Exchequer and Audit Act of 1866, which prescribed that all the money should go into the Consolidated Fund. The hon. Member's Amendment was not out of order, and, after the strong advice he had himself given that the fixed National Debt charge should be increased, he felt bound to vote for the Amendment.

said the question whether we should get the £30,000,000 contribution from the Transvaal was important at the present time. Certain of his hon. friends had expressed the opinion that we should not get the money. An hon. friend wrote to a paper in which he said we had no right to claim the War contribution from the Transvaal, because we had conquered and annexed the country. It was, he said, the first time he had ever heard the South African War talked about as conquering and annexing. He always thought that we went there to relieve the so-called intolerable oppression from which our countrymen and others were suffering. We had relieved them from that oppression, we had given them cheap dynamite, cheaper railway fares, cheap and abundant labour, and he thought now was the time when they ought to perform their part of the bargain. Not only so, but we had in doing this reduced the cost of mining and extracting gold from the quartz lower than ever it was before, and thus greatly benefited the people of the Transvaal. For the gold mines were the Transvaal, and the Transvaal South Africa, therefore, in helping the mining industry we had helped everyone dependent upon it. For these reasons he thought the people of the Transvaal ought not and would not be guilty of the dishonourable evasion of a fair bargain and a just obligation. We had spent £230,000,000 on the war, and he thought it was the least they could do to make this small contribution to the heavily-burdened taxpayer of this country. Besides that, we had pledged our credit for the guaranteed loan of £35,000,000, which was at the time considered part and parcel of the bargain. He supposed that quite half the shares in Transvaal mines were held by foreigners, and he could quite understand foreign shareholders in Germany and France and other places thinking they would rather have the £30,000,000 in their pockets than employ it in giving relief to the British taxpayer. But it was said that those people who arranged to pay the money were not at all representative, that they were merely a few people met together with the right hon. Gentleman the Member for West Birmingham. That was a mistake. Rightly or wrongly, they were the people who organised the agitation which led to the petition that ultimately led to the war. They were looked upon as leaders by the people of the Transvaal, and it was with the sanction of the people of the Transvaal that those great leaders of the mining industry made those representations to this country. Now those very same people had a perfect right to pledge the credit of the Transvaal in the way they had done. To say that there was no debt of honour was a great mistake. He could not think that our kith and kin across the seas would, for a moment, try to wriggle out of this honourable undertaking given by their leaders. The right hon. and learned Member for Dumfries, with whom on this question of the war he generally agreed, spoke of the enormous debt per head of the white population of the Transvaal. It was an enormous debt per head, but they had enormous resources. And at present kaffir and coolie labour was increasing in very much greater ratio than white labour. Therefore, the more kaffir and coolie labour increased, the richer would become the country, yet the debt per head would remain and possibly increase. There was nothing in the argument to take the debt per head, because they had to consider the enormous resources of the Transvaal. He did not believe the leaders in the Transvaal would try to get out of this debt, and therefore they ought to deprecate anything said in that House which would give them an excuse for thinking that they ought not to pay. If they thought that contribution too much, no doubt this country would be very glad to consider any reasons for reducing it. He would suggest, in order to make the burden as light as possible, that this country should guarantee a loan of £15,000,000. Of the ability of the Transvaal to pay there could be no doubt—in fact the profit accruing to the Government from the Premier Mine would be enough to pay the interest at 3 per cent. on a loan of £15,000,000. He said again that for the people of the Transvaal to attempt to wriggle out of their just obligation would be a dishonest and dishonourable course.

said he had listened a short time ago to the pessimistic statement made by the hon. Member for Monmouthshire as to the decline in British securities. He did not think there was any reason for despairing about British securities. It was quite true that when we were borrowing huge sums of money to carry on the South African War, naturally British securities fell in the market. After the war was over they all thought that the securities of the British Government would recover, but that expectation had been disappointed. The reason was obvious. It was because the world, instead of settling down to industry and commerce, saw the outbreak of another great war between Russia and Japan. These countries were, in order to carry on the war, borrowing funds from the Western markets. Until that war was over it was unreasonable to expect any cheapness of money. After all, a 2½ per cent. security at 90 was just the same thing as a 3 per cent. security at 108. He did not think the Chancellor of the Exchequer could reasonably be called upon to increase the Sinking Fund more than he had done for the purpose of restoring British credit. British credit was very good at the present moment. Great Britain could borrow money as cheaply as any other country in the world. [An HON. MEMBER on the OPPOSITION Benches: The United States.] It was said that the Chancellor of the Exchequer ought to have raised the Sinkling Fund by more than £1,000,000, and that he ought to have put it in the Same condition it was under the right hon. Gentleman the Member for Croydon. He remembered that the right hon. Gentleman the Member for Croydon would have raised the Sinking Fund to £28,000,000, but that he believed the Transvaal Government would repay very quickly the war contribution of £30,000,000. The present Chancellor of the Exchequer did not count on the repayment of that debt. He thought that the Chancellor of the Exchequer had made a very reasonable provision for the repayment of the National Debt, and that there was no fear of any decline in the credit of this country.

said that the right hon. Gentleman opposite declared that the great fall in English securities was only the same as had occurred in regard to the securities of all other nations. That was not the case. While the credit of England had fallen, that of Italy had enormously increased, and the same was true of many other countries. There was no getting out of the fact that England had now to pay £3 2s. 6d. interest for a loan extending over ten years. He insisted that that was a tremendous fall in the credit of England. In spite of what the Chancellor of the Exchequer and other experts had said, English Consols had fallen to the very lowest point and showed no sign of recovery. That involved an enormous loss to this country and especially to Ireland. The sufficiency of the Sinking Fund was inextricably bound up with the question of the payment of the Transvaal in- demnity; and what he complained of was that in all these recent discussions the House of Commons had been treated most unfairly. They could never get at the real facts of the situation. They had been told by successive Chancellors of the Exchequer that the Sinking Fund was to be increased as soon as peace was restored. But not a penny additional had been paid off the Debt. In 1903 the Debt of the country was £798,349,000 and the assets were £5,283,000. Therefore the net debt was £793,066,000. In the present year the Debt was £796,736,000. The realisable assets of the country had declined by over £3,000,000; so that the net Debt had increased by about £1,500,000 as compared with two years ago.

asked if the hon. Member included the Suez Canal shares in his estimate.

said he did not include the Suez Canal shares, because they were not to be sold. They were not in the sense liquid assets. The speeches of successive Chancellors of the Exchequer were most misleading in this respect. Last year the Chancellor of the Exchequer, being in a difficulty, annexed £1,000,000 of unclaimed dividends, of which there was no entry in the Return. That, in his opinion, vitiated the Return to that extent. The total net result was, although the figures were covered by complexity and confusion, that the country now owed £2,500,000 more than it did two years ago. The question of the Transvaal contribution was another illustration of the unfairness with which the House of Commons was being treated. Two years ago the right hon. Gentleman the Member for Croydon delivered a most optimistic speech in introducing his Budget. He indicated that the Debt would vanish away like a morning's mist before the sun. The right hon. Gentleman then said that before deciding what the annual debt-charge should be, the Committee should consider the arrangement entered into by his right hon. friend the then Secretary for the Colonies, under which £4,000,000 was to be obtained from the Transvaal immediately, and, in the course of the succeeding three years, a sum of £30,000,000 towards the expenses of the war. The right hon. Gentleman accordingly fixed the annual debt-charge at £27,000,000. However, not a penny had been received from the Transvaal; and there was now a worse prospect of getting anything than there was three years ago. The whole financial structure of the right hon. Gentleman the late Chancellor of the Exchequer was based on the assumption of the receipt of £30,000,000 from the Transvaal. He calculated that on March 31st, 1908, the Debt would be reduced to £694,000,000; and that the Sinking Fund would be £8,841,000, or 1·25 per cent of the Debt. Now they were half way to the stated time and instead of the Debt being reduced it had been increased by £2,500,000. The right hon. Gentleman stated that the whole of this gigantic Debt would be wiped out in fifty years. Yet the Debt was increasing at the rate of £1,000,000 a year. After the previous great war Sir Stafford Northcote fixed the annual debt-charge at £28,000,000, although the Debt was then £30,000,000 less than at present. That charge was maintained until the Debt was reduced by £100,000,000. During the recent war £159,000,000 had been added to the Debt, and the country did not make even the most ordinary effort to repay a war debt in time of peace. When the right hon. Gentleman the Member for West Bristol was Chancellor of the Exchequer he said he proposed to raise the war expenditure by means of bonds, not by an addition to the Debt. The latter, he added, would only be justified in the case of war with a first-class Power. That had reference to the character of the Power.

And the cost of the war.

said that the condition was war with a first-class Power; and no one would contend that the Transvaal was that. The right hon. Gentleman further stated that he hoped the war debt would be paid off in two years or sooner. Of course, the right hon. Gentleman was then only contemplating an expenditure of £10,000,000. There was an obligation on the part of the country to discharge this war taxation. The House of Commons had not been treated fairly in the matter. Was it not better to face the matter and deal with it honestly instead of being led on like a pack of fools by Chancellor of the Exchequer after Chancellor of the Exchequer telling them that they were going to get the money shortly? They were not going to get the money, but they were going to give General Botha and the Responsible Government Association, largely composed of Englishmen, the most popular cry they could possibly have. They were going to lose this money, but not by generosity, not by doing frankly and handsomely what they would have to do in the end meanly and contemptibly, and they were going to set up an agitation in the Transvaal in which they would have every man in South Africa against them. The mineowners would not mind. They had got all they wanted—their £35,000,000, their cheap dynamite, and their Chinamen. They would take a back seat now. He protested against the House of Commons being "hung up" and deluded, It was a shame for responsible Ministers to delude the country by building up the financial system of the Budget on the assumption that they would ever get a shilling of the money.

said he was sorry to have to trouble the Committee again with a defence of his action, because he had already explained it more than once very fully. The remarks just made by the hon. Gentleman with regard to the payment of this contribution from the Transvaal were not at all likely to improve our prospects of obtaining that which was undoubtedly due. When he thought of the amount arranged as that contribution he regarded it as a tribute to the great moderation of this country. One would almost imagine that the hon. Member held a brief for repudiation. Not only the words he uttered, but the tone in which he uttered them, constituted a direct incitement to those who desired to repudiate obligations properly undertaken.

said he was only following the example of the Morning Post.

thought the hon. Member preceded the Morning Post. He remembered a speech made by the hon. Gentleman much on the same lines many weeks ago. Coming to the complaint made against him for his optimism in assuming, when framing his Budget, that this contribution would be received, what was the financial position at that time? The country had been groaning under extraordinarily heavy burdens of taxation for some years, and all classes of the community were suffering in consequence. Trade was depressed, and he was naturally anxious to moderate these burdens. When he had to decide what amount of Sinking Fund he was prepared to recommend to the House, was he, in his natural and proper survey of the money likely to come in not only in that year but in the succeeding year, to leave out of account the arrangement for the payment of £30,000,000 from the Transvaal? It must be remembered that he had before him not only the views which the Colonial Office held on the subject, but views which had been arrived at after careful consideration on the spot by the right hon. Gentleman the then Colonial Secretary, and all information which was in the possession of the Colonial Office. He had to take that into account. Not only that. It was his duty to study carefully for himself all the bases on which the right hon. Gentleman had rested the belief that this money would be received. Having done so, he came to the conclusion, independently of the right hon. Gentleman, that they had a perfect right to expect that the money would be received in due time. So far as the first payment was concerned, the subscription of the first £10,000,000 was practically guaranteed by those most able to give that guarantee in the Transvaal. He had every reason to expect from the financial statement of the resources of the Transvaal sent to him by Lord Milner that the revenue of the Transvaal would be such during the next three years as would amply provide for all the cost of administration in the Transvaal as well as for the interest of the debt which would be created for the contribution. But, of course, as every one knew, the view then taken, both by himself and others and all who had studied the matter, was too optimistic. He did not pretend to be a prophet at all. He judged from the material at his hand at the time; and he came to the conclusion that when he had to settle the burden to be pat on the taxpayers of this country he not only had the right, but it was his bounden duty, to consider that during the three years, including the one in which he was speaking, there was every reason to believe in the receipt of £10,000,000 a year from the Transvaal. He arranged his Budget accordingly, and everything quoted from his speech would have been fully justified had the contribution been paid. It would have been true that the amount of the Sinking Fund would have been greater than any percentage of previous times. It turned out that the rosy views of the prospects of the Transvaal, of its revenue and its progress, were not justified. Earlier in the afternoon it had been asked why payment of the first £10,000,000 was not insisted on. The reason was perfectly obvious. It was true that there was a guarantee from the mineowners, but what the Government had to consider was not the question of taking up the £10,000,000. About that there was no doubt at all. What they had to consider was the possibility of the Transvaal being in a position to find the interest on the debt. They had to consider whether they should exercise the power of compelling the Transvaal, whose conditions were, of course, extremely grave, to issue a loan when the finance of the country showed it was quite impossible that the interest on the loan could be paid along with the other charges necessary for carrying on the government. It would have been the height of folly to insist upon the loan being issued in these conditions merely because the floating of £10,000,000 had been guaranteed. He could conceive no greater disservice that could be done either to the Transvaal or this country than to have insisted on doing such a preposterous thing.

said the right hon. Gentleman forgot that the Transvaal was asked to raise a loan of £35,000,000.

said that was all the more reason for not putting the other burden upon the colony. The £35,000,000 loan was for purposes altogether different. It was mainly for the purposes of the development of the Transvaal itself, and for the payment in the Transvaal of money to those to whom it was owing. It was after considering that the interest on that loan would have to be debited to the revenue of the Transvaal that they found it impossible to insist upon £10,000,000 being raised at that time. He had greater hopes than the hon. Gentleman of the future of the Transvaal. He believed its future would be one of boundless prosperity. He based that opinion, not only on the produce of the mines, but on the agricultural future before the colony. He did not take the view that the new body which was created was likely to repudiate that which was undoubtedly properly and fairly due to us; only he did not think the best way of maintaining good relations with the Transvaal was to endeavour to incite the people there to repudiate the undertaking which those who were at the time responsible gave to us. His main object, however, was to show that from the information he then had in his possession, he was not only justified in so doing, but would have been deserving of condemnation if he had not taken into account that large sum of money which we had every reason to expect from the Transvaal and which, in the opinion of the Government, would in course of time come into the British Exchequer.