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Commons Chamber

Volume 10: debated on Thursday 2 September 1909

House of Commons

Thursday, September 2, 1909

Mr. SPEAKER took the chair at a Quarter before Three of the clock.

PRIVATE BUSINESS.

Aberdeen Harbour Order Confirmation Bill—read a second time; to be considered upon Monday next.

ARMY PROMOTIONS.

Return ordered, "showing the average time taken from the date of first commission in attaining respectively the ranks of captain and of major by officers in the Cavalry, Royal Field Artillery, Royal Engineers, Infantry, and Indian Army (in continuation of Parliamentary Paper, No. 221, of Session 1903):— Captain. Major. Years. Months Years. Months 1905:— Cavalry Artillery, Field Artillery, Garrison Engineers Infantry Indian Army 1908:— Cavalry Artillery, Field Artillery, Garrison Engineers Infantry Indian Army —[ Mr. Annan Bryce ].

ORAL ANSWERS TO QUESTIONS.

Egyptian Penal Code.

asked the Secretary of State for Foreign Affairs if murder, attempted murder, theft, attempted theft, destruction of crops, poisoning animals, and arson are contrary to the Egyptian penal code; if it is proposed by the Egyptian Government, under the Ordinance of 4th July, 1909, to punish persons who have been tried for such crimes and acquitted; if it is further proposed to punish persons accused of such crimes, against whom there is not sufficient evidence to justify their being sent to trial; and if it is proposed under the said Ordinance to imprison and punish persons, not because they have committed any of the above crimes or have been convicted of committing them, but because they have been, accused by several people and there is not sufficient evidence to justify the accusation, as explained in the despatch of Sir Eldon Gorst, dated 10th July?

The whole text of the Ordinance has been laid before Parliament. It was discussed and passed by the Legislative Council, and I can give no fuller explanation of its provisions than appears in the Papers now laid. There is no provision in it which entails a sentence of imprisonment.

May I ask whether this Ordinance applies to Europeans—Englishmen, Frenchmen, and others?

I understand there is a question for Tuesday on that point, and I will answer it then.

May I ask whether the detention of foreigners for an indefinite period differs from imprisonment?

May I ask whether this ordinance has the approval of the British Government, which has suzerain control?

The Ordinance was passed by the Legislative Council before it was submitted to the Government at all. It has been under consideration ever since.

Then the right hon. Gentleman endorses Sir Eldon Gorst's approval? Does he, or does he not? Does the right hon. Gentleman endorse Sir Eldon Gorst's approval of the Ordinance and commit the British Government to it?

Yes, I do endorse what Sir Eldon Gorst says. If the hon. Gentleman wishes any further statement made, perhaps he will put a question on the Paper.

When the right hon. Gentleman endorsed that approval, did he consider that persons acquitted of charges have been kept under, detention?

United States Tariff (British Spirits).

asked the Secretary of State for Foreign Affairs whether the new tariff law of the United States imposes a duty on British spirits imported into the United States of $2.60 per proof gallon, whether similar spirits imported from France, Germany, Italy, Spain, Portugal, and Switzerland pay only $1.75 per proof gallon under their respective reciprocity treaties with the United States; what are the dates on which these treaties respectively expire; whether he is aware that in the interval British distillers are placed at a serious disadvantage in being subject to duties of more than 50 per cent, greater than their competitors; and whether any representations, and, if so, with what results, were made to the United States Government as to the breach of the most-favoured-nation clause in the treaty of 1815 which such differentiation represented?

The facts as to duties are as stated by the hon. Member. The reciprocity treaties referred to expire as follows:—Treaty with France in November next, treaty with Germany in February next, treaties with Italy, Spain, and Portugal on 7th August next, and the treaty with Switzerland on 31st October next. This differentiation on spirits is not new, as the question implies, but has been in force for several years, and the matter has been more than once represented to the United States Government, even as long ago as in 1900; but, as the hon. Member is no doubt aware, the United States Government have long held that the advantages granted under the special provisions of the Dingley Tariff Act respecting reciprocity agreements, in return for a consideration, could not properly be claimed under a most-favoured-nation article. These special provisions are, however, not repeated in the new tariff law.

further asked the right hon. Gentleman whether, before the present tariff law came into operation, the duty on spirits imported into the United States was higher for spirits imported from the United Kingdom than for similar spirits imported from France, Germany, Portugal, Spain, Italy, and Switzerland; whether such differentiation contravened the provisions of the treaty of 1815, by which the United States agreed to extend most-favoured-nation treatment to the United Kingdom; whether any representations have been made to the Government by British distillers as to the hardship imposed by this differentiation; and whether any communications, and, if so, with what results, were made to the United States Government?

The answer to the first part of the question is in the affirmative. The answer to the second part is contained in the reply which I have just given the hon. Member on the same subject.

FINANCE BILL.

DUTIES ON FRENCH WINES.

asked the Secretary of State for Foreign Affairs, if, during the negotiations which took place with the French Budget Committee at the time the new French customs tariff was under consideration, any promise or arrangement was made by the Government that the duties on French wines should not be increased under the Finance Bill, notwithstanding the increase in the Spirit Duty and Excise?

If we have any negotiations at all, will they be made through the Board of Trade, or will they have to pass through the right hon. Gentleman's Department?

I do not see how that arises out of the statement that no negotiations are taking place.

The Foreign Office is the channel through which negotiations must take place, but in the case of commercial treaties the Foreign Office and the Board of Trade are in constant consultation with each other.

CONVEYANCES OF LAND (STAMP DUTY).

asked the Secretary to the Treasury if he can state the number of conveyances of land upon which Stamp Duty was paid during each of the last three years and the amount of the proceeds of the duty in each year?

No statistics are available as to conveyances of lands separately, or as to the number of conveyances on which duty is paid. The amount of duty for conveyances of lands and houses paid the last three years was:— 1906–7 £711,345 1907–8 717,677 1908–9 635,548

BRITISH BEER (AVERAGE GRAVITY).

asked the Secretary to the Treasury whether he can state the numbers and average gravity of the bulk barrels of the beer brewed in the United Kingdom in the year ending 31st March last?

The number and average gravity of the bulk barrels of beer brewed in the United Kingdom in the year ended 31st March, 1909, was:—

TENANTS' INTEREST ASSESSMENTS (IRELAND).

asked the Chancellor of the Exchequer whether he will state in how many cases during the past three financial years have tenants' interests in Ireland been valued for the purposes of the Death Duties; at what sum was the value assessed; and what was the gross Poor Law valuation of the holdings so assessed?

The number of cases during the past three financial years in which tenants' interests in Ireland have been valued for the purposes of the Death Duties, and the sums at which the values were assessed, are as follows:— Numbers. Values. 1906–7 2,140 £219,553 1907–8 2,681 264,346 1908–9 2,352 238,012 The gross Poor Law valuation of the holdings so assessed cannot be stated.

HOSPITAL REQUESTS (LEGACY DUTY EXEMPTION).

asked the Chancellor of the Exchequer whether he is aware that in Ireland all legacies to hospitals and other charities are exempt from Legacy Duty; and whether, in view of the increasing difficulty of finding money to manage hospitals, he will insert in the Finance Bill a provision extending this exemption to Great Britain?

The answer to the first part of my hon. Friend's question is in the affirmative. My right hon. Friend regrets that he cannot see his way to accept the suggestion contained in the latter part of the question.

EXCLUSION FROM EXEMPTION.

asked the Chancellor of the Exchequer whether he has received from the council of the Royal Colonial Institute a communication calling attention to the effect upon persons residing in different parts of the Empire outside the United Kingdom of the provision of Section 50 of the Finance Bill, which excludes such persons from exemption or abatement; and whether the views set forth by the council will receive favourable consideration?

The answer to the first part of the question is in the affirmative. The communication is receiving the attention of my right hon. Friend.

STAMP DUTY PAYMENTS.

asked the Chancellor of the Exchequer if he can state whether payment of the increased Stamp Duties, under Sections 52 and 53 of the Finance Bill, are payable from the date on which the Resolutions dealing with the Clauses were passed, or does the increase only take effect when the Bill becomes law?

I may refer the hon. Member to the reply given by my right hon. Friend on the 16th ultimo to a similar question by my hon. Friend the Member for East Grinstead in which he stated that the new Stamp Duties would come into force on the passing of the Finance Bill.

HOUSE OF COMMONS REFRESHMENT BARS.

asked the Chancellor of the Exchequer whether the provisions regarding clubs in the Finance Bill will apply to the refreshment bars and refreshment rooms of the House of Commons; and, if not, whether he intends to move Amendments to this effect?

LICENSED PREMISES (REGISTER OF COMPENSATION VALUES).

asked the Chancellor of the Exchequer why are the Excise Commissioners to prepare and keep the register of compensation values of licensed premises and of the equivalent annual compensation values and another set of Commissioners, viz., those of Inland Revenue, to certify such values; will the licensee have any opportunity of knowing how such values are arrived at, and of showing cause against the amount registered or certified against him before being forced to pay; is the licensee, or is the House, to be informed of the method of ascertainment or the formula of calculation of the compensation, and the figures upon which it is based and upon which he is to be taxed; what is the proportion or percentage which the sales are to bear to the compensation value; by how many years' purchase is the compensation value to be reduced to its equivalent annual compensation value; and is the Licence Duty once ascertained by reference to sales or value based on sales in one year to be varied in each year according to the actual sales of each year, or is it to be fixed for any, and what, number of years?

The Commissioners of Customs and Excise are the Department responsible for the issue of licences, and as such are entrusted by the Bill with the duty of preparing and keeping corrected the register of compensation values and annual compensation values upon which the duties for Excise Licences will be based. The Commissioners of Inland Revenue are the Department who are now responsible for determining the compensation values under the Licensing Act of 1904, and they have in consequence been entrusted with the duty of determining the compensation values for the purposes of the Finance Bill. The compensation values will be calculated on the same lines as under the Act of 1904, which are well known. The principles upon which the equivalent annual compensation value is to be calculated will, under the terms of an Amendment which my right hon. Friend has placed on the Paper, be prescribed by Regulations to be made by the Treasury.

Chinese Railways (British Loans).

asked whether the British Government had any other object in lending £1,100,000 to the Chinese Government to buy back the concession for the Hankow-Canton Railway except that, on account of its proximity to the British Colony of Hong Kong, it was considered desirable that it should be controlled by British subjects; what steps, if any, were taken between 1905 and the spring of the present year to promote that object by securing for British interests the control of this railway; whether, in order to re-cover the Hankow-Canton Railway, the British and French groups were compelled to allow German financiers to participate in the Szechuan Railway; and, if so, who was mainly responsible for this change?

It is substantially the case that in lending China the sum of £1,100,000 in 1905 His Majesty's Government were actuated by the wish to obtain control over the Hankow-Canton Railway. Negotiations proceeded continuously from that year until the spring of 1909, when, as the hon. Member was informed on the 30th ultimo, a German group of financiers offered the Chinese terms which they considered more advantageous than those the British group was prepared to offer, or than the British Government could have approved, and which the Chinese Government accepted. The subsequent negotiations resulted in a compromise, the object of which was to secure more control and avoid competition.

asked whether the Chinese Government have, under pressure from the British Government, become contributary to the payment of 5 per cent, per annum interest on a loan of £1,500,000 for the construction of the Kowloon Railway, which they know they can never pay; sole guarantors for a loan of £3,000,000 at 5 per cent, interest for the Shanghai-Nanking Railway, which is being worked at a loss to them of £101,000 per annum; solely responsible for the working expenses of the trafficless railway built by the Peking Syndicate, in addition to paying £35,000 a year interest on the bonds for it; whether the Chinese Government always disapproved of the making of each and all of these railways and wanted railways made elsewhere; and in a country where railways are so necessary and would be beneficial to China and to investors if made in right places whether British influence will in future be directed to securing this latter condition?

The Chinese Government promised the concession for these railways 11 years ago. The actual terms on which these lines have been or are being constructed were settled by amicable agreement with the Chinese Government. There is, so far as I am aware, no ground for the allegations implied in the question that the Chinese Government are dissatisfied with the terms or the railways, or that the railways are in districts where they are not required and could not be made profitable.

Reinstatement of Evicted Tenants (Ireland).

asked whether the Estates Commissioners have taken any recent action in respect to the acquisition of the holding on the Pyne O'Callaghan estate, near Kanturk, from which Conn Donovan was evicted, with a view to his reinstatement thereon; are the Commissioners aware that the representatives of the late tenant Singleton are desirous of surrendering the holding upon receiving reasonable consideration there for in order to facilitate Donovan's reinstatement; and whether, having regard to this fact and the arrangement brought about by Inspector Vaughan, the Commissioners have abandoned their intention of acquiring this holding?

The Estates Commissioners are intimating to the owner the price they will be prepared to advance if the holding is sold to them with a view to effecting the reinstatement of the former tenant.

asked whether the Estates Commissioners are taking action at present in regard to purchase negotiations on the Colthurst estate, Rathcoole, county Cork; and, if so, what steps they propose taking towards procuring the reinstatement of Mrs. Julia Lyons, evicted tenant, whose case has been under their consideration for a considerable time past, and in which case the present occupier is willing to surrender the holding on receiving moderate compensation?

I am informed by the Estates Commissioners that this estate has been sold under the Irish Land Act, 1903, and that the holdings have been vested in the tenants. The holding referred to in the second part of the question has been purchased by the present occupier, and the Commissioners do not intend to take any action in reference to Mrs. Lyons' application.

Extra Police Force (Meath).

asked whether a force of police was sent to Portadown from Meath on the 14th August; whether Meath is charged for extra police taken from other counties; and, if the police can be spared from Meath, is it to eke out a profit for the Treasury that an extra force is kept in Meath and charged to it notwithstanding its peaceable condition?

It is true that a force of police was sent from Meath to Portadown for duty on the 15th instant, but the hon. Member is mistaken in supposing that an extra force is now kept in Meath and charged to it. No extra police have been serving in the county since the 26th May last.

Land Purchase, Ireland.

asked the Chief Secretary for Ireland whether he will reconsider the whole question of the higher rate of interest proposed to be charged to all tenants purchasing their holdings in the future; and whether he will consult the Treasury with a view to reverting to the well-established 3¼ per cent, basis before the Report stage of the Land Bill is reached?

This matter has already received the most careful and mature consideration of His Majesty's Government, and it has been decided to be impossible to continue to advance money for Irish land purchase at 2¾ per cent. As was clearly shown in the recent Debates on the Committee stage of the Bill, the Government, in undertaking to make advances at 3 per cent., are giving the fullest advantage of British credit for the furtherance of Irish land purchase.

asked the Chief Secretary whether he can state the amount of money required to settle all the estates now in the hands of the Commissioners for sale to the tenants under voluntary purchase, and how much it is proposed to pay this year towards wiping out the arrears; and by what date he anticipates payment for all estates now in the Commissioners' hands will be completed?

Proceedings are pending under the Irish Land Act, 1903, before the Estates Commissioners for the sale of property representing a purchase money of £52,874,696, in respect of which advances have not yet been made. The Commissioners are not in a position at present to state the amount of the advances which they may be able to make by the end of the current year or in what time the total purchase money applied for may be advanced. Since the commencement of the Act of 1903 the Estates Commissioners have advanced £30,524,155 to date.

asked the Chief Secretary, in view of the statements that the Irish Land Commission had not this season instituted proceedings against defaulters, and were not proceeding to enforce a certain agreement vitiated by duress, whether he will account for the seizure by the sub-sheriff of Westmeath, at the instance of the Land Commission, of a mare and foal, the property of Miss Early, tenant under her father's will of a farm at Corolana, on Lady Chapman's estate, in execution of a decree obtained against Widow Early on an agreement signed by the latter under duress at a time when she was not tenant or competent to purchase; whether the Estates Commissioners undertake the collection of interest in lieu of rent for landlords without inquiring into cases like this brought under their notice, while the landlords can, after the money has been recovered for them by the State, resume the property and cancel the proceedings for sale; whether the Commissioners before the institution of proceedings were aware of the duress and change of tenancy in this case, and instead of having the case investigated by their inspector in the district have had seized the only beast of the plough belonging to the tenant; and whether he will ask the Commissioners to stay all proceedings in this case until an inquiry has been held by their inspector on the ground?

As my right hon. Friend has repeatedly informed the hon. Member, the allegation that the agreement in this case was signed under duress will be inquired into when the estate is being inspected in order of priority. In the meantime, the Land Commission are bound by law to collect and pay over to the owner the interest on the purchase money, which is considerably below the rent which the tenant would otherwise have to pay. The hon. Member is mistaken in supposing that the Land Commission have not instituted proceedings against defaulters this year, or that they have anything to say to the steps taken by the sheriff to execute the decrees of the court. The answer to the concluding paragraph of the question is in the negative.

Will the right hon. Gentleman inform the House how land purchase carried on under circumstances like these, where ruinous terms are enforced, can be called voluntary?

Atkinson Estate, King's County.

asked the Chief Secretary whether Mr. James Wallace, of Cangort Park, King's County, has applied to the Estates Commissioners for an advance of £4,525 to purchase his holding on the Atkinson estate; how many acres of this holding are evicted land formerly in the occupation of a man named Devane; whether Devane has been provided with a holding; can he say what action the Estates Commissioners propose to take with regard to the evicted tenant's holding now in the possession of Wallace; and whether he is aware that Wallace holds large estates in fee in county Tipperary and King's County.

The answer to the first part of the question is in the affirmative. The Estates Commissioners are not at present in a position to say what action they may take in reference to Mr. Wallace's application, as the estate cannot be dealt with for some time. The Commissioners have received an application for reinstatement from Mr. William Devane, who stated that he was evicted in 1896 from 17 acres of Cangort Park. The Commissioners offered to provide him with another holding, but he refused the offer. I have no information as to whether Mr. Wallace holds any lands in fee.

I am afraid there is no power to do that, but if any information is forthcoming to show that any person has obtained advances improperly the matter will be investigated.

There are certain Poor Law returns, but it would be very difficult to go through them in order to get this information and to identify particular persons?

But the information can be obtained by making an inspection of the register kept under the Registration of Titles Act?

The same difficulty as to identifying a particular person would arise there.

Cannot the Land Commission ascertain if a James Wallace is creating a mortgage for an amount exceeding ten times the annuity?

The Land Commission has a great deal of work to do, and cannot give up the whole of their time to hunting up particulars of this nature.

Several other HON. MEMBERS rose.

Order, order. We cannot give the whole of the time to supplementary questions.

asked the Chief Secretary whether he can say if William H. Atkinson applied to the Estates Commissioners for an advance of £6,322 to purchase certain lands on the Atkinson estate, King's County; whether he has been returned to the Estates Commissioners as a yearly tenant; whether, before the Estates Commissioners sanction this advance, they will satisfy themselves of the nature of this tenancy; and whether this transaction is other than a friendly arrangement between members of the same family to extract from the Treasury a large sum of money, the consideration between the parties being natural love and affection?

My right hon. Friend has already informed the hon. Member, in reply to a question asked by him on 19th July, that Mr. Atkinson has applied for an advance of £6,322, and that he has been returned to the Estates Commissioners as a yearly tenant. When the estate is being dealt with by the Commissioners in order of priority, due inquiry will be made as to the matters referred to in the question.

Will the right hon. Gentleman inquire into this special case? This man was never a yearly tenant.

I really know nothing more than I have already said. It is utterly impossible for a Minister to spend all his time in investigating every case of this nature in Ireland.

Seeing that this fraud is being daily practised in Ireland, and persons holding large tracts of land are getting enormous sums of money, will the right hon. Gentleman direct the attention of the Estates Commissioners to the matter, and ask them to exercise more care?

They have already directed my attention to cases in which fraud is alleged, and I have ordered proceedings to be taken. It is, therefore, not necessary for me to call their attention to the matter.

Is it not the fact that during the Debates on the Land Purchase Bill attention was frequently called to the possibility of frauds of this kind?

Scully Ranch Bomb Explosion, Kilkenny.

asked the Chief Secretary whether he is aware that a newly erected house on the Scully ranch, near Tullaroan, county Kilkenny, the property of a man named Patrick Campion, was recently partially destroyed by a bomb explosion; whether he is aware that the division of those lands by the Estates Commissioners occasioned some disturbances in the locality, which were followed by prosecutions; and, if so, what action he proposes to take?

I am informed by the constabulary authorities that Campion's house was partially destroyed, as stated, by an explosion on 6th August. The prosecutions to which the hon. Member refers were in November last. The police are investigating the matter, and all necessary protection will be given to Campion.

Clare Shooting Outrages.

asked the Chief Secretary whether he is aware that Mr. John A. Studdert, a Clare land agent, was shot at a few days ago from the roadside as he was cycling back from Cloony to his residence at Cragmoher; whether the police have succeeded in making any arrest in connection with this outrage; whether he is aware that two other shooting outrages have occurred in the same county, one at Ballinruan, about ten miles north of Ennis, and another at the house of a farmer named O'Neill, midway between Ennis and Inagh; and, if so, what steps does he propose to take?

I am informed by the constabulary authorities that Mr. Studdert was fired at as stated on 9th August. In the other two cases referred to in the question shots were fired into houses by night on 7th August and 18th July respectively. No arrests have been made. The police are doing all they can to prevent such occurrences, and to detect the guilty persons, but it is obviously difficult to do so in the case of offences committed under cover of darkness.

Leitrim County (Extra Police Tax).

asked the Chief Secretary whether he is aware that the Local Government Board have deducted a sum of £292 for extra police tax from the amount of money payable to the Leitrim County Council out of the Local Taxation Fund; and whether, having regard to the fact that the county council protested against the importation of extra police, their services not being required, as the county was in a peaceable condition, the Local Government Board were justified in thus penalising the ratepayers of Leitrim; and whether he will make representations in the proper quarter with a view of having this amount refunded?

On the 12th August the Lords Justices made an Order under Section 80 (2) of the Local Government (Ireland) Act, 1898, for the deduction from sums payable from the local taxation account to the county council of Leitrim of a sum of £292 10s. 6d., due to that body in respect of extra police expenses for the half-year ended 31st March, 1909. The amount has been paid over to the Inspector-General, Royal Irish Constabulary, and a copy of their Excellencies' Order has been forwarded in the usual course to the Local Government Board with a view to its deduction in the next allocation to be made by that Department of grants from the local taxation account. The answer to the concluding paragraph of the question is in the negative.

Had the county council received any notice of the intention of the Local Government Board to take proceedings?

The proceedings are not taken by the Local Government Board. It is the Lord Lieutenant who makes the Order.

Have the county council a right of appeal against a decision of this nature?

No, Sir. The Lord Lieutenant has an absolute right to make deductions in respect of any amount due from the council.

Is it not the case that under this provision any landlord in Ireland who wishes can deliberately obstruct the working of the Land Act and therefore involve the taxpayer in enormous taxation?

Catholic Magistrates, County Londonderry.

asked the Chief Secretary whether he will state the name and address of the present lieutenant of the county of Londonderry; by whom his appointment was recommended, and the date of his appointment; whether he will state the number of Catholics who have been appointed justices of the peace in the county of Limerick since he received the appointment, and the number of other religions; whether he has refused to approve of the appointment of Catholics whose names were submitted to him either locally or by the Lord Chancellor of Ireland; if he will state the number of Catholics and non-Catholics present in the commission of the peace for the county of Londonderry; and will he state the proportion of Catholic to non-Catholic inhabitants in the said county?

Mr. John Cooke, of Foyle View, Londonderry, is the lieutenant of the county of Londonderry. He was appointed to that office by His Majesty on 24th January, 1908. Twenty-five new magistrates have been appointed on his recommendation, of whom ten are believed to be Catholics. I have no means of knowing what names have been submitted to him locally, but I am aware that he is acting in full accord with the Lord Chancellor, with whom he is in constant communication on the subject of the magistracy. The number of magistrates of the county is 180, of whom 54 are believed to be Catholics. The male population of the county in 1901 was 50,824, of whom 20,966 were Catholics.

Is it within the right of the Lord Chancellor to appoint magistrates irrespective of the recommendations of the Lord Lieutenant?

Is it customary to give appointments to the minority in preference to the majority in Ireland—

That matter does not come under the jurisdiction of the Law Officers of the Crown.

Wexford County Council (Rate Collection).

asked the Chief Secretary whether his attention has been called to a resolution passed by the Wexford County Council asking for discretionary power for county councils to alter the periods for closing the rate collection; and whether, as in counties where the majority of the ratepayers are agriculturists, the present periods for closing the collections inflict hardship, he will consider the advisability of introducing legislation in the direction indicated in the resolution?

The Local Government Board have received the resolution of the Wexford County Council referred to in the question. With regard to the latter part of the question, the Board have power under the Public Bodies Order to grant an extension of time to any collector for the completion of his collection when they are satisfied that the collector is unable for reasons beyond his control to complete the collection within the prescribed time. There does not, therefore, appear to be any necessity for legislation.

Evicted Tenants (Ireland).

asked the Chief Secretary for Ireland whether he can state the number of evicted tenants that have been restored to their farms or provided with new ones under the Act of 1907; and whether the Estates Commissioners have purchased or have now on hand any untenanted land in county Doegal, and, if so, how much and where, to provide farms for those still without holdings?

Two hundred and four evicted tenants or representatives of evicted tenants have been provided for by the Estates Commissioners on the lands acquired under the provisions of the Evicted Tenants Act, 1907. Proceedings for the acquisition of some 325 acres of untenanted land in the county Donegal are at present pending under that Act.

Is the right hon. Gentleman aware that it is impossible to get evicted tenants in Ulster reinstated? Why do not the Estates Commissioners give some consideration to the claims of Ulster evicted tenants?

I never heard of any difference between Ulster and anywhere else. There are very few in Ulster, as a matter of fact.

asked the Chief Secretary for Ireland whether he can say what steps, if any, have been taken by the Estates Commissioners to restore Andrew Conaghan to his farm in Blairstown, on the Bustard estate, near Castle-fin, East Donegal, from which he was evicted, or to provide him with a new holding?

The Estates Commissioners have inquired into and considered Andrew Conaghan's application for reinstatement in a holding on the Bustard estate, and have decided not to take any action in the matter.

asked whether the Estates Commissioners are in negotiation for the purchase of 150 acres of untenanted land on the estate of Henry Cole Bowen, Farahy, Kildorrery, county Cork; and, if not, whether the Commissioners would consider the desirability of acquiring the land in question to provide for the needs of evicted tenants and others under the provisions of the Land Purchase Act of 1903?

The reply to the first part of the question is in the negative. The owner has not instituted proceedings for the sale of the lands referred to under the Irish Land Act, 1903, and the Estates Commissioners have no power to acquire lands compulsorily under that Act.

National Teachers, Ireland (Supplemental Grant).

asked the Chief Secretary for Ireland why the supplemental grant for the salaries of Irish national teachers made last year, and known as the Birrell grant, has not been added to the salaries of the teachers entitled thereto and paid quarterly along with their salary, instead of at the end of the financial year in a lump sum; is he aware that the system of paying it at the end of the financial year has caused inconvenience to the teachers entitled to it; and will he cause inquiries to be made with a view to arranging for quarterly payments along with the salary in future?

I am informed by the Commissioners of National Education that when the first payment from this grant was made it was impossible to provide for the payment of arrears in respect of the year ended 31st March, 1908, and also for quarterly payments during the year 1909, the whole sum made available by the Supplemental Vote in July, 1908, having been required to meet the claims for the former period. It was then arranged that in future years the grant should be paid in April immediately after the conclusion of the financial year, and this arrangement cannot now be altered.

May I ask if the refusal to pay this supplemental grant quarterly is due to the delay in the payment of the money by His Majesty's Treasury, or the inherent objection on the part of the officials of the National Education Office in Ireland to do their work in a business like manner?

The money is paid by the Treasury, and it is impossible to pay the salary and the aditional grant until the latter is paid by the Treasury.

Would it not be a more businesslike transaction to add the supplementary grant to the salaries of the teachers, and pay them together quarterly in one cheque?

Bengal (New Reform Act).

asked the Undersecretary of State for India whether he can now say when the rules for bringing the new Reform Act into operation in Bengal are likely to be issued?

As I informed the House in my statement on the Indian Budget, every endeavour is being made to expedite the preparation of the Regulations under the Councils Act, but the Secretary of State is not yet able to say exactly when they will be issued. The delay will not be more than a few weeks.

Somaliland (Sirdar's Report).

asked the Under-Secretary of State for the Colonies whether any decision has been come to on the Report made by the Sirdar on Somaliland.

I am not at present in a position to make a statement on the subject.

Ceylon Police Service.

asked whether, under the terms of the circular issued by the Colonial Office in April this year anent the establishment of probationerships from which vacancies in the Ceylon police service are to be filled, only British subjects of European descent may enter for the competitive examinations; and what are the reasons for thus barring out Singhalese gentlemen who possess the necessary qualifications from competing for these positions?

The answer to the first part of my hon. Friend's question is in the affirmative. It is essential that there should be an European element in the force, and this is supplied from the examination at home. The local element, which is also necessary, is supplied by local appointments.

Do I understand that Singhalese are still eligible to set in a competitive examination to enter for this service?

As to the precise dividing line, I would wish my hon. Friend to kindly put down a question.

Is this a new regulation which is intended to bar out native Singhalese and to reserve the whole of the police service to persons of European descent?

No; there is no intention to bar out Singhalese or to reserve the whole of the police service for Europeans. The exact contrary is the case, as I said in my first answer. With regard to the dividing line, as I said, if the hon. Member will put down a question, I will give him an answer.

Can he say whether a Singhalese gentleman in this country is eligible for competition?

Licensed Persons as Postmasters.

asked the Postmaster-General if there is a dispensing power in himself to appoint, on a vacancy, as postmaster a licensed person in the case only of sale of liquor for consumption off the premises, under the rule No. 24 ( b ) of 1907, and if he claims any dispensing power in those cases where the applicant has a licence for consumption of liquor on the premises; and, if so, will he state under what Rule?

The Rules made by the Postmaster-General are intended for the guidance of his staff. He is at liberty himself to vary them or alter them at any time. The powers of appointment conferred on the Postmaster-General by Patent from the Crown are unfettered. I may add, however, that, as I have more than once stated in the House, post offices are not opened on licensed premises except under very exceptional circumstances, and the numbers of these are reduced from time to time where possible.

Postal Orders (Payment to Banks).

asked the Postmaster-General if country postmasters are sometimes obliged to ask the local banks to postpone till next day the presentation of the postal orders they have for collection, on the ground that their cash is insufficient; and, if so, if he will take steps to enable the Post Office to fulfil its obligations and to prevent loss to the banks?

It appears occasionally to have happened that at small offices the sub-postmasters have been obliged to ask the local banks to postpone till next day the presentation of the postal orders they have for collection, on account of insufficient cash. When any such cases are brought to light steps are taken to avoid a recurrence. If the hon. Member will give me any case he has in mind, I shall be very glad to inquire into it.

Clondra, County Longford (Delivery of Letters).

asked the Postmaster-General why the Post Office authorities decline to deliver letters addressed to Clondra, county Longford, the ancient name and present name of the village, and insist instead that no letters not addressed as to Richmond Harbour will be delivered; and will he direct that the ancient Irish name of this village will be recognised in future by the postal authorities?

Clondra, Longford, is a well-known place and I am assured that the hon. Member is under a misapprehension in supposing that letters so addressed would not be delivered. If my hon. Friend will send me particulars of the complaint made to him I will have inquiry made.

Postman's Loss of Stripes.

asked the Postmaster-General whether, in the case of Michael Maguire, a postman of Longford, who some years ago lost three stripes, and whose record since has been very good, he can see his way to restore this man to his former status in the service?

If Mr. Maguire's record continues to be good, one of the forfeited stripes will be restored to him during the present month, and he will eventually become eligible for the full number of six stripes. There will be, however, a permanent loss of four years.

Post Office Contracts (Ireland).

asked the Postmaster-General whether he can state the number of postmen and telegraph messengers now employed by the Post Office in Ireland; whether any contracts for the supply of clothing, caps, boots, etc., are placed in that country; if so, can he give the names of the contractors; and, if not, will he say why a portion of these orders is not placed in Ireland?

Uniforms are supplied to 7,450 postmen and 1,362 telegraph messengers employed in Ireland and the whole of the uniform clothing needed in Ireland is made by two Irish firms, namely, Messrs. J. Ireland and Son and the Limerick Clothing Factory. Three Irish firms tendered for the supply of boots, but at prices too high for acceptance; and of several Irish firms asked to tender for caps and waterproofs none replied.

Is it not the fact that the tenders for boots with samples were sent over to this country, and that a few years ago they were sent to the local stores in Dublin when there was an opportunity of the contracts being made in the country?

I am not aware of that fact. For some time past at all events, again reverting to the old custom, I think it has been necessary to send them to London, and I should think it more convenient, because the various specimens can be compared, but I will look into that point.

When will the Report of the Departmental Committee, which the right hon. Gentleman appointed to consider the question of Post Office stores in Ireland, be available?

Soldiers as Telegraphists.

asked the Postmaster-General whether his attention has been drawn to an order issued by Major-General Bunbury of the Administrative Department of the Irish Command, at the instance of the postal authorities, to the effect that only a small number of soldiers have entered for examination as telegraphists, and urging them to enter for examination with a view to becoming telegraphists; whether that order was issued with his sanction; whether it is his intention to put soldiers into competition with the Civil servants who now perform the duties of telegraphists throughout the country; and whether similar orders have been issued to the military authorities in England and Scotland?

Arrangements made so long ago as 1897 by the Government of the day oblige me to reserve yearly a certain number of appointments as postmen and porters for ex-soldiers or ex-sailors. If some of these ex-soldiers or ex-sailors could qualify to become telegraphists I should consider it advantageous to appoint them as such, since the appointments as postmen which they would otherwise have filled would then be available for telegraph messengers. No question arises of the soldiers being put into competition with the Civil servants who now perform the duties of telegraphists. They will enter by an examination in the same subjects as the ordinary telegraphists, and will have to obtain the ordinary Civil Service certificate. The position and rights of the telegraphists are not thereby in any way affected. I have, of course, no responsibility for orders issued by the War Office.

Kelway Sound-locating System.

asked the Postmaster-General whether he has received from Mr. C. E. Kelway a letter, dated the 14th August, 1909, pointing out that it would appear that the Admiralty restrictions to the use of the Kelway sound-locating system at Dover and on the South and South-East Coasts of England were no longer in force, and asking him whether he was now prepared to grant a licence under the Wireless Telegraph Act for the use of the Kelway Hertzian-wave apparatus in time of fog in those parts and generally throughout the United Kingdom; and, if so, will he explain why a definite reply in the affirmative has not been given to Mr. Kelway in view of the losses in fog in the parts named and generally around our coasts?

Mr. Kelway's letter of the 14th ultimo was duly received, and its receipt acknowledged. I am in communi- cation with the Admiralty on the subject, and will send a definite reply to Mr. Kelway as soon as possible.

Is the advantage to humanity to be entirely lost through official red tape?

There is no question of red tape in connection with the matter. The question of interference between, stations is a matter of great importance, and it would be far worse from the point of view of humanity to have erected a station which was ineffective because it was interfered with by another station and which rendered that station ineffective by interfering with it. It is only on that ground that there has been any delay in regard to this matter.

Parish Magazines (Postage).

asked the Postmaster-General whether he is aware that a number of parish magazines issued all over the Kingdom are delivered by hand owing to their being charged 1d. postage; and whether he could see his way to place them on the same footing as newspapers?

I have no discretion in the matter. The publications which enjoy the advantages of cheap postage are those which conform to the statutory definition of a newspaper contained in the Post Office Act of 1908, and unless a particular paper conforms to the statutory definition it cannot be conveyed at the cheap rate. But I may point out to the hon. Member that a parish magazine can, under the present half-penny post regulations, be sent for a postage of ½d. if its weight does not exceed two ounces.

Mail Drivers (Belfast).

asked the Postmaster-General whether he is aware that there are 11 mail drivers in Belfast employed as follows: two who work 93 hours each for 21s. 6d., four who work 86, 84½, 84, and 79¾ hours for 21s. 6d., four others who work 86½, 76½, 61½, and 57 hours each for 20s., and one man who works 49 hours for 12s.; whether he is aware that the uniform of these men consists of coat, vest, and cap only, whereas the ordinary postmen receive two full suits, including overcoat, waterproof cape, and boots, per year; whether he is aware that the recent inquiry held in Belfast respecting this matter consisted of calling in the contractor's foreman and accepting his statement, without in any way approaching the persons employed; and whether, in view of the statement that the hours worked by mail-cart drivers in Belfast were 60 per week for 21s. 6d., with uniform, he will take the necessary steps to enforce the hours and wages as aforesaid, with the addition to the uniform of trousers, boots, overcoat, And waterproof cape?

The inquiries which I am making in this case are not yet completed, but I will send my hon. Friend a reply as soon as possible.

I think I recently had a report from Dublin. I will look into the matter, if the hon. Member will give me notice.

Sub-Post Office (Chapel Ash, Wolverhampton).

asked the Postmaster-General whether he is aware that the sub-post office at Chapel Ash, Wolverhampton, has been removed from a very convenient spot to a part less convenient for the inhabitants of the district; whether he is aware that this office has for 21 years been solely used for postal purposes, and that at the present time it is being conducted by a sub-postmaster with no previous experience, and who has commenced a stationery and newspaper business in competition with one struggling tradesman whose takings have been reduced during the two months that this subsidised business has been in operation by no less a sum than £2 per week; whether he is aware that the town council has expressed disapproval of reducing this office from one devoted solely to postal affairs to one connected with a business; whether he will consider the desirability of consulting such bodies before such changes are made; whether he can either raise the salary of the present sub-postmaster in order that he may live without trading, or whether he is prepared to pay adequate compensation to the tradesman already mentioned; and whether he is prepared to take any action in the matter?

The facts in regard to Chapel Ash are as follows:—It was represented to the Post Office by the town council and others that the existing sub-post office at Chapel Ash was inconvenient both in regard to situation and accommo- dation. On the resignation of the sub-postmistress, therefore, it was thought advisable to seek better premises. Under Treasury Regulation the amount of business transacted at Chapel Ash only enables a small salary to be paid for a salaried sub-office; and under such an arrangement the accommodation which the town council and others appeared to desire could not be provided. It was thought better, therefore, to turn the office into a commission sub-office, and thus to obtain for the public facilities and conveniences greater than those that could be provided under the other system. The usual advertisement was inserted, but none of the shopkeepers whose premises are in a suitable position came forward as candidates for the post. The premises of the tradesmen to whom the hon. Member refers were not thought to be sufficiently central, or to meet the needs of the neighbourhood. Another offer which was received appeared to provide adequate accommodation in what is believed to be the best situation, and the offer was therefore accepted. The sub-postmaster who has been appointed, and his wife also, are acquainted with the business of a sub-office, and were thought to be unusually desirable candidates. I am informed that the business which will be carried by the new sub-postmaster is not thought likely to interfere to any appreciable extent with any existing business. I may add that the Parliamentary Committee fixed £250 as in the ordinary course, the total emolument which would justify the institution of a salaried office. The remuneration at Chapel Ash is considerably below that figure.

Is not the right hon. Gentleman's action in this case in complete contradiction to the recommendation of the Committee, that these offices should be gradually placed under a direct salaried office?

No, my hon. Friend is mistaken in that. The recommendation of the Committee was that all offices of a certain size should be placed under salaried officers. They did not suggest that smaller ones should be.

Is the right hon. Gentleman aware that the application was sent in from the very place where this sub-post office used to be 21 years ago? Is he also aware that the person now appointed—

Post Office Buildings (Stafford).

asked the Postmaster-General whether the site for the new post office at Stafford has been decided upon; if so, whether the site chosen is in Eastgate-street; whether, before anything definite is done, he will take steps to consult the town council of Stafford, who consider that any new post office in Dr. Maston's house or on that site would be in a ridiculous position, owing to its being entirely out of the way; and whether it would be advisable, as far as possible, to consult the premier governing body of a town when the convenience of its inhabitants is under consideration by the postal authorities?

No decision has yet been arrived at as regards a site for a new post office at Stafford, and the local feeling which appears to have been aroused is based therefore on a misapprehension. Various offers of sites have been received in reply to advertisement, and are now under consideration. I have already recognised the advisability of ascertaining the town council's views before a particular site is selected, and reference was, as a matter of fact, made to the council in regard to a site which was under consideration last year. I may take the opportunity, however, of pointing out that negotiations for the purchase of sites which are subjected to undue publicity are apt to come to nothing. When the Post Office is known to be in the market, holders of sites are disposed to ask more than I am prepared to pay.

Primary Instruction Bill (Jersey).

asked the Secretary of State for the Home Department whether his attention has been called to the fact that the Primary Instruction Bill which received its third reading in the States of Jersey on 5th August, 1909, by the majority of 28 to 21 votes, was passed without reference to the electorate; whether he is aware that the president and three of the other members of the Primary Instruction Committee to be established by the Bill are the bailiff and three jurats, who are also president and judges of the Royal Court of Jersey, so that the same persons will be called on incidentally to interpret the law judicially after having decided it administratively, and this with power to modify or annul trust deeds of voluntary and other schools; and whether he will take these circumstances into consideration before recommending its confirmation by the Privy Council?

I understand that the usual procedure was followed in the case of this Bill, and that the constitution of the education committee under the Bill is the same as that of the existing committee. All the circumstances or allegations mentioned by my right hon. Friend will be taken into consideration in dealing with this matter.

When is this matter likely to come before the Committee of the Privy Council, and what is the constitution of the Committee of the Privy Council?

I believe it is now before the Privy Council. It has not come before me in any shape. I cannot answer the last question.

Duration of Session.

asked the Prime Minister whether he is now in a position to state the date on which this Session will end?

Development Bill.

asked when it is proposed to take the second reading of the Development Bill?

Perhaps the hon. Member will await my statement on the Business of the House?

Agricultural Rating Act (Renewal).

asked why the Agricultural Rating Act is, under the Expiring Laws Continuance Bill, only to be renewed for a period of nine months from the date of its expiry, instead of for the longer period for which it has been previously renewed?

asked why it is proposed' to continue the Agricultural Rating Act, 1896, until 31st December, 1910, that is, for a period of nine months only after 31st March, instead of for a full financial and rating year?

The reason why the Agricultural Rates Act is continued for a shorter period than previously is that it is now proposed to continue it by the Expiring Laws Continuance Bill instead of by a special Bill confined to that Act alone. It is the custom to continue all Acts continued by the Expiring Laws Continuance Bill only to 31st December in the year succeeding that in which the Expiring Laws Continuance Bill is passed.

Workmen's Dwellings (Merthyr).

asked the Prime Minister whether his attention has been drawn to the action of the proprietors of the Wingfield and Mackintosh estate, Abercanaid, Merthyr, who have refused to sell or lease land to the Merthyr Borough Council for the erection of workmen's dwellings on the plea that the housing scheme of the council does not seem to be of any advantage to the estate; and whether it is intended, by legislation or otherwise, to take from landowners the power to withhold land when required for housing or other public uses?

The Prime Minister has asked me to reply to this question. The town council have sent me a copy of a letter which they have received from the solicitors to the owners of the estate referred to, and which is to the effect stated in the question. Local authorities are already empowered by Section 57 of the Housing of the Working Classes Act, 1890, to apply to the. Local Government Board to enable them to purchase land compulsorily for the purpose of providing houses for the working classes, and, I may add, that under the Housing, Town Planning, etc., Bill now before Parliament, the procedure in relation to this matter is proposed to be considerably simplified and improved.

Parliamentary Papers (Newspaper Press).

asked the Prime Minister if he will cause instructions to be issued to the various Departments of State that Papers relating to important matters of administration, upon which this House is entitled to express an opinion and in which the constituents of hon. Members are closely interested, shall be supplied to Members of this House in the first place, and that the practice of issuing such Papers primarily to the newspaper Press and only subsequently to this House shall cease?

The hon. Member is mistaken in supposing that there is any such practice as that to which he refers in the latter part of his question. The ordinary and proper procedure is that Parliamentary Papers are supplied to Members of this House in the first instance.

Is the right hon. Gentleman aware that since the unfortunate occurrence in regard to the Memorandum on the Development Bill an important Paper of the Board of Education has been issued to and commented upon by the newspaper Press generally, though it is not available for distribution?

I do not know about that. I do not know that it is a Parliamentary Paper.

Is the right hon. Gentleman aware that Parliamentary Papers are sometimes distributed three or four or more days after they appear in the Press?

Will the right hon. Gentleman issue some instructions so as to ensure that the practice is carried out?

Von Veltheim Case.

asked the Home Secretary whether he is aware that the statements put in after the conviction of Von Veltheim and before his sentence were not put in by the police in the ordinary way, but were put in by a detective who had been previously privately employed by the prosecutor; and what steps he proposes to take in view of that fact?

I have made inquiries, and learn that the statements referred to were put in in the ordinary way by the police officer engaged in the case. He is an officer of the City of London Police, and was never in the employ of the prosecutor.

Are we to understand that the information was not supplied by a detective who had been in the paid employ of the prosecutor and that that was the only source?

I have answered according to information which has been given me and which I have no doubt is accurate.

Sentences on Youthful Offenders.

asked the Home Secretary whether he is aware that at the Manchester city police court five youths, the youngest of whom was but 17 years, were sent to prison for three months for stealing articles from the goods arches of the London and North-Western Railway Company; whether due precautions are taken to guard such articles; and whether, in view of the advice of his Department with respect to first offenders, he can take steps to reduce this sentence imposed on the children of poor parents?

I am making inquiry into this matter, but have not yet had time to obtain a report. When my inquiry is completed I will communicate the result to the hon. Member.

Disturbance in Liverpool (Inquiry).

asked the Home Secretary if he has received from the Watch Committee of Liverpool a recommendation to hold an inquiry into the recent disturbance in that city; if so, does he propose to grant an inquiry, and on what date; will the inquiry be held on oath; and will the Press be admitted?

Coal Mines Regulation Bill (Instruction).

asked the Home Secretary whether he will agree to an Instruction before going into Committee on the Coal Mines Regulation Bill, to enable a clause to be moved making it clear that the 60 hours' overtime provided in the Coal Mines (Eight Hours) Bill is not intended to be of general application, but only to meet the special circumstances of certain districts?

The declaratory clause suggested with regard to the 60 hours' overtime allowed by the Act for emergencies and trade pressure would be outside the scope and title of the Bill.

The point of my question is whether the Home Secretary will agree to an Instruction being moved to overcome that very difficulty.

The question might arise if I thought the Bill had any reasonable prospect of being proceeded with this Session, but it can only be proceeded with if it is uncontentious.

Royal Navy Contracts (Food, Clothing, etc.).

asked the First Lord of the Admiralty whether any contracts for food, clothing, boots, etc., for the use of sailors in the Royal Navy have been placed in Ireland; if so, will he give the names of such contractors; and, if not, will he see that that country gets a share of the contracts; and will he say what is Ireland's contribution to the upkeep of the Navy?

The answer to the first part of the question is generally in the affirmative. With regard to the second part, arrangements have recently been made for the periodical publication in the Board of Trade "Labour Gazette" of the names of successful tenderers. As to the third part of the question, all competent firms who desire to tender for Admiralty contracts are treated on exactly the same footing, irrespective of the particular part of the United Kingdom where they may happen to be located. The Irish contribution to naval expenditure for 1908–9 calculated on the basis of 0.66 per cent, of the whole cost, would amount to £202,440.

May I ask the right hon. Gentleman whether he can see his way to have a depot established in Ireland where specimens of the various articles required might be sent so as to give manufacturers in that country an opportunity of competing without having to incur the extra expense of sending articles over here?

I did not hear the whole of the hon. Member's question. If he will put it on the Paper I will be happy to give him an answer.

Torpedo Factory, Greenock (Painters and Fair Wages Clause).

asked the First Lord of the Admiralty whether he is aware that the firm of Messrs. H. L. Anderson and Company, sub-contractors for painting work at the new torpedo factory, Greenock, are employing labourers at labourers' rates of wages to do work ordinarily done by painters at painters' rates; and whether he will take steps to have the terms of the Fair Wage Clause complied with?

The labourers referred to were employed scraping and cleaning the ironwork preparatory to painting; the sub-contractors are now, in fact, employing painters to do this work. The sub-contractors are bound to observe the Fair Wages Clause, and no further action seems to be called for in the present instance.

Is the right hon. Gentleman aware that the work referred to is considered painters' work, and, having regard to that, will he take steps to see that the Fair Wages Clause adopted this Session is given effect to?

I am not an expert in the quality of the work, but as the contractors say that painters are now being employed to do the work, there does not appear to be any occasion for further action.

Woolwich Arsenal (Admiralty Orders).

asked the First Lord of the Admiralty whether, having regard to the fact that his predecessor gave a pledge in this House to give Woolwich Arsenal a fair share of Admiralty orders, he will state what orders have been so placed compared to the one-third given by the War Office to the Royal Arsenal; and does he propose to give, either now or at an early date, any gun-mountings to Woolwich?

The approximate value of the orders for new work placed with Woolwich since 31st March, 1909, is:—

The ordnance factory is now being requested to tender for a large number of transferable gun-mountings.

Rosyth Dock Works.

asked the First Lord of the Admiralty whether his attention has been called to an accident on the new dock works at Rosyth by which a lad's leg was fractured; whether he is aware that the lad was conveyed to Dunfermline Hospital; and will he state the distance from the works to the hospital and the kind of conveyance used on this occasion?

The accident referred to occurred on 24th August, and was duly reported by the contractors to the Admiralty Superintending Engineer. First aid was available on the spot, and the leg was put into splints. The lad was then conveyed to Dunfermline Hospital at the request of his father, who is also employed on the works. The distance from the works to the hospital is about 3½ miles; the journey was made in the contractor's motor car, the lad being accompanied by one of the sub-agents.

asked the First Lord of the Admiralty whether the doctor employed to attend the workmen at the new works, Rosyth, is also engaged in private practice; and what are the terms of his engagement, including salary?

The doctor engaged by the contractors to attend the workmen at the new works at Rosyth is engaged in private practice in lnverkeithing. The contractors have arranged that he shall attend all accidents on the works when required, also the men and their families in sickness at their own houses. The question of salary is one for the contractors.

Is the right hon. Gentleman aware whether the salary, whatever it is, is paid by the contractors or deducted from the wages of the workmen?

American Cattle Imports.

asked the hon. Member for South Somerset, as representing the President of the Board of Agriculture, whether he is aware that the importations of American cattle into this country fell from 344,461 in 1907 to 260,711 in 1903 on account of the scheduling of an area of over 174,000 square miles in the United States under the Board's Order through the prevalence of foot-and-mouth disease; whether he has any official information showing that the outbreak was due to the importation into America of contaminated vaccine virus by manufacturers of vaccine, and involved the loss of many hundreds of thousands of dollars; whether every recent outbreak of foot-and-mouth disease in America originated on a vaccine farm; and whether, in order to minimise the risk of a similar calamity in England, he is prepared to recommend that the importation of vaccine into this country be prohibited?

The decline in imports of cattle from the United States in 1908 was attributable to other causes than merely the scheduling of certain States, which did not take place till late in November of that year. The Department of Agriculture for the United States issued a Report last June—Circular 147—as to the origin of the recent outbreak of foot-and-mouth disease in that country, and the conclusions therein arrived at are, in short, those mentioned by my hon. Friend. The Board are considering what, if any, steps can be taken to guard against a similar occurrence in this country, and they will bear in mind the suggestion made.

Development in Ireland (Motor Service).

asked the Vice-President of the Department of Agriculture (Ireland) if, in preparing any draft scheme of development for Ireland in view of a Development Act, he will have included for favourable consideration the institution of a regular motor service for goods and passengers between Castlepollard and Athboy?

I think this question is premature. I must ask the hon. Member to wait until the Bill is passed.

Margarine and Butter Blending Factories (Ireland).

asked the Vice-President of the Department of Agriculture (Ireland) if he can state the number of margarine factories in Ireland; whether they are receiving any technical instruction or advice from the Department; and, if not, whether the Department intends to continue to allow margarine to be exhibited at its produce shows?

had also given notice of the following question: To ask the Vice-President of the Department of Agriculture (Ireland) what is the present number of butter-blending factories in Ireland; whether they are receiving any technical instruction or advice from the Department; and, if not, whether the Department intends to continue to allow the produce of such factories to be exhibited at its produce exhibitions?

I will answer these two questions together. There are six margarine factories in Ireland. Up to 31st August 90 butter factories were notified to the Department as having been registered with local authorities. The Department have no special scheme for affording advice and instruction to these factories, but as far as practicable they afford all necessary advice and assistance when such is desired. The Department see no reason to make any change in the present arrangements.

Food Products and Inspection (Ireland)

asked the Vice-President of the Department of Agriculture (Ireland) if he will state what responsibility his Department takes for the produce of creameries at present exhibited by them at their produce shows, and what responsibility does it take for bacon, jams, and other manufactures; why the Department are willing, without imposing any special conditions, to exhibit all articles of food except butter at these shows, even though the factories in which they are produced are not visited by the officials of the Department or receiving any technical advice; and, in view of the fact that the Department's recent action in excluding about 300 creameries from one of these shows is looked on as an attempt to coerce these concerns to send butter to the Department's surprise competitions, he will see his way to place all creameries on the same footing as factories producing other classes of provisions?

The Department have in operation a scheme under which a very considerable sum is expended annually in improving the produce of creameries by means of visits of instructors, surprise butter competitions, and otherwise. Similar schemes are not in operation in regard to the other manufactures referred to, and consequently the same regulation as regards admission to the produce shows is not applicable in these cases. The Department afford, as far as practicable, all necessary advice and assistance to manufacturers exhibiting at these shows, and they cannot see their way to admit exhibitors who refuse to benefit by the facilities afforded for instruction. It is not correct to say that 300 creameries have been excluded from these shows, and that the Department have endeavoured to coerce creameries to take part in the surprise butter competitions. The number of creameries which, owing to their unsatisfactory condition, or to the refusal of the managers to conform to the regulations, are excluded from the Department's scheme is scarcely one-fourth of that number. My right hon. Friend does not propose to alter the regulation referred to. It is open to the proprietors of any creamery, if they so desire, to obtain all the advantages afforded by the Department.

Crown Salmon Fishings (Scotland).

asked the Secretary to the Treasury whether he is aware of the negotiations which have taken place between the Woods and Forests Department, Lord Wemyss, and the Peebles Town Council respecting Crown salmon fishing on the Tweed in the vicinity of Peebles; and, if so, whether, pending the introduction of legislation in the near future, the Government in the meantime will only lease this water to pubic bodies and not to private individuals?

had the following question on the Paper in his own name: To ask the Secretary to the Treasury whether he will say what steps the Commissioners of Woods and Forests propose to take to provide that, in the event of the Town Council of Peebles accepting their offer to lease to it the Crown salmon fishings in the vicinity of Peebles, reasonable access will be secured for the public to the river banks?

I may perhaps be allowed to answer this question and that of the hon. Member for Falkirk Burghs together. Negotiations have been proceeding for some time between the Commissioners of Woods, the Peebles Town Council, and Lord Wemyss. It is intended, if possible, to arrange for a lease of the salmon fishing to the town council subject to reservations in respect to that portion of the river which passes the private grounds or policies of Barnes House and Hay Lodge. I am advised that the right of access to the banks conferred by such a lease would be legally exercisable only by such persons as have the necessary permits from the lessees and for the purpose of fishing for salmon. It is usual for lessees to take all necessary proceedings to assert their rights in connection with property held under a Crown lease, but, if at any time a case involving a test question were to arise, the question of assisting the lessees would be considered.

Infantile Mortality, West Ham (Consumption).

asked the President of the Local Government Board if he is aware that the coroner for West Ham on Monday, 30th August, held inquests on five children whose ages ranged from three months to six years; that in each instance a verdict of died from consumption was returned; if he can state whether the houses in which those children had dived bad been recently inspected by the sanitary inspector; and, if so, what condition were they in; and, if they had not been inspected, will he make inquiries with the object of ascertaining what their sanitary condition is?

I have seen a newspaper reference to the inquests referred to, and am making inquiries into the matter.

Motor Accident at Salisbury Plain (Speed Dangers).

asked the President of the Local Government Board whether his attention has been called to the evidence given at the inquest on the body of Gunner Snow on 14th August last, who was killed by a motor car on Salisbury Plain, the driver of which acknowledged that when the accident took place he was driving his car at the rate of 10 to 15 miles an hour into a dense mist, and to the remarks of the coroner at the said inquest, who said, after hearing all the evidence, that the car in question must have been travelling much faster than 10 to 15 miles an hour; and whether he is considering what steps may be taken to prevent persons who, as owners and drivers of motor cars, are guilty of endangering the lives of others from using the public roads in future for the purposes which they have abused?

I have seen a report of the inquest in this case, and I understand that the question whether proceedings should be instituted against the driver of the motor car is under consideration. With regard to the subject generally, I may point out that if a person drives a motor car on a public highway recklessly or negligently or at a speed or in a manner which is dangerous to the public he is liable to penalties, and in the case of a second offence to imprisonment. Moreover, his licence to drive may be suspended, and he may be declared disqualified for obtaining a further licence for such time as the court thinks fit.

Asphalt Pavement, Holborn.

asked the President of the Local Government Board whether he is aware that the contractors to the Holborn Borough Council have recently repaved New Oxford street, between Tottenham Court-road and Kingsway, with asphalt having angles of side-fall greatly in excess of those recommended by the engineers who contributed papers on the subject of modern road-paving before the Road Congresses held in April, 1907, and at the Institution of Civil Engineers in April last; and whether he will introduce such legislation as may be necessary to insure that any London thoroughfares which are in future repaved with asphalt shall have a side-fall to the channel, measured transversely eight feet there from, which shall at no point exceed a slope which is calculated to give motor and horse traffic a secure hold upon the roadway in wet weather, say, a slope of 1 in 30 as a maximum?

I am informed that the fall from the crown of the road to the channel in the portion of New Oxford-street referred to is 1 in 38. I am aware that this is greater than the side-fall recommended at the Road Congresses in Paris, and at the Institution of Civil Engineers, but I understand that it is the slope adopted for asphalte roads in other parts of the Metropolis. The slope of 1 in 30, suggested as a maximum by the hon. Member, would be greater than that which has been adopted in New Oxford-street. It does not seem to me necessary to introduce legislation on the subject.

Import Spirit Duties (United States).

asked whether, before the United States Tariff Act came into force, the import duty on spirits imported into the United States from the United Kingdom was $2.25 per proof gallon, whereas similar spirits imported from France, Germany, Italy, Portugal, Spain, and Switzerland were subject to a duty of $1.75 per proof gallon; and whether this differentiation is consistent with the treaty of 1815, by which the United States agreed to extend most-favoured-nation treatment to this country?

The facts are as stated in the first part of the question. The differentiation mentioned will, however, come to an end with the termination of the Reciprocity Agreements between the United States and the countries named, notice of which has already been given in accordance with the new tariff law. As the hon. Member is aware, the United States Government has always held that the most-favoured-nation clause in the Treaty of 1815 does not apply in the casa of reductions of tariff duties specially accorded under reciprocity agreements with other nations in return for a consideration. I am not to be understood to imply that His Majesty's Government agree with this interpretation.

Revenue and Expenditure (Return).

asked the Chancellor of the Exchequer whether, in the Revenue and Expenditure (England, Scotland, and Ireland) Return, Parliamentary Paper, No. 208, of the present Session, the figures for expenditure on pages 11, 12, and 13, under the head of Voted Civil Government Charges, are net figures or gross figures; and if he will state how appropriations in aid and extra receipts are treated in making up this Return?

The figures are based on Exchequer issues, which correspond approximately with gross expenditure, less appropriations in aid—the gross expenditure and the appropriations in aid under each head being divided according to the respective parts of the United Kingdom in which the expenditure is incurred or the receipts arise. Extra receipts not appropriated in aid of Votes are not taken into account in the expenditure tables, but are apportioned in the revenue tables between the three Kingdoms on a similar basis.

Tobacco and Excise Contributions (Ireland).

asked the Chancellor of the Exchequer, in reference to Return No. 208, Revenue and Expenditure, whether he can explain more fully than is done in the brief marginal note how the sum of £1,706,000 collected in Ireland as Customs duty on tobacco is reduced to £1,309,000 under the heading of true contribution, and the sum of £5,420,000 Excise duties is reduced to £3,153,000?

The "true contribution" of Ireland to the Revenue under the heads of Tobacco (Customs) and Beer and Spirits (Excise) represents the duty on the amounts consumed in that country, so far as they can be ascertained, the method being to deduct from the duty collected the duty on the quantities removed from Ireland duty-paid, and to add the duty on quantities removed to Ireland duty-paid. As regards the precise methods by which the results are arrived at, I may refer the hon. Member to the Memoranda annexed to the Parliamentary Return, House of Commons 329 of 1891, and the prefatory note to House of Commons 225 of 1904, and also to a reply given by the right hon. Gentleman the Member for East Worcestershire, who was then Chancellor of the Exchequer, to a Parliamentary question on 21st July, 1904 (" Hansard," Volume 134, page 771).

BUSINESS OF THE HOUSE.

Is the right hon. Gentleman the Prime Minister in a position now to make a statement as to the business of next week?

We propose on Monday to take the second reading of the Development Bill, and we also hope to get the Committee stage of the Financial Resolution connected with it, and possibly also one or two uncontroversial items of business.

On Tuesday, Wednesday, and Thursday we shall continue the Committee stage of the Finance Bill, and

On Friday we shall take the Report and third reading of the Housing Bill.

Will the right hon. Gentleman say when he is likely to introduce the Police Weekly Rest Bill alluded to in his statement, and when shall we see it in print?

Can the right hon. Gentleman give us any idea as to the length of the sitting which the Government contemplate for to-morrow, as it would be a convenience for Members who are going out of town?

I should not like to name a definite hour. I hope we shall get away by what is commonly known as dinner-time.

DEATH DUTY ASSESSMENT—PERSONAL EXPLANATION.

I should like, with the leave of the House, to be permitted to make a personal statement in connection with an incident which occurred on the last day that we were in Committee [18th August] before we met again yesterday. In the course of the Debate which took place on that day my right hon. and learned Friend the Member for Dublin University (Sir Edward Carson) referred to a speech which I had previously made in reference to the valuation by the Government of a property of mine for the purpose of assessing the Death Duties. He referred to this case as a striking example of how the right of appeal to a court of law from the arbitrary valuations of officials, to use his own wording, "kept those officials in order." The Chancellor of the Exchequer interrupted my right hon. and learned Friend, and afterwards, in his reply, he stated that he was armed with an official Report from the Death Duty Department, and he proceeded to contradict my right hon. and learned Friend's figures and my own figures. The Chancellor of the Exchequer said:— The Commissioners never valued in the case which he quoted at £50.000. The highest value was £12,800, and that was after they had received a valuation fixed by the hon. Member for Stepney, or his advisers, of £5,735. And then he continued:— The facts are that the hon. Member [that is myself], or his advisers, fixed the value at £5,735. The Commissioners put it at £12.800, and finally there was a compromise at £10,000. That is a very different story from that told by the right hon. Gentleman the Member for Dublin University, and is based upon the official documents and the official figures. I desire to say that the Chancellor of the Exchequer has been entirely misinformed.

What are the facts? First of all, what he calls my valuation of £5,737 had been withdrawn months before the settlement was come to, and a new valuation, which I hold in my hand, of £7,936, substituted for it. Secondly, the highest value was not £12,800, as stated by the Chancellor of the Exchequer, but £41,000. With the permission of the House, I will read a short document which shows this to be the case. This is a letter written to me on 8th August, 1900, by the solicitors who were dealing with the property, Messrs. Baker and Nairne, 3, Crosby-square, Bishopsgate:—

"Dear Sir,

" Re J. L. Wylie, deceased.

"Estate Duty on Real Estate.

"On attending at Somerset House before the principal clerk with inference to the value to be placed on Camilla Lacy, he stated that he considered the property was under valued, as the land round it was ripe for building, and that it should be treated and valued as building land. He marked the account as follows:—

"'Apparently quite insufficient in view of the situation of the property and its capacity for immediate development. It must be assumed that purchasers could be found to give £500 an acre for it.—C O. M'"

"Yours faithfully,

"(Signed) BAKER & NAIRNE.

"F. L. HARRIS, Esq.,

"81. Grace church Street, E.C."

And, lastly (but this is a small matter), the compromise was not £10,000, but £10,500. The facts of the case then are as follows: A value of £500 an acre, or £41,000, was placed upon this property by the Chief Clerk of the Estate Duty Office. After much negotiation, involving no less than four separate official valuations, after many months of delay, after an official valuer had been sent down to inspect the property, after I had threatened to fight and had asked to be assessed, and after I had offered to agree to a value of £10,400 in order to avoid litigation, the matter was placed in the hands of the solicitor of Inland Revenue, who recommended a settlement on the basis of £10,500, a reduction of no less than £30,500 of the original value, equivalent to a reduction from £500 to £127 an acre. Unfortunately I was not present when the incident occurred, but I took the earliest opportunity next morning of seeing the Chancellor of the Exchequer and of pointing out to him that he had been misinformed, and had consequently misled the Committee. I understood the Chancellor of the Exchequer to say that he was anxious to put the matter right on the very first opportunity, and that he would do this when we went into Committee yesterday; in fact, he sent me a draft of his explanation which he proposed to make; but, as for some reason he failed to do this, I must thank the Committee for having given me the opportunity of clearing myself from a charge of inaccuracy which has been made against me.

The last statement made by the hon. Gentleman is perfectly true. He came to me and showed me such documents as he had, and I also placed all the official documents at his disposal. I left him and the officials together to clear matters up. I did promise on the first opportunity, which I considered to be a relevant one—that would be on the Estate Duties, which I thought were to come up on Monday—to clear up the whole matter. I also said I would make a statement. What is the position? The right hon. and learned Gentleman the Member for Dublin University (Sir Edward Carson) said the valuers had valued the property at £50,000, and not £40,000. That is the first error, which the hon. Gentleman him- self admits. I stated that it was incorrect, and that I had official documents in my possession showing that the highest valuation was £12,800. Before I made that statement I had the official documents. There was only one valuation, and that valuation was £12,800. The whole of the documents are now in Somerset House. There is no other valuation except the valuation of £12,800. Now the valuation originally put in by the hon. Member was, as he will recollect, a valuation of £5,733. The first valuation by the Commissioners was a valuation of £12,800. The Member for Stepney showed me the documents in regard to the original statement. On that paper an official in the office who was then the chief clerk for Estate Duty, and who has since retired, made a note to the effect that the value suggested by the hon. Member was quite insufficient in view of the situation of the property, and that it must be assumed that purchasers would be found to give £500 an acre for it. This would have amounted, at £500 an acre for the whole estate, to £41,000. In regard to this note no record was kept by the clerk, and consequently there was nothing on the official statement to show that it was ever put forward. It did not, of course, express the opinion of the Commissioners, and the only value ever put forward as representing their opinion was the valuation of £12,810, which was arrived at after the property had been inspected by an expert of the Department. Of course it shows how important it is, both in the interests of property-owners and the public, that there should be an official valuation of these properties.

FINANCE BILL.

Considered in Committee [ 23rd Day ].

[Mr. EMMOTT in the chair.]

(IN THE COMMITTEE.)

CLAUSE 29.—(Duties on Excise Liquor Licences.)

As from the first day of July nineteen hundred and nine, there shall be charged, levied, and paid on the licences for the manufacture or sale of intoxicating liquor specified in the First Schedule to this Act, the duties of Excise specified in that Schedule, and the provisions expressed in that Schedule to be applicable to any such licences shall have effect with respect to those licences.

moved to leave out the words "manufacture or" ["licences for the manufacture or sale of."]

4.0 P.M.

It seems to me that it would have been far more straightforward to have at once put the tax direct on the barrel, and the method proposed by the Bill initiates a new method of taxation. In following this course the right hon. Gentleman lays himself open to the charge of vindictiveness, or else of drawing an invidious distinction in regard to one class of manufacturers. The trade under this Budget will have to bear a very large proportion of taxation, and it is very unfair that the manufacturers should be picked out. The trade object to this distinction. If it applies to one class of manufacturer it might as well apply to all manufacturers. There are many hon. Members sitting behind the Government who are making large sums of money in other industries, and I presume that in initiating this progressive tax they ought to remember that perhaps other Governments may adopt the scheme of the present Government and apply it to other manufactures. An hon. Member sitting behind the Government makes soap. I do not approve of any taxation on manufactures, but it remains to be seen whether those hon. Members who manufacture soap or other articles, and who pay large dividends, should not have this system applied. They are very earnest supporters of the Government and approve of this taxation, which is based upon one class. I think it is a very invidious distinction to place upon them. This progressive tax also imitates another method of taxation which might develop into something ludicrous. For instance, in motor-car licences we might fix a pound for the driver for the first thousand miles, and 12s. extra for every additional 500 miles. You might also have it applied to game licences, to good shots, so that a man who shoots a great deal may have a tax of one sovereign on the first 100 or 200 brace he kills, and a progressive tax of 12s. upon every subsequent 100 brace he kills. If we go further, we might apply it to solicitors, and then a solicitor having paid his duty upon the first 6s. 8d. he receives, would have to pay tax upon the remaining six and eightpences. It is somewhat difficult, I confess, to quite appreciate on what principle this tax is introduced. I think I may say that the principle is wanton. I wish to draw the attention of the Prime Minister to some remarks which he made across the floor of this House on 11th March, 1907—a long time ago. I always appreciate the remarks the Prime Minister makes in his speeches as strong and vigorous. If he desires, I will read his remarks.

On 11th March the Prime Minister was asked by the hon. Member for Paddington, North (Mr. Chiozza Money): Whether his attention has been directed to the fact that brewers and distillers pay merely nominal licence duties, £1 and £10 respectively, irrespective of the size of their businesses or profits; and if he can see his way to introduce graduated duties, which shall have regard to the scale upon which brewing or distilling is carried on by the various licensees. The PRIME MINISTER replied as follows: The principle of graduated ad valorem duties is not applied (nor is it, in my opinion, applicable) to licences which confer no monopoly privilege, but which are issued principally for registration purposes. The Prime Minister has told us that the Cabinet speaks with one voice and is one and indivisible, but do they act in this matter unanimously. We all admire the strength and vigour with which the Prime Minister speaks, but we have failed to appreciate the somewhat flabby manner of his action. In the case of the distillers the actual duty is raised something like ten times, or from £1,900 to £19,000, and in the case of the brewers the tax is raised from £4,800 to a hundred times that amount—£430,000. I think it will be admitted that, apart from any other tax, that forms a very heavy burden. If we take the best case of distillers the tax amounts to an extra Income Tax of one shilling in the pound on the dividend paid on the ordinary shares, and in another case it amounts to no less than 6s. 8d. in the pound upon the ordinary shares. If you apply that to individual cases it is an extraordinary burden to bear, and if there was no other in the Budget it is more than the trade can bear.

I think I am entitled to make some comparison as regards the taxation in other countries in this direction. The Chancellor of the Exchequer has often quoted Germany as a case in point. In Germany the actual tax upon beer varies from 4s. to 6s. 5d. per barrel, but that includes duty and the import tax on barley. The spirit tax is 2s. 4d., and there is no tax on wine at all, the licences are free, and the trade is tied. The only exception to that is Alsace-Lorraine, where there is a small tax on licences. If you go to America, which has been quoted by hon. Members on the other side of the House on account of their higher taxation in relation to licences, those higher taxes are shared with a lower tax upon the articles sold in the houses, and if we take the total taxation we find that it is lower than in England. Also in America the number of licences is very few in certain districts, and, therefore, as the retail prices are very much higher, the profits are greater in the houses there, and the burden of taxation is more easily borne. The progressive system is really a tax on goodwill. Last night the Chancellor of the Exchequer referred to cases of men who were paying £60 where they should be paying £20, and of men who were paying £20 where they should be paying £60. If he were here I should like to correct him on that point, because it is a very dangerous point upon which to argue. Take the case of two houses of equal value in the same street, which were exchanged by two breweries for reasons into which I need not enter. One was doing two barrels and the other 10 barrels a week. But when the houses were exchanged the man who was previously doing 10 barrels a week continued to do 10 barrels, and the other did two. I should like to ask the Chancellor of the Exchequer how he would assess those two houses before and after that transaction? Why should he tax the goodwill, whether it is in connection with the article sold, the popularity of the individual in the house, or whatever it may be? The burden of the taxation is indeed too great. It is so stupendous that it will be impossible for many if not most of the breweries to continue to conduct their business with success. I would point out that the capital in an industry is dependent on the income produced by the business. Therefore if you diminish by taxation the amount of income you also diminish to an enormous extent the amount of capital in the industry. It really comes to this: the total taxation of the trade under this Budget is so great as to become ludicrous, and I doubt very much, even if the proposals are passed into law, whether in the end the Chancellor of the Exchequer will receive a penny extra from them. I beg to move.

The hon. Gentleman (Colonel Walker) has quoted in the course of his speech an answer which I appear to have given when I held the office, of Chancellor of the Exchequer, in which I pointed out, I think quite truly, that a duty upon manufacturers such as is now proposed stands in an entirely different category from a tax on the monopoly privilege of the ordinary retail publican. The justification of the two taxes depends very slightly, if at all, on the same line of argument. Primarily the justification for this tax is that we are in search of revenue, and we believe that by the imposition of these very moderate duties on the manufacturers of spirits and beer we can, without substantial injury to anybody, raise what the hon. Gentleman has admitted to be a considerable sum. Taxes of this kind are always spoken of as though they were taxes on the trade. One might imagine from the line of argument generally pursued by those who take the same view as the hon. Member opposite that all taxes on beer, spirits, and licences were paid by the unfortunate manufacturers of or dealers in the commodity. There is no class in the country which has acquired by long practice a more accomplished habit of shifting the burdens of taxation from their shoulders than the class which the hon. Gentleman for the time being so ably represents. He has alleged that we are imposing here a novel and very oppressive burden, which I gather he rather implied could not be shifted, upon those who are engaged in the manufacture of these commodities. In regard to the distillers of spirits, whose case he has hardly touched, the matter is a very small one. I think the present duty is a fixed duty of ten guineas, and the Committee will see from the scale in the Schedule that a higher duty than 10 guineas is not imposed until after 50,000 gallons have been distilled. So that the total extent of the burden imposed, 30 far as spirit distillers' licences are concerned, cannot exceed one-tenth of a penny per gallon, which I think is a very moderate imposition.

The real brunt of the hon. Gentleman's argument was directed, I imagine, to the licence duty upon brewers, which I think he estimated would produce something like £430,000. I will not pin myself to a precise figure, but I do not think it works out at quite so much as that. In regard to this, which is much the most important part of the proposals, we are merely reviving the condition of things which prevailed prior to the year 1880. Before Mr. Gladstone introduced his Bill, which is now the Act of 1880, there was a licence duty upon brewers, graduated according to the amount of their production, upon substantially similar lines to those now proposed. Mr. Gladstone got rid of that duty in 1880 upon the ground that by his new taaxtion upon beer, the re-arrangement of the duties, the abolition of the malt duty, and other incidental changes in the law, he was providing an equivalent. But the question is, looking back on the state of things which prevailed then and the state of things which prevails now, whether there is or is not a justification for a revival of the old duty. What is the present state of things? Since 1880, when that change was made in the law, as the hon. Gentleman knows well, the number of brewers for sale in this country has enormously decreased. I think I am right in saying that whereas at that time there were something like 25,000, there are now not more than 5,000 brewers for sale. That diminution in numbers represents not a declining trade, but a consolidation of businesses, an increase of economies, and a profitable development of the whole machinery of production, such as could not possibly have been foreseen in 1880. That is one very important change, and a change entirely in the interests of the brewers, which has taken place since that date. Another noteworthy change, and one equally relevant to the proposal now before the Committee, is the substantial diminution—I will not attempt to estimate the precise figure, because there has been a change in processes—which everybody engaged in the trade will admit, in the cost of the principal raw materials which enter into the manufacture of this commodity. Of that there could be no doubt whatsoever. Further—and this is particularly relevant to the hon. Gentleman's suggestion that what we are really doing is imposing an additional duty of 3d. a gallon upon beer—it must be remembered that last year, in my Budget, I repealed half the Sugar Duty. A pamphlet issued by the Allied Brewery Traders' Association, estimating the additional burdens thrown upon them by Sir Michael Hicks Beach's Sugar Duty, says: "There is a duty collected indirectly by means of the tax on sugar of 2½d. a barrel." That was their estimate. If that is so, when I diminished the Sugar Duty last year by half, I reduced by l¼d. per barrel the cost of the production of beer. You must, therefore, set off the l¼d. against the 2.8d. of the hon. Gentleman.

I do not know how the hon. Gentleman conducts his trade, but a very considerable number of brewers do use sugar, and I am speaking only of them in this connection. As regards those brewers in whose manufacture the ingredient of sugar is habitually a raw material, the extra charge imposed by this new tax will not be more than 1½d. per barrel. Therefore, if you take all these changes together—the changes in the condition of the trade, the consolidation of the industry, the diminution of the cost of raw materials, and, as regards sugar-using brewers, the reduction of the tax upon, sugar, and, therefore, the reduction of the cost per barrel—the additional burden which this proposal casts upon them is really a very slight one indeed. Under these conditions the Government have thought it right to revert to the old state of things, which prevailed before 1880, when, just as now, the distillers and brewers had to pay a manufacturer's licence, in the case of the brewers based upon the scale of production. Therefore, there is nothing novel in the principle. The actual burden which it imposes upon the trade is very slight, but the additional revenue which it will produce to the Exchequer is quite substantial, and in the conditions of a case we have thought it a proper and expedient tax to impose.

The defence which the Prime Minister has made is a very interesting one, and one which I think is worthy of a little consideration. He began by observing that my hon. Friend (Colonel Walker) treated this particular tax on manufacturers as if it were a burden on the trade, whereas, said the right hon. Gentleman, there is no trade which has so perfected the process by which a burden is passed on to the consumer. Perhaps the Prime Minister will explain how, if he were a distiller, he would set about passing on to the consumer a burden which he explains amounts to one-tenth of a penny per gallon, without incurring the censure of his own supporters for taking from the consumer more than he pays over to the Revenue. It is all very well for the Prime Minister to come to the House and say "It is idle for the manufacturers and brewers and distillers to complain; they can get the money from the consumers"; but it is worse than idle for him to make that statement here, whilst he is, or at any rate his colleagues and supporters are, denouncing the brewers and distillers outside for endeavouring to get back from the consumer that which the Government have taken from them. [The PRIME MINISTER made a remark which was inaudible in the Gallery.] The Prime Minister contends that they get back a great deal more. The brewers dispute the allegation, but will he kindly explain by what process the brewers and distillers are to get from the consumer exactly the amount of the additional charges which he is placing upon them? The language of the Prime Minister and his colleagues in this House is wholly inconsistent with the platform tirades in which they indulge outside. But now turning to the taxes themselves, the Prime Minister justifies them—it is quite refreshing in this Budget to find such a justification—solely on the ground that he is in need of revenue. When I say solely on that ground, of course he goes on to argue that being in need of revenue it is equitable and proper that we should raise it. But he puts these proposals forward essentially as fiscal proposals, without any ulterior motive whatever. That is something to be grateful for. But is the Government wise to select this trade at this time for increased burdens? Are they wise from the fiscal point of view? They are selecting a trade which is notoriously depressed. It will not be disputed by anyone that for one reason or another both the distillers and the brewers have been doing badly in recent years, and though there may be accessory reasons, the main and most substantial reason is that coincident with the increase in their burdens, both Imperial and local, there is going on a great falling off in their trade owing to a change in the habits of the people. And it is at this time, when they are finding it difficult to conduct their businesses properly, and when the consumption of dutiable articles is steadily falling, not in one or a couple of years only, but over a series of years, that the Government choose to make an enormous addition to their burdens. If there be any wisdom in the canons of finance propounded by all the predecessors of the Chancellor of the Exchequer that is the wrong time to select for the imposition of further burdens on a particular trade, or a particular consumable article. But look a little more into the details of the reasons given by the Prime Minister. He says he is only reverting to the position of affairs before Mr. Gladstone's Budget of 1880. Mr. Gladstone produced that Budget as an improvement of a pre-existing system. The right hon. Gentleman is only half reverting to the old system. He does not go back to it altogether. He uses it as a justification for putting on additional burdens. He does not propose to convert the existing burdens into their equivalents in that pre-existing system. How does he justify putting on these additional burdens? He says since that time the number of brewers has enormously decreased. There have been great combinations in the trade. That is true not merely in regard to the brewing and distilling industry, but in regard to a great number of industries. Owing to the progress of competition, and the circumstances in which businesses to-day have to be carried on, large amalgamations are bound to be more successful in many trades than the smaller private concerns which used to carry them on. For my part, I regret that. I do not criticise it, because I know it is a necessity of business. If our business people are to hold their own, to maintain their position in this country, they are forced to adopt these methods. I think it is a misfortune. But it is not confined to these particular trades. It is equally applicable to the two products which the Prime Minister said he was going to discuss later, but which he did not discuss. I refer to chemicals and soap. There are great combinations in the chemical and soap trades, and I suppose that great economies are effected by these combinations. The right hon. Gentleman does not on that account propose to put a tax on the manufacture of soap or chemicals. Because the brewers have combined, and by combination have produced more economically, therefore he says he is entitled to place a higher tax on them, and that it is reasonable. That is the Prime Minister who has boasted on more than one occasion that this Budget, at any rate, does nothing to penalise enterprise and industry. Why, Sir, it is a direct fine on enterprise and industry, and it is applied to one particular industry only, and justified on the ground that that industry has done its best by enterprise, combination, and economy to meet the difficult circumstances in which it is placed, so as to enable it to carry on its business successfully. It is a direct tax not merely on trade, but it is a direct tax on manufacture, and it is justified by the Prime Minister on the ground that the manufacturers have exercised these qualities.

The hon. Member interrupts me. But if he considers he will see that it is a proposed tax on brewers and distillers, which is the very matter now under discussion. If the hon. Gentleman will refer to the Schedule he will find the Government proposals set out in the scale of taxes on brewing, on distilling, and on the manufacture of spirits and beer respectively. The Amendment which is moved by my hon. Friend, and which I was endeavouring to discuss, is an Amendment to omit the word "manufacture," so that we shall have duties—if you like, upon excisable liquor—but we shall not have further duties on the manufacturer. I hope the hon. Member is satisfied with the explanation. It would save the time of all of us if he would be good enough to read the Bill before he' comes down to the House.

What is the next justification the Prime Minister puts forward? He says the trade has been fortunate in getting its raw material more cheaply than it did. I have no doubt that is true. Pretty full advantage of that fact has been taken in the additional burdens which had already been imposed upon the brewer, and imposed and borne by the brewer without raising the price to the consumer. It is because partly by economies, and partly by the greater cheapness of the material, that be could manage to carry on his business at a reasonable profit without raising the prices. The third ground selected as a special reason for imposing this tax is that the right hon. Gentleman himself last year repealed one-half of the Sugar Duties, and, therefore, gave relief to the brewer. My hon. Friend behind me pointed out at once that that was very unequal relief: that the burden which the Prime Minister is now imposing in no way corresponds with the relief which he then gave. Some brewers may have found considerable relief in the cheaper sugar; others will have found very little. But the new burdens ire not created according to that. Therefore, there is very little relation in justice or equity between repealing the Sugar Duty and imposing the new burden. Why did the right hon. Gentleman single out the Sugar Duty for repeal? The whole of his dealings with the Sugar Duty were interesting, curious, and contradictory. The year before he was confident that unless you abolished the whole of the Sugar Duty the consumer would get no advantage. When he wanted to give away the Sugar Duty there happened to be an election at Dundee, and I suppose, in the perspective of Dundee, it became apparent that the relief would reach the consumer.

Yes, Sir; it is suggested that it was electoral reasons that induced the Prime Minister to make an absolute change of front on the Sugar Duties at short notice.

Let me say a couple of sentences more. I must make my meaning, or ground of my charge, clear to the Prime Minister. In the previous year he had refused to give this relief because he said it would not reach the consumer. In the previous year he had further stated that he could not both give away taxation and carry out the great social reforms which he contemplated, and that if the Government were to have an Old Age Pensions scheme he must keep a nest-egg in order to provide the funds. Next year came. The Government had that scheme. It had just come into force. They estimated—very rashly and recklessly—that it was going to cost them £6,000,000. It has cost them about £9,000,000. Did he keep any nest-egg for that? No! That was the moment he chose to give away money which he thought it necessary to keep the year before, and to turn his back on his own declaration that it was useless to give away that duty because it would never reach the consumer. If it was a mere coincidence that the Government had been suffering electoral reverses, and still had electoral contests in front of them at that moment, it was a very singular one. For myself, bad as I think an electoral excuse as a justification for such dealing with the national finances, I can find no other whatever in the circumstances of the time for the action which the right hon. Gentleman took. When he made that reduction he stated that the Sugar Tax was peculiarly hateful, because it was a tax upon industry; because sugar was not only an article of common consumption by all classes equally, but because it entered into the processes of manufacture. It was, he said, peculiarly inexpedient to tax a commodity which entered into the processes of manufacture. So much for last year. He comes down this year, and says, "Because I took half the tax off the raw material, or one of the raw materials of brewing, that is a reason for placing a new tax in its place upon that process of manufacture."

I do not wish to misrepresent what the right hon. Gentleman said, but he gave three reasons.

What I said —and this is the only relevance to the sugar—the hon. Gentleman opposite represents, and unfairly represents it—was, " Primâ facie this was a tax of something like 3d. per barrel, and in estimating the amount of the new burdens you must take into account that they received relief to the extent of a 1¼d. last year." Is that true or not?

Does the right hon. Gentleman mean that as a reason for the imposition of this tax? If he did not offer that as a reason for the imposition of the tax it was wholly irrelevant, and whether he means it as a reason for the imposition of the tax or not his conduct is wholly inconsistent. He said last year it is very bad to tax a commodity used in any manufacture, and this year he proceeds to tax, not the commodity but the process of manufacture. Is it better to tax the process of manufacture or the commodity? I am bound to say that this throws a singular light upon this principle of Free Trade finance of which the present Government are supposed to be the special guardians. Customs duties are hateful, but duties upon the English process of manufacture may be regarded as necessary and even laudable. They complain of Customs duties at the ports as an interference with the trade and raising the price of the article, but they do not hesitate to put on a duty on the process of industries, upon the actual manufacturer of goods within this country. I think that is pretty inconsistent, and I think that the whole public opinion of this country will be of our opinion that if you are to have duties of this kind, those collected at the ports are much less harassing and much less injurious to British industries and to employment of this country than duties of the kind which the Government have chosen.

There is one other observation I must make. If there are to be those duties, why have the Government allowed no drawback in respect to such spirits of British make as are manufactured in this country. They allow a drawback in relation to the 3d. on beer, they have allowed no drawback in respect of spirits. The right hon. Gentleman says he will explain why, but I ask him to reconsider his determination. I do not know whether his explanation will be that the duty is such an inconsiderable one. He himself said it was one-tenth of a penny per gallon. That is very much my calculation also, but one-tenth of a penny per gallon is about 1 per cent. on the price of the manufactured article. If he takes one-tenth of a penny per gallon, and adds that to the price of the article, with the gigantic duties that exist and the still more gigantic duties which he is proposing to put upon it, then it is considerable, and for the purpose of the export and competitive trade abroad what you are to consider is not the price of the article which the duty is on but the. Price of the article free of duty in bond, and I think one-tenth of a penny will work out at nearly 1 per cent. Plenty of trades in this country under present circumstances and conditions cannot afford to have such a percentage as that put upon them, amounting to nearly an additional 1 per cent. I do not think, therefore, that there can be any justification for the neglect to counterbalance this duty on manufacture by a system of drawbacks, and I imagine the failure to do so is really due to inadvertence. The 3d. drawback on beer only appeared on the Paper in connection with the Customs Duty at the ports, and the Customs Duty upon beer never would have been put down but for my right hon. Friend the Leader of the Opposition, who asked that foreign manufacturers of beer should be charged the same as the home manufacturer. The moment they got the Custom Duty on imported beer the Government put down a corresponding drawback, but they seem never to think that the Manufacturers' Duties are, in fact, with the added aggravation that they are levied on a process of manufacture, Excise Duties, for which a countervailing drawback is equally necessary. I hope the right hon. Gentleman will not only explain, but now that his attention has been drawn to the matter he will see the countervailing drawbacks should be given.

I will not consume the time of the Committee by dwelling upon the attack which the right hon. Gentleman has made in connection with the repeal of the Sugar Duty. If he seriously believes, and if Gentlemen sitting behind him believe, that I or anybody else holding the responsible office of Chancellor of the Exchequer proposed such a measure as the repealing of more than half the Sugar Duties for the purpose of influencing a single bye-election they are perfectly welcome to entertain that belief, and I shall do nothing whatever to disturb it. As a matter of fact, I venture to say there is not a single man among them who does believe it. With reference to the practical question which the right hon. Gentleman has put to me with regard to the absence of countervailing Customs Duties and drawbacks in relation to spirits, the facts are very simple. I quite agree such a provision is made, and ought to be made, in regard to beer, and the Bill proposes to make it. As regards spirits, the total estimated increase of cost of duty, as I have said, is one-tenth of a penny per gallon. As a matter of fact, under the existing law that is a very small sum, but the existing sur-tax on foreign spirits is, admittedly, too high.

I myself have been reproached when I was Chancellor of the Exchequer with retaining protective duties in regard to domestic spirits for the reason that the surtax was really too high. Especially has that become the case since 1903, because in 1903, when the Corn Duty was abolished, the additional surtax of Id. which was imposed to counterbalance the Corn Duty was not discontinued, so that the additional surtax of Id. is still there. Although it is very difficult to reduce it to the precise mathematical equivalent, I am assured if you take the existing scale this additional one-tenth of a penny requires no countervailing duty.

The right hon. Gentleman was talking about the surtax. I am talking about the drawbacks. The two things are very different. He is talking about the additional surtax put upon the importation of foreign-made spirits in order to counterbalance the duties here. I was aware that there was a good deal to be said as to the exact equivalent. Personally, I do not agree about the exact equivalent. I would sooner the balance was weighted in our favour. I do not put that case forward for the right hon. Gentleman, because I do not expect much sympathy from him. I put forward quite a distinct case—the drawback on British made goods. You have these manufacturing duties on distillation of spirits; when that spirit is shipped as merchandise or as ships' stores, then you give it an equivalent drawback.

I am sorry I misunderstood the right hon. Gentleman. With regard to the drawback, he counts it as so significant that he puts it at 1 percent. I am informed it is not more than one-third, at any rate, that it is so small it would be impossible to devise anything in the nature of an equivalent.

I do not rise for the purpose of discussing the spirit question, but I must say I cannot agree with the Prime Minister on the surtax. There is no man in politics more than the Prime Minister who brings a judicial mind to bear on these matters. He treats questions apart from politics as if he was a judicial personage deciding on the merits. Now, what are the facts with regard to spirits? You cannot put up a distillery in this country except by complying with the most rigid and difficult conditions enforced by the Excise. Take Germany. Why, Bismarck had a distillery on his own estate for making spirits out of potatoes, and Germans everywhere can put up without consulting anybody a still and at once proceed to make spirits, and, in the view of Mr. Gladstone, the threepence that was allowed was always because of the existing difficulties that were thrown by the Excise in England and in Ireland in the way, and it was more as compensation for that than anything else that it was made. I am not asking for countervailing duty as in the case of beer. I think it is right to remember what was at the root of the matter, namely, the fact that Mr. Gladstone's original policy was to make the brewer or distiller bear the whole, but he at last gave a concession as regards spirits. May I say as regards beer that the arguments which the right hon. Gentlemen gave us seemed to me to bring some measure of satisfaction from his point of view as regards England, but our country, which is caught in the English meshes of taxation as one of the curses of union, the conditions are absolutely different. I do not think there is an ounce of sugar used in the making of beer in Ireland. Speaking generally, I say that the sugar used in the manufacture of beer in Ireland is a very small amount, and therefore the answer which the right hon. Gentleman gives that a manufacturer of beer gets some compensation from the remission of the Sugar Duty does not obtain so far as Ireland is concerned. Not only is sugar not used, but while the distiller can use malt of a more or less inferior kind he can, at all events, buy a cheaper malt than the brewer. Of course, I am only speaking for Ireland, and I say the brewer can only afford to use malt of the very best quality. He is confined to that in Ireland, whether by the difference of the popular taste or not I cannot say, and therefore the answer of the right hon. Gentleman so far as we are concerned, does not affect the situation. His other answer seems to me to be a good answer. I was astonished at the courage with which it was put forward recently in a speech by the President of the Board of Trade. He said the brewer will get it off the public. I think it is perfectly legitimate for the brewer to get it off the public. If I was engaged in the manufacture of chairs and a tax was put upon chairs, I certainly would try and get it off the public. I am astonished in connection with these trade questions why everybody should be so mealy-mouthed about getting it off the public. You do not engage in trades for the purpose of using money.

5.0 P.M.

Is it true, speaking solely of the Irish position, to say that the brewer in Ireland will get the extra tax off the publican. I say it is not; and why? Because Guinness will not let him. What are the facts? I have two little breweries in my Constituency, and one of them has never paid a dividend. Under this proposal it must pay a dividend to the British public and to the Chancellor of the Exchequer which it has never yet paid to its own shareholders. The other brewery in my Constituency is a more or less struggling institution, which casually pays a dividend. If these brewery companies propose to get the tax off the publican what would Guinness do with his enormous reserve. He has refused to put a, single fraction upon beer, and the result is that that great company, with its enormous reserve, actually dominates the whole of the rest of Ireland, so that instead of cursing the Budget, there are two big breweries in Ireland who are most anxious that this Budget should pass; and why? Because they will be able to hold the whole of Ireland between them. What will be the effect of this on my Constituents? Louth is one of the few barley-growing counties in Ireland. Wherever you have agriculture you have a certain amount of labour employed, but the moment these small breweries disappear tillage will disappear, and when that disappears labour disappeais also, and the labourers will go off to America, and there perhaps they will join or help to swell the enemies of England in that country. That is the answer. Why should we be prevented from putting in a plea for the smaller brewer. It seems absurd, but it is not really that the big man is able to do what I have stated, but he is also able to command the railway rates. Guinness can take into his sidings whole trains and send them out and get special terms. Guinness can send to me a barrel of porter almost twice the distance than from Cork cheaper than the Cork man can send it. By this Budget you are helping the big man. This is a Guinness Budget, as far as Ireland is concerned, and it is a fact that the Guinness shares went up £l the day after the Budget was brought in. And this is a temperance Budget. What amount of consideration have these special circumstances in Ireland received? The answer is nil. This Government treats us as if we were a sort of Hinterland of Middlesex, and that is the way the case of Ireland is looked at. I do think that the case of the small industries ought to be more considered than it is. It is no answer to me to say that beer drinking is an evil. Why do not you tax all the other evils? Why not tax some of the virtues? We have a very flourishing ginger-beer institution in Ireland. Then again, there are a number of institutions of a foreign origin. There is Apollinaris. Why not put a farthing upon Apollinaris? Then there is another thing called Perrier water—why not put a farthing on that? Why not tax French wines, French claret, and French sherry? I read a magnificent speech yesterday which was made by the Minister for Education. I should not have read it only I was travelling in the train. He said, "Let every man remember in the future that when he is enjoying himself at the dinner table or the public-house he is adding to the resources of the Chancellor of the Exchequer." But that is not so. I can drink champagne at the same price as I always did, and I can drink claret at the same price. All the German wines are still sold at the same price, and I cannot understand the fetish, if it is Free Trade or whatever it is, which will put a tax on a-native manufacture because after all this is a tax on a particular manufacture. Some one said why not tax soap, and the reply was that it would attack the virtue of cleanliness. I believe William the Conqueror did not wash, but he nevertheless conquered England. Once you admit the principle of a tax on manufactures I cannot see why a particular article of manufacture as in this case should be selected simply because there are evils arising out of it. Budgets, as I understand them, are not brought in to aid virtue, but they are brought in to raise money, and their effect, therefore, upon the virtue of the population may be considered as a negligible quantity. I am not aware that these taxes do largely increase virtue, but no doubt there are a number of hon. Gentlemen opposite who think so. If their view is correct on this question why not tax altar wine? There are a number of Nonconformists who do not believe in certain devotions connected with the Church of England. What would you think of a proposal for increasing Nonconformity and its virtue by putting a tax on altar wine? That is always the defence put forward and yet you propose to advance temperance by putting a tax on these articles which the public use for their pleasure. If you do that, and insist upon doing it, I think you ought to do it in a reasonable way. What you are doing, as far as Ireland is concerned, is to increase an existing monopoly. You are also wiping out all over the country eight, or ten, or perhaps twenty smaller breweries, and at the same time you are wiping out tillage which goes to the creation of the barley industry and malt products. I think you really might have adjusted your taxes in some other way, but, I suppose, it is no use, after the attitude taken up by the Government, putting in a plea for the small man. He must go, and the rich man will be aggrandised. I notice from the Schedule it is provided that if the sum does not exceed £100, £l must be paid, and then for every £50, or a fraction of J2s, about 3d. a barrel. I want to know why the Government have selected this particular Schedule. Would it not have been well to consider first whether the Schedule is drawn in a really scientific way? Why not find out what it is that the small man generally makes, and give him a chance? Otherwise, in a very short time, all this trade will be given over to trusts. The right hon. Gentleman himself admitted that the brewing and dis- tilling trade had, since Mr. Gladstone's. Budget, enormously decreased as regards the number of the breweries in the country. Here you are taking a step by your system of taxation which is in the interest of trade and large concerns, and the Government say, "We care not; our only object is to get money, and to get it in the easiest possible way." We belong to a small country, and, I suppose, it is our fate to suffer; but I, nevertheless, think we are entitled to make a protest. In consequence of these proposals, in a very short time there will only be two breweries in Ireland—one in Cork and another in Dublin. What will be the effect of that upon agriculture? Why, that nobody can sell barley except at the price fixed by these two great rings, which, of course, would agree as to the price to be fixed, and the farmer will be squeezed out. These two great trusts, who will be buying the barley, will make the price, and the farmer will suffer accordingly. As this Bill; is largely supported by persons who only take temperance drinks, and do not take the more humane view of this question, we in Ireland are to get no satisfaction. If the small man is to have a chance, we should begin by a system under which a man will be allowed to make a few thousands free. That would give us some relief, and, on behalf of the small man, I respectfully put in that plea.

I looked forward with considerable interest to the reply of the Prime Minister upon this particular Amendment, because I think he is absolutely tied by the declaration he made in 1907, and I do not think he can run away from that. The right hon. Gentleman agreed that there was no excuse for imposing taxation on manufacturing businesses to which no monopoly has been granted, and therefore the suggestion made by the hon. Member for Paddington was quite inadmissible. He comes down to the House to-day, repeats that belief, and proceeds to justify the imposition of these taxes on grounds which I do not think would bear examination. The principle of his justification was, I think, that he needed money. If he needs money he had better bring all manufactures within the scope of his taxes, and not select one or two. I believe the most important justification which exists in his mind is that there was a Brewers' Licence Tax up to 1880, and that he is, therefore, only restoring a principle which was then in existence, and had been existing for a long-time. The right hon. Gentlemen entirely forgot to tell the House—perhaps he did not know—that that Brewers' Licence Duty was a substitutional duty for a hop duty repealed some years before. On the assumption that a certain quantity of hops was invariably used with a quantity of malt, the tax was substituted for a hop duty of so much per hundredweight and for the shilling duty per quarter on malt. The brewers opposed that Licence Tax, because they had no business to be taxed for carrying on a trade which was in no sense a monopoly. That tax was a totally different tax. The Treasury at the time could not afford to give up the hop duty, but they thought that, in the interests of the hop brewers, it ought to be removed, and they deliberately placed a tax on the brewers in substitution. The brewers, however, had been paying the tax all along as part of the cost of the hops they used. That is the answer to that. The right hon. Gentleman admitted that when Mr. Gladstone changed this from a malt to a beer duty he deliberately included that Licence Tax of 1s. per quarter in the new duty. Indeed, he did more. The two taxes on malt combined amounted to rather less than the sum of 6s. 3d. per barrel on a gravity of 1.057 degrees, at which he fixed the duty. It now stands at "7s. 9d. on a gravity of 1.055 degrees, which would be about 8s. at the standard gravity of the original impost. The result is that brewers pay 1s. 9d. per barrel, or 7s. per quarter more than they paid when Mr. Gladstone imposed that tax.

Then the right hon. Gentleman' went on to say that there has been a great decrease in the cost of material. You are taking that from us in your taxation, and it does not count. You are taking more from the brewers by your new taxation, and the material also has gone up. Barley has gone up 7s. per quarter in the last two years. Does the Prime Minister know that? He is taking 7s. per quarter in taxation when the market is taking 7s. per quarter more than it did two years ago. Indeed, I think, it is rather more. Barley such as that from the Mediterranean, bought at 18s. or 19s. per quarter, now costs 32s. or 33s. per quarter. All the time the price to the public has been gradually reduced until now, in Scotland, at all events, it is very considerably less than when Mr. Gladstone changed the duty; and the public or the barley grower has got the whole advantage, which the right hon. Gentleman claims justifies him in imposing the tax. Why should brewers and distillers be selected for this particular novel impost? At present, they collect nearly 38 millions of money for the Government. It is done easily and cheaply, and it is paid by them every month. The Government ought to show some gratitude to us for what we do. We not only do it, but we have got to take the risk for those for whom we pay it.

While these taxes are wholly inadmissible on manufactures of any kind, they are more inadmissible on brewers and distillers than on any one else. If the right hon. Gentleman wants any more money, let him not get it from those who are at present penalised by so much taxation. I agree he is not imposing such a large tax upon the distiller as he is proposing to impose upon the brewer, but he is going to put a tax on his article which is going to crush the distiller in Scotland, and it is being looked upon in that country with the greatest possible concern. I was called upon by the Provost of one of the Burghs I represent to attend a public but non-political meeting he convened in Campbeltown last week. There was only one man out of an audience of 1,500 who held up his hand against a resolution protesting against the extravagant and monstrous duty suggested to be placed upon spirits owing to the effect it would have upon that town and the industries on which it depended. The Government is not content with taking something from the unfortunate people they are going to ruin by this taxation. I am thankful to think they are also going to ruin the Treasury. It serves them jolly well right. The Government have entirely forgotten the maxims of Mr. Gladstone on the question of taxation. He was not so foolish as to tax a declining trade. The present Government not only tax a declining trade, but they tax it to such an extent that the immediate effect is that they get far less out of a big tax than out of a small tax. Still they go on rejoicing, and they think they are doing well for themselves and the country. I earnestly hope the Treasury will suffer considerably from this absurd impost. I am glad to take this, the earliest opportunity, of stating what these unfortunate people think. That particular town depends wholly upon the fishing and distilling industries. The Member for Argyll (Mr. J. S. Ainsworth) will bear me out. I am sure he feels as I do, whether he agrees with the tax or not, that if it has a serious effect on the distilleries there, it will have a disastrous effect upon the prosperity and employment in that town. The Prime Minister stands to his opinion that it is inadmissible to tax a manufacturing industry on the principles which this Schedule proposes unless there is a monopoly granted along with the licence. He says he needs the money, and he cannot justify the tax except on other grounds, of which I have taken notice. I think I have disposed of a good many of those grounds. They are not really arguable grounds. While the right hon. Gentleman has been extremely lucid in stating one side of the case, he has taken uncommonly good care not to state the other. I do not know whether he knew it, but I have now told him, and I hope he will change his mind and advise the Chancellor of the Exchequer not to proceed with this absurd tax.

I would like to say one or two words in connection with one point raised by the hon. Member for Ayr Burghs. He sought to dispose of one of the justifications the Prime Minister had given for these duties by suggesting that similar duties which existed prior to 1880 were substituted for a hop duty previously repealed. I think he will admit his historical researches were not complete. He must be aware that prior to 1830, when there was a beer duty, there were similar high licence brewers' duties precisely on the same principles as this, and there was also a hop duty in existence. Whatever may be said for their intrinsic merits, the essential principle or these duties represents a mere reversion to former taxation and to a principle of taxation which has very ancient and historical authority.

The hon. Member is going back to the days of the old Beer Duty, which has nothing to do with the question I am arguing. There was a Beer Duty in the time of the Crimean War. The Chancellor of the Exchequer then raised it very largely and killed the revenue.

I am dealing with the historical precedent. I am referring to the time when the total taxes on beer were nearly double what they are at the present time. I am referring to the time when you had an extremely heavy Beer Duty of 10s., in addition to these high taxes on brewers and other taxes on malt and hops.

The Prime Minister gave another partial justification for these duties. I think he was justified in reminding the Committee of the remission of half the Sugar Duty. Hon. Members opposite have contested that by pointing out that there are brewers who do not use sugar to any appreciable extent in the processes of manufacture. That is unquestionably true, but it is nevertheless the fact, taking the whole brewing production in this country, that whereas in 1880 sugar represented 8 per cent, of the material used in brewing, last year it represented 16½ per cent., so that the proportion of sugar now constitutes more than double the proportion of the total materials used in 1880. There were last year in the United Kingdom 114 brewers engaged in the industry whose total output represents one-fifth of the entire production of beer in the country, and whose percentage of sugar of their total raw materials ranged from 19 per cent, to 20 per cent. The Prime Minister, I think, was equally justified in reminding the Committee of the very substantial fall in prices of the raw materials of this industry since 1880. The average price of malt and barley in the quinquennial period 1882 to 1886 was 35s. 0½d. per 448 1bs. The cost of the same brewing barley in the five years 1902–6 was only 28s. 6½d. per 448 1bs., representing a decline in the average price of that most important commodity in the manufacture of this product of no less than 18½ per cent. Even if I include the temporary increase in price to which the hon. Member has alluded, the average price of malt and barley still remains substantially lower than it was in 1880.

I must leave it to the hon. Member to argue that matter with representatives of his own trade.

It is Mr. Alders, a well-known London brewer, who quoted the prices in his evidence before the Committee on Hops.

I have taken the official figures up to the year 1906, and from that point I have taken the market prices. I have already told the hon. Member that if I add to those figures the temporary increase since then to which he has alluded there is still a substantial difference in favour of the present price of barley. I may be allowed, I hope, to take a somewhat independent view in my attempt to justify these particular duties, which are, after all, only in amount the exact equivalent for the loss of revenue on the Beer Duty which has arisen from the reduction in the average gravity of beer since 1900. This reduction in gravity was the direct response of the brewers to the War Tax imposed by Sir Michael Hicks Beach in 1900, and represents a very considerable loss of revenue, for which loss these duties are only an equivalent. There is another consideration I should like to call the attention of the Committee to, and that is, although it is perfectly true Mr. Gladstone in 1880, in fixing the Brewers' Licence Duty at a uniform sum of £1, desired to institute merely a Registration Duty, he had in view simply the brewers' privilege as manufacturers. It is well known to hon. Members that, in the interval since 1880, there has been an extraordinary extension and development of a new branch of the trade, especially on the part of London brewers, in the direction of selling direct to consumers in their own homes. That represents an extremely important new development in their industry—a development which Mr. Gladstone could not possibly have foreseen. It represents a branch of industry on the part of the brewers outside their strict prerogatives as manufacturers, and it competes in a very substantial way with the wholesale dealer in the same line of business, who have to take out licences and pay licence duties. My own view is that, if the brewers are to be allowed thus to add a branch to their trade outside their strict prerogative, they should be at least subjected to taxation for that extra branch. The brewers in recent years have met growing and increased restrictions by establishing this new branch of business, and, therefore, this particular tax on barrelage, while it may not be the best form in which to meet this difficulty—I do not say that the duty in the present form is ideal—it certainly does tend in the direction of reaching these new developments on the part of the brewer. I agree that the most equitable way would be to base the taxation on a scale graduated to the amount of trade done in this particular way, but if the Government tell me that that is not practicable this year I am not going personally to consent to allow this important branch of the trade to continue to go untaxed when I have an opportunity of taxing it in the particular form presented by the Government.

The hon. Member who has just spoken generally makes well-informed speeches on this subject, but on the present occasion his arguments, if I may say so, appear to have got a little out of hand. He was dealing, for instance, with the incidence of the old Beer Duties, and he stated, quite accurately, that at some period, about 1870, they amounted to almost as much as the duty now proposed to be imposed. My hon. Friend the Member for Ayr Burghs tells me it is not so. The hon. Gentleman opposite is a great authority on the history of alcohol in this country, but he must be equally well aware of the unfortunate fiscal experience of maintaining the duties on beer at that scale—an experience not forgotten by succeeding Chancellors of the Exchequer, or by the present occupants of the Front Government Bench. There was such a shrinkage in the consumption of beer that it became very alarming from a fiscal point of view, and since then the Beer Duty has always been the subject of very careful financial calculations. That appears to me to be an extraordinary justification for the proposal now engaging the attention of the Committee. The hon. Gentleman added, with reference to the argument used by my hon. Friend, that Mr. Gladstone himself in 1880 had made use of the taxation on manufacturers, but he ignored one very important consideration indeed, and that was that in the period prior to 1880 this tax was strongly denounced by the brewers on the ground that unless they had a monopoly it was wrong that their industry alone should be exposed to the burden of the manufacturer's duty. I am almost sure I am right in saying that a deputation waited upon Mr. Gladstone and urged that point of view. It was certainly one which had always been put forward by the brewer, and at the present time, on the first occasion since 1880, we are faced with a proposal that the tax should be revived. The circumstances in which that proposal comes before the Committee are these. Only two years ago the present Prime Minister, who was then Chancellor of the Exchequer, was asked, point blank, and without the slightest ambiguity, whether or not he would impose this very tax which he is now putting forward in this Budget. The Prime Minister has attempted a single singular justification for his change of views. He says that what he meant was that the justification for a tax upon manufacturers does riot depend on the same line of argument as that for a tax upon a commodity. But nobody asked the Chancellor of the Exchequer for such a platitude. That was not the question which the Prime Minister was asked to answer. In order that there may be no mistake at all let us see how clear the point is. The present Prime Minister, as Chancellor of the Exchequer, said the "principle of graduated ad valorem duties does not apply, nor, in my opinion, is it applicable to licences which confer no monopoly privilege." Perhaps I may ask the Chancellor of the Exchequer, does he or not agree with this statement made by his predecessor? I hope that later on the right hon. Gentleman will answer that question. There is another qualification to be borne in mind. The Committee approaches the consideration of the Amendment moved by my hon. Friend with this admitted fact that, in the view of the present Prime Minister there is no justification for this to be applied to the manufacturers.

The question presents itself not only in relation to the manufacturers of alcohol, but also in connection with other manufactures. He says that nobody knows better than the great brewer how to shift the burden of taxation and to make the public pay. If that is so it is very important to understand whether the Chancellor of the Exchequer and the Prime Minister are recommending to those on whom they are imposing these novel manufacturers' taxes that they should divert the incidence to the consumer. What is the view of the Government on that point? It is quite clear the Members do not all hold the same view. The Prime Minister has told us that the business of the manufacturer, if he does not like a tax, is to divert it to the public. What does the President of the Board of Trade say on that point in the country? He says that if we do what the Prime Minister tells us to do we are swindling the public, and such is his respect for the law of libel, such is his anxiety not to pay the ordinary penalty which those who defame their neighbours become liable to, that he adds, "I will not mention the names of those who are swindling the public." I think the suggestion which has been put forward deserves less perfunctory treatment than it has yet received in this Debate. The question has been asked, what attempt has been made to justify the proposal to impose this heavy manufacturer's duty on spirits and beer in comparison with other manufactures upon which they might equally be imposed? No attempt has been made by the Prime Minister to answer that question. I will venture to reinforce the arguments by one or two additional observations. The Prime Minister has told us that the only justification for the tax which has been imposed on distillers and brewers is that he wants the money. Of course, that argument may be answered by pointing out that the right hon. Gentleman can equally well obtain the money if he taxes other manufactures. Therefore his argument is not worth the time spent in uttering it or the paper upon which it may be written. The question, of course, is why have you selected the beer and the distilling industries out of all other industries which might have been selected in order to get the money which is required? That is a problem to which no answer has been attempted. Let me attempt co put forward one. Let me test the propriety and reasonableness of the present proposal. I should have liked to have heard what the Prime Minister would have said if the proposal here had been to place a tax, not upon brewers, but on confectioners. The Committee will not fail to observe that the Prime Minister justified the imposition of this tax on brewers by saying that he took off the Sugar Duty last year, but whatever benefit the brewers might have derived from that, it certainly was not confined to their trade; and I think it will not be denied that the benefit was enjoyed to a much larger extent by other manufacturers. Why should not the money be taken from them? I believe one of the supporters of the present Budget, the Member for a Carnarvon Constituency, is largely interested in the manufacture of sweet aerated waters, and it is quite obvious that he also benefited by the reduction of the Sugar Duty which is put forward by the Prime Minister as a justification for this duty on beer. It is quite clear that you might have a hundred illustrations, and you might say of every one of them that all the arguments which have been used in regard to this particular industry, in reference to this tax, apply to the case of the other. The Prime Minister said, "Think of the combinations which the brewers have been enabled to form in the last few years, with a view of decreasing the cost of manufacture." Take the case of soap—I will not deal with the combinations which the manufacturers of that article have formed except to say that the total combinations arrived at in the soap trade are not smaller than those in the brewing trade. Therefore, the whole of the argument which has been used with reference to the cost of production and the raw materials might be multiplied by taking almost every other manufacture in the country, and we can retort upon that argument by saying that if there is any reason for all these taxes on brewers and distillers, they also apply to all the other industries of the country.

Let me take one. Let me take a great industry, which is very comparable in character, and certainly very analogous, from the point of view of the present argument. Take that great industry, which is run concurrently with the production of the "Daily News," by those who finance that paper—the cocoa industry. That really affords a most admirable analogy from the point of view which we are now considering. Why should not the proprietors of the "Daily News," who are strong supporters of the Budget, pay this duty? They fall within the net of every argument used by the Chancellor of the Exchequer, and if the right hon. Gentleman is now going to justify the imposition of this additional duty, on distillers and brewers, he cannot do so by one argument which does not apply to the manufacture of cocoa. Is there one argument why you should tax one and not the other, except that in the alternative field of activity the "Daily News" has been for the last two months circulating falsehoods about meetings in regard to the Budget? I think I have said enough to show that, at least as far as the Debate has proceeded at present, no argument of principle has been put forward which has justified any duty upon any article, which is not a monopoly, which does not justify the imposition of a tax upon other articles which have not a monopoly.

I may, perhaps, make one observation upon the discussion which took place be- tween the Prime Minister and the late Chancellor of the Exchequer with reference to the circumstances under which the Sugar Duty was taken off at the time of the Dundee election. I really do not know why anybody who, as a rule, preserves his calmness so well as the Prime Minister does, should develop such extraordinary heat when the suggestion was made that the tax was taken off in view of the election. After all, we may have to say certain things in the country, but here we are all friends. Why should there be this humbug about it? Surely we all understand democracy sufficiently well, and, like the Roman Augurs, we sometimes smile at one another. I am sure, at any rate, the Chancellor of the Duchy will not see anything improper in making a promise which he would not otherwise have made in order to win a bye-election.

The question has been put from the other side of the House as to how it is possible that the trade should pass this taxation on to the shoulders of the consumer. I should like to remind the Committee that there certainly was until a short time ago, and there is in existence now, to a certain extent, a system called the "long pull"—I mean, that there was a system prevailing all over the country, or in a great part of it, of giving excessive measure. It obtained to a certain extent in my own Constituency, in the borough of Crewe.

As a question of Order, Sir. Does not that really come on the next Amendment? This is not the retailers', but the manufacturers' case.

That is so. The present Amendment deals with the manufacturers, and the next with the retailers.

I was pointing out that it seemed to me that the way for the manufacturers to place the burden upon the consumers would be by reducing by the smallest fraction the amount served out. What is the total tax? It works out at 2⅞d. per barrel, and that on a 36-gallon cask works out at 2–25ths of a penny per gallon The right hon. Gentleman (Mr. Austen Chamberlain) calculated, that it was about 1 per cent., but estimating the gallon at 1s., it works out rather more like 1 in 150 than 1 in 100 of the total price. It is an almost infinitesimal amount.

The observations which I made, and to which the hon. Member is alluding, had no reference to beer, but to spirits, and the figure of one-tenth of a penny was mentioned by the Prime Minister.

I was speaking of beer alone. I calculated that it would work out to something more like 1 in 150 than 1 in 100. In other words, the manufacturers would have to get 1–150th part back from the consumers, and it will be done by an infinitesimally less measure being served out—the difference being so small as not to be perceptible. Moreover, it is apparent that there is at present much more than that percentage wasted and spilt upon the floor, and with better management the whole of these manufacturers might be free from this taxation. I throw that suggestion out to the hon. Member.

The hon. Member who has just sat down made a, contribution to the practical solution of the question which hardly seems to me to be one that can be adopted with advantage by those particularly concerned. The problem with which he was dealing was this—how are the brewers to throw upon the public the tax which the Government are imposing upon them? He apparently agrees with the Prime Minister as to what they ought to do, and he differs from the President of the Board of Trade and from the Chancellor of the Exchequer as to what they ought not to do. At any rate, he thinks, like the Prime Minister, that this is what ought to be done, and what would be done.

The Prime Minister contemplates it as the result of his tax. As I understand the right hon. Gentleman, he thought the only obvious result of this tax would be that the public would pay, and not the brewer, and for that reason, and for that reason alone, we have no right whatever to treat it as a tax on the brewer. How does the hon. Gentleman, who has just sat down, propose to deal with it? He proposes to deal with it, as far as I can make out, by inducing every wholesale manufacturer of beer in the country to sell short measure in order to recoup himself from the publicans, who are themselves going to dispose of the beer by retail. I hardly think that even the severest critics of the brewing industry would regard that as a procedure which they are likely to adopt, even if it did not bring them into immediate collision with the criminal law.

There is no legal measure; there is nothing to compel the serving of any exact limit.

I do not know whether the hon. Gentleman has made his meaning clearer to the Committee, or recommended his policy more plausibly to the brewing industry, but I confess, as far as I am concerned, that I do not quite understand the precise relevancy of his interruption. Nor do I see how it is possible, any more than I did before his interruption, for the wholesale manufacturer of beer to throw the tax upon the consumers of the beer by inducing the retailer to stop the "long pull" in those districts of the country where, like the constituency of the hon. Gentleman, he has told us it prevails in a peculiar degree. How the wholesale man is to produce that particular economy in his own manufacture and thus throw the burden upon the people who now have the advantage of the "long pull," I do not know. May I suggest, if only in parentheses, that I understand that magistrates in other and less-happily situated districts than that which the hon. Gentleman represents, have set their faces against the "long pull" with such success that that method does not prevail except in a few favoured places. The hon. Gentleman himself, I am sure, is an active magistrate within the region of his own constituency, and I would suggest that this particular economy may perhaps be effected in the wholesale brewing trade on his own plan if he would set his face against the practice of the "long pull," which has the prevalence which he has just described among those who have returned him to this House.

6.0 P.M.

One of the difficulties, I think, we are all under in discussing this question of the brewing manufacturing industry, is that there really is some question as to what we want. I believe that if this particular brewing industry were regarded as an industry amongst other industries, to be treated like other industries, whether it be soap or cocoa manufacture, which have been referred to in the course of this Debate—I believe, if that were the case, there would not be a single dissentient voice upon the proposition that this tax was unjust in its incidence upon individuals and inequitable to the trade as a whole. I do not believe anybody would deny that it would do much to diminish employment and do much to discourage home industries. If that is universally admitted, as I believe it would be universally admitted, what is the real ground upon which this tax is put forward? I believe the real ground is that a great many Gentlemen want to discourage the manufacture of this article, and, if so, it is perfectly useless for my hon. Friends to urge the principles of sound finance, and to urge that to throw the tax upon the manufacturer is bad political economy and is bad from the national and industrial point of view. They want it to be bad; they want to squeeze out the industry; but then I think they ought to say so, or else they ought to show why, if this is to be treated as an industry among other industries, the laws which are universally to apply to the encouragement or discouragement of industry do not apply to this industry. Of course they apply to this industry, and the tax is wholly indefensible unless my proposition be true that its supporters wish to see an exceptional discouragement put upon the industry. What I complain of is that the Prime Minister gives us a series of arguments in regard to the brewing industry as if it was, in his opinion, a trade among other trades and a manufacture among other manufactures, whereas, in fact, those who are going to support him in the Lobby are not going to support him because this is the proper way to treat a manufacturing industry if you wish to encourage it or to give it fair and equitable treatment; but, because it is not equitable, because it is onerous, because they think it will discourage the manufacture, and when my hon. Friend (Mr. Younger) says the citizens of Campbeltown have unanimously, irrespective of party, assured him that the trade of their city is going to be destroyed and men thrown out of employment, all that is thrown away on the audience opposite. They want to destroy it. The more my hon. Friend proves that those who work in the Scotch distilleries will be thrown out of employment, and that those who have capital in those distilleries will be ruined, the more pleased hon. Gentlemen are. He is using the wrong argument to persuade them. My complaint is not that my hon. Friend uses a perfectly sound argument addressed to the people who do not accept his premises, but that the Prime Minister does accept his premises and talks as if he wished to treat the trade equitably, although the provisions in his Bill are absolutely indefensible upon that hypothesis. Really, what argument has the Prime Minister adduced to show that he is not treating this industry inequitably? His main argument was that the Sugar Duty had been diminished, his second argument was that the industry had been rendered more economical since 1880, and his third argument was that the cost of raw material had diminished. But he knows perfectly well how, since 1880, the taxation upon this manufacture has grown and the burden has grown faster in one direction than the causes which have alleviated or rendered more profitable, the industry have increased in the other direction, and there is no reason why this industry is specially singled out for a burden which no other industry is capable of bearing.

I want to ask one further question on this point of manufacture. As far as I can make out, it is quite impossible but that this duty on the manufacture of spirits will increase the cost of spirits for purposes of industry as well as for the purpose of consumption. Everyone who has followed industrial development of recent years is we aware that the use of spirits in manufactures is becoming more and more necessary, and the Germans, who do not trammel in any way this manufacture of spirits for industrial or any other purpose have an immense advantage, in that every man can put up on his own farm a still which will produce at an extraordinarily cheap rate spirit from the produce of his farm without destroying the produce for other purposes. That is a most important element in the modern rural agricultural economy of Germany. That is, of course, an advantage to the agriculturists which I. do not see how we can give to our agriculturists here, but it has a collateral advantage, which is to allow the spirits which have to be used in manufactures to be obtained as cheaply as possible. Do you not by this duty make spirits for manufacturing purposes a more costly article than at present? The Government must have considered the point, and I shall be glad to know what the result of that consideration is.

There is another question which is of even more importance from the financial point of view than from the manufacturing point of view. It was referred to by the hon. Member (Mr. Younger), and we have had no answer to it. The hon. Member holds the view that this tax is thrown upon an industry which is not merely a waning industry but that our existing taxation has reached such a point that new taxation will not increase revenue, but will only depress the industry. I wonder whether that is borne out by the figures in the possession of the Government with regard to the consumption of alcoholic liquor since these taxes were brought in. I imagine there may be some difficulty in making a perfectly authentic calculation on the point owing to the difficulties and complications and calculations which arise from spirits having been hurried in before the Bill was brought forward. But I think a sufficient length of time has now elapsed since the Budget was introduced for the Government to be able to make some calculation as to the effect upon consumption which their new taxation involves. If my hon. Friend was right the taxation has already reached a point which shows that this is not an elastic source of revenue, and the Government I think probably are in a position to tell us what is the new calculation based upon experience. If they cannot give us a full account of the Treasury views upon the subject, at all events they may give us some indication of how they think consumption is affected by the duties which they are already levying. There is one other point which arises out of the Chancellor's speech, on which I do not think quite enough has been said. One of the reasons which makes him think that the brewer is in a position to have an additional duty put upon his industry is that he reduced the Sugar Duty last year by a half. Part of my hon. Friend's charge was not, and I imagine cannot be, answered—the charge that the Prime Minister had laid it down as a fiscal axiom that you could not diminish the Sugar Duty by half, and relieve the consumer by that process. That was the plea of the Government two years ago; it was not their plea last year.

I beg pardon. I do not know whether the right hon. Gentleman read my Budget speech of last year. I went into the matter most fully. I reduced the Sugar Duty by more than a half for the very purpose, and with the effect of benefiting the consumer.

I understood the proposition laid down by the right hon. Gentleman in the year preceding the speech which he made was that you could not touch the Sugar Duty for two reasons. One was that you required a nest egg for old age pensions—a nest egg which he proceeded at once to addle—and the other was that you could not diminish the tax for the very reason I have stated, namely, that the consumer would not get the benefit of it. He discovered last year that he could reduce the tax. If he was right last year he was wrong the year before, and if he was wrong last year he was right the year before. I can leave the Chancellor of 1906–7 to deal with the Chancellor of 1908. That, however, has only an indirect relation to the real point. The real point is this: If it is a material advantage gained by the brewing trade as a whole that the Sugar Duty has been diminished—if it is an advantage so great that it counts as an important asset on the other side when you are calculating the burden of the duty, then evidently you are differentiating between two classes of brewers—those who use barley and those who use sugar. Is that the intention or is that a desirable object in the view of the Government? I understand that sugar is a substitute for barley, and by every additional pound of sugar used in brewing, by so much is the demand for barley as a raw material of beer diminished, and by so much is the agricultural interest of this country, which as far as cereals are concerned more and more depends on barley, injured. The avowed result of the Government policy in this matter is that they are deliberately differentiating against the form of brewing which, whether it be best or not for the drinker of beer, is certainly the best for the agriculturists in this country. By reason of this duty you are giving these brewers who use barley a special inducement to use sugar for barley. Is that what you want? It is no answer to me to say whenever the Sugar Duty has been diminished it has had this differentiating effect, and you have not grumbled at it before. While you cannot, of course, make your system of taxation ideally perfect, you can tolerate, and the community are perfectly ready to tolerate, anomalies when the taxes are small which become confiscatory or oppressive or unjust or deleterious when the taxes are made larger. The fact which they neglect on a small scale fills the eye and the imagination when they view it on a large scale. Therefore by the fact that you are piling on these duties on beer now the difference which always exists in favour of the brewer who uses sugar—a difference caused by the action of the Government in diminishing the Sugar Duty—is magnified, and you are now differen- tiating in favour of the sugar-using brewer as against the barley-using brewer. It is greater now, and it is likely to have a greater agricultural effect than when your taxation was on a more reasonable and a more moderate scale. I do not see any reply to that. I think those incidents in agriculture ought not to be ignored.

There is another point which I think is important, and it is the last which I shall bring before the attention of the Committee. The Government anticipate that the brewers will be able to throw the duty on the consumer. They know very well that any industry when it can throws the burden of taxation upon the consumer. They also know that there is no blame attaching to that process. But they speak of that sometimes with reproach, as they do of other matters. I wish to know from the point of view of the ethics of the question: Is it moral or immoral for the trade you now propose to tax to make the consumer pay the tax 1 And if they make the consumer pay the tax, how are they going to make him pay the tax and no more than the tax? That has never been explained to us. I remember the Chancellor of the Exchequer, in an earlier Debate, said he was endowing the brewers with £20,000,000. I understand he meant that the smallest additional price which could be put upon a glass of beer, or whatever the unit of consumption may be, would not merely pay for the tax, but more than the tax, by £20,000,000. I think that statement of the Chancellor of the Exchequer was more applicable to some of the other fiscal arguments with which he has favoured us in the course of these Debates than to this case, but if that does represent the amount the consumer will have to pay owing to the smallest addition which can possibly be put on the glass of beer, how is the trade to put it on the public? That is a question which the Government must consider. It is possibly capable of some answer, but I do not know what the answer is. Are the brewers justified in the view of the Government in increasing the price of beer because the production of beer is made more costly by their taxation? We have had two quite different views on that question. We have had also two quite different views on another aspect of the question in relation to land, namely, what is a ground landlord justified in asking at the end of a lease? The Prime Minister thinks it is his business to exact a higher rent at the end of the lease, and he would do it in like circumstances. The Chancellor of the Exchequer thinks it is black- mail. The Prime Minister, again, on this other ethical question of business in connection with the manufacture of beer, thinks it the natural course that the brewers should, if they can, throw the additional taxation on those who may consume the article. I understand that is called swindling by the President of the Board of Trade. This difference of ethical view is really rather important. Are we to regard the Chancellor of the Exchequer and the President of the Board of Trade as people of such high and defined position morally that they can speak of these slight peccadilloes in the language which an ascetic might use in regard to the slightest lapses which ordinary people would not call peccadilloes at all, and which the coarser conscience of the Prime Minister treats as ordinary transactions which every man of business and every man of the world could, would, and ought without reproach to indulge in in the ordinary conduct of his affairs? I should like to know whether he thinks it is possible that the utterances of the Chancellor of the Exchequer and the President of the Board of Trade, representing these unapproachable heights of public morality, which would seem absurd and almost hypocritical in the case of ordinary men, become natural and excusable in the mouths of those political saints. In the meanwhile it must, I think, be acknowledged that the difference of statement is most marked in both cases.

I should not be in order in dwelling at length on the differences in other matters, but it is important to know what the view of the Government is in this matter. After all, the incidence of taxation is an important matter. The Government imposes taxation. Do they want this tax to, be borne by the manufacturers of beer and spirits, or do they want and contemplate as being natural that it should foe borne by the consumer? That is a very plain and simple question as to what they anticipate. If, as I understand from the Prime Minister, he thinks that the public are to bear it, will he explain how he reconciles that view with the statement of the Chancellor of the Exchequer that the public will pay it, and £20,000,000 more which will go to the brewers? I have often heard that one of the defects of any form of Customs tax is to throw a profit in the hands of the home manufacturer which does not go into the Treasury. But has anybody ever heard of a. Customs tax, however extravagant in amount, which throws so much into the hands of a single trade as £20,000,000, which I understand the Chancellor of the Exchequer says will be put into the hands of the brewing trade? Of course, it was rather late at night when the Chancellor of the Exchequer made that statement. It was made at an hour when the imagination gets stimulated. Then we are not depressed with theories, and we may indulge in less balanced statements at two or three in the morning than at five or six in the evening. What is the view of the Prime Minister on this subject? Does he contemplate that this additional duty will be thrown on the public, and, if it is thrown on the public, can he tell us how it will be thrown on them, and whether he thinks the amount which the public will pay will equal or exceed the amount laid on the shoulders of the brewers? That is quite a simple question, and it is one which I am sure the right hon. Gentleman must have considered. It goes to the root of this financial proposal, because every financial proposal depends largely for its defence upon the nature of the class, or portion of the community, upon whom the burden of the tax ultimately falls. If he thinks it is ultimately to fall on the public, will he let us know how it will fall on them, and if he thinks it will not fall on the public, let him admit that this is really crushing still further a failing industry, and throwing a burden upon those who are already, owing to our fiscal system and other causes, scarcely able to carry on at a reasonable profit a trade which, whatever may be thought even by extreme temperance reformers, seems to me to be a perfectly legitimate trade, one required by the real wants of the community as a whole, and one which, if it is an honourable trade to carry on under our laws, ought to have no worse treatment meted out to it than is meted out to other industries.

Earlier in the Debate I explained at considerable length, and as I thought with reasonable clearness, my own view, which must be taken as the view of the Government, in regard to most of the points which the right hon. Gentleman (Mr. Balfour) has raised in his speech. But in deference to his appeal I will endeavour to answer the two or three questions he has asked. First of all as regards the effect on the trade. It is, I think, too soon as yet to make any statement of an authoritative or even a trustworthy character as to what the effect of the new taxation is likely to be on the consumption of spirits, and therefore on the ultimate revenue of the year. As is always the case when new taxation is in the air, there is in the closing weeks of the expiring year in regard to the commodities on which it is anticipated the new burden is most likely to fall, a considerable amount of what is commonly called forestalment.. Our experience during the close of the last financial year in this respect, and in regard to these particular articles, was an almost abnormally unfavourable one. I should not like, therefore, at the end of August and the first days of September to make any definite answer—for which I do not know I have materials—to the question of the right hon. Gentleman. As regards the other matter raised, namely, the effect of this distiller's duty on industrial alcohol, it is quite true that the tax will fall upon distillers of spirits for whatever purpose those spirits may be desired. But in regard to industrial alcohol the right hon. Gentleman probably knows that in the course of the last few years we have practically completely freed it from duty, and the only effect of this new duty will be to put a burden to an extent, as I said in my remarks earlier, estimated at one-tenth of a penny per gallon on the commodities produced by spirit distillers. It is the opinion of those who have looked into the matter that it will be an infinitesimal burden in regard to them, and that it will-, not substantially, or at all, affect the users of alcohol for industrial purposes.

I pass to the questions of a more general kind, and dealing more with matters of principle, which the right hon. Gentleman put to me at the close of his speech. It was very flattering to discover the minute verbal interest which so acute and fastidious a critic of language as the right hon. Gentleman bestows on the utterances-of my colleagues and myself. It shows the advantage of the leisure of Opposition as compared with the cares of office that the right hon. Gentleman should have so much time at his disposal to enter into these elaborate literary distinctions between the different vehicles of speech represented by my colleagues and myself. I am particularly fortunate in having colleagues with a large command of language. I may add, it is one of the grounds on which I am entitled to claim for this Government, I will not say the confidence of the country, but some degree of distinction, that we have added enormously to the picturesque resources of our language in the course of the last few months. They have done so, as far as I am aware, with a minimum of indiscretion, and without, so far as I can see, any departure from sound, liberal, democratic principles. But with a Government so constituted it must necessarily happen from time to time that the same principle—although, I think, I said last night that we spoke substantially with the same voice—yet the same principle finds a somewhat variegated expression, but, so long as it is the same principle, I should have thought that it was a matter rather for congratulation than reproach that we are able to present it in so many different forms for the instruction and exhilaration of our fellow-countrymen. I make that as a prefatory observation. But the right hon. Gentleman remarks is there any difficulty in answering the question which he has put, or is there any difference of opinion in the recorded utterances of Members of the Government as to the answer which should be given? The question, as I understand, is this: Do we contemplate that a tax of this kind imposed on the manufacturer of a particular commodity will, or will not, be passed on to the consumer?

That is one question, and the other is: If it is passed, on what fraction can be put by the manufacturer on the commodity which will not greatly exceed the amount of the tax? That is the second question.

That is a subsidiary one. It is involved in the other. I have not the faintest difficulty in answering that question, either on the ground of ethics or on fiscal ground. The right hon. Gentleman actually started an ethical question in the midst of this fiscal controversy. He asked if it is right, if it is moral or proper to pass on the burden. I never met anybody who entertained any doubt or difference of opinion on the point as to whether, if a tradesman or producer or manufacturer, or importer of a commodity, I do not care which, by reason of a duty imposed by the State on that commodity is deprived of the profit which he would have made it is or is not contrary to the ethics of trade or even of Christianity that he should seek to pass on the additional burden to the consumer, and in that way recoup himself. Anyone who has followed the discussion of what is known as the fiscal question during the last few years must be familiar almost ad nauseum with that particular principle, and with the numerous illustrations which have been given. Let us put aside all question of ethics and look at the question of what is fiscally or practically proper or possible. As I have said the producer will do what he can. It is quite true when you are dealing with a commodity like alcohol in, ail its forms it is extremely difficult—and this applies to many other commodities besides alcohol, but it is peculiarly of alcohol—to adjust or compose your duty to such an amount that you can be quite certain that the process will be carried out with anything like what I may call mathematical accuracy; that is to say, so that the-quantity of the burden imposed on the-consumer will not exceed the burden imposed on the producer, and will not, therefore, exceed the revenue coming to the-Exchequer. That is one of the every day problems of taxation. The right hon. Gentleman and his colleague (Mr. A. Chamberlain), who was Chancellor of the Exchequer, are perfectly familiar with it. They have had to grapple with it. They put extra taxation on alcohol at the time of the war. Was that passed on to the consumer, and, if so, how? I observe a speech made by the right hon. Gentleman the late Chancellor of the Exchequer, when he was Chancellor of the Exchequer, on 23rd May, 1905, when this very question was being raised. It was asked how this duty, which was put upon beer, was passed on, and in what proportion from the producer to the consumer? The right hon. Gentleman said:— It was said that the beer drinker now received a less desirable article than previously. He did not believe that there was any proof to support the suggestion that a more 'thirst-producing' article was being manufactured and consumed in consequence of these war duties. What had actually happened was that the price of a glass of beer had remained the same, though the amount of water in it had been increased. So it seems there is a variety of ways beyond the crude expedient of raising the price in which this burden can be transmitted from the producer to the consumer without any serious disturbance to trade, and without any injury to the community. The right hon. Gentleman has referred to a phrase of my right hon. Friend the Chancellor of the Exchequer, in which—I do not suppose he was professing mathematical accuracy—he said he was endowing the brewer with something like £20,000,000 in return for about £3,000,0000 or £4,000,000 he was taking for the Exchequer. That was a statement made on an assumption which was well founded at the time by an apparent declaration, which was public property, of the intention of the brewers to recoup themselves for this very small duty which was being imposed upon them by this Bill.

To recoup themselves for the relatively small duties which were being imposed upon them by this Bill they were going to raise the retail price of beer to an amount which would not only make up the amount of those duties, but would give them an enormous sum by way of profit. I do not know whether that action of the brewers has taken place. If it has I believe it has been confined to comparatively narrow localities in the country. I do not express any opinion about that. That at any rate was what my right hon. Friend had in his mind when he made the statement to which the right hon. Gentleman has referred. To sum up what I have been saying, my answer to the question is this: Ethically, if we are going into the ethics of the matter, I see no difficulty of any sort, and mathematically the difficulty with which we are faced in this is identically the same as, neither greater nor less, than that which beset previous Governments who have dealt with the same matter, and I have no doubt that one way or another in the course of time—I will not say whether precisely, as pointed out by the right hon. Gentleman—a considerable part, if not the whole, of the burden of this Bill will fall on the shoulders of those who are the consumers.

We have heard references to the necessity caused by the taxation imposed by the Government which forces brewers either to put up the price or in some other way to pass on the increased taxation. I am reminded very much of a phrase we used to hear one time in these controversies that the unfortunate taxpayer should be invited to contribute to enable the Government to build "Dreadnoughts," and that the invitation should be reinforced by all the resources of civilisation which the Government can bring to bear. Very much the same invitation is now being issued by the Prime Minister, to pass on this taxation to the customer. Are we to understand that the method recommended by the Government is that the brewers should water their beer in order to enable them to secure the dividends for their shareholders and to enable their business to continue to exist s I think from a political point of view that would be a most excellent statement to be able to make outside this House, that that was the advice which was given to us by the Prime Minister en this question. It is perfectly certain that the retail trader of this country is not able to bear any increased taxation. Hon. Members on the other side of the House talk as if they seem to think that the total contribution of a brewer, large or small, to the needs of the State is the £l Administration Duty he now pays for a brewers' licence. Take my own case. We are not large owners of tied houses. I should say that probably we own a very much smaller proportion of tied houses than almost any other brewer. I took the trouble to take out the figures of our returns of the past year, after all the expense and all the costs of the business, and leaving the remaining sum to be divided between the Government and our shareholders. I find that we paid over 71 per cent, of our return in taxation to the Government of the day, and we had less than 29 per cent, to divide between our shareholders. And yet the brewers in this country are accused of not making an adequate contribution to the revenue. We make an enormous contribution to the revenue. As it has been so well put in the early part of the Debate, we pay the Government one-third of the taxation which they need, and we also have a big loss in other ways. On every bad debt which we make, and every barrel of beer which we lose, we still pay taxes to the Government, and we lose not only our own property but we lose the tax which we had to collect for the Government. I do not want to pursue that at any greater length, but the Government know themselves that the returns of the brewing trade are now very small, except in a few instances. I have kept for many years now a record of the earnings of all the brewers in this country, and I find that in late years, although the capital has been largely reduced, yet on this largely reduced capital the earnings have been steadily falling, and during the year ending on December 21st last the total earnings of the brewing trade on this largely reduced capital are not more than 4¾per cent. I do not think there is anybody in this House who will contend that 4¾per cent. is a large or even an adequate return on a business which is attended by more risks than is the case with most trades. And those risks are now to be added to by the political and public action of the present Government. On what ground do the Government consider it desirable that the smaller men should be crushed out by the burden of taxation, and that there should be amalgamation of interests? Do they consider it to be to the advantage of those who are seeking employment, or those who purchase beer that this process of amalgamation of different concerns should go on j until the whole country is locked up into one enormous trust, or a group of trusts? The Government are deliberately stimulating them to that course by this taxation. We have heard from every platform in this country of the great monopoly enjoyed by the licensed I trade, and there is a great deal of talk about the tied-house system as something which they want to get rid of. The idea is that if they stop those tied houses they will abolish a very undesirable thing, and they speak of the system in very strong terms as one which ought to be swept away. An hon. Member opposite justified the Licence Duty being charged on an increased scale because the smaller old dealers are becoming less numerous, the small brewers taking their place, and, therefore, these small brewers ought to pay the Licence Duty after taking the place of the old dealers. What does the hon. Member mean by that? Does he mean that the small brewers ought to take to hawking the beer? Is that what he wants? Is that the policy of the temperance party? At any rate, it is exactly what they are leading up to. Another matter which has not been referred to in this Debate has reference to the Licence Duty on the manufacture of British wines and cider. I do not propose to pursue the subject of British wines. I do not know what they are. I believe technically they are called "sweets" The manufacture of cider, however, is an important matter. I understand the Government contemplate abolishing altogether the Licence Duty on the manufacture of cider. I believe there is an Amendment on the Paper. At any rate, an announcement has been made to that effect. If that be the Intention of the Government—and it is one to which I do not offer the slightest opposition; it is a perfectly right thing to do—on what principle are they going to put a tax on the manufacture of a similar article? Are they going to do away with the Licence Duty upon cider, and tax an industry which produces an article of a similar nature? This appears to me to be one of those instances where the Government finds it expedient, acting on the advice of their agents outside this House, to make a change in respect of a tax which is certainly extremely unpopular. While they are doing the right thing in respect of the tax on cider, in regard to a similar industry they declare war on every plat- form in the country, though they are not able to justify their action on any sound principle. With them it is a mere matter of expediency. They say they want money, and that they must extort it where they can get it. That is a principle which would equally justify the backwoodsman in America in holding up a train or a highwayman in holding up a traveller.

I do not think this Debate should close without some words as to why it is possible to support this part of the Clause and vote against the Amendment for other than what are usually called party reasons. We have now had a Debate of three hours on strictly party lines, during which we have heard the usual conventional abuse. I shall support the Government on this Clause, and vote against the Amendment, though to the greater portion of Part II. a man who believes in self-government by the English people will vote against. But the particular provision which we are now debating—the tax on brewers and distillers, and particularly on brewers—is a thing for which one can vote with a perfectly clear conscience. One does not vote for it because it is an interference with the manufacture of fermented drinks. I confess I have never been able in my life to understand how any man can mix up two principles which have no sort of logical connection—democracy and the consumption of a particular kind of drink. I know there are people who mix up the two ideas, which stand logically as wide apart as the Poles. This underlying idea which many of my colleagues have, that in some way they are helping the good cause of the Liberal party, or Liberal traditions, by interfering with the ordinary domestic habits of their fellow citizens, is to myself a contradiction in terms. If it were put to the popular vote there would be invariably an overwhelming majority against any interference with these common domestic matters. The arguments used on the other side with regard to raw materials are perfectly justified. Raw materials, especially barley, have increased in price, especially between 1906 and 1908, and I think that those Members who are interested in agricultural affairs will agree with me that the price of cereals in general is likely to increase or at any rate remain at a high level for some time. That argument is perfectly sound. The reason one votes for this tax is that it is the only part of the Bill—the only small part—which gives some advantage to the free houses still remaining. I do not know much about the tax on distilleries, but I am competent to talk about the tax on breweries, and I think if the tax on breweries were made larger it would be passed on to the free houses. As it is, I think so small a tax as 2⅞d. on 36 gallons cannot, and will not, be passed on to the free houses. That merely small differentiation in their favour becomes as light dust in the balance, that little more than dust in the balance which makes me vote for this proposal, which I supported on the second reading, and which I shall support again.

I wish to ask the Prime Minister a question, if I may, in order that there may be no misapprehension as to the statements he has just made. We have had from the other side a statement that it is quite impossible for the beer trade to stand this extra taxation. Hon. Members have quoted the language which was used, for instance, by the director of one of the suburban companies, who have paid 22 per cent, for the year, including 8 per cent, arrear for the previous year. He proceeded to politics, and said:— We have, gentlemen, the London brewers raising the price of beer in self defence. Gentlemen, I submit the liquor trade cannot bear further taxation. 7.0 P.M.

On his statement there seems to be a margin for possible extra taxation; but what has been their demand? Their demand has been that it should be shifted on to the consumer. I take it that the Prime Minister's statement referred strictly to the matter under discussion in this Amendment—namely, the 3d. per barrel. It has been said that the small man brewing some 10,000 barrels per year is going to be ruined by this extra taxation. He is able to pay a duty of 7s. 9d., and still survives; but the extra 3d. per barrel on the 10,000 barrels, which means an extra payment of £120, is going to turn the scale, and it is going to destroy him and stamp him out of existence. That seems to me unlikely. I doubt if the small breweries could be carried on on such an exceedingly small margin of profit, for, if so, they are at the mercy of ordinary trade fluctuations more than that. I allude to that because it was said last night, and a claim was put in on behalf of this small man. I frankly think that this 3d. per barrel is too small for any consideration whatever. What have we had? We have had, in the Kennedy judgment, experts coming forward and saying in their sworn evidence that the profit per barrel was 14s. 6d., and the trade experts put it as between 13s. and 15s., and as a matter of fact they are getting 10s. per barrel in compensation. On that there is a considerable margin for paying extra taxation for the profit on the monopoly which the tied-house system secures. I think, therefore, out of their profits it is possible to pay the extra charges which this brings. There is one other way in which they can meet this 3d. Here is the case of another brewery, and at the meeting in May the chairman said that:— As early as March last they had commenced to-increase their stocks of spirits in view of possible Budget proposals. Between that date and the introduction of the Budget they had effected very considerable clearances of dutiable goods, and the profit accruing from this transaction would be a very pleasant feature of the balance sheet for the current year. So that there is some balm in Gilead even when there is a Budget. I therefore feel quite certain it would be possible for this trade with its enormous resources to-stand the 3d. per barrel without passing it on to the consumer, but there are divers ways in which that can be done. I trust that the Prime Minister's statement was. limited to that 3d. per barrel which we have been discussing to-day, because I think when we turn on to the other burdens which may fall on the brewing trade they are not on the value of the trade. I think it has been said that the Irish and the Scottish breweries, which are so ably represented by the hon. Member for Ayr Burghs (Mr. Younger), will gain an unfair preference against the English breweries as a result of the Budget. When we turn to this question of Licence Duties surely we are in a different region altogether. There we are taxing not a commodity, but taxing the monopoly to supply that commodity; we are taxing the privilege to supply a special article. That taxation is really a tax on rent, which naturally falls on the owner of the monopoly, who has got no right to shift it on to the consumer at all. I only rose to make that point clear. I trust that that view is a perfectly sound one. That was the view of Mr. Gladstone when he raised the Licence Duty in 1880. He claimed then that the Legislature was justified in putting extra taxes upon monopoly value which by legislation licensed premises had acquired. I venture to think that this is a tax similar to a tax on rent, which there-is no justification for passing on to the consumer at all, and which ought to fall upon the owners of the monopoly. It is not for me to attempt to submit points in economics to the Prime Minister, but I venture to think that is a tenable view. I trust his statement was limited to the manufacturers' duty.

I wish to ask the Prime Minister for some further information about the statement he made earlier in the evening. My right hon. Friend drew attention to the effect which this duty on manufactured spirits would have as regards industrial alcohol. The Prime Minister said that had not escaped his attention, but that the percentage added to the cost of that spirit was so small that it could not have any effect. Earlier in the evening, in reply to some observations of mine, he placed the percentage at one-third of 1 per cent. I want to know how he arrives at those figures. The right hon. Gentleman says now he was then speaking of a different thing, and I misapprehended. I put the duty as being equivalent to 1 per cent., that is, taking the cost of the article as 10d. per gallon, which I should have thought, for industrial alcohol, was decidedly above the price which they habitually pay. I believe I am correctly informed that quite recently they could have purchased suitable spirit for this purpose at something like between 6d. and 8d. per gallon. At 10d. per gallon a tenth of a penny is 1 per cent.

I am told that it altogether depends on the price you pay for the gallon, and I am told the usual wholesale price is a shilling, but at present it is even higher, and ranges as high as Is. 2d. Assuming the price as a shilling, the charge made here is one-tenth of a penny, and works out at 85 of a penny. If you take it at the higher point it is 66 of a penny.

It did not come in that connection. I was speaking of another matter altogether.

Assuming the twenty millions of money which is supposed to accrue from the trade by the smallest price which can be placed on the article sold, that price will not return one penny of profit to the trade as a whole. I have stated in a letter which I wrote to the Chancellor of the Exchequer that the burdens on the trade were too great, and I enclosed figures which I now allude to, and which can be placed in the hands of any Member of the Committee who desires to see them. They prove that by a rise in price even of the smallest possible amount the amount sold is reduced by at least 20 per cent., and by reducing the amount of production in breweries the cost of production is so increased that there is no actual profit accruing to the brewers from the increased price paid. I want that fact to go to this Committee, and it is a fact which may be verified by any member of this Committee who chooses to examine the figures. The tax is one, therefore, which will not produce any profit to the trade. We have an illustration at the present moment as to the effect of the Spirit Duty. The Prime Minister said that the figures which had been produced could not be relied on, because there were large amounts of stocks in hand. I can supply him with the figures of the actual amount of spirit sold over the counter which is not relative to stock at all. The actual sales over the counter as compared with the months in previous years have diminished no less than 40 per cent. That means that the Chancellor of the Exchequer will derive no benefit from the increased Spirit Duty. In the same way I give a warning to the Chancellor of the Exchequer that from the extra price which he will charge on beer he will derive no benefit, either from the increased duty or the extra money which the poor people in this country will have to pay.

Question put, "That the word 'manufacture' stand part of the Clause."

The Committee divided: Ayes, 201; Noes, 111.

moved, to leave out the words "or sale" ["licence for the manufacture or sale of intoxicating liquor."] The last Amendment dealt entirely with the manufacturers. This Amendment deals with the other side of the shield, namely, the retail licensees. If the last Amendment was important, as it undoubtedly was, dealing, as it did, with the question in its broad aspects, this Amendment certainly, from a monetary point of view, is of much greater importance. The last Amendment involved about £400,000; this Amendment involves, according to estimates I have received from those best able to give an opinion on the matter, no less than £4,000,000, or £1,400,000 in excess of the estimate of the Chancellor of the Exchequer, unless—I am bound to put in this proviso—in the course of the operation of the new Licence Duties a great number of the weaker houses are swept out of existence. Perhaps it will make it easier for the course of the Debate upon this matter if I am allowed to contrast generally the new scale of licences proposed by the Bill with Mr. Gladstone's scale of licences in the Act of 1880.

On a point of order. This Clause, with the Schedule attached to it, proposes to impose certain Licence Duties upon persons engaged in the manufacture or sale of intoxicating liquor. On the previous Amendment we have discussed the Licence Duty on manufacturers, and I gather from the observations of the hon. Member (Mr. Faber) that he now proposes to go broadly into the general question of Licence Duties on retailers. I should like to ask whether, if general debates are taken on these two points at this stage, when we reach the question that the Clause stand part of the Bill it will be admissible to repeat the Debate upon these points.

That is the very point that arose yesterday, when I expressed the view, which has not been contradicted, that we might generally allude to everything in the Schedule, although we should not go into detail.

That does not seem to me to have anything to do with this particular point of order. As the right hon. Gentleman has suggested, the words "manufacture or sale" do cover the operations of the whole of the Clause. In fact, it would not have been in order to move to omit those three words altogether, as it would have negatived the whole Clause. Therefore, as we have had a long and general Debate on the first point, and we are now to have a similar Debate upon the second, I should certainly deprecate a similar Debate being raised on the question that the Clause stand part of the Bill.

May I ask whether it is not a familiar experience in this House, when a Clause embodies a principle, that that principle is discussed constantly upon some Amendment to the Clause and re-discussed upon the Clause itself? I am sure that I could remember countless instances on the Education Bill of 1902 and on other Finance Bills where that has been done. I quite agree that there should not be any unnecessary reduplication, but there is nothing inconsistent with the practice of this House, is there, in surveying a Clause of which the main principle has been discussed on some Amendment?

Is it not the fact that when the question, "That the Clause, as amended (or not amended), stand part of the Bill" is put from the Chair, it is always allowable to discuss the effects of that Clause, regardless of what has taken place before? I know it has been held that it is not convenient that it should be done, but I do not remember its ever having been ruled that it was not in order to do so.

That is exactly the point raised before. I have not said that I should rule any such discussion out of Order. I simply said, as a matter of fact, that I should deprecate such a discussion.

The last thing in the world that we on this side have any desire to do is to re-duplicate any discussion. If the discussion happens to overlap, that is our misfortune, not our fault. When the right hon. Gentleman raised the point of Order, I was about to refer to the Licence Duties in Mr. Gladstone's Act of 1880. Looking at the scale of Licence Duties there, one is struck at once by the significant fact that it is not cast in an iron mould at all. Intentionally no doubt that great master of finance, probably unapproached in that direction during the last half-century, left the scale in that elastic state. The scale began with a duty of £4 10s. where the annual value of the premises was under £10. Then, between £10 and £40, the scale reaches its highest point. There it is rather more than 50 per cent. We go higher up in the scale, and see that the relation of the duty to the annual value of the premises becomes less and Jess. Mr. Gladstone graduated it, it is true, but instead of graduating upwards he graduated it in the other direction. The higher the annual value of the premises the lower the duty. And he did so, it seems to me, from a very plain, obvious, and common-sense reason. As the annual value of licensed premises becomes higher the licence bears less and less relation to it. All sorts of other considerations come in. If you take the site value as your cardinal principle, you may get into all sorts and kinds of difficulties and of injustices. It must be manifestly unjust and unfair to follow the principle of adjusting your Licence Duty to the annual value too stringently. What does the present Bill propose to do? It proposes for all ordinary on-licensed houses in the country to make the licence half the annual value of the premises. There is no distinction between them. That is a cast-iron rule. The absurdity of the proposal was revealed earlier in the Debate on the Resolution. In regard to the larger licensed houses and hotels of the country, and the great cosmopolitan buildings which accommodate people from all parts of the world, and which have an annual value running into thousands of pounds—in some cases £10,000, £15,000, and £20,000—their duty, according to the scale, would be half the amounts I have stated. Exceptions, I believe, are introduced into the Bill, to which I need not allude at present. But as regards the great mass of on-licensed premises, the duty will, if this Bill becomes law, be half the annual value of the premises. I will not allude in any detail to the general proposals of the Bill as disclosed in the Schedule. I think the enormous change introduced by the Bill, in contradistinction to the scale laid down in Mr. Gladstone's Act, becomes manifest. Under that Act the present 89,493 full or publican's licences vary between £4 10s. and £60. In respect of the whole of them you are now going to substitute half of their annual value. There are 28,800 beer-houses in this country which pay a present duty of £3 10s. You propose to substitute one-third of the annual value, and, worse still, they will be subject to the minimum scale. The wine or confectioners' duty at present is £3 10s. Under the new scale they will rank on the scale of annual value from £4 10s. to £12. When you come to the off-licence holders, though the hardship might not be quite so grievously apparent as in the case of the on-licence holder, still their hardship is undoubtedly very great. I am talking of the Bill as drawn. The spirit retailers' additional licence at present is three guineas. There are 9,754 of these in the country who are to be put upon the scale of annual value, and they will rank for duty between £40 and £50. Grocers' licences, including Scotland, are at present four guineas to 13 guineas. There are 3,600 of them, and they will rank again in the scale of annual value from £14 14s. to £35 15s.

In Ireland the present duty is £9 18s. to £14. There again, by putting them under the scale of annual value, they will rank between £40 and £50. There are 11,800 beer retailers in England. At present they pay £l 5s. In future, under the scale of annual value, they will rank between £3 10s. and £10. And that does not exhaust the hardships. I alluded just now to the minimum duty proposed in the Schedule of the Bill. That is, the minimum according to population. The meaning of that is that the higher the population of any particular centre, the higher shall be the minimum duty. There again, in the case of the minimum duty, you have entered upon a long and wide departure from Mr. Gladstone's rule in his Act of 1880. There the most that could be charged to a small house was £4 10s. But under the new minimum plan the regulating of the minimum duty according to population, the smallest duty certainly in London will be £35. Therefore it must be perfectly evident to the Committee that the proposals of this will do involve a tremendous departure from the practice that has obtained in this matter for the last 29 years.

The Chancellor of the Exchequer has always been open to argument in the owing cargo overboard. Last night it was Ireland to which concessions were promised. Large concessions have been promised by the Chancellor of the Exchequer to the off-licence holders. Let me not be misunderstood. I am glad these concessions have been given to the off-licence holders, because I do not in the least desire to take the line of argument that because I cannot get justice for the on-licence trade of this country that I therefore wish in any way to resent, in the circumstances, some benefit to the other branch of the trade—the off-licence holders. The off-licence holders have been fortunate owing to the strength of their arguments to obtain much more from the Chancellor of the Exchequer than would ever have been granted by our protestations on this side of the House. I do not say that the whole of their grievance is removed. I do not think it is. But compare the treatment meted out to them since the Bill was introduced! A change has come over the spirit of the dream, which is no doubt very great and marvellous. It does not only rest upon the matter of the grocers' licences. It is something more than that. The Chancellor of the Exchequer made another concession in the Schedule in relation to the amount of spirit grocers are allowed to sell for consumption off the premises. Hitherto the minimum a grocer, at any rate in this country, could sell off the premises has been a quart bottle. The Chancellor of the Exchequer, in the kindness and fullness of his heart, and in one of his most generous moments, proposed—after consultation probably with Sir Walter-Gilbey—that in future the inestimable boon would be conferred upon the grocer of selling for consumption off the premises spirits not only a quart bottle, but the fourth part of a quart. We have already entered upon a christening process in relation to this small measure. It has been called the "Little Lloyd-George." I can imagine with what haste the Chancellor of the Exchequer dashed down last week-end to the yacht of Sir Thomas Lipton—how they almost rushed into each other's arms, and how the Chancellor of the Exchequer told the worthy baronet of the concessions he had been able to secure for the grocers, and how the duties at any rate would be small in comparison wit what they were as first drawn up. He would say, too, how, over and above all that, in future the grocers all over the country would be able to sell for consumption off the premises in competition with the on-trade, whisky in the small bottles which I have described. But there's many a slip between the small quartern bottle and the lip. These little bottles, like Radical promises, were, I think, made to be broken. No sooner was this promise made—or perhaps I should say no sooner was the promise made public—than a great stir arose in the temperance camp. Even temperance reformers had to draw the line at this proposal. No sooner was that Amendment in favour of the grocers put upon the Paper than 24 hours afterwards it was taken off the Paper. The skill of the Government draftsman—

Very well, Sir, I will not pursue the matter any further. I will say this only, and then I pass away. When I regard the whole episode I am reminded very much of that—

I pass from that, and I am very glad they have got the concession I first alluded to, and I come now to the question of the on-licensed trade of this country, which, after all, is the matter in which I am most nearly concerned. There are something like 89,000 of them, and what you are proposing to do is to extinguish them, if you can. I stated in the earlier part of my speech that the Chancellor of the Exchequer estimates that he will get £2,600,000 from the increased Licence Duty, and £1,600,000 on the increased duties on spirits. That will have the effect, so far as the ordinary dividends made by the brewery companies is concerned, of extinguishing them altogether. Something like £4,000,000 was paid in ordinary dividends by the brewery companies, and all that you are going to sweep away. Here you are not dealing with the great brewery owners. You are dealing with thousands of shareholders all over the country, and you are sweeping away by one fell swoop all their ordinary dividends. Not only that, but the companies will in some oases be left with a very large deficit, which will have to be put against the debenture and preference dividends. It must not be forgotten in the course of debate that when you are proposing to turn inside out and upside down the scale of duties established by Mr. Gladstone 28 years ago, the taxation of the trade has not stopped still since then. In one way or another it has been, I will not say punished, but constantly the victim of fresh taxation; and during the whole of that period rates have been going up. Other trades and industries in the country are not rated in the same way. In this country Licence Duties are based upon annual value, and if the rates go up the Licence Duty follows. How many times between the years 1888 and 1909 have both parties in the State increased the taxation which has been put upon the trade? During the last six, seven, or eight years, consumption apparently having reached the top point, remained stationary for a time, and has now evidently markedly begun to decline. Each of the Budget speeches of the Prime Minister when he was Chancellor of the Exchequer showed that the productivity of taxation on alcohol was decreasing. The Government were warned by the fact that consumption was going down. The taxes were falling. The Prime Minister in one of his speeches made upon the Budget said:— The growing elasticity. I might almost say the stagnation or retrogression of that part of our revenue which is derived from alcohol—the shrinkage from alcohol is a fact which every Chancellor of the Exchequer must recognise. The Chancellor of the Exchequer remarked upon the same ominous fact. Here both the Prime Minister, the Chancellor of the Exchequer, and the President of the Board of Trade are one. In their speeches they all gave the same three reasons for the new taxation. They said that increased taxation was necessary for old age pensions, for the Navy, and because of the decrease in the revenue from alcohol. Then, in the same breath, in which they point out that part of the decrease in the revenue was to be attributed to the decrease in the consumption of alcohol, they proceed to put fresh taxation upon it. One of the first canons of taxation is that the moment you see a trade decline in value you ought to ease off the burden, or else you arrive at a point where the more taxes you put on the less revenue you get. It seems to me that from the point of view of the Exchequer the present action of the Government is almost madness. The result may not be apparent at the present moment, but if you take your pitcher to the well too often the result will be that you may find it gets broken. And in the same way, if the whole of this revenue from alcohol fails you, I do not know where you are going to turn for your money. You are drawing no less than 38 millions of money out of alcohol in one way or another. That is more than one-quarter of the whole revenue of the State, and, not satisfied with that, you now propose to add £2,600,000 in the shape of new licences and £1,600,000 in the shape of increased taxation on alcohol. Experience of the whisky tax has shown that you are carrying this too far. There has been something like a drop of 40 per cent., I am told, in the consumption of that commodity. Now I wish to make a few remarks as to the increase made by the London breweries in the price of beer. The Prime Minister said earlier in the discussions he did not in any way blame the trade for trying to get back these increased Licence Duties out of the consumer. These are his words, and I think they are worth putting on record. He said: I come lastly to the higher liquor duties. If the state of the case which they (Whitbread and Buxton) represent is likely to correspond with the real facts, the matter will he set right at the expense of the consumer ‥… and I do not think the result will be a bad thing from the social point of view, though it might not be altogether convenient to the Chancellor of the Exchequer if, partly by a consolidation of licences and partly by a rise in the price to the consumer of the articles sold, the consumption were diminished. 8.0 P.M.

Therefore the Prime Minister does distinctly lay down once and for all that the trade are doing nothing in any way reprehensible in trying to get back by raising the prices to the consumer what has been put on in the way of new taxation. London has done it. London felt obliged to take that step. I am told so far they reap no advantage. What becomes of the mythical £20,000,000 of which we heard earlier from the Chancellor of the Exchequer, which the licensed trade of this country are going to put into its pocket, by reason of the increased halfpenny put upon beer. If London is any guide the best that will happen is that they will get back what the increased Licence Duties is going to cost them. I am told if you have a 20 per cent. drop in the consumption of beer that the loss thereby will be greater than the gain from the increased price. If there is a 15 per cent. drop in the price of beer they will just be able to balance accounts. Therefore, I do hope that the Committee will sweep away out of its mind any idea that the trade are going to be enormous gainers by reason of the increase in the price of beer, if the trade generally feel obliged to adopt that course. It is greatly to be deprecated, especially in face of the quotation which I have made from the Prime Minister's speech, that the Chancellor of the Exchequer should have gone out of his way to say at the overflow meeting at Limehouse that the publicans were obtaining this money by false pretences. And I think it is greatly to be deprecated that his twin brother in these matters, the President of the Board of Trade, should have gone one step further and talked about swindlers. It seems to me that the right hon. Gentleman, the Prime Minister, has only got to lay down a proposition upon any occasion in order that on the first opportunity he may controvert it. Why have the Government decided to put these largely increased Licence Duties on the back of the trade of this country? Is it for temperance? Is it for cash, or is it for revenge? If it is for temperance, then I say that is no part of the duty of the Chancellor of the Exchequer. The right hon. Gentleman should budget for money, and it is not his business to include in his Budget measures of social reform. These Clauses have been introduced more to gratify the strong feeling of the extreme temperance reformers, who support the Government, than to bring revenue into the coffers of the State. I am not certain that in the long run these increased duties are going to bring in any increased revenue. The Chancellor of the Exchequer may not gain anything, because there will probably be a great drop in the consumption of liquor, and in that case he will perhaps lose more revenue than he will gain. I am getting more and more back to the belief that the strong feeling at the bottom of the whole of this matter is revenge—revenge, first of all, against the trade, which is regarded as the political enemy of hon. Gentlemen opposite; and, secondly, the Government have not got over the fact that the Licensing Bill was thrown out last autumn, and thrown out with the full approval of the country. Now you are bringing in a Licensing Bill in another shape. This is an open secret, because it has been proclaimed on almost every housetop by every Member of the Government. We were told last year that if the Licensing Bill was thrown out the trade would be made to suffer, and we were told that revenge would be taken under the next Budget.

Really the hon. Member is getting very wide of the Amendment. He is talking about the whole Bill, and that is not in order.

The form in which this Amendment is drawn rather puts me in a difficulty, but I will conclude by saying that I think the new duties are punitive, and are not warranted by the circumstances of the case. They depart very far from the scale of duties which were considered sufficient by Mr. Gladstone in 1880 when the trade was in a much more prosperous state, and I do not think it is fair for the Chancellor of the Exchequer to impose now exceptional burdens of this kind while at the same time letting other trades of the country go practically scot free.

On this side of the House we consider that the main object of the Government in bringing forward these taxes is revenge against the trade on account of the rejection of the Licensing Bill of last year. The right hon. Gentleman the Member for Spen Valley (Sir Thomas Whittaker) said recently: "As they could not get the Licensing Bill passed the obvious plan was to increase the duties." Why were the duties being increased? Obviously because the Licensing Bill was not passed. The Secretary for Foreign Affairs spoke very differently. He said:— There is far too much good will in the British community to make any large section really wish to see others taxed for the sake of penalising them. Anything in the nature of vindictiveness would have, I am convinced, no chance with the country. I hope the right hon. Gentleman will take those words to heart and give the country an opportunity of expressing their opinion as to whether they think these taxes are vindictive or not. The case I wish to put forward is that this trade is already taxed up to the hilt, and cannot stand any more. Even from the Chancellor of the Exchequer's point of view it is bad finance to tax the trade in such a way as to produce a lot of revenue, and this is what is going to happen under these proposals. An estimate was given in "The Times" the other day of the probable produce of the Spirit Duties during the present year. It was a very careful estimate by a capable man, and it asserted that the Government are going to be out of pocket by a sum of £200,000 because the duties would yield that much less than they did last year. The trade pays altogether towards the tax-revenue of this country £38,500,000, which is equivalent to 29.4 per cent. of the total tax revenue. Notwithstanding that the Government propose to make the trade pay more. That amount of money includes extra taxation, which was put on as a temporary matter. The war taxes were put on by Sir Michael Hicks Beach, who stated that he put them on as a temporary thing, and the taxpayer was to be relieved of them as soon as the war was over. Those taxes are still imposed, and at the present time the war taxation on the liquor trade amounts to £2,500,000. Then there is the Whisky and Spirit Duty, which was put on in 1890, and has been paid for the last 19 years, and amounts to £500,000. That money was voted as compensation for the reduction of licences, but it has been used for other purposes. Then there is the compensation levy, and that is a very severe tax of something like £1,000,000 a year. The four taxes I have named amount to something like £4,000,000. What have you by the side of that extra taxation. You have a decreased consumption. It may be a matter for congratulation that the British people are getting more sober. We are all glad to hear that, but from the Revenue point of view it is not so satisfactory. The Chancellor of the Exchequer told us in his Budget speech that during the last nine years the consumption per head of the population of beer in the United Kingdom showed a falling off of 5.28 gallons per head; of spirits, a fall of .31 proof gallon per head of the consumption; and of the consumption of wine, half of the amount. We are told that there has been a substantial decline for the whole period of 10 years in the trade. Is it reasonable, when you have this declaration as to the consumption of liquor, to try and punish the trade by this extra heavy taxation? The taxation of alcohol and tobacco amounts to something like £52,000,000 out of a total of £130,000,000, or two-fifths of the whole amount. That means that those who do not smoke or drink do not pay any part of that two-fifths. Of course, I commend them for their abstinence, but is that any reason why any large part of our population should get off without paying their share of the extra taxation required? My opinion is that everybody ought to be taxed equally as far as possible according to their means. Why should a large part of the community be exempt from paying a fair share of these extra burdens as they are exempted by this Budget? I have had a paper sent to me, and perhaps the Committee will pardon me if I allude to it for one moment. This Budget falls especially hard on large boroughs of over 120,000 inhabitants. In such boroughs, as well as the London boroughs, the minimum duty affects the trade very severely indeed. The Committee are aware that the present beerhouses pay a fixed duty of £3 10s., whatever the annual value may be, but under these Budget proposals that fixed payment of £3 10s. is to be raised to a minimum of £23 10s. for every beer-house in our large boroughs.

It is quite sufficient in many cases to close those houses entirely. We have in Sheffield as many as 534 beer and wine licensed houses with a taxable revenue of £1,886. Under this proposal that amount is to be raised to £15,922, or nine times the amount they are paying at the present time. Is not that sufficient to close these house? But that is the object of the Government. The Lord Advocate has expressly stated that his wish was to close one-fourth of these houses by imposing such a duty upon them that they would not be able to bear it. The total now paid in Sheffield by License Duties amounts to £19,000. Under the proposals of the Government that will be increased to £49,000, an increase of £31,000, or 165 per cent. If you add to that the extra Spirit Duty of 3s. 9d. per gallon, estimated at 2,900 gallons weekly, the new Brewer's License Duty of 3d. per barrel, and the additional licenses paid by the wholesale houses of £800, you get a total increase in one large county borough of £64,000. You must add to that the compensation charges, which amount to £15,000, the war taxes, which according to the prophecy of the Chancellor of the Exchequer of the day were to be taken off, but which are not taken off, £16,000, and £3,770 ditto for spirits; that makes a total increase in this large borough of £98,000 during the last eight years. Is that reasonable? The result, if this Budget is carried, must be that a large number of these houses will be closed and a great many people ruined.

The Yorkshire Brewers' Association have also sent me a paper, showing what will be the result to 28 firms in Yorkshire whose accounts are published annually. At the time of the war, when the taxes were imposed, the whole of these firms were paying dividends on their ordinary share capital. At present 10 of them are paying no ordinary dividends at all. Their profits last year only amounted to 3 per cent. on their preference and ordinary shares, and their total earnings for a period of ten years after the payment of fixed charges, show a drop from £98,000 to £37,000. Here is a diminishing trade, and yet the Chancellor of the Exchequer is proposing to tax them further, in the hope of getting revenue. It is proposed to make the new Licence Duty half of the annual value in the case of fully licensed houses and one-third in the case of beer-houses. I have shown how these will work out in many cases. If you take them in percentages, you will find that, although without the minimum the house under £50 annual value will not be affected so severely as those of over £100 annual value, yet, when you take the minimum imposed by this Budget, the duties both in respect of fully licensed and beer houses are raised very high. The increase per cent. on the £10 house is 580, on the £15 house it is 410, on the £200 house 233, and on the £l,000 house—I suppose there are not many of them—870. The right hon. Gentleman opposite (Mr. Herbert Samuel) has, I know, taken a very great interest in this matter. He assisted last year on the Licensing Bill, and his recent bye-election, I believe, was brought about by the anxiety to get his assistance on these Clauses. I know he is a fair-minded man, and I appeal to him to try and use his influence with the Government to moderate these proposals. It is not for us to suggest exactly what form that moderation should take, but I think we have shown that, it the proposals of this Budget are carried out, a great many of these houses will have to close their doors, and a vast number of people will be thrown out of employment.

There is no doubt, as the Government of all people concerned have had to admit, that this trade is already very heavily burdened with taxation. One would have imagined, listening to the Prime Minister this afternoon when discussing his threepence per barrel tax, that that practically was the only taxation to which this great trade was subject. It reminds me almost of the Chancellor of the Exchequer, who talked of the halfpenny tax on undeveloped land as only a copper. That way of tackling the great question of taxation is im- proper and wrong. If this trade was treated fairly it would, instead of having taxation added to it, have taxation taken off it. One would imagine from the light way in which so-called temperance reformers attempt to tackle this question of the brewing industry that it is the easiest and simplest thing for brewers and other industrial classes to increase the price of their commodities to their customers. Anybody with any business experience knows perfectly well that it not only upsets trade, but diminishes trade, if you increase the price of a commodity in order to pay you for the increased taxation put upon it. The experience of London shows that an increase in price has seriously diminished the trade done. The object of the Bill is obvious to everybody. It is a flagrant attempt to show it is possible by means of a Budget to pass legislation which has been denied.

I venture to think if you had allowed me to finish you would have seen I was quite in order. It is not easy, in tackling this question, to confine oneself to a few simple sentences in order to show those who have not really studied the question and have never been in a brewery, inside a public-house, or on licensed premises, that they are not the bad places which, for political purposes, they try to make them out. If the Government are really anxious to make taxation as light as possible, and to spread it out as evenly as possible, surely it would have been a very easy matter to have tackled this particular form of taxation. They know perfectly well that the easiest, cheapest, and simplest way would be to put the taxation on the barrellage produced. But they are only anxious to smash the licensed premises throughout this country, and they are going the best way to do it. If we want any further evidence of that we have it in the speeches of the leader of the teetotal party, the right hon. Member for Spen Valley (Sir Thomas Whittaker), who, speaking at Scarborough on 22nd June, said that if they could not get the Licensing Bill passed the obvious plan was to increase the duties, for the object was to diminish the value of licences. If we want any further corroboration of that we have the speeches of the right hon. Gentleman the Chancellor of the Duchy of Lancaster. I could give quotations from speeches he has made outside this House in which he has showed the animus with which he has approached this question.

I shall be happy to show them to the right hon. Gentleman at any time. I do not suppose I would be in order in reading them here. Last night we were dealing with an Amendment regarding exemptions for London. To-day we have had a similar question with regard to Yorkshire, and that experience could be repeated throughout the country. You cannot increase taxation on a trade without diminishing the revenue you get from it. The right hon. Gentleman will probably be able to tell us what the effect has been of the increased taxation on spirits. He knows it is a very serious matter. He knows the Government are not going to get anything like what they estimated. I gave last night a list of 11 houses in my own Division of Holborn to show what the effect of this taxation will be. One of the cases was that of the Holborn Bestaurant—one of the best managed places in London. If you are going to throw on that well-managed place, which is resorted to by hon. and right hon. Gentlemen opposite on every occasion on which they can go there, for it is one of the best places in London in which to enjoy one's self—there is no harm in it, and hon. and right hon. Gentlemen opposite found that out when they gave a dinner to the Prime Minister on the land question—I am glad to hear that they then enjoyed themselves —they will remember what that place is like. If this tax is carried that house, instead of paying £60 a year duty, will have to pay very nearly £4,000, and, taking in the aggregate the 11 cases which I have in my list, instead of the present taxation of £558 they will have to pay just upon £9,000 a year.

Has the hon. Gentleman taken into account the reductions of the duty?

I am told that all that has been taken into account. But it is difficult to know exactly what the Government are going to do. One of the details of valuation has yet to be settled on terms with which nobody is yet acquainted. I do not appeal for fair treatment merely— I ask for businesslike treatment; I ask that this question shall be dealt with on busi- ness lines. If you are to be believed you are not introducing this legislation for vindictive purposes. Then deal with it on strictly business lines. Politics should not be brought into these financial matters. To tax in the way you propose to do a trade which is already overtaxed is bad finance. You ask for alternatives; there are plenty of them. You might put an extra tax of 2d. on tea.

That is an extraordinary interruption. I think it will be found on inquiry that when the tax on tea was 8d. the consumption was considerably larger than when it was 4d. There you have an opportunity of taxing all classes.

I think the hon. Gentleman was not very well advised in travelling into the domain of alternatives, and I am sorry he was interrupted by my Friend the hon. Member for North-East Derbyshire, or he probably would have suggested some more commodities for taxation.

I get one compensation. Hon. Members opposite are now learning that taxes fall on somebody, and that when you tax an article you reduce its consumption. If they would only apply that principle to another question they would find themselves probably nearer the truth than they now are. The hon. Member for Sheffield addressed the House a short time ago, and dwelt with tears in his voice upon the terrible effect of these duties in regard to beershops. He mentioned, of course, the case of Sheffield public-houses. I venture to say there will be a general opinion on both sides of this House that the least calamity that could occur would be if this taxation had an effect in that way on beershops, for I do not know any class of business that does more harm and that should be deprecated. Some hon. Members have the idea that this is a vindictive attack upon trade. Surely that charge can hardly be sustained. It may be the duties will add a burden, but when you are taxing trade is it not very desirable to be sure of the nature of that trade? I am here to say that there is one trade in this country, the decay of which can never be said to be against the interests of the country. If carpentering, or if any other trade you like decays, then you know something has gone wrong, but no man can say that the country would not be better off if there was less consumption of alcohol, even if the decreased consumption was large. The Government has taken the bold course of putting upon that trade which burdens other trades the responsibility of this taxation, and that, I think, is a very wise procedure.

Something has been said about who will pay the tax, the brewers or the customers? I do not know what the brewers will do, but I am aware that they made a very good attempt to do something in the past in the way of putting the tax upon the public. From an official publication of the Club and Institute Union, which is not by any means a temperance body, but represents clubs in which alcoholic drinks are sold, a description is given of the way the brewers are acting. It gives an instance in regard to Messrs, Barclay who had a "tied" club. What was the increase they put upon the barrel of beer in consequence of this Budget? Six shillings. That shows the intention of the trade. The club in this instance told them that they would not pay it, and then this great firm offered to supply the liquor at the original price. The club had the independence to say "take all your belongings and get away from the show, we will not have any of your beer at all." That instance is some justification for saying hard things at times about the brewers, and it is examples of that sort that do justify some of the statements that are made about them. It is not enough for hon. Members opposite to tell us that the trade is going to be destroyed, because all of us who have read these Debates know that that has been the condition of the trade since the controversy began. It has always been a dying trade. It has always been on the point of extinction, but it does not die, although some of us would be glad if it did.

I want to deal with one point and one point only. I am not going to speak of the case of the trade as a whole, or the case of the brewers. That has been put partly by the Amendments this afternoon, and partly by the speeches of my hon. Friends this even- ing, nor am I going to deal with the hotels, which stand upon a special footing, nor with the off-licences. I want to deal with the retail "on"-licences. I have had from time to time, I do not know why, to plead in this House the cause of the publican, whom I always have thought of as the drudge of the trade. He is a man subject to any number of regulations very difficult to comply with, and which he must keep, on peril of losing his living, and what little capital he has. I have always felt a good deal of sympathy for a man in that position and a good deal of desire that, if he is carrying on—as is admitted by the Front Bench, though not by the last speaker, he is—if he is carrying on a legal and proper trade, he ought to have fair treatment.

The hon. Member does not deny the legality, but he says he would like to shut the trade up, and I think he takes a line which the Front Bench on the opposite side does not take. I am anxious that the man should receive fair treatment. Last year a measure was proposed with the avowed purpose of closing a number of the "on" licensed houses within a short time, and, after a lapse of a period of 21 years, of annexing or appropriating for the State, the bulk of the profits that were made in the remainder. On that occasion, and under that Bill, compensation, which I thought was not sufficient compensation, was to be allowed to a house which was closed, and a time limit was given in the case of the houses which were allowed to continue. That measure involved, to my mind, an admission which was expressly made throughout the debates by the Prime Minister, that the persons engaged in this trade, having existing licences, were entitled to equitable consideration, and to compensation or notice of the taking away of their livelihood. I want to know what is the treatment to be given to these houses under this Bill? I think I shall show that in substance the effect of this Bill is to close a number of the houses, some thousands of them, possibly as many as one-quarter or one-third of the total number, without any compensation at all, and to annex a great part of the profits of the remainder, also without compensation and without time notice. If that is so I do not see how any Government which brought in and defended the Bill of last year can properly bring in and defend this Finance Bill. I doubt whether many people have considered the effect of the increase of duty on particular houses, and I will give several cases, first quoting the existing Licence Duty and then the new tax. In one case the tax is raised from £50 to £297, an extra charge of nearly £250 a year on the retailer carrying on that business. That means the multiplication of his Licence Duty by 6. In another case the rise is from £50 to £275, and in others from £50 to £260, £45 to £210, £40 to £163 and £30 to £90, in the last case the duty being subject to multiplication by 3. In the case of 30 houses, as the effect of this Bill, there is shown an increase from the present Licence Duty of £1,285, to a future Licence Duty of over £6,000. Take another list of existing houses, partly "tied" and partly free. The duty is raised from an average of £59 a year to an average of £445 a year. On an average you are putting a tax of nearly £400 a year on each of the traders who are in that list. I have another list of 30 houses. The Licence Duty is raised from £1,699 in all to £12,525, or, on an average, from £56 to £417 a year.

May I put the same question that I put to a previous hon. Member: Are the new Licence Duties assessed on annual value simply, or is the option taken into account?

That is taken into account. There have been taken out for me comparative figures showing the value of the option which is given by the £500 Clause, and I am satisfied that in most of these cases the option is of no value at all. I can give lists of houses, from persons who own the houses, showing that this optional value, so far from being lower, is higher than the value on the basis of the Schedule. May I enforce that by some figures? One firm has given me a list of seven houses where the duty under the Schedule comes to £2,252 a year. The duty under the £500 option comes to £2,611, or a good deal more than the Schedule Duties. In another list of five houses, the half Value Duty amounts to £1,156, and the Optional Duty to £l,915, or nearly £800 a year more than the Schedule Duty. The more you study that option the less I think you will find that it is of real value to the larger houses. I have figures, which I shall be happy to give the Government, from four or five large firms who have calculated the effect of the option on their larger houses, and in the great majority of cases there is a loss rather than a gain, so that, of course, the relief offered is of no real value. I do not think the figure given last night of a gain of £300,000 a year to the country as a whole can be substantiated, and I shall be glad to see on what basis the calculation is made. Whether you apply the Schedule Duty, which, of course, is the only duty you can apply to the smaller houses, or whether you apply the Optional Duty, which applies to the larger houses, you will find in every case that you are adding to the outgoings of the man who carries on this lawful trade a very large sum indeed. He is a small trader, who does not expect to make a very large profit; he makes a few hundreds a year—enough for himself and his family to live upon. If you raise the duty by £300 or £400 a year you are taking away the whole of his livelihood, and that can have no other result but that his house must be closed. That is the result of the Bill. I should like to know of any instance in the history of our taxation where the Government of the day, of whatever party, has put upon the individual trader a sudden increase of charge so high, so oppressive, or so tyrannical as this. I do not think the House as a whole has put itself in the position of these men, and considered what the effect would be upon any small trader of a sudden charge of £300 or £400 a year on the takings of his business. That kind of taxation— whether for revenue or for some other purpose—however good it may be in intention, is bound to lead to consequences which, no Government ought to contemplate without a good deal of hesitation. The case of London is, I agree, extremely strong; but London, after all, is only a glaring instance of the injustice which pervades the whole of the Bill. It was quite right to bring forward the case of London, but, after all, the same observations apply, although sometimes with less force, to the whole of the country. You are putting on the trade of the whole of the country a burden which it cannot bear.

Let me illustrate that by comparing the treatment of the on-licensed houses with the treatment of clubs, where intoxicating liquor is supplied. I will give a concrete case, where approximately the same trade is done, and I will ask the Committee to consider what is the charge under the Bill (1) on the on-licensed house, and (2) on the club. These figures are supplied to me from actual facts. In the case of a working men's club in London, the takings for intoxicating liquor amount to £2,749. Deducting the price of the liquor, the profit is £1,013. The gross assessment is £210, the net £175, and the rates are £70; the poundage of 6d. on purchases is £36 9s. Now let me take a public-house where practically the same amount of money is taken for liquor—£2,631 3s. 7d. The cost of the liquor is £1,789 19s. 5d, therefore the profit is £841 4s. 2d.—less, it seems, than in the case of a club, probably because the price of the liquor is higher. The gross assessment is £455, the net £380, the rates £152, and the present Licence Duty £40—it is to be raised to £227 10s.; so that, with the same trade, the tax on the club is £36 9s. and on the public-house £227 10s. That is an instance to show how differently we treat the club and the public-house, where the same trade is done, I suppose with practically the same results, so far as drinking facilities are concerned. The compensation fund set up by the Act of 1904 was for the purpose of compensating houses which were closed through no fault of their own. Here you are closing thousands of houses for no fault of their own, but that very fund to which these houses have contributed their share will not be available to compensate the owners of those houses. They are to be shut down, and the owner is not to have a farthing out of the fund to which he has contributed. In fact, that illustrates the injustice of this method of doing what you tried to do last year. Last year you arranged for some compensation, although, as I believe, it was insufficient. This year you do what is practically the same thing, for I see no difference between closing houses by law and taxing them so heavily that they must close. The man who has to close will have no recourse to the compensation fund to which he has been contributing. It may be said, "Let them raise the price of the commodity." I doubt whether it can be raised, or sufficiently raised, by the retailers to the public. I understand that it is difficult to put an addition on the price of beer permanently, but I am not an expert on the point. If you do raise the price you lose customers, and to the extent you lose customers the result is about the same as if you did not raise the price. It may be said that the publican can resort to the brewer. I am not sure whether even the occupier of a tied house will be able to resort to the brewer. The clause in the Bill is very vague, and I confess I do not know what the effect of it will be, but I suppose we shall hear later on. It is pretty certain that he will not be able to recover the whole of the duty from the brewer. What about the man with a free house who has no one to fall back upon? He has no brewer behind him. There are many such cases now, and I say, without fear of contradiction, that for a man carrying on a free house this Bill will have an oppressive effect. Here you have a trader carrying on a trade which you may not like, but which after all is a legal trade. Hitherto we have been taxing him from £10 to £60 per year, according to the size of the house, and now we are going to tax him from £200 to £500. Is that fair to the man who has done his best to build up his trade and keep it together? Suddenly you tax that man for no fault of his own. I am talking now of the free house, which you have said you prefer to the tied house. You put this burden more severely on the free house than on the tied house. I would ask the hon. Gentleman who replies for the Government to deal with the case of the free house, and to show how he can defend the duties proposed under this Bill. I can only come to one conclusion, and that is that it is the intention by this indirect means to close a number of these houses. I am not going to requote what has been quoted already, but I should like to quote one phrase of the Prime Minister. He said in June this year:— The Chancellor of the Exchequer was perfectly justified in regard to his liquor and Licence Duties in considering whether the effect might not he to discourage the growth and. indeed, the existence of some of the worst class of houses. 9.0 P.M.

I suppose he meant by that some of the least profitable houses. The expression "to discourage existence" is a new Parliamentary paraphrase for cold-blooded murder. He moans, of course, to close the houses. That is one object of the Bill. Another object of the Bill was stated by the Parliamentary Secretary to the Treasury (Mr. J. A. Pease) in a speech at Saffron Walden on 4th December last. He said:— I imagine that people will expect that Mr. Lloyd-George will cause the abolition of the redundant licences by placing taxation on them so that the people may get back their own. I do not often use strong language, but I do think that to carry out that process without considering the effect upon the men you are hitting in order to attain what you believe no doubt to be public-ends at the cost of individuals, and without providing for those individuals any protection in the way of compensation, is mean treatment. It is treating the subject more meanly than has ever yet been proposed by any party in this House. I think you are justified in aiming at your public ends. So one will quarrel with you for that; but, in doing so, you ought to consider the effect on the individual traders. I feel very strongly that the effect of this proposal will be disaster and ruin to thousands of traders who do not deserve to be so treated. I do ask whoever replies later on to deal with this point, and say whether the Government have sufficiently considered the effect on the individual of the taxation they are now proposing.

It was not my intention at one time to intervene in this Debate, but I have had so many representations made to me, not only by my constituents in the Central Division of Glasgow, but also by people in other parts of Scotland, as to the disastrous effect of this Budget so far as the Licence Duties are concerned if they are persisted in, that I feel it right that I should put some of the information I have received before the Committee. I take the cases merely at random from a great many illustrations I have as to what the results of the Budget would be. I am not dealing with grocers' licences. The cases refer either to publicans or restaurant keepers, and I think I am well-informed and able to form a correct opinion as to the effect which the application of these duties must have upon the carrying on of their legitimate and high-class business. The change runs thus: Where under the existing laws £60 is paid for Licence Duty, it is to be increased to £290—that is nearly five times. In one other case a £40 licence is to be increased to £293. In another case £103 is to be increased to £1,137, and in that case I have been given the net profits of the business, which was an old well established, respectable business, and this licence Duty would swallow up far more than the whole profits of the concern. In another case £50 is to be increased to £500, in another case £38 is to be increased to £435, and the result of this Licence Duty would be to close the establishment. These are merely illustrations of a much larger number of similar cases of which I have received particulars. I cannot believe that it is proper finance that a Budget which would have that effect should be introduced and carried through. The only result would be to close the business altogether, and you will not only have no revenue from it, but you will increase very considerably the number of men and of women, too, who are not able to get employment. The figures which have been given either by the Chancellor of the Exchequer or by those who represent him, show that if the trade continues on anything like its present condition far more money will be received than the Government require, and if they only obtain the money which the Chancellor of the Exchequer says he hopes to get from it, it must inevitably be because there is to be an enormous reduction in the number of public-houses and restaurants. I do not pretend to be an expert in finance any more than in running a public-house or restaurant, but I have always understood from my reading that the true purpose which a Chancellor of the Exchequer sought in bringing in his Budget was so far as possible to get the most money out of the trade without damaging it. But here the result, and what is wanted, would undoubtedly be not to get revenue, but to close establishments where alcoholic liquors are sold. Unquestionably that is not the legitimate subject for a Finance Bill. It may be good enough for a Licensing Bill, but it is uncommonly bad finance to attempt to introduce into a Budget. From the figures I have given, if they are accurate—and I believe them to be so as I have got them from most trustworthy people—I say it is impossible to defend a Budget which will make such an enormous increase in these Licence Duties, and which can only have the effect of closing the establishments altogether.

I think this duty bears with tremendous severity upon Scotland, because the Chancellor of the Exchequer in his Budget statement in April last said his desire was that the three countries, England, Scotland, and Ireland, should be treated alike. But when he imposes the same rate of duty upon Scotland he does not take into account that the hours during which the establishments in which liquor is sold are allowed to be kept open are very much shorter in Scotland than those during which similar establishments in England are allowed to be kept open. Our restaurants can only be open from 8 to 10, and are generally not open so long, and our public-houses are only open from 8 to 10. I notice that the Government propose, if they can, to pass the Temperance (Scotland) Bill. If that Bill is passed there will be a further curtailment of two hours from the time in which a Scotch licence holder can keep his premises open. So that the Scotch licensee will be charged precisely the same duty as the English licensee, whose hours are so much longer that I think he is open about two days more in the week as compared with the Scotch licence holder. It seems to me to be an injustice to the licence holder in Scotland that for so much shorter time he should be charged exactly the same licence duty as the English licence holder. One word about the licensed grocer. There has been a good deal of talk about him. One point which undoubtedly causes a great deal of anxiety is what is the intention of the Government with regard to the sale in small quantities? It was stated yesterday by the hon. Member for Wexford (Mr. Ffrench) that a pledge had been given by the Chancellor of the Exchequer that the law so far as Ireland and Scotland were concerned should remain as it is now with regard to the quantity which could be sold. But I notice that the last revision—at least, I believe it is the last revision—of the Government upon the subject proposes a minimum quantity fixed at a half pint of wine or spirits in the grocers' licence. I do not know whether the Government mean to adhere to their new Amendment or whether they mean to carry out their pledge, because according to the information given me—I was not present at the deputation—the Chancellor of the Exchequer gave a distinct pledge to the Irish and Scotch grocers that there should be no qualification as to the smallness of the amount they can sell; and that is not consistent with the last Amendment which has been put down on the Paper by the Government. I think before we come to discuss the quantum of the grocers' licence we are entitled to know what is the position of the Government on that matter. But according to the general principle of this Budget, and according to the information given to me, the result unquestionably will be to kill out an enormous amount of public-houses and an enormous number of restaurants, and these not in the lowest classes but, on the contrary, in the higher, because the higher the class the higher the duty. The rent is high, and, therefore, the Licence Duty is high. But it may be, and generally is, that the proportion of liquor sold by them is very much smaller than is the case in the lower-rented premises. This duty presses unduly on Scotland, and presses so grievously on those classes to whom I have referred that it will drive them out of the trade altogether, and I certainly will not support any such proposal.

I should like to say in a few sentences why on this occasion I shall vote against the Government. Apart altogether from the question whether the Government are or are not taking too much from the liquor trade, which I do not discuss at all, I think most distinctly they are taking it in the wrong way. I have always been against the increase of the Licence Duties as a good Free Trader; I cannot understand how anybody on the Front Bench can hold that any part of this tax will ultimately escape being paid by the consumer. I believe that ultimately every penny of this tax will be paid by the consumer, but I also believe that in the process of transferring it from the dealer to the consumer a great many people will be ruined. I think it is indisputable that many houses will be shut up if this tax is passed in anything like its present form. Of course, men would consume liquor in a smaller number of houses, but in the meantime a great many very respectable traders who have invested their money in this business will be ruined. Some people on this side of the House have stated that the people are getting back their own. I do not think they are getting back their own in an honest way. These licence monopolies were given me years ago, and those who have got the money from them have walked away with it, and the people who now own them have paid for them like any other property. I think it is not honest that these men who bought and paid for this property should be deprived of it by what is called "getting back their own."

I am also opposed to the tax being paid as a duty on rentals. I believe it would be possible to raise money to the same amount in a far more equitable way. If you raise this money in the form of a tax on property, you are discouraging all sorts of building improvements, and you will stop any man trying to make his premises better or more attractive, because he knows that as soon as he does so his rent goes up and his Licence Duty goes up with it. A licensed grocer gave me a very instructive and interesting instance of how this tax will affect him. He told me that he had spent £3,000 in improving his premises, so that he might carry on his grocery business with more convenience and success. As a matter of fact, his trade in liquor has slightly decreased; but he added that if this Bill passes in anything like its present form he will have to pay £75 additional Licence Duty for having improved his property, though in the meantime his liquor trade has decreased. All over the country you will find anomalies of that kind. I know of another case, that of an hotel in Scotland, with a rental of £350. A very large part of that rent is due to the fact that there is a fishing place in the adjoining loch, but in a local public-house far more liquor is sold than is sold by this man in his hotel. I object to this tax being imposed in the form of a duty on rents. If it had been raised in the form of a tax on liquor, I do not think there would have been quite so much to say against it. As to whether or not this tax will be paid by the consumer, as a Free Trader I believe it will, and I believe the Government think so too. Then, why do they not put the duty on in a form in which it can be received more equitably than in this way? There is this additional argument, that you are raising the Licence Duty when sales are seriously decreasing. I do not know exactly what the figures are, but one can see from the Returns issued from time to time by the Chancellor of the Exchequer that the sales of liquor have seriously decreased within the past few months. In Scotland, I believe, they have decreased from 30 per cent, to 50 per cent. Yet you are asking for an additional Licence Duty to a very large amount—in Glasgow, I believe, for an additional £45,000. I am sorry to say that I shall have to vote against the Government.

Like the last speaker, I rather wish the Government could have collected this money from a different source. I appreciated the remarks of the Prime Minister this afternoon when he said that he considered the brewer would not pay. I quite agree; I am perfectly certain that ultimately the consumer will pay, though, in the interval, I am afraid, if this proposal stands as it is, that a very great deal of inconvenience, and more than inconvenience, will arise to the parties concerned. I do not at all take the view, which I understand is expressed by some hon. Members on this side, as to the suitability of these taxes for other reasons than finance. If I turn to the purely financial position, it appears to me that, merely referring to last evening and the dealings which took place in connection with Irish licences—to which I take no exception—we seem to get one or two points of agreement. First of all, we understand that the clubs, at any rate, are to be charged upon the bulk of business which they do. I am not debating whether the charge is a suitable one or otherwise. We understand, in the same way, that hotels in some form or other will have the charge regulated by the amount of alcoholic business which they do. Last evening there was a Debate on the question of London. The proposition before the Committee, as I understood the Amendment, was really to exclude London absolutely. Nevertheless, the position of London serves as a very important illustration to show the absolute disparity of valuation throughout the country. It appears to me that the Government should bear in mind that if they accept the principle of charging to some extent upon quantity, in the instances that I have already quoted, throughout the country enormous inequality must ensue. There were not sufficient details given last evening. Some two years ago it became necessary under an Act of Parliament to equalise the Water Rate for some parts in the Metropolitan districts outside London, and some parts inside London. Parliament decided that the whole charge, both inside and outside London, was to be upon what is known as the rateable value. In the case of one town, upon the annual value, the charge of the Water Board was £100 and the rateable was £80. In another instance the outside value was. £117, and the rateable annual value was £72. In the same way it goes right down, showing that the London valuation was distinctly higher inside London than outside. We hear a good deal about the Valuation Bill, and all of us would very much welcome a Valuation Bill, but it does appear to me that, knowing as we do the extreme disparity between the valuations, this is not a suitable moment to put enormous new charges upon these houses based upon figures which are, I think, by universal assent distinctly in need of very drastic improvement.

The hon. and learned Member for Kingston (Mr. Cave) mentioned free houses, about which there has been hardly anything said in this discussion. Last year we heard a good deal upon that subject and we were told that the policy was as far as possible to encourage the free houses. It so happens that I represent a town which has the largest proportion of those free houses in the United Kingdom, and what is the position of my people? Last year I asked and pleaded very hard for some extra consideration for them. It was not a matter of asking exactly for charity. The position was this, that more than half of them had little breweries, attached, and under the proposals half of them would have been got rid of, but they would not get any compensation for any- thing but the houses. That was the hard position last year; what is the position this year? The position this year is this, that as most of them are beer-houses they will go up from the present figure three pounds ten, and they will be rated and assessed not only upon the beer-houses, but upon the whole hereditament, so that a little brewery and the house will be put together, and they will come under this new scale, and will be called upon to pay a third of all that if the Bill passes in its present form. I go a step further, and I venture to suggest that when we come to Clause 32 and go into this question of how we are to give relief to the ordinary tenant and make the person who holds the tie over him give him the money back that it will be found to be absolutely unworkable. As regards these free houses, which are certainly deserving of encouragement, their position becomes simply intolerable, and there is no opportunity or chance for them. What is the outcome of all this? It appears, if we understand and accept the view expressed by the Prime Minister, that this is a Budget for finance purposes, and that it is intended the consumer shall pay. Surely upon these matters where there is all this difficulty, and where there is obviously a mixture of one scale with another, and I do not know how many scales throughout the country, it would be very much better to put the tax upon the liquor itself to get the amount required, and not on the licences that we are talking about. I cannot see myself how anything but inconvenience and great harm can arise unless something of that sort is done. I should like to say a word to some of the hon. Members who represent the brewing interest. They have told us that the scale of altered charges which is now proposed is a very great shame, but do they contend that the present scale is one they uphold? We have heard three times over about the Holborn Restaurant being rated at £60, and I want to know if the contention is that the present scale is one that is adhered to absolutely and rigidly by hon. Members opposite.

Nobody has so contended. We have all admitted the anomaly, and we have pointed out over and over again that it is a difficulty.

I am glad to get the admission that the scale as it exists to-day is an anomaly. Then it becomes a matter of degree to see in what way the scale ought to be altered. Obviously it is not fair to have these great big places in the City paying only a similar sum as the little places in the country with which I am more familiar. I express the hope that in some form or other the Government may see their way to reconsider their method of collecting this money from the source which, we understand, they have now decided to levy it on. I have no personal objection at all, and I think it is quite suitable that they should in some form or other get the money from this source, but the way in which they propose to get it will, I think, cause a good deal of unnecessary hardship.

The hon. Gentleman who has just addressed the Committee, and the hon. Baronet who preceded him, both pointed out with a great deal of force an argument which I venture to reinforce—the argument which points out the absurdity of taking the rateable value as the criterion for your tax at present. I take one single case, which I know very well myself. The case of a business premises carrying on a licensed trade in the centre of a busy locality. There are a great number of those premises in the city of Glasgow, and take the position the publican is in in one of those premises. He is not in the position of the ordinary seller of liquor because he has not got the class of trade to meet. His customers are what you may call, perhaps, a higher class of customer, clerks and business men employed in the various commercial houses. In order to meet their requirements he had to bear the upkeep of those premises, and a considerably higher rate of charges than the publican in the ordinary sense. He has to provide a better service, more waiters, and more attendance, and he very frequently provides a restaurant far in excess of the restaurant provision which is demanded, and, I think, rightly demanded, by the magistrates. In addition to those increases he has to deal with a trade which only occurs in comparatively short hours every day. After those business hours the value of that house is practically nothing, as the time for trade is gone. He has to pay the Licence Duty on the rateable value, and I cannot believe that the Government have thought what that means. I have here particulars of two cases of two different houses in the business quarter of Glasgow, the rateable value of one is £400 and of the other £500. The Licence Duty is, in the one case, £38 16s. 8d., and in the other case £42 3s. 4d. Now, how do you propose to treat those two houses? In the first case, the man, instead of paying £38 16s. 8d., is to be asked to pay £200, an increase of £180, or over 400 per cent, on his present duty.

In the case of the other premises, rented at £500, the duty being £43, the increase is to be £250, an addition of nearly 500 per cent. What can be the result of such treatment? Either the publican will be unable to meet the increased burden, and will cease to carry on—which will not benefit the revenue, and this is supposed to be a Finance Bill—or he will carry on his business under conditions much less good and less healthy than at present, because he will be unable to afford to carry on as he does now. If you force him to do that, you will do the greatest possible disservice for the cause of temperance reform.

It has been asserted time after time that this legislation is not vindictive. I ask any man in the House who is not a party man, or who will give calm, judicial consideration to what is going on, whether he can honestly say that this is not a vindictive proposal? Speaking as a Scot who is ashamed of the amount of drinking that goes on in Scotland, I say that the facts which have been adduced show that an injustice will be perpetrated. There exists among us a sense of fair play and justice, but we have a strong feeling in Scotland that these qualities are being violated just now, and that our character is going if the Government continues in its present course. As a Scot, I think every one of us would say that it is our desire to see less drinking in Scotland; but is this the way to bring it about? Is this a Finance Bill, or is it an attempt, under the guise of finance, to strangle a trade in the dark, and to crush out men who are honestly conducting an honest business? I have had men come to me personally making appeals, almost with tears in their eyes, because their business is to be crushed out, and pointing out that they are doing an honest trade in which there is nothing objectionable; that they are carrying on restaurants and doing a legitimate and necessary trade; but because some of their customers desire a little whisky or beer or stout with their food they and their customers are to be treated as criminals. That is the case as it appears to us. I sincerely trust that if the Government carry through this transaction they will very soon lose their places.

One point has been lost sight of by the Government and by every speaker I have heard. In dealing with the free houses the result under this valuation will be double taxation. I ask the Solicitor-General to deal with this case. Take a free house with a normal rent of £100, which the landlord lets to a leaseholder at £150; that is, the premises being licensed, he charges £50 more than he would let the house for to a grocer, a baker, or a draper. My point is that the landlord has already annexed a portion of the monopoly value.

Mark what follows. The normal rent is £100, and the monopoly rent which the landlord charges is £50. The valuation under Schedule A will be £150, and you are actually going to charge this man £75 duty. He will, therefore, be paying £75 to the Government and £50 extra to the landlord, or £125 extra for premises the normal value of which is £100. We dealt with this point on the Licensing Bill, where the monopoly value was to be the difference between the value of the premises as licensed premises and their value for any other purpose. Under theses circumstances the man will pay £100 normal, £50 monopoly, and £75 duty? It is monstrous? You cannot justify it. You may say that the landlord ought never to have got the £50; but there is the fact. The man has a lease, and he must pay the money. I daresay the £50 monopoly value which the landlord has got ought to go to the Government; if so, take it, but do not take it from the tenant.

Then there is another injustice. I supported the Licensing Bill last year right through; I supported local option for Scotland this year, and I would do it again. I would rather see local option right through the country, because I would prefer to trust to the local veto to see justice done than that rank injustice should be inflicted upon any man under a lease. What is the position of the leaseholder, taking the same case as before? You are going to say to him, "You are paying £50 to the landlord; we want another £75."But suppose he says, "I cannot do it; when I took the, lease the licence duty was and had been for many years £30 or £40. I can give him £150 and £40, but if I am asked to give him £150 rent plus £75, I cannot do it." A man may say, under the lease, "I am under full covenant to keep up the licence." Let me tell the Committee this is a very serious matter. A man cannot get rid of that lease. I know some people think otherwise, but I assure them it is not so. I know the practical working of these things. I have come upon thousands of cases where it is very difficult for the free men to make a living. In the City of London particularly, I could point out thousands of houses which have gone out of existence altogether. The trade is gone, and is still going in many of them. These are free-house men. Some people talk as though this is a question of brewers only. Nothing of the kind.

I assure the hon. Member it is not. Let me tell the hon. Member for Stoke this: So far from brewers buying, they have sold to free men. There is a case in my mind of Coombes, the brewers, who sold to a man in the City, and lost money over the house. How, I say, is this man to get rid of his possession? It is not only the case in this country, but largely in Scotland— so much so that a deputation came two days ago to put the point to the Chancellor of the Exchequer. Well, if you put upon us this heavy duty, we cannot help it; but will you help us to get rid of the obligation to keep on our lease as a licensed house? I do not see how you are going to help us. Therefore, I wish the Government to deal with this point. I contend, and I challenge any man to prove the contrary, that there is a double duty here in the case of the free house. There is the annual rent and the rent of the licence, and they are both marshalled together and aggregated for the purpose of the duty. This duty is to be 50 per cent., not on the nominal rent, but on the nominal rent plus the other rent. I say it is very hard upon these men, and also very hard upon those who are under a covenant to keep up the licence, no matter what they are losing. I say these are cases which require the very closest and most careful consideration. Whatever may be the case of houses held by the brewers, the brewers may be rich enough to keep them on; but as to the poor unfortunate lessee of some of these houses, I feel very certain the large proportion of them will not be able to afford to pay this double duty.

I have listened very carefully to this Debate, and shall, in a very few words indeed—for I cannot pretend to be an expert upon it— summarise some of the conclusions which seem to me to inevitably come out of it. We have had only three speakers from the Ministerial side, and of the three the last speaker, in an able speech, no less than the Member for Kidderminster (Mr. Barnard) and the hon. Member opposite spoke with great force. I desire to emphasise what was said by the last speaker, that this is not a brewers' question. Many brewers are involved in it. I look at it from the point of view of what it is largely, a question of the free-house holder. Yon are bound to look at the case of men, many of whom have invested their savings in a free house. Figures have been given—and they have not been contested—by my hon. Friend beside me, and by the hon. Member for Lanarkshire and by the hon. Member for Kidderminster. I do not take the language which we have heard described by the Prime Minister as "picturesque and variegated language" in relation to this matter. I take his own language of responsibility and soberness. What does he say? He says he has desired to discourage the growth, and, indeed, the existence, of certain houses. "Discourage the existence" means, of course, to put down as expeditiously and decently as the right hon. Gentleman finds it in his power to do. What I wish the Committee to realise is that this project is being put forward in the Finance Bill following a rejected Licensing Bill of last year, and in the state of circumstances in which the law of 1904 definitely recognised and definitely provided for the existence of these public-houses whose tenants conducted them with propriety, or if they were discontinued for public ends gave them definite compensation. What I wish to bring before the Government and impress upon them in the strongest possible way is that we have an original state of things in 1904, where compensation is provided from the trade themselves to indemnify the licence holder, who, for the public interest is deprived of his licence. We have that state of things followed by attempted legislation on the part of the present Government, which definitely, though as we think very inadequately, recognises the holding of these licences by giving first a 14 years' time limit and afterwards, as freely expressed as possible, even a 21 years' time limit to those in possession of these licences. Men whom both this Government and the last recognised as having a position, are to be taxed out of existence, are to be absolutely ruined. In the first place, that is a proceeding which cannot be justified as a proceeding in a Finance Act, which is legiti- mate in a Finance Act, at all; a proceeding which is absolutely contrary to policy and justice, and a proceeding which is, after all, improper as finding its place in a Finance Bill when, in reality, it is nothing but a proceeding—I do not wish to use strong words—but I must call it a vindictive proceeding—without compensation to those to be taxed out of existence, though you yourselves recognise in your own Licensing Bill that they were entitled, at any rate, to some measure of compensation. If this is to be a definite and determined thing, as announced by the Prime Minister himself, may I in a very few sentences call the attention of the Committee to some few other circumstances which make this proposal even worse? The Member for Kidderminster gave himself conclusive reasons, from his own experience as the chairman of the Water Board of London, as to the uncertainty of the basis of assessment which you have chosen. I trust that the right hon. Gentleman who is going to reply on behalf of the Government will deal with this definite fact, which came under the notice of one of his own supporters in his official capacity, and which shows that the basis on which the Government are proceeding is an unsafe one, an unequal, and therefore an unjust one. There is the further circumstance that you are imposing these ruinous duties which must ruin many individuals who were encouraged in former times to carry on the liquor trade, and you are doing that at the time when the cause of temperance, as measured by the consumption of alcohol, is progressing, and you are imposing this taxation upon what has been often said to be a decadent trade. You are therefore not merely failing to get the revenue which you alone say is the justification for this tax, but in failing to get that revenue you are imposing widespread ruin upon many deserving cases.

The right hon. Gentleman who has just sat down began his speech by pointing out that on this side of the House there have been so far in this Debate only three speakers, and all of them spoke in order to criticise in a greater or less degree the proposals of the Government. As he is an old Parliamentarian he will be aware that it must not be assumed that because hon. Members upon this side of the House do not speak in support of the proposals of the Government that therefore the proposals of the Government are not supported from this side. Hon. Members are well aware that under the conditions in which Parliamentary proceedings are carried on they may assist the proposals of the Government as much by silence as by their speeches, and being as they are in entire agreement with the proposals of the Government, they are content sometimes to leave the defence of them to hon. Members who speak from the Front Bench. The right hon. Gentleman based his main objection to this Clause upon the ground that the proposals it contained were not in spirit and intention financial proposals at all. That is the gravamen of the charge raised against Part II. of this Bill in the speeches of light hon. and hon. Gentlemen opposite, not-only to-day, but in the country besides. Well, the retail licence part of the Licence Duties, excluding the yield of the manufacturers' duties, which we have already discussed this afternoon, after the concessions which are being made by the Chancellor of the Exchequer, are still expected to bring in revenue amounting to £1,600,000.

Yes. The equilibrium of this Budget depends upon this sum being raised, and it is an integral part of the financial scheme of the year. Of course any taxation imposed upon any trade must have effects upon that trade as a business; that is a commonplace of financial discussion. I daresay that a tax upon milk would bring in a larger revenue than a tax upon whisky, but no legislator would propose to impose a tax upon milk.

Simply because we do not regard, and neither party ever has regarded, the amount of the revenue that would be raised without also necessarily having to consider—it is one of the first principles of all statesmanship—the direct effects of imposing any duty upon this commodity or upon that. Indeed, it is very strange that hon. Members opposite should now advance arguments that in making fiscal proposals you must only have regard to the amount of revenue which is to be brought in. The right hon. Gentleman the Leader of the Opposition, if not himself a Tariff Reformer, is at least the leader of a Tariff Reform party, and they propose an entirely new scale of fiscal duties, not merely in order to bring in revenue but to unite an Empire on the point of dissolution, to secure general employment for the working classes, to cause agriculture again to flourish, and to effect a number of indirect results from the taxation they propose. And mark this, that this scheme the more effective it is the less revenue it will bring in. But if this liquor tax, even in a very small degree, should promote the cause of temperance, then, forsooth, it is to have no place in the Finance Bill. We do not for a moment seek to deny that all taxation does have social effects as well as fiscal effects, but it may be none the less part of financial legislation. Take the case which is attempted to be made out to-day with regard to the scale of duties proposed in the Schedule which is attached to this Clause. Hon. Members have quoted a large number of specific instances in which duties which are at present low would be multiplied three and four times under the scale in this proposal. Some they say will be multiplied even more than that—perhaps ten times. It is perfectly true that may be the result of our proposal, but one of two conclusions can be drawn from that fact. One is that our new duties are too high; the other is that the old duties are too low. Take, for example, the duty upon the beer-houses. A beer-house let, say, at £100 annual rateable value, pays at present the duty of £3 10s. It may be doing an exceedingly large trade; a house of that character in a working-class district may have an annual turnover of many hundreds, possibly even thousands of pounds. We propose that that house should pay a tax of £33 10s. per year, that is to multiply the present duty tenfold. It may be said that is a very large multiplication, but it has yet to be proved that the present duty of £3 10s. is a reasonable duty. It has to be proved that a taxation of £33 10s. is excessive for a house of that character. It is admitted that the present scale is full of anomalies. I do not say—and I shall return to this subject again—that the annual gross value of a licensed house is in all cases an absolute indication of the value of the trade that is done, but in the main, as a general principle, you do find on the average that the large house is doing considerably more trade than the small house. Now what is the present scale, as established in 1880, taking the percentages of the annual value? A house assessed at £10 a year now pays a duty of £4 10s., which is 45 per cent. of its annual value. I will not go through every item, but I will take the mean figures. A public- house with an annual value of £17 10s. pays a duty of £8, or 45.7 per cent. A public-house with an annual value of £27 10s. pays a duty of £14, or 50.9 per cent. of its annual value. Such a public-house pays 50 per cent. now, and has been doing so for the last 30 years without demur on a house of that valuation. When you come to annual value of £45, the duty is £20, or 44.4 per cent. From that point the scale rapidly descends. Houses at £150 pay 20 per cent. of the annual value; £250 pays 14 per cent.; £450 annual value pays 10 per cent.; a house with an annual value of £650 pays 8.5 per cent., and a house with an annual value of £1,000 only pays 6 per cent. Can you justify a system of taxation which on the smaller houses up to £50 annual value charges 50 per cent. but when you come to houses with an annual value of £1,000 only charges 6 per cent? Take again the case of beer-houses. Some of these do a very large trade, and bring in large revenues to the owners. Under the Act of 1904 it has been found that there were many cases of beerhouses which received compensation of £2,000, £3,000 and sometimes £4,000 is being paid now for houses of that kind, and yet all these houses pay to the State at the present time a fixed Licence Duty of only £3 10s., and no more. Take the hotels. Great hotels like the Carlton, doing an immense trade in the sale of alcoholic liquors now pay the ludicrous sum of £20 per annum. The Hotel Metropole pays £20 a year, and even where they have a bar, as I believe they have at the Hotel Cecil and come under 4;he public-house licence scale they only pay £60 a year towards the revenue. [An HON. MEMBER: "What will they pay under this Bill?"] I shall come to that presently. I am now referring only to the present scale. The hon. Member for Ayr Burghs has frankly admitted that the present scale is indefensible.

If the hon. Member is prepared to defend a scale that contains many anomalies, then his attitude to-day is very different from what it has been in past Debates. It is admitted not only by the hon. Member for Ayr Burghs, but by active leaders of the party to which he belongs, that some reform of this scale is needed. In moving the rejection of the Licensing Bill in another place; Lord Lansdowne said he was very far from contending that the last word had been spoken in respect of the relations between the State and the liquor trade. "With regard to the acceleration of a reduction of licences, in places where it can be shown that acceleration has not been sufficiently rapid, further legislation may be necessary. It has always seemed to me," he said, "that there is a great deal to be said in regard to the incidence of the taxation which at present falls on licensed property." A previous Chancellor of the Exchequer, Sir Michael Hicks Beach, used language of a much stronger and more definite character. Speaking some time ago with his usual courage to a meeting of the Licensed Victuallers Association in West Gloucestershire, he used these words: "A public-house rated at a little under £100 would only have to pay £25, and it increased £5 for every £100 rateable value, and when they got to £700 the increase stopped altogether, and the public-house might be worth thousands a year, as some of them were aware, and yet it paid no more than £60 a year in Licence Duty, whilst the little house with a rental of £10 a year annual value paid £4 10s. He did not think that was fair, but there was something else which was still less fair. They knew that the great hotels and the great theatres and music halls had no more than £20 a year to pay to their Licence Duty, notwithstanding the enormous rent and the enormous amount of liquor consumed in them. The present scale of licences is utterly unfair on the smaller houses as compared with the bigger houses, and I think the bigger houses might very well bear additional taxation. "It is therefore admitted that there is a case for a reform in the present scale of Licence Duties. But it is now suggested that this scheme has occurred to the Government for the first time apparently as a consequence of the rejection of the Licensing Bill last year, and being anxious to revenge themselves upon a trade which had secured the rejection of one of their most important measures, and being unable to attack it in one direction, they adopt a vindictive scheme of revenge in another. [An HON. MEMBER: "They have said so."] All who are acquainted with the financial policy advocated by the leaders of the party to which I have the honour to belong, are aware that for years past an increase in the scale of Licence Duties has been an integral part of the financial proposals made by Liberal leaders, and whenever these matters have been discussed they have formed one of the proposals to increase the revenue. I came across a quotation the other day from the late Sir H. Campbell-Banner-man's speech when he was Leader of the Opposition. Speaking on 24th June, 1901, after Sir Michael Hicks Beach, the then Chancellor of the Exchequer had taunted him for having opposed the duty on sugar without proposing an alternative, he said, "I think something might be done to lay hands on a large part of the increase in the value of licensed houses; that itself is a source which would furnish a great amount of these taxes." Sir Michael Hicks Beach followed, and admitted the scale was anomalous, and said there was a case for reform. That is the declaration of the then Leader of the Liberal party, that an excellent means of raising revenue would be to increase the Licence Duties on public-houses. I venture to say deliberately that if there had been no Licensing Bill ever introduced the Chancellor of the Exchequer of the present Government, anxious, and, indeed, forced, to look about for sources of fresh revenue, would undoubtedly have looked to an increase in the Licence Duties as a further source of supply to the Exchequer. It is true these proposals have some relation to the Licensing Bill, and that speeches have been made to that effect; but the facts of the case are these: We recognised that in proposing to reassume for the State the whole of the monopoly value of all the public-houses in the country after a certain time, and to impose additional restrictions in many directions upon the licensed trade last year, we were estopped from any considerable increase in the Licence Duties for purposes of revenue; but that if that Bill were rejected and that scheme failed, then we should be free to impose those increased Licensed Duties which would have been imposed in any case had that Bill never seen the light.

Then, the right hon. Gentleman, and those who spoke before him say, however that may be, the scale of duties in its application is too stringent and imposes injustice and intolerable hardship. We agree that certain cases may be quoted in which the charge for Licence Duties of half of the annual assessable value may impose a tax beyond what the trade done in the house can really bear. The hon. Member opposite has said in many cases the assessable value is not a fair basis of taxation. A publican may set out to do a certain amount of restaurant business, and devote part of his premises to that purpose. He has, in consequence, to have a larger building than the mere publican, and will have a larger assessable value, but not a larger liquor trade. We, therefore, proposed from the outset that these Licence Duties shall be imposed upon the large houses, if they so wish, this year and onwards, not upon the assessable value at all, but upon the compensation value—the difference between the value of the house licensed and the value of the house unlicensed. The hon. Member for Kingston (Mr. Cave) said the effect of that would be that in many cases there would be no concession at all. The tax on a third of the monopoly value may be as high, or even higher, than if you take a half of the assessable value. That is undoubtedly so in certain cases, but we do not contend it is a concession in every case. If a house is a great gin palace, doing an enormous trade and reaping immense profit, it may indeed pay more on a monopoly basis than on the rateable basis; but we do contend our proposal will precisely meet these very cases where a moderate trade is done in a highly rated building. That will meet the case of the hon. Member for Inverness.

We shall come to the details. It is intended to apply the provisions to Scotland.

And to Ire land; in the case of houses compensated under the Act of 1904—

As the present valuation, and in place of the valuation proposed to be applied this year for the whole of the houses in the country under Clause 30, Sub-section (1). My point was in relation to the very important concrete case put by the hon. Member for Inverness. He said that a man having a house and no prospects of an increased trade might propose to improve his premises, but he would be discouraged doing so; in fact, improve- ments of this sort would be penalised. But hen once you charge upon compensation value instead of rateable value you will deal completely with that class of case, and no man will be penalised in respect of improvements he proposes to make. The hon. Member for Finsbury (Mr. Bemnant) raised the case of the Holborn Restaurant, which he asserted would under the scheme have to pay an annual Licence Duty of £4,000. I cannot conceive that that figure is correct; if so, it is a special case, which would not come under the general provisions of the Bill relating to restaurants. Restaurants are charged a very moderate duty if they can show that less than one-third of their receipts are derived from the sale of liquor. I imagine that the Holborn Restaurant may be one of those cases where apparently over 33 per cent. Are liquor receipts, and therefore it is to be rated on the same basis as a public-house. But the Government have no desire in a case such as that to exact any duty approaching that for that which is in the nature of a genuine restaurant business. The right hon. Gentleman the Member for Central Glasgow (Mr. Scott Dickson) said the scale was specially unjust in relation to Scotland, because the hours of sale in Scotland are less than those which obtain in England. Yes, but if facilities for trade in any given premises are less than in other premises, it must be reflected in the assessable value, in the annual value, and in the compensation value. If the house in Scotland did business only during four-fifths of the hours that a house in England did, its rateable and monopoly value would be lower. The scale of duties would be the same, it is true, but it would not be applied to the same extent, and the house doing business for the shorter hours would pay less than the other. I admit I cannot appreciate the force of the argument of the hon. Member for Kidderminster as to free houses as against tied houses. There is no distinction at all, and I cannot see that this Bill, so far as the scale of Licence Duty is concerned—

My point was that in the case of the "tied" houses Clause 30 makes some pretence of getting the money back in the case of the "tied" person, but the free man would not able to do so.

That is so, but the duty extracted from that place of business, from those who profit by the trade carried on in that business is precisely the same.

In the one case, the "tied" house, the duty is extracted from the owner of the house, but from the free house the whole duty on the normal rent, plus the monopoly rent paid to the landlord, is extracted from the tenant.

Whoever gets the profits of carrying on those particular premises is, under our scheme, charged with the Licence Duty.

A man may make his arrangements with his landlord, and the Government cannot go behind them. If premises are worth £150 a year, it is estimated on the scale on which we are proceeding that a house of that character can afford to pay £75. It now pays a duty of £30, so in any case the increase is not so overwhelming that it cannot be made good from the extra profits on the spirits, and from other sources which may be at the disposal of the man who carries on his business there. So much for that particular case. Another argument advanced by the right hon. Gentleman who has just spoken is that in any case trade is not in a position to bear the increased tax, and we have heard that point raised in various manners by various speakers in the course of the Debate today. This is not the moment, it is said, when the consumption per head of the population is decreasing, to come upon the liquor trade for more money for the revenue. And the hon. Member for Sheffield (Mr. S. Roberts) raised the additional argument that the State recently has required public-houses to pay a compensation levy amounting to over a million a year, so that less than ever is it in a position to pay increased taxation. I advance the proposition, however, that the compensation levy is not to be regarded, in any sense, as taxation. It is the price of the insecurity of the licence, which existed before the passage of the Act of 1904. It is a substitute for the payments which had to be made by all prudent owners of licensed houses, either in the form of insurance or in the form of payment to reserve funds to insure against the risks to which they were exposed by the insecurity of their licences. Further, the effect of this compensation levy has been to reduce, in our opinion, not to an adequate extent, but to an appreciable extent, the number of public-houses in the country. The effect of that has been to lessen competition for the houses which remain, and, so far, they are in a better trade position then they were hitherto. For these reasons this compensation levy, imposed by the right hon. Gentleman opposite, on the liquor trade, should not be taken into account in any degree in regard to the duty which the State may levy upon this industry.

With regard to the point that the consumption of liquor has fallen and that no increased taxation should be levied, it is a matter of very great importance. It is true that there has been a considerable decline in the consumption per head of the population; it is true that there has been a considerable decline in consumption, especially in the last ten years, but I submit, in the first place, that it is not right to compare merely the present day with ten years ago, when we were at the top of the curve of consumption. If you compare the present consumption with 20 or 30 years ago you will find that there has been practically no diminution at all. Secondly, I submit that in this matter you have not to consider the consumption per head of the population alone, although if indeed the number of public-houses had increased in proportion to the population, then you would be right in saying that consumption per head is the right basis. But as we all know, the sources of supply have been stationary or declining, and therefore the consumption per head of the population has no relevance to the discussion at all. You must take the total consumption throughout the country, and view that in relation to the number of sources of supply. Taking the total consumption in 1888, the consumption of spirits was 34,000,000 gallons, in 1898 it was 41,000,000, and in 1908 it was 38,000,000. The consumption of beer was 27,000,000 20 years ago, 35,000,000 ten years ago, and 32,000,000 last year. But the number of licensed premises on and off was 164,000 in 1888, 168,000 in 1898, and 162,000 in 1908. So that if you take the consumption of liquors per licensed house you find, taking both on and off, that it was in 1888, spirits 323; 1898, 385; 1908, 357, and beer, 184 barrels, 234 barrels, and 224 barrels respectively. So it will be seen that comparing the present time with 20 years ago there has been an increase, and comparing the present time with ten years ago there has been only a slight diminution. There has, of course, been some increase of household consumption which it is impossible to estimate statistically.

With regard to clubs, which again have played such an important part in this controversy, there has been undoubtedly an increase in the number of clubs. But thousands of these clubs which appear in the statistics as clubs which supply liquor, and therefore come within the purview of the Act of 1902, are not ordinary working men's clubs or better class clubs at all. They are Freemason's lodges, golf clubs, or canteens, and other sources of supply of alcoholic liquor which technically, and for the purposes of the law, are clubs, but which to a very slight degree compete with the public-house. Let us see what the increase in the number of clubs has been. A very useful return is published annually by the London County Council of the number of licensed premises, and there is a table which shows the decrease in the number of on licences, and the increase or decrease in the number of clubs since the Licensing Act of 1904 came into operation. It is a familiar argument that since that Act public-houses have been suppressed, and in their place drinking clubs have sprung up, and that consequently the position of the publican, so far from being bettered by lessened competition, is worse than it was before on account of this new competition. There are certain districts in the country where there is much truth in that argument, and where the number of working-class clubs has very considerably increased of late. But, taking the country as a whole, that is not so. Take London. In London, during the last four years, the total number of public-houses which have disappeared from all causes is 525. The increase in the number of clubs is 30. So that London publicans have been relieved of the competition of 525 public-houses, and, as against that, they have the increased competition possibly of 30 clubs, many of which are not ordinary drinking clubs or clubs in which large quantities of liquor are consumed, but those institutions which are technically called clubs.

In other large towns the figures are: Public Houses. Clubs. Decrease. Increase. Decrease. Birmingham 149 3 — Bradford 32 2 — Leeds 69 — 3 Liverpool 185 5 — Manchester 280 1 — Sheffield 118 — 2 It may be said that, although the number counted in units of the clubs may show no large increase, if you take into account the increase of membership, it may be very striking. I inquired from the Club and Institute Union, which comprises some 1,184 ordinary workmen's clubs, with a membership of 350,000. I have been supplied with the figures of the membership for the last few years. The Club and Institute Union is one of the largest institutions of the kind. The largest is the National Union of Conservative Working Men's Clubs. The average membership of the clubs connected with the Club and Institute Union was in 1902, 284; 1903, 291; 1904, 280; 1905, 287; 1906, 292; and 1907, 296. I have not got the figures for last year. It will be plain to the Committee that if you take into account membership the average membership of 1,184 workmen's clubs has been almost steady during these six years. Therefore that argument falls to the ground. I think I have now dealt with all the different points which have been raised by hon. and right hon. Gentlemen in the Debate, and on a review of the whole circumstances we appeal with confidence to the Committee to reject the Amendment.

The right. hon. Gentleman concluded his speech with the self-congratulatory remark that he had dealt with all the objections raised against the tax now under discussion. It is perfectly true that he referred to a good many of these objections, and that he gave us a great deal of interesting and useful information which had no relation whatever to these objections, and the relevance of which to the defence of the Clause seemed to me to be at the best very shadowy. I will not attempt to deal with the whole of the speech of the right hon. Gentleman. I will only deal with the central difficulty of the Government position with which the right hon. Gentleman has not, in my judgment, at all events, dealt at all. He has not endeavoured even to answer the arguments brought against the proposal from this side of the House. I may preface what I regard as the central difficulty of the Government situation by saying something that has got to do not with the actual proposals in the Budget taken by themselves, but with the proposals taken in relation to the general Government policy. The right hon. Gentleman was extraordinarily courageous to suggest that there is nothing in these proposals which has any relation to the Licensing Bill of unhappy memory which was rejected last year. How can the right hon. Gentleman, in the face of statements by right hon. Gentlemen on the Treasury Bench, make any assertion of that kind? He and all the most important of his colleagues have gone about—they were perfectly justified in doing it—saying that the House of Lords rejected it. Nobody will object to them denouncing the House of Lords. They were not content with that most legitimate exercise of their rhetorical gifts; they went the length of saying that as the House of Lords had rejected the Licensing Bill, they were able and they intended to replace the Licensing Bill by something which the licensed trade would object to at least as much. Does the right hon. Gentleman think that I am inaccurately representing the speeches of himself and his colleagues? Surely he does not. Everybody knows that in that brief and concise compression of the speeches which have occupied hours on the platform I have not misrepresented in the least the statements made, not by the irresponsible Gentlemen sitting below the Gangway on both sides of the House, but by Ministers, the Ministers who were responsible for the abortive Licensing Bill and the Ministers who are responsible for the proposals now before us. The right hon. Gentleman comes down and tells us, as he did just now, that he had given great thought to the subject, and that he spoke with all responsibility an was confident, after grave reflection, that even if there had never been a Licensing Bill, there would have been something like these Clauses. Many of us can write imaginary history. Many of us can say what would have happened if something else had not happened. The only drawback is that there is no way of putting it to the test of proof, and, though the natural instincts of hon. Gentlemen on that Bench might have led them to make some proposals on this subject, yet it is on record that they boasted that they could, and would, substitute for the Licensing Bill other proposals, to which the trade would object at least as much.

Hon. Gentlemen are candid enough to cheer. Very well then, we are all agreed. But do not let them applaud the argument of the right hon. Gentleman who has just sat down, who really tried to induce us to believe that there was nothing in this proposal of the Government which had anything in relation to the Licensing Bill of the Government of last year. Their own cheers show what they think of that statement. It is hardly fit for consumption either in this House or on the platform or anywhere else. It has more to do with the political concomitants of this proposal than with the actual merits of the proposal itself. I will leave the first point and come to the second, on which I am bound to say the right hon. Gentleman gave us very little satisfaction. He spent most of his time in attacking the late Mr. Gladstone. He said the scale of duties which Mr. Gladstone proposed in 1880 was anomalous and unjust, and nobody now defended it. I remember Mr. Gladstone's Budget of 1880, I was then, as I am now, a member of a relatively small minority of the House, and that Budget was passed by a majority which was not as large as that of the present Government, and was composed at the time of hon. Gentlemen of the way of thinking of the Minister who has just sat down. It is not any particular business of mine to say that Mr. Gladstone was, after all, not quite so wrong as his immediate successors appear to think, and that the scale of licences proposed by the Radical Government in 1880 was not, after all, quite so stupid as the present Government appears to think. But I leave that, and I am bound to say that they carry out their trust in the very oddest way. If Mr. Gladstone's proposals in 1880 were as absurd as the right hon. Gentleman says, let them settle that with those who are the inheritors of Mr. Gladstone's colleagues. Let us grant that Mr. Gladstone was as wrong as the present Radicals think. I do grant it. Let us grant that the scale established by Mr. Gladstone was an anomalous scale. There is no use in considering that unless it is shown that the new scale you are establishing is a better one. What do you mean by that? What ought you to mean by that? Not a scale, I presume, which, arithmetically considered, is more nicely adjusted to certain percentages arbitrarily chosen. What we want is a scale which shall press equitably on the people to whom it applies. What we want is, if you are throwing this immense taxation on a small and limited class, at all events that the scale shall be properly adjusted as between the members of that class. That is the first thing. The right hon. Gentleman has not said a single word to show that his scale is better than the old scale. They have already altered the Bill, and they have vaguely foreshadowed other changes. I do not know what has brought the necessity for those changes home to them, because, when I asked the Prime Minister, just before we separated 10 days ago, if there were any changes, he indicated quite clearly that as far as the Government knew there were no changes. For some reason or other they have thought "better of that decision since then. Now we understand that there are to be certain changes, very vaguely adumbrated, about Ireland. Now we learn that some changes are to be given to Scotland. Why was Scotland never thought of before?

Are we to understand that the Bill, with the Government Amendments on the Paper, represent, so far as the Government know, everything they mean to do in regard to Scotland? Is that what we are to understand?

I cannot say that there will be no Amendments. It is obviously impossible that I can say, and the right hon. Gentleman would not expect me to say that no Amendment will be put down on any part of the Licence Duties, large or small, which will touch Scotland. So far as the scale is concerned, so far as assessment of the duty on compensation value in the future is concerned, the Government, as at present advised, have no Amendments in mind, and I have adumbrated no Amendments.

I think what the right hon. Gentleman says is perfectly reasonable. What he says is that he cannot pledge himself in the face of debate and discussion not to make new Amendments in the Bill. He would be extraordinarily foolish if he did say so, considering the result which debate and discussion have already had upon the policy of the Government. I do not think those who have shown themselves to be wax are going suddenly to turn into adamant. Therefore I quite contemplate we shall be able to produce very great changes in the Bill. All I asked was whether the Government at the present moment contemplate any changes. They do not; they think Scotland is justly treated and that Ireland is not justly treated. That is their view. As far as they know at present they are convinced by the Irish arguments or the Irish votes. They are not convinced by either the London votes or the London arguments, or the Scottish votes or the Scottish arguments. The London arguments are not accompanied by London votes, and the Scottish arguments are not accompanied by Scottish votes. If my Scottish friends had the power of organisation possessed by Irishmen they might have a very different answer from that which was given across the floor by the right hon. Gentleman to me. As I am on the point of Scotland, let me deal with one subsidiary point of the right hon. Gentleman's speech. My right hon. and learned Friend (Mr. Scott Dickson) said that the Scotch hours were shorter than the English hours, and therefore they should not be treated in the same way. What was the right hon. Gentleman's answer? His answer was that the shortening of the hours in Scotch licensed premises will be reflected—I think that was the phrase—in the licence valuation of Scotch licensed premises, and therefore, as the premises will be of less value, they will pay a smaller tax, and by the small hours will thereby benefit. That is not the way the Legisture has hitherto dealt with that question of hours. If the right hon. Gentleman will look into the previous Acts he will see that where a licence was for six days and not seven a seventh part of the value of the licence was substracted from the value of the licence, so as to deal equitably as between the men who had held a seven-day licence and those who held a six-day licence. Therefore the Government are deliberately throwing over that principle already embodied in our Statute Law, and are introducing a wholly new principle, grossly unjust, as I conceive, to the Scottish holders of licences. I do not mean to discuss the special Scottish aspect of the question, nor the Irish aspect. The Scottish aspect still remains to be discussed, and the Irish gentlemen have already shown themselves perfectly competent to manage their own affairs in the British House of Commons—[Mr. JOYCE: "Or, better still, at home"]—by the most approved Parliamentary methods.

I therefore deal, if I may, in the few words I have still to say, with the general aspect, and especially the English aspect, of this question. I want to know—and I suggest to the Government that the only defence relevant to the present issue is— whether the new taxation you are going to put on is, in the first place, fair to the people you are going to tax, taken as a body; and, secondly, whether it is fair as between the individuals composing it? I say that this will stand examination under neither head. It is not fair as between different individual licence-holders; it is not fair as between licence-holders and other citizens. I need not argue the question as between different licence-holders; the Government have made no defence on that point. They admitted last night that the valuation was on a Wholly different principle in London and Scotland from what it was in the rest of the kingdom, therefore you are going to tax the London and Scottish licence-holder on a different scale from that applied to the rest of the country. How on earth are you going to justify that? You have never justified it. The right hon. Gentleman (Mr. H. Samuel) in his long and interesting speech to-night did not touch on that question. There remains that gross inequality. Then you come to the other inequality which has been mentioned by several speakers—the gross inequality of dealing with premises of very great value under the Bill either as it now stands or as it is proposed to be amended. The hon. Member for Huddersfield (Mr. Sherwell) has himself admitted that it was absurd to deal with licensed premises of very great annual value on the same principle as smaller licensed houses. There has been no adequate concession on that point, and I do not believe that in that regard the proposals of the Government are defensible. One of the points is that a great many other things are done in some of these premises than the mere sale of liquor. The Government make every sort of concession in regard to mixed trading in Ireland, but they regard it as a thing not to be taken into account in England. The first thing the Committee ought to do is to see that the scale of licences, for having made which unequal Mr. Gladstone is attacked, is in the new taxation made equal. It is incomparably more important that it should be made equal as between the different members of the trade under the new system than under the old. When your taxes are small slight irregularities may be matter of discussion, but they are not of any very great practical importance. But when you come to such gigantic amounts as are proposed to be put on under this Bill—doubling, trebling, multiplying by 10 or even more the taxation of a particular trade—every anomaly becomes a grievance, every anomaly produces really disastrous injustices; and it behoves this Committee and the Government to spend infinitely more trouble than they have apparently yet spent in trying to introduce something like fairness and equality as between the different members of the trade affected. I do not think anybody will pretend that the trade is equally treated as within itself.

11.0 P.M.

The last question is, How is the trade being treated as compared with the rest of the community? It is perfectly monstrous that, under the name of taxation, you should deliberately extinguish, drive out of existence, a very large number of those who are carrying on what is admitted to be a legitimate trade. I do not believe that the Government themselves deny that they will drive out of existence a very large number of these houses. I remember hearing a phrase from the Prime Minister about this taxation consolidating the business of selling alcoholic liquor in larger premises. He talked of discouraging the existence of the small houses. That is a polite way of saying that he proposes to drive them out of existence without compensation. I do not think that is a legitimate use to which to put taxation. I do not think it is a legitimate end to accept when taxation is proposed. I think it iniquitous on the face of it, and it is doubly iniquitous if you consider the circumstances under which it is done. My right hon. Friend near me pointed out that you are going to extinguish houses without compensation which have been paying, what the right hon. Gentleman truly observed, was a large insurance fund for many years. How can anybody with an elementary sense of justice think that right? It is like compelling a man who has insured his life to commit suicide so that he may forfeit the insurance! How can you justify it? Here are these public-houses, let us say, in London, assessed up to their full value, which have suddenly thrown upon them a new, unexpected, and, I venture to say, a wholly unjustifiable burden. You admit the result of that burden will be to drive many of them out of existence. You may say, if you like, that the trade as a whole, whatever they may be, will be able to bear the new burdens which are put upon them. Let us grant, for the sake of argument—I was certainly not going to grant it as a matter of substance and fact — that the trade, as a whole, is able to bear those burdens. There are an enormous number of legitimate traders in that trade who will not be able to bear that burden, who will not simply be impoverished by your tax, but destroyed. Their whole means of livelihood will be gone, and gone without com- pensation, and without hope, and you do that on the ground that the fiscal necessities of the country require this iniquitous treatment of the small houses. If the right hon. Gentleman, instead of giving us all these statistics—very valuable and important statistics—had gone to the root and heart of the matter, he would have done something to satisfy the Committee. If he had attempted to show that this scale was a more equitable scale as between the members of the trade than Mr. Gladstone's, he would have done something, at all events, to show that he had improved upon Mr. Gladstone's scale. But there lies behind the duty another and a greater difference which still remains to be noted. The right hon. Gentleman and the Government have not yet shown us that the principles of elementary justice are not violated in the grossest fashion by the tax, which does not merely take a fraction of a man's income, but destroys his means of livelihood. It aims at driving many of these licence holders absolutely out of the trade to which they have committed their savings, and which is their life's work. They are sacrificing in addition to that that insurance fund which, with the -encouragement, with, indeed, the compulsion, of this House, they have been obliged to put aside against that day when, by a natural process they were not required for the public necessities, they would be extinguished. It seems to be a gross violation of the elementary principles of fiscal justice, and it is no consolation or excuse to tell us that this is to be a fortunate and admirable substitute for the abortive Licensing Bill of last year.

Mr. Emmott, I am not going to occupy the attention of the Committee for more than a few moments, because I do not wish to travel the ground which was so admirably covered in his able and illuminating speech by my right hon. Friend the Chancellor of the Duchy. I rise to reply to one or two points which the right hon. Gentleman who has just sat down has put before the Committee. I must protest in the strongest possible language against the notion which has become fashionable on the benches opposite that the Government ought to enter upon the Committee stage of a Bill of this kind with minds of adamant, with ears closed, and eyes bandaged, and absolutely refuse to accept any Amendment, backed by any argument, however cogent, and from whatever corner of the House it may have proceeded. I always understood the functions of the Committee stage to be to render legislation more acceptable to the general sense of the community, by listening to argument, making concessions in the cases of proved hardship, so far as it is possible and consistent with the principles of your, measure, and in adapting and accommodating it to the particular circumstances that were revealed. That is the course we have followed in this Bill, and I see nothing whatever to be ashamed of in doing so. Let me say in passing the right hon. Gentleman has paid perhaps an un-intentioned tribute to the principle—shall I say of Home Rule?—at any rate, to the principle of nationality. He taunts us with having yielded on some points last night to the representatives of Ireland in regard to the set of circumstances of their country. He was impatient, irritated, almost angry, that his fellow-countrymen in Scotland had not followed a similar course, and forced us to yield to them. I need not say, speaking for the moment as a Scotch. Member and not as a Member of the Government, if my colleagues in the representation of Scotland should present to us, and are disposed to present to us, any special case in regard to Scotland, similar to the case presented in regard to Ireland, we should be failing in our duty as representatives of the United Kingdom if we did not listen to them, and I will say the same even of the predominant partner.

Let me deal now with the two other points which the right hon. Gentleman has made. In the first place he has attributed to my right hon. Friend the Chancellor of the Duchy a statement which I did not hear, though I listened carefully to his speech, that these proposals were entirely dissociated from and had no connection with the Licensing Bill of last year. That was not the statement made by my right hon. Friend. My right hon. Friend pointed out with perfect truth, and supported his statement by evidence from Hansard, that for years past, long before the Licensing Bill of last year was dreamt of, it has been the policy of the Liberal party that if occasion should arise for meeting any gap in the resources of the revenues of the country, a revision of the scale of licence duties would be one of the first objects to which we should turn. That was stated by Sir Henry Campbell-Bannerman, speaking as far back as 1901—eight years ago. My right hon. Friend did not say that our proposals of this year had no connection with the Licensing Bill of last year. What was the object of the Licensing Bill of last year? It had two objects. One was to diminish what we considered to be the unnecessary multiplication of the facilities for selling liquor, the other was to secure for the State an adequate share of the monopoly value. We made propositions as to both these objects, and, as regards the second of them, propositions which we believed were not only just but generous. They were rejected, and deliberately rejected, at the instance of the trade itself, and it is therefore no longer possible for us to deal with the relation of the State to this monopoly value upon the lines of the Bill of last year. Are we therefore to leave the matter entirely alone? I heard an hon. Gentleman say why did you not deal with this before? Because we did not want money before. During my time as Chancellor of the Exchequer it was my happy duty to be engaged in the remission of taxation. Owing to circumstances with which everybody agrees a new situation has arisen. We are now obliged to look round us for the best and most equitable means of making provision for the new situation, and I confess, for my part, I am just as strongly of the opinion now as I was last year that when dealing with this matter from either point of view—the point of view whether there is any quarter in which you may more trust than in this monopoly value, conferred by the State as a source of enormous profit and wealth, to a particular set of individuals—that we should, as the Schedule sanctioned by this Clause does, claim a share, but not at all an excessive share. So much for the relation of these proposals to the Licensing Bill of last year.

Now let me come to a further and last point which was made by the right hon. Gentleman, and that is the general equitableness of the proposals themselves. He scored a rather cheap dialectical victory by suggesting that we, the proper custodians of the fame and traditions of Mr. Gladstone, are in this instance doing discredit to his authority and imperilling the justice and wisdom of the course he took in 1880. That is not a fact. The right hon. Gentleman probably does not remember, and many hon. Members here may not be aware of the fact that Mr. Gladstone, when he put forward his scale in 1880, was far from treating it as a system of registration duty. Fancy a system of registration duty which means a tax of close on 50 or 60 per cent. of the annual value. Mr. Gladstone, so far from treating it as a registration duty, expressly declared that one of his objects was the very object we have in view, namely, to secure for the State a share of the monopoly value which the State has itself created. That was Mr. Gladstone's principle then; that is our principle to-day. What we say is this: Mr. Gladstone proceeded, as he was bound to proceed in the first instance, in a tentative fashion; and he proceeded in what has been proved by experience to be, as regards the houses at the other end of the scale, a wholly inadequate fashion. But, as regards the principle of the two schemes, it is identically the same. Then the right hon. Gentleman says: Show us that your scheme is equitable? Does he or anybody on that side, or in any quarter of the House, defend the present scale? I do not think there is a single human being inside or outside this House who will dispute the proposition that it is grossly inequitable. This is not a question of the small houses. They are heavily taxed now. The right hon. Gentleman has represented our scale as though we are making an incursion into a new territory, and as though we are attempting to tax out of existence the small houses. It is not a question of the small houses, but of the larger houses and of beer-houses. I will put these concrete questions to the right hon. Gentleman or any person who is likely to defend the present scale: Is £3 10s. an adequate sum for the State to exact from a beer-house, the annual value of which is £100, and which, therefore, is, presumably, doing a profitable trade; or, again, is £60, the maximum under this scale, an adequate sum for the State to exact from the biggest gin palaces in London rated at £700 or even £1,000?

Surely those who oppose our proposals should make some attempt to justify the existing system. My first step is to show that the existing scale is really based upon principles wholly irreconcilable with the rules of equity. As regards the scale we are proposing, in all its lower stages, we leave the scale of 1880 substantially untouched, subject always to the new minimum and the rising minimum in regard to urban population. So far as regards the ordinary rural public-house there is no alteration of any sort or kind proposed by this Bill. I quite agree that when we get to the higher scale of houses over £50, £100, £200, and so on, we do apply to them the same principle more rigorously, just as Mr. Gladstone did in the case of the lower class houses in 1880. My right hon. Friend has said that if any cases of real hardship can be shown to exist, we are prepared to deal with them. We believe we have dealt with them because we admit that to take 50 per cent., or one-half of the annual value of houses at £500, £600, £700, or £1,000 might be unjust, and we have proposed in the schedule that in all cases where the value exceeds £500, one-third of the compensation value subject to the minimum of £250 shall be charged. We have met the hardship in the case of hotels, and if it can be shown when we come to deal with the clause affecting hotels that any further modifications of that kind can be made, we are perfectly ready to consider them. But taking the scale we propose with all its modifications and elasticities, and comparing it with the scale which is now in force under the present law of the land, I can confidently appeal to this House and the country when 1 say that our proposal is a far more equitable arrangement than the present scale, and for the first time it enables the State to reap back what it is fully entitled to, namely, a fair toll upon the monopoly value which the State itself has created. That, Sir, is my answer to the right bon. Gentleman's arguments. That is the basis upon which this schedule has been framed, and that is the proposal which we now ask this House to sanction.

The Question which was put by the hon. Member for Aberdeen has not been answered. That is a matter in which we on these benches are keenly interested. It is admitted that some increase in the revenue will accrue from the scale adopted, and I think we are entitled to have an answer to the question which has been put by the hon. Member for Aberdeen. The position, as I understand it, is that if your landlord is the brewer, under this Bill you are entitled to deduct from your brewer landlord the amount of the extra duty, but if your landlord is a private citizen you are not. It is an extraordinary fact that if you sell beer and you are a landlord under the tied house system, you must bear the whole of the new duty; if you do not sell beer and you are a landlord the tenant wall have to pay. Therefore, looking at this matter from a tenant's point of view, I wish to reiterate the question put by the hon. Member for Aberdeen. Take the town of Kingstown, which is practically owned by two brewers. Within the last three years every public-house in Kingstown has had its lease fall in; it has been rebuilt on terms imposed by Lord Longford and Lord de Vesci, which involve the imposition of very high rents. If these places had been owned by Guinness's brewery instead of by these noble lords, and if these terms had been imposed, the people of Kingstown would have been enabled to get back from the brewers the whole of the new duty. There are no tied houses in Ireland—except perhaps one in Dublin and some in Belfast. But take a case where a lease was entered into last year in the belief that Mr. Gladstone's legislation would be adhered to. It was agreed to pay the owners a sum of £100, that being a rack rent. In that case the State steps in and says, "I will put £50 more upon you."

Why should not the landlord bear his share of that burden with the tenant? He has extracted from the latter the whole of the monopoly value. These leases which fell in at Kingstown were 99 years' leases, and the landlord knew exactly what was the last shilling he could screw out of the tenant. I know as a fact that every one of the Kingstown tenants had to go to the bank to borrow £2,000, £3,000, or £4,000 in order to rebuild, and they are therefore not only paying an increased rent, but also interest to the bank. You are, in fact, aiding the tenant of the tied house, who needs no protection. He has not built the premises; he is not tied to them; he is only tied to the brewer. But in the case of the Kingstown tenant he is tied to the premises. If you put upon him an enormously increased duty, why should not the landlord be made to pay his share of that duty? Those who have to do with this matter seem, to consider the case of England, but to ignore altogether the case of Scotland and Ireland. The Treasury officials in Downing Street—or wherever they may be located—put their heads together to devise the best means of shearing the sheep, but they take no account of the difference in the position of the different countries. In regard to the tied house in England they say, "We won't hit the tenant, but we will hit the owner of the house, who is the brewer." They thereupon fire a shot, which brings down the man of wealth, who is the brewer, but when they follow the same course in Ireland they bring down the poor man, who is the tenant. You have, in fact, a clause protecting the tenant of the tied house in England, whereas the occupant of the tied house in Ireland is seriously affected. As the right hon. Gentleman said he is in favour of this method of proceeding, I want to know why the tenants who are called upon to pay this extra duty should not be entitled to deduct from their rent the whole of it, just the same as the tenant in England would be. Then the case of the man who has got a lease has been put and it has been asked if he could foe tied by that lease. Will the man who has got a lease, and an extra duty is put upon him, be allowed to sell that lease in the open market, or would the covenant of the lease bind him to keep up the licence and pay the higher rate? In other words, would these men, who are doing their duty to the State in a sense, be entitled to take their landlords into court and have their rent fixed? This is a case which you did not contemplate. You knew nothing about it, and in the dark you propose to inflict this very grievous injury upon these tenants; and remember, you are inflicting this injury upon men who have hitherto been solvent, and upon men out of whom you have hitherto been getting very large sums of money. I will say of the Kingstown men, all of whom I know, that all of them have rebuilt their houses, so that if you go through the place you will see that every public-house is a new house. Every one of them has been erected in the last five or six years, and in every one of them a rack rent has been exacted. Conceive the effect of this Bill. I am not in the least depreciating the value of the speech of the Prime Minister. I listened to that speech with the greatest gratification, but whatever the right hon. Gentleman does, unless he leaves things alone, he will be making a mistake. Of course, although the Licensing Bill did not apply to Ireland and Scotland, and we have no power to get compensation in Ireland, yet this Bill, for the sake of uniformity, must apply to the people of Ireland.

I say that there are about four times too many public-houses in Ireland. Who put them there? You did. It was your resident magistrates, at a time when it was part of British policy to keep Ireland soaked in drink. I remember a magistrate saying during the Fenian agitation, when that movement had put down drunkenness, in order to preserve their secrecy—I remember him saying to the police when there had been few cases of drunkenness, "This is something serious." It was you who spread these pitfalls and temptations, for your purposes, around the feet of the people of Ireland, and we ask if you are going to wipe the publicans out, wipe them out with some measure of compensation? That is all we ask. The publicans in Ireland would welcome some system whereby a very great number of public-houses would be wiped out upon fair terms, and, furthermore, I believe they would be willing to pay a fair tax on that behalf; and you must remember this, that while the English or Scotch publicans have never made a concession to morality, the Irish publicans have twice in succession agreed to Sunday closing, and with the Sunday Closing Bill of last year they came before this House and agreed in Dublin, Waterford, Cork, and other places, voluntarily to the reduction of their hours on Sunday and to the abolition of an hour of their working on Saturday night. Ask London publicans to give up an hour on a Saturday night. Ask them voluntarily to give up two hours of their Sunday trade. That is what the Irish publicans did in the Bill which passed unanimously through the House this year. While fully and gratefully accepting the observations of the Prime Minister, and fully understanding that he thoroughly appreciates this case, I say that the ultimate result of the Bill must be to put some extra burden upon these publicans. Not having the tied-house system in Ireland, I say, give us an equivalent clause, namely, let the landlords bear the burden of the new tax.

I think it almost an epoch-making fact in the history of this discussion that at length we have an official declaration by the Prime Minister that the Licensing Clauses of this Finance Bill are deliberately invented and framed to achieve one of the fundamental objects of the dead Licensing Bill. I am not going to dwell upon the danger of that admission from the constitutional point of view, having regard to a condition of things which may or may not arise in the immediate future. But I am going to ask the Prime Minister with great respect whether he has so soon forgotten the provisions of the dead Licensing Bill. I gather from his statement that had the Licensing Bill passed these provisions would not have become necessary in the Finance Act. The provisions of the Licensing Bill would have given the Government some of the money which it wants to-day. There would be 14 or 21 years to elapse before the nation recovered one penny piece of this monopoly value. If the Licensing Bill had passed there was to be no additional taxation placed upon the trade. For 14 or 21 years it was to pursue its normal course. The Government can not say that last year they did not know that this money was wanted. The Old Age Pensions Act was being passed. I want to know how the Prime Minister reconciles the fact that had the Licensing Bill passed 14 or 21 years would have elapsed before a penny piece would have come to the State from the monopoly value of the trade with the fact that he is now imposing a heavy immediate burden upon it as an alternative to the provisions of the dead Bill. That statement leaves me absolutely in confusion as to the attitude of the Government towards the trade. It drives one to the conclusion that, because the Licensing Bill was defeated, the Government think something much more stringent and much more immediate should be inflicted on the trade in the shape of a burden which the trade, as every expert tells us, is not in a position to bear.

The right hon. Gentleman stated in the course of this discussion that the Government is prepared to listen to representations not only from Ireland, but from Scotland, and other portions of the Kingdom. That was not the attitude of the Government so recently as last night. The right hon. Gentleman the Leader of the Opposition threw out a hint to the Scottish Members that if they were to organise as the Irish Members have done they might obtain some concession. I cannot help feeling that if the London Members would organise and cultivate the Irish brogue they might obtain similar concessions from the Government. It is in the recollection of the Committee that only last night, if ever there was a case made out for special treatment, it was made out for the London trade. The force of that case was never contested by the Treasury Bench, and we had no kind of response whatever to it. We are disorganised so far as the London Members are concerned. As regards 90 per cent, we are mere party hacks, apprehensive of the fate awaiting us at the next election if we do not obey the party Whip, and as regards the other 10 per cent, for party purposes we do not count, because we do not care for the crack of the party Whip. I recall that to the Committee as indicating that the Prime Minister could not have weighed very carefully his words when he said he would consider representations from any section of the Kingdom.

The Chancellor of the Duchy (Mr. Herbert Samuel) made an elaborate, learned, and didactic speech of the character to which we are all accustomed. He gave us wonderful statistics, and I was amazed to hear him say that the fact that the number of public-houses has not increased proportionately to the increase in the population, and that the consumption of drink has materially decreased had no bearing on the question of the justice of further inflicting penalties on this trade. Can the right hon. Gentleman point to a single statement in the official publications telling us that there is necessarily any relationship between the number of public-houses and the extent of sobriety or drinking in any part of the United Kingdom? The latest issue of licensing statistics tell us in express terms that there is no such relationship, and when we have the fact that with an enormous and increasing population there is an ever-decreasing consumption of alcohol, and an ever-decreasing number of arrests due to drunkenness and other objectionable incidents of this trade, it is preposterous that we should at this moment put a further burden on the trade for the purpose, openly and avowedly, of providing an alternative for the defeated Licensing Bill, and making the provisions of that Bill, instead of deferred in their character, immediate and oppressive. From that point of view the Prime Minister has done the Government no good, and I think it will be admitted that he has done the Liberal party a great deal of harm. What has been done must considerably aggravate the constitutional problem which is imminent.

The course of the discussion this evening has been more like a second reading Debate than the Committee stage of this Bill. The short, sharp, and decisive method of dealing with the licensing proposals does not appear to have been taken this afternoon. I wish to utter my strongest protest against the speech of the Chancellor of the Duchy, more especially in relation to his remarks on clubs. The Prime Minister has stated that he was willing to give due regard to the wishes of all parties in the country, whether Irish or Scotch. I ask him, therefore, to turn his attention to the North of England, where the evil arising in the district in which I live is five times larger than the Chancellor of the Duchy gave for London. The Chancellor of the Duchy stated that there had been an increase of only 13 clubs in London since the Licensing Bill was passed. There was no opportunity of going out of the House to ascer- tain, what is the actual state of affairs in the different parts of the country. But I know that in my own Constituency alone, within a radius of one mile, with a. large constituency of 52,000 electors, six clubs have been during the last two years struck off the register for drunkenness, disorder, and gambling, and some of these clubs contained 1,200 and 1,400 members. Within my own knowledge during the last two months in two districts two clubs have been started. In the case of one, near a colliery, where it has been my object to keep out public-houses, the Club and Institute Union, to which the Chancellor of he Duchy referred in such glowing terms took two cottages, joined them together, and formed them into a club. Drinking goes on at all hours of the day and all hours of the night. Within the last month, near a colliery town in Derbyshire, a man whom I dismissed for stealing has opened a club. He came to me, and I said, "I won't prosecute you; clear out of this." He opened a grocer's shop and turned it into a club, and drinking is going on in this club, which is open on Sundays, and any one can go into this club on payment of sixpence. When the Chancellor of the Duchy gives figures to show that the relative increase—

I really cannot say that it has anything to do with the Amendment; but I beg to ask, on a point of order, when a Minister in charge of a Bill with you in the chair gives full statistics dealing with the increase of clubs in all parts of the country, and indicates the policy of the Government, whether I am not entitled to reply to that, and, if I am not entitled to do so, may I ask whether it was in order for the Chancellor of the Duchy to have made those remarks?

The hon. Member has asked me a question. The Chancellor of the Duchy gave certain statistics as to clubs because it was suggested to him that although the number of public-houses had decreased, the number of clubs had largely-increased, and his remarks and statistics were entirely relevant to the Amendment. The hon. Member's remarks, so far as I have been able to gather, are not relevant to the Amendment, and unless he makes them so I shall warn him that he is irrelevant, and ask him to discontinue them.

Can a Minister quote statistics just as they suit him without being answered?

I have decided the point of order, and I cannot understand why the right hon. Gentleman asks me that question.

The reason I put the question to you, Sir, I hope respectfully, was because I did not understand your ruling, that was all.

The Chancellor of the Duchy has said in general terms that the number of clubs has not increased, but he has deliberately selected the towns most favourable to his own argument.

I really must protest against the observation of the hon. Member. I did not deliberately select the towns most favourable to my argument. I took practically all the towns that were given in the London County Council returns, and I said that in several parts of the country it was the case that the clubs had very much increased in number.

I do not think the right hon. Gentleman remembers exactly what he did say. I do not think when he gets the OFFICIAL REPORT to-morrow he will find that he stated that the clubs had "very much increased"—the words which he just now used—in different parts of the country. What the right hon. Gentleman did say was that in certain districts clubs had moderately increased. he did not say that they had very much increased. If hon. Members from Wales go back to their own country they will find that the increase of clubs in the Rhondda Valley and in Glamorganshire has been of an astounding character, and the hon. Member for Rhondda Valley (Mr. W. Abraham) has described drunkenness as the worst enemy of workmen in South Wales. I am thoroughly in agreement with the speech of the Prime Minister, and no one in this House is a stronger advocate of temperance than I am, but I have seen the increase of clubs continually going on, and the Chief Constables of Derbyshire and Nottinghamshire have told me that the increase of clubs in those counties is continuous and progressive.

Surely the hon. Member is not making any reference to-the Amendment. The question of clubs only comes in as affecting the question of whether the licences for sale should be dealt with in this Amendment.

I shall not pursue the subject further except to say as to what the hon. Member below stated, that if 90 per cent, of London Members are party hacks, and only 10 per cent, will follow; ha course they think right, then, I as a temperance advocate hope that the 90 per cent, will be sent into the wilderness, as I have no doubt they will be, and I trust the 10 per cent, remaining will hot be sent to represent liquor on the Liberal Benches.

There is one case to which I wish to call attention. I understand that during the evening we have been discussing practically the first Schedule, and I may not have an opportunity of drawing the Prime Minister's attention to this case if I do not do it now. Take our own locality. At the present time under this Schedule the minimum

duty would be between 10,000 and 50,000 of population if the licences are issued before March next. On the 10th March, owing to an Act that was passed last year, the amalgamation of all the urban districts will take place, and the consequence will be that whereas in the whole district if they had never passed the amalgamation the licences would be on the scale between 10,000 and 50,000 in population, you are going by the amalgamation on 10th March to run them right on to the top of the scale. That is at least a point that the Prime Minister should consider a little later on in this subject.

Question put, "That the words ['or sale'] proposed to be left out stand part of the Clause."

The Committee divided: Ayes, 186; Noes, 108.

12.0 P.M.

ruled five Amendments out of order as covered by, or outside the Resolution, or as applicable to another Clause.

moved to add to the end of the Clause the words: "The said duties shall be charged on any licences which shall have been granted after the first day of July, nineteen hundred and nine, or may hereafter be granted, but in the case of any such licences granted before the thirtieth day of September, nineteen hundred and nine, the amount of the duty shall be adjusted so as to make the sum payable in respect of the period up to that date such sum only as would have been payable if this Act had not passed."

In the course of the discussion last night reference was made to an answer given by the Secretary to the Treasury which had been relied upon by the owners of the licences, and a concession was promised by the Prime Minister, which hon. Gentlemen opposite expressed themselves satisfied with. This Amendment is put down in order to carry out that concession. The result in a word is this: that licences granted on July 1 will be free from the increased duty up to September 30, and as from the latter date will be subjected to the increased duty.

I am convinced that the Government desire to carry out their undertaking with perfect frankness. But if the Bill does not become law, will the balance that may have been paid over be returned? If on further examination the words do not carry out that purpose the Government will, perhaps, reconsider the matter, and put in words that are found to be necessary.

The Amendment which is put down to Clause 39 on the Paper clears the point.

I should like to make an observation en one matter which is not covered by the right hon. Gentleman's pledge. The 'Government think it right to impose certain new burdens upon the licence holder. They propose to apply different classes of burdens to different classes of licence-holders. The idea is that every licence is from a certain day to become subject to an increased charge. I submit that the equitable thing as among the various classes of licence-holders is that they should all begin to pay the new burden on the same day. The Prime Minister did not undertake to do that yesterday, and of course his Amendment does not do it, but I submit it is the equitable thing to do. In the case of the ordinary on-licences, the date from which the new duties would be imposed would be the 30th November. In the case of what we may call the July 5th or July 6th licences this Amendment would make it the 30th September. There is no reason why the burden should be imposed on one class of licence-holders earlier than on another. There is no reason for charging the July licence-holders for a longer period than the others, but their licences expire first, and the new duties in their case are enforced earlier. The facts of the case as between the different interests are clearly not met by the present arrangements, and I ask the Prime Minister whether he cannot agree that the new burdens shall begin to apply as from the same date, and that that date should be the 30th November?

The pledge which I gave applied to the specific case in which it was alleged that some of these persons might have been misled in applying for licences, and my pledge was strictly confined to that. I did not consider the point which the right hon. Gentleman has now raised, and I do not consider that this is the proper place to raise it.

I did raise the point yesterday, but the Prime Minister was engaged at the time, and possibly did not hear it. I felt bound, therefore, to raise it now. I will not ask for a pledge, as the Prime Minister says he has not considered the point. All 1 ask is that he should consider it. If the Government will consider it before Report stage, and be prepared to make the concession, or give me reasons for not making it, I will not press the matter further now.

moved, at the end of the Clause, to add the words "and the said duties shall be payable as to one moiety on the dates specified in this Act, and as to the other moiety within three calendar months of such date."

I think it would be better to deal with this matter in the Schedule. I do not see any objection to the suggestion made if it does not mean any sacrifice of revenue this year I therefore suggest that this is not a convenient place to move this Amendment, and I ask the hon. Member to postpone it until we come to the Schedule.

I think in the circumstances under which our Debates are conducted it is better to introduce Amendments when we have an opportunity. I wish to press this Amendment because it is very important. The licensee will have to go in most cases to the brewer, and in that case probably the brewer will have to go to his banker, and the banker under the circumstances may not always be quite willing to make these advances. I move this Amendment in order that it may be possible to divide the payment of these duties into two payments.

I hope the hon. Member will not force us to discuss this matter now, and I trust he will not divide the Committee upon it. My suggestion is made in the interests of the spirit of the Amendment, but this is not the proper place. The Government do not object to any proposal of this kind being proposed when we reach the Schedule, if it is clearly understood there will be no sacrifice of revenue this year.

If the Solicitor-General will give me an assurance that he will accept this Amendment in principle I will agree to the course he suggests?

I hope my hon. Friend will not press his Amendment at this stage. The position as I understand it is this: The Solicitor-General is not prepared, to give my hon. Friend a definite pledge to accept his Amendment. I take it that the Solicitor-General means that my hon. Friend shall have an opportunity of raising this Question on the Schedule, and that he will not be shut out from raising this point. The Government, as I understand it, promise to give this Amendment serious consideration and do not object to the idea of accepting it. I think there are obvious advantages in the Amendment, as pointed out by my hon. Friend, but I really rose to appeal to him to be content at this stage with the offer of the Solicitor-General.

I went further. We will not only give it serious consideration at the proper place, but also sympathetic consideration, so long, as there is no sacrifice of revenue

Then we shall have to discuss it on the Schedule.

Amendment, by leave, withdrawn.

Question put, "That the Clause, as amended, stand part of the Bill."

The Committee divided: Ayes, 155; Noes, 96.

CLAUSE 30.—(Valuation of Licensed Premises.)

(1) The annual value of any premises for the purposes of any duty charged in the First Schedule to this Act shall be determined in the same manner and subject to the same conditions as the annual value of premises is determined for the purpose of a publican's licence, and in the determination of that value the duty on the licence is not to be allowed as a deduction.

(2) It shall be the duty of the Commissioners, as soon as may be, to prepare, and to keep corrected, a register as respects all fully licensed premises and beerhouses respectively of the amount which would be payable as compensation in respect of the premises under Subsection (1) of Section 2 of the Licensing Act, 1904, if the premises were premises in respect of which compensation was payable under that Act, and of the sum which is to be treated for the purposes of this Act as the annual equivalent of that amount (in this Act referred to as the annual compensation value). That amount and sum shall be certified respectively by the Commissioners of Inland Revenue.

In estimating for that purpose the value as licensed premises of hotels or other premises used for purposes to which the holding of a licence is merely auxiliary, no increased value arising from profits not derived from the sale of intoxicating liquor shall be taken into consideration.

(3)The licence holder and any person interested in licensed premises shall, if required by the Commissioners, make a return in such form and containing such particulars as the Commissioners may require for the purpose of the ascertainment under this Section of the annual value or the annual compensation value of the premises, and if any person fails to make such a return within the time, not being less than thirty days, specified in the return, he shall be liable on summary conviction to a fine not exceeding twenty pounds.

moved in Sub-section (1) to leave out the words, "determined in the same manner and subject to the same conditions as the annual value of the premises, is determined for the purpose of a publican's licence," in order to insert instead thereof the words, "the annual value of that part of the premises in which intoxicating liquor is sold and consumed."

The object for the Amendment is to give some measure of fairness to the publican. If the annual value of the premises is to be justified as the basis on which our License Duty is to be assessed, it seems to me to be only fair that that part of the premises which is actually used for the business of a publican should be chosen. The rest of the premises are in many cases used for residential purposes, or if they are situated in the City or a place of that sort they are used as offices. The part of the premises generally used consists of the ground floor, and possibly the basement. In the country the question is also important, because it very often happens that the stables are attached for posting and. livery business, and those have been reckoned to be part of the premises and included in the assessment. An hon. Member asked a question a short time ago of the Chancellor of the Exchequer as to what would be the result of this particular Clause in the case of a public-house in the country to which stables were attached and whether the stables would be included in the valuation. The answer of the Chancellor of the Exchequer was to the effect that the stables would be included. This particular Clause fixes the assessment upon the gross annual value, and I believe I am right in saying that this is the first time that has been taken, and in view of that fact I think it is only fair that it should only be taken upon that part of the premises which are actually used for the purpose of the consumption of liquor. It may be urged that it is difficult to determine how the valuation should be arrived at if my Amendment were carried. I belive that there are instances where a valuation has been made upon a separate part of the premises. I am informed that Sub-section (4) of Section (11) of the Licensing Act of 1902 gives the justices power on licensed premises to order alterations of certain kinds to be made in that part of the premises where intoxicating liquor is sold. So that principle has already been acted on, and I am informed that those words have been the subject of judicial interpretation, and if the Government urge that it would be impossible to do so, I refer them to that particular case. It may be said this is not a very important Amendment because by Sub-section (2) of the same Clause it is intended to enact that as soon as a valuation is made, the assessment for the purpose of charging the Licence Duty shall be upon this new valuation, and not upon the new plan set forth in this first Schedule. But yesterday we were informed that this valuation could not be made for three or four years.

The Chancellor of the Exchequer defended making the difference in the charge of the Licensing Duty first upon the annual value and then upon some other basis of assessment, on the ground that the valuation would take three or four years, and he was interrupted by hon. Members who asked how it was in that case that he proposed to make the landlords make their valuation in thirty days, and he replied that in that case the landlord would do it, and in this case the State would do it. I did not quite see the force of the argument unless it was that the State takes longer to do a thing than a private owner. That is an argument against the Socialistic tendencies of hon. Gentlemen below the Gangway and with the Front Bench opposite. It shows that business after all is managed better by private people than by the State. If this valuation is going to take three or four years, in the meantime every house under £500 a year will be charged upon the annual value, and we ought to see that no injustice is done during these three or four years. There is no obligation on the Government to Hurry with this valuation. If the Government remained in office for ten years there is nothing to compel them to make this valuation. They may say, "Oh! we are making it, but it is taking longer than we thought it would take." That might go on for ten years. [An HON. MEMBER: "We do not want it."] My hon. Friend says that we do not want to make the valuation, but that is a point we had better discuss at another time, and not on this Amendment. The Chancellor of the Exchequer defended it on the ground that this was only a temporary arrangement, and that when we got the new assessment everything would be for the best in the best of worlds. I hope I have shown to the satisfaction of the Solicitor-General that there is a strong case for the Amendment. The Prime Minister told us that one of the great objects of an Opposition was to suggest Amendments, and that the Government should accept them when they were reasonable. I have shown that it would only be fair to assess the premises which are used for the business. I have never heard of an assessment being founded on the annual value of premises which are not used for a particular business. I have received a letter from one of my constituents in which he informs me that he only uses the basement and the ground floor for the purpose of selling liquor, all the rest of the premises being used for the purpose of offices. The value of the whole premises is very much larger than the value of the part used for selling liquor, but unless this Amendment is accepted that unfortunate person will be assessed on the value of the whole.

The hon. Baronet reminded us of the statement of the Prime Minister that we are always ready to listen to proposed Amendments, and to accept them when they are reasonable. I am sorry I cannot say that this is a reasonable Amendment. I will endeavour to show that it is not reasonable, and that it is disposed of by all the precedents of this kind in legislation. The hon. Baronet seeks, for the purpose of assessing duties, to value only that part of the premises in which intoxicating liquor is sold. The effect of that would be that it would be only the ordinary bar or taproom of a public-house, or a coffee-room, or commercial-room of an hotel that could be rated. Anybody will see that it would be extremely difficult to value those parts of the premises as distinguished from the other parts. Legislation up to now has proceeded on the value of premises as they are licensed by the licensing justices. In the case of a hotel, for instance, there are many parts of the premises on which intoxicating liquor could be sold or consumed, but on which in fact it is not sold and consumed, and it would be quite unreasonable to ask that those portions of the premises, which nevertheless are part of the licensed premises, should be excluded from valuation. We are not departing from the principles of the valuation according to the Act of 1880, although the duties are imposed according to a different scale. I daresay that the researches of the hon. Baronet will enable him to find that an Amendment similar in spirit, though not in words, to this Amendment was moved to the Bill then introduced by Mr. Gladstone, to exclude stables and various offices and gardens from the valuation, and Mr. Gladstone said he could not approve of the proposition, as the effect would be to reduce the valuation, say, from £20 to £13 a year, and the result would be that the small trader with spirits would pay a smaller tax than previously. And in the schedule to the Act of 1880 it is provided that if the annual value of the dwelling-house in which the retailer shall retail spirits, together with offices, courtyards, barns, etc., is under £10, £15, and so on. That was the state of things in 1880. The hon. Baronet now seeks to go much beyond that. He seeks to exclude from the valuation all parts of the licensed premises, whatever they may be, unless it can be proved that in those parts intoxicating liquor is not only sold, but is actually consumed. That I submit would be to reduce the valuation of the pre- mises much below what it ought to be for the purpose of Licence Duty.

The hon. and learned Gentleman says that it would be difficult to arrive at a valuation of portion of the premises separately. On the 15th of June the Chancellor of the Exchequer, in answer to a question, said that if portion of the premises were not in occupation of the holder of a grocer's licence, that portion would not count for the purpose of assessing the annual valuation for Licence Duty. Why should the grocer have an advantage which is denied to the publican, especially as the publican in this case in which I mentioned has part of the premises sublet for offices?

The principle is that you must value the premises which are included in the licence. With regard to the answer of the Chancellor of the Exchequer to which the hon. Baronet referred me, of course, if a part is sublet and under separate occupation, no doubt there would be no difficulty in making the valuation of that part; but I do suggest that in valuing you cannot separate the bar-place, coffee-room, tap-room, or whatever place in which intoxicating liquor is ordinarily consumed, from the rest of the premises. We do not depart in the slightest degree from the valuation which was made in 1880, and which has been made from then until now. The practice is to include in the valuation all portions of the premises—offices, stables, and so forth—comprised in the licence given by the justices, and therefore form part of the licensed premises.

I agree in principle with what the Solicitor-General has stated. But the moment you make a very large increase in the valuation then immediately an effort will be made to except from the licensed premises particular portions. When a man is paying a small duty he has no object in segregating particular parts of the premises. I submit that if the Customs authorities make entries of premises as being licensed premises, then there ought to be some provision for enabling those who have very high Licence Duties to separate portions of the premises from the rest for purposes of valuation. I quite agree if gardens are used on the Sunday, as we see in London and up the river, for the purposes of the licensed premises, then they are quite as much part of those premises as if they formed part of the actual building. But that would be a wholly different case. Once you enormously increase the Licence Duty, then I think you should give to the occupier of the licensed premises the option of dropping that portion of them which is really not necessary for the purposes of carrying on his licensed premises, although it had not hitherto been worth his while to shed it or cast it off. Where a man carrying on the business of a jobmaster, or of a garage—and he has to pay the petrol tax separately, and the motor tax separately—I do not see why that garage, though it is annexed to his hotel for the purposes of his business, should be included in the valuation. In 1880 it was not worth his while to have a separate valuation. If the publican sub-lets a part of his premises he must take the risk; that is to say, he must be made to pay on the portion sub-let. He might evade the tax by saying, "Oh, I sub-let my garage, or I have sub-let the pair-back to a lodger." I would not tolerate for a moment such a state of things. What I am referring to is a separate portion of the premises which it was not worth while to take into consideration in 1880, but which it is well worth while to take into consideration now, when the tax is enormously increased.

I very much agree—a rather singular position for me to occupy—with the hon. and learned Member for Louth (Mr. T. M. Healy) in the complaint which he put forward that my hon. Friend the hon. Member for the City (Sir F. Banbury) in his Amendment does go too far. There is real substance in that portion to which the hon. and learned Member for Louth has referred, and for the very reason which he put forward I was surprised that the learned Solicitor-General did not see that the quotation he made from Mr. Gladstone told against himself. It was no defence whatever for what the Government are doing now. The passage from Mr. Gladstone stated:— If I made this exception to the scale of duties which I have imposed, the publican would actually pay less than he has hitherto paid.

And because of the scale which Mr. Gladstone adopted, but that does not in the least apply to the present scale. It is not the question whether Mr. Gladstone used those words, it is his statement of fact. If you have a low scale, such as Mr. Gladstone's was, it might very well be that to omit these exterior portions of the premises for the valuation would be under the new scale actually to demand less for the publican than he previously paid. That could not be the case under such a proposal as is given by the hon. and learned Member for Louth, coupled with the scale of duties the Government propose. The learned Solicitor-General will therefore find no defence for what Mr. Gladstone said. I have already said I do not go so far as the hon. Member for the City, nor desire to break up, so to speak, for the purposes of valuation, the actual building in which trade is carried on from which liquor is consumed, but I must say I was astonished to hear the Solicitor-General ask how can you value the ground floor part for the top floor; and he said in that case, how are you to treat the ceiling? I should have thought that the ceiling belonged to the ground floor, and the floor above it to the floor above it. The Solicitor-General has got to find a solution of that difficulty because in the Land Taxes the very thing which he declares impossible has got to be done as flats have to be valued. Then we will have to decide whether the ceiling belongs to that floor or the floor above it. I should have thought it was a very simple question, and I am sorry the learned Solicitor-General is puzzled by it.

There is one point which the Solicitor-General has overlooked, and that is as to season hotels in Scotland, which are only opened for a small portion of the year, and which fill a great public want. Owing to the necessary circumstances of the case, it would be impossible for them to have the large accommodation which they provide for the public utilised during the whole of the year, and as a consequence their bar receipts will not come within the limit proposed by the Government. The consequence will be that those hotels will have to be closed if the Amendment of the hon. Member for the City is not adopted. The Solicitor-General informs me now that the matter will be discussed later on, and I can do no more now than mention the fact. I have already mentioned it to the right hon. Gentleman, the Chancellor of the Duchy, and I have no doubt he will give it serious consideration when the occasion arises.

Will this discussion cut out the Amendment of the hon. Member for Kidderminster (Mr. Barnard)? If so, we must raise the point here.

I think it raises the same point; so that if this Amendment is decided, the other cannot be raised.

Shall I have an opportunity of raising the question as to Scottish hotels on Clause 31?

If it is a hotel matter it must be raised on Clause 31, unless the receipts from the sale of intoxicating liquor are more than one-third of the total receipts.

I have had a number of letters relating to country houses, where this is a very practical point. Frequently in the country a public-house has attached to it a stable, a garden, a courtyard, or something of that kind, and as the matter now stands the licence is for the whole premises. In the case of a beer-house, where the duty is fixed, it is immaterial whether you include these outlying parts or not; but it would be very material under this Bill, because every item which adds to the annual value will increase the amount of the tax. It may be said, why not get the licence altered so as to exclude these outlying parts. That is not practically possible. There would be a risk of losing the licence, or having difficulties raised. The buildings, having been once included, they must remain in, at all events for some time. The point is, therefore, One of substance, and I put it to the Government that some provision should be made to meet it. I hope this particular Amendment will not be pressed to a division, as it would prejudge a later question, but I trust the Government will consider whether something cannot be done.

I understand I shall have an opportunity of speaking on my own Amendment?

If this Amendment is withdrawn the hon. Member will be entitled to move; but not if this one is negatived.

1.0 A.M.

I do not ask my hon. Friend to proceed to a division, but I wish to impress upon the Solicitor-General the very great importance of giving further attention to this subject. I agree with what he has said as regards fully licensed beer-houses. There are cases which press very hardly on the on-licence as well. I do not think the Solicitor-General or the Committee quite realise what these words which are now moved mean. Previously the beer-house paid the least charge. These words that are being moved into the Clause would make the beer-house pay on its annual value. In the same way, the wine licence is to be entirely altered and very largely increased. I really think the question raised is one which needs the very serious consideration of the Government, and I therefore press the hon. and learned Gentleman (the Solicitor-General) to give it further attention, but I hope that my hon. Friend will not proceed to a division on the Amendment.

I desire to ask the Government for a definition in the case of an office. I have in mind the case of offices on the first, second, third, and fourth floors of a building, in the basement of which is a restaurant or very small room, probably for the provision of what are called quick lunches for busy City clerks. Rooms in the basement used for that purpose are to be found frequently, and the proprietors are not able to pay a very large rent, and therefore they would not be able to pay a very large Licence Duty. Now, in that case, is the restaurant to pay the Licence Duty on the assessment of the whole building? I desire to know whether that is so or not, because this Amendment does touch that, although it may not touch some other cases which have been referred to.

Clearly no, says the hon. and learned Gentleman. If that is so, on what assessment is the retaurant keeper to pay? On the assessment of the licensed premises only?

I rise to ask leave to withdraw the Amendment. But before doing so I wish to say I am glad that the hon. and learned Solicitor-General has seen the force of my argument in regard to restaurants in the City, though in some other places he finds the difficulty apparently insurmountable. I do not know how he arrives at that view. My hon. Friend (Colonel Walker) spoke of a quick lunch. I have seen quick-change artists, but I have never seen such a quick-change artist as the Solicitor-General, having regard to the position he now takes up and that which he took up some time ago.

Amendment, by leave, withdrawn.

moved to insert the words "including, as respecting licensed premises in Ireland, the provisions of Subsection (7) of Section (43) of the Inland Revenue Act of 1880." The Amendment is rather different to that which I have upon the Paper, though it does not differ in any way in substance, and it has been suggested to me that it should be moved in this alternative form. As to the subject, I do not think it is necessary for me, after what was said last night, to argue that at all.

Question put, "That the words proposed be there inserted."

I do not think the words are strictly necessary here; but I agree that it is better to insert them here than elsewhere, if they, are to be inserted at all. I do not object to the words at all in the form in which they are now moved. The result will be this, that so far as Ireland is concerned, the valuation will take place according to the principles laid down in the Act of 1852—the original Valuation Act. That Act was adopted as the basis of valuation in the Inland Revenue Act of 1880, which is the provision mentioned in this Amendment, and the result will be that everywhere in Ireland, where valuation has taken place under these valuation Acts, that will be the valuation for ascertaining the duties under this Bill when it becomes law. There are two cases of re-valuation which have either been made or are in course of being made. Since the Local Government Ireland Act, 1908, there has been a new valuation which has been completed in Belfast; there is also being made a new valuation in the City of Dublin. As to Belfast, the valuation which will apply will be the valuation made since 1898, and in Dublin the value which will apply will be that in the course of being made, because in both cases the valuation is made under the Act of 1852 and the Acts amending it.

Yes, that is so. It also follows that in every county borough in Ireland where a valuation is made under the Act of 1898 that valuation will also-apply. It really means that in Ireland we are making no difference at all from the basis of valuation which would apply to these duties if this Bill had not been proposed. I accept the words.

May I ask the learned Solicitor-General if the result of this Bill be that so far as Scotland is concerned the levy will be made on the valuation in all respects as it is now.

In that case it is clearly to be understood that the right hon. Gentleman is differentiating very seriously against Scotland. I make no objection to and no complaint of my Irish friends getting this concession. I think they are very lucky to have got it, and I am glad Griffith's valuation is to apply in their case. There is something very different between that and the Schedule A valuation, which is to' apply to Scotland. I hope that the Committee will clearly understand that the differentiation, which the Financial Secretary to the Treasury said in answer to the hon. Member for Rutland (Mr. J. Gretton) was not to be made between the three Kingdoms, is in fact now taking place.

May I ask the Solicitor-General as regards this so-called concession to Ireland, whether part of the Clause will not require to be altered if the valuation continues just as it is.

moved to leave out from Sub-section (1) the words "and in the determination of that value the duty on the licence is not to be allowed as a deduction."

This is an extremely important Amendment, and unless it is accepted I venture to say that it will be absolutely impossible to arrive at a correct valuation of the annual value of a house. If the Government accept it we shall known that the Government are really desirous of arriving at a true and correct valuation. If they refuse to accept it we shall be forced to the conclusion that their desire is not only to crush the publican, but to so manage the imposition of the charge that it shall be increased beyond any amount which in the ordinary course of events could possibly be imposed upon anyone. I cannot conceive what arguments will be used by the learned Solicitor-General against the adoption of the Amendment. The ordinary way of arriving at the value of a house or hereditament is by ascertaining what the house or hereditament would let for to a willing tenant in all the circumstances of the case. That is the sole method of arriving at the value of a house. If you do not accept my Amendment the result will be that you will not arrive at the true value which a tenant would give if he were asked to come forward and take the house. Any man in agreeing to pay a rent for a house would first of all say to himself, whether he is a publican or anybody else, "What are the burdens I shall render myself liable to if I agree to pay that particular rent?" I will give you a concrete case which will show what I mean. A man, for instance, may be willing to give a rental of £280 a year for a public-house, of which the Licence Duty would be £35. He would then be paying £.320 a year. But if the duty is increased to £140 the house would then be worth £105 a year or less, because he would have an outgoing of £105 more than now. If you are going to declare that annual value is to be calculated as if no extra charge is imposed, you are making the calculation of that annual value merely a sham and a delusion. Supposing no deduction is to be made for the Licence Duty, as is proposed in this Section, how would the valuation be made? It might be held that as no deduction is allowed in the future for the duty that is imposed, that in assessing the value at the present moment not only present rent should be taken, but that the amount of the present Licence Duty should be added to the rent.

I can easily conceive that a Treasury official anxious to gain that bounding revenue, which the Chancellor of the Duchy, in finishing up the second reading of the Licensing Bill, said would flow into the coffers of the Exchequer, would suggest that this would be a method of squeezing a little more out of the public. I believe there is an appeal, but even with that there is no doubt that the Commissioners, who are the first tribunal under this Section, would take the side of the Treasury, and the publican would find that not only was he allowed no deduction in arriving at the annual value for the amount of the Licence Duty, but the existing Licence Duty was actually added on to the annual value of the house. I think I need not detain the Committee any longer. My proposition is so self-evident that I believe it to be quite impossible for the Solicitor-General to deny that there is justice in what I have said. The only conclusion I can come to, in the event of the Government refusing to accept my Amendment, is that they are determined by every possible means in their power to crush out the existence of this particular trade. I earnestly hope the Solicitor-General will accept the Amendment, and place the publican in the same position as any other person would be placed in who had to pay taxes or rates on his annual value.

The effect of the acceptance of the Amendment would be to make a very considerable change in the law as it exists at present. It is to be observed that the hon. Baronet's Amendment would, in the assessment of the annual value, allow deduction not only of the increased duty, but of the whole of the duties which are imposed on the house. The law and the practice invariably is not to allow as a deduction in ascertaining the annual value of licensed premises the duty paid on those premises. The hon. Baronet has not confined his proposition to the increased duties which are proposed to be imposed by this Bill. I only say that in order to show that the hon. Baronet is really proposing to alter the law as it at present exists, an alteration which, I need hardly say, the Government could not possibly accept. We adopt the law as it exists at present, and when the amount of these duties has been ascertained, after the Bill has become law, we do not propose anymore than now to make any deduction in respect of duty in the ascertaining of the annual value of the premises.

I must confess that I do not understand the argument of the Solicitor-General. The effect of the words if they remain in is to alter the law, and if we take them out they leave the law as it now is. The Amendment in no way embodies a proposal to alter the existing law, but leaves it as at present. We are dealing here not with the net value, the rateable value, but with gross value, and in connection with gross value the question of deduction does not arise at all. I have never been able quite to understand the wording of this part of the Clause: "In the determination of that value the duty on the licence is not to be allowed as a deduction." It is not so allowed now. There is no question of deduction, and therefore the words as they stand really have no meaning or effect. I think the meaning must be that in ascertaining the gross value you are not to take into account the fact that the duty has been raised. If that is the meaning, I am opposed to it. The assessor has only to consider in the first place what the house will let at. It is quite clear, if you do not insert the words, that in considering what a house will let for he must consider what a possible tenant would give for it, and in considering the rent he would offer a possible tenant must take into account the amount of the duty. What by these words do you enjoin on the overseer? Either that he is to ascertain the annual value in the proper way, and then add the increase of duty, or that in estimating the annual value he is to shut his eyes to the facts; he is to put out of account the fact that the duty has been raised—he is, that is to say, to act as if it had not happened, and is to put therefore a wholly fictitious value on the house. If it be the fact that the Licence Duty is not now deducted in the sense of this Sub-section, then the increased duty would not be deducted, and so we do not want these words. If, as I believe, the words would have the effect of forcing the overseer to put on the premises a fictitious annual value, clearly they are unjust and ought not to be kept in the Bill.

I do not think the Government have quite considered the true effect of these words. Let us suppose that the words were "increased letting value." Take the ordinary rates, say, of London and Dublin. When you are letting a house how do you decide what is the letting value of that house? The letting value must be considered in connection with the rates. If the rates have been compounded and the landlord pays them, the letting value of a £100 house is £150. But if the tenant pays the rates and the rent is £100, the letting value is only £50. Surely it must be the same with taxes. The value of anything is what it will fetch in the market. The word "value" is a fictitious thing. What is the value of a sovereign? What is the value of any- thing? It is, I repeat, what it will fetch. Here you say in this case: If my lease was £100 a year and my taxes were only £50, and you increase my taxes to £100, the value of my lease remains the same. It is a contradiction in terms. This thing will not be carried out. Human nature is above all Governments. You may direct a man to do what is wrong until you are black in the face, but he will not do wrong unless it is to his advantage. If this direction were given the Government officials would not act upon it, because they know very well that these enormous taxes which are being put on will pull down the value of every public-house in England, Ireland, and Scotland. You say you will direct your valuers not to take into account a fact over which all Great Britain will be "sizzling" when the Bill has been 12 months in operation. The Government have not begun to understand this Bill yet. I respectfully say this, that these words are against public justice; I say they are against public policy, and I say, furthermore, that such will be the outcry at this valuation all over the country, that in Ireland—I do not know what you have in England by way of appeal—in Ireland, at any rate, our courts will be glutted if any such thing is to take place. Dublin is now being re-valued and the re-valuation will come into effect in the course of a few months. In Belfast there has been a re-valuation and the whole value of the licence has been added to the valuation: in consequence of the decision of a Court of Appeal it was decided that it was to be added to the valuation. Here you say it is not to be taken into account in the valuation. I should like to know what the effect of this Clause will be in Belfast. Am I to understand that Clause 30, Sub-section (1), is to apply all over England, Ireland, and Scotland—that is to say, in the manner and subject to the same conditions? I assume that is the meaning of this Clause. It goes on to say, "And in the determination of that value the duty on the licence is not to be allowed as a deduction." It seems to me that the result of that will be that we shall have to have a fresh valuation of Belfast, because, undoubtedly, in valuing the Belfast premises the fact of the Licence Duty was taken into account; the existence of the licence, and with it the duty was taken into account. Therefore, as I understand this Clause, it will give the Commissioners of Valuation fresh letters of marque as against Belfast.

But why should the Government propose this at all? Surely you are slicing down these unfortunate public-houses sufficiently by means of the Whisky Duty, the Beer Duty, and these enormous charges. To go on with this penultimate injustice is against all human fairplay. It is against all notions of justice. Would you say as regards any other premises throughout the Kingdom that the public charges, whether they be taxes or whether they be rates, shall not be taken into account? I respectfully think that sufficient consideration has not been given to this Clause. These Clauses are an amalgamation of all the Treasury cunning and of all the Treasury malice—not political malice. There is the ordinary teetotal malice against the publicans of which you cannot complain, but the Treasury see how they can skin a man whether Tie is a Liberal or a Conservative. And yet you have put in this Clause the very acme of extortion. The learned Solicitor-General may have answered off-hand without consideration, but if he has considered it I respectfully think it requires re-consideration. To make any such provision will lead later on to such an outcry against it, as being against public interests, that it cannot very long stand upon the statute book if, indeed, it is ever put upon it.

This may not be more than a matter of words. I am not quite sure of that. But I am quite sure of this, that the Government must deal with this matter one way or the other. They must either strike out these words or in some way alter them so as to make it perfectly clear what the intention of this Section is. As these words stand they may mean one of two things according to the intention and meaning of the Government. Either the words are unnecessary and confusing, and may be exceedingly dangerous, or else they bear a meaning that suggest the grossest position of injustice. I cannot conceive that they are meant to give this 'direction to the valuer, that in valuing licensed premises he is to value them as though they were gratuitously licensed. I cannot conceive that that is the instruction meant to be given to the valuer. Now, of course, when a valuer values licensed premises as a going concern, he takes the licence into account. There is no question of deduction at all. The valuer takes the licence into account on both sides of the ledger. He asks what would the tenant say. He would say on the one hand, "These premises have got a valuable licence, and therefore I can give a good deal more rent than I should otherwise." That is on the one side, but on the other hand he would say, "I shall have to pay for the licence, and in so far as I have to pay for the licence, so far, of course, it must reduce the rent." Therefore the licence tends in one case to increase the rent, and in the other case to decrease it, and the valuer takes the matter into account on both sides, and arrives at the result. Is that what the Government intend him to consider and intend him to do? I understand their intention to be England, Scotland, and Ireland, according to the separate systems which respectively prevail, those systems are to continue, and there is to be no change. If that is so, these words are perfectly unnecessary. The Section is complete without them, and their insertion can only be to the greatest danger and confusion, because any valuer reading this Section, and reading down to this point, which says that the annual value is to be ascertained in this manner, and then goes on to say, "and in the determination of that value the duty on the licence is not to be allowed as a deduction"—the valuer will be put to it to give a meaning to those words. The Solicitor-General has given no indication, as I understand, why they are there and what practical effect they are intended to produce. There is the greatest danger that the valuer, in trying to decide, and the Court in trying to give some meaning to these words, may say, "They must mean that the licence is not to be taken into account so far as it reduces the rent, but only so far as it increases it." I do not think that that can be the intention of the Government.

Where learned experts differ in the interpretation of this Clause it is, perhaps, unwise for a layman to express any opinion. I do not do so, but simply rise to recall the fact that the Government have as yet supplied no answer to the arguments advanced to the Committee. I desire to ask the Solicitor-General one question: His conclusion, which is challenged by my hon. and learned Friend, is that this makes no change in the law?

What is the difference between the law and the law as it is understood?

The law can be stated to be the law if it has not been disputed, if no case has arisen that gives a legal decision upon the matter. The statement of the law must be taken, of course, through the authority of the person who makes it. What I say is that the practice has been since 1880 not to make a deduction for the Licence Duty. That has never been challenged, although there has never been, so far as I am aware, legal decision upon it.

Then the contention of the Government is that the practice has been exactly what these words say. The preceding words of the Section state that the practice shall continue to be what it has always been. Accordingly, if these words make no change in the practice, why are they necessary? That is a very simple question. Will the Solicitor-General point out to the Committee what change would be made in the existing practice if these words were omitted? When we find that tire preceding words of the Section distinctly state that the present practice is to continue, and then this additional provision is put in, it is natural to suppose that this additional provision has an additional meaning. The Solicitor-General says it has no additional meaning, but leaves the law exactly as it was. In that case I submit it is wholly unnecessary, and we laymen learn in this House from learned Gentlemen that unnecessary words in a statute are always bad and ought to come out.

I do not know whether the right hon. Gentleman expects me to jump up after every speech without waiting to weigh the value of the speeches. I have been endeavouring to gather their effect, and, of course, I never intended to let the matter remain without explanation, if explanation was necessary. I want to make it plain what the law is and what the practice has been. Since 1880 the existing duties have never been deducted in the ascertainment of the annual value. That, therefore, we may assume to be the law. It never has been challenged, but everyone can see that it may be desired to challenge that practice because the duties have been increased. There is reason, therefore, why it should be made perfectly clear. Let me give a case to show how dangerous it would be to leave out these words if it could be shown by any court that the practice has been a wrongful practice. It does not matter whether the practice has prevailed for 20 or 30 years; a court of law may still declare that the practice has been against the law. Supposing the annual value of the premises, taking everything into consideration, has been fixed by the Commissioners at £100. According to the law, as it will be when this Bill passes, the duty will be £50. When that annual value has been ascertained you cannot deduct the £50 duty from it and say that the annual value has been reduced from £100 to £50. It is abundantly clear that it is necessary from the point of view of caution to put these words in, lest by reason of the increased duty to be placed upon the licence a test case may go to the Courts, and the Courts may decide that the practice has not been in accordance with the law. We think it has been in accordance with the law, but, at any rate, we want to perpetuate the practice beyond any question by the insertion of these words.

May I put a question to the Solicitor-General to make the matter-clear, at any rate, to my mind? Of course these licensed houses are valued for the purpose of rates and also for the purpose of the Licence Duty. Are there to be two annual valuations or not? For the purpose of rateable value certain deductions are made, but first they arrive at the annual value. I want to know whether the Government are setting up, for the purpose of levying the publican's licence-duty, a new or special gross valuation?

The hon. and learned Gentleman suggests that it is to be done in exactly the same way as for the gross, annual value for rates.

I never said anything of the kind. The annual value has to be ascertained for the duty in precisely the same way as the annual value has been ascertained for the purpose of the existing duty.

Of course you make certain deductions to get the rateable value, but,, in getting at your annual value for rates, in order to make your deductions afterwards, you will of course take into account what the Licence Duties are, and obviously, if those duties are going to be higher, the gross annual value from which you are going to make your deductions will be very much altered, and, of course, very much lower. For the purpose of ascertain- ing the gross annual value on which you are going to levy the publican's Licence Duty, presumably in the same way the gross annual value would be very much less. It is not technically a deduction, although I suppose it comes in some ways very much to the same thing, because you ask what a man would give for it. But is it to be a new method, or is it to be arrived at in exactly the same way as the gross annual value is arrived at for the purpose of levying a rate? I confess, after the explanation of the Solicitor-General, I still do not feel clear as to what is the precise meaning or the value of the words inserted in the Section.

As the result of the Amendment of the hon. Member below the Gangway the words we are now discussing will have no effect in Ireland.

I hesitate to express a contrary opinion, but so far as I can understand the Amendment, the result will be that in England and Scotland the duty will be taken into account, whereas in Ireland it will not be.

I presume the primary purpose of valuation in England as well as in Ireland is for the purpose of rates, and your licensing valuation, Income Tax valuation, and so on, are taken upon that valuation. I have never read the English Valuation Act, but I have read the Irish Valuation Act, and it is substantially what, allowing fair wear and tear, and even deduction for insurance, a place would let to a tenant from year to year. I suppose, roughly speaking, that is also the plan for England. If the basis of valuation be letting value, I wish to ask, is there a tenant in England, Ireland, or Scotland, who, when he is taking or making a letting, will not take into account the question of rates and taxes? Therefore, the question here will be for English Members to ascertain what is the basis of the English rating system. I do not know it; but I do know the basis of the Irish system and, therefore, I stay it is making a change in the law. The hon. and learned Gentleman the Solicitor-General made one very important admission. He said since 1880 this must be assumed to be the law, because it has never been chal- lenged. Why has it never been challenged? Because it was never worth while for a man to enter into a lawsuit with the Crown for £3 10s. But now it may be a matter of £300 or £400. The English brewers and holders of licences might easily make a pool and light the Crown and, therefore, the Government have to put in these words so as to prevent that course being adopted to see whether the basis is practical or not. In Ireland I think there is a change in the law. All the Excise authorities do in Ireland is to look at a man's valuation, and that was imposed by Griffiths, who is now posing in his grave. It is admitted now that as regards Ireland a change in the law is being made. What is the consequence of that change? Why, you are arranging that practically a new valuation in Ireland may be made as a consequence of the passing of this Act. I think my hon. and learned Friend is giving us a concession with one hand and he is taking it away with the other, because he is saying that in future this deduction shall not be taken into account. This I say is bringing about an absolute change in the law in regard to Ireland. Can any Christian say that it is not? The basis is that all taxes and charges are to be paid by the tenant. I therefore respectfully maintain that you are now making a new law, after having accepted valuation on the preceding lines, and after having made a compact with my Irish Friends, many of whom have gone home to bed. You give them, I say, a concession with the one hand and you take it from them with the other.

2.0 A.M.

I think we are not quite clear about this Clause. I think we have a right to expect from the learned Solicitor-General that he will make it quite clear before we go to a Division. Does the Solicitor-General mean that there will be two systems of rating? Does he mean that there will be the ordinary system in which you have to go to the assessment committee and then to quarter sessions, and then you will get your basis of rating on the judgment of those authorities? You cannot dictate to the quarter sessions nor to the assessment committee, and the assessment committee will undoubtedly take into consideration all the circumstances in connection with the property. It seems to me there will be two assessments—one for licensing purposes and the other for rating purposes. The one for rating purposes will be an honest assessment. The other one will be the dishonest assessment, based upon an addition of a rent charge which had been established on the property in order to raise the amount which the Government are to exact. This is a perfectly clear point. It has been taken up by all the municipalities. They are perfectly clear in the knowledge of the fact that this, which I may call a rent charge, now put on all property in the Kingdom which is held under licence, is going to reduce the assessment which quarter sessions will allow to such an extent that they will put a very heavy burden on the ratepayers. That is perfectly clear. There will be a deduction of something like £4,000,000 from the rateable value of the property in the United Kingdom, and an addition of that amount to the burdens of the other ratepayers. The Exchequer will get the benefit of the £4,000,000. The Government say they will not accept the

judgment of quarter sessions for the purposes of these licences, and are going to add the £4,000,000 to the charges. When quarter sessions have fixed a proper value for the assessments of the houses the Government say, "I will have my £4,000,000, and on that I will base the amount of the Licence Duty I am going to exact." Is that fair or honest? Surely the Government must know their own minds. I see the learned Solicitor-General poring over papers—

I am sorry that what I have said is treated with such discourtesy. That being so, I beg to move, "That the Chairman do report Progress, and ask leave to sit again."

Question put, "That the Chairman do report Progress, and ask leave to sit again."

The Committee divided: Ayes, 79; Noes, 126.

Question put, "That the words 'and in the determination of that value the duty on the licence is not to be allowed as a deduction,' stand part of the Clause."

The Committee divided: Ayes, 126; Noes, 78.

proposed, at the end of Sub-section (1), to insert the words "but the Commissioners of Customs and Excise shall allow as a deduction so much of the annual value of the said premises which are used for any business or purpose distinct from and independent of the use of the premises for the sale of intoxicating liquors."

The Amendment which was discussed a little while ago covered most of the arguments which could be adduced on this point, and, therefore, I need not detain the Committee at any length. I should like to say at the outset that my Amendment meets very largely the objection the Solicitor-General raised against the previous Amendment. In answer to a question the other day the Chancellor of the Exchequer said that where a portion of properties was sublet, then the sublet portion would not come under the purview of the Revenue authorities for taxation as licensed premises. What I should like to emphasise is that it would be very hard if, when some person happens to occupy two portions of a property, that he or she should be in a worse position than another person who has happened to sublet. The Solicitor-General said the only portion on which it was wished to levy the charge was that portion licensed by the justices. If anybody who has a property such as I have alluded to went to the justices and asked for a licence only for that part of the premises used for purposes of the trade, would he expect to get it? The principle of the Act of 1880, said the Solicitor-General, was adopted here. But the principle of the Act of 1869, which made beer-houses pay only £3 10s. was not adopted here. The view I wish to place before the Committee is that in future if the whole hereditament is to be subject to paying one-third of the annual value the position will be very acute. I hope the Government will see their way to accept the Amendment, which only carries out the principle accepted by the Prime Minister last night in connection with Ireland.

My hon. Friend said, and said rightly, that there is a distinction between the Amendment which he now proposes and the one proposed earlier in the evening by the hon. Baronet the Member for the City of London (Sir Frederick Banbury). The law at present is, I think, perfectly clear. We do not propose to alter the law at all. We propose to allow it to remain as it has been certainly since 1880. But in answer to the specific question put to me, I may say that I think it would certainly be competent on the justices, upon an application being made to them, to say that a part of the premises used distinctly and independently from the intoxicating liquor business is not included in the licensed premises. If the justices did say that, it is perfectly clear that the Commissioners of Inland Revenue, in making their valuation, would not go outside the licensed premises as defined by the licensing justices.

I am not at all satisfied as to the point on which the Solicitor-General has just expressed his opinion. I venture to suggest that the object might be obtained if the Amendment were made to read. "But the Commissioners of Customs and Excise shall allow as a deduction so much of the annual value of the said premises as are stated, or certified, by the justices to be used for any business or purposes distinct from, and independent of, etc." I would point out that if the Amendment were accepted in the form which I suggest, it would make certain that which I understand the Solicitor-General desires shall be the law. If it is not accepted in that form there is no such guarantee, and when the Solicitor-General says that nothing is provided here that is not already law, of course the observation which at once suggests itself is that we have here a very large addition indeed to the existing burdens, and, therefore, it may be very reasonable to insist, so far as one can, that the way-weight of these

burdens shall be mitigated by seeing that they attach only to that part of the premises actually used for licensed purposes. I do not understand why the Solicitor-General should object to accepting the Amendment, and if what I suggest were done the object with which the right hon. Gentleman declares himself sympathetic would be secured beyond all doubt. In answer to a question a few weeks ago the Chancellor of the Exchequer distinctly indicated that he recognised the reasonableness of making a deduction in the case where there was a letting. It is impossible for anyone to suggest that there is any distinction at all between the case of a letting and the case of ordinary usage for a purpose unconnected with licensed premises.

Question put, "That those words be there inserted."

The Committee divided: Ayes, 71; Noes, 120.

moved to leave out Sub-section (2).

Question proposed, "That the words proposed to be left out stand part of the Clause."

Committee report Progress; to sit again to-morrow (Friday).

Adjournment, — Resolved, That this House do now adjourn.—[ Mr. Joseph Pease. ]

Adjourned accordingly at Twenty-six minutes before Three o'clock.