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Commons Chamber

Volume 11: debated on Thursday 23 September 1909

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House Of Commons

Thursday, 23rd September, 1909.

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

Private Business

Hamilton Burgh Order Confirmation Bill [ Lords]—Considered; to be read the third time upon Monday next.

United Kingdom

Trade, Commerce, And Condition Of People

Return ordered "for the United Kingdom for each of the years 1831, 1841, 1851, 1861, 1871, 1881, 1891, 1901, 1906, 1907, and 1908, showing the following particulars as far as available: (1) Population (millions); (2) death rate per thousand; (3) birth rate per thousand; (4) paupers, total average number, indoor and outdoor; (5) number of paupers per 10,000 of the population; (6) total cost of poor relief; (7) net passenger movement outwards to places out of Europe; (8) average 'Gazette' price per quarter of wheat, barley, and oats; (9) average price of beef at the Metropolitan Cattle Market; (10) total value of the imports of grain, corn, and flour; (11) total value of the imports of meat, alive and dead; (12) total value of the imports of food and drink (exclusive of tobacco); (13) total value of the imports of food and drink (exclusive of tobacco) from British Colonies and possessions; (14) total value of the imports of food and drink (exclusive of tobacco) per head of population; (15) total quantity of home-grown and imported wheat and wheat-flour retained for home consumption; (16) consumption of wheat and wheat-flour per head of population; (17) value of fish of British taking landed on the coasts of the United Kingdom; (18) net imports of merchandise (deducting re-exports), total value and value per head of population; (19) exports of the produce and manufactures of the United Kingdom, total value and value per head of population; (20) imports of bullion and specie; (21) exports of bullion and specie; (22) Income Tax, yield of each penny; (23) gross income brought under Income Tax; (24) amount standing to credit of depositors

in Post Office and Trustee Savings Banks; (25) consumption of pig-iron per head of population; (26) total registered tonnage of British shipping; (27) tonnage of British shipping entered and cleared in the foreign trade at ports in the United Kingdom; (28) tonnage of foreign shipping entered and cleared in the foreign trade at ports in the United Kingdom; and (29) total clearings at the London Bankers' Clearing House (in continuation of Parliamentary Paper No. 294 of Session 1907)."—[ Mr. Essex.]

Oral Answers To Questions

Old Age Pensions (Census Evidence Of Age)

asked the Chief Secretary for Ireland what evidence is regarded as sufficient to establish a claim for an old age pension; whether any evidence independent of the Census of 1841 or that of 1851 is considered adequate to that purpose; and would the testimony of persons of good standing in the district of the applicant be accepted in support of such claim?

If the hon. Member refers to the last Annual Report of the Local Government Board, which was presented to Parliament on 10th August this year, he will find at pages 11 and 12 of the Report a statement of the practice of the Local Government Board in relation to evidence of age on the hearing of pension appeals. The testimony of any person in a position to give reliable evidence of a claimant's age would be admissible in support of a claim.

Why does the Local Government Board not receive testimony that the applicants are over 70 years of age?

The evidence of any person who is in a position to give reliable evidence will be acceptable.

Is the hon. and learned Gentleman aware that the rules of evidence in regard to age in these cases are quite different from those in courts of justice?

In a case where there is variance between the recommendation of the pension officer and the pension committee, in view of the highly representative character of the pensions committee, would their recommendation be accepted in preference to that of the pension officer?

The hon. Member must be aware that the Local Government Board consider the matter on their own responsibility.

If a sworn deposition is made as to the probable age of an applicant by a reliable authority, will it not be accepted by the Local Government Board?

The Local Government Board are themselves made the judges of what is satisfactory evidence, and the responsibility must be left to them.

Emergency Men (Ireland)

asked the Chief Secretary for Ireland if he will say on whose instructions emergency men in the service of ranchers in Ireland are allowed by the police to misconduct themselves with impunity; why the Rathowen police have not prosecuted Peter Lacy for assaulting his employer, Christopher Taaffe, J.P., though they found it necessary to protect Taaffe from Lacy; why the police have not prosecuted Nash, emergency man to Harry Bond, J.P., for firing with an unlicensed gun several shots in the village of Ballinalack on 25th August last, and for firing one shot in the house of John Smith, whose wife was then sick in her confinement; and whether he will have those emergency men removed from a district peaceful but for them, and bring under the notice of the Lord Chancellor of Ireland the action of the two magistrates mentioned?

There is no foundation for the statement in the first paragraph of the question, and the constabulary authorities tell me that the hon. Member is misinformed as regards the particular cases to which the refers in support of that statement. No complaint was ever made to them that Lacy had assaulted his employer, and the allegation that Nash, who is a gamekeeper, had fired shots on the public road was found, on inquiry, to be groundless. Nothing is known to the police as to his having fired a shot in the house of John Smith.

Hankow-Canton Railway

asked the Secretary of State for Foreign Affairs whether he will state the steps, if any, taken by the British Government subsequently to the undertaking given in 1905 by Chang-Chi-Tung in consideration of the loan of £1,100,000, and prior to the acquisition of the Hankow-Canton Railway line by the Germans in the spring of this year, to secure that line for England in accordance with the undertaking; if the terms of the international combination for the construction of this railway are now concluded; whether one portion is to be built by German and American engineers jointly, and another by French and English engineers jointly; in what proportions is the mileage to be thus or otherwise divided; whether the portion recovered from the Germans has been recovered on the same terms on which the Germans had obtained it from the Chinese; whether he is aware that the Chinese have always preferred an Anglo-American combination, to give them what they called English roads and American rolling stock; and if he will say on what point and through whose fault, if any, the negotiations with that object failed?

As I informed the hon. Member on the 2nd instant, negotiations in regard to the Hankow-Canton Railway have proceeded continuously from the year 1905 until the spring of 1909. No agreement has yet been concluded, and as negotiations are still proceeding I am unable to add anything further.

Kilo Gold Mines (Forced Labour)

asked the Secretary of State for Foreign Affairs whether he is aware that the Kilo gold mines, in Belgian territory, west of Lake Albert, are being worked by forced labour from the surrounding country; and, if so, what steps he proposes to take?

My information is to the effect that the Kilo mines are being worked by free labour.

Alleged Murder By Constable (Kiukiang)

asked the Secretary of State for Foreign Affairs whether it is in accordance with consular practice, when a native is accused of killing a British subject and when a British subject is accused of killing a native, respectively, to hold the preliminary magisterial inquiry incamera; whether it was with his approval all hearing of the charge against Constable John Mears of having killed Yu-Fa-Cheng, at Kiukiang, last April, was refused for three months, until an extensive trade boycott rendered some sort of inquiry necessary; whether he is aware that at length Consul-Judge Werner heard the charge in camera and suppressed the evidence, that the doctor attached to the British consulate admitted having heard Mears say he had given a poke to Yu-Fa-Cheng, and that the latter died from internal hemorrhage a few hours later; that this ecidence was corroborated by other witnesses, including two American citizens; that the Consul accepted all the evidence for the defence, rejected all for the prosecution, did not allow Mears to be called or questioned before him, spoke of the admitted poke as an imaginary blow, and refused to allow the case to go before the British Supreme Court of Shanghai; and whether he will allow the case to go before the British Supreme Court of Shanghai, or lay upon the Table of this House a copy of the evidence given before the Consul?

No information has been received from His Majesty's Minister at Peking in regard to the incident referred to by the hon. Member. Sir John Jordan will furnish a report on the matter in due course.

British Law In China

asked the Secretary of State for Foreign Affairs whether the Prevention of Corruption Act, 1906, and the other statutes in force for the prevention and punishment of corruption, so far as applicable in a foreign country, are included in the laws of Great Britain which British consuls are commissioned to administer among British subjects in China; and, if so, whether he will have copies of the applicable portions of those statutes circulated by the British Legation and consulates in China?

It is the custom in His Majesty's Extra-territorial Courts abroad to apply statutes of the Imperial Parliament, so far as the nature of the provisions and the circumstances of the case allow. Copies of the statutes can always be obtained by His Majesty's Legation and Consulates in China.

Is the right hon. Gentleman aware that people who violate the statutes do not want copies?

But it is not the people who violate the statutes to whom copies are to be supplied.

Cotton (Contraband Of War)

asked the Secretary of State for Foreign Affairs, whether he can state the manufactured condition of the cotton recently declared to be contraband of war by the Russian court of appeal?

English Channel Fisheries (International Convention)

asked whether there is now any nearer possibility of the conclusion of an International Convention in connection with the fisheries of the English Channel upon the lines of that in force since 1884 in connection with the North Sea fisheries?

There is at present no question of an International Convention on the lines indicated in the question; but His Majesty's Government are in communication with the French Government with a view to the conclusion of a Convention with France for the regulation of the Channel Fisheries.

Torture Of Political Prisoners (Morocco)

asked whether the representations made by the British and foreign consuls to the authorities of Morocco have had any effect in stopping the tortures inflicted on political prisoners in that country; and, if not, what action does His Majesty's Government propose to take in this matter?

No case of the torture of prisoners has been brought to the knowledge of His Majesty's Government since the date of the representations referred to.

Is the right hon. Gentleman not aware that a man has been killed in prison since? Has he not used the ordinary means of communication?

Having regard to the existence of these tortures, does the right hon. Gentleman consider it right and proper that close relationship should still be maintained with this foreign Government?

The action taken in this case was collective action by the Powers, and any farther steps will presumably have to be taken in concert. I cannot make any statement.

Display Of Flags At Public Houses (Ireland)

asked the Chief Secretary for Ireland whether he is aware that Sergeant Carrigan, of the Royal Irish Constabulary, on last Saturday evening ordered Mr. Mark M'Cormack, a licensed publican in the town of Castlerea, to remove a flag bearing the stars and stripes which he had hung out upon his house to honour two American citizens who were visiting the town; whether any other publicans in the town, all of whom displayed flags, were similarly instructed; whether Sergeant Carrigan, in taking this action, was acting under instructions from the Government; whether he is aware that, upon the refusal of Mr. M'Cormack to remove the flag, he was informed that the renewal of his licence would be opposed; and whether the Government intend to carry out this threat of the police?

I am informed that Sergeant Carrigan did call the attention of the publican in question to the fact that it was a breach of the Licensing Acts to display any flag from his licensed premises except the accustomed sign of the house. In doing so, I understand that the sergeant acted on his own initiative, the law being quite clear that any such display is an offence under the licensing code. The sergeant did not inform the publican that the renewal of his licence would be opposed if he refused to remove the flag. No communication was made by the police to the two other publicans in the town who displayed flags.

Is not the Act of Parliament dealing with the display of flags an Act dealing with illegal and secret societies, and is it not a fact that in Dublin every day of the week the large hotels and public-houses display flags, and the police take no action, and is it not the fact that in this case the action of the sergeant is based on the allegation that the United States flag was a party emblem?

May I ask whether it would be illegal for a publican in Ireland to fly the Union Jack?

That is a hypothetical question. The hon. Member should give notice of it.

May I ask the Solicitor-General whether the police authorities at headquarters have issued any orders all over Ireland that flags are not to be displayed, and, if so, whether he can explain the fact that hotels in Dublin are allowed to fly flags in contravention of the law, while publicans in small towns are visited with pains and penalties? Will the hon. Gentleman explain why there is a distinction?

I am not aware of the existence of any general Regulation on the matter. The Act of Parliament is perfectly distinct.

In view of the fact that the act of this policeman is likely to be regarded as an insult to a great and friendly Power, does the hon. Gentleman propose to offer any explanation that this act was done by one of the Royal Irish Constabulary, and that though he is an officer of the British Government, you are not able to deal with him?

Glin District (Fair Rent Application)

asked the Chief Secretary to the Lord Lieutenant of Ireland if he can say when the Land Commission will sit in Listowel, county Kerry, to hear fair rent applications between landlords and tenants; and whether they will take the cases listed for Glin district, which is convenient to Listowel, in order to have them promptly dealt with?

I am informed by the Land Commission that a sitting of a Sub-commission was held at Listowel on the 15th instant, and that all applications from the rural district of Listowel, county Kerry, pending on 31st August last were set down for hearing at that sitting. The list did not contain any cases from the rural district of Glin, which is in a different county, and no date has yet been fixed for a sitting to hear cases from that district. There is only one such case pending.

Old Age Pension (Croagh, County Limerick)

asked the Chief Secretary to the Lord Lieutenant of Ireland if he can say on what ground the Local Government Board (Ireland) stopped the old age pension of 3s. a week to Mrs. Ellen Shanahan, of Lisnamuck, Croagh, in the county of Limerick (No. in Sub-Committee Register 144, No. in Pension Officer's Register 683); is he aware that she was not satisfied with the amount, as she considered her board and lodging in her son's house was only value for £12 per year, the amount she was to receive under his marriage settlement, made over four years ago, in case she disagreed with him; and is he aware that she raised the question with the pension officer, who reported that she was not entitled to 5s. a week, and, on appeal to the Local Government Board, they decided that she was not entitled to any pension; and, having regard to these facts, will he direct them to grant her the pension of 5s. per week?

The Local Government Board upheld the appeal of the pension officer on the ground that the Board considered that Mrs. Shanahan's support and maintenance, in the circumstances, was worth more than £31 10s. a year. My right hon. Friend the Chief Secretary has no authority to give the direction indicated in the hon. Member's question.

Coole District, Westmeath (Untenanted Land)

asked the Chief Secretary to the Lord Lieutenant of Ireland whether he is aware that the Estates Commissioners have received during the last few years a number of letters and memorials from and on behalf of congests in Coole rural district, Westmeath, asking the Commissioners to purchase some of the untenanted and non-residential land in that district for relief of the congestion, and that the Commissioners have, so far as is known, inquired only regarding the Gradwell estate, three years ago, and none since; if he can say when inquiry will be made in the other cases brought under their notice or an inspector be sent to the district; and, in the latter case, will anyone, on behalf of the congests, be given notice in advance?

The Estates Commissioners are unable from the particulars given in the question to identify the lands referred to as pending for sale before them. If the hon. Member will state the names of the estates on which the lands are situate further inquiry will be made.

Press Law In India

asked the Under-Secretary of State for India whether he has received any official Reports from the Government of India to the effect that a bomb had been thrown at a train in Eastern Bengal with the object of securing £90,000, which was known to be aboard the train, to be used in furtherance of the Anarchist cause; that the three natives in charge of the treasure showed great courage, pulled the communication cord, and refused to leave the treasure van, which was shattered; and that the bomb used was one of an extremely high explosive power; and, if not, whether the Government of India are taking any, and, if any, what steps, under the Press Law or otherwise, to put an end to the transmission of such unfounded statements?

had given notice of the following question on the same subject: To ask the Under-Secretary of State for India whether he has received any official information that on Wednesday last a bomb was thrown at a train on the Eastern Bengal Railway, which is alleged to have shattered the treasury van, and that the crime was probably committed by political dacoits to gather funds for the Anarchist cause?

The hon. Member for Newbury has also a question on the subject, which I will answer at the same time. The Secretary of State has no official knowledge of the report referred to; and with regard to the last part of the question of the hon. Member for Merthyr, I would remind him that Reuter's message was apparently a bonâ fide report based on the statements made by the Indians in charge of the van. The Government can scarcely undertake to deal with every unfounded statement in the Press that forms the basis of questions on India in this House.

May I ask what authority the Under-Secretary has for saying that this unfounded report was based upon statements made by those in charge of the van?

We have no official information at the India Office, and the only report I have seen is Renter's telegram.

May I ask whether, in view of the strict interpretation of the law applied to the native Press in regard to reports concerning Europeans, the India Office will consider the advisability of applying this law to unfounded reports that cause bitter irritation when referring to natives?

Will the hon. Gentleman ask the Secretary of State to take steps to deport some of the members of this brigade of liars?

Transvaal Mines (Death Rates Of Workers)

asked the Under-Secretary of State for the Colonies what were the average number of Chinese, African natives, and white men, respectively, employed in the Transvaal mines in the months of June in the years 1907, 1908, and 1909; and what were the average rates of mortality of the Chinese and African natives, respectively, in each of those periods?

The general statistics of mortality furnished to the Secretary of State are for periods of three months, and the figures for the three months ending 30th June, 1909, have not yet been received. The figures for the quarter ending 31st March, 1907, 1908, 1909, respectively, are available, and if the hon. Gentleman will permit me I will circulate them with the Votes.

May I ask the hon. and gallant Member whether he can give us the figures in regard to the whites in the periods named?

The figures in regard to the whites were given, I think, in answer to a question put a few days ago by the hon. Member for Gravesend, but if that is not so I will include them also.

asked the Under-Secretary of State for the Colonies what is the total number of deaths that have occurred since 1st January, 1906, among the Chinese and Kaffirs, respectively, employed in the mines in the Transvaal; and if he can state how many of the deaths of the Kaffirs must be attributed to the substitution of Kaffirs for Chinese since that date?

The total number of deaths from all causes between 1st January, 1906, and 31st March, 1909 (the latest date for which full statistics are available) is, Chinese 2,142, natives 15,973. As regards the second part of the hon. Gentleman's question, I can only refer him to what passed as a result of a similar question by the Noble Lord the Member for East Marylebone on 24th June, 1908.

Is there any reason to believe that the gritty substance in the mines has a more injurious effect on the natives than on the Chinese; and, if so, whether he will take steps to have the gritty substance removed by water or otherwise from the atmosphere of the mines?

I am afraid I am not able to state in what different degrees the gritty substance affects different races.

British Guiana Executive Council (Labour Representation)

asked the Under-Secretary of State for the Colonies whether, on the occasion of the next vacancy on the Executive Council for British Guiana, favourable consideration will be given to the appointment of a representative of labour, which is at present unrepresented?

The Secretary of State will consult the Governor as to my hon. Friend's suggestion.

Indentured Coolie Labour (West Indies)

asked the Under-Secretary of State for the Colonies if he is aware that on 28th August of this year the steamship "Mitlah" arrived at Port-of-Spain from India with 817 indentured coolie immigrants; that the expense per immigrant was £27, of which sum the planters requiring such labour would only contribute some £5 per head; whether he is aware that in the same month at Pont-of-Spain some 300 unemployed natives and colonists asked for an interview with the Governor, Sir George Le Hunte, pointing out their destitute condition, and offering to emigrate; and, if so, whether, in view of the number of unemployed, he is prepared to take any action in regard to restricting such importations?

The Secretary of State has been informed of the arrival of the steamship "Mitlah" at Port-of-Spain with the number of immigrants mentioned in the question. He has not received any information bearing on my hon. Friend's further inquiries, but the Governor will be requested to furnish a report in regard to them.

Transvaal Mines

asked the Under-Secretary of State for the Colonies whether he can state the number of white workmen now employed on, in, or about the Transvaal mines; and the proportion of British subjects amongst the same?

The number employed on mines in the Transvaal in July was 23,755, of whom 22,021 were employed on gold mines. The Secretary of State has no information as to the proportion of British subjects. I will endeavour to obtain the information.

asked the Under-Secretary of State for the Colonies whether he can state the number of Europeans employed in the Transvaal mines during the period when the maximum number of indentured Chinese labourers were so employed, and the numbers of Europeans and coloured labour, respectively, so employed at the latest date up to which statistics are available?

In January, 1907, when the maximum number of Chinese were employed, the number of whites employed on the Transvaal gold mines was 17,874, the number of Chinese being 53,856 and of natives 102,477. The figures for July last are: Whites, 22,021; Chinese, 5,360; natives, 171,100.

Can the hon. Gentleman say when the last of the Chinese are going to disappear?

Very soon. In January the contracts expire, and within a very short time after that they will be gone.

Post Office And Wireless Telegraphy

asked the Postmaster-General if he is proposing to buy the Marconi wireless telegraph stations, and, if so, at what price; if a trans-Atlantic wireless station could be erected for £15,000 or less, and an ordinary shore-to-ship station for £3,000; if he is aware that there are several other methods of wireless telegraphy, the inventors of which allege that messages can be sent more rapidly, with greater reliability, and to greater distances than by the Marconi system; and whether, seeing that the science of wireless telegraphy is still comparatively in its infancy, he will take care that there is no interference with perfectly free competition between the various systems?

I am in negotiation with the Marconi Company and with Lloyd's in regard to the matter. I hope to be able to come to an arrangement satisfactory to the Post Office. If, and when, the arrangement is concluded, I propose to make a statement in the House in regard to it. It would be premature to do so now. As regards the last paragraph of the question, however, I can at once give the desired assurance.

Lady Clerks, Postal Order Issue Department

asked the Secretary to the Treasury whether the lady clerks working at the Postal Order Issue Department, Somerset House, have to pass an examination before appointment; and if he can state how these lady clerks are selected for appointment?

These appointments are filled by candidates nominated by the Commissioners of Inland Revenue to compete at an examination held by the Civil Service Commissioners.

Has the right hon. Gentleman not seen a report in the paper to the effect that the daughters of officials are employed in Somerset House?

Government Contracts (Fair Wages Clause)

asked the Secretary to the Treasury whether he is aware that Messrs. Houghton and Company, Walthamstow, are contractors to various Government Departments, and that the firm in question are violating the Fair Wages Clause Resolution of the House of Commons in regard to wages and overtime rates; and if he is prepared to have a Committee of Inquiry into the matter?

If the hon. Member will furnish me with particulars of the alleged violation of the Resolution, I will communicate with the Department or Departments to whom Messrs. Houghton are contractors, and inquiry will no doubt be made. I see no necessity for a special Committee of Inquiry, as the existing machinery for investigating such complaints appears to be sufficient.

Finance Bill

Motor Cars (Horse-Power)

asked the Secretary to the Treasury if he can now give to the House the method of calculation which will be adopted by his Department for arrriving at the units of horse-power of motor cars under Section 66 (2) of the Finance Bill; and will he, in view of the fact that this Clause is to be considered this week, say whether the unit is to be makers' nominal horse-power or that of the Royal Automobile Club formula?

The precise method of calculating the horse-power of motor cars for the purposes of Clause 66 of the Finance Bill will, in accordance with Subsection (2) of that Clause, be laid down by Regulations to be framed by the Treasury after the Bill has become law. The draft of the proposed Regulations is now under consideration, but I am not in a position to add anything to the statement made by my right hon. Friend in his Budget speech, except that the calculation will be based on the power which a car is actually capable of developing and not upon any purely nominal rating. The Treasury Regulations will be laid before Parliament in due course.

Will the Treasury see that whatever standard is adopted the owners of cars, banâ fide believing that there is a certain horse-power in their cars, will not have their rating increased for the purposes of taxation?

It is quite impossible to give that assurance off-hand. I will endeavour to see what can be done.

Is the right hon. Gentleman aware that without this definition these taxes cannot be considered properly by this House?

Import Duties

asked the Chancellor of the Exchequer whether it is intended to provide in the Finance Bill for an import duty on goods manufactured from fire-clay in Germany, and which are used in the construction of German patent coke ovens in this country, such goods displacing similar articles made in Great Britain, upon the materials of which it is proposed to place a tax by the imposition of a duty on royalties?

May I ask the right hon. Gentleman whether it is considered advisable to place an import duty on beer manufactured in Germany coming into competition—

Duty On Minerals

asked the Chancellor of the Exchequer whether taxation is now being levied in accordance with the terms of the Budget Resolutions or in accordance with the terms of the Finance Bill; has any duty been levied upon ungotten minerals or upon gifts made within five years of death; if so, will the amounts so overpaid be returned to those who have paid them; and, in that case, will he state when and in what manner these repayments will be made?

Taxes have been collected under the authority of the Budget Resolutions, and in accordance with the terms of the Finance Bill, only in the ordinary cases where the immediate collection of the duties is necessary in order to safeguard the interests of the Revenue. No duties have been collected on ungotten minerals or in respect of the special provision as to gifts made within five years of death. The question of repayment, therefore, does not arise.

Value Of Land (United Kingdom)

asked the Chancellor of the Exchequer whether he can state the approximate amount which would be required, upon the basis of present market value, to acquire by purchase on behalf of the State the whole of the land of the United Kingdom?

My right hon. Friend hopes to be in a position to furnish this information to the hon. Member when the valuation proposed by the Finance Bill has been duly completed.

Estate Duty (Ireland)

asked the Chancellor of the Exchequer whether he is aware that Estate Duty is at present being claimed in respect of the tenant-right interest of persons who have died in Ireland since 30th April last; and whether he will give directions that such a claim is not to be made?

Instructions have already been issued to limit the value for Estate Duty of tenant-right in the manner indicated in my right hon. Friend's statement to the Committee on the 13th instant.

Would the right hon. Gentleman say when the instructions were given? Within the past few days I have seen the Schedule on which the demand was made.

Thornliebank Stabbing Case

asked the Lord Advocate, whether he can see his way clear to revise the sentence passed on J. W. M'Ewan, who received six months' imprisonment for attempting to stab the under-manager of the Print-field, at Thornliebank, under provocation, and in consequence of extraneous matter introduced by the prosecutor at the trial?

I have nothing to add to the reply given to the hon. Member for East Renfrew on 14th September to the effect that the Secretary for Scotland sees no sufficient reason for advising any remission. I cannot admit the implication suggested in the concluding words of the question.

Railway Carriers (Hours Of Work)

asked the President of the Board of Trade whether his attention has been called to the case of a van guard at Marylebone, employed by Messrs. Thompson, M'Kay, and Co., carters for the Great Central Railway Company, who is under 15 years of age, being employed for 15 hours and 45 minutes on 31st August last; whether he proposes to take any action in the matter; and whether he proposes to amend the Railway Hours Act, 1893, with a view to bringing boy labour under its scope?

also asked the President of the Board of Trade whether his attention has been called to the case of a carman employed by Messrs. Thompson, M'Kay, and Company, at Marylebone, who was on duty on 6th September for 16 hours 45 minutes, less meal times, on 7th September 16 hours, on 8th September 15 hours 30 minutes, on 0th September 13 hours, on 10th September 13 hours 45 minutes, and on 11th September 11 hours 30 minutes, a total of 86 hours 30 minutes for six days; whether he proposes to take any action in this case; and whether he will consider the advisability of including carmen in an amended Railway Hours Act?

I will answer the hon. Gentleman's two questions together. The employés referred to appear from the question not to be in the service of a railway company, and I have no information with regard to their hours of work. As the hon. Member is aware, the operation of the Railway Regulation Act, 1893, is confined to railway employés, including boys, engaged in working the traffic on the lines of a railway company. As regards future legislation, I shall be happy to consider any suggestions which the hon. Member may make, but he will appreciate the difficulty of extending the Act to one particular class of carmen not in the employ of railway companies.

Asiatics On Steamships (Conditions Of Work)

asked the President of the Board of Trade whether his attention has been called to the death at sea from heart failure, on 15th March, 1909, of an Asiatic coal trimmer named Goolan Hossein Cassum, aged 17, whilst serving on the steamer "Knight Templar," of Liverpool; whether the seaman was medically examined before joining; how long he had served on the vessel; whether he had any previous sea service; whether he was on duty at the time; what was the temperature of the engine-room; how much coal the engine-room hands were required to work each 24 hours; what were the respective ages of the other coal trimmers employed; whether the engineer's log-book has been produced to the Board of Trade surveyors; and whether any previous cases of death from heart failure, heat-stroke, suicide, supposed suicide, or disappearance have occurred on this vessel?

Yes, Sir. The coal-trimmer boy referred to in the question died of heart failure six days after leaving Cardiff on a return voyage to Bombay. He was medically examined before joining and had been on the vessel three months and nineteen days, but I am not aware whether he had had any previous sea service. At the time of his death he had been off duty since noon on the previous day. The temperature of the engine-room on the day before he died was 80 degrees, of the stokehold 94 degrees, and of the bunkers 78 degrees Fahr. The owners state that the coal consumption was 34 tons 10 cwt. per day, and that the vessel carried 23 firemen and trimmers. I have no information as to the ages of the other coal trimmers. The engineer's log-book has not yet been produced to the Board of Trade surveyors, and they have not yet had an opportunity of visiting the vessel since the boy's decease, but full inquiries will be made in the case on the vessel's return to this country, and the result communicated to my hon. Friend. Two other deaths from heart trouble, one from cardiac failure following influenza, and the other from heart disease and dropsy, have occurred among members of the crew of this vessel during the last three years, but no cases of death from heat-stroke, suicide, supposed suicide, or of disappearance during that period have been reported.

Has any complaint been made by or on behalf of any of the Asiatic seamen referred to in the questions?

Will the right hon. Gentleman inquire whether any complaints are made in respect of the ships and shipowners to which and to whom reference has been made?

asked the President of the Board of Trade whether his attention has been called to the death at sea from heat exhaustion and heart failure, on 13th May, 1909, of an Asiatic fireman named Kootoobdeen Peerbux, whilst serving on the steamer "Caledonia," of Greenock; whether the seaman was medically examined before joining; how long had he served on the vessel, and whether he had any previous sea service; whether he was on duty at the time; what was the temperature of the engine-room; how much coal the engine-room hands were required to work each 24 hours; whether the engineer's log-book has been produced to the Board of Trade surveyors; and whether any previous cases of deaths from heart failure, heat stroke, suicide, supposed suicide, or disappearance have occurred on this vessel?

Yes, Sir. The fireman Kootoobdeen Peerbux is reported to have died of heart failure and heart exhaustion after suffering from malarial fever. At the time of his death the ship was only five days out from Bombay, at which port he bad joined. The owners state that all the men on their ships are medically examined before joining, that Kootoobdeen Peerbux had had considerable experience as fireman, although not on the "Caledonia," and that when taken ill he was on duty in the engine room, the temperature of which was 112 deg. The amount of coal worked daily was 125 tons. The engineer's log-book has been produced to the Board of Trade surveyors. One other death (that of an able seaman) has occurred among the members of the crew during the last three years front heart failure, and also one (that of a trimmer) from an aneurism. No cases of death from heat-stroke, suicide, supposed suicide, or of disappearance have occurred during that period.

No. When he was taken ill he was on duty in the engine-room, the temperature of which was 112 degrees.

As the temperature of the engine-room was 112 degrees, does the right hon. Gentleman infer from that the temperature of the stokehold was considerably higher?

asked the President of the Board of Trade whether his attention has been called to an outbreak of beriberi on the steamer "Singapore," of London, manned by Lascars, on the passage from New Orleans to Antwerp; if he has any official information showing that five of the Lascar seamen died from this disease on the passage, and six had to be put in hospital on the arrival of the ship at Antwerp; that the cause of the outbreak was the bad quality and insufficiency of the food; will he say whether these Asiatics were medically examined before joining, and how long they had served on the ship; and whether any previous cases of deaths from this disease have occurred on this vessel?

My attention was called to the outbreak of beri-beri to which my hon. Friend alludes, and the Board of Trade ordered an inquiry to be held under the provisions of Sub-section (b), Section 728, Merchant Shipping Act, 1894. Upon receipt of the report of that inquiry, I will furnish the hon. Member with the information which he desires. No previous deaths from beri-beri have been reported on board the steamer "Singapore."

Under the Section quoted is the power of the Board of Trade to appoint an inspector to inquire into the causes of accidents or damage, and also whether the whole machinery of any steamship is sufficient and in good condition, and as to what that has to do with the disease of beri-beri?

I have only inquired into the conditions which prevail on board this ship?

Does the Section give power to the right hon. Gentleman to appoint an inspector to inquire into a disease of this character?

asked the President of the Board of Trade whether his attention has been called to the alleged improper feeding of the Lascar crew of the steamer "Langdale," of Liverpool, during her last voyage, and to the alleged assault on one of the Lascars when he stated the food was not good; whether any inquiry will be instituted into the matter by the Board of Trade; whether these Asiatics have now been discharged from the vessel; and, if so, whether the master has made proper provision for their return to their own country, as required by Section 125 of the Merchant Shipping Act, 1894; and whether any cases of death from beri-beri, consumption, heat stroke, heart failure, suicide, or disappearance have ever occurred on this vessel?

No allegations as to improper feeding were made to any officer of the Board of Trade, nor have any come to my notice with regard to this vessel. I have no information as to the alleged assault on one of the Asiatic seamen, but one of them was convicted at the Thames Police Court on the 18th instant of an assault on the first mate, and was sentenced to 14 days' imprisonment. The Asiatic seamen have not been discharged, but have proceeded with the vessel. In any event, Section 125 of the Merchant Shipping Act, 1894, would not apply to these men, as they were engaged at Colombo and not in India. No cases of death from beri-beri, heat stroke, heart failure, suicide, or disappearance, have occurred on the vessel since she was registered in 1903; there has been one case of chronic pulmonary tuberculosis.

Labour Exchanges

asked the President of the Board of Trade if he can state the position of the present officials of distress committees appointed under the Unemployed Workmen Act, so far as appointments under the Labour Exchanges Act are concerned?

The qualifications of officials of distress committees will be carefully considered with those of other candidates.

asked if the right hon. Gentleman is yet in a position to state the number of Labour Exchanges it is proposed to set up under the heads A, B, C, and the towns in which such Exchanges will be located?

The number and allocation of Labour Exchanges of the various grades to be established is not yet finally decided, but so far as can be foreseen at present the number of Class A Exchanges will be from 30 to 35, and of Class B Exchanges somewhat larger. Ultimately there will also be a considerable number of smaller Exchanges, sub-offices, and waiting rooms. As a general rule towns with over 100,000 inhabitants will have a Class A Exchange.

Railway Servants (Accidents)

asked the Secretary of State for the Home Department whether his attention has been called to the action of the North British Railway Company in refusing to supply artificial limbs to employés who have been injured in the execution of their duty; and whether he is prepared to consider an alteration of the law to compel employers to make this provision?

The Secretary of State is informed by the company that they do not now as a matter of general practice supply artificial limbs to injured employés in addition to paying compensation under the Workmen's Compensation Act. The workmen's claims under the Statute, which are met in full by the company, are very onerous, and the company do not feel justified at present in undertaking further expenditure by way of compensation. The Secretary of State does not think the time has come for the revision of the Workmen's Compensation Act.

Motor Vehicles (Speed Limit)

asked whether, having regard to the fact that the police have recently made regulations compelling motor omnibuses and motor cabs to place thereon a device for making a continuous noise when the speed exceeds certain limits, the Home Secretary will take the necessary steps in conjunction, if necessary, with the Board of Trade to have the same device placed upon tramcars?

This matter is still under consideration, but the application of this device to tramcars presents special difficulties, because of the varying limits of speed authorised for those vehicles.

Is the hon. Gentleman aware that some of the tramcars pass along the Embankment at the rate of more than 20 miles an hour?

Death Of Pit Sinker (Maltby Colliery)

asked whether the Home Secretary has received a Report from the chief inspector of mines for Yorkshire upon the cause and circumstances which led to the death of George H. Good-graves while engaged in pit sinking at Maltby main colliery; and, if so, whether the Report makes any recommendations as to taking better precautions for preventing such dangerous practices as were brought to light at the inquest?

The Secretary of State has received a further Report from the Inspector of Mines, from which it appears probable that the accident was occasioned by a failure or delay in sending a signal to the driver of the locomotive which was being used in raising materials from the shaft. The Report raises the question of how far locomotives should be used in raising men or materials from a mine shaft, and this question will receive careful consideration from the Department.

Electricity In Mines

asked whether the Home Secretary has applied to the Chancellor of the Exchequer for any grant of public money to make the experiments which the inspectors of his Department state are necessary should be made without delay to safeguard the lives of miners where electricity is employed?

The Secretary of State has not received any recommendation from the inspectors of mines as to the necessity or urgency of any experiments with regard to electricity, though he has seen a paper read at the Institution of Mining Engineers by Mr. Nelson, in which he suggests that certain experiments on live cables would be of interest and might be valuable. The whole subject of the regulations for the use of electricity in mines is about to be referred to an expert Committee, who will doubtless consider how far any such experiments would be useful and by whom they can best be made. Their recommendations will have the Secretary of State's most careful consideration.

Public Elementary Schools

asked the President of the Board of Education whether, in view of the interest that has been displayed in the re-issue by the Board of Education of the first instalment of the suggestions for the consideration of teachers and others concerning the work of public elementary schools, he can see his way to fix approximately the dates on which further instalments will be issued and to supply Members of this House with the order in which the subjects discussed will be considered?

The preparation of the future instalments has not reached a sufficiently advanced stage to enable the Board to say when or in what order they will be issued, but it is probable that the next subject dealt with will be Drawing.

asked whether it is within the President of the Board's knowledge that, in many of the public elementary schools of the country, headmasters are allowed to delegate powers of corporal punishment to their assistants, and that these assistants in their turn are accustomed to employ one of the pupils to watch and report other pupils for punishment; and whether he will take measures to put a stop to this practice?

It is within the discretion of the local education authorities to make regulations as to the persons to whom, and the conditions under which, the infliction of corporal punishment may be delegated, and the Board do not consider it necessary to intervene except when particular cases of abuse are brought to their notice. The Board are not aware of the practice of employing children in the manner suggested in the question, and it is certainly not one which they would approve.

Will the hon. Gentleman inquire whether it is the fact that children are employed in this way to watch other children and report them for punishment? If they are, will measures be taken to put a stop to that practice, which is obviously reprehensible?

Perhaps the hon. Gentleman can give us information as to the practice, and if we find that it is in operation we can make inquiries.

Is it not the fact that the Board of Education have issued Regulations which confines the power of inflicting corporal punishment to the headmaster?

That is a matter which is left to the discretion of the local authorities. The Board of Education only deal with special cases of abuse that may arise.

May I ask whether the Board of Education think it desirable that assistant masters should be vested with powers of corporal punishment?

Ashford National Schools

asked whether the right hon. Gentleman's attention has been called to the fact that Cyril Marsh Nearns, headmaster of the National schools at Ashford, under the Middlesex County Council, was, on the 6th instant, summoned for assaulting one of his pupils, aged 10, who, because he was unable to perform an allotted task in drawing, was placed by Nearns over a desk and thrashed with a cane until it broke in two, and that Nearns was convicted by the Bench unanimously, and fined £5, the highest penalty within their power to inflict; whether he is aware that the mother of this boy was, previously to this occurrence, summoned before the school attendance committee for rot sending her children regularly to school, and alleged that the conduct of Nearns to her children rendered their attendance impossible; and what course does he intend to take with reference to Nearns with a view of checking the infliction of similar barbarities on children?

This case is under consideration. I am not in a position to make any statement at present.

Water Supplies Protection Bill

asked the President of the Local Government Board whether he has received a resolution from the Central Chamber of Agriculture with regard to the Water Supplies Protection Bill; and, if so, what course he proposes to take?

:I have received a copy of the resolution referred to. It urged the Government to send the Water Supplies Protection Bill to a Joint Committee of both Houses without delay. I am afraid, however, that it would not be practicable to adopt this course during the present Session.

Vaccination Notices, Lambeth (Case Of Mr Silvey)

asked whether the right hon. Gentleman is aware that the Lambeth vaccination officer did not serve Form Q on Mr. Silvey, 47, Frazier-street, Oakley-street, Lambeth, reminding him of the date on which the four months from the birth of his child expired, during which period he could have declared his conscientious objection to vaccination; and whether, in view of this fact, he will notify the officer not to prosecute Mr. Silvey for the non-vaccination of his child after it attains the age of six months?

I understand the facts are as stated in the question. The fact that he did not receive Form Q does not relieve the parent from liability to proceedings for not having his child vaccinated. It rests with the vaccination officer to determine in the circumstances what action he will take.

New Oxford-Street

asked whether the President of the Local Government Board is aware that the following angles of side-fall to the gullies in New Oxford-street, between Kingsway and Tottenham Court-road, have been measured along the length of roadway, namely, 1 in 23.6, 1 in 23.3, 1 in 19, 1 in 21.3, 1 in 13.7, and many others below 1 in 25; and whether he will cause a report on these dangerous inclinations, which affect motor, cycling, and horse traffic, to be made by one of his inspectors with a view to making representations, if the facts are as alleged, to the Holborn Borough Council?

I have no information as to the accuracy of the measurements mentioned in the question, but I understand from the borough surveyor that, in accordance with modern practice in road construction, the surface for a few feet around gully gratings has been given a slightly steeper fall than the rest of the road, to facilitate the removal of rainwater; also that, in consequence of the fact that the land rises sharply on the north side of the street, it is impossible to avoid making a steeper camber at the intersection of the side streets. Apart from these instances, the general inclination of the road is 1 in 38, and I learn that, although the road has been open for traffic for several weeks, no accidents have been reported. I have no jurisdiction with regard to the construction of roads by a Metropolitan borough council, and I do not think I can properly intervene in the matter.

May I ask the right hon. Gentleman whether he has received any complaints from anybody else except motor car owners?

I have not had any other complaints. The question put by the hon. Gentleman is not alone connected with motor cars.

Devonport Dockyard (Established Men)

asked the First Lord of the Admiralty what has been the number of established men employed in His Majesty's dockyard, Devonport, during each year of the past six years, and the number of men placed on the establishment in each of these years?

The total number of established men employed during each of the six years was:—1904, 1,829; 1905,1,886; 1906, 1,887; 1907, 1,867; 1908, 1,791; 1909, 1,742. The number of men placed on the establishment in each of the first four years was:—1904, 504; 1905, 83; 1906, 59; 1907, 30. Admission to the establishment has been suspended since 1907.

Coastguard Duties

asked whether the First Lord can state on what grounds a telegram addressed to the coastguard station, Sunderland, by relations of the crew of the Cullercoats fishing coble "Grand Old Man," asking for news of the boat which had been driven southwards during a gale on 31st August, was refused at the coastguard station; and whether it is part of the duty of the coastguard to render assistance by keeping a look-out and reporting vessels in distress?

The telegram received by the Sunderland coastguard station did not contain any name or address of the sender. Inquiries were made of the Sunderland Post Office whether they could furnish the name and address, but they could not do so. It was therefore impossible to reply—and the original telegram and reply-paid form were returned to the General Post Office, Sunderland. The reply to the second part of the question is in the affirmative.

asked if the right hon. Gentleman will say the number of coastguards per mile of coastline in Scotland, and the same number for England; and whether this entails coastguards in the former country having more onerous duties to perform than those in the latter?

My hon. Friend's question appears to be founded on a wrong impression of the basis for the distribution of the coastguards, there being large tracts of the coast not supervised at all by the force. The average number of coastguards per mile of coastline under the supervision of the force is in England one to 1.2 miles, in Scotland one to four miles, but the number of coastguards employed in any particular area is fixed according to the special requirements of Revenue protection in such area, and is dependent on other considerations than those of length of coastline. The larger number of men in England is due to the greater facilities for smuggling—for example, proximity of foreign countries, easier access by boats, etc.—and for the same reasons a more careful watch and more frequent visits are required, necessitating a larger number of men. The amount of work is not, therefore, to be gauged by the length of coastline, and it is not considered that the men in Scotland have more onerous duties than those in England.

Good's Shipbuilding Company, Greenock (Fair Wages Clause)

asked the First Lord of the Admiralty whether he is aware that Good's Shipbuilding and Engineering Company, Greenock, Government contractors, are violating the Fair Wage Clause by paying the labourers in their employ 4d. per hour instead of the customary rate of 4½d.; and whether he will take steps to see that the Fair Wage Clause is complied with?

The matter raised in the first pant of the question has not been previously brought to the notice of the Admiralty, but if the necessary details with regard to the particular Government contract, etc., involved are furnished, the necessary inquiries will be made with a view to ensure compliance with the Fair Wages Clause in Government contracts.

This question was put down a week ago, and the right hon. Gentleman promised he would make inquiries. I understand he has not yet commenced to make inquiries.

I think my hon. Friend is in error. I have not seen a question with regard to Good's Shipbuilding and Engineering before.

May I make a correction in reference to this question? The word "Good's" has been substituted for "Scott's" in the name of the firm referred to.

Fitzwilliam Estate (County Wicklow)

asked the Attorney-General for Ireland if Earl Fitzwilliam has sold to a middleman named Minion a farm in the occupation of Patrick Condren, a sub-tenant; if so, was Condren afforded any opportunity, either by the landlord or by the Estates Commissioners, of purchasing his holding; whether Condren's portion of the land is yet vested in Minion; and, if so, can he say under what Section of the Act of 1903 has Condren's farm been given to the middleman Minion?

The Estates Commissioners inform me that the owner entered into an agreement to sell to Minion the farm of 152 acres which he held as a tenant. The purchase money has been advanced, and the holding was vested in Minion in April, 1908, under Section 5 of the Irish Land Act, 1903. Condren holds three acres, three roods of the holding as a sub-tenant.

May I ask whether Condren got any opportunity of purchasing his small holding, and whether, when the representation was made to the Estates Commissioners, it included all the names of all the tenants, and whether Condren was represented as a sub-tenant to Minion?

I am not aware of the precise facts suggested by the hon. Gentleman.

Would the hon. Gentleman say if the sub-tenant who has a holding separate, and with a separate rent, is entitled to purchase; and, that being so, will he ask the Estates Commissioners to take care all those sub-tenants should not be passed over?

As regards the matter raised by the hon. Member, Section 50 of the Act says that the Estates Commissioners have the right to do so, and sell to a sub-tenant by declaring his holding a separate holding. There is no obligation on them to do so. The discretion is left with the Estates Commissioners.

Will the hon. Gentleman ask the Estates Commissioners to give particular attention to the case of those subtenants, and allow them to exercise the right of purchase as well as the larger tenants?

You may be sure the Estates Commissioners follow the proper course in the matter.

Mine Experiments (Royal Commission Report)

asked the Chancellor of the Exchequer whether, seeing that in the Second Report of the Royal Commission on Mines, recently presented to this House [Cd. 4820], the Commissioners, on page 84, report that the Government declined to contribute towards the cost of certain experiments which the Commissioners considered were urgently required for the safety of miners, he will, in view of his declaration on 19th September that no such request had been received by him from the Commission, communicate with the Commissioners for an explanation of this paragraph in their Report; and whether any representation was made by the Commission for this grant of public money to any permanent official at the Treasury or to the Financial Secretary to the Treasury?

The section of the Report of the Royal Commission to which my hon. Friend refers does not deal with the use of electricity in mines, which formed the subject of his previous question, but relates solely to coal-dust explosions, with especial reference to the value of wet or dustless "zones" in stopping or reducing the effects of dust explosions. If my hon. Friend will refer again to the passage which he cites he will find that the Royal Commission put forward no request for a grant in aid of experiments in connection with the use of electricity. As regards the last part of the question, the Royal Commission applied through the Home Office for a Government grant towards the cost of the proposed experiments with coal-dust, but the Government did not feel justified in acceding to their request.

This question does not refer to electrical experiments, I used the word in a former question. The question referred to experiments which have to be conducted by electricity.

I told him that no applications had been made to the Chancellor of the Exchequer.

Electricity In Mines

asked the Chancellor of the Exchequer whether he has received from the Home Secretary any request for a money grant in aid of making experiments in connection with the use of electricity in mines; and whether, in view of recent explosions believed to be due to some unknown electrical fault causing enormous loss of life, and that his Majesty's electrical inspector of mines has publicly stated that these experiments are urgently required, he will forthwith provide the necessary funds?

My right hon. Friend has received no such request from my right hon. Friend the Home Secretary.

Soldiers' Defective Teeth

asked the Secretary of State for War whether, in view of the, fact that many recruits for the regular Army, otherwise qualified, are rejected because of defective teeth, means will be devised to rectify this failing, and so make considerable reduction in the proportion of rejections?

Whenever, in the opinion of a recruiting medical officer, dental treatment will render a recruit efficient, the necessary treatment is now given, provided the cost of such treatment does not exceed £1.

May I ask if provision will be made for the proper care of soldiers' teeth as part of their regular daily routine?

May I ask if it is the opinion of a great many dentists that the teeth of young men are bad because of the bad treatment of infants by vaccination?

May I ask whether it is not a fact that 10 out of 12 men at Aldershot, highly trained men, who had been in the Army some time and returned as having bad or unserviceable teeth, would require £3 to improve them, and whether he does not think that that small expenditure was justified in that case, and whether he will take steps to have it done?

I know nothing about that. Will the hon. Member put down a question? What I do say is that for the last two years there has been a very considerable improvement in the teeth. The teeth are now taken care of to the extent of a pound.

May I remind the right hon. Gentleman that only yesterday he answered a question as to this case?

In view of the physical degeneracy which is going on in all parts of the country, will the right hon. Gentleman represent to the Government the absolute necessity of feeding the children in the schools?

Can the right hon. Gentleman supply corresponding statistics referring to the French army?

I do not know whether they exist. If the hon. Gentleman puts down a question I will inquire.

Does not the percentage of rejections vary inversely to the state of trade? When trade is bad and lots of men are out of work, do you not get a better class of recruits?

Uganda (Gold Extraction)

asked the Secretary of State for Foreign Affairs whether he had received any information from the authorities of Uganda to the effect that prospectors in the employ of the King of the Belgians were extracting gold from a point south-west of Lake Albert, on the British side of the boundary; and, if not, whether he would make inquiries?

No information has been received from the Government of Uganda to the effect stated, but inquiry shall be made.

Egyptian Law (4Th July, 1909) Administration

asked the Secretary of State for Foreign Affairs how many persons had been removed from their homes under the operation of the Egyptian Law of 4th July, 1909, and how many of these had been previously convicted; whether this law was administered by native officials, and by whom were the lists of proscribed persons prepared; and how many names had appeared on the preliminary lists of proscribed persons?

I have not yet got any information on these points, but reports will be furnished regularly as to the working of the law, and as soon as information is forthcoming I shall be prepared to give it.

Bu Hamara (Execution)

asked the Secretary of State for Foreign Affairs whether His Majesty's Government had any official information showing that Bu Hamara was executed by order of the Sultan Malai Hafid on 12th September, immediately following representations made to the Sultan by the foreign consuls against the torturing of prisoners by him; did His Majesty's consul join in this protest of the foreign consuls; and, if so, what steps he proposed taking, if any, to see that representations made by His Majesty's Government are not treated with contempt?

The answer to the first part of the question is in the negative. I have already stated that a collective representation against the torture of prisoners was made by all the Treaty Powers. I cannot at present foreshadow the action of His Majesty's Government in a hypothetical contingency. The action taken hitherto has been collective action, and any consequences of it will presumably be considered collectively by the foreign representatives, if necessary.

England And Spain (Interchange Of State Visits)

asked the Secretary of State for Foreign Affairs whether the King of Spain had been invited or was about to pay an official state visit to His Majesty King Edward, to be followed next year by a return visit; and, if so, whether, in view of the arrest and prospective trial by court-martial of Senor Ferrer and people who had been identified more or less with Senor Ferrer's policy, he would advise His Majesty against any such interchange of visits?

May I point out that the question has been sub-edited? Before "people" the number "50" should appear, and before "policy" the word "educational" should be inserted.

I do not think the omission of those words affects the reply of my right hon. Friend, which is: "The answer is in the negative."

Have any communications been received from a committee of educationists in regard to this matter, praying the British Government to intervene?

The hon. Member must give notice of that. With regard to the alteration in the question, I am responsible for that. I did not think the question was in proper form.

Egyptian Affairs (Desirability Of Discussion)

asked the Prime Minister whether he would consider the desirability of devoting one day in each Session to the consideration of the Egyptian Budget and the Annual Statement of the British Agent and Consul-General in Egypt?

I do not desire in any way to depreciate the importance of Egypt, but I think it would not be advisable to select a special day and allocate it annually to the discussion of one particular subject of foreign policy. There are at present several opportunities in which foreign affairs can be discussed during the Session. There are very great demands upon the time of the House, and I think the present system is the best for ensuring that those subjects of foreign policy which arouse the most general interest in the House each year should be brought forward and discussed.

asked the Prime Minister whether he had recently received any protest from Egyptians in reference to the British occupation of Egypt; and whether, in view of the inadequate facilities afforded to this House during the present Session for the discussion of Egyptian affairs he would allot a day, or a portion of a day, to a Debate on the policy of his Majesty's Government in Egypt?

I have received a telegram in the sense described demanding the evacuation of Egypt. I cannot see in it any reason for setting aside the work of the House of Commons in order to provide for a special discussion on Egypt.

Charity Commission (Mineral Income)

asked the Prime Minister whether, in view of the official estimate that a period of no less than 18 months would be required to enable the Charity Commissioners to state the total mineral income received by the charities under their control for the year 1908, he would consider the question of reorganising that Department, so that Members of this House were not debarred from receiving information relating to that Department, seeing that the same information, together with full particulars of the rents, way-leaves, etc., had been furnished by other Departments of State within a period of four days?

My hon. Friend is no doubt aware that, while the Ecclesiastical Commissioners actually administer the estates under their control, and are therefore able to furnish particulars of all mineral rents received, the Charity Commissioners, whose functions are purely judicial, take no part in the management of the estates of charities, although their sanction is required to certain dealings with property under the Charitable Trusts Acts? Although accounts of charities are directed to be furnished to the Commissioners they have no power of audit, and I understand that to furnish information as to mineral rents for a given year would entail an examination of the accounts of about 50,000 charities, in respect of a matter which does not fall within the statutory duties of the Commissioners.

Does not the Prime Minister think it desirable that this House should know the total revenue derived by charities in the country from mineral way-leave rents?

It would be desirable, but I do not think that the Charity Commission, as at present constituted, is a proper body to furnish such information.

Business Of The House

To go on with the Committee stage of the Finance Bill until it is concluded, and which I hope may be on Thursday. If that is so, on Friday we shall take the Expiring Laws Continuance Bill, some small Bills, and Lords Amendments to the Trade Boards Bill.

Will there be any chance of getting a part of a day for the consideration of the Report of the Public Accounts Committee?

Do the Government propose to afford the House any opportunity of considering the very remarkable Report of the Committee of Privileges?

I think that at this stage of the Session the time of the House might be more profitably occupied with other matters, particularly as there will be a full opportunity when the Sessional Orders are next reviewed, of going into the whole matter.

Finance Bill

Considered in Committee.—[ 33rd Day.]

[Mr. EMMOTT in the Chair.]

(IN THE COMMITTEE.)

Part V—Stamps

Clause 56—(Stamp Duty On Marketable Securities)

The Stamp Duties chargeable on marketable securities (other than Colonial Government securities) under paragraphs (1) ( c), (3), and (4) of the heading "Marketable Security" in the First Schedule to the principal Act, and the Stamp Duty chargeable on marketable securities, share warrants, or stock certificates to bearer under Sub-section (1) of Section four of the Finance Act, 1899, shall be double those specified in the said Schedule or charged by the said Section, as the case may be.

moved to leave out the word "Government" ["Colonial Government securities "].

The object of the Amendment is that securities of municipalities should have the same advantage as Colonial Government securities, and not be chargeable with double Stamp Duty. I understand that the Government are prepared to consider the matter.

We think that the exception in favour of Colonial Government securities is a sufficiently wide extension of the exemptions, and I am afraid we could not accept this Amendment.

The right hon. Gentleman has refused to accept this Amendment on the ground that my hon. Friend has not very clearly stated his arguments for its adoption. I differ from him. I think my hon. Friend has stated very clearly that he wishes the same facilities and advantages which are to be given to Colonial Government securities to be given to other Colonial securities, irrespective of the fact as to whether or not they are Government securities. The right hon. Gentleman says that he considers that the Government have gone far enough in giving exemptions under this Clause to Colonial Government securities. It is evident by that that the Government consider that Colonial Government securities ought to have some preference. If Colonial Government securities ought to have some preference I fail to see any reason why preference should not also be given to Colonial municipal securities. There is also the question of Colonial provincial Government securities. When this question was discussed upon the Resolution—if the Financial Secretary will refer to the Debate on that occasion he will see—there was an undertaking on the part of the Government to consider whether or not they should include Colonial provincial Government securities as well as Colonial Government securities.

I think there was some little misunderstanding during the Debate as to the position of the provincial Government securities. There is no question that under the existing law provincial Government securities are included in the Colonial Government securities, are exempt from the operation of this Clause, and will be exempt in the future, as in the past.

It would be just as well then that the intentions of the Government should be defined. Of course, I accept the right hon. Gentleman's statement, which, no doubt, his advisers have given to him in good faith. But the words are not clear, and if a legal question was to arise it would be no argument to say that in the House of Commons the Financial Secretary told us that it was not the intention of the Government to do so and so. The answer of the judge, or whoever the question might be referred to, would be: "I have nothing to do with what took place in the House of Commons; all I have to do is to consider the Act of Parliament." Therefore I trust, on the Report stage if not now, the right hon. Gentleman will cause words to be inserted which will carry out his intention.

But the question of Colonial municipal securities is not touched, or other Colonial securities. If Colonial Government securities are excluded, other Colonial securities should be too. The object, or ostensible object, I presume, in excluding Colonial Government securities is to give encouragement to investors in this country to invest their money in the Colonies. If it is good to encourage investors to invest their money in Colonial Government securities, surely it is good, too, that their money should be invested in the municipalities, the railways and other enterprises in the Colonies. The right hon. Gentleman says the Government have gone far enough if they include Government securities and provincial securities. I do not wish to be cynical, but may I ask the hon. Gentleman: "Is the reason that he includes Colonial Government securities that the vast majority of them are not bonds to bearer, but are inscribed stock, and it therefore does not matter whether he includes them or not?" In the last 20 or 30 years a great change has come over the manner of issuing Colonial Government securities. Practically every issue is now inscribed stock—to the Bank of England, or the Bank of New Zealand, or any of the large banks in the City of London. Therefore they would not be touched by this Clause. You give the Colonies nothing, for it really does not matter whether or not they are exempt from this Clause. If I were of a cynical disposition, I should be inclined to believe that either the hon. Gentleman or his advisers were laughing up their sleeves, knowing perfectly well that this concession, as a matter of fact, is no concession at all. Under these circumstances, I trust the hon. Gentleman will accept the Amendment to make this inclusion in the exemption of Colonial securities. I see no reason why one form of these securities should be included and not another. I do not now propose to argue the question—a very important one—of the advisability of increasing these duties. That had better be raised later.

4.0 P.M.

I do not see when we are taxing ourselves at home why the Colonies should escape. That is the Birmingham policy, as I understand it. But I did not know that the Birmingham policy had been accepted by His Majesty's Government. Certainly I think it is discreditable to the House of Commons to put before us a Clause which, in order to attempt to understand, we should have to delve back for a number of years to former Statutes, and by a system of reference make out what a taxing Statute means. I think it is an insult to Parliament to print a Clause like this, which, without a very great deal of study, is absolutely unintelligible. I venture to say that there are not ten men in the House of Commons who understand it. I want to ask the Government if I rightly understand the meaning of the Clause to be this: That Canada, Australia, New Zealand, and the Cape, which do not contribute a single sixpence towards the upkeep of the Empire, shall escape from a duty that home companies, whether they be English or Irish, are compelled to pay? I want to know upon what ground we are indulging in this Colonial preference. As I understand it, the question of Colonial preference is an anathema on the Treasury Bench.

I do not see how this arises upon the Amendment. This is an Amendment to leave out the word "Government," and if that was done the Clause would read, "other than Colonial securities." The hon. Member seems to me to-be dealing with a different point, and to be raising the whole question of preference to the Colonies.

I am not surprised that you have taken the point of Order, because, as I understand the proposal, it is to leave out the word "Government," and if that was done it would then be "other than Colonial securities." My objection is this. In order to understand the matter you have to go back to the Stamp Act of 1891. What the Government, as I understand it, are doing in this Section is this. They are making a further extension of the principle of exemption in favour of Colonial security.

I think I understand it rightly. The Amendment would extend the scope of the exemption, and therefore would extend what is extended to Colonial Government to municipal or other securities.

I am attacking the Amendment. I say it is most unjust to give to the Colonies the additional advantage which the Government Clause in the existing state of the law under the Act of 1891 already allows. I heard a great deal about encouraging the Colonies, but I want to encourage the people at home, who ought, I think, to be our first consideration. I think the Clause already goes entirely too far. The Colonies, in my judgment, are not entitled to get from the taxpayer at home, who pay so heavily for the running of the Army and Navy, an advantage which, so far as I understand it, the Colonies themselves have not asked for. I do not know what the Colonies do with regard to British securities. I know nothing of the legislation of the Cape, or of Canada, or of New Zealand, but if the Colonies have asked for this extraordinary preference it is new to me. Therefore I think it would be an extremely strong thing indeed to extend the principle of the Act of 1891.

I take it for granted that the words here, "Colonial Government securities," would not include Indian securities, yet I see no reason whatever why the words should not equally apply to Colonial and Indian. Indian securities would be then on precisely a similar footing, as I understand it. The hon. and learned Member opposite attacked the principle of making exemption on the ground that none of the Colonies contributed to the cost of the Army and Navy. I venture to think he is wrong. They do contribute. It may be that their contribution is inadequate, but they do contribute in one way or another towards the upkeep of the Army and Navy, and by direct contribution. Certainly India does more than her share. I submit, on a point of justice, that this advantage should be extended to India.

The hon. Member can ask a question about bringing India in under this Clause; he may move an Amendment on that point if he wishes, but it does not arise upon this particular Amendment.

I will answer, if I may, directly, the question which was put to me by the hon. Member. India is dealt with under special Acts of her own, and in these Acts should enter into a composition for these Stamp Duties; she made her own bargain with the parties here, and pays her composition duties and is free.

That is quite true with regard to the vast majority of Indian securities. I do not say they are an enormous number, but they are a considerable number, and it is very important to these securities that they should be free from heavy Stamp Duties. They are not negotiable. It would be a very small exemption from the point of view of the Revenue, but it would be very important for the parties concerned.

The right hon. Gentleman opposite has told us that India has her own arrangement by the composition which she entered into. But what about the future? Will the composition be on the basis of the double duty or on the old basis? That is the whole point.

The vast majority of Indian loans are registered and inscribed, and therefore they do not come under this Clause at all.

The hon. Member for the City of London referred to me with reference to municipalities. I can only say that I find the English municipalities quite enough to take under my wing, without taking in the whole area of Colonial municipalities; but I would like to say, in reply to the observations that have fallen from the hon. and learned Member for North Louth (Mr. T. M. Healy) that whilst the Colonial and preferential loans are of value as cementing terms between England and her Colonies, these municipal loans are of the greatest value to the manufacturers in this country. It is by no means infrequent when a municipal loan is issued for terms of negotiations to be entered into as to the money to be found and the work to be done in this country. A Colonial municipality desires, for example, to start an electric lighting scheme, or an electric tram scheme, or some other work of that kind in the Colony, and it is by no means unusual to send the order to this country. The terms and conditions generally are that the financing of the work is arranged for in this country and then the work is done by this country. That is a frequent and constant method of business in regard to this work, and, therefore, now when you are going to handicap these municipalities by taxes you are doing a great injury to the manufacturers of this country, and the workmen of this country. Take the case of works in Vancouver or waterworks in Montreal. All this work has been done upon English credit, obtained for the municipality, and the work has gone to the British manufacturers, and whilst we have at the present time no system of Colonial preference, there is no Colonial preference so great and so useful for the benefit of the State. The municipalities give the work to England: England finds the money. Now you are going to handicap them, and you are also going to injure the manufacturers of this country by making it more difficult for him to obtain the money. I hope the Chancellor of the Exchequer will consider this position quite as much as he considers the position of the Colonies and the provinces, and that subject to proper control the municipalities will be put in the same position in the Colonies to obtain money as they have been in.

If these municipalities are hit they will go to America, which will have a considerable advantage in lending money. If the people are right who say that trade follows the loan, then America having this great advantage will probably get the trade of a great many people in the Colonies.

I want to ask your ruling, Mr. Chairman, in regard to this discussion. Several Members have been discussing Colonial municipalities. I notice that lower down on the Paper there is an Amendment standing in the name of the hon. Member for Durham (Mr. Hills). That Amendment raises the question of the exemption of the municipalities. Would I be in order in discussing that question upon that Amendment when it is reached?

The Amendment now before the House includes not only municipalities but several other forms of Colonial securities.

The point is specifically made—Colonial municipal securities. That is the point raised in the Amendment of the hon. Member for Durham.

My Amendment is limited to municipal securities or corporations. The present discussion is on a wider basis.

May I reply to the hon. Member (Mr. Hunt) by saying that the Colonies will come here to borrow because this is the cheapest market in the world? You cannot borrow money in America for corporations under 5 per cent. or 6 per cent., and when the Colonies are provided with cheap money in London the least the Government should ask is that they should contribute something to the State for it. Gentlemen coming from Canada to London should be in exactly the same position as Irishmen coming to London.

It seems to me, if we settle this matter on the Amendment which is now under discussion as to whether the word "Government" should or should not be taken out, the Amendment of the hon. Member for Durham, at any rate, in the form in which it is on the Paper, could not be moved.

I will confine my remarks to the proposal made by my hon. Friend, because I understand that, so far as Colonial provincial Government is concerned, the Chancellor of the Exchequer has conceded my point. I will deal with the question of Colonial borrowings. I approach this matter from the point of view of a business man. I recognise that the Chancellor of the Exchequer must have the money, but I take it that he does not want to injure business in getting that money. Anyone who is cognisant with the banking facilities of this country must recognise that hundreds of thousands and millions of foreign money are sent to this country to be invested in first-class gilt-edged securities. London attracts borrowers from all over the world because she has such good credit. Other nations deposit their money here in order that they may trade through English institutions. The point I want to make is that the more securities you can attract to this country the better it is for the Chancellor of the Exchequer.

Let us see why it is good for the Chancellor of the Exchequer. First of all because he gets his Stamp Duty on the issue; and, secondly, he gets the Income Tax on the interest, dividend, or coupons issued upon those securities which happen to be domiciled in this country. It is common knowledge to us all that when a loan is issued in this country the practice is that the coupons and dividends are payable in this country. That being the case, it must be of immense value to any Chancellor of the Exchequer, because he can from those dividends and coupons abstract his tax. Thirdly, the benefit derived from having these securities here rather than in foreign countries is due to the fact that they are domiciled here, and therefore you may be perfectly certain they are dealt in here. If that is so, then the contract stamps are paid here on every deal. On every one of these deals dealt with on the Stock Exchange, the right hon. Gentleman obtains his contract stamp. Fourthly, when any country borrows money from Great Britain, that money is very often utilised in this country, and it is frequently sent away, not in money but in kind, and in that way our industries are benefited. Therefore, any legislation passed by this House should be directed to supporting the policy of encouraging first-class securities to come into this country rather than keeping them out. The Chancellor of the Exchequer, in the remarks he made on this Resolution, made a very significant statement. He was dealing with Amsterdam and Belgium, and he said:—
"Really we cannot do that. It would give a preference in favour of the exportation of capital to foreign countries and the Colonies, instead of it being put into British industries."
I wish to make my criticisms from a non-political point of view, but when it is a question of British industries I find from my own experience that a great deal more money is being invested in our Colonies and outside this country than is being invested in British industries. You cannot dictate the channel into which the investing capital should go. One of the most difficult things is to arrange investments, and no one can dictate how the public are to invest their money. In this matter they have their freedom now at any rate, and I hope they will always continue to have it. The investor will have the security he desires, whether it happens to be in this country or not. If a stamp is put on these transactions of such a nature as to prevent these securities coming into this country, the investor will go away and invest where he gets the security he wants rather than be compelled to take the stock which is on the counter before him.

What is there to prevent capitalists, great and small, putting their capital together and forming themselves into a Canadian investment company, with their offices in Canada or America, utilising their capital there in order that they may find an investment for these very securities which this stamp may prevent coming into this country? They will create trust companies and other forms of capital banded together in order that they may go to Canada and invest in all these municipal and industrial bonds, which are competed for amongst Canadian capitalists, and the result is that those four points I have laid before the Committee will go by the wall, and this country will suffer, because we shall only then get the Income Tax upon the dividends which come here from those trust companies on the other side of the Atlantic; and there will be no Stamp Duty, and no chance of that money being spent in British industries. The result will be that you will only get the Income Tax from whatever money the directors of the company choose to send over to Great Britain. Those of us who recollect the time when the 10s. Stamp Duty was imposed on bonds will agree with me when I say that it proved a considerable check to business. I am thankful to say we have got over that, and we have adapted ourselves, so far as the City and financial institutions are concerned, to that stamp, but we are considerably handicapped, not only in London, but in other cities in this country in competing for these very bonds which it is so necessary to our prosperity should be kept in this country.

I am dealing now more with Canada, because Australia is bound to come here with those bonds. In Canada, our great Dominion, we have the international market with France, Belgium and America close upon the Canadian frontier line of country. Every year millions of money are required by those municipalities, and the result is that in every case I know of Canadian bonds are being put up for tender. Tenders are invited, and they are opened on a certain day, and the highest bidder gets them. Now, what is the position of the man in the London market as compared with a man in America? In this matter we must not sneer at America. America is immensely wealthy, and she has grown so large and is able to make so much money every year that she is compelled to form large trust funds and put enormous sums of money year by year into gilt-edged securities. A few years ago America could never touch us at all in regard to these transactions and never attempted to tender against us. The fact is we were in absolute command of the money market of the world so far as Canadian securities were concerned. As years have gone by my experience shows me that America is a very keen competitor in these bonds. How are we handicapped against America? First of all, we have to decide upon the price as which we tender, which must be governed by the price we think the public are likely to pay for an issue of this description. I am now talking about the various groups who are accustomed to compete for these bonds. I am sure the Committee will believe me when I say that in tendering for hundreds and millions of these bonds in exchange for their risk of buying them and their chance of selling them again to the public the tenderers have been content in making up their figures to put aside a profit of anything from 7s. 6d. to 12s. 6d. per cent. Som3vimes they make 15s., and I have known them make £1. I have also known them make 5s. per cent., and in some cases they have made a loss. I did not like to make this statement without consulting one or two of the leading groups in the City of London. I have consulted with those groups who are competitors of my firm, and each group has agreed with me and they have authorised me to make this statement to the Committee. When any of these groups have got these bonds they issue them here. The Chancellor of the Exchequer, as I have stated, gets his 10s. per stamp on the bonds, and he gets the contract stamp; the industries of this country gain, and the groups make the small percentage of profit which I have enumerated. I have touched upon the question of our tendering; but how does America tender? In making up our figures we have to arrange outside the ordinary expenses of underwriting and issue, for freight, insurance and exchange, a figure which, as mentioned by the hon. Member for York in the Debate on the Resolution, has at times been as high as 8s. 9d. per cent. We have in addition to put on whatever stamp the Chancellor of the Exchequer chooses to insist upon. In this way we are considerably handicapped in our competition with America. I do not want British municipalities to be called upon to pay this tax, and if the Chancellor of the Exchequer desires to help us so far as our business with the Colonies is concerned, he should provide that British municipalities ought to receive the same measure of leniency which he chooses to give to the Colonial securities, and he should recollect that one class of our securities is subject to foreign competition whereas our municipalities are simply subject to the home competition. My experience is, and I daresay it is the experience of many Gentlemen in this House who are in business, that the margin of profit in all our businesses, and especially in financial business, is growing smaller and smaller. The cable brings the money markets of the world in close touch—within a few moments—and competition is therefore keener. Where a man can borrow money cheap, he will borrow it. He is not going to look at the matter from the philanthropic point of view at all. A loan once issued by any municipality in a country always attracts loans to that country from the same borrower hereafter. If a new borrower, such as a new municipality, comes into this country, that borrower as a rule will always try and come and borrow here again. It does not follow they will get their loan, or that the conditions of the money market will suit them, but my experience is that they always try to borrow where they made their first loan. Towns like Toronto, Ottawa, Quebec, Victoria, in British Columbia, have recently gone with their loans to America, simply because we dare not tender high enough and risk a loss by having to cater for this extra 10s. Stamp Duty.

One hon. Member has mentioned that trade follows the loan, and that is my experience. Once you get a business in a groove it is very difficult to dislodge it. The business of lending money to our Canadian municipalities and others has got into a groove of competition between America and this country. If by making the tax too great upon the lender the loan business should get out of the English groove and into the American groove it will be difficult to get it back again to this country. I have heard it stated by some hon. Members, and I also know, that many large insurance companies, trust companies and others who have felt even the 10s. duty heavy enough, have bought their bonds and securities in other markets, and have left them in the place of origin and have allowed the coupons to be collected there and to be credited to them in that country. That is no good to me. I want to see the securities dealt with here, and anything that traverses that is a subject which I think I am justified in bringing before the Committee. I would say to the Chancellor of the Exchequer, "Tax, but do not kill. Do not kill large financial industry which has been created in this great Metropolis of ours." Finance is a very delicate plant, and, if you meddle with it and begin to look at the roots, it will be a long time before that plant will get thoroughly embedded again. A great deal has been said about the Stamp Duties of other countries being very much heavier than they are here. Countries like Amsterdam, Belgium, and America have no Stamp Duties, but there is a Stamp Duty in Paris and Berlin. In the few remarks I made on the Resolution I mentioned that the Paris stamp was 2 per cent. I speak under correction, but I understand that it is not yet 2 per cent. It has been brought before the Chamber by the late Minister of Finance, but it has not yet become law. It may be a point raised that France has this 2 per cent. duty. When you increase the Stamp Duty, what effect do you think it has upon the securities to which the duty refers? The last time Berlin raised her Stamp Duty from 1 to 2 per cent. was in 1898–9. At that time the British Chancellor of the Exchequer received on our 10s. bond stamp £180,789. The result of Berlin putting the stamp up 1 per cent. was that, instead of the Chancellor of the Exchequer here receiving £180,000, all the bond business from Berlin had been driven to this side, and he received £358,000.

1898–9 and 1899–1900. Take the case of a simultaneous issue. Very often when there is a large issue it is issued in various centres. A loan is issued in America, Canada, England, and, it may be, abroad. Suppose an issue is made of that description—we will say £1,000,000 or £2,000,000. A proportion is retained for this country, a proportion for America, and a proportion for Canada. The proportion which remains in this country is all we ever get, because, if the people in America and Canada desire to sell their proportion in this country, they have to consider before selling it whether they will pay the Stamp Duty plus the 8s. 9d. cost of freight. I have detained the Committee rather long on this matter. I apologise, and I am very grateful to them, but I should just like to mention short bonds. If the tax, as I maintain, is quite heavy enough now at 10s. per cent. on what we call long-dated bonds, bonds to run 30 or 40 years, how much heavier must it be on the short-dated bonds. There are some Gentlemen who are thoroughly conversant with the way in which some of the American railways borrow money on short-dated bonds. Very often a railway has to make some large extension, costing many millions of money. It is no good borrowing those millions of money all at once, because many millions would be lying idle, and only be receiving deposit rate, whereas the borrower would possibly have to pay 4 per cent. in the meantime. One can, therefore, imagine these railway companies, if the extension is to take three or five years, issuing short-dated bonds all to become due at the time when they are able to make one large loan to pay for the extension when it is completed.

It is hardly worth while interrupting the hon. Member in a speech of this character, but, of course, he is not on the Amendment. He is on the question of loans raised by American railroads, which would properly come on the question of the Clause standing part of the Bill.

I apologise. I was on the question of the 10s. duty on the short-dated bonds. It is hard upon the three or four year bond to pay 10s. now. It will be much harder upon them to pay £1. If you borrow money, say at 3½ per cent., for four years, and you are charged £1 Stamp Duty, that makes 3¾ per cent. If there is one thing the Chancellor has not touched, it is bill stamps, and very properly so, too. I know, and the Chancellor may know, that a bill stamp covers more than one year, and it is only a shilling per cent. What is to prevent people, if they are overcharged, issuing bills with a 1s. stamp per cent.? You run the risk of that. I have myself seen bills running for more than one year which have had the 1s. bill stamp on them. I have tried in the few remarks I have made to bring out my own business experience, and the experience of others who have been good enough to let me discuss the matter over with them, and I have also tried to show the difficulties which may arise if the Chancellor of the Exchequer insists upon increasing the 10s. duty to £1. The question is, will it force away a certain amount of business which comes into this country? I have endeavoured, perfectly honestly, to show what I think, personally, may happen, and I make my statement because I have my past experience by which to go. I know the difficulties in obtaining these bonds to-day. We lose them even now, but what shall we do if this £1 is to be put upon them? It is all very well for some people to say, "What does it matter, Canada gets her money, and as cheaply as she can?" That is Canada's point of view. I am trying to put it from the point of view of this country. We want to lend our money, and, in lending our money, we are doing good to the Chancellor of the Exchequer right away down to the small investor.

It is very refreshing indeed to hear a speech of the character to which we have just listened, and I am sure all the Members of the Committee who are present this afternoon will join with me in felicitating the hon. Gentleman who has just sat down, not only upon the character of his speech, but also upon the manner in which it was delivered. I am quite certain that the fears he expressed were genuine fears, and were not expressed on behalf of the trade in which he is concerned. He really was looking at the question from a national point of view, and expressing what he believed to be the fears for the prosperity of what is, after all, a national concern. In attempting to follow that speech, I labour under the great disadvantage of not having that technical knowledge and professional experience which in the course of many years' business the hon. Gentleman has admittedly acquired. But I do think there is a general case to be put on behalf of the proposals of the Chancellor of the Exchequer which is of such force, and in support of which such cogent arguments may be adduced, that the more particular reasons advanced by the hon. Gentleman to the Committee may be pushed on one side. The hon. Gentleman laid it down very truly that the credit of the City of London was a great national asset which we should do nothing at all to endanger, and he went on to say that the use of capital which was employed and owned by the City of London as representing the country would, if an extra duty of 10s. per cent. were laid upon it, seriously endanger our ability to lend to the Colonies and to other places abroad the sums which we do now lend. These amounts are undoubtedly of very great dimensions. I think in the course of last year we lent something like £40,000,000 to Canada, and not far short of £60,000,000 to America, and, of course, it is quite certain that anything which would really involve a stoppage of the use of that capital, either by this country or by any other country, would be a very great impediment to the general trade—not merely to the money trade, but to the general trade of this country. The hon. Gentleman went on to say that America was becoming a very dangerous competitor with us in the loans which we make either to municipalities or to industrial concerns in the Colonies and elsewhere. He said that a few years ago this competition did not exist. That is quite true, but, from such information as I have been able to acquire, the reason why it did not exist was not because there was no Stamp Duty, but because there has been during the last 10 or 20 years the most enormous accumulation and growth of capital in America which has probably ever been witnessed in the history of the world. It is idle to suppose that the wealth accumulated in that country is not going to be employed in competition with us in other countries—in competition with us both in America and in Canada. It is quite certain, whether we remain in the exact position in which America is at the present moment, with no Stamp Duty at all, that the competition will be as keen as it is at the present moment. It is not a question, in my judgment, and in the judgment of those who advise my right hon. Friend—it is not so much a question whether there is or not a Stamp Duty.

I venture to offer a suggestion to the hon. Gentleman opposite. I do not think he can deny the general proposition which I have addressed to the Committee. In the course of his most admirable speech he made one or two admissions which I think will be of great value to many of my hon. Friends on this side of the House. He told us that it was impossible to dictate the channels in which capital should flow. That is a most admirable sentence, but how much more difficult is it to attempt to dictate the channels in which trade shall flow. Two points are inextricably mixed up. The loan which brings the trade is quite as responsible for that trade which follows that loan as any attempt to dictate to that trade by means of fiscal regulations and laws. The hon. Gentleman went on to say that the first imposition of the Stamp Duty seriously interfered with the flow of business in this country, but, having said that, he went on to make this further admission, that in the course of business they had entirely got over that difficulty. His words were, "We have entirely got over this by now, and trade has adjusted itself to the new conditions." I think it is just as well to remember that it was in the year 1899–1900 that the then Chancellor of the Exchequer (Lord St. Aldwyn, at that time Sir Michael Hicks Beach) was responsible, if not for the original imposition of this tax, certainly for its wide extension, and I should like to point out in connection with that, that the transfer of this revenue which accrued to this country in the year 1899–1900 depended not so much on the transfer of German business here as upon the wider net which the Chancellor of the Exchequer spread in that year for transactions of the sort which we are now developing. It is just as well to realise this. I venture to suggest to the Committee that, while we have attempted in this Finance Bill to lay upon every class of the community the burden, after all it is a burden which will represent an adequate contribution to the sums which we have to raise in order to settle our national bill. We have not laid the business represented by the Stock Exchanges in London and other parts of the country under unnecessary or undue burdens. My right hon. Friend has made these proposals for the taxation of marketable securities, and, in accordance with the views of the Stock Exchange, he has moderated this burden so as to render it as little harsh and disagreeable as possible. The hon. Gentleman knows quite well that when this particular Stamp Duty to which I am referring was under discussion, my right hon. Friend said to those who represented the finances of this country that if it were possible, in some other way, to raise from the accumulated capital of this country and from the money markets of this country a sum corresponding to that raised by this tax, he would be only too glad if possible to accept such a suggestion. Our difficulty has been throughout that, while there are great sums of money in this country bringing in great wealth, the possessors of those wealthy accumulations have not been able to suggest—I do not blame them in any way for not doing it—any other plan than that which we are now proposing to the Committee for securing the revenue which it is essential we shall have for this year. I agree it is only a limited sum we are raising this year, but what other method can be suggested for raising this sum from this kind of transaction? Any other suggestion we should have welcomed and considered, and, if possible, accepted, but our difficulty has been that while members of the Stock Exchange and business men represented by the hon. Gentlemen opposite have complained, and reasonably complained, of the burden laid upon them by this tax, they have not been able to make any proposals to us which would have been equally profitable to us and less burdensome to themselves.

If I may answer in a sentence or two the Amendment which, after all, is a peg upon which all this discussion rests, I would say this: The Mover of the Amendment has suggested that all securities and not only Colonial securities should be released from the pressure of this tax. I do not see why we should not gather from those who lend either to industrial concerns or municipal enterprises in Canada and other countries their money—I do not see why we should not levy upon them some slight return for the capital which is exported from this country, and which they put to this use. It is quite true that, in conformity with past practice, we have released Colonial Government securities from the Stamp Duty. In that we have followed the practice of the year 1891, but to exempt sums of money which are sent to the Colonies, sums amounting in the case of Canada to £40,000,000, and in the case of Australia to £8,000,000 or £10,000,000—to have exempted these from the demand which we have made in order to enable us to meet the expenses and necessities of this country, would, I think, be to give them an unfair preference to which the citizens of this country might reasonably object.

5.0 P.M.

The right hon. Gentleman commenced by paying what I think the whole Committee will feel was a well-deserved tribute to my hon. Friend behind me for the speech that he made. The right hon. Gentleman, speaking on behalf of the Government, did not confine his commendation to the matter of the speech; but, also, speaking again I venture to say, with the full assent of the whole Committee, expressed what we recognise—that my hon. Friend had put an extremely difficult and technical case to the House, not only in the clearest possible way, but also in a manner which secured the sympathy of everybody who might not agree with his views. It was felt he put a very difficult case, representing, as he believed, and, as we believe, a great national issue to the House in away which was quite free from anything in the shape of party bias. I also remember that the right hon. Gentleman prayed the indulgence of the House in dealing with my hon. Friend's speech on the ground that he had none of that practical experience of business to which this Amendment of the Clause specially refers, and which my hon. Friend enjoys in so full a measure. But the right hon. Gentleman has at his disposal great sources of information from experienced and highly trained officials, who have no superiors in the world; and he has the means of filling up gaps in the armour which many of us have not. But, however urgent hon. Gentlemen opposite may be in support of the Government on this Budget, they must have been struck by the extraordinary comparison between the two speeches to which we have just listened—the speech of my hon. Friend advocating this Amendment and putting to the Committee what he believed will be the result of the adoption of the Government policy, and the answer of the Government thereto. I confidently submit there has not been one word said by the right hon. Gentleman which justifies the resistance which the Government are offering to the Amendment. What has been the defence of the right hon. Gentleman on behalf of the Government? It has been, in the first place, the expression of a hope that the result in future will be the same as my hon. Friend said it had been with regard to this duty when it was first imposed. The right hon. Gentleman said he took note of a statement of my hon. Friend that you cannot force capital into any particular channel, and he dragged in—I might almost suggest he dragged it in by the heels—the question of Fiscal Reform. Right hon. Gentlemen opposite have got it on their brains just now, and they cannot help bringing it in whatever we are discussing; but the right hon. Gentleman himself made a remarkable statement with regard to this tax, in justifying his proposals, of which we take note, too, in regard to the bearing it has on the general defence offered by right hon. Gentlemen opposite for this Budget as a whole. The right hon. Gentleman referred to and placed considerable responsibility upon the action of a previous Chancellor of the Exchequer in the creation of this tax, and we hear now plainly that it is absurd to object to this tax, because it is so small and so little. We did not hear much except from one section of the party opposite about the power of increasing this tax at any particular moment, but we learn now that the Government defend this particular tax at this moment, increased as it is by 10s., by referring to the fact that it was created by a Chancellor of the Exchequer who was a Unionist.

It is obvious that the right hon. Gentleman and the Secretary to the Treasury, and others, have been, and are, really discussing the tax as a whole. I only draw attention to that. I do not-object to it, provided that we are going to dispense with the second discussion on the same subject; but, really, this point with which the right hon. Gentleman is dealing now is quite a different point from the Amendment.

I, of course, cannot say anything with regard to a future debate, but I do respectfully submit that in everything I have said so far I have only followed, as closely as I can, the argument addressed to the Committee by the Secretary to the Treasury. Everything I have said has had reference to the points and the arguments of the Secretary to the Treasury on resisting this Amendment of my hon. Friend.

I fully admit that. He was replying to the Secretary to the Treasury; but the Secretary to the Treasury went beyond the Amendment, and the hon. Member for Lewisham (Major Coates) went beyond it. We must do one thing or the other. We must keep to the Amendment, or else we must have a general discussion now which is to dispense with the general discussion on the Clause It need not prevent a Division later, but do not let us have a discussion now and then have a general discussion on the amount of the tax.

I am not in a position to commit anybody but myself, but I am in a position to commit myself that in the remarks I make now I shall not repeat them in future, and I do venture to appear in the garb of a martyr on this particular occasion, because the two Gentlemen who preceded me have dealt with the question, and I was only endeavouring to deal with some of their remarks. I will endeavour to confine myself to one or two aspects of the case, and to avoid generalities as far as it is possible. I was pointing out that one justification for the tax is to be found in its smallness, but I pass from that. What was the argument used—I think this will be absolutely in order with reference to the Amendment itself—what was the argument used by my hon. Friend? What was the evidence adduced, and which impressed all those who beard him more than anything else? He did not indulge in vague anticipation, but he spoke on behalf of himself, with his own great experience of this business—he spoke, as he told us, after careful inquiry amongst many other business houses, and he, speaking with their authority, said that he believed the adoption of this proposal would drive an immense amount of business away from this country. What was the appeal made by the Secretary to the Treasury at the end of his speech? I listened to it with the greatest regret. It was an appeal ad misericordiam for money, although, as my hon. Friend the Member for the City of London (Sir F. Banbury) pointed out, this tax only represents £150,000.

We will put it at £350,000 in a full year, and the right hon. Gentleman went on to ask whether we were not justified in laying this particular tax upon Canada and our Colonies. Right hon. Gentlemen opposite find it easy to justify this tax by going to a far distant part of our Empire to find this revenue. What is the Amendment we are discussing? It is that this exemption which is now only applied to Government securities should be applied to others, and my hon. Friend the Member for the City advanced a very powerful argument in respect of his plea for its extension to Colonial municipalities, and we have not heard one word from the Government in answer to that, or in defence of the narrowness of their proposal. I do not know whether it is too late. I do not want to say anything which would introduce into this Debate any of those controversial topics which may possibly be kept out, but is it too late to appeal to the Government to meet a case of this kind? I have had no personal experience in this business, but I have had more than one interview with members of leading City firms, and they have assured me that not one of their criticisms

Division No. 712.]

AYES.

[5.10 p.m.

Adkins, W. Ryland D.Benn, W. (Tower Hamlets, St. Geo.)Chance, Frederick W.
Agar-Robartes, Hon. T. C. R.Berridge, T. H. D.Channing, Sir Francis Allston
Agnew, George WilliamBethell, Sir J. H. (Essex, Romford)Churchill, Rt. Hon. Winston S.
Allen, Charles P. (Stroud)Boulton, A. C. F.Clough, William
Ambrose, RobertBowerman, C. W.Cobbold, Felix Thornley
Ashton, Thomas GairBranch, JamesCollins, Stephen (Lambeth)
Baring, Godfrey (Isle of Wight)Brigg, JohnCondon, Thomas Joseph
Barker, Sir JohnBright, J. A.Corbett, C. H. (Sussex, E. Grinstead)
Barlow, Sir John E. (Somerset)Burns, Rt. Hon. JohnCowan, W. H.
Barnard, E. B.Burl, Rt. Hon. ThomasCox, Harold
Barnes, G. N.Buxton, Rt. Hon. Sydney CharlesCraig, Herbert J. (Tynemouth)
Barran, Sir John NicholsonCarr-Gomm, H. W.Crosfield, A. H.
Barry, Redmond J. (Tyrone, N.)Causton, Rt. Hon. Richard KnightCross, Alexander

is in the smallest degree exaggerated. They believe the effect of this will be very serious indeed. This Amendment will diminish the serious character of the proposal. It has the support of the great, almost unrivalled, experience of my hon. Friend who has recommended its adoption in a speech of singular merit—a speech which we all listened to, and it was most convincing; and I think that the defence of the Government is most inadequate and I ask them, even at this eleventh hour, to consider whether they cannot mitigate the hardships of this Clause by accepting the Amendment, which does not involve very great loss to them, and which, at any rate, is regarded by those of authority in the City of London as being of considerable importance and value to them.

The maintenance of the financial interests of this country and of London as the centre of its business is, of course, of supreme importance, and I venture to ask His Majesty's Government, although the exigencies of the present moment are so great in regard to the raising of additional revenue, to be most careful in carrying out the policy of taxation on the raising of loans in this country, so that we may at any rate avoid the risk of diminishing the volume of business which at the present moment centres here. It is well known that in the past London has been in a position of advantage in relation to the possibility of borrowers in foreign countries issuing loans, because we have had a Stamp Duty of 10s.

I really must have this matter settled one way or another. Would it not be better to deal with the Amendment which we have, and get that settled, and then we can go on to this question of amount and got that in order?

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

The Committee divided: Ayes, 200; Noes, 69.

Cullinan, J.Jones, Leif (Appleby)Rees, J. D.
Davies, Ellis William (Eifion)Jones, William (Carnarvonshire)Richards, T. F. (Wolverhampton, W.)
Davies, Timothy (Fulham)Joyce, MichaelRoberts, Charles H. (Lincoln)
Devlin, JosephKeating, M.Robertson, Sir G. Scott (Bradford)
Dewar, Sir J. A. (Inverness-shire)Kekewich, Sir GeorgeRobertson, J. M. (Tyneside)
Dobson, Thomas W.Kelley, George D.Robinson, S.
Duffy, William J.Kilbride, DenisRobson, Sir William Snowdon
Duncan, C. (Barrow-in-Furness)Laidlaw, RobertRoe, Sir Thomas
Duncan, J. Hastings (York, Otley)Lamb, Edmund G. (Leominster)Rogers, F. E. Newman
Dunne, Major E. Martin (Walsall)Lamont, NormanRose, Sir Charles Day
Edwards, Sir Francis (Radnor)Layland-Barratt, Sir FrancisRussell, Rt. Hon. T. W.
Elibank, Master ofLea, Hugh Cecil (St. Pancras, E.)Rutherford, V. H. (Brentford)
Erskine, David C.Leese, Sir Joseph (Accrington)Samuel, Rt. Hon. H. L. (Cleveland)
Essex, R. W.Lehmann, R. C.Seely, Colonel
Evans, Sir S. T.Lever, A. Levy (Essex, Harwich)Sheehy, David
Everett, R. LaceyLevy, Sir MauriceSherwell, Arthur James
Faber, G. H. (Boston)Lewis, John HerbertSnowden, P.
Ferguson, R. C. MunroLloyd-George, Rt. Hon. DavidSoares, Ernest J.
Fiennes, Hon. EustaceLundon, T.Stanley, Hon. A. Lyulph (Cheshire)
Findlay, AlexanderLynch, A. (Clare, W.)Stewart, Halley (Greenock)
Fuller, John Michael F.Macdonald, J. M. (Falkirk Burghs)Stewart-Smith, D. (Kendal)
Fullerton, HughMaclean, DonaldStrachey, Sir Edward
Gibb, James (Harrow)MacVeagh, Jeremiah (Down, S.)Straus, B. S. (Mile End)
Gibson, J. P.MacVeigh, Charles (Donegal, E.)Summerbell, T.
Gill, A. H.M'Kean, JohnTaylor, John W. (Durham)
Ginnell, L.M'Laren, H. D. (Stafford, W.)Thomas, Sir A. (Glamorgan, E.)
Glendinning, R. G.Mallett, Charles E.Thorne, G. R. (Wolverhampton)
Glover, ThomasMarkham, Arthur BasilThorne, William (West Ham)
Greenwood, G. (Peterborough)Marnham, F. J.Tomkinson, James
Gulland, John W.Massie, J.Toulmin, George
Gwynn, Stephen LuciusMasterman, C. F. G.Trevelyan, Charles Philips
Harcourt, Rt. Hon. L. (Rossendale)Meagher, MichaelWalker, H. De R. (Leicester)
Harcourt, Robert V. (Montrose)Menzies, Sir WalterWalsh, Stephen
Hardie, J. Keir (Merthyr Tydvil)Middlebrook, WilliamWalters, John Tudor
Harmsworth, Cecil B. (Worcester)Molteno, Percy AlportWardle, George J.
Harmsworth, R. L. (Caithness-shire)Montagu, Hon. E. S.Waring, Walter
Haworth, Arthur A.Mooney, J. J.Warner, Thomas Courtenay T.
Hazleton, RichardMuldoon, JohnWason, Rt. Hon. E. (Clackmannan)
Healy, Maurice (Cork)Murphy, John (Kerry, East)Mason, John Cathcart (Orkney)
Healy, Timothy MichaelMurray, Capt. Hon. A. C. (Kincard.)Watt, Henry A.
Hedges, A. PagetMyer, HoratioWhite, Sir George (Norfolk)
Helme, Norval WatsonNannetti, Joseph P.White, J. Dundas (Dumbartonshire)
Henderson, Arthur (Durham)Nussey, Sir WillansWhite, Sir Luke (York, E. R.)
Henry, Charles S.O'Connor, T. P. (Liverpool)White, Patrick (Meath, North)
Herbert, Col. Sir Ivor (Mon. S.)O'Donnell, C. J. (Walworth)Whittaker, Rt. Hon. Sir Thomas P.
Hobhouse, Rt. Hon. Charles E. H.O'Shaughnessy, P. J.Wilkie, Alexander
Holt, Richard DurningParker, James (Halifax)Williams, J. (Glamorgan)
Hooper, A. G.Partington, OswaldWilliams, W. Llewelyn (Carmarthen)
Horniman, Emslie JohnPearson, W. H. M. (Suffolk, Eye)Williamson, Sir A.
Howard, Hon. GeoffreyPonsonby, Arthur A. W. H.Wilson, W. T. (Westhoughton)
Isaacs, Rufus DanielPower, Patrick JosephYoxall, Sir James Henry
Jackson, R. S.Priestley, Sir W. E. B. (Bradford, E.)
Jenkins, J.Radford, G. H.TELLERS FOR THE AYES.—Mr. Joseph Pease and Captain Norton.
Johnson, W. (Nuneaton)Raphael, Herbert H.
Jones, Sir D. Brynmor (Swansea)Rea, Rt. Hon. Russell (Gloucester)

NOES.

Acland-Hood, Rt. Hon. Sir Alex. F.Gardner, ErnestPowell, Sir Francis Sharp
Arkwright, John StanhopeHaddock, George BRatcliffe, Major R. F.
Banbury, Sir Frederick GeorgeHamilton, Marquess ofRemnant, James Farquharson
Banner, John S. HarmoodHarris, Frederick LevertonRenwick, George
Baring, Captain Hon. G. (Winchester)Harrison-Broadley, H. B.Roberts, S. (Sheffield, Ecclesall)
Beckett, Hon. GervaseHeaton, John HennikerRonaldshay, Earl of
Bottomley, HoratioHermon-Hodge, Sir RobertSalter, Arthur Clavell
Bowles, G. StewartHill, Sir ClementStanier, Beville
Brotherton, Edward AllenHills, J. W.Stanley, Hon. Arthur (Ormskirk)
Campbell, Rt. Hon. J. H. M.Hope, James Fitzalan (Sheffield)Starkey, John R.
Carlile, E. HildredHunt, RowlandStone, Sir Benjamin
Cecil, Evelyn (Aston Manor)Joynson-Hicks, WilliamTalbot, Rt. Hon. J. G. (Oxford Univ.)
Cecil, Lord John P. Joicey-Kennaway, Rt. Hon. Sir John H.Thomson, W. Mitchell- (Lanark)
Cecil, Lord R. (Marylebone, E.)Lambton, Hon. Frederick WilliamTuke, Sir John Batty
Clyde, J. AvonLong, Rt. Hon. Walter (Dublin, S.)Valentia, Viscount
Corbett, T. L. (Down, North)Lowe, Sir Francis WilliamWalker, Col. W. H. (Lancashire)
Craig, Captain James (Down, E.)M'Arthur, CharlesWarde, Col. C. E. (Kent, Mid.)
Dickson, Rt. Hon. C. ScottMildmay, Francis BinghamWilloughby de Eresby, Lord
Douglas, Rt. Hon. A. Akers-Morpeth, ViscountWinterton, Earl
Faber, George Denison (York)Morrison-Bell, CaptainWortley, Rt. Hon. C. B. Stuart-
Faber, Capt. W. V. (Hants, W.)Nicholson, William G. (Petersfield)Younger, George
Fell, ArthurParker, Sir Gilbert (Gravesend)
Fletcher, J. S.Pease, Herbert Pike (Darlington)TELLERS FOR THE NOES.—Major
Forster, Henry WilliamPeel, Hon. W. R. W.Coates and Sir W. Bull.

moved, after the word "securities" ["other than Colonial Government securities"], to insert the words "Indian securities."

I have purposely phrased my Amendment in these terms because I did not know what was going to be the fate of the word "Government." If the Amendment took the form of "Indian securities" or "Indian Government securities," or "securities guaranteed by the Indian Government" it would equally well serve my purpose. I am aware that there are not now very many of the railway Debenture bonds which were issued at 5 per cent. by the Indian Government. Most of these have now been redeemed because the Government has bought the lines, but even in regard to lines which have been acquired by the Government Debenture Bonds are now issued, and presumably will be issued in future, and I should like to see them excluded. If the Indian loans have a composition Stamp Duty, the same applies equally in respect of Colonial Government securities, so that that does not appear on the face of it to be an argument against the small Amendment which I wish to bring about on behalf of Indian securities. Suppose a railway now wishes to raise money without a guarantee, as I believe will happen very frequently in future, it would raise its money subject to this extra Stamp Duty, which I think is to be somewhat deprecated. It would be just in the case of such loans that such exemption as I suggest should be made. Nor can I see any objection to giving a preference in this respect to India. The hon. and learned Member (Mr. T. M. Healy) asked why Ireland should not have a preference. I have sat here in vain now for four years if Ireland does not always get an enormous preference on every occasion, something compared with which the slight preference that I mention here is an absolutely negligible quantity. The insertion of the words which I suggest would not in any way affect securities which are always excluded. Therefore, the amount of the exemption will be very small. At a time when India is agitated by wanton opposition to the Government, it becomes a Member, on every occasion when he thinks that an exemption on her behalf should be entered, to get up and suggest it. The importation of British capital into India is, above all things, to be desired. It is the one thing necessary for her future development, and, at a time when the introduction of British capital is being impeded by wanton agitation, often supported—to my deep regret—by those who should know better in this country, it is desirable that every opportunity should be taken of seeing that, in a small matter like this, justice should be done.

In any case the actual words proposed would not be suitable even if I were disposed to accept the principle which is contained in them. Securities is a word of very wide and rather indefinite meaning. It will cover all sorts of things. It does not in any way specify whether the securities are to be raised in India, or whether they are to be in connection with loans raised in India, or with loans raised in this country and issued in India. But in any case, even if the words were more suitable than they are, I do not think it will be possible to make the concession in the case of Indian securities which we are prepared to make in the case of Colonial securities. The case of Indian Government securities is already met by the composition between the Indian Government and the Treasury. My own experience of the India Office was that the financial authorities there were as capable of making a good bargain on behalf of India as any people in this country. I do not think we can re-open the question, which has already been settled, and we cannot make the concession.

The Amendment only deals with short-dated bonds which are issued occasionally by the Indian Government, but very often by Indian railway companies, guaranteed by the Indian Government, and now when the vast majority of the Indian railways have been bought by the Indian Government these short bonds are issued generally with from three to five years to run. These are bearer bonds passing from hand to hand. They are the only Indian form of security, as far as I remember, which is issued in that form. Am I to gather that they will not be included in this particular Clause? As far as I can read the Clause and the Stamp Act of 1899, they will be included. If they will not be included the hon. Member has no reason to move the Amendment, but we should know for certain whether or not these particular bonds would be included in this Section. The bonds are issued at a low price—probably money borrowed at 3 or 3½ per cent. or even less—and it is evident that if you put upon them a tax of £1 it adds 4s., if it is a five-year bond, to the interest, and if it is a three years' bond it adds 6s. 8d. per year.

The hon. Baronet has raised a question of great difficulty. The companies which work the railways pay rent to the Indian Government, and have control over the policy of working, but there is practically no connection at all with the State.

They have this connection, that the Indian State is responsible for principal and interest.

That is true. They are guaranteed, or some of them are, but by no means all. The connection of the State is therefore a very difficult and a very anomalous one. I do not think these securities are recognised in any sense as a Government security, though in many cases the guarantee of the Government is behind the company, but it is not a Government security in the strict sense of the word. The Government could not really accept the Amendment.

It is evident from the speech of the right hon. Gentleman that these particular securities would be covered by this Clause, and I hope my hon. Friend will go to a Division.

I do not want to be contentious about the matter, or I might argue that, I was willing to accept the words "Indian Government securities" and such words can be no more indefinite than the word's "Colonial Government securities." However, I readily subscribe to what the hon. Baronet said about the position of Indian railway boards which manage these companies, and if he would look into the matter, in case he should find there is more in my contention than he thinks, I will withdraw.

Amendment, by leave, withdrawn.

I beg to move the addition of the following words to the Clause: "The above increased duties only to apply to securities issued after the first day of November, nineteen hundred and nine." My reason for moving this Amendment is that in the replies given to two questions on this subject it was stated that the duty on bonds to bearer should not be retrospective. If that is so, there must be something put in this Clause to prevent the duty from being retrospective. I am not particularly enamoured of the words I propose, and I will accept any form of words which will have the effect of carrying out what I understand to be the intention of the Government. It is manifestly unfair that a person who has at present a large holding of bonds to bearer should if he suddenly sells these bonds in London, be mulcted in 10s. per cent. duty in order that they may become legal tender. That would mean a serious loss, particularly if that person happened to be the owner of a large parcel of bonds. If this duty were to apply to such bonds he would desire not to sell them in London, but to export them to Amsterdam, New York, or elsewhere to be sold, and in that way the commission to the London banker would be lost, while at the same time the money would go out of the country. I am not one of those who are opposed to capital leaving the country. I agree with the hon. Member for Lewisham (Major Coates), who said that trade follows capital, and that if you lend capital to a foreign country it means trade to this country. Consequently I say it is our duty to do everything we can to encourage capital going out of the country. I desire to ask the Government whether they are willing to accept this Amendment so that the duty on bonds to bearer will not be retrospective. I earnestly hope that they will be able to accept this Amendment or something similar.

I hope the Government will accept this Amendment, which is extremely important. When the matter was last dealt with, in the Finance Act of 1899, it was carefully provided by Section (1) of Clause 4 that bonds of this description should not be liable to increased duty. As I understand, increased duty was not put upon bonds which had already been made liable to duty. Bonds issued before 1899 always passed, provided that they were stamped with the stamp due up to 1899. Therefore, we have a precedent in favour of the Amendment moved by the hon. Member for Mile End (Mr. Straus). Under this Clause the increased duty will apply not only to bonds or shares issued after the passing of this Bill into law, but to every bond or share at whatever time issued. That is a very great change in the custom under the Stamp Acts. It is a change which will have this effect: People who hold these bonds or shares will take every means in their power to avoid paying the duty when they find that the securities are subject to this additional Stamp Duty. Where they are transferable or negotiable in other countries, the probability is that, instead of being negotiated here, they will be negotiated in other countries, and nothing will accrue to the revenue.

I do not think the words as they stand in the Clause will have the effect which the hon. Members who have spoken think they will have. It is certainly not the intention of the Government that the new duty should be charged on these bonds. Before I accept the words of the Amendment I would like to consider the matter. If it is necessary to make an alteration, I will bring up words which can be inserted on Report.

Amendment, by leave, withdrawn.

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

In this discussion scrupulous care has been taken not to drag in any reference to controversial politics. At the same time I do not think it is right that this Clause should be allowed to pass without any reference to the effect of the policy contained in it and to the general policy of the Government. During the last four or five years—in fact ever since the fiscal question was first brought before the country—we have had repeated declarations by Members of His Majesty's Government that one of the great dangers, in fact the greatest danger, of Tariff Reform was that it would interfere with financial business being done in London. We have been told over and over again that finance is a most delicate plant, and yet what do we find the Government trying to do? They propose to double the tax on the financial operations of this country. I think it is most important that that should be taken into consideration in connection with the general policy of the Government. I do not think that Free Trade is very fortunate in the way it is supported. When we come to consider what effect this tax will have upon financial operations, I think, looking to the statements which have been made by leading financial authorities in the country, and to what has been said here this afternoon, there is not the slightest doubt that the enormous operations going on in the City of London will be jeopardised. It is harder every year to get financial business in this country. The struggle going on in that department of commerce is like the struggle which is going on in everything else. The effect of the increased tax in Paris has been to drive an enormous amount of business away to Brussels. When in Brussels recently I talked to a leading financier, who told me that he had read with delight of the proposal of the British Government in regard to the Stamp Duty. He said he believed that the financial business of Brussels would increase enormously when the new duty came into operation. Having regard to the delicate state of the financial market, I do not think that the Financial Secretary to the Treasury has gone so far as to say that this tax may not have a serious and injurious effect. The Government do not deny that this increase of the tax will have a bad effect, but apparently they have only included this in the Bill because, as the Chancellor of the Exchequer has told us, it is necessary to get money somewhere. He thinks it necessary to get it by increasing the duty on financial operations instead of taxes on motor cars imported, and certain luxuries which we import from foreign countries. That is what the Liberal party call defending the citadel of Free Trade. [Laughter.] Hon. Members opposite may laugh, but, if it were not that I should be out of order now in going into details, I would endeavour to show that the policy of taxing imports would be better than that now proposed. I make this protest against imposing a duty which will hamper one of the really flourishing businesses of the country.

I desire to say a word on this Clause in order to justify the vote I reel compelled to give against it. I listened attentively to the reply of the Secretary to the Treasury, who only gave one justification for the tax. He did not attempt any other. He said in effect: "I admit that the tax proposed by this Clause is an undesirable one. I admit the impeachment of the hon. and gallant Member for Lewisham. I have no technical experience in this matter, and I am not in a position to traverse the arguments he brought forward, but nobody has been able to suggest any other method of getting this money." If the Secretary to the Treasury puts the case in that way, he necessarily invites suggestions from Members of the Committee as to how he can get the money without imposing this tax. I venture to put forward that if the Secretary to the Treasury would only put upon gambling operations the same penalty which falls upon legitimate investments, which I will endeavour to explain later on, he will find all the money he requires. I, for one, protest against the suggestion that this tax can do any good whatever, and it must of necessity do an immense amount of harm and disturb the whole Stock Exchange of this country to the advantage of the opponents of the Government. Under those circumstances I would venture to ask the Secretary to keep his mind open until we get to the next Clause, so as to see if there is not some other way of getting the money.

I do not propose to suggest to the right hon. Gentleman any way by which he can obtain £150,000 this year and £350,000 next year, the amount which he hopes to get out of this tax. It is not my business to suggest to the right hon. Gentleman how to obtain money. I would like to add my tribute to the speech of my hon. and gallant Friend (Major Coates). He pointed out that this particular tax handicaps the negotiation of Canadian bonds in this country, because, as he said, in the country on the frontiers of Canada the people paid no tax either on bonds or shares to bearer, and consequently American financiers were able to compete much more successfully with the Canadian bondholder than the English people over here, who are handicapped by the tax of £1 per cent. That does not apply only to Canada, but to all the foreign countries of the world who are desirous of raising money, and used to come to this country and used to consider that this country was the chief money market of the world. The hon. Member for Louth (Mr. T. M. Healy) early in the afternoon stated the reason why other countries came to London to borrow money was because London was the cheapest market in the world. That was so 15 or 20 years ago, but it is not so now. As will be seen from the statement which the right hon. Gentleman made only yesterday, in reply to a question addressed to him by some Members on this side of the House, he had to admit that during the last year—a period of very cheap money, which has always' a very great effect in enhancing securities—while every foreign Government security had gone up, Consols had fallen.

You can get money as cheaply at the present moment in the United States as in England. You will find that in the last few years large parcels of bonds, which in the old days would have been dealt in here, have been dealt in in the United States, as it was impossible to find a market for them here.

The same rate of interest. Of course, the people who desired to borrow money found that they borrow it more cheaper in America than here. I do not want to exaggerate the effect of this tax—I think it a great mistake to do so—but I believe that it will be to drive out of this country a large quantity of bonds which come over here. That is to say, the person who desires to borrow the money will be able to borrow without coming to this country; therefore the financial business of this country will be dislocated. It must not be forgotten that the placing of bonds every year is not the only advantage which this country derives from the fact that these securities can be negotiated here. There are other things which follow the negotiation of money over here. Take a Canadian railway which raises its money here. The object of that line is to do certain things for the advantage and use of the country. The money being over here they naturally say, "We must see if we cannot buy the materials for our railway in this country." If they go to some other country they will try to buy their materials in the country where they have their money. This covers a great many other things besides Stock Exchange transactions. I have the pleasure of seeing the hon. and learned Member for Reading (Mr. Rufus Isaacs) opposite me. He is a great authority in these matters, and I am inclined to think that he will not disagree with the remarks which I have made as to the results which would arise from the increase of this tax, the tax being already ½ per cent. Of course, it does not affect private individuals. A private individual desires to buy a security which is subject to this tax, and he must go to a broker or a bank and buy, and he has got to pay the tax whatever happens; but the man who knows his way about the City, the rich firm or the big bank, who really accounts for the greater part of the transactions in these securities, can buy them abroad. There is no necessity for them to buy them here in England, and having bought them abroad they do not particularly desire to have their security over here in their own hands. The private individual likes to see his bond and look at it, and know he has got it, and he has got to do it through a broker or a banker, and therefore Somerset House can compel him to pay the extra stamp on these bonds. His broker is bound to see that it is done when he delivers it. I see the hon. Member for Newmarket (Sir C. D. Rose) is present. He is also a great authority on this matter. I venture to make the statement that if the hon. Baronet the Member for Newmarket was now in the City, and he saw any reason to desire to invest £100,000 in an American railway, he would not send the order to the London Stock Exchange, because he would have to pay the stamp unless he could happen to buy the bonds already stamped; and if the answer came back, "You will have to give 1 per cent. more because we shall have to buy the bonds in America," the hon. Baronet would say, "That will not do; I shall send over to New York and buy them there." He can contradict me if I am wrong. But the hon. Baronet being a man of resource and great intelligence, besides being a man of capital, would evade the duty, while the ordinary investor would be caught.

The Prime Minister told us the other day it was a very good thing the money went abroad. The Prime Minister, not having the resources of the hon. Member for Newmarket, could be compelled to pay the extra 1 per cent. Possibly if he were here he might back me up, and divide against the Clause, or put sufficient pressure on the Secretary to the Treasury to drop the Clause. If that is to be the effect of the tax—and I believe it will be—the Treasury will get nothing. The result will be as in the case of the Spirit Duty. When you put a tax on an article which is more than it can bear the only result is that it drives out the particular commodity, that you destroy its use, and prevent it circulating as it would have done if the tax had been lighter. I had two quotations, one from the President of the Board of Trade, in support of this contention, which were handed to me by an hon. Friend of mine just now. It is taken from "Hansard" of May, 1902:—
"If ever in this country the incidences of taxation falls so as to make this country not a good country for capital, so as to displace it from its position as the clearing house of the world, then, indeed, the whole of the vast structure of our credit and authority will come clattering down, and the only choice we shall be able to offer the manufacturing multitude in England will be to emigrate or starve."
I have another quotation from a little book edited by the hon. Member for Blackburn (Mr. Snowden) from an article headed "The Socialist Ideal Budget." He has met the point of the right hon. Gentleman, and has offered another alternative-In this ideal Budget he omits stamps altogether, and the reason he gives for doing that is to relieve business of the Stamp Tax on commercial transactions. There are two great authorities, the right hon. Gentleman the President of the Board of Trade and the hon. Member for Blackburn, who would desire to relieve commercial transactions of stamps. But the right hon. Gentleman is doing absolutely the reverse, because, instead of relieving commercial transactions of stamps, he is doubling their incidence. As I have pointed out, this tax will have a bad effect on commercial transactions, and at the same time it will not bring any very great increase to the Treasury, and for those reasons I shall vote against it.

The hon. Baronet who has just sat down quoted, in concluding, some observations of my right hon. Friend the President of the Board of Trade. Those observations, if I remember aright, were made when he was in sympathy with the hon. Baronet opposite, but he has now proceeded on a wiser path. But there was one serious argument produced by the hon. Baronet. It was to the effect that foreign countries used to come here, but that now they have given up.

That they are diminishing, and that if we impose this tax they will still further give up the practice which obtained in former times and go somewhere else to seek their capital. The investor will go to the market in which he finds he can get what he wants. Last year, as I pointed out in previous remarks made to the Committee, we lent to Canada something like £40,000,000 of money on terms which were mutually agreeable to the vendor and the borrower. That was done in spite of the fact that there was a Stamp Duty of 10s. per cent. upon the transaction.

6.0 P.M.

It is a question of proportion between the two, but what would be £1 now was 10s. previously. At the same time that the hon. Baronet pointed out this state of things he and his Friends had been for some time lamenting the exportation of capital from this country to some other countries. I should have thought if the tax had the result which he hints it will have, but which I confess I cannot admit, and must deny, the hon. Baronet ought to be pleased with the result, because the exportation would cease under the operation, and his desire would be gratified. I do not wish to press that point too far.

I gather from the right hon. Gentleman that we ought to be pleased with this tax, because it would prevent the exportation of capital abroad, That is because people will buy straight from abroad instead of buying here, but at would prevent the Government from getting Stamp Duty.

That is an extension of the hon. Baronet's argument. I think the case that he put originally was what I suggested. It has been said that I have admitted that this particular tax is undesirable. I admit that; but I go very much further, and I say that all taxes are undesirable in themselves, and they are only imposed with great reluctance. To the extent to which they exist every single tax is a hindrance of capital, is a burden upon the person who pays the tax, and is in itself undesirable, I do not care under what form or under what system it is imposed. I make hon. Members a present of that observation, which I believe is shared by hon. Gentlemen on both sides of the House. I do not propose to address the Committee at any greater length, because we have had a very considerable discussion in the earlier part of the afternoon on the merits of this Clause, and the arguments of the Government have already been put before the Committee. I repeat again, that it is regrettable that taxation should have to be placed upon this or any form of capital, yet I do not think that this tax will have the injurious or disastrous effect that is predicted by hon. and right hon. Gentlemen opposite.

I shall most certainly vote for the omission of this Clause from the Bill, and I shall give that vote with complete satisfaction and in the very firm belief that it is in the interests of good finance and good Government that the Clause should be rejected. I look upon it as one of the very worst illustrations to be found in this Bill of the attempt on the part of the Government to obtain the minimum of revenue in the shape of an arrangement which will impose the maximum of inconvenience and disturbance. The right hon. Gentleman said he did not wish to repeat arguments which had been previously used by the Government in defence of this Clause. I venture to say that neither in the speech to which we have just listened, nor in the speech delivered earlier in the afternoon, has there been one single argument advanced in justification of this particular form of taxation. We have been told by the right hon. Gentleman that all taxation is objectionable, and so on. We hear that about once in every three speeches made from the Government Bench. Everybody knows it. While all taxation is objectionable, and all the rest of it, some taxation is especially objectionable, and some of it imposes a specially objectionable burden. It has been pointed out by my hon. Friend that the Secretary to the Treasury has, admitted the badness of this particular proposal. I indulge in this surmise, that hon. Gentlemen, who have been in the House to-day, and who have listened to this Debate, if they could vote regardless of the fate of the Government and of their political proclivities, would do so with a majority that would be overwhelming. Where have been its defences? We have had two speeches from the Front Bench containing no argument—I say it with no, disrespect to the right hon. Gentleman. I do not think there has been any argument advanced in support of this proposal except those generalisations in which the right hon. Gentleman indulged in his last speech. We have had condemnation of, the proposal from all quarters of the House, and we have had concessions made by the Government in deference to the irresistible case put forward; but we have had no argument in defence of the proposal itself. The Secretary to the Treasury, dealing with the speech made by my hon. Friend behind me, said, in his first speech, that finance is a delicate plant. I am informed that so delicate is the nature of these transactions that a very small tax placed upon them has the effect of becoming in some cases absolutely prohibitive. I am assured by those who know, who have no interest other than to place the facts of the case before the Committee and the country, and who are engaged in these transactions every day, that this particular form of tax will be destructive in its effect on a large class of business. I was assured only the other day that in one case on a whole series of these transactions—I am sorry to say I have little personal experience of these matters, I wish I had more, but I assume that the figures they showed me are correct—the increased burden of taxation would prevent some of this business from being carried out. The remarks which fell from the Secretary to the Treasury with regard to that branch of the question seemed to me altogether irrelevant, and hardly worthy of serious debate. The Secretary to the Treasury says we have no alternative proposal. It is not our business to make alternative proposals; but I must say I should have thought that, so far as the Rules of this House permit, every sort of alternative suggestion has been made at one time or another in the course of the Debate. I understand what the right hon. Gentleman means is that these City representatives who brought the case before the Government and pressed it upon them ought to have produced an alternative suggestion, and, having failed to do so, this tax must stand. We have it admitted that you are interfering with the business, not only of the City of London but with business which enormously concerns many of our Colonies. That is admitted; nobody has attempted to deny it. I wish to protest against this Clause, because I believe it to be one of the strongest illustrations out of many of the badness of the foundation on which the Budget rests, that it will do a vast amount of harm, producing the maximum of inconvenience with the minimum of revenue, and that it has been introduced in opposition to the best expert opinion which has been brought to the consideration of the question.

I earnestly trust that the Government will, at the earliest possible moment, consider the question of reducing this tax if it is found to interfere with the great financial transactions which have hitherto centred in London, because of the advantage which freedom from taxation—10s. per cent. being the amount of the stamp—allows here. One point of danger in the future, in my opinion, is America, which has been free from Stamp Duty in the past, and has not had capital available for the taking of these great loans. But that is rapidly passing away, and consequently we shall find that America in future will more readily and more rapidly enter into competition for the placing of these issues. As a Free Trader I object to putting a tax upon a market—whether on financial transactions or goods—as far as the interests of our revenue will allow. When we remember the great Colonial loans, I should have been glad if, by Amendment, exemption from the increase could have been made applicable to the municipalities of the Colonies, because from time to time, and there will be in increasing amounts, money required for municipal purposes by all the great cities of our Colonies, and we naturally would hope that such loans would find their home in the London market. If a Colonial municipality desires to float a loan, say, of half a million of money, they come to London and ask for quotations. Financiers sit down and calculate, as the hon. Member for Lewisham put so clearly a few minutes ago, that there is a charge of 8s. 9d. for incidentals and a charge of 10s., and they make their estimate and underwrite the loan for a given sum. Now you are narrowing the margin by the increased amount with which it is to be weighted. Supposing that in future America enters the list without a Stamp Duty, it will, of course, have a greater power to undersell us. Whilst we have had 10s. in the past, and Berlin 12s. 6d., Berlin is now increasing that rate, France has levied a £2 Stamp Duty, now being increased; therefore, we have been in a position of advantage. I should have been glad if the Government could have given a 15s. per cent. Stamp Duty for the municipalities; but as the exigencies of the moment are so great the Committee can pass this in the hope that the time will soon come when the £350,000 will not be a matter of such great moment as it is to-day, and I trust that the great financial interests of London will be made freer, because Free Trade principles shall be applied to finance as well as to imports.

I listened with the greatest interest to the speeches which have been made, especially that of the hon. and gallant Member for Lewisham, who contributed so much to our stock of information and knowledge of this subject, and to whom this Committee is very much indebted. But, while agreeing with nine-tenths of what he said in respect of this matter, I differ from him in the conclusions at which he arrived.

I desire to address myself for a moment to some of the observations made in reference to the policy of this Clause, because it seems to me that the whole of his argument was based on showing that in respect of the Colonial and municipal loans the margin of profit was not sufficient to allow our great financial houses here to cope with the extra duty which will be imposed. Let me point out that what we are discussing is not that issue, but the far broader and more general proposition of an increased duty on the bearer bonds, which would apply to all foreign securities, and that there has not been one word said in the argument in this House which in the slightest degree bears upon that proposition. What the Government intends to do by these duties is to raise the stamp upon bearer bonds of all foreign Governments, not of Colonial Governments or Colonial Provincial Governments, which are exempted by what has been said to-day. It is very remarkable with the great authorities on finance which we have on the other side, and I know the hon. Member for the City (Sir F. Banbury) and the hon. and gallant Member for Lewisham are great authorities, that not one word has been adduced against this tax in so far as it will operate upon the securities of foreign Governments. It is those Governments which, in the main, will be responsible for the taxation which is imposed by this Clause. Therefore, dealing with the more general proposition which has been put forward, I venture to submit to the Committee that there has not been a single argument adduced in the whole of the discussion against the Government proposals.

In reference to what was said by the hon. and gallant Member for Lewisham as to the effect on Colonial municipal bonds, I confess I thought there was a great deal more to be said in respect of that point. After listening to him most carefully, I think it seemed to be the echo of an argument which is used often here in respect of other proposals of increased taxation, of any increased burden upon trade. That is a kind of argument which is used over and over again, and I am perfectly certain by the hon. and gallant Member with absolute honesty and sincerity. It is said that trade will be destroyed when we impose this further taxation. I am sure everybody is familiar with that kind of argument in reference to another department of taxation which has been discussed in this House on many occasions. Again and again we have been told that trade would be destroyed, and the same observation applies to what has been said by the hon. and gallant Member. I do not profess to have anything like the knowledge and experience of the finance of the City that either of the hon. Members to whom I refer must have, but I have sufficient to know this, that I am quite certain that the resources of the hon. and gallant Member and also of those great financial issuing houses in the City will be quite equal to coping with the increased strain put upon them by further taxation in the shape of this Stamp Duty, and that we shall not lose this business any more than the trade or business will be destroyed, which we have heard so often in another connection.

I do venture to submit to the Committee that we need not at any rate fear in this respect that there will be any great loss to the revenue, because if all we have heard from the hon. and gallant Member for Lewisham is true, and if all the argument-was based on his own personal knowledge and experience with reference to these Colonial municipal bonds, and if it involved this that there would be no means of in the slightest degree meeting the extra taxation, still the loss which would be incurred by the country in respect of those matters is comparatively small. And again, so far as the revenue goes compared with the loss that would be incurred by omitting this Clause altogether, and thus losing the great benefit of the increased burdens in respect of all the other foreign Government securities, of which we have heard nothing throughout the whole course of this discussion, I submit that this Clause is one which really imposes no very great burden upon the finances of this country, and is one which will produce, as we understand from the Financial Secretary, £50,000 this year and £350,000 in the years to come. The argument which has been addressed with reference to the Colonial municipal bonds would only really affect a very small portion of that, and therefore I submit that this Clause is eminently desirable.

I agree that the case of the hon. and gallant Member for Lewisham (Major Coates) is an entirely hard one, and that it was a very proper case to bring before the House. The margin on that class of business is undoubtedly very very small. I do not agree with a great deal of what has been said by the hon. Member for the City (Sir F. Banbury). I think the hon. and gallant Member for Lewisham will bear me out that municipal securities in which there is such a small margin are not considerable, and very often, although they may not be secured here in the first instance, they nearly always come back here in smaller amounts. I can assure the hon. Members that the margin of profit on negotiations from foreign loans is not a fine one, and there is ample margin to pay this extra stamp, and give them all a very large profit; indeed, I do not fear that this will interfere with the circulation of securities. I call the attention of the Secretary to the Treasury to what the hon. Baronet (Sir F. Banbury) said as to evasions, and I hope he will bear it in mind and have the Stamp Act altered so as to protect the country against the gross evasion of the taxes as they go on now, and which I do not suggest hon. Members are responsible for. In the case principally of American railway securities, if they are purchased by a stockbroker here, they have to pay the Stamp Duty, but the broker may say, "I can get them for you in New York without any stamp in a different form." They are rendered as if "secured" instead of purchased. Those bonds come over from New York, and have no stamp. Hundreds and thousands of pounds might have been obtained if the Act had been different. As to short date bonds, speaking not as a party politician, I do not believe, although there may be cases where the margin of profit is very small, that it does not affect the country or its prospects. On the great, large loans of foreign countries which are negotiated here there is an ample margin to bear the additional stamp.

The hon. Baronet (Sir C. Rose) has drawn attention to the great manner in which evasions are carried out, and that was only confirming the statement I made that I thought the result would be that evasions would take place, and the Government would not gain anything. I understood him to say he had bonds in his own possession, and was breaking the law himself.

It is not an evasion of the law at present. I wished that the Stamp Act would be altered to bring them within the law.

I will leave that point. The hon. and learned Member for Reading (Mr. Rufus Isaacs) said that the only argument that had been brought forward was as to Colonial securities, and that the enormous amount of foreign securities dealt with had been left out. There is a vast mass of American bonds and shares that would be tremendously affected. The hon. Baronet the Member for Newmarket (Sir C. Rose) admitted that the Act is not retrospective, and would only affect new issues. I never attempted to deny that in the issue of a large foreign loan in all probability there would be sufficient margin to allow 1 per cent. Stamp Duty being paid; but it must not be forgotten that now, for the first time, or rather within the last ten years, other countries are competing with us for the issue of those large foreign loans. Take the Russian and Japanese loans, the two largest issues in that time, and remember both those issues were placed in other countries They were placed in Paris, in Brussels, in America. It must not be forgotten we gave preferential treatment for our own loans during the Boer War, showing that this country is no longer the money market of the world. There can be no doubt if 1 per cent. is added the Dutch, Belgian, and Americans will be able to compete on better terms. When once those securities-are issued you cannot deal with any part of the loan in London which has been issued abroad unless you pay Stamp Duties. Therefore you are limiting the market in London. It is a very bad thing to introduce any limitation, and it is against the interests of the people to prevent a free share market. The best possible thing is to have as free a market as possible in shares and bonds. Therefore, I say that the speeches of hon. Members opposite have tended to show that the Clause is a bad one, and that if they followed the bent of their own minds they would vote against it.

Notwithstanding what has been said on the other side, although I have heard every word of the Debate I shall support the Government. I do not take that course because I like the tax. I know as well as any man in the House that a tax or duty on any article must tend to hamper the market. That is one of the reasons why I am a Free Trader. But the object of this Budget is to put upon the shoulders of the different classes of the community their fair share of the burden of the extra millions which it is necessary to raise. Therefore, the Stock Exchange ought to bear its share, and I do not think that this is an unfair share to ask them to take. I wish particularly to refer, however, to the remarks of those hon. Members who seem to think that a tax of this kind on securities must kill he market altogether, and that there is no precedent for it. In France there is a 1 per cent. or 2 per cent. duty, but it has neither spoilt nor even hampered the market in these bonds. In Berlin they have a heavy stamp duty, but although the same arguments were used when it was adopted, those arguments have not fructified, and I maintain that the arguments which are being used to-day will equally fail to be confirmed by experience. This Clause does not relate to securities in general, but to bonds to bearer or bearer bonds. The bulk of these refer to either Colonial securities, which are largely exempt, or to foreign securities. I cannot understand how hon. Members opposite, who think it is so bad for the interests of this country to export capital abroad, can vote against this Clause which they say will tend to prevent our capital going to foreign countries. If they are right in their contention that it is a bad thing for English capital to go to foreign countries, they ought to support this Clause. If, on the other hand, they believe, as the hon. Member for Lewisham (Major Coates) so ably explained, that trade goes with the loan, as, of course, it does, they must know that their apprehensions have really no foundation. I do not believe that we are going to lose business through this Stamp Duty. I agree that it will tend to hamper business, and anything which does that is bad. At the same time we have to find this money, and those who will have to pay this extra sum must not object to bearing their fair share of the burden. Amsterdam has no stamp duty on bonds; therefore, if a stamp duty kills business, the whole of the trade in these bonds ought to go to Amsterdam. But it does not. The trade in these bonds has increased in London to a greater extent than in Amsterdam. The trade in these matters must always go where the money is, and money goes where confidence is. [OPPOSITION cheers.] Yes; I say chat confidence goes where trade is; trade goes where there are fewer taxes and greater facilities for inter-communication and exchange of goods; where there is the best choice of goods there trade goes; and as long as we keep our markets open for foreign goods for which we pay in manufactured English goods, we shall retain this very valuable market. Confidence must be lost to some extent when people in responsible positions continually cry that we are suffering from want of confidence, that we are going to the dogs, and that other countries are beating us. They repeat it so often that they believe it themselves. That is the kind of thing we are suffering from to-day. As far as our stability is concerned, there can be no question that we are still second to none. I am sufficiently an imperialist or a Big Englander to believe that we are still as good as anybody else, and a great deal better than most. I shall with confidence support the Government on this Clause, and I trust that those who vote against it will remember that they are voting against their own arguments, namely, that it is a bad thing for British capital to go abroad and that this Clause will tend to prevent British capital going to foreign countries.

In reference to remarks of the hon. Member opposite (Mr. Straus), I would say that the fewer hindrances to trade there are the better. So far as foreign loan business is concerned, a short time ago there was a loan issued by the city of Copenhagen, and the French, although they had a heavier duty to pay, were able to beat the British tender by a sum of £2,000, and they obtained the loan. If we had had to pay this extra ½ per cent. the difference would have been still greater. As to the inadvisability of putting hindrances in the way of the issue of foreign loans of this country, I would refer to one or two loans which have been issued lately. The City of Moscow Loan recently was taken up by British capital. What was the result? Orders to the extent of many hundreds of thousands of pounds came to this country to electrical manufacturers, the builders of railway waggons, the makers of rails and all sorts of appliances for the trams which were to be constructed in Moscow. Had it not been that British capital had been able to acquire that loan those large orders would never have been secured. Similarly a short time ago there was another Russian loan issued by a place near the Black Sea. After considerable negotiation and trouble, that loan was obtained by England, and I would like to bear testimony to the fact that the President of the Board of Trade used his best endeavours in assisting the English party to obtain that loan against the competition of foreigners. This extra ½ per cent. would probably have meant the loss of the loan. In that loan there was a condition that as far as possible English work should be employed, and an English director was put on to see that that condition was carried out. By imposing this extra ½ per cent. we are going to throw away the advantage by which we are able to get extra work for this country. I could give the names of half a dozen loans which have been secured by the French, notwithstanding their higher rate of duty. This extra ½ per cent. will mean that we shall lose far more than we do at present. That is a very serious matter. Personally, I am not much interested in the financial part of the transaction; but the considerations of finance and work for British people are so intermingled that you cannot separate them. If you find the money you get the work; if you do not find the money you do not get the work. If you want to build engines or to sell rails, electrical appliances, or materials of any sort, you must be ready to assist in the finance. Germany have their representatives at every commercial centre to push their business and to assist their manufacturers wherever they can. As I say, the President of the Board of Trade did that in the instance to which I have referred, but, as a rule, very little assistance is obtained from the British Government for British manufacturers in this way, and the present opportunity of mixing our finance with our work is to be taken away by the reduction in our relative superiority in the matter of these Stamp Duties. It is an enormous advantage to have the low Stamp Duty of only ½ per cent., but the Government now propose to take that away. It means very little to the Government, but it will cost the manufacturers and labourers in this country far more by preventing them getting their fair share of work for foreign countries.

I think that the hon. Member for Reading (Mr. Rufus Isaacs), in his desire to come to the rescue of the Government, did not do either his case or himself that justice which we expect from his unique reputation in his profession. His argument came to this: That the case which the hon. Member for Lewisham (Major Coates) had made out might be good in regard to Colonial stock, but there was nothing much in it as regards the larger subject of foreign loans. In other words, the hon. Member said, "Tell the Colonies when they want money they must go to foreign countries for it, and not to the Mother Country." That, to my mind, is not a very attractive alternative to the baits which are being held out by other countries for the trade of the Colonies, and it strengthens my determination to vote against the Clause.

They are exempted from the Clause, but the hon. and learned Member's point was that there might be a very narrow margin of profit in regard to Colonial loans and securities, but that did not much matter, because there was plenty of profit on foreign loans and securities.

I wish to thank the Financial Secretary for his courteous reply to my few remarks, and I would like to make an appeal to him. He mentioned in his speech that during last year some £40,000,000 had gone from this country to Canada. It is true that probably more than that amount has gone to Canada, and a far, far greater percentage to Colonial Governments and Colonial Provincial Governments on which the half crown duty was payable, but a very small portion to Colonial municipalities. I possibly should have directed my attention more to foreign Governments, and should have been very glad to do so, only I felt that other hon. Gentlemen would take up that matter. I directed my few remarks to Colonial municipal bonds. When the bankers came to the Government I understand that there was a 'suggestion to increase the bill stamp. They brought before the Government cogent reasons against putting a very small percentage on the 1s. per cent. duty on bill stamps. They said that it would be ruinous to put it on a business dealing in bills of exchange, and that very much business might be lost. On that the Government gave up the idea of the duty. I appeal to the Chancellor of the Exchequer or to the Financial Secretary to say whether or not the Government could not do something for us in this present matter. Half a loaf is better than no bread. Even if the Government could make some concession it would be acceptable. The hon. Gentleman mentioned in his speech that £350,000 per year was budgetted for.

Yes, the Stamp Duty for the full year. I have not had the opportunity of seeing the Returns for last year. I have seen those for 1907–8, and the return from bond stamps, according to the Blue Book, was £417,000. The presumption is that a similar sum has possibly come to the Chancellor of the Exchequer during last year. But I have put £30,000 to £40,000 as the increment. A 5 per cent. increase would yield £450,000. The right hon. Gentleman the Chancellor of the Exchequer would then have £100,000 more than he budgetted for. Might I suggest that out of that money, as he has exempted Colonial Government securities and Colonial Provincial Government securities, that he should go one step further and exempt Colonial municipal securities? It is a small concession, from the point of view of finance, but it is a great concession to our Colonies. Our Colonies will appreciate it. By doing this I feel that the Government are not giving away any of their Free Trade policy. It would be an act of justice, not only to the business men of this country, who desire to grant their money to Canada, but it would also be doing an act of justice to the Colonies themselves.

In answer to the appeal of the hon. Gentleman, may I venture to remind the Committee of a fact—which I believe the hon. Gentleman knows very well indeed—and that is that in this competition to obtain loans or issues from Canada or elsewhere, the main competitors are not Germany, Prance, or America. It is very largely a case of competition of the gentlemen engaged, like himself, in this particular class of business, and thus the profits of this kind of transaction are kept, as the hon. Gentleman has said, to a low point. Any concession which the Chancellor of the Exchequer made would not necessarily be to Colonial municipalities,

Division No. 713.]

AYES.

[6.55 p.m.

Abraham, W. (Cork, N. E.)Cornwall, Sir Edwin A.Haworth, Arthur A.
Adkins, W. Ryland D.Cory, Sir Clifford JohnHazleton, Richard
Agnew, George WilliamCowan, W. H.Healy, Maurice (Cork)
Alden, PercyCox, HaroldHealy, Timothy Michael
Allen, A. Acland (Christchurch)Craig, Herbert J. (Tynemouth)Hedges, A. Paget
Allen, Charles P. (Stroud)Crosfield, A. H.Helme, Norval Watson
Ambrose, RobertCross, AlexanderHenderson, Arthur (Durham)
Ashton, Thomas GairCullinan, J.Henderson, J. McD. (Aberdeen, W.)
Asquith, Rt. Hon. Herbert HenryDavies, Ellis William (Eifion)Henry, Charles S.
Balfour, Robert (Lanark)Davies, Timothy (Fulham)Herbert, Col. Sir Ivor (Mon. S.)
Baring, Godfrey (Isle of Wight)Dewar, Sir J. A. (Inverness-sh.)Hobhouse, Rt. Hon. Charles E. H.
Barker, Sir JohnDobson, Thomas W.Holland, Sir William Henry
Barlow, Sir John E. (Somerset)Duffy, William J.Hooper, A. G.
Barnard, E. B.Duncan, C. (Barrow-in-Furness)Horniman, Emslie John
Barnes, G. N.Duncan, J. Hastings (York, Otley)Howard, Hon. Geoffrey
Barran, Sir John NicholsonDunne, Major E. Martin (Walsall)Isaacs, Rufus Daniel
Benn, W. (Tower Hamlets, St. Geo.)Edwards, Sir Francis (Radnor)Jackson, R. S.
Bennett, E. N.Erskine, David C.Jenkins, J.
Berridge, T. H. D.Essex, R. W.Jones, Sir D. Brynmor (Swansea)
Bethell, Sir J. H. (Essex, Romford)Evans, Sir S. T.Jones, Leif (Appleby)
Boland, JohnEverett, R. LaceyJones, William (Carnarvonshire)
Boulton, A. C. F.Falconer, J.Joyce, Michael
Brigg, JohnFindlay, AlexanderKekewich, Sir George
Bright, J. A.Fuller, John Michael F.Kelley, George D.
Burns, Rt. Hon. JohnFullerton, HughKilbride, Denis
Burt, Rt. Hon. ThomasGibb, James (Harrow)King, Alfred John (Knutsford)
Buxton, Rt. Hon. Sydney CharlesGill, A. H.Laidlaw, Robert
Carr-Gomm, H. W.Glendinning, R. G.Lamb, Edmund G. (Leominster)
Causton, Rt. Hon. Richard KnightGlover, ThomasLamb, Ernest H. (Rochester)
Chance, Frederick WilliamGrey, Rt. Hon. Sir EdwardLamont, Norman
Channing, Sir Francis AllstonGuest, Hon. Ivor ChurchillLayland-Barratt, Sir Francis
Clough, WilliamGulland, John W.Lehmann, R. C.
Cobbold, Felix ThornleyGwynn, Stephen LuciusLever, A. Levy (Essex, Harwich)
Collins, Stephen (Lambeth)Harcourt, Rt. Hon. L. (Rossendale)Levy, Sir Maurice
Collins, Sir Wm. J. (St. Pancras, W.)Harcourt, Robert V. (Montrose)Lewis, John Herbert
Condon, Thomas JosephHarmsworth, Cecil B. (Worcester)Lloyd-George, Rt. Hon. David
Corbett, A. Cameron (Glasgow)Harmsworth, R. L. (Caithness-shire)Lough, Rt. Hon. Thomas
Corbett, C. H. (Sussex, E. Grinstead)Harwood, GeorgeLynch, A. (Clare, W.)

but really to the gentlemen who are engaged in this kind of business in this or any other country and the Colonies.

The point I raised in my remarks on the discussion of the Amendment was that we in England, the groups in England, lost this business because it was taken from us by America; not that another firm competing with me or my firm took the business. The whole point of the remarks I made, or the point I wanted to make was, that Canada does not come over here with her bonds. Canada publishes a notice in the papers in Canada, in Montreal and Quebec, not in this country, that she wants money, and that on a certain day tenders for £300,000, £400,000, or half a million will be opened. The argument I wanted to bring forward was that America gets these bonds from us. Let us have the bonds here. We can compete amongst ourselves. What we want to do is to prevent America taking the bonds from the English market.

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

The Committee divided: Ayes, 216; Noes, 84.

Macdonald, J. M. (Falkirk Burghs)Pearce, Robert (Staffs, Leek)Stewart, Halley (Greenock)
Mackarness, Frederic C.Philipps, Col. Ivor (Southampton)Stewart-Smith, D. (Kendal)
Maclean, DonaldPickersgill, Edward HareStrachey, Sir Edward
Macpherson, J. T.Pirie, Duncan V.Straus, B. S. (Mile End)
MacVeagh, Jeremiah (Down, S.)Pointer, J.Summerbell, T.
MacVeigh, Charles (Donegal, E.)Ponsonby, Arthur A. W. H.Taylor, John W. (Durham)
M'Callum, John M.Raphael, Herbert H.Thomas, Sir A. (Glamorgan, E.)
M'Kean, JohnRea, Rt. Hon. Russell (Gloucester)Thorne, G. R. (Wolverhampton)
McKenna, Rt. Hon. ReginaldRoddy, M.Thorne, William (West Ham)
M'Laren, H. D. (Stafford, W.)Rees, J. D.Tillett, Louis John
Mallett, Charles E.Richards, T. F. (Wolverhampton, W.)Tomkinson, James
Markham, Arthur BasilRidsdale, E. A.Toulmin, George
Marnham, F. J.Roberts, Charles H. (Lincoln)Trevelyan, Charles Philips
Massie, J.Robertson, Sir G. Scott (Bradford)Walker, H. De R. (Leicester)
Masterman, C. F. G.Robertson, J. M. (Tyneside)Walsh, Stephen
Menzies, Sir WalterRobinson, S.Wardle, George J.
Middlebrook, WilliamRobson, Sir William SnowdonWarner, Thomas Courtenay T.
Molteno, Percy AlportRoch, Walter F. (Pembroke)Wason, Rt. Hon. E. (Clackmannan)
Montagu, Hon. E. S.Roe, Sir ThomasWason, John Cathcart (Orkney)
Muldoon, JohnRose, Sir Charles DayWatt, Henry A.
Murphy, John (Kerry, E.)Russell, Rt. Hon. T. W.White, Sir George (Norfolk)
Myer, HoratioRutherford, V. H. (Brentford)White, J. Dundas (Dumbartonshire)
Nannetti, Joseph P.Samuel, Rt. Hon. H. L. (Cleveland)White, Sir Luke (York, E. R.)
Newnes, F. (Notts, Bassetlaw)Samuel, S. M. (Whitechapel)Whittaker, Rt. Hon. Sir Thomas P.
Nolan, JosephScarisbrick, Sir T. T. L.Williams, J. (Glamorgan)
Nussey, Sir WillansSchwann, Sir C. E. (Manchester)Williams, W. Llewelyn (Carmarthen)
Nuttall, HarrySeely, ColonelWilliamson, Sir A.
O'Brien, Patrick (Kilkenny)Shaw, Sir Charles E. (Stafford)Wilson, P. W. (St. Pancras, S.)
O'Connor, John (Kildare, N.)Sheehy, DavidWilson, W. T. (Westhoughton)
O'Connor, T. P. (Liverpool)Sherwell, Arthur JamesWood, T. M'Kinnon
O'Donnell, C. J. (Walworth)Shipman, Dr. John G.Yoxall, Sir James Henry
O'Malley, WilliamSnowden, P.
O'Shaughnessy, P. J.Soares, Ernest J.TELLERS FOR THE AYES.—Mr. Joseph Pease and Captain Norton.
Parker, James (Halifax)Stanley, Hon. A. Lyulph (Cheshire)
Partington, OswaldSteadman, W. C.

NOES.

Acland-Hood, Rt. Hon. Sir Alex, F.Fletcher, J. S.Pease, Herbert Pike (Darlington)
Anson, Sir William ReynellForster, Henry WilliamPowell, Sir Francis Sharp
Balcarres, LordFoster, P. S.Ratcliff, Major R. F.
Banbury, Sir Frederick GeorgeGardner, ErnestRemnant, James Farquharson
Banner, John S. Harmood-Goulding, Edward AlfredRenton, Leslie
Baring, Capt. Hon. G. (Winchester)Guinness, Hon. R. (Haggerston)Renwick, George
Beckett, Hon. GervaseHaddock, George B.Roberts, S. (Sheffield, Ecclesall)
Bottomley, HoratioHamilton, Marquess ofRonaldshay, Earl of
Bowles, G. StewartHarris, Frederick LevertonRutherford, John (Lancashire)
Brotherton, Edward AllenHarrison-Broadley, H. B.Rutherford, Watson (Liverpool)
Burdett-Coutts, W.Hill, Sir ClementSalter, Arthur Clavell
Butcher, Samuel HenryHills, J. W.Smith, Abel H. (Hertford, E.)
Campbell, Rt. Hon. J. H. M.Hope, James Fitzalan (Sheffield)Starkey, John R.
Carlile, E. HildredHunt, RowlandStaveley-Hill, Henry (Staffordshire)
Castlereagh, ViscountJoynson-Hicks, WilliamStone, Sir Benjamin
Cecil, Evelyn (Aston Manor)Kimber, Sir HenryTalbot, Rt. Hon. J. G. (Oxford Univ.)
Cecil, Lord R. (Marylebone, E.)King, Sir Henry Seymour (Hull)Thomson, W. Mitchell- (Lanark)
Clive, Percy ArcherLambton, Hon. Frederick WilliamTuke, Sir John Batty
Clyde, J. AvonLockwood, Rt. Hon. Lt.-Col. A. R.Valentia, Viscount
Cochrane, Hon. Thomas H. A. E.Long, Col. Charles W. (Evesham)Walker, Col. W. H. (Lancashire)
Corbett, T. L. (Down, North)Long, Rt. Hon. Walter (Dublin, S.)Warde, Col. C. E. (Kent, Mid)
Courthope, G. LoydMacCaw, Wm. J. MacGeaghWilloughby de Eresby, Lord
Craig, Captain James (Down, E.)M'Arthur, CharlesWinterton, Earl
Craik, Sir HenryMason, James F. (Windsor)Wortley, Rt. Hon. C. B. Stuart-
Dickson, Rt. Hon. C. ScottMildmay, Francis BinghamYounger, George
Douglas, Rt. Hon. A. Akers-Morpeth, Viscount
Faber, George Denison (York)Morrison-Bell, CaptainTELLERS FOR THE NOES.—Major
Faber, Captain W. V. (Hants, W.)Newdegate, F. A.Coates and Sir W. Bull.
Fell, ArthurNicholson, William G. (Petersfield)

Clause 57—(Alteration And Extension Of Duty On Contract Notes)

(1) There shall be charged on every contract note as defined by this Section for or relating to the sale or purchase of any stock or marketable security the following Stamp Duties:—

Where the value of the stock or marketable security—

  • is £5 and does not exceed £100, 6d.;
  • exceeds £100 and does not exceed £500, 1s.;
  • exceeds £500 and does not exceed £1,000, 2s.;
  • and for each additional £1,000 or fraction of £1,000, 2s.

(2) Where a contract note is a continuation or carrying over note made for the purpose of continuing or carrying over any transaction for the sale or purchase of stock or marketable securities, the contract note, although it is made in respect of both a sale and purchase, shall be charged with duty under this section as if it related to one of those transactions only, and, if different rates of duty are chargeable in respect of those transactions, to that one of those transactions which would render the contract note chargeable at the highest rate.

(3) For the purposes of this Part of this Act, the expression "contract note" means the note sent by a broker or agent to his principal, or by any person who by way of business deals, or holds himself out as dealing, as a principal in any stock or marketable securities, advising the principal, or the vendor or purchaser, as the case may be, of the sale or purchase of any stock or marketable security, but does not include a note sent by a broker or agent to his principal where the principal is himself acting as broker or agent for a principal, and is himself either a member of a stock exchange in the United Kingdom, or a person who, in the opinion of the Commissioners bonâ fide carries on the business of a stockbroker in the United Kingdom, and is registered as such in the list of stockbrokers kept by the Commissioners.

(4) Where a contract note advises the sale or purchase of more than one description of stock or marketable security, the note shall be deemed to be as many contract notes as there are descriptions of stocks or securities sold or purchased.

moved in Subsection (1) to leave out "£500" ["where the value of the stock or marketable security is £5 and does not exceed £100—sixpence; exceeds £100 and does not exceed £500—one shilling"], and to insert instead thereof "£1,000."

That, of course, would be followed by consequential Amendments for sums between £1,000 and £10,000 and so on. I know the Chancellor of the Exchequer has put down upon the Paper Amendments which very much modify the objections raised to the original Clause, and I think it would save time if in discussing this Amendment I was at the same time to discuss the Amendments of the Chancellor of the Exchequer. The Clause, as it originally stood, provided that on a contango transaction of £100,000 the amount that would have to be paid in Stamp Duty would be £120. At the present moment the amount which would have to be paid is £1 4s., and the enormous difference between that sum and the original sum of £120, and even the sum which is now provided, namely, £12 on such a transaction, shows I think the tax has not really been considered very carefully. The duties, even as they are amended, will press very heavily upon certain transactions. There is a very large business done in the way of borrowing money on the security of Consols. The facilities with which people have been able to borrow money on Consols encourages them to invest in Consols, because they have the knowledge that when they invest in Consols they will be able without difficulty to obtain loans upon them, and consequently it becomes a very good security. Under the Chancellor's new proposals, a transaction of £20,000 on Consols carries a Stamp Duty of £1. The profit is very often only one-eighth which amounts only to £2, yet the Chancellor of the Exchequer is going to take £1, which amounts to 50 per cent. of the profits. Although £1 does not seem a large amount, the fact that it is half the profit shows it is a tax that ought not to be imposed. I have gone very carefully into these figures, and in order not to err on the side of exaggeration I have asked several people in business whether I should be wrong in stating that the ordinary profit on a contango is not more than I have stated. They said you would be very much understating it. The result is that the Chancellor of the Exchequer is taking this large tax from the State. What would be the result of all this? The result would be that contangos will be abolished and the money will be locked up. Such a large amount of taxation as that cannot be taken when the profits are so small. The Chancellor takes 50 per cent. of your profit, and the result will be that it will be done in other forms, and the Chancellor will lose his money. That is the result of making these taxes so heavy. In the case of an ordinary transaction the tax of £1 on investment of £20,000 is not a very large amount. That is not a question of the Stock Exchange, because it is a tax which will really be borne by the public. No doubt they will grumble if they have to pay £1 for the investment of £20,000. I do not think that that would have any deterrent effect, because a man invests £20,000 at rare intervals. But this tax will have an effect upon the business of large financial houses, where business is constantly going on and where stock is constantly changing hands. As hon. Members know, it is not investments pure and simple that make the market, but it is where the large financial houses are prepared to come forward to do the business. In that case I believe the Clause will have a very bad effect. The margin is so very small in this kind of business. I am afraid the effect will be to drive away business which we already have in London. A shilling, I am told, would bring in £175,000 this year, and £350,000 next year. If the duty of 1s. brings in £175,000, and if that duty is increased its yield would be very much more. Two shillings would bring in £350,000. We were told in the last Debate by the Financial Secretary to the Treasury that we did not offer any alternative. Well, but if he makes the duty 2s. in every contract over £1,000, he will get more than £350,000. If the right hon. Gentleman accepts this Amendment he would relieve a considerable amount of anxiety in the City, while at the same time he would secure his money, and if he did not find next year that the result of the duty was as good as he expected then he will be able to increase it. It is much better to go slowly in these matters rather than to go hastily. I am afraid, however, I am appealing to deaf ears, as I do not believe the Chancellor will accept my Amendment.

Not only will I not accept the hon. Baronet's Amendment, but I hope he does not expect me to accept it. As I understand it, we are now discussing the scale. That scale, which I placed upon the Notice Paper, represents the arrangement arrived at between the Government and the Stock Exchange after very careful investigation of all the cases submitted to us. I agree it is a very different estimate from that originally submitted. We examined something like 700 cases, and, after negotiations conducted over a period of several months, we arrived at this arrangement by agreement. The representatives of the Stock Exchange, men who have the confidence of the Stock Exchange, having assented to this, I do not think the hon. Baronet will contend that it is a scale which will destroy their business.

Oh, no, I did not say that. I said seriously interfere with their business.

Or that it will seriously interfere with their business. They are quite satisfied with the scale. Of course, there may be special cases, but they are a very narrow margin, that possibly may be interfered with to a certain extent, but they are very exceptional cases, and the Stock Exchange gentlemen, I am bound to say, met the Government in a spirit which I desire to fully recognise. They have been exceedingly fair and straighforward, and I think they have taken a highly patriotic course. From the start they said: "We fully realise that the Government is in need of money for national purposes, and we think it is fair in these circumstances that you should come to the Stock Exchange for its share, and we are quite prepared to pay our share." All they said was: "We think you ought to raise the money in a better way." I said: "Very well; give me the same amount of money in a better way and I shall be very glad." After months of negotiation this scale has been arrived at, as an agreement between the Stock Exchange and the Government, and I do not think that much criticism can be offered if they are satisfied. I think they met me very well. These gentlemen can take very good care of themselves, and the hon. Baronet the Member for the City of London is a very fair sample of them. The members of the Stock Exchange Committee regard the Amendment I shall propose later as a fair scale, and there is no injustice done. I hope, therefore, that the hon. Baronet will withdraw his Amendment and enable us to go on with the next Amendment.

After the explanation of the Chancellor of the Exchequer in regard to his negotiations with those representing the Stock Exchange I would ask the hon. Baronet to withdraw his Amendment. I feel we do not want to prolong this discussion, and I think we ought to devote our time to discussing points which have not been acceded to by the Stock Exchange Committee. If I may pass any criticism upon the arrangement come to between the Government and the Stock Exchange Committee it would be that I think the small investor might have had a smaller charge and a larger one might have been put upon the rich investor.

I have received a letter from the Stock Exchange Committee, and I do not gather from it that they are satisfied with the proposals of the Chancellor of the Exchequer. The right hon. Gentleman says an arrangement has been come to, and I am not surprised that the Chancellor of the Exchequer has got the better of the Stock Exchange. Under these circumstances there is nothing further to be said. If the Members of the Committee had consulted me I should have told them to be very careful as in all probability they would be "bested," and it seems they have been bested. I ask leave to withdraw my Amendment.

Amendment, by leave, withdrawn.

moved, to leave out the last two lines of Sub-section (1) ["and for each additional £1,000 or fraction of £1,000…two shillings"], and to insert instead thereof the following scale:—

"Exceeds£1,000and does not exceed£1,5003s.
Exceeds1,500and does not exceed2,5004s.
Exceeds2,500and does not exceed5,0006s.
Exceeds5,000and does not exceed7,5008s.
Exceeds7,500and does not exceed10,00010s.
Exceeds10,000and does not exceed12,50012s.
Exceeds12,500and does not exceed15,00014s.
Exceeds15,000and does not exceed17,50016s.
Exceeds17,500and does not exceed20,00018s.
Exceeds20,000and does not exceed£1"

Amendment agreed to.

moved, in Sub-section (3), to leave out the words "in the opinion of the Commissioners."

Amendment agreed to.

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

I desire to ask the attention of the Committee and the Chancellor of the Exchequer to the few observations I shall now submit with a view to endeavouring to satisfy the Committee that something better than the provisions of this Clause is available to the Government which will bring in more money than this Clause can bring in, and something which could not possibly inflict any serious or appreciable hardship upon any member of the community. This Clause has been glibly spoken about by hon. Gentlemen in all parts of the House as a contribution by the Stock Exchange towards the financial necessities of the State. To me that is an utterly meaningless phrase and mere clap-trap, which will not bear a moment's investigation. The Stock Exchange is not going to contribute a farthing. This proposal is only a direction to the Stock Exchange agents as to the amount of the burden they shall put upon the public and the ladies and gentlemen who will bear this burden are exactly the same people upon whom the incidence of the rest of this Budget will fall. There is no contribution whatever from the Stock Exchange, and this is simply a proposal to put an additional burden upon investors and speculators. I make myself responsible for the statement that 90 per cent. of the business of the Stock Exchange is of a gambling description. Quite 90 percent. of Stock Exchange transactions are made solely for the purpose of securing a profit upon a rise in price. The other 10 per cent. represent bonâ fide investments. If a man buys a house for investment or if he buys for speculation, he will have to pay to the State exactly the same contribution. Consequently, the speculator in freehold house property is exactly on the same level as an investor in house property, so far as his contribution to the revenue is concerned. When, however, you come to the Stock Exchange, there is this extraordinary distinction: Assume that two men buy the same kind of shares at the same time and at the same price; assume that one buys simply as a gamble and the other as a bonâ fide investor. The investor takes up his stocks and pays his 10s. per cent. for the transfer, but the gambler simply pays that puny thing known as the contract stamp. The result is that the investor makes the Government a present of 10s. per cent. on the transaction and the gambler goes practically scot free. The 10s. per cent. is, for all practical purposes, just over 1d. in the £. Now, is there any human being inspired with a desire to speculate in stocks and shares who would refrain from doing so because he had to pay for a £1 share £1 0s. 1d.? Such an argument will not bear consideration for a moment.

In the suggestion I make there will be no danger of the business being driven away. I can quote as a precedent for my suggestion the principal Act, the Stamp Act of 1891. In that Act it is provided that in regard to a certain class of property the duty shall be paid upon the contract to purchase. All I ask the Chancellor of the Exchequer to do is to provide that these Transfer Duties which are to be paid when stock is transferred shall not be increased and shall not be altered, but that the duty shall be payable on the contract to purchase, so that the moment the gambler buys the stock he will have to pay the transfer. What is the objection to that proposal? I have argued it with members of the Stock Exchange, and I can find no answer to it. I argued it with the Chancellor of the Exchequer, and he said, "It is not the man who sells the stock, it is the bearer we want to get at, and your proposal would not touch him." Every transaction in stocks and shares is assumed in law to be a genuine purchase or sale. When a man goes to a stockbroker and says, "Buy me 1,000 shares," the law assumes he means to pay for those shares and take them up, and unless he does so the bargain would be void, and could not be enforced. I am not suggesting to the Chancellor of the Exchequer any alteration in the law. When a man buys stocks and shares we assume that he buys them as a bonâ fide transaction. My suggestion is that instead of paying the Transfer Duty later on you should collect it at the source, and then it is put on your contract. That would bring into the Exchequer many million pounds a year. I do not think there is a member of the Stock Exchange who will deny that statement.

In the ordinary business of the Stock Exchange the enormously preponderating portion of it is the purchase of stocks and shares which never culminate in a transfer. They are simply gambling transactions Let me give one concrete instance. Two friends of mine each bought on the same day 500 shares for £6,000 from the same broker, an eminent member of the Stock Exchange, and they each got a contract. One of them paid the £6,000 plus the contract stamp, and the other simply said to the broker, "I am not going to take the shares up now; carry them over for me." The one who took them up had to pay the Government £30, whilst the other does not pay the Government a farthing. I put that case to the Government. That means in other words, that he paid interest on the money he borrowed. The man who paid the £6,000 lost the interest on it. There is no answer to this proposal. The tax is easily collected, and it would not interfere with business at all. Every stockbroker would welcome it, because it would give him a little additional security that the transaction was a bonâ fide one. It means 1d. in the £ on the purchase of stock. It would drive no business abroad. It would only apply to registered stock and not to bearer stock. It would not affect foreign securities to any appreciable extent at all. It would bring in many millions a year, and I do ask the Chancellor of the Exchequer to give it his serious consideration. It would mean at least as much as a 10 per cent. duty on manufactured goods coming into this country. No one will deny that our present fiscal policy has been somewhat strained and sorely tried for national revenue. Here is £10,000,000 at least waiting for the Chancellor of the Exchequer, as any examination of the books of the Stock Exchange will show. It is not only the Stock Exchange of London, but all the stock exchanges of England, and outside stockbrokers. You give away the case now by means of the additional stamp on continuation contracts and on options, and you propose to make the outside broker put stamps on his contract, things you have never done before. Why not go a little further. Ten millions is not too much for the Chancellor of the Exchequer. The Development Fund can do with it very well, if he can find no other use for it. There is the whole case, and there is no answer to it. I shall listen with anxiety why it is the Chancellor of the Exchequer will not adopt it. I have come to the conclusion that a financial Resolution would not be necessary, but if it were necessary the Chancellor of the Exchequer could get it to-morrow or Monday, and he could then get £10,000,000 move than he has asked for. I hope, instead of brushing the proposal aside with platitudes, he will, now he is in a melting mood, give it serious consideration. I put it forward as a serious contribution to the Debate.

My hon. Friend has placed before me a golden prospect, and I wish it were possible to see its development. He says that by treating the original transaction as if it were the transfer of the share you would get £10,000,000. Has it never occurred to him that you might destroy the business altogether? Everyone knows that the difficulty with a tax of this kind is to strike the mean between that minimum which gives you an inadequate amount and that maximum which absolutely destroys the tax. It is a very difficult thing to know at what point the tax you impose ceases to be of a productive character, and I am certain that if every speculator had to pay this Stamp Duty as if it were on a real transfer business would be driven away altogether.

Does not the law at the present time assume it to be a real transaction? It would only affect the gambling members of the public. They would pay 1d. in the £ more for gambling in stock.

If the object of the hon. Member were to stop these transactions his proposal would be a very effective means, but it certainly would not produce revenue. If the House of Commons were to come to the conclusion that these transactions had to be stamped out altogether, a 10s. per cent. duty would be a very effective way of attaining that object, but I am perfectly certain no revenue would be produced by that means. As a matter of fact, in France there is an ad valorem duty, but it does not approximate the amount suggested, and though I will not say it has altogether destroyed the business, it has limited it very considerably. The same thing applies to the German stamps. Therefore, however alluring the scheme may be from the point of view of a Chancellor of the Exchequer who is sadly in need of cash, I am afraid I could not possibly be tempted, and certainly not now, to substitute this proposal for the proposal in the Bill.

I think the hon. Member for Hackney (Mr. Bottomley) has made a statement which requires an answer. I do not think any transaction which takes place on the Stock Exchange is a gambling transaction. The hon. Member imagines that the sum of £10,000,000 may be produced for the Chancellor of the Exchequer out of the pockets of the Stock Exchange or out of the public by placing a duty of 10s. per cent. on all bargains entered into in registered stocks or shares, but not in bearer shares. If the hon. Member had been logical in his suggestion, and had included the whole, then I was going to show what a serious impost this would be and how it would kill business; but his suggestion is that the tax should be merely applied to registered securities. What would be the result? Every bargain which he described as gambling in registered stocks would simply take place in bearer securities. The whole proposal is absolutely ridiculous.

Does the hon. Member suggest that a gambler in English companies would deal in bearer stocks? Does he not know that almost without exception they are registered?

The hon. Member who has just sat down has overlooked the fact that on the bearer certificates he would have to pay treble duty. What is the amount of revenue which the Chancellor of the Exchequer is giving away compared with his original proposal?

I do not understand what the hon. Gentleman means by the original proposal. The Chancellor of the Exchequer under the altered scale is giving away no revenue at all. It is a mere redistribution of the sum which it was always intended to obtain.

It is certainly a decrease on the original proposal of the Bill. The Chancellor of the Exchequer is entitled to his full pound of flesh on all these gambling transactions. I do not pose as being virtuous myself. I gamble, and, like most other fools who engage in the same occupation, I always lose. You have here a business which the hon. Member for Hackney (Mr. Bottomley) truly says is chiefly gambling, and a Government which stands for purity cannot even see its way to tax gamblers the same amount as bonâ fide investors have to pay. I cannot for the life of me see why the full duty should not be paid on all these gambling transactions. I am opposed to all gambling. It is one of the greatest curses in the world. But here is a Government which claims to be so virtuous, and it will not put a tax on gamblers. It gives them a free licence and every facility to gamble at a very minimum of cost. The Chancellor of the Exchequer has said the Stock Exchange met him as patriots. He did not say that about them in this House a few years ago. I am glad to think he has changed his views. He says the Stock Exchange is providing the money. I agree, however, with the hon. Member for Hackney that they do not provide it; their clients provide it; and I am quite certain that to say the Stock Exchange is to provide this money and that the Chancellor of the Exchequer has entered into an agreement with them is not in accordance with the wishes of the great bulk of progressive opinion in this country.

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

The Committee divided: Ayes, 207; Noes, 67.

Division No. 714.]

AYES.

[7.45 p.m.

Abraham, W. (Cork, N. E.)Harcourt, Robert V. (Montrose)O'Connor, T. P. (Liverpool)
Adkins, W. Ryland D.Harmsworth, Cecil B. (Worcester)O'Donnell, C. J. (Walworth)
Agnew, George WilliamHarmsworth, R. L. (Caithness-shire)O'Kelly, Conor (Mayo, N.)
Alden, PercyHarwood, GeorgeO'Malley, William
Allen, A. Acland (Christchurch)Haworth, Arthur A.O'Shaughnessy, P. J.
Allen, Charles P. (Stroud)Hazleton, RichardParker, James (Halifax)
Ambrose, RobertHealy, Maurice (Cork)Partington, Oswald
Ashton, Thomas GairHealy, Timothy MichaelPearce, Robert (Staffs, Leek)
Balfour, Robert (Lanark)Hedges, A. PagetPhilipps, Col. Ivor (Southampton)
Baring, Godfrey (Isle of Wight)Helme, Norval WatsonPickersgill, Edward Hare
Barlow, Sir John E. (Somerset)Henderson, Arthur (Durham)Pirie, Duncan V.
Barnard, E. B.Henderson, J. McD. (Aberdeen, W.)Pointer, J.
Barnes, C. N.Henry, Charles S.Ponsonby, Arthur A. W. H.
Barran, Sir John NicholsonHerbert, T. Arnold (Wycombe)Priestley, Arthur (Grantham)
Barry, Redmond J. (Tyrone, N.)Hobhouse, Rt. Hon. Charles E. H.Raphael, Herbert H.
Bell, RichardHooper, A. G.Rea, Rt. Hon. Russell (Gloucester)
Benn, W. (Tower Hamlets, St. Geo.)Horniman, Emslie JohnReddy, M.
Berridge, T. H. D.Howard, Hon. GeoffreyRichards, T. F. (Wolverhampton, W.)
Bethell, Sir J. H. (Essex, Romford)Isaacs, Rufus DanielRidsdale, E. A.
Bottomley, HoratioJackson, R. S.Roberts, Charles H. (Lincoln)
Boulton, A. C. F.Jenkins, J.Robertson, Sir G. Scott (Bradford)
Brigg, JohnJones, Sir D. Brynmor (Swansea)Robertson, J. M. (Tyneside)
Bright, J. A.Jones, Leif (Appleby)Robinson, S.
Burns, Rt. Hon. JohnJones, William (Carnarvonshire)Robson, Sir William Snowdon
Buxton, Rt. Hon. Sydney CharlesJoyce, MichaelRoch, Walter F. (Pembroke)
Carr-Gomm, H. W.Keating, M.Rogers, F. E. Newman
Causton, Rt. Hon. Richard KnightKelley, George D.Rose, Sir Charles Day
Chance, Frederick W.Kilbride, DenisRussell, Rt. Hon. T. W.
Channing, Sir Francis AllstonKing, Alfred John (Knutsford)Samuel, Rt. Hon. H. L. (Cleveland)
Churchill, Rt. Hon. Winston S.Laidlaw, RobertSamuel, S. M. (Whitechapel)
Clough, WilliamLamb, Edmund G. (Leominster)Schwann, Sir C. E. (Manchester)
Collins, Stephen (Lambeth)Lamb, Ernest H. (Rochester)Seely, Colonel
Condon, Thomas JosephLamont, NormanShaw, Sir Charles E. (Stafford)
Corbett, A. Cameron (Glasgow)Layland-Barratt, Sir FrancisSheehy, David
Corbett, C. H. (Sussex, E. Grinstead)Lehmann, R. C.Shipman, Dr. John G.
Cornwall, Sir Edwin A.Lever, A. Levy (Essex, Harwich)Snowden, P.
Cory, Sir Clifford JohnLevy, Sir MauriceSoares, Ernest J.
Cox, HaroldLewis, John HerbertSteadman, W. C.
Crosfield, A. H.Lloyd-George, Rt. Hon. DavidStewart, Halley (Greenock)
Cullinan, J.Lundon, T.Stewart-Smith, D. (Kendal)
Dalziel, Sir James HenryLynch, A. (Clare, W.)Straus, B. S. (Mile End)
Davies, Ellis William (Eifion)Macdonald, J. M. (Falkirk Burghs)Summerbell, T.
Davies, Timothy (Fulham)Mackarness, Frederic C.Taylor, John W. (Durham)
Davies, Sir W. Howell (Bristol, S.)Maclean, DonaldThomas, Sir A. (Glamorgan, E.)
Dewar, Sir J. A. (Inverness-shire)MacNeill, John Gordon SwiftThorne, G. R. (Wolverhampton)
Dobson, Thomas W.MacVeagh, Jeremiah (Down, S.)Thorne, William (West Ham)
Duffy, William J.MacVeigh, Charles (Donegal, E.)Tomkinson, James
Duncan, C. (Barrow-in-Furness)M'Callum, John M.Trevelyan, Charles Philips
Duncan, J. Hastings (York, Otley)McKenna, Rt. Hon. ReginaldVerney, F. W.
Dunn, A. Edward (Camborne)M'Laren, H. D. (Stafford, W.)Walker, H. De R. (Leicester)
Edwards, Sir Francis (Radnor)M'Micking, Major G.Walsh, Stephen
Elibank, Master ofMallet, Charles E.Walters, John Tudor
Erskine, David C.Marnham, F. J.Waring, Walter
Essex, R. W.Massie, J.Wason, Rt. Hon. E. (Clackmannan)
Evans, Sir S. T.Meagher, MichaelWason, John Cathcart (Orkney)
Everett, R. LaceyMenzies, Sir WalterWatt, Henry A.
Falconer, J.Middlebrook, WilliamWhite, Sir George (Norfolk)
Findlay, AlexanderMolteno, Percy AlportWhite, J. Dundas (Dumbartonshire)
Fuller, John Michael F.Montagu, Hon. E. S.White, Sir Luke (York, E. R.)
Fullerton, HughMuldoon, JohnWhittaker, Rt. Hon. Sir Thomas P.
Gibb, James (Harrow)Myer, HoratioWilliams, J. (Glamorgan)
Gibson, J. P.Nannetti, Joseph P.Williams, W. Llewelyn (Carmarthen)
Gill, A. H.Newnes, F. (Notts, Bassetlaw)Williamson, Sir A.
Glendinning, R. G.Nolan, JosephWilson, Hon. G. G. (Hull, W.)
Glover, ThomasNorman, Sir HenryWilson, W. T. (Westhoughton)
Grey, Rt. Hon. Sir EdwardNorton, Captain Cecil WilliamWood, T. M'Kinnon
Gulland, John W.Nussey, Sir WillansYoxall, Sir James Henry
Gwynn, Stephen LuciusNuttall, Harry
Haldane, Rt. Hon. Richard B.O'Brien, Patrick (Kilkenny)TELLERS FOR THE AYES.—Mr. Joseph Pease and Sir E. Strachey.
Harcourt, Rt. Hon. L. (Rossendale)O'Connor, John (Kildare, N.)

NOES.

Acland-Hood, Rt. Hon. Sir Alex. F.Butcher, Samuel HenryCorbett, T. L. (Down, North)
Anson, Sir William ReynellCampbell, Rt. Hon. J. H. M.Courthope, G. Loyd
Balcarres, LordCarlile, E. HildredCraig, Captain James (Down, E.)
Banner, John S. Harmood-Castlereagh, ViscountCraik, Sir Henry
Baring, Capt. Hon. G. (Winchester)Cecil, Evelyn (Aston Manor)Douglas, Rt. Hon. A. Akers-
Brotherton, Edward AllenCecil, Lord R. (Marylebone, E.)Duncan, Robert (Lanark, Govan)
Burdett-Coutts, W.Clive, Percy ArcherFaber, George Denison (York)

Fell, ArthurMacCaw, Wm. J. MacGeaghSmith, Abel H. (Hertford, E.)
Fletcher, J. S.Markham, Arthur BasilStarkey, John R.
Forster, Henry WilliamMason, James F. (Windsor)Staveley-Hill, Henry (Staffordshire)
Foster, P. S.Mildmay, Francis BinghamStone, Sir Benjamin
Gardner, ErnestMorpeth, ViscountThomson, W. Mitchell- (Lanark)
Goulding, Edward AlfredMorrison-Bell, CaptainTuke, Sir John Batty
Gretton, JohnNicholson, Wm. G. (Petersfield)Valentia, Viscount
Haddock, George B.Pease, Herbert Pike (Darlington)Walker, Col. W. H. (Lancashire)
Hamilton, Marquess ofPowell, Sir Francis SharpWarde, Col. C. E. (Kent, Mid)
Harrison-Broadley, H. B.Rawlinson, John Frederick PeelWilliams, Col. R. (Dorset, W.)
Hermon-Hodge, Sir RobertRenton, LeslieWortley, Rt. Hon. C. B. Stuart-
Hills, J. W.Renwick, GeorgeYounger, George
Joynson-Hicks, WilliamRoberts, S. (Sheffield, Ecclesall)
Kimber, Sir HenryRonaldshay, Earl of
King, Sir Henry Seymour (Hull)Rutherford, John (Lancashire)TELLERS FOR THE NOES.—Sir
Lockwood, Rt. Hon. Lt.-Col. A. R.Rutherford, Watson (Liverpool)F. Banbury and Sir W. Bull.
Long, Col. Charles W. (Evesham)Salter, Arthur Clavell

Clause 58—(Obligation To Execute Contract Note)

(1) Any person who effects any sale or purchase of any stock or marketable security of the value of five pounds or upwards as a broker or agent, and any person who by way of business deals, or holds himself out as dealing, as a principal in any stock or marketable security, and buys or sells any such stock or marketable security of a value of five pounds or upwards, shall forthwith make and execute a contract note, and transmit the note to his principal, or to the vendor or purchaser of the stock or marketable security, as the case may be, and in default of so doing shall incur a fine of twenty pounds.

(2) If any person makes or executes any contract note chargeable with duty and not being duly stamped, he shall incur a fine of twenty pounds.

(3) No broker, agent, or other person shall have any legal claim to any charge for brokerage, commission, or agency, with reference to the sale or purchase of any stock or marketable security of the value of five pounds or upwards if he fails to comply with the provisions of this Section.

(4) All Stamp Duties on a contract note are to be denoted by an adhesive stamp appropriated to a contract note, and the stamp is to be effectively cancelled by the person by whom the note is executed by writing on or across the stamp his name or initials, or the name or initials of his firm, together with the true date of his so writing.

(5) Any Stamp Duty on a contract note may be added to the charge for brokerage or agency.

moved, in Sub-section (1), to omit the words "and any person who by way of business deals, or holds himself out as dealing as a principal in any stock or marketable security of a value of £5 or upwards." The effect of these words is to compel any principal who deals in any stock or marketable security to issue a contract note on each side of the transaction. Hitherto it has only been necessary to have one contract note, and the effect of these words must be to seriously restrict dealings in stocks. Take the case of the primary stock in this country, Consols. Any person who wishes to invest in Consols can send his broker into the market, and get business done on a very narrow margin. If the price is 83, he can sell at 83, and purchase at 83 1–16th, and the only charge is the broker's commission and the ordinary contract stamp. But by this Amendment the Government insist that the dealer on the Stock Exchange from whom the broker buys the stock shall himself deliver a contract note to the broker who deals with him. I should have thought that that was in conflict with the interests of business. If you are to compel the dealer in a security on which the profit is only 1s. 3d. to pay a 2s. stamp on the contract note on one side, and a 2s. stamp on a contract note on the other, you are taking away the whole of his profit. When he offers to buy at 83 on the one hand, and to sell at 83 1–16th on the other, his profit lies in the middle of these figures, and inasmuch as the profit is so small you are going by this Clause to make him pay away 4s. Can the Government suppose that under such conditions the market for Consols will remain in its present position? You will not be able to have dealings conducted on the same narrow margin as at present. I hope my right hon. Friend, after examination of this point, will see his way to abandon this proposal of the Government. I think it must have been put on the Paper without full consideration.

I think my hon. Friend is labouring under a mistake, for this Sub-section of Clause 58 re-enacts almost exactly Clause 53 of the principal Act. If the hon. Gentleman will look at that Act he will find that the only words introduced into this Clause which are not in the other Clause are these: "Any person who by way of business deals or holds himself out as dealing as a principal in any stock or marketable security," etc. These words are substituted for words in the original Act, "the broker or agent," and the purpose is to ensure that the bucket-shop keepers shall pay this Stamp Duty.

I have an Amendment down later on to insert words providing that this Section shall not apply in the case of transactions carried out in the course of their ordinary business relations between members of Stock Exchanges in the United Kingdom. May I ask if that is ruled out should the Amendment now before the Committee be carried?

As that Amendment of my hon. Friend carries out the object aimed at by the hon. Member for Brighton, may I suggest to the latter that he withdraw his Amendment?

Amendment, by leave, withdrawn.

moved, in Sub-section (1), to leave out the word "of" ["a fine of"], and to insert instead thereof the words "not exceeding twenty pounds."

I hope the right hon. Gentleman in charge of this Bill for the time being will accept this most reasonable Amendment, as has been done on other Clauses of the Finance Bill. This Clause provides that a person selling stock exceeding £5 in value shall forthwith execute a contract note, and that in default of so doing he shall incur a fine of £20. But it is not always possible to execute a contract note forthwith, and it may possibly be forgotten without any intention to defraud the revenue. It seems extraordinary that the penalty in every case should be £20, and that there should be no option whatever for the magistrate to take into account the circumstances. I do not think there ought to be such an arbitrary sum fixed. I trust the right hon. Gentleman will see the reasonableness of this Amendment, and agree to do what has been done under similar circumstances in other Clauses.

I can assure the right hon. Gentleman that this Amendment is really not necessary. Under the Customs and Inland Revenue Act, 1890, he will see the fines can be mitigated by the magistrates to any extent. In putting this fixed penalty as a maximum penalty, we are merely following the precedent of the principal Act, and I think it would be very undesirable to change the language of the penal provisions of that Act and to insert different words in the present Act. There really is no hardship. It has exactly the same effect.

8.0 P.M.

May I point out that this particular Clause does not refer to any other Act, and it distinctly says that in default of executing this contract note he shall incur a fine of £20. There is no option whatever, and I think no magistrate would read it in any other way than that he must in the case of every omission impose a fine of £20. I think the Amendment is most reasonable.

Question, "That the word 'of' stand part of the Clause," put, and agreed to.

moved, at the end of Sub-section (1), to insert the words "Provided that this Section shall not apply in the case of transactions carried out in the course of their ordinary business relations between members of stock exchanges in the United Kingdom."

I understand that the Government accept this Amendment.

Question, "That those words be there inserted," put, and agreed to.

moved, in Sub-section (2), to leave out the word "of" ["He shall incur a fine of £20,"], and to insert instead thereof the words "not exceeding."

This is another matter, and different from the previous Amendment I moved. This Sub-section provides that "if any person makes or executes any contract note chargeable with duty, and not being duly stamped, he shall incur a fine of £20." I do put it to the right hon. Gentleman in charge of the Bill that he should meet us in regard to this matter, because it does seem to me very hard that if a man forgets to put on a stamp he should be liable to a penalty. A man may easily forget, and the Clause does not say that to commit an offence he shall act "knowingly" or "wilfully." But it says in every case he shall pay a penalty of £20. I think it is reasonable that the Sub-section should be made to read "not exceeding £20."

I can assure the hon. Member that an alteration such as he proposes may very possibly lead to a misreading of the principal Act of 1891, and may lead to a misinterpretation to that Act. The evil which the hon. Member sees looming before him is really provided for by the Inland Revenue Act of 1891, and the whole grievance is there met. The insertion of these words which he proposes would really make it necessary to have them set right by some later revenue enactment.

I did not say anything on the former Amendment, because I anticipated the right hon. Gentleman would quote some authority, but he has

Division No. 715.]

AYES.

[8.7 p.m.

Abraham, W. (Cork, N. E.)Findlay, AlexanderM'Callum, John M.
Adkins, W. Ryland D.Fuller, John Michael F.McKenna, Rt. Hon. Reginald
Agnew, George WilliamGibb, James (Harrow)M'Laren, H. D. (Stafford, W.)
Alden, PercyGibson, J. P.Mallet, Charles E.
Allen, A. Acland (Christchurch)Gill, A. H.Markham, Arthur Basil
Allen, Charles P. (Stroud)Glover, ThomasMarnham, F. J.
Ambrose, RobertGrey, Rt. Hon. Sir EdwardMassie, J.
Ashton, Thomas GairGulland, John W.Masterman, C. F. G.
Asquith, Rt. Hon. Herbert HenryGwynn, Stephen LuciusMeagher, Michael
Balfour, Robert (Lanark)Harcourt, Rt. Hon. L. (Rossendale)Menzies, Sir Walter
Barlow, Sir John E. (Somerset)Harcourt, Robert V. (Montrose)Middlebrook, William
Barnard E. B.Harmsworth, Cecil B. (Worcester)Molteno, Percy Alport
Barnes, G. N.Harmsworth, R. L. (Caithness-shire)Montagu, Hon. E. S.
Barran, Sir John NicholsonHaworth, Arthur A.Myer, Horatio
Bell, RichardHedges, A. PagetNannetti, Joseph P.
Benn, W. (Tower Hamlets, St. Geo.)Helme, Norval WatsonNewnes, F. (Notts, Bassetlaw)
Berridge, T. H. D.Henderson, Arthur (Durham)Norman, Sir Henry
Bethell, Sir J. H. (Essex, Romford)Henderson, J. M. (Aberdeen, W.)Nussey, Sir Willans
Boulton, A. C. F.Henry, Charles S.Nuttall, Harry
Brigg, JohnHobhouse, Rt. Hon. Charles E. H.O'Brien, Patrick (Kilkenny)
Bright, J. A.Holt, Richard DurningO'Donnell, C. J. (Walworth)
Burns, Rt. Hon. JohnHooper, A. G.O'Malley, William
Burt, Rt. Hon. ThomasHorniman, Emslie JohnParker, James (Halifax)
Carr-Gomm, H. W.Howard, Hon. GeoffreyPartington, Oswald
Chance, Frederick WilliamIsaacs, Rufus DanielPearce, Robert (Staffs, Leek)
Clough, WilliamJackson, R. S.Philipps, Col. Ivor (Southampton)
Collins, Stephen (Lambeth)Jenkins, J.Pickersgill, Edward Hare
Corbett, A. Cameron (Glasgow)Jones, Leif (Appleby)Pirie, Duncan V.
Corbett, C. H. (Sussex, E. Grinstead)Jones, William (Carnarvonshire)Pointer, J.
Cornwall, Sir Edwin A.Joyce, MichaelPonsonby, Arthur A. W. H.
Cory, Sir Clifford JohnKelley, George D.Priestley, Arthur (Grantham)
Cox, HaroldKing, Alfred John (Knutsford)Raphael, Herbert H.
Cross, AlexanderLaidlaw, RobertRea, Rt. Hon. Russell (Gloucester)
Dalziel, Sir James HenryLamb, Edmund G. (Leominster)Reddy, M.
Davies, Ellis William (Eifion)Lamb, Ernest H. (Rochester)Rees, J. D.
Davies, Sir W. Howell (Bristol, S.)Lamont, NormanRichards, T. F. (Wolvarhampton, W.)
Dewar, Sir J. A. (Inverness-shire)Layland-Barratt, Sir FrancisRidsdale, E. A.
Dobson, Thomas W.Lehmann, R. C.Roberts, Charles H. (Lincoln)
Duffy, William J.Lever, A. Levy (Essex, Harwich)Robertson, Sir G. Scott (Bradford)
Duncan, C. (Barrow-in-Furness)Levy, Sir MauriceRobertson, J. M. (Tyneside)
Duncan, J. Hastings (York, Otley)Lewis, John HerbertRobinson, S.
Dunn, A. Edward (Camborne)Lloyd-George, Rt. Hon. DavidRobson, Sir William Snowdon
Edwards, Sir Francis (Radnor)Lundon, T.Roch, Walter F. (Pembroke)
Erskine, David C.Lynch, A. (Clare, W.)Rogers, F. E. Newman
Essex, R. W.Macdonald, J. M. (Falkirk Burghs)Rose, Sir Charles Day
Evans, Sir S. T.Maclean, DonaldRussell, Rt. Hon. T. W.
Everett, R. LaceyMacNeill, John Gordon SwiftSamuel, Rt. Hon. H. L. (Cleveland)
Falconer, J.MacVeigh, Charles (Donegal, E.)Samuel, S. M. (Whitechapel)

no legal authority present, and if he is right, even if we leave out "of" and put in "not exceeding," we do not alter the Act to which he has alluded. What we want to know is: Has the magistrate to inflict a fine of £20, or can he inflict a fine of a lesser amount? As the Bill stands he seems bound to inflict a fine of £20. We shall be satisfied if we get an assurance from the right hon. Gentleman that the Amendment of my hon. Friend is not necessary. If he cannot give us that assurance, we must divide.

Perhaps the difficulty would be met if we incorporated some reference to the previous Act in the present Clause

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

The Committee divided: Ayes, 179; Noes, 57.

Schwann, Sir C. E. (Manchester)Thorne, G. R. (Wolverhampton)White, Sir Luke (York, E. R.)
Seely, ColonelThorne, William (West Ham)Whittaker, Rt. Hon. Sir Thomas P.
Shaw, Sir Charles E.Tomkinson, JamesWilliams, J. (Glamorgan)
Shipman, Dr. John G.Trevelyan, Charles PhilipsWilliams, W. Llewelyn (Carmarthen)
Snowden, P.Verney, F. W.Williamson, Sir A.
Soares, Ernest J.Walker, H. De R. (Leicester)Wilson, Hon. G. G. (Hull, W.)
Steadman, W. C.Walsh, StephenWilson, W. T. (Westhoughton)
Stewart, Halley (Greenock)Waring, WalterWood, T. McKinnon
Stewart-Smith, D. (Kendal)Wason, Rt. Hon. E. (Clackmannan)Yoxall, Sir James Henry
Straus, B. S. (Mile End)Wason, John Cathcart (Orkney)
Summerbell, T.Watt, Henry A.TELLERS FOR THE AYES.—Mr. Joseph Pease and Sir E. Strachey.
Taylor, John W. (Durham)White, Sir George (Norfolk)
Thomas, Sir A. (Glamorgan, E.)White, J. Dundas (Dumbartonshire)

NOES.

Acland-Hood, Rt. Hon. Sir Alex. F.Fell, ArthurMorrison-Bell, Captain
Anson, Sir William ReynellFletcher, J. S.Nicholson, Wm. G. (Petersfield)
Balcarres, LordForster, Henry WilliamPease, Herbert Pike (Darlington)
Banbury, Sir Frederick GeorgeFullerton, HughPowell, Sir Francis Sharp
Baring, Capt. Hon. G. (Winchester)Gardner, ErnestRawlinson, John Frederick Peel
Brotherton, Edward AllenGoulding, Edward AlfredRoberts, S. (Sheffield, Ecclesall)
Bull, Sir William JamesGretton, JohnRutherford, John (Lancashire)
Burdett-Coutts, W.Haddock, George B.Rutherford, Watson (Liverpool)
Butcher, Samuel HenryHamilton, Marquess ofSalter, Arthur Clavell
Campbell, Rt. Hon. J. H. M.Harrison-Broadley, H. B.Smith, Abel H. (Hertford, E.)
Carlile, E. HildredHills, J. W.Stone, Sir Benjamin
Cecil, Lord R. (Marylebone, E.)Hope, James Fitzalan (Sheffield)Thomson, W. Mitchell- (Lanark)
Clyde, J. AvonJoynson-Hicks, WilliamTuke, Sir John Batty
Coates, Major E. F. (Lewisham)Kimber, Sir HenryValentia, Viscount
Corbett, T. L. (Down, North)King, Sir Henry Seymour (Hull)Warde, Col. C. E. (Kent, Mid)
Courthope, G. LoydLaw, Andrew Bonar (Dulwich)Wortley, Rt. Hon. C. B. Stuart-
Craig, Captain James (Down, E.)Lockwood, Rt. Hon. Lt.-Col. A. R.Younger, George
Douglas, Rt. Hon. A. Akers-MacCaw, Wm. J. MacGeagh
Duncan, Robert (Lanark, Govan)Mason, James F. (Windsor)TELLERS FOR THE NOES.—Mr. Renwick and Col. Hall Walker.
Faber, George Denison (York)Morpeth, Viscount

moved, in Sub-section (4), to leave out the words "appropriated to a contract note." ["All Stamp Duties on a contract note are to be denoted by an adhesive stamp appropriated to a contract note."]

The object of this Amendment is to raise the question of the necessity imposed by Sub-section (4) of the Clause on stockbrokers to keep special stamps for contract notes in their office. Under the provisions of the law as they stand the requirements as to stamping may be met by ordinary stamps, but if Clause 57 is passed in its present form there will be a very considerable variety of contract stamps required, and stockbrokers will have to have special stamps. I find on looking at Clause 57 that there are 10 different kinds of stamps which the stockbroker will have to have in his till, and only one of those 10 stamps reaches the amount of £1. He would have to have in his office special stamps for 2s., 4s., 6s., 8s., and so on up to 18s. and £1, and it is putting an unnecessary strain upon a small man's capital to have all these stamps in stock. A man may have a great number of contracts during the day, but he never knows from day to day what orders are coming in, and he cannot always be provided with the exact amount of stamps. I suggest that as long as a man pays the duty, whether in one class of stamp or another, and the Government gets the tax, surely the convenience of the broker might be considered, and he might be allowed to put on three, four, or 20 shilling stamps, and not have one special stamp appropriate to each amount.

The lowest stamp a stockbroker will have to keep in his office is a 6d. stamp in the future. That has not been so in the past. To a great extent he only had to keep one class of stamp in stock. It is rather important from the point of view of revenue that we should have some statistics available which would enable us to know what is happening with regard to these notes, and it is much more important that we should know, in view of the objections which have been urged by hon. Gentlemen opposite, as to the effect upon the revenue and upon business of the increase in Stamp Duties.

Do I understand 40 6d. stamps on a contract note, if they can be got on, will carry out the desire of the Government, or is there to be a £1 stamp? That is the only point I raise.

I cannot answer that off-hand, but I will consider the point, and if it meets the statistical difficulty I see no objection to accepting it.

The reason my hon. Friend has moved this Amendment is that there might be considerable difficulty if a contract note for £20,000 stock was obliged to be stamped with one particular stamp of £1. Up to the present we have always been able to put on a sufficient number of stamps to make up the amount.

There will be no objection at all to making it up with 20, 30, or 40 6d. stamps.

That is not in the Bill. Will the right hon. Gentleman give an undertaking to introduce words which will carry out his intention on the Report stage?

Amendment, by leave, withdrawn.

moved, at the end of Sub-section (5), to insert the words "and shall be recoverable as part of such charge."

Sub-section (5) says, "Any Stamp Duty on a contract note may be added to the charge for brokerage or agency." It is a permissive Clause. Some cantankerous person may say, "It is a permissive Clause and I shall not pay," and a great deal of trouble might arise.

If there is any doubt or difficulty I see no objection to accepting the words.

Amendment agreed to.

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

Clause 59—(Extension Of Provisions As To Contract Notes To Sale Or Purchase Of Options)

The provisions of this Part of this Act as to contract notes shall apply to any contract under which an option is given to purchase or sell any stock or marketable

Division No. 716.]

AYES.

[8.25 p.m.

Abraham, W. (Cork, N. E.)Barran, Sir John NicholsonCollins, Sir Wm. J. (St. Pancras, W.)
Adkins, W. Ryland D.Bell, RichardCorbett, A. Cameron (Glasgow)
Agnew, George WilliamBelloc, Hilaire Joseph Peter R.Corbett, C. H. (Sussex, E. Grinstead)
Alden, PercyBerridge, T. H. D.Cornwall, Sir Edwin A.
Allen, A. Acland (Christchurch)Bethell, Sir J. H. (Essex, Romford)Cox, Harold
Allen, Charles P. (Stroud)Boulton, A. C. F.Crosfield, A. H.
Ambrose, RobertBrigg, JohnCross, Alexander
Ashton, Thomas GairBright, J. A.Dalziel, Sir James Henry
Asquith, Rt. Hon. Herbert HenryBurns, Rt. Hon. JohnDavies, Ellis William (Eifion)
Balfour, Robert (Lanark)Burt, Rt. Hon. ThomasDavies, Sir W. Howell (Bristol, S.)
Barker, Sir JohnCarr-Gomm, H. W.Dobson, Thomas W.
Barlow, Sir John E. (Somerset)Chance, Frederick WilliamDuffy, William J.
Barnard, E. B.Clough, WilliamDuncan, C. (Barrow-in-Furness)
Barnes, G. N.Collins, Stephen (Lambeth)Duncan, J. Hastings (York, Otley)

security at a future time at a certain price, as it applies to the sale or purchase of any stock or marketable security, but if any person proves to the satisfaction of the Commissioners that he has paid the duty on the contract note in respect of any such option, and that Stamp Duty has subsequently been paid on a contract note for a sale or purchase of the stock or marketable security effected in pursuance of the option, the Commissioners shall repay to him the amount paid as the Stamp Duty on the contract note for the option.

Amendments made: After the word "given" ["under which an option is given"], to insert the words "or taken."

To leave out all the words after the words "purchase of any stock or marketable security," and to insert instead thereof, "the Stamp Duty on such a contract shall be one-half only of that chargeable on a contract note: Provided that if under the contract a double option is given or taken the contract shall be deemed to be a separate contract in respect of each option.

"(2) Any contract note made or executed in pursuance and in consequence of the exercise of an option given or taken under a contract duly stamped in accordance with the provisions of this Section shall be charged with one-half only of the duty which would otherwise have been chargeable thereon under this Part of this Act provided that it bears on its face a certificate by the broker, agent, or other person mentioned in the last preceding Section to the effect that it is made or executed in the exercise of an option for which a duly stamped contract has been rendered on the date mentioned in the certificate."—[ Mr. Hobhouse]

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

The Committee divided: Ayes, 191; Noes, 56.

Dunn, A. Edward (Camborne)Lever, A. Levy (Essex, Harwich)Roberts, Charles H. (Lincoln)
Dunne, Major E. Martin (Walsall)Levy, Sir MauriceRobertson, Sir G. Scott (Bradford)
Edwards, Sir Francis (Radnor)Lewis, John HerbertRobertson, J. M. (Tyneside)
Elibank, Master ofLloyd-George, Rt. Hon. DavidRobinson, S.
Erskine, David C.Lundon, T.Roch, Walter F. (Pembroke)
Essex, R. W.Lynch, A. (Clare, W.)Roe, Sir Thomas
Evans, Sir S. T.Macdonald, J. M. (Falkirk Burghs)Rogers, F. E. Newman
Everett R. LaceyMaclean, DonaldRose, Sir Charles Day
Falconer, J.MacNeill, John Gordon SwiftRussell, Rt. Hon. T. W.
Fiennes, Hon. EustaceMacVeagh, Jeremiah (Down, S.)Samuel, Rt. Hon. H. L. (Cleveland)
Findlay, AlexanderMacVeigh, Charles (Donegal, E.)Samuel, S. M. (Whitechapel)
Fuller, John Michael F.M'Callum, John M.Schwann, Sir C. E. (Manchester)
Fullerton, HughM'Laren, H. D. (Stafford, W.)Seely, Colonel
Gibb, James (Harrow)M'Micking, Major G.Shaw, Sir Charles E. (Stafford)
Gibson, J. P.Mallet, Charles E.Shipman, Dr. John G.
Gill, A. H.Markham, Arthur BasilSnowden, P.
Glendinning, R. G.Marnham, F. J.Soares, Ernest J.
Glover, ThomasMassie, J.Steadman, W. C.
Grey, Rt. Hon. Sir EdwardMasterman, C. F. G.Stewart-Smith, D. (Kendal)
Gulland, John W.Meagher, MichaelSummerbell, T.
Gwynn, Stephen LuciusMenzies, Sir WalterTaylor, John W. (Durham)
Harcourt, Rt. Hon. L. (Rossendale)Middlebrook, WilliamThomas, Sir A. (Glamorgan, E.)
Harcourt, Robert V. (Montrose)Molteno, Percy AlportThorne, G. R. (Wolverhampton)
Harmsworth, R. L. (Caithness-shire)Montagu, Hon. E. S.Thorne, William (West Ham)
Haworth, Arthur A.Muldoon, JohnTomkinson, James
Hazleton, RichardMurray, Capt. Hon. A. C. (Kincard.)Trevelyan, Charles Philips
Hedges, A. PagetMyer, HoratioVerney, F. W.
Helme, Norval WatsonNannetti, Joseph P.Wadsworth, J.
Henderson, Arthur (Durham)Newnes, F. (Notts, Bassetlaw)Walker, H. De R. (Leicester)
Henderson, J. McD. (Aberdeen, W.)Norman, Sir HenryWalsh, Stephen
Henry, Charles S.Norton, Captain Cecil WilliamWalters, John Tudor
Herbert, Col. Sir Ivor (Mon. S.)Nussey, Sir WillansWaring, Walter
Hobhouse, Rt. Hon. Charles E. H.Nuttall, HarryWarner, Thomas Courtenay T.
Holt, Richard DurningO'Donnell, C. J. (Walworth)Wason, Rt. Hon. E. (Clackmannan)
Hooper, A. G.O'Kelly, Conor (Mayo, N.)Wason, John Cathcart (Orkney)
Horniman, Emslie JohnO'Malley, WilliamWatt, Henry A.
Isaacs, Rufus DanielParker, James (Halifax)White, Sir George (Norfolk)
Jackson, R. S.Partington, OswaldWhite, J. Dundas (Dumbartonshire)
Jenkins, J.Pearce, Robert (Staffs, Leek)White, Sir Luke (York, E. R.)
Jones, Leif (Appleby)Philipps, Col. Ivor (Southampton)Whittaker, Rt. Hon. Sir Thomas P.
Jones, William (Carnarvonshire)Pickersgill, Edward HareWilkie, Alexander
Joyce, MichaelPirie, Duncan V.Williams, J. (Glamorgan)
Keating, M.Pointer, J.Williams, W. Llewelyn (Carmarthen)
Kelley, George D.Pollard, Dr. G. H.Williamson, Sir A.
King, Alfred John (Knutsford)Ponsonby, Arthur A. W. H.Wilson, W. T. (Westhoughton)
Laidlaw, RobertPriestley, Arthur (Grantham)Wood, T. M'Kinnon
Lamb, Edmuld G. (Leominster)Raphael, Herbert H.Yoxall, Sir James Henry
Lamb, Ernest H. (Rochester)Rea, Rt. Hon. Russell (Gloucester)
Lamont, NormanRees, J. D.TELLERS FOR THE AYES.—Mr. Joseph Pease and Sir E. Strachey.
Layland-Barratt, Sir FrancisRichards, T. F. (Wolverhampton, W.)
Lehmann, R. C.

NOES.

Acland-Hood, Rt. Hon. Sir Alex. F.Forster, Henry WilliamRawlinson, John Frederick Peel
Anson, Sir William ReynellGardner, ErnestRenwick, George
Balcarres, LordGoulding, Edward AlfredRidsdale, E. A.
Banbury, Sir Frederick GeorgeGretton, JohnRoberts, S. (Sheffield, Ecclesall)
Baring, Capt. Hon. G. (Winchester)Haddock, George B.Rutherford, John (Lancashire)
Brotherton, Edward AllenHamilton, Marquess ofRutherford, Watson (Liverpool)
Burdett-Coutts, W.Harrison-Broadley, H. B.Salter, Arthur Clavell
Butcher, Samuel HenryHermon-Hodge, Sir RobertSmith, Abel H. (Hertford, East)
Campbell, Rt. Hon. J. H. M.Hills, J. W.Stone, Sir Benjamin
Carlile, E. HildredHope, James Fitzalan (Sheffield)Thomson, W. Mitchell- (Lanark)
Cecil, Lord R. (Marylebone, E.)Kimber, Sir HenryTuke, Sir John Batty
Cldye, J. AvonKing, Sir Henry Seymour (Hull)Valentia, Viscount
Coates, Major E. F. (Lewisham)Law, Andrew Bonar (Dulwich)Walker, Col. W. H. (Lancashire)
Corbett, T. L. (Down, North)Lockwood, Rt. Hon. Lt.-Col. A. R.Warde, Col. C. E. (Kent, Mid)
Craig, Captain James (Down, E.)MacCaw, William J. MacGeaghWortley, Rt. Hon. C. B. Stuart-
Douglas, Rt. Hon. A. Akers-Mason, James F. (Windsor)Younger, George
Duncan, Robert (Lanark, Govan)Morpeth, Viscount
Faber, George Denison (York)Morrison-Bell, CaptainTELLERS FOR THE NOES.—Mr. Joynson-Hicks and Sir W. Bull.
Fell, ArthurPease, Herbert Pike (Darlington)
Fletcher, J. S.Powell, Sir Francis Sharp

Part Vi—Customs And Excise Other Than Liquor Licence Duties

Clause 60—(Duty On Tea)

The duty of Customs payable on tea until the first day of July nineteen hundred and nine, under the Finance Act, 1908, shall be deemed to have been continued as from that date, and shall continue to be charged, levied, and paid until the first day of July nineteen hundred and ten, on the importation thereof into Great Britain or Ireland (that is to say)—tea, the pound, fivepence.

I beg to move to leave out the words "until the first day of July nineteen hundred and nine, under the Finance Act, 1908, shall be deemed to have been continued as from that date, and shall continue to be charged, levied, and paid." This Amendment which stands in the name of the hon. Member for East Mayo (Mr. Dillon) is really a drafting Amendment, the omission of these words being necessary in order to make it possible to move further down that the duty should be reduced from 5d. to 4d. the pound. I hope it will be open for us on this Amendment to discuss the proposal to make the alteration in the amount of the duty. No one agrees more fully than I do with the principle laid down by the Chancellor of the Exchequer that taxation should be levied upon luxuries, and not upon necessities. My complaint is that he has not applied his own principle, or not made the application of it sufficiently thorough. I cannot admit that tea under modern conditions of life is not a necessity in this country. Bread will remain until the end an article of necessity. I think tea comes next to bread. I believe there are people who use tea who cannot afford butter or even milk. I am perfectly certain that there are tens of thousands of people in this country and Ireland who never think of buying meat but who buy tea. I will not say it comes before sugar. It is a difficult question. At all events, I think that on the Chancellor of the Exchequer's own principles there is the strongest possible case for a reduction of the duty upon tea. I recognise that the money has got to be got somehow, but I do not feel for a moment that the Chancellor of the Exchequer has exhausted the possibilities of taxes on those things which are called luxuries, but which nevertheless are articles of consumption. If it is a question between raising money by a tax on tea and one on mineral waters, they are certainly a legitimate article of taxation as far as I can see. There is not the least doubt about it that aerated waters are a luxury, and that a tax on them is a form of taxation which would hit every class without distinction, the man who drinks alcohol and the man who does not. Practically, I believe the reason why the revenue is raised so much from tea and tobacco is simply that the Customs Department continue upon the line of least resistance, and they continue adding duties where already there are duties imposed, and they will not break new ground. If the Chancellor of the Exchequer is to succeed in the project which he has put before him, he must look carefully around and discriminate between articles which are really luxuries and articles which really under modern conditions are articles of necessity. Speaking here as an Irish Member, we have always protested against the unduly heavy taxation levied on tea, which for people in Ireland, and particularly for poor people in Ireland, is a matter of necessity. I remember going into the house of a small farmer, such as are found in thousands all through the country, seeing him sit down at twelve o'clock in the day to drink strong tea, and saying to him what many of us think as to people spoiling their health by drinking tea. His answer was, "If you came in from a day's ditching or from ploughing in wet, heavy ground you would find the need of something," as he put it, "that would raise the heart." It is a stimulant, and the most necessary stimulant which those people have. By your heavy taxation you raise no doubt a considerable sum, but a sum which I hold could be raised without putting any extra tax on the necessaries of life.

I am opposed to this tax upon tea not merely from the Irish point of view, but also on general grounds. I regard it as a tax on food. I must say it is rather hard to have to ask the Chancellor of the Exchequer to remove or diminish a tax upon tea at a moment when the demands on the public purse are so gigantic as they are, but I have always felt in regard to the tax on tea that it has every single possible defect of a tax. In the first place, it is a tax upon food; in the second place, it is an indiscriminate tax in the sense that it is equally large on what I may call the tea of the luxurious and the tea of the poor. The tax presses perhaps rather more hardly on certain parts of Ireland than in England, but it does press hardly also in England. Take one of the most pitiful classes in the country—the unskilled women workers, the small seamstress, the dressmaker, and the charwoman. To her, of course, tea is not merely the stimulant that tea is, but it is also the substitute for meat and for other nutritious forms of food, and, of course, at 1s. or 1s. 2d. or 1s. 3d. that she takes pays exactly the same tax as the tea at 3s., 4s., or 5s. a pound which is drunk by those in better circumstances. The reason why it affects Ireland perhaps a little more than England, though I do not want to put that part of the case too strongly, because I have such general sympathy with the English part of the case as well as the Irish—is that to a certain extent tea is drunk more universally in Ireland than in England. It must be granted, I admit, that the people of Ireland sometimes drink a great deal too much tea, and they drink the tea not properly infused as it should be, but very often boiled until it becomes really a noxious rather than a helpful or healthy beverage. But we must look at the circumstances of these people. Many of them cannot afford to eat meat except at rare intervals. Many of them are very hard worked. They live in a humid, and therefore somewhat depressing climate, and many of them live upon the sea shore, and the result is that tea has become in Ireland a drink so frequently and so universally used that it may be regarded as one of the primary necessities of life in Ireland. On one occasion I read to the House the famous, I might almost call it the historic, Budget of the family in the West of Ireland in what they call the congested districts, which was published in the schedules to a report by the Congested Districts Board. If I remember aright, one of the largest items in the Budget, which I believe amounted to something like £10, was tea. My objection to the Tea Duty, also, is that it is an indirect tax. Personally I have a leaning towards a recourse to direct taxation as against indirect taxation. I have never regarded it as a rational defence of indirect taxation to say that the taxpayer pays the indirect tax more unconsciously than he does a direct tax. It is absurd to say that you should use a tax as a means of duping the people. They ought to know what they are paying. There is no defence in saying that they are unconscious of what they are paying; I think it is rather an aggravation of the evil. The Chancellor of the Exchequer has left the tax as it stands, and in circumstances of such difficulty I am not surprised. At the same time, we hope that the day will come when he or some other Chancellor of the Exchequer will be able to carry out the good old Liberal doctrine which was enunciated so far back, I think, as 30 years ago, by one of the greatest Liberals that ever lived in this country, namely, John Bright—the programme of "the free breakfast table." Another defence of the tax is that all classes of the community by being taxed should have an interest in keeping down the expenditure of the country. I must say that argument has never made any appeal to me; I regard it as an unreal argument. Does anybody suppose that the charwoman who pays a tax on tea has really any influence in either making or preventing a war, or any influence in great transactions of the State? The subsistence of human beings should be free from taxation in all countries, and, in my opinion, under all conditions. Therefore I join with my hon. Friend the Member for the City of Galway (Mr. Gwynn) in protesting against this tax.

I have an Amendment on the Paper to reduce this tax, but as the general discussion is being taken on the Amendment before the Committee, I will proceed to make the few remarks I have to offer on the main question as to whether the Tea Duty should be reduced. Tea is at the present time a stationary article of consumption, notwithstanding the fact that the population of this country is growing rapidly. During the last three years the import of tea has been 321,000,000 lbs., 317,000,000 lbs., and 323,000,00 lbs., showing practically that this necessary of life is, to all intents and purposes, stationary. Therefore I should say, from that fact alone, that there is something slightly wrong, whether it is the tax upon it or whatever it may be. This article of universal consumption among rich and poor should increase proportionately with the population. The next point I wish to make is that when this duty used to be fixed at about 4d. it bore in those days a very small proportion to the value of the tea. The duty has gone up and the value of the tea has gone down, so that proportionately the amount which one now pays in duty to the Government is very much higher than it was in years gone by, when the duty was approximately 4d. At that figure it used to bring in about £3,500,000. The duty of 4d. continued down to the time of the Boer War, when money was urgently needed. It was put up to 6d., and then again to 8d., and directly the war was over it was reduced again to 6d. The present Prime Minister, about two years ago, reduced it by 1d., leaving it at 5d. So that we still continue, in the matter of tea, to pay 1d. per lb. war tax. Another reason why this duty might be reduced is that it is continuing to pay a far higher percentage of increased duty than other articles. The tax on beer was raised and continued to pay the war duty, but that duty is very much lower proportionately than is the Tea Duty. That is a further reason why I think this matter should be looked into, and considered whether it is a tax which should be kept, as I might describe it, permanently at this rate of 5d. Tea at the present time is only worth from 7d. to 9d. par pound, and 5d. on that, you will see, is a very heavy percentage, being 60 or 70 per cent. of the value of the tea, whilst in days gone by the tax amounted at from 33 to 50 per cent. at the outside on the value of the tea. It may be an unreasonable time to propose that the Government should reduce the duty, because every penny of the Tea Duty produces £1,200,000, and to ask the Government to give up £1,200,000 at the present time would be hardly reasonable. While agreeing that the Government, with its present views on orthodox taxation, cannot give up this sum, still we, sitting on these benches, think we are in duty bound to put forward an Amendment for its reduction, because we think we have other means by which this money could be found without taxing this article so highly as it is. The duties on champagnes and wines have not been touched by this Budget. They remain the same as they have done for years past. [An HON. MEMBER: "They are not for working men."] Working men do not drink champagne, they drink tea, and I am advocating that the duty on champagnes and wines might have been increased to some exent—I do not say how much—instead of this duty upon what I call a prime necessary of life. As has been so ably put by hon. Gentlemen below the Gangway in Ireland, it is an absolute necessary of life; but I think equally in England it is a necessary of life, for it is consumed in the poorest cottage as well as in the richest palace. Yet the duty it bears as an article of food is altogether out of proportion to that imposed on any other article which we consume in this country. It is a stimulant, no doubt, but you cannot compare it in any way with intoxicating liquor. I only refer to that because it is the only thing that is taxed more than this. It is a far higher tax than on any other of the necessaries of life. I think that the Government, although they may not be able to try it this year, may be able to reduce this duty, and I think we should enter this protest and vote against it.

I wish to associate myself with the statement by the Irish Members as to this tax, owing to the great severity with which it presses on the poor people and owing to the deeper poverty of the people in Ireland. I do not know if the hon. Member who has just spoken has spoken in any representative capacity on behalf of his party, or if he is expressing only his own personal opinion; but if there be any very considerable volume of opinion on the Tory Benches in sympathy with what the hon. Member has said, may I remind them of the fact that if it had not been for the fact that when the Conservative party last had the control of the finances of the country they raised the tea duty, we should not to-night be discussing a proposal for its reduction from 5d. to 4d. I want to deal with this question first of all on general grounds, as in opposition to all forms of indirect taxation, and in the second place on the ground that the taxation paid by the working people of this country at the present time is undoubtedly severe and altogether out of proportion to their means. A statement was made this afternoon in the course of the Debate upon the Stamp Duty by an hon. Member who sits opposite, that by the proposals of this Budget all classes of the community were being called upon to pay a fair contribution to the expenditure of the State. I want to join issue upon that statement. It is now nearly five months since the Chancellor of the Exchequer made his Budget statement to this House. During the greater part of that tame we have been discussing these proposals, and now, after some months of the Committee stage, we have reached for the first time, to-night, the consideration of a tax which may strictly be called a working-class tax. Several months of time have been devoted to the discussion of the taxes which bear more directly upon the richer classes of the community. Now, therefore, those persons who claim in a special sense to represent the working people of this country are entitled to some part of the time of the Committee in order to bring forward their statements.

9.0 P.M.

The Chancellor of the Exchequer has more than once, I think, made the statement that this Budget is an attempt to apportion taxation justly between different sections of the community. I shall deal with that contention or statement from two points of view. First of all, I want to see whether the pre-existing taxation was a fair distribution. In the course of the discussion a few days ago on the Income Tax, a statement was made by an hon. Member who sits on the Tory Benches, and represents one of the Divisions of Sheffield, that the proportion of indirect taxation to the total revenue of the country was about 42 per cent., and that about 58 per cent. was direct, I interjected an inquiry at the time as to whether he included stamps under the heading of direct taxation, and he replied that he had. It appears to me that the Stamp Duty lies between the heaven of direct taxation and the hell of indirect taxation. But I dispute the hon. Gentleman's figures altogether. Even including stamps under the heading of direct taxation, what are the actual facts? Under the present Finance Bill, in the proposals of taxation, the Chancellor proposes to raise for the current financial year a sum of £129,000,000. I exclude the revenue from the Post Office, and only include what would be legitimately called taxation, and which would amount to £129,000,000. The amount raised by Customs and Excise is £67,000,000, or, to be precise. £66,800,000. The amount to be raised by direct taxation totals £62,000,000 excluding stamps. Now, £67,000,000 represents something like 53 per cent. of the revenue of the country derived from indirect taxation by Customs and Excise, leaving somewhere about 47 per cent. to be raised by direct taxation from the class who are best able to pay it. I do not think I would be in error if I were to assume that, of the Customs and Excise revenues, four-fifths is paid by what we may call the working classes of the country. Therefore, that means that £53,408,000 will be contributed during the financial year by four-fifths of the population, that is, the working classes. That works out at £7 12s. 6d. per family. I have in my possession a leaflet that I treasure very highly, a leaflet issued as an election leaflet by the Liberal party, and I believe the right hon. Gentleman the Chancellor of the Duchy is President of the Association. That leaflet did duty on behalf of the Liberal party at the last General Election. It is headed, "How the Working Man is Taxed." The leaflet goes on to state during that financial year the sum of £65,000,000 was raised in Customs and Excise. That is a lower sum by nearly £3,000,000 than will be raised during the current financial year. It goes on to point out that that represents £7 5s. per head, or rather per family. The figure I give, £7 12s. 6d., is of course for the current financial year with a larger revenue from Customs and Excise. The leaflet goes on to make a calculation as to the amount of taxation contributed by the working classes of the community. It takes Sir Robert Giffen's figure of £70 a year as the average income of a working-class family, and then saying that, perhaps, the average income may be a little higher, it works out a calculation on the basis of £90 a year as the average income. It makes out, therefore, that at that time the amount of taxation contributed by the strictly working classes of the community worked out at 1s. 7d. in the £ of income. I want to make a calculation of my own. I will not grant that the average income of a working class family is £90 a year. As a matter of fact, it is indisputable that there are more than two million families in this country whose income does not amount to £1 a week. Therefore, in the cases of those families, representing a population of something like ten millions, the amount of taxation they are going to be called upon to contribute under this Budget works out at more than 2s. 6d. in the £ of income. That is the taxation which is going to be levied under a Budget which claims—and this is the distinct claim by which it is recommended to the approval of the democracy of the country—that it spreads taxation fairly, justly, equitably, and equally between the different sections of the community. I have also a leaflet which is doing duty at the present time, issued by the Liberal Publications Department headed in large type, "The Biggest Burden for the Broadest Back," a very good piece of alliteration. It says: "All classes of the community ought, to be called upon to bear their share, the biggest burden falling on the broadest back." Yes, but which is the broadest back? It seems to me that in this case the Chancellor of the Exchequer has got the backs of all the working people of the country into one back, and is regarding that as the broadest back. What is the amount of new taxation being levied this year which will be paid by the working people? The right hon. Gentleman is proposing to put £1,900,000 on tobacco, £1,600,000 on spirits, and, although it may be disputed that this is a tax which will be paid by the working people, £2,600,000 on extra Licence Duties. We had a discussion on the Licence Duties a week or so ago, when the Prime Minister made a frank confession that the increased Beer Duty, at any rate, would be paid by the working people. If the brewers are-able to recoup themselves for the extra duty they will have to pay for the privilege of brewing, it is perfectly certain that they will be able to recoup themselves also for the extra duty they will have to pay for the privilege of carrying on the retail trade. These three increased duties amount to £6,100,000 out of a total increase of duties amounting to just over £13,000,000. Therefore, according to the original Budget statement, which, of course, was made before any of the concessions which have since been granted were given, the Chancellor of the Exchequer proposed to put over £6,000,000 extra upon three articles which are largely used and consumed by the working people, and to take only an additional £7,000,000 from taxes, which would in the main be contributed to by the richer members of the community. The right hon. Gentleman calls that a fair, just, equal, and equitable distribution of the burden.

If the right hon. Gentleman had been listening to my speech he would have heard me say that some objection might be taken to my statement that licences were a form of taxation paid by the working classes.

Is it the view of the hon. Member that the increased duty on licences will be put on the backs of the working people?

It is my view, certainly. The Chancellor of the Exchequer himself stated that the trade were not only going to recoup themselves for the £2,000,000 they were to be directly charged, but were taking an extra £20,000,000.

If the hon. Member is going to do me the honour of quoting me, he might as well quote me accurately. I said that if they put ½d. on beer, which I stated they were not justified in doing, they would be taking not merely the two millions, but 20 millions.

An increase in price was made immediately after the Budget statement, and that is being paid by the community. On these considerations I submit that the proposals of the Government are not a fair, just, equal, and equitable distribution of the burden. Another point is the classification. The Chancellor of the Exchequer, in his Memorandum explanatory of the Budget statement, pointed out that during the last 12 months there had been an increase of £50,000,000 in the total incomes assessed to Income Tax. It is evident, therefore, that there is one part of the community which is growing richer, and consequently the capacity of that class to pay increased taxation is undoubted and indisputable. But what about the capacity of the working people of the country to pay increased taxation? A few days ago the monthly "Labour Gazette" of the Board of Trade was issued, and under the heading, "Changes in the Rates of Wages," it was stated that during the month of August there was a net decline in the amount of wages of £69,081. For every month of the last 16 months the Board of Trade have been reporting decreases in wages. Upon the basis of the decline of last month there has been this year a decline in wages of £3,607,000. Up to the beginning of the current year there has been a decline in wages, as compared with the beginning of 1901, of just under £2,000,000. Hence, wages to-day are lower by £5,532,000 than they were at the beginning of 1901. Therefore, in the matter of income, the capacity of the working people to pay taxation is considerably lower than it was eight years ago. The value of wages, of course, must be judged by their purchasing power. What is the purchasing power of these reduced wages to-day as compared with that of the higher wages eight or ten years ago? A few months ago a co-operative society issued a circular giving a list of prices at the present time as compared with ten years ago. They give a typical working-class Budget, which includes expenditure upon bacon, butter, flour, lard, beans, sugar, and tea. Upon these necessary articles there have in ten years' time been an increase in wholesale prices of no less than 9.9 per cent. Therefore, the cost of living to-day is increased. Those are, of course, articles of consumption. Other articles had increased in similar or larger proportion—in one case 33 per cent. In view of this reduced capacity on the part of working people, it is not just to impose upon them a burden of taxation almost equal to the increased burden which is going to be placed upon the wealthy classes. I referred to the increase in the amount of income returned to the Commissioners of Inland Revenue. Let us go a little further back. We are sometimes charged with making statements in regard to the condition of the people that are not correct. We sometimes, for instance, make the statement that the rich are getting richer and the poor poorer. I am prepared to make that statement anywhere, and to stand by it. The rich are getting richer, rapidly richer and dangerously richer. Last year these classes admitted—and the return does not represent by any means the total income they received—to the Commissioners of Inland Revenue that they had taken £1,040,000,000. In 1395—only 14 years ago—the corresponding amount was only £657,000,000. So that there has been an increase of something like £400,000,000 in 14 years. And we find that this increase has not been by arithmetical, but almost by geometrical, progression. I submit therefore that these facts justify us in protesting against the amount of taxation which this Finance Bill is going to put upon the working people of this country.

Can the hon. Member give us the number of taxpayers in 1895 and last year?

The number of taxpayers is not known. Sir Henry Primrose, in his evidence before the Income Tax Commission, stated that the estimate of the Commissioners of Inland Revenue as to the number of taxpayers was just over 1,000,000. The figures are not actually known. May I point out this: That income was included in the total in other years that is not now included. Before Sir William Harcourt's Budget incomes of £150 were included. He raised the amount to £160. Now I am glad to be able to say that there are right hon. Gentlemen sitting upon the Treasury Bench who support our position. The First Lord of the Admiralty, speaking at Newport, said:—

"He did not exactly know why it was that dukes lamented so much. They were not to be hurt. Of the money which was to be raised, no less than £12,000,000 were to be paid by the great mass of the people, and not specially by rich people. The bulk of the millions was to come from the working classes and the poorer members of the community. It was in only one or two of the taxes that the dukes and those associated with them were particularly concerned."
So much for what I described as my objection on general grounds to this new duty. Just a few words as to my objection to it as a tax. I do not suppose there is any Member of this House who will rise to defend the tax upon any other ground than that the revenue derived from it is necessary. I have often—and I confess I do not like it—heard the Prime Minister defend certain taxes on the ground that they brought in a large amount. That is an argument which might be used to defend the most diabolical tax that human ingenuity ever imposed. Surely we cannot in financial matters altogether neglect moral and social factors. I know the Chancellor of the Exchequer will say when he rises that he cannot dispense with the million revenue which he would have to forego if the Amendment were accepted. It is a million a year, although I should say this, that I have an Amendment upon the Paper, and my colleagues also have similar Amendments upon the Paper, in favour of reducing the duty not by a penny, but by twopence. I do not believe that if the Tea Duty were reduced by one penny only that the benefit would go to the consumer. I think I have the authority or, at any rate, the experience of the Prime Minister to support that contention, because last year—or was it the year before?—[An HON. MEMBER: "1907"]—when a Motion was before the House in favour of the reduction of the Tea Duty. He opposed it on the ground that the time was not opportune, nor would a penny be of any considerable benefit to those for whom it was taken off. Now what is the opinion of the Chancellor of the Exchequer'! Every Member of the House who heard the speech which the right hon. Gentleman made upon the Supplementary Vote for old age pensions in the early part of this year will, I am quite sure, remember that the pathos of it touched the heart of everyone. He described in the most eloquent and touching manner the woes of the British working people. He gave the case of an old woman of between 70 and SO years of age who, in her pride in claiming the old age pension, had returned her income at a larger amount than it was subsequently discovered to be. It was-only 6s. 6d. per week. The right hon. Gentleman said that the old lady practically subsisted upon bread and tea. I suppose if a woman subsists upon bread and tea she will consume about half a pound of tea per week. That poor old woman pays in duty no less than 3d. per week. She is getting an old age pension of 5s. a week, and upon that old age pension she is being charged, by way of Tea Duty, an Income Tax of 1s. in the £. Nobody can justify that.

What are the pledges of Ministers in regard to this matter. The Chancellor of the Exchequer himself spoke in this House during the tenure of office of the last Government in opposition to the increase of the Tea Duty. What did he say? He said in language quite as picturesque as any the right hon. Gentleman has ever used:—
"The additional duty on tea would mean that the working classes would have to drink an inferior quality of tea, and in order to get the most out of it they would allow it to stew. The Budget, therefore, was a Budget to encourage the stewing or tea."
In another Debate on the Tea Duty during the tenure of office of the last Government Sir Henry Fowler, as he then was, speaking on 27th April, 1904, on behalf of the Official Opposition, said, alluding to the Tea Duty, it was liable to all the objections used against any indirect taxation; that in time of peace it had been reduced to 4d., and then raised to 6d. in time of war, and that the first thing the Chancellor of the Exchequer ought to do was to bring it back to 4d. Now we have had three or four Budgets since this Government came into office, but the Tea Duty has not yet been reduced to four-pence. What did the present Prime Minister himself say just before the last General Election? He said:—
"It was the duty of the Chancellor of the Exchequer to set to work at once to effect, as I believe he might easily effect, such reductions in the expenditure of the country as would enable him to withdraw with the shortest possible delay, one-third of the Tea Duty, which was always intended to be of a temporary character."
There is all the difference in the world between being in office and out of office. It reminds me of the story of the two farm labourers who were working together for a great many years, and who developed quite a strong affection for each other. In an unusual outburst of feeling one day one of them said to the other, "If I had two cows, I would give you one of them." As the years went by he prospered and became the possessor of a good many cows, and then his friend reminded him of the promise; and the prosperous man replied, "When I made that promise I had the will but I had not the power; now I have the power but the will is gone." This Tea Duty is, as both of the speakers who preceded me have said, a tax on one of the necessities of life. Tea is an article which is consumed largely by the poorer class of the population, and the Tea Duty is altogether disproportionate. When speaking on this question last year, I made what I thought was a comparison of the proportion of the duty to the retail price, and I said in some cases it amounted to 80 per cent. Some hon. Member who claims to know a great deal about it said in a great many cases it amounted to 120 per cent. Another objection we have to it is that it lets the rich off rather lightly and taxes the poor very heavily. The tea which is largely consumed by the working classes pays as much duty as the expensive tea which is consumed by the wealthy people, and no tax ought to be levied at a high figure which is liable to such injustice in its incidence.

We are the only country in the world that imposes a heavy tax upon tea. The United States of America, which raises the greatest part of its revenue by import duty, lets tea in free. It is quite evident from the schedule of the new Tariff Bill that the United States Government realised its importance and the necessity of their people drinking good tea; the Customs authorities have power to refuse to admit tea or an inferior quality. The result is that taking that in connection with the heavy Tea Duty which is imposed in this country that inferior tea, which the United States will not have is brought to the London market and a duty of 5d. in the pound is put upon it, which makes the retail price in this country very heavy, and therefore the poor people are only able to drink a very inferior tea. Something like 90 per cent. of the tea brought into this country comes from places in our own Empire, and therefore as a matter of Imperial preference the Tea Duty ought to be removed.

A remark was made by one of my colleagues when I was reading extracts from the speeches of Members of the Government when they were in Opposition which seemed to cause enjoyment to hon. Gentlemen now in Opposition. My colleague remarked, "Cheers and speeches come home to roost." I hope hon. Members who are now in Opposition when they come into power will retain the will. I want to say just a few words about our objection to indirect taxation. We object to indirect taxation, and we cannot assent to the suggestions put forward by the hon. Member who moved the Amendment in favour of a tax upon mineral water for the abolition of the Tea Duty. I think one of the most iniquitous taxes would be a tax upon water. We object to indirect taxation because it compels the people to pay taxes without being able to realise what it is that is imposed upon them. In the Debates 100 years or nearly so ago William Pitt used words which clearly expressed the objection in regard to indirect taxation. He said that direct taxes imposed on the people generally might cause a bloody revolution, but he said there is a much better way than that. There is a way which you can tax the last rag from the back, and the last bite from the mouth without those who are taxed being aware of the heavy burdens which are imposed upon them, and that is by imposing taxes upon articles of necessity. The tax will then enter into the price of the article, the people will grumble at the hard times, but they will never know that the hard times are imposed by indirect taxation. That is a conclusive and crushing indictment of indirect taxation. This Tea Duty does not tax according to the ability of the consumer to pay, but according to consumption of a necessity, and it takes a great deal more out of the pockets of the taxpayers than it brings into the Exchequer.

The hon. Gentleman who has just sat down has made a very interesting speech, marked, if I may say so, by a good deal of bitterness and acrimony. I think that is a mistake which the hon. Member has committed, and it is grossly unfair. One might imagine from his speech that this Budget imposed a most heavy burden upon the working classes, and that in comparison with the burdens imposed upon the rich the burdens imposed upon the working classes were very heavy. The hon. Gentleman has been quoted more than once in this House as having said that this was a Budget which he himself rather sketched out a year or two ago, and that we are simply plagiarists. I think he said that I was an apt pupil of his. Now it seems to be rather the other way, because on the platform this is his Budget and here in this House it is ours. What I complain of is this—the hon. Gentleman has been quoted both ways, and has been quoted against us both ways. He has been quoted against us as approving of the Budget, and he will be quoted against us as condemning the Budget. I do not know which condemnation is the most injurious, but I am perfectly certain that a great many of his statements will fill Tariff Reform leaflets in the course of the coming campaign, and, perhaps, that will be some satisfaction to him. I see opposite two Tariff Reformers who appreciate the value of those statements.

I would not mind at all if the hon. Member had really approached fairness in his criticism. It is quite new, coming from him as a Socialist, to say that the £2,000,000 charged in respect of licences would be passed on to the working classes. Certainly that is not the view which we take. Our view is that the tax upon these great brewery concerns, with the exception of London and a few other places, will not be passed on, and I know that in some places where attempts have been made to pass it on to the consumers the brewers have been beaten. Therefore that tax is certainly not a charge upon the working classes of the country. Let me point out another fact which has been very conveniently overlooked by the hon. Member. He has quoted simply the figures for this year. There is one important fact which I think he has overlooked, and that is that the indirect taxation is now practically at its highest, whereas direct taxation is increasing. The taxes which he has quoted are only direct taxes for this year, and he has not quoted what they will produce in the second year. Take for example the Death Duties. Next year and the year after they will produce something between twice and three times as much as this year. Probably the hon. Member never knew that, because he never mentioned it. The hon. Member was actually showing the proportion of direct to indirect taxation in this Budget, and he never referred to the most essential part of the duties which come into operation next year.

The same thing applies to the Land Tax, which is estimated at £500,000. The hon. Gentleman chooses to ignore the fact that these Land Taxes in the future will swell to considerable proportions. He never quoted that, and if he goes through the whole category he will find that he is ignoring the fact that most of these taxes will increase very largely as far as direct taxation goes, whereas indirect taxation is substantially the same. I think that ought to be borne in mind. This Budget alters substantially the proportion between direct and indirect taxation in favour of the working and the poorer classes of the community. Did the hon. Member for Blackburn say that? He assents to it now, but would it not have been worth his while to have mentioned it incidentally?

My plea was this: I have always said to the credit of this Budget that it differs from former Budgets in not increasing the proportion of indirect taxation. The tendency of this Budget is rather to increase the return from direct taxation and leave indirect taxation stationary. What my colleagues protest against, and what I protest against, is the continuance of the aggregate amount of indirect taxation at £60,000,000 or £70,000,000.

What I complain of is that the hon. Gentleman, when he is making his case, ignores every fact that is favourable to the Budget and only dwells on those facts which are unfavourable. He never pointed to the fact that as far as indirect taxation is concerned the proportion is gradually diminishing, whereas as far as direct taxation is concerned it is increasing. In the course of the next three or four years the percentage of direct taxation will enormously increase, whereas indirect taxation will decrease. I hope in the future the hon. Gentleman will be more candid in explaining this Budget to working-class audiences than he has been to the Committee. All we want is that the facts should be presented, and I think we are entitled to ask that. I have given the hon. Member the figures. This year we have about £3,500,000 of indirect taxes and about £8,000,000 of direct taxes. Put the £2,000,000 I have mentioned on and that will be £5,000,000, as against £6,000,000 this year, even assuming that this will be all put on the working classes. What happens next year and the following years? The sum of £12,000,000 is added to the direct taxpayer, and what will be added to the indirect taxpayer? Practically nothing. That completely transforms the proportion.

You have no right to assume what is going to take place next year. The right hon. Gentleman is basing his case upon the assumptions contained in his own estimates, and he is ignoring the fact that he has given away practically the whole of his Land Taxes.

Really the hon. Gentleman might take some trouble to ascertain the elementary facts. He says I have no right to assume what may happen next year, but this is a Bill which raises revenue for next year. The Death Duties, the Succession and the Legacy Duties are all duties for next year. I cannot assume that somebody else will not come in and get rid of them, but then I shall not be responsible, my colleagues will not be responsible, and the Liberal party, for which he has such an affection, will not be responsible. It will be his friends who quote his speeches, and the speeches they quote will help them to do it. I think it is only fair, when these things are being put to the House of Commons and to the country, that the facts should be given. There is another fact which, I think, should be remembered. We really have reduced the Tea Duty from 6d. to 5d. What is the reason we have not reduced it this year? It is because we find ourselves with a deficiency of £16,000,000, of which £8,000,000 or £9,000,000 are for old age pensions. That might incidentally be mentioned, I think, when a case is being made out against the Liberal party of oppression of the working classes. You cannot get rid of all these grievances in a single year. We get nearer year by year. We have got rid of a penny on the Tea Duty, and £3,500,000 on the Sugar Duty, even when we are facing great liabilities, and I venture to say the surprise most people felt was not that we had not taken any of the tax off tea and sugar, but that we had not put them back. That was the real feeling expressed by the vast majority of people; it was a feeling of relief amongst the working classes. That is the position as far as the hon. Gentleman is concerned. I only appeal to him that he should not altogether ignore the facts which represent the case a little more fairly.

Now I come to the hon. Member who moved the Amendment, and the Seconder, and I must say they showed a very different spirit. They quite recognised the financial difficulties of the year. They protested against the Tea Duty. I have joined with them in that protest for about fifteen years. The very first night I came to the House of Commons, and, by the way, it was a Budget night, I voted for the reduction of the Tea Duty. I do not regret it, and nothing would give me greater satisfaction than to take a penny, twopence, or even threepence off the Tea Duty. I do not recede a single inch from anything I have said about the hardship of these duties, so far as the poorest of the poor are concerned, and I take some pride in the fact that I have not increased them even when the necessities of the country demand £16,000,000 of money. I do not believe anyone standing in my place, not even the hon. Gentleman, would this year propose to decrease the Tea Duty. Taking a full survey of the whole position, and bearing in mind the new duties we have to impose, not merely for this year, but also for next year, I think he would have come to the conclusion, very reluctantly, exactly as I have, that at any rate this is not the year to take a penny or two pence off the Tea Duty.

I was told by those in the trade and by those who knew that it would not answer the purpose to take a further penny off the Tea Duty. If you take off anything at all you must take off 2d. Otherwise you would not at this stage bring it home to the people whom you seek to benefit. Would anyone with any sense of responsibility advise me this year, when I want £16,000,000, when next year I shall want over £20,000,000, and when I want that money partly for the purpose of raising old age pensions, to throw away £2,250,000 by reducing the Tea Duty? I do not think I should be justified in doing that. I think I should be subjected to legitimate criticism. I quite understand that hon. Members who have protested year after year against the Tea Duty cannot very well allow a single year to pass without making their protest. I am not criticising; it is a protest which I hope will eventually be effective. I say that with all sincerity. There is nothing which has been said against the Tea Duty with which I do not agree heart and soul. It is a tax upon the poorest of the poor, upon people who can least afford it, and I still say that anyone who reads the Report of the pensions officers as to the conditions of the poor will agree there is no tax which hits the poor harder than this Tea Duty. I think it will be incumbent upon some future Chancellor of the Exchequer, when he is able to put the finances of the country in a better position than they are at the present time, to consider the question of reducing the Tea Duty amongst the very first, but at the present moment I do not (think anyone would consider me justified in my position in facing the problem of taking 2d. at least off the duty. Under these conditions, I hope the House of Commons will really think that we are justified, at any rate in the present year, in standing by the Tea Duty as it is.

The right hon. Gentleman has just told us that it would not make the remotest difference to the poor in this country if he took a 1d. in the pound off the Tea Duty. I think I may remind the House that at the last General Election it was frequently put forward all over the country on every possible occasion, and on the walls of all our towns, that a quarter of a farthing on a 4lb. loaf was going to starve the people of this country. Those are the facts. Will the Chancellor of the Exchequer get up and say they are not. Yet on tea, a prime necessity of life, according to the Prime Minister, and according I think to the Chancellor of the Exchequer, a penny in the pound does not make any difference, because it does not suit the Radical party that it should make any difference. I really think that is a fair criticism, and that I have not exaggerated. The odd thing about it all is that since the Government, came in there has been nothing extra big about the loaf except the price. An hon. Member made a very good speech, I think. He gave us a Labour-Socialist view of the Tea Duty, which I think was very good for the present Chancellor of the Exchequer. I have far more respect for the policy of the Member for Blackburn than for that of anybody sitting on the Front Government Bench. After all, the hon. Member for Blackburn and his friends have got what they believe is a remedy, whereas the right hon. Gentleman and his colleagues have no remedy for the misery and want of employment in this country. What did the President of the Board of Trade say the other day? He did not say much about the Tea Duty, I admit, but he did say "that there were millions of people in this country more miserable than the people of any other country in the world," and not only that, but he added "that they lived under conditions worse than barbarism." He forgot to explain that that was after 60 years of all the so-called benefits of Free Trade. After all the Tea Duty is a part of that show. What is the reason why that Tea Duty is so high? It is because the Liberal Free Traders will not let an import tax be put either on competing manufactured goods or even on the luxuries of the rich. I am afraid that the Chancellor of the Exchequer does not know his way about on this Tariff question. He is in a dreadful hole, although in reality he is a Tariff Reformer, as shown by his Patents Bill; he is tied down by this Free Trade system, and cannot help himelf. He will be bound to put from 75 per cent. to 100 per cent. on tea.

10.0 P.M.

The Prime Minister said you may tax anything—for instance, tea—as much as you like so long as you cannot produce it in this country. That is the essence of Free Trade. It comes to this: you can tax anything, no matter whether it is ever so much a necessary or raw material—you may tax whatever you like so long as it cannot do any single man or woman in this country a blooming halfpenny worth of good—so long as it cannot do anybody one little bit of good at all. That is what it comes to. If I am wrong perhaps somebody on the Treasury Bench will get up and correct me. That is why your tea, beer, and tobacco are so heavily taxed; that is why the working classes of this country are more heavily taxed by means of import duties on their food, drink, and tobacco than any other country in the world.

Land is the raw material of the food, drink and clothing of the people. I should like to point this out to the House now that I am on my legs. Reference has been made of the taxes in America. I want to point out the difference between import taxation in this country and in America. In America they raise £45,000,000 every year by the taxation of the imported luxuries of the rich, but in this country the whole of our import taxation is put upon the food, drink, and tobacco of the people of this country, and it is very well known that the working classes pay very nearly the whole of it. This system, which professes to confer such an enormous benefit on the working classes of this country, is really impossible for Free Traders to defend. The working classes, when they find out the meaning of this Budget, will no doubt have something to say in regard to it There is a very heavy taxation on tea, and nothing is taken off under this Budget, and the extra taxation on beer, whisky, and tobacco is between £6,000,000 and £8,000,000, if not a great deal more. This taxation also will be chiefly paid by the working classes of this country, and they will not be helped in the least by this Budget. A large extra taxation is put upon tobacco used by the poor, but the tobacco of the rich is not taxed in the same proportion, and this is what this democratic Government has done. The wealthy are not hit anything like so hardly as the working man. Then the Government tax the working man's beer, and now tell us that the producer will pay the tax, although I always thought that hon. Members opposite said that the consumers paid the taxes. Meantime foreign beer is allowed to come in, and here again the working man's beer is taxed much more heavily than the alcoholic drinks of the rich, and this is the democratic Budget of a democratic Government. One of the Government Whips recently said:—

"Tea was a necessary article for the working classes, and the tax pressed unduly on them, and it was a great burden on the agricultural labourers."
The hon. Member (Mr. Soares) in 1905 moved to reduce the Tea Duty to what my hon. Friend wants to reduce it to now, and this is what he said—I have no doubt he will come into the Lobby with us:—
"If there was one tax he objected to more than any other it was the Tea Duty. They had long been anxious for a free breakfast table. He was driven to the conclusion that the Tea Tax was not defensible and that it affected the rich even less than the poor, and in his own constituency a large number of people lived very largely on tea and bread and butter. The Tea Tax was a very heavy burden."
The Postmaster-General said very much the same thing. I remember, as a boy of 12 years old, seeing on all the walls and houses placards with "Vote for the Liberals and a free breakfast table" in large letters. I do not think we are very much nearer to it than we were then. One hundred and sixty Members opposite voted for this very Resolution in 1905, and if they have any real conscience outside their political conscience they will vote for it now.

There is at least one aspect of the case which deserves a little comment. I do not propose to follow the Chancellor of the Exchequer into the argument as to whether he or the hon. Gentleman near me possesses the copyright of this Budget. I cannot say truthfully that hon. Gentlemen opposite have been remarkable during the existence of this Parliament for the consistency which they have displayed in their political opinions. In a few moments we are going to divide, and hon. Gentlemen opposite are going into the Lobby to vote for a tax upon an article of food which is of universal consumption, and of which the whole available supply is to be taxed, and in a few weeks, on a thousand platforms up and down the country, hon. Gentlemen are going to stand and cast their eyes up to heaven, and thank heaven, that they are not as the food taxers. After all, even the wildest food taxer who ever existed in the wildest flight of fancy of any hon. Member on the Government Bench never proposed that a weight of taxation of this size should be placed upon the whole available supply for consumption of an article of food in this country. The position of hon. Gentlemen opposite is not remarkable either for the logic or for its consistency, but when you go into the actual figures on which it is based its mathematics are certainly not less remarkable than its logic. Hon. Gentlemen say they are going to vote for a tax on tea, and if any of us propose to reduce the tax on tea and substitute a tax on foreign corn we shall be placing an intolerable burden upon the people of this country. I do not say they intend wilfully to misrepresent the tax, but I think they are labouring under an essential error in regard to matters of fact in relation to this question. Let us consider the Tea Tax as a food tax, and let us suppose that there is a tax of 2s. per quarter on corn. See which tax presses most hardly. I have gone through the Board of Trade returns for past years in order to find out the consumption per head of corn and wheat, and also of tea. I find the consumption of wheat per head of the population was 6 bushels, of which 2.7 were British and 3.3 were foreign. It is not quite so easy to find out what the consumption per head was in the case of tea. There ought to have been a report in regard to tea and coffee published this year. It has been in preparation for some time, and it is most unfortunate that it is not available for use at the present moment. I hope the right hon. Gentleman will make representation with the view of having the report made available before the Report stage of the Bill. If you make the calculation on the basis of previous Returns, you find that the consumption of tea per head of the population was 6.2 pounds, which is very nearly what it was when the last return was made in 1904. It was then 6.3. Of the 6.2 pounds 5.6 were British, and only 6 were foreign. How do we stand with regard to the duties? For the sake of my argument I shall suppose that the duty on wheat is 2s. per quarter. Supposing that duty fell on all corn, and not merely on foreign corn, the duty payable on the consumption per head is 1s. 6d., while in the case of the 6.2 pounds of tea the duty payable is 2s. 7d. It may be said that it is not fair to take total quantities in that way. I agree that, if anything, by reckoning in that way it is harder on the working classes, for I think tea is more largely consumed by the working classes than by other classes. There is a further side to the question. There was a report specially dealing with working class Budgets, and the means of sustenance of the working classes published last year. I have referred to that Report for further light on this subject. It is Paper 3,864 of 1908, and at page 25 of that Paper you will find the figures I am going to quote. A family is taken for the purpose of these statistics as 5.6 persons—father, mother, and 3.6 children, which is the average number of children in the calculation. The expenditure of that family on tea is 58s. 6d. a year for 31.2lb. of tea, and for bread and flour they spend 186s. 4d. The quantity of bread and flour, it is estimated, may be represented fairly by about 30 bushels. Thirty bushels are not the actual figures in this report; the figures are 520lb. of flour and 1,144lb. of bread. I am assuming in favour of the right hon. Gentleman that all the flour is the best wheaten flour, and that all the bread is made from home wheat. Assume that all the duty of 2s. falls on the wheat, the family pay on their consumption of bread and flour a duty of 7s. 6d. a year. For 34 bushels they would pay in duty 8s. 6d., while they pay on, their consumption of tea a duty of 13s. a year. The duty on flour is 4 per cent. on the amount spent, and the duty on tea is no less than 22 per cent. And this is the poor man's Budget! We used to-be told when you make tea the proper thing was to put in a spoonful for each person and one spoonful for the pot. Now we are asked to put in five spoonfuls for the pot and two for the Chancellor of the Exchequer. Consider, then, the position of the British working man. Having taxed the land on which his house is built, the bricks of which it is built, and the slates on the roof, but not the window sashes—you do not tax those: they come from Norway—having taxed the coal on the hearth, the sugar on the table, and the tobacco in the jar, you now propose to tax the tea in the pot. And this Budget is gentle to the poor! The Chancellor says, "Why cannot we get the duty off?" I will tell him: It is because he insists on refraining from taxing the foreigner as he ought to be taxed.

The Chancellor of the Exchequer expressed a doubt, which I do not share, whether the approval or the disapproval of the hon. Member for Blackburn (Mr. Snowden) would be more fatal to his Budget, and when I heard some hon. Gentlemen above the Gangway expressing agreement with the hon. Member for Blackburn, I could not help thinking that opposition, like misery, acquaints a man with strange bedfellows. The hon. Member for Blackburn throughout his speech urged in an absolutely unreserved fashion that no tax that affected those whom he pretends specially to represent should be imposed. For my part I have no doubt whatever that the approval of the hon. Gentleman would be far more fatal to these proposals than his disapproval, and in that respect, at any rate, I differ entirely from the opinion expressed by the Chancellor of the Exchequer. No doubt there is an extremely strong case for removing the tax upon tea on the ground set forth with such force, that it is almost a necessity of the poorest classes, and I maintain that it is just as much a necessity of the poorer classes in this country as in Ireland. I cannot understand in the least the distinction hon. Gentlemen endeavour to draw in that respect; I believe tea to be a necessity also of the poor in this country. But that does not cover the ground. The question is that when a certain amount of revenue is to be got is the Chancellor of the Exchequer to effect a reduction of this tax? I turn again to the speech of the hon. Member for Blackburn, a speech which seemed to be crammed full of every possible fallacy. He of all hon. Members in this House objected to the Chancellor of the Exchequer's proposal in this behalf. Why, if there is any hon. Member in this House who rushes to the Treasury Bench to urge that old age pensions should be given to the wives of foreigners and to every possible disqualified person, regardless of expenditure, it is the hon. Member for Blackburn; but the moment the question arises of paying for old age pensions it is he who comes here and makes a speech which no doubt will go down in certain quarters, but which seems to me, coming from the hon. Member, to be absolutely the most inexcusable thing that possibly could be presented to this House. The hon. Member has a talent for laying before the House, as if it were some great fiscal discovery, some absolute commonplace of taxation. He said this tax affects working men. So it does. I deeply regret it. Then he went on to compare the working man with a duke—the bogey-man, of course, came in.

Then the hon. Member objected to the Chancellor of the Exchequer's statement that the tax was placed on the broadest back. Does the hon. Member deny that the aggregate of the small men of this country is far greater than the aggregate of the few richer men? It is the broadest back; and I believe that the real working man who is a worker and not a shirker will not thank the hon. Member for this kind of advocacy. The working man is ready, I believe, to pay his share of taxation, to pay for social reform. I decline to accept the hon. Member's estimate of the working man, who, I believe, is certainly willing to pay for old age pensions, and I think willing and proud to pay his share for "Dreadnoughts" and the proper defence of his native country. There is another ground on which I believe that tea, more than most other things, is entitled to the most favourable consideration of this House, namely, that it is for the most part the product of British labour, coming from British Colonies and possessions, and grown with British capital. It cornea from India and Ceylon, and there are no more estimable men than the planters who produce this particular article of food. The hon. Member for Yarmouth suggested that we should tax champagnes.

Take them altogether, what would they produce in the way of revenue? Something really trifling.

I think the hon. Gentleman-says he would not put any more taxation on foreign wines. I would only ask him whether he supposes that if more taxation were imposed on foreign wines people would not drink it in this country? Oh, no.

I do not know what tax would be sufficient to deprive the hon. Gentleman of his glass of wine. I for one would not vote for taxation to that extent. The suggestion of the hon. Member for Yarmouth was not a practical one, because no amount of taxation that could be imposed on wines could produce anything that would represent the amount that is gathered by the sums collected from almost everybody in the country, as they all drink tea. I think that criticism falls to the ground. The hon. Member for Blackburn, said that wages were on the decrease. So far as a certain number of recent returns go that would appear to be so, but if you take the wages for a period of years, which is the only manner in which a serious politician would take them, they do not bear out the statement that wages have been on the decrease, while prices have been on the increase, and that, therefore, the condition of the masses was on the decline.

The Chancellor of the Exchequer made another statement to which I wish to subscribe. It really is the fact, and I think it is admitted by all who are in contact with the tea industry, that a penny off does not produce much relief to the drinkers, that the amount is so small that it disappears among the middlemen, or they do not think it worth while to pass it on. I do hope that the Chancellor, who has not been able to take a penny off this year, will take twopence off next year, and that he will have that well under his consideration, and endeavour to so frame his Budget that he will be able to make an appreciable reduction on what I freely admit is a heavily taxed industry. I cannot, however, say that I am strongly in favour of pressing for the reduction of the tax this year for many reasons I do not trouble the House with. Amongst those interested in tea there will be no disappointment this year at no reduction, though that they would have earnestly desired a reduction I do not dispute. Everybody in this country who cares anything about this country knows that in the last three or four years our naval preparations have been allowed to fall badly behind those of foreign countries. [HON. MEMBERS: "Question."] I believe on that account quite as much as on account of what is included in very comprehensive social reform that there will be a willingness on the part of all classes in this country, including the real true working man,

Division No. 717.]

AYES.

[10.40 p.m.

Agnew, George WilliamCrosfield, A. H.Henderson, Arthur (Durham)
Alden, PercyCross, AlexanderHenderson, J. McD. (Aberdeen, W.)
Allen, A. Acland (Christchurch)Dalziel, Sir James HenryHenry, Charles S.
Allen, Charles P. (Stroud)Davies, Ellis William (Eifion)Herbert, Col. Sir Ivor (Mon, S.)
Ashton, Thomas GairDavies, Timothy (Fulham)Higham, John Sharp
Asquith, Rt. Hon. Herbert HenryDavies, Sir W. Howell (Bristol, S.)Hobhouse, Rt. Hon. Charles E. H.
Balfour, Robert (Lanark)Dewar, Sir J. A. (Inverness-sh.)Hodge, John
Baring, Godfrey (Isle of Wight)Dobson, Thomas W.Holt, Richard Durning
Barker, Sir JohnDuncan, C. (Barrow-in-Furness)Hooper, A. G.
Barlow, Sir John E. (Somerset)Duncan, J. Hastings (York, Otley)Horniman, Emslie John
Barnard, E. B.Dunn, A. Edward (Camborne)Isaacs, Rufus Daniel
Barnes, G. N.Edwards, Sir Francis (Radnor)Jenkins, J.
Barran, Sir John NicholsonElibank, Master ofJones, Leif (Appleby)
Barry, Redmond J. (Tyrone, N.)Erskine, David C.Jones, William (Carnarvonshire)
Bell, RichardEssex, R. W.Kelley, George D.
Bennett, E. N.Evans, Sir S. T.King, Alfred John (Knutsford)
Berridge, T. H. D.Everett, R. LaceyLaidlaw, Robert
Boulton, A. C. F.Falconer, J.Lamb, Edmund G. (Leominster)
Bowerman, C. W.Ferguson, R. C. MunroLamb, Ernest H. (Rochester)
Brigg, JohnFindlay, AlexanderLamont, Norman
Bright, J. A.Fuller, John Michael F.Layland-Barratt, Sir Francis
Burns, Rt. Hon. JohnFullerton, HughLever, A. Levy (Essex, Harwich)
Burt, Rt. Hon. ThomasGibb, James (Harrow)Levy, Sir Maurice
Buxton, Rt. Hon. Sydney CharlesGibson, J. P.Lewis, John Herbert
Carr-Gomm, H. W.Gill, A. H.Lloyd-George, Rt. Hon. David
Causton, Rt. Hon. Richard KnightGlendinning, R. G.Lupton, Arnold
Chance, Frederick WilliamGlover, ThomasMacdonald, J. M. (Falkirk Burghs)
Channing, Sir Francis AllstonGrey, Rt. Hon. Sir EdwardMackarness, Frederic C.
Clough, WilliamGuest, Hon. Ivor ChurchillMaclean, Donald
Cobbold, Felix ThornleyGulland, John W.M'Callum, John M.
Collins, Stephen (Lambeth)Harcourt, Rt. Hon. L. (Rossendale)McKenna, Rt. Hon. Reginald
Collins, Sir Wm. J. (St. Pancras, W.)Harcourt, Robert V. (Montrose)M'Laren, H. D. (Stafford, W.)
Cooper, G. J.Harmsworth, Cecil B. (Worcester)M'Micking, Major G.
Corbett, A. Cameron (Glasgow)Harmsworth, R. L. (Caithness-shire)Mallet, Charles E.
Corbett, C. H. (Sussex, E. Grinstead)Harwood, GeorgeMarkham, Arthur Basil
Cornwall, Sir Edwin A.Haworth, Arthur A.Marnham, F. J.
Cory, Sir Clifford JohnHedges, A. PagetMassie, J.
Cowan, W. H.Helme, Norval WatsonMasterman, C. F. G.

who, I think sometimes is not very favourably represented in this House, to pay his share. I say we are all representatives of the working men. I think they will be able to bear their share of this taxation to-day. The hon. Member spoke of the high level of taxation. The tax on tea is excessive. I am sure I think so. It is not fair to talk of it as if it was a new tax Taxation upon tea has for many years, through the lives of many Ministries, been exceedingly high. I do not say it is a good thing. I wish it was lowered, but it is absurd to come in now and say it is so, as if there was an urgent necessity in this year, of all others, to effect a reduction. For those reasons, though I most earnestly hope the Chancellor will take not a penny but twopence off next year I will not, even though I was vice-president of the Anti Tea Duty League, support the Amendment for the reduction this year.

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

Question put, "That the Question be now put."

The Committee divided: Ayes, 189; Noes, 91.

Menzies, Sir WalterRoberts, Charles H. (Lincoln)Tomkinson, James
Middlebrook, WilliamRobertson, Sir G. Scott (Bradford)Toulmin, George
Molteno, Percy AlportRobertson, J. M. (Tyneside)Trevelyan, Charles Philips
Montagu, Hon. E. S.Robinson, S.Verney, F. W.
Worrell, PhilipRobson, Sir William SnowdonWadsworth, J.
Murray, Capt. Hon. A. C. (Kincard.)Roch, Walter F. (Pembroke)Walker, H. de R. (Leicester)
Myer, HoratioRoe, Sir ThomasWalsh, Stephen
Newnes, F. (Notts, Bassetlaw)Rogers, F. E. NewmanWaring, Waiter
Norman, Sir HenryRose, Sir Charles DayWarner, Thomas Courtenay T.
Norton, Captain Cecil WilliamRussell, Rt. Hon. T. W.Wason, Rt. Hon. E. (Clackmannan)
Nussey, Sir WillansRutherford, V. H. (Brentford)Wason, John Cathcart (Orkney)
Nuttall, HarrySamuel, Rt. Hon. H. L. (Cleveland)Watt, Henry A.
O'Donnell, C. J. (Walworth)Samuel, S. M. (Whitechapel)White, Sir George (Norfolk)
Parker, James (Halifax)Scarisbrick, Sir T. T. L.White, J. Dundas (Dumbartonshire)
Partington, OswaldSchwann, Sir C. E. (Manchester)White, Sir Luke (York, E. R.)
Paulton, James MellorSeely, ColonelWhittaker, Rt. Hon. Sir Thomas P.
Pearce, Robert (Staffs, Leek)Shaw, Sir Charles E. (Stafford)Wilkie, Alexander
Pirie, Duncan V.Sherwell, Arthur JamesWilliams, J. (Glamorgan)
Pointer, J.Snowden, P.Williams, W. Llewelyn (Carmarthen)
Pollard, Dr. G. H.Stanley, Hon. A. Lyulph (Cheshire)Williamson, Sir A.
Ponsonby, Arthur A. W. H.Stewart-Smith, D. (Kendal)Wilson, Hon. G. G. (Hull, W.)
Priestley, Arthur (Grantham)Summerbell, T.Wilson, W. T. (Westhoughton)
Rainy, A. RollandTaylor, John W. (Durham)Wood, T. M'Kinnon
Rea, Rt. Hon. Russell (Gloucester)Thomas, Sir A. (Glamorgan, E.)
Rees, J. D.Thorne, G. R. (Wolverhampton)TELLERS FOR THE AYES.—Mr. Joseph Pease and Sir E. Strachey.
Richards, T. F. (Wolverhampton, W.)Thorne, William (West Ham)

NOES.

Anson, Sir William ReynellForster, Henry WilliamNewdegate, F. A.
Balcarres, LordFoster, P. S.Nicholson, Wm. G. (Petersfield)
Banbury, Sir Frederick GeorgeGardner, ErnestPease, Herbert Pike (Darlington)
Banner, John S. Harmood-Goulding, Edward AlfredPeel, Hon. W. R. W.
Baring, Capt. Hon. G. (Winchester)Gretton, JohnPowell, Sir Francis Sharp
Beckett, Hon. GervaseGuinness, Hon. R. (Haggerston)Ratcliff, Major R. F.
Belloc, Hilaire Joseph Peter R.Haddock, George B.Renton, Leslie
Brotherton, Edward AllenHamilton, Marquess ofRenwick, George
Bull, Sir William JamesHarris, Frederick LevertonRoberts, S. (Sheffield, Ecclesall)
Burdett-Coutts, W.Harrison-Broadley, H. B.Ronaldshay, Earl of
Butcher, Samuel HenryHermon-Hodge, Sir RobertRutherford, John (Lancashire)
Campbell, Rt. Hon. J. H. M.Hill, Sir ClementRutherford, Watson (Liverpool)
Carlile, E. HildredHills, J. W.Salter, Arthur Clavell
Carson, Rt. Hon. Sir Edward H.Hope, James Fitzalan (Sheffield)Smith, Abel H. (Hertford, E.)
Cecil, Evelyn (Aston Manor)Hunt, RowlandStanier, Beville
Cecil, Lord John P. Joicey-Joynson-Hicks, WilliamStanley, Hon. Arthur (Ormskirk)
Chamberlain, Rt. Hon. J. A. (Worc'r.)Kennaway, Rt. Hon. Sir John H.Starkey, John R.
Chaplin, Rt. Hon. HenryKeswick, WilliamStaveley-Hill, Henry (Staffordshire)
Clive, Percy ArcherKimber, Sir HenryTalbot, Rt. Hon. J. G. (Oxford Univ.)
Clyde, J. AvonKing, Sir Henry Seymour (Hull)Thomson, W. Mitchell- (Lanark)
Coates, Major E. F. (Lewisham)Lambton, Hon. Frederick WilliamTuke, Sir John Batty
Corbett, T. L. (Down, North)Law, Andrew Bonar (Dulwich)Walker, Col. W. H. (Lancashire)
Courthope, G. LoydLee, Arthur H. (Hants, Fareham)Warde, Col. C. E. (Kent, Mid)
Craig, Captain James (Down, E.)Lockwood, Rt. Hon. Lt.-Col. A. R.Williams, Col. R. (Dorset, W.)
Craik, Sir HenryLong, Col. Charles W. (Evesham)Willoughby de Eresby, Lord
Dickson, Rt. Hon. C. ScottLong, Rt. Hon. Walter (Dublin, S.)Wilson, A. Stanley (York, E. R.)
Douglas, Rt. Hon. A. Akers-MacCaw, Wm. J. MacGeaghWortley, Rt. Hon. C. B. Stuart-
Duncan Robert (Lanark Govan)M'Arthur, CharlesYounger, George
Faber, George Denison (York)Mason, James F. (Windsor)
Faber, Captain W. V. (Hants, W.)Morpeth, ViscountTELLERS FOR THE NOES.—Sir A. Acland-Hood and Viscount Valentia.
Fell, ArthurMorrison-Bell, Captain
Fletcher, J. S.

Question put accordingly. The Committee divided: Ayes, 170; Noes, 177.

Division No. 718.]

AYES.

[10.50 p.m.

Agnew, George WilliamBarry, Redmond J. (Tyrone, N.)Chance, Frederick William
Alden, PercyBell, RichardChanning, Sir Francis Allston
Allen, A. Acland (Christchurch)Bennett, E. N.Clough, William
Allen, Charles P. (Stroud)Berridge, T. H. D.Collins, Stephen (Lambeth)
Ashton, Thomas GairBoulton, A. C. F.Collins, Sir Wm. J. (St. Pancras, W.)
Asquith, Rt. Hon. Herbert HenryBowerman, C. W.Corbett, A. Cameron (Glasgow)
Balfour, Robert (Lanark)Brigg, JohnCorbett, C. H. (Sussex, E. Grinstead)
Banbury, Sir Frederick GeorgeBright, J. A.Cornwall, Sir Edwin A.
Baring, Godfrey (Isle of Wight)Burns, Rt. Hon. JohnCory, Sir Clifford John
Barker, Sir JohnBurt, Rt. Hon. ThomasCowan, W. H.
Barlow, Sir John E. (Somerset)Buxton, Rt. Hon. Sydney CharlesCrosfield, A. K.
Barnard, E. B.Carr-Gomm, H. W.Cross, Alexander
Barran, Sir John NicholsonCauston, Rt. Hon. Richard KnightDalziel, Sir James Henry

Davies, Ellis Wiliam (Eifion)King, Alfred John (Knutsford)Roberts, Charles H. (Lincoln)
Davies, Timothy (Fulham)Laidlaw, RobertRobertson, Sir G. Scott (Bradford)
Davies, Sir W. Howell (Bristol, S.)Lamb, Edmund G. (Leominster)Robertson, J. M. (Tyneside)
Dewar, Sir J. A. (Inverness-sh.)Lamont, NormanRobinson, S.
Dobson, Thomas W.Layland-Barratt, Sir FrancisRobson, Sir William Snowdon
Duncan, J. Hastings (York, Otley)Lever, A. Levy (Essex, Harwich)Roe, Sir Thomas
Dunn, A. Edward (Camborne)Levy, Sir MauriceRogers, F. E. Newman
Edwards, Sir Francis (Radnor)Lewis, John HerbertRose, Sir Charles Day
Eubank, Master ofLloyd-George, Rt. Hon. DavidRussell, Rt. Hon. T. W.
Erskine, David C.Lupton, ArnoldRutherford, V. H. (Brentford)
Essex, R. W.Macdonald, J. M. (Falkirk, Burghs)Samuel, Rt. Hon. H. L. (Cleveland)
Evans, Sir S. T.Mackarness, Frederic C.Samuel, S. M. (Whitechapel)
Everett, R. LaceyMaclean, DonaldScarisbrick, Sir T. T. L.
Falconer, J.M'Callum, John M.Schwann, Sir C. E. (Manchester)
Ferguson, R. C. MunroMcKenna, Rt. Hon. ReginaldSeely, Colonel
Findlay, AlexanderM'Laren, H. D. (Stafford, W.)Shaw, Sir Charles E. (Stafford)
Fuller, John Michael F.M'Micking, Major G.Sherwell, Arthur James
Gibb, James (Harrow)Mallet, Charles E.Stanley, Hon. A. Lyulph (Cheshire)
Gibson, J. P.Marnham, F. J.Stewart-Smith, D. (Kendal)
Glendinning, R. G.Massie, J.Thomas, Sir A. (Glamorgan, E.)
Grey, Rt. Hon. Sir EdwardMasterman, C. F. G.Thorne, G. R. (Wolverhampton)
Guest, Hon. Ivor ChurchillMenzies, Sir WalterTomkinson, James
Gulland, John W.Middlebrook, WilliamToulmin, George
Haldane, Rt. Hon. Richard B.Molteno, Percy AlportTrevelyan, Charles Philips
Harcourt, Rt. Hon. L. (Rossendale)Montagu, Hon. E. S.Verney, F. W.
Harcourt, Robert V. (Montrose)Morrell, PhilipWadsworth, J.
Harmsworth, Cecil B. (Worcester)Murray, Capt. Hon. A. C. (Kincard.)Walker, H. de R. (Leicester)
Harmsworth, R. L. (Caithness-shire)Myer, HoratioWaring, Walter
Harwood, GeorgeNewnes, F. (Notts, Bassetlaw)Warner, Thomas Courtenay T.
Haworth, Arthur A.Norman, Sir HenryWason, Rt. Hon. E. (Clackmannan)
Hedges, A. PagetNorton, Captain Cecil WilliamWason, John Cathcart (Orkney)
Helme, Norval WatsonNussey, Sir WillansWatt, Henry A.
Henderson, J. McD. (Aberdeen, W.)Nuttall, HarryWhite, Sir George (Norfolk)
Henry, Charles S.O'Donnell, C. J. (Walworth)White, J. Dundas (Dumbartonshire)
Herbert, Col. Sir Ivor (Mon. S.)Partington, OswaldWhite, Sir Luke (York, E. R.)
Higham, John SharpPaulton, James MellorWhittaker, Rt. Hon. Sir Thomas P.
Hobhouse, Rt. Hon. Charles E. H.Pearce, Robert (Staffs, Leek)Wilkie, Alexander
Hodge, JohnPirie, Duncan V.Williams, W. Llewelyn (Carmarthen)
Holt, Richard DurningPollard, Dr. G. H.Williamson, Sir A.
Hooper, A. G.Ponsonby, Arthur A. W. H.Wilson, Hon. G. G. (Hull, W.)
Isaacs, Rufus DanielPriestley, Arthur (Grantham)Wood, T. M'Kinnon
Jenkins, J.Rainy, A. Rolland
Jones, Leif (Appleby)Rea, Rt. Hon. Russell (Gloucester)TELLERS FOR THE AYES.—Mr. Joseph Pease and Sir E. Strachey.
Jones, William (Carnarvonshire)Rees, J. D.
Kelley, George D.Ridsdale, E. A.

NOES.

Acland-Hood, Rt. Hon. Sir Alex. F.Foster, P. S.M'Arthur, Charles
Ambrose, RobertGardner, ErnestM'Kean, John
Arkwright, John StanhopeGlover, ThomasMeagher, Michael
Balcarres, LordGoulding, Edward AlfredMooney, J. J.
Banner, John S. Harmood-Gretton, JohnMorrison-Bell, Captain
Baring, Capt. Hon. G. (Winchester)Guinness, Hon. R. (Haggerston)Muldoon, John
Beckett, Hon. GervaseGwynn, Stephen LuciusMurphy, John (Kerry, E.)
Brotherton, Edward AllenHamilton, Marquess ofNannetti, Joseph P.
Bull, Sir William JamesHarris, Frederick LevertonNewdegate, F. A.
Burdett Coutts, W.Harrison-Broadley, H. B.Nicholson, Wm. G. (Petersfield)
Campbell, Rt. Hon. J. H. M.Hazleton, RichardNolan, Joseph
Carlile, E. HildredHealy, Timothy MichaelO'Connor, John (Kildare, N.)
Carson, Rt. Hon. Sir Edward H.Hill, Sir ClementO'Connor, T. P. (Liverpool)
Cecil, Evelyn (Aston Manor)Hills, J. W.Pease, Herbert Pike (Darlington)
Cecil, Lord John P. Joicey-Hope, James Fitzalan (Sheffield)Peel, Hon. W. R. W.
Chaplin, Rt. Hon. HenryHunt, RowlandPointer, J.
Clancy, John JosephJoyce, MichaelPowell, Sir Francis Sharp
Clive, Percy ArcherJoynson-Hicks, WilliamPower, Patrick Joseph
Clyde, J. AvonKeating, M.Ratcliff, Major R. F.
Coates, Major E. F. (Lewisham)Kennaway, Rt. Hon. Sir John H.Reddy, M.
Cochrane, Hon. Thomas H. A. E.Keswick, WilliamRenton, Leslie
Condon, Thomas JosephKilbride, DenisRenwick, George
Corbett, T. L. (Down, North)Kimber, Sir HenryRoberts, S. (Sheffield, Ecclesall)
Courthope, G. LoydKing, Sir Henry Seymour (Hull)Ronaldshay, Earl of
Craig, Captain James (Down, E.)Law, Andrew Bonar (Dulwich)Rutherford, John (Lancashire)
Cullinan, J.Lee, Arthur H. (Hants, Fareham)Rutherford, Watson (Liverpool)
Devlin, JosephLockwood, Rt. Hon. Lt.-Col. A. R.Salter, Arthur Clavell
Dickson, Rt. Hon. C. ScottLong, Col. Charles W. (Evesham)Sheehy, David
Douglas, Rt. Hon. A. Akers-Lowe, Sir Francis WilliamSmith, Abel H. (Hertford, E.)
Duffy, William J.Lundon, T.Stanier, Beville
Duncan, Robert (Lanark, Govan)Lynch, A. (Clare, W.)Stanley, Hon. Arthur (Ormskirk)
Faber, Capt. W. V. (Hants, W.)MacCaw, Wm. J. MacGeaghStarkey, John R.
Fell, ArthurMacNeill, John Gordon SwiftStaveley-Hill, Henry (Staffordshire)
Fletcher, J. S.MacVeagh, Jeremiah (Down, S.)Thomson, W. Mitchell- (Lanark)
Forster, Henry WilliamMacVeigh, Charles (Donegal, E.)Thorne, William (West Ham)

Tuke, Sir John BattyWhite, Patrick (Meath, North)Wilson, W. T. (Westhoughton)
Valentia, ViscountWilliams, J. (Glamorgan)Younger, George
Walker, Col. W. H. (Lancashire)Williams, Col. R. (Dorset, W.)
Walsh, StephenWilloughby de Eresby, LordTELLERS FOR THE NOES.—Mr. Patrick O'Brien and Mr. Boland.
Warde, Col. C. E. (Kent, Mid)Wilson, A. Stanley (York, E. R.)

moved to add at the end of the Clause the words "except in the case of tea grown in a part of the British Empire, which shall pay a tax on four-pence."

I have had the pleasure of moving this Amendment on two previous occasions, and the last time but one the Prime Minister, in answer to my remarks, said that the amount of tea which came from foreign counries was so small in comparison with the proportion that came from portions of the British Empire that he considered it was a negligible quantity. That was two years ago. I will now quote the figures for the last three years, which I have obtained from the President of the Board of Trade. The amount of tea which came from parts of the British Empire, from British India, and Ceylon in 1906 was 289,000,000 lbs., but last year it was reduced to 281,000,000 lbs., or a reduction of 8,000,000 lbs. in three years. Tea, on the other hand, which came in from China in 1906 was 13,000,000 pounds. In 1908 it had risen to 22,000,000 pounds, showing an increase of 9,000,000 pounds as against a reduction in the tea grown in our Empire of 8,000,000 pounds. I do not take any credit to myself for saying two years ago that it was probable, unless some Resolution, such as I was then proposing was carried, the imports of Chinese tea would increase. Any judge who had seen what was going on in tea drinking, at any rate among the upper classes, would have considered that would have been the effect. This Committee, however, is so out of touch with the sympathy which we would show towards the Colonies of the Empire and so out of touch with the opinion of the country at the present time, that it is useless to urge anything in favour of Colonial preference here, but, I have put this Amendment down and shall, of course, carry it to a Division, so that we may see in black and white those who are in favour of giving our friends in the Colonies a slight preference over those in other countries. This assembly is so out of sympathy with it that it is quite useless advocating this subject here, but we will advocate it soon in the country, and there we shall have a very different answer.

This is another hardy annual. It was moved in the late Parliament. I am not sure it was not the late Mr. Lowther who moved it, but I do not think he got much support from his own side.

I think the hon. Member was about the only one. I think I voted for it, but it was on the general soundness of opposing everything which came from His Majesty's Government. I can only use the same argument that I used with regard to the other Amendment. Even if it was desirable to discriminate between these two classes of tea, it would be quite impossible to do it this year.

Is it a fact that there has been an increase in the tea from China of 9,000,000 lbs. within the last three years, whereas there has been a decrease of tea from our own possessions of 8,000,000 lbs.?

I heard the figures with some surprise. I knew there had been a change within the last few years, and that there has been a greater run on China tea, and, if the hon. Member tells me those are the figures, I am not in a position to challenge them. I shall be glad to look into the matter.

The figures are contained in an answer by the President of the Board of Trade.

I think the Chancellor of the Exchequer should be able to give us these figures, seeing that they are of an extremely serious nature. Whatever the opinion of the House may have been in past days it is different now. During the last year or two we have found that our Colonies have come forward and helped us in various ways in connection with the naval and military defence of the Empire. Here is an opportunity to make some return. This tea is grown by our fellow subjects. Surely if we can show, as we have shown, that there is a decrease of tea imports from our own Colonies and an increase from China, it is a serious matter which should engage the attention of the Chancellor of the Exchequer. We have a right to a more satisfactory answer from the right hon. Gentleman, who, at any rate, might give us the figures we have asked for.

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

Division No. 719.]

AYES.

[11.7 p.m.

Acland-Hood, Rt. Hon. Sir Alex. F.Fletcher, J. S.Newdegate, F. A.
Anson, Sir William ReynellForster, Henry WilliamNicholson Wm. G. (Petersfield)
Arkwright, John StanhopeFoster, P. S.Pease, Herbert Pike (Darlington)
Balcarres, LordGardner, ErnestPeel, Hon. W. R. W.
Banner, John S. Harmood-Gretton, JohnRatcliff, Major R. F.
Baring, Capt. Hon. G. (Winchester)Guinness, Hon. R. (Haggerston)Renton, Leslie
Beckett, Hon. GervaseHaddock, George B.Renwick, George
Brotherton, Edward AllenHamilton, Marquess ofRobert s, S. (Sheffield, Ecclesall)
Bull, Sir William JamesHarris, Frederick LevertonRonaldshay, Earl of
Burdett-Coutts, W.Harrison-Broadley, H. B.Rutherford, John (Lancashire)
Butcher, Samuel HenryHermon-Hodge, Sir RobertRutherford, Watson (Liverpool)
Campbell, Rt. Hon. J. H. M.Hill, Sir ClementSalter, Arthur Clavell
Carlile, E. HildredHills, J. W.Stanier, Beville
Carson, Rt. Hon. Sir Edward H.Hope, James Fitzalan (Sheffield)Stanley, Hon. Arthur (Ormskirk)
Cecil, Evelyn (Aston Manor)Hunt, RowlandStarkey, John R.
Chamberlain, Rt. Hon. J. A. (Worc'r.)Joynson-Hicks, WilliamStaveley Hill, Henry (Staffordshire)
Chaplin, Rt. Hon. HenryKennaway, Rt. Hon. Sir John H.Talbot, Rt. Hon. J. G. (Oxford Univ.)
Clive, Percy ArcherKeswick, WilliamThomson, W. Mitchell- (Lanark)
Clyde, J. AvonKimber, Sir HenryValentia, Viscount
Coates, Major E. F. (Lewisham)King, Sir Henry Seymour (Hull)Walker, Col. W. H. (Lancashire)
Cochrane, Hon. Thomas H. A. E.Lee, Arthur H. (Hants, Fareham)Warde, Col. C. E. (Kent, Mid)
Corbett, T. L. (Down, North)Lockwood, Rt. Hon. Lt.-Col. A. R.Williams, Col. R. (Dorset, W.)
Courthope, G. LoydLong, Col. Charles W. (Evesham)Wilson, A Stanley (York, E. R.)
Craig, Captain James (Down, E.)Long, Rt. Hon. Walter (Dublin, S.)Wortley, Rt. Hon. C. B. Stuart-
Craik, Sir HenryLowe, Sir Francis WilliamYounger, George
Dickson, Rt. Hon. C. ScottMacCaw, Wm. J. MacGeagh
Douglas, Rt. Hon. A. Akers-M'Arthur, Charles
Duncan, Robert (Lanark, Govan)Mason, James F. (Windsor)TELLERS FOR THE AYES.—Mr. Fell and Mr. Goulding.
Faber, George Denison (York)Morpeth, Viscount
Faber, Captain W. V. (Hants, W.)Morrison-Bell, Captain

NOES.

Abraham, W. (Cork, N. E.)Cory, Sir Clifford JohnHealy, Maurice (Cork)
Agnew, George WilliamCowan, W. H.Healy, Timothy Michael
Alden, PercyCrosfield, A. H.Hedges, A. Paget
Allen, A. Acland (Christchurch)Cullinan, J.Helme, Norval Watson
Allen, Charles P. (Stroud)Dalziel, Sir James HenryHenderson, Arthur (Durham)
Ambrose, RobertDavies, Ellis William (Eifion)Henderson, J. McD. (Aberdeen, W.)
Ashton, Thomas GairDavies, Timothy (Fulham)Henry, Charles S.
Asquith, Rt. Hon. Herbert HenryDavies, Sir W. Howell (Bristol, S.)Herbert, Col. Sir Ivor (Mon, S.)
Atherley-Jones, L.Devlin, JoesphHigham, John Sharp
Balfour, Robert (Lanark)Dewar, Sir J. A. (Inverness-sh.)Hobhouse, Rt. Hon. Charles E. H.
Banbury, Sir Frederick GeorgeDobson, Thomas W.Hodge, John
Baring, Godfrey (Isle of Wight)Duffy, William J.Holt, Richard Durning
Barker, Sir JohnDuncan, G. (Barrow-in-Furness)Hooper, A. G.
Barlow, Sir John E. (Somerset)Duncan, J. Hastings (York, Otley)Isaacs, Rufus Daniel
Barnard, E. B.Dunn, A. Edward (Camborne)Jenkins, J.
Barnes, G. N.Edwards, Sir Francis (Radnor)Jones, Leif (Appleby)
Barran, Sir John NicholsonElibank, Master ofJones, William (Carnarvonshire)
Barry, Redmond J. (Tyrone, N.)Erskine, David C.Keating, M.
Bell, RichardEssex, R. W.Kelley, George D.
Benn, W. (Tower Hamlets, St. Geo.)Evans, Sir S. T.Kilbride, Denis
Bennett, E. N.Everett, R. LaceyKing, Alfred John (Knutsford)
Berridge, T. H. D.Falconer, JamesLaidlaw, Robert
Boland, JohnFerguson, R. C. MunroLamb, Edmund G. (Leominster)
Boulton, A. C. F.Findlay, AlexanderLamb, Ernest H. (Rochester)
Bowerman, C. W.Fuller, John Michael F.Lament, Norman
Brigg, JohnFullerton, HughLayland-Barratt, Sir Francis
Bright, J. A.Gibb, James (Harrow)Lever, A. Levy (Essex, Harwich)
Burns, Rt. Hon. JohnGibson, J. P.Levy, Sir Maurice
Burt, Rt. Hon. ThomasGill, A. H.Lewis, John Herbert
Buxton, Rt. Hon. Sydney CharlesGlendinning, R. G.Lloyd-George, Rt. Hon. David
Carr-Gomm, H. W.Glover, ThomasLundon, T
Causton, Rt. Hon. Richard KnightGrey, Rt. Hon. Sir EdwardLupton, Arnold
Chance, Frederick WilliamGuest, Hon. Ivor ChurchillLynch, A. (Clare, W.)
Channing, Sir Francis AllstonGulland, John W.Macdonald, J. M. (Falkirk Burghs)
Clancy, John JosephGwynn, Stephen LuciusMackarness, Frederic C.
Clough, WilliamHaldane, Rt. Hon. Richard B.Maclean, Donald
Cobbold, Felix ThornleyHarcourt, Rt. Hon. L. (Rossendale)MacNeill, John Gordon Swift
Collins, Stephen (Lambeth)Harcourt, Robert V. (Montrose)MacVeagh, Jeremiah (Down, S.)
Collins, Sir Wm. J. (St. Pancras, W.)Harmsworth, Cecil B. (Worcester)MacVeigh, Charles (Donegal, E.)
Cooper, G. J.Harmsworth, R. L. (Caithness-shire)M'Callum, John M.
Corbett, A. Cameron (Glasgow)Harwood, GeorgeM'Kean, John
Corbett, C. H. (Sussex, E. Grinstead)Haworth, Arthur A.McKenna, Rt. Hon. Reginald
Cornwall, Sir Edwin A.Hazleton, RichardM'Laren, H. D. (Stafford, W.)

The Committee divided: Ayes, 85; Noes, 216.

M'Micking, Major G.Pointer, J.Stewart-Smith, D. (Kendal)
Mallet, Charles E.Pollard, Dr. G. H.Summerbell, T.
Markham, Arthur BasilPonsonby, Arthur A. W. H.Taylor, John W. (Durham)
Marnham, F. J.Power, Patrick JosephThomas, Sir A. (Glamorgan, E.)
Massle, J.Priestley, Arthur (Grantham)Thorne G. R. (Wolverhampton)
Masterman, C. F. G.Priestley, Sir W. E. B. (Bradford, E.)Tomkinson, James
Meagher, MichaelRainy, A. RollandToulmin, George
Middlebrook, WilliamRea, Rt. Hon. Russell (Gloucester)Verney, F. W.
Molteno, Percy AlportRea, Waiter Russell (Scarborough)Wadsworth, J.
Montagu, Hon. E. S.Reddy, M.Walsh, Stephen
Mooney, J. J.Rees, J. D.Ward, John (Stoke-upon-Trent)
Worrell, PhilipRichards, T. F. (Wolverhampton, W.)Waring, Walter
Muldoon, JohnRidsdale, E. A.Warner, Thomas Courtenay T.
Murphy, John (Kerry, East)Roberts, Charles H. (Lincoln)Wason, Rt. Hon. E. (Clackmannan)
Murray, Capt. Hon. A. C. (Kincard.)Robertson, Sir G. Scott (Bradford)Wason, John Cathcart (Orkney)
Myer, HoratioRobertson, J. M. (Tyneside)Watt, Henry A.
Nannetti, Joseph P.Robinson, S.White, Sir George (Norfolk)
Newnes, F. (Notts, Bassetlaw)Robson, Sir William SnowdonWhite, J. Dundas (Dumbartonshire)
Nolan, JosephRoch, Waiter F. (Pembroke)White, Sir Luke (York, E. R.)
Norman, Sir HenryRoe, Sir ThomasWilkie, Alexander
Norton, Captain Cecil WilliamRogers, F. E. NewmanWilliams, J. (Glamorgan)
Nussey, Sir WillansRose, Sir Charles DayWilliams, W. Llewelyn (Carmarthen).
Nuttall, HarryRussell, Rt. Hon. T. W.Williamson, Sir Archibald
O'Brien, Patrick (Kilkenny)Rutherford, V. H. (Brentford)Wilson, Hon. G. G. (Hull, W.)
O'Connor, John (Kildare, N.)Samuel, Rt. Hon. H. L. (Cleveland)Wilson, W. T. (Westhoughton)
O'Connor, T. P. (Liverpool)Samuel, S. M. (Whitechapel)Wood, T. M'Kinnon
O'Donnell, C. J. (Walworth)Scarisbrick, Sir T. T. L.
Partington, OswaldSchwann, Sir C. E. (Manchester)
Paulton, James MellorSeely, ColonelTELLERS FOR THE NOES.—Mr. Joseph Pease and Sir E. Strachey.
Pearce, Robert (Staffs, Leek)Shaw, Sir Charles E. (Stafford)
Pirie, Duncan V.Stanley, Hon. A. Lyulph (Cheshire)

Question, "That the Clause stand part of the Bill," put, an agreed to.

Clause 61—(Additional Customs And Excise Duties On Spirits)

(1) In addition to the duties of Customs payable on spirits imported into Great Britain or Ireland there shall as from the thirtieth day of April, nineteen hundred and nine, be charged, levied, and paid, the duties specified in Part I. of the Third Schedule to this Act.

(2) The duties of Customs on the articles mentioned in Part II. of the Third Schedule to this Act, being articles in which spirit is contained, or in the manufacture of which spirit is used, shall be proportionately increased, and there shall accordingly be charged, levied, and paid the duties specified in that Part of the schedule.

(3) In addition to the Excise Duty payable for every gallon computed at proof of spirits distilled in the United Kingdom there shall, as from the thirtieth day of April, nineteen hundred and nine, be charged, levied, and paid an Excise Duty of three shillings and ninepence, and so on in proportion for any less quantity.

I earnestly appeal to the Chancellor of the Exchequer to reconsider this question of taxing medical spirits. This is not a question of luxury but of necessity. When people are ill, spirits of this kind are ordered, and they are bound willy-nilly to take them. This is a very heavy tax on people who are ill able to afford it. A large number of our hospitals are struggling under great difficulties, and the increase here is estimated for some of them to amount to £2,000 or £3,000 a year. I have been in communication with several large chemists throughout the country, and this morning I had a letter from one who stated that he did not trouble about the tax because he simply intended to put it all on to the consumer. I had a letter from another, who said that his bill, in connection with these spirits, would be over £3,500 a year. Taking the London hospitals alone, I understand the tax will amount to over £50,000. The tax is bound to be extremely unpopular among the-poorer classes. Even a poor man who has to have a tooth out under gas will have probably to pay more fees on account of the tax.

As I understand, the proposal is to leave the duty on certain articles which are specified in the Second Schedule as they are at the present moment. That would be a very difficult thing to do. The late Lord Ritchie when Chancellor of the Exchequer brought in a Bill in 1903 to try to do something of the sort. That Bill failed. The views held by the hon. Gentleman opposite were for some little time held by the Pharmaceutical Society which sent a deputation to the Chancellor of the Exchequer. They heard what was to be said by the Board of Customs and Excise on the question, and they went away satisfied that the proposals embodied in this Amendment were impracticable for this reason. If you gave spirits duty free to chemists and hospitals, you could not subsequently control the disposal of the spirits by the person who was entitled to obtain the spirits duty free. He could destil the spirits out of the particular articles mentioned in the schedule, and you could not say whether they were used in a hospital or elsewhere. It would be impossible to say whether the chemist had disposed of them to the nearest public-house, or whether he really served them for the purpose of medicine. The objections, therefore, to giving the exemption are not so much theoretical as practical. The Government cannot accept the Amendment, and I hope the Committee will not agree to it.

I am not surprised to hear the right hon. Gentleman say that the practical difficulties in the way of accepting this proposal would be very great. Nobody who has not had access to official information and advice is in a position to discuss the matter in the same way as those who are dealing with such affairs, or to say whether the difficulties could be overcome. For certain purposes they are overcome now. Under a Bill which was passed in, I think, the first Session of this Parliament—a Bill which I had previously tried to pass—spirit is allowed for certain manufacturing purposes to be issued duty free.

The Chancellor of the Exchequer is thinking of the old Act which required that the spirit should be rendered impotable—denatured was the technical term—before it was issued. Substantially that met the case wherever it was possible to use denatured spirit. But the progress of science as applied to manufactures rendered it necessary in certain manufactures that pure spirit and not denatured spirit should be used. I believe it is called silent spirit. It is pure alcohol with neither taste nor smell out of which you can concoct whatever blend of spirit your customer may desire. At any rate, it was made clear that British commerce was hampered through our manufacturers not having the same facilities in regard to the use of this spirit as were enjoyed by their foreign competitors, and especially by the Germans, who have carried the application of chemistry to industry to a very high point, and I did seek in my last year of office to pass a Bill to render the issue of pure spirit to our manufacturers possible where we were satisfied that it could be done without fraud. I was unable to pass that Bill, but it was passed, I am glad to say, by the present Prime Minister as Chancellor of the Exchequer, I think, in the first Session of the present Parliament. Therefore, for the purposes of manufacture, it is now permissible to issue pure spirit without payment of duty on whatever security the Excise require being given that the spirit shall be used for the purposes for which it is nominally taken. I am not quite clear about the position, but I think it is possible that that spirit disappears in the process of manufacture, and that therefore if there were to be any fraud it must be drunk before it is used in manufacture, as it cannot be extracted afterwards. If that is so it does make a distinction between the case of these drugs and such cases as are now within the limit of the law. Whether it would not be possible for the Excise to take sufficient security in the case of chemists, speaking without access to official information, I cannot say. I only hope that the Government have seriously considered the question before they decided that it was impossible to make that distinction. If they have seriously considered it and the statement made by the Financial Secretary is their considered judgment, I am not in a position to dispute it and I do not dispute it. But I do say that this is one more reason against adding to the very heavy Spirit Duties which have already passed. We think of this tax as a tax on spirituous liquors drunk for pleasure or comfort. But here it is working out as a very heavy tax on drugs, and on drugs which have to be used by all classes of people equally and by charitable institutions to a very great extent, and the addition which is being made will be a very serious tax upon hospitals, dispensaries and other institutions of that kind. It is an incidental result of the tax which of course the Government did not contemplate, and which, no doubt, they would be as glad as anybody else to avoid. But if they say it is unavoidable the conclusion to be drawn is that there are even more objections to the additions made to this tax than appear on the surface.

I would like to say a word on this subject, having been at one time of my life a student of science. I would like to point out to the right hon. Gentleman who has just spoken that there are certain processes of manufacture in which alcohol is used as a solvent, and can be recovered again and again. In the dyeing industry it is used very largely as a solvent, and can be recovered. But I rose mainly to speak of the articles contained in Part II. of the Schedule. I do not wish to pose as a greater scientist than I am, but anyone who has followed this subject at all will know that several of these articles cannot produce alcohol at all. Of course by a series of elaborate chemical operations you can get alcohol from them, but when you have got it it is not really potable in a form which can be drunk. Chloroform, for instance, would require a considerable series of operations before you could get alcohol, and there are several other things which it may be desired for fiscal reasons to tax, but which cannot produce alcohol which would compete, though they could produce it for the purposes of intoxication. I would urge upon the Chancellor of the Exchequer to reconsider the arguments used on the Front Bench against removing this tax, and basing it, as I think it properly could be based probably, on purely fiscal reasons.

This tax will fall on these substances which have been mentioned, and surely it cannot be supposed that those who use these drugs would distil from

Division No. 720.]

AYES.

[11.35 p.m.

Allen, A. Acland, (Christchurch)Dobson, Thomas W.Hobhouse, Rt. Hon. Charles E. H.
Allen, Charles P. (Stroud)Duncan, C. (Barrow-in-Furness)Hodge, John
Ashton, Thomas GairDuncan, J. H. (York, Otley)Holt, Richard Durning
Asquith, Rt. Hon. Herbert HenryDunn, A. Edward (Camborne)Hope, W. Bateman (Somerset, N.)
Balfour, Robert (Lanark)Edwards, Sir Francis (Radnor)Horniman, Emslie John
Baring, Godfrey (Isle of Wight)Elibank, Master ofJones, Leif (Appleby)
Barker, Sir JohnEssex, R. W.Jones, William (Carnarvonshire)
Barnes, G. N.Evans, Sir Samuel T.Kelley, George D.
Barran, Sir John N. (Hawick B.)Everett, R. LaceyKing, Alfred John (Knutsford)
Barry, Redmond J. (Tyrone, N.)Ferguson, R. C. MunroLamb, Edmund G. (Leominster)
Bennett, E. N.Findlay, AlexanderLamont, Norman
Berridge, T. H. D.Fuller, John Michael F.Layland-Barratt, Sir Francis
Boulton, A. C. F.Fullerton, HughLever, A. Levy (Essex, Harwich)
Bowerman, C. W.Gibson, James PuckeringLevy, Sir Maurice
Bright, J. A.Gill, A. H.Lewis, John Herbert
Brodie, H. C.Glendinning, R. G.Lloyd-George, Rt. Hon. David
Burns, Rt. Hon. JohnGlover, ThomasLupton, Arnold
Buxton, Rt. Hon. Sydney CharlesGrey, Rt. Hon. Sir EdwardMacdonald, J. M. (Falkirk Burghs)
Carr-Gomm, H. W.Gulland, John W.Mackarness, Frederic C.
Chance, Frederick WilliamHaldane, Rt. Hon. Richard B.Maclean, Donald
Channing, Sir Francis AllstonHarcourt, Rt. Hon. L. (Rossendale)M'Callum, John M.
Clough, WilliamHarcourt, Robert V. (Montrose)McKenna, Rt. Hon. Reginald
Cobbold, Felix ThornleyHarmsworth, Cecil B. (Worcester)M'Laren, H. D. (Stafford, W.)
Collins, Stephen (Lambeth)Harmsworth, R. L. (Caithness-shire)M'Micking, Major G.
Cooper, G. J.Harwood, GeorgeMarkham, Arthur Basil
Corbett, A. Cameron (Glasgow)Haworth, Arthur A.Marnham, F. J.
Corbett, C. H. (Sussex, E. Grinstead)Helme, Norval WatsonMassie, J.
Cornwall, Sir Edwin A.Henderson, Arthur (Durham)Middlebrook, William
Cory, Sir Clifford JohnHenderson, J. M. (Aberdeen, W.)Molteno, Percy Alport
Crosfield, A. H.Henry, Charles S.Montagu, Hon. E. S.
Davies, Ellis William (Eifion)Herbert, Col. Sir Ivor (Mon., S.)Morrell, Philip
Davies, Sir W. Howell (Bristol, S.)Higham, John SharpMurray, Capt. Hon. A. C. (Kincard.)

them spirit which might be potable and might be used for other purposes in competition with whisky. If this tax is really intended, then I say that the Chancellor of the Exchequer has a very poor opinion of those who conduct hospitals and dispensaries. This tax amounts to an increase of from 33 per cent. to 37 per cent. in the duty. In one hospital alone it will amount to £250 a year. No one can say that is not an appreciable amount in the case of a single hospital, especially in times like these when subscriptions are falling off. These institutions are hit heavily. Besides, the amount which the Government will get is comparatively small. The real object of this duty is to get a large amount of revenue from whisky, and in the circumstances I really think hospitals and dispensaries, photographers and dentists, and others, should be saved from the burden of this extra duty, especially considering the enormous duty which is already being derived from the duty on drugs. In a country like England it is hardly necessary to tax things which are used in times of stress and trouble, or that hospitals and dispensaries should be subjected to an unnecessary burden.

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

The Committee divided: Ayes, 159; Noes, 84.

Myer, HoratioRoberts, Charles H. (Lincoln)Wadsworth, J.
Newnes, F. (Notts, Bassetlaw)Robertson, J. M. (Tyneside)Walsh, Stephen
Norman, Sir HenryRobinson, S.Ward, John (Stoke-upon-Trent)
Norton, Capt. Cecil WilliamRobson, Sir William SnowdonWarner, Thomas Courtenay T.
Nussey, Sir WillansRoch, Walter F. (Pembroke)Wason, Rt. Hon. E. (Clackmannan)
Nuttall, HarryRoe, Sir ThomasWason, John Cathcart (Orkney)
O'Donnell, C. J. (Walworth)Rogers, F. E. NewmanWatt, Henry A.
Parker, James (Halifax)Russell, Rt. Hon. T. W.White, Sir George (Norfolk)
Partington, OswaldRutherford, V. H. (Brentford)White, J. Dundas (Dumbartonshire)
Paulton, James MellorSamuel, Rt. Hon. H. L. (Cleveland)White, Sir Luke (York, E. R.)
Pearce, Robert (Staffs, Leek)Samuel, S. M. (Whitechapel)Wilkie, Alexander
Pickersgill, Edward HareScarisbrick, Sir T. T. L.Williams, J. (Glamorgan)
Pirie, Duncan V.Schwann, Sir C. E. (Manchester)Williams, Llewelyn (Carmarthen)
Pointer, JosephSeely, ColonelWilliamson, Sir Archibald
Pollard, Dr.Shaw, Sir Charles EdwardWilson, Hon. G. G. (Hull, W.)
Ponsonby, Arthur A. W. H.Stanley, Hon. A. Lyulph (Cheshire)Wilson, W. T. (Westhoughton)
Priestley, Arthur (Grantham)Stewart-Smith, D. (Kendal)Wood, T. M'Kinnon
Rainy, A. RollandSummerbell, T.
Rea, Rt. Hon. Russell (Gloucester)Taylor, John W. (Durham)
Rea, Walter Russell (Scarborough)Thorne, G. R. (Wolverhampton)TELLERS FOR THE AYES.—Mr. Joseph Pease and Sir Edward Strachey.
Rees, J. D.Tomkinson, James
Richards, T. F. (Wolverhampton)Toulmin, George
Ridsdale, E. A.Verney, F. W.

NOES.

Acland-Hood, Rt. Hon. Sir Alex, F.Fletcher, J. S.Morrison-Bell, Captain
Anson, Sir William ReynellForster, Henry WilliamNewdegate, F. A.
Arkwright, John StanhopeFoster, Philip S. (Warwick, S. W.)Nicholson, Wm. G. (Petersfield)
Balcarres, LordGardner, ErnestPease, Herbert Pike (Darlington)
Banbury, Sir Frederick GeorgeGoulding, Edward AlfredPeel, Hon. William Robert Wellesley
Banner, John S. Harmood-Gretton, JohnRatcliff, Major R. F.
Beckett, Hon. GervaseGuinness, Hon. R. (Haggerston)Renton, Leslie
Brotherton, Edward AllenHaddock, George B.Renwick, George
Burdett-Coutts, W.Hamilton, Marquess ofRoberts, S. (Sheffield, Ecclesall)
Campbell, Rt. Hon. J. H. M.Hardy, Laurence (Kent, Ashford)Ronaldshay, Earl of
Carlile, E. HildredHarris, Frederick LevertonRutherford, John (Lancashire)
Carson, Rt. Hon. Sir Edward H.Harrison-Broadley H. B.Rutherford, Watson (Liverpool)
Castlereagh, ViscountHealy, Maurice (Cork)Salter, Arthur Clavell
Cecil, Evelyn (Aston Manor)Healy, T. M. (Louth, North)Smith, Abel H. (Hertford, East)
Cecil, Lord R. (Marylebone, E.)Hermon-Hodge, Sir Robert T.Stanier, Beville
Clive, Percy ArcherHill, Sir ClementStarkey, John R.
Clyde, James AvonHills, J. W.Staveley-Hill, Henry (Staffordshire)
Coates, Major E. F. (Lewisham)Hope, James Fitzalan (Sheffield)Talbot, Rt. Hon. J. G. (Oxford Univ.)
Cochrane, Hon. Thomas H. A. E.Hunt, RowlandThomson, W. Mitchell- (Lanark)
Collins, Sir Wm. J. (St. Pancras, W.)Kennaway, Rt. Hon. Sir John H.Valentia, Viscount
Corbett, T. L. (Down, N.)Keswick, WilliamWalker, Col. W. H. (Lancashire)
Courthope, G. LoydKing, Sir Henry Seymour (Hull)Warde, Col. C. E. (Kent, Mid)
Craig, Captain James (Down, E.)Lee, Arthur H. (Hants, Fareham)Williams, Col. R. (Dorset, W.)
Craik, Sir HenryLockwood, Rt. Hon. Lt.-Col. A. R.Wilson, A. Stanley (York, E. R.)
Dickson, Rt. Hon. Charles ScottLong, Rt. Hon. Walter (Dublin, S.)Wortley, Rt. Hon. C. B. Stuart-
Douglas, Rt. Hon. A. Akers-Lowe, Sir Francis WilliamYounger, George
Duncan, Robert (Lanark, Govan)MacCaw, William J. MacGeagh
Faber, George Denison (York)Mason, James F. (Windsor)TELLERS FOR THE NOES.—Sir
Faber, Capt. W. V. (Hants, W.)Morpeth, ViscountWilliam Bull and Mr. Fell.

moved in Sub-section (3), to leave out the words "three shillings and ninepence," and to insert instead thereof the words "one shilling."

The Excise Duty in spirits prior to the Budget of the present year was 11s. per proof gallon, having been raised from 10s. 6d. by the extra 6d. imposed as a war tax in 1900, and subsequently made permanent. The Budget increase of 3s. 9d. per proof gallon has raised the duty to 14s. 9d. and the increase on the Excise and Customs Duty on spirits under the Budget, had the consumption remained unaltered, would have meant an addition of some £7,000,000 to the Revenue from the Spirit Duty. Having, however, to face a falling consumption, and the additional effect of the enormous increase in the duty, the Chancellor of the Exchequer estimated

that the increased yield of the duty would be about £1,600,000. He is reported to have said, and I think it is correct, that he had calculated on an 11 per cent. decrease in the consumption, but I have made a very careful examination of the available figures, and it seems to me that a reduction of about 15 per cent. may have been in his mind, the discrepancy perhaps being explained by his having in his reported remark dealt only with the further fall owing to the increase in the duty, and not with the decline of the consumption, which has been in evidence for years past. Assume that with a 15 per cent. drop in consumption as compared with last year, the yield at the increased duty might have produced the additional £1,600,000 to the Exchequer. What is shown by the returns as to the actual effect of the new duty?

The financial year terminates on March 31st. The Budget was not introduced till April 29th. The new Spirit Duty of 3s. 9d. per proof gallon became operative on and after April 30th. As the Chancellor of the Exchequer anticipated, the clearances in April largely swelled the yield in that month. The influence of such anticipatory clearances in March and April must be borne in mind when considering the heavy fall shown in the figures for May and June. But the general figures are very striking. The following figures have been given in reply to questions asked in Parliament by various hon. Members on July 13th, August 12th, and September 6th. The figures of beer and wine are also quoted, though the matter in point in the present instance relates to the figures as to spirits only:—In April, 1907, the home-made was £1,435,000; imported, £331,000; total, £1,766,000. In April, 1908, the home-made was, £1,435,000; imported, £327,000; total, £1,762,000. In April, 1909, the figures respectively were: £2,354,000, £486,000, and £2,840,000. In May, 1907, the figures were £1,461,000, £317,000, and £1,778,000. In May, 1908, the figures were £1,360,000, £280,000, and £1,640,000 respectively. In May, 1909, home-made dropped to £387,000; imported, to £104,000; total, £491,000. Therefore from April, 1907, to May, 1909, the drop was to considerably less than one-third. In June, 1907, the respective figures were: £1,234,000, £250,000, and £1,484,000. In June, 1908, the respective figures were £1,190,000, £219,000, and £1,409,000. In 1909, we get another drop, the figures being £587,000, £129,000, and £716,000. In July, 1909, the figures were £990,000, £180,000, and £1,170,000. In August, 1909, home-made was £1,075,000; imported, £188,000; total, £1,263,000, against £1,600,000 in August, 1907. Therefore, the drop, if the Committee have been able to follow these figures is something terrific in spirits. It is far more than the Chancellor of the Exchequer evidently ever anticipated. The fall directly the new duty came in force is very striking. The following Question and Answer, put and given in the House on September 13th, 1909, may be quoted:—

"Mr. PATRICK WHITE asked the Chancellor of the Exchequer what was the reduction in revenue on spirits taken out; of bond in Great Britain and Ireland during the four months May to August this year, as compared with the same period fast year; and whether he would stale the quantity of spirits taken out of bond for the seven months September, 1908, to March, 1909, and the quantity which would require to be taken out during the corresponding seven months of 1909–10 to produce revenue which, added to the preceding four months' yield, would give an amount equal to the revenue derived from duty on spirits in the corresponding eleven months of 1908–9, plus the estimated increase of revenue from the new duty?"

The Secretary to the Treasury answered and said:—

"The reduction in the revenue from spirits in the four months, May to August, 1909, as compared with May to August, 1908, was £2,189,000. The quantity of spirits on which duty was paid for the seven months September, 1908, to March, 1909, was 21,574,000 gallons. The quantity which would require to be cleared for the seven months from September, 1909, to March, 1910, in order to make the spirit revenue for the last eleven months of 1909–10 exceed that for the corresponding period of 1908–9 by the estimated increase of revenue from the new duty, i.e., £1,1100,000, would be about 23,680,000 gallons."

The explanation of the figures given in the above question as to the four months May to August seems to be as follows:—1908, 11,148,000 gallons, at 11s., brought in £6,131,000. In 1909 there were only 4,960,000, at 14s. 9d., which brought in £3,658,000, showing a decrease of £2,473,000. But the official figure for the decrease is slightly more, namely, £2,489,000. It will be observed that the question of the hon. Member for North Meath omits the month of April, no doubt owing to its abnormal position. The four months' (May-August) result of the operation of the new duty shows a decrease of 55½ per cent. in the consumption. If the April figures be included with the large clearances there is still a decrease of 29.2 per cent. in the amount taken for consumption. Now, to get the money estimated by the Chancellor of the Exchequer, it will be seen from the reply quoted above that the amount of spirits to be taken for consumption during the remaining seven months (September to March of the current financial year) would have to be only 894,000 gallons less than the figure for the same months in the preceding year. There would have to be only a decrease of 3.6 per cent. This points to the probability of a deficit instead of the expected gain; and illustrates the truth of the contention that the limit of taxable capacity had been reached.

It is clear, of course, that the estimate that consumption would fall off by one-sixth was too low. But, taking that figure, it would follow that instead of 23,000,000 gallons only 19,133,333 will have duty paid on them during these seven months. That is at least 4,500,000 gallons less than the Chancellor of the Exchequer requires. Translated into money at 14s. 9d. a gallon, it means that the Chancellor of the Exchequer will get £.3,318,000 less than he estimated. That is to say, instead of gaining £1,600,000, he will lose £1,700,000 or more. As the consumption is diminishing to a greater extent than was anticipated, it is, indeed, probable that he will lose considerably over £2,000,000. This is a specimen of his finance. He has been warned again and again that it is unwise to tax a falling industry. He would not listen. He seems to have obstinately clung to the belief that if only you add enough to the duties they must yield more, which, of course, is a failing that Chancellors have again and again discovered to their cost. When they increase a tax upon a commodity beyond its taxable capacity the result, instead of a gain to the Exchequer, results in loss. The right hon. Gentleman has added as much as he dare to the Spirit Duty and there is still the prospect of losing £2,000,000 to the Exchequer. He says, in justification of this tax on whisky, that be must have the money. I am afraid in this particular instance in the Budget, instead of over-estimating as he has done on other occasions, it is perfectly clear that in this particular case he will probably lose a very considerable amount. I urge the right hon. Gentleman to reconsider this matter, and try to remedy the mistake which I contend he has made by this proposal.

12.0 P.M.

The hon. Member has given the Committee a number of figures to which I shall incidentally refer, but I will endeavour, as far as possible, not to repeat his statement. The figures which the hon. Gentleman has used refer mainly to the consumption of whisky. I would like the Committee to understand the point of view from which Members of the party in whose name I am speaking look at this tax, and that is not from the point of view of the consumption of whisky, but as a tax dealing a deadly blow at one of the very few manufactures left in Ireland. The very first figures I will quote will show that point of view. The average amount of spirits distilled in Ireland in 1906–7–8 was 12,105,499 gallons, and the average amount of spirits exported during the same period was 8,155,157 gallons. In round numbers it comes to this, that of the 12,000,000 gallons of whisky which were manufactured in Ireland, 8,000,000 gallons were exported. On this side of the House we have always contended that a large and pressing tax on whisky as compared with a small tax on beer was a preferential disadvantage to us, because, after all, whisky is the popular beverage of Ireland and beer is the popular beverage of England. I do not want to dwell too much upon that fact, because I believe that statistics recently issued show that the consumption per capita in Ireland of whisky is rather lower than the consumption in England and Scotland. Although I hold the view that it is unfair to Ireland to tax its popular beverage gigantically higher proportionately than the popular beverage in England. I contend that the main strength of our position is that you are taxing in our case a manufacture as well as a beverage. I have given figures to show that of the whisky manufactured in Ireland, roughly, £12,000,000. £8,000,000 as an average are exported. On this question of taxing of whisky, we have maintained this position from almost the first moment the tax was brought into existence, and I regret to say that the history of the tax is far from creditable to the finances of this country and to those Gentlemen, to whatever party they belonged, who have been in charge of them. This tax was brought into existence in 1853 by the late Mr. Gladstone when he was Chancellor of the Exchequer.

Naturally, it is far from my desire to say anything which might seem in the least degree derogatory to the memory of Mr. Gladstone, for, whatever disservice he did to Ireland in the earlier stages in his career, he more than made up for it by his passionate devotion to the cause of that country; but, at the same time, looking on Mr. Gladstone purely as a financier in 1853, I am sure in unconsciousness and in ignorance of the facts of the tax and of the conditions of Ireland, he inflicted upon Ireland one of the heaviest blows it ever received from the legislation of this country. In that year he established this tax and inflicted upon Ireland an additional burden of £2,500,000 of money. That is a very large addition to the taxation of a poor country at any time, and the hardship on that particular occasion was aggravated, according to the confession of every man, including, I believe, Mr. Gladstone himself, because this enormous addition to the taxation of Ireland was inflicted when she was just beginning to emerge from all the sorrows and sufferings of the famine which began in the year 1846. To show how even a humane man like Mr. Gladstone could, ignorant of the conditions of Ireland, inflict such a grievous injury upon the country, I have only to recall to the memory of the Committee what was painfully familiar to us on these Benches that, at the very moment he added £2,500,000 of taxation to Ireland, people were flying from her shores at the rate of from 100,000 to 200,000 a year. I do not want to make the present Chancellor of the Exchequer responsible for all the errors and sins of his predecessors, but we feel we have on this question a great and grievious historic wrong. We have therefore, whenever a proposal has been made to increase this tax, always opposed the Government of the day. If I am not very much mistaken, it was on a proposal of the late Mr. Childers to increase the tax in 1885, that we defeated a great Ministry. After that defeat, Chancellors of the Exchequer left us alone for a while. There then, however, came the war, and Sir Michael Hicks-Beach, looking round for revenue, made an addition to the tax on whisky. What was the condition? I am sure the Chancellor of the Exchequer must look with something like scorn on the timid modesty of his predecessor, for while he adds 3s. 9d. to the duty Sir Michael Hicks-Beach only put on 6d., and he excused his action on two grounds: First, he said it was a war tax. Of course a great war justifies taxation which would be unreasonable in times of peace. The second ground of excuse was that it was only a temporary tax. Sir Michael Hicks-Beach's words were:—
"I look upon it (the 6d. additional duty) as a temporary addition to existing taxation, and I hope merely for the coming year."
That was the statement which was made in 1890; yet the tax which was to be imposed for one year only has remained ever since on this Irish manufacture, and the only realisation we have of the promise held out to us by Sir Michael Hicks-Beach is not the remission of the extra sixpence, but an addition to the tax of 3s. 9d. That is briefly the history of this taxation. Anybody who like me has represented in this House the ancient City of Galway, or who spent much of his boyhood there, must feel very acutely on this question. One of my earliest recollections is of the hideous skeleton of what was once a prosperous distillery. There is scarcely a town in the British Empire which bears upon its streets a more eloquent imprint of the disastrous results of decreasing trade and population. Every one of my friends who has visited that place will corroborate me when I say that there are in the centre streets a number of ghastly ruins of once reputable and decent houses. These ruins were to be seen in Galway when I was a boy: they are still to be seen there and many others have since been added to the large number already in existence. But up till a few years ago there was one distillery left there. Now, however, that has disappeared, and anyone who has an idea of the hideous and crying want of employment in that poverty-stricken city will appreciate what it means when still another place of manufacture is closed.

My hon. Friend and successor in the representation of Galway tells me that no fewer than 100 men were thrown out of employment by this last disaster. I knew very well the proprietor of that distillery, Mr. Henry Persse. He was a good old County Galway landlord and Tory. He told me the history of that distillery, and one of the most interesting chapters was this: In order to make the whisky as good as possible and to put it on a level with the best whiskies produced in Scotland, he came over to England to the place of business of a most respected Member of this House who died a few years ago—the late Col. Webb—and got from him the best barley seed that could be produced. Then he went back to County Clare and there created a new barley industry. Therefore I still adhere to my main position that you are interfering with a manufacture, and everybody will see who will pursue the facts of this case, that it is not only the manufacture of whisky that 13 paralysed or considerably prejudiced by such proposals as these, but a large amount of unemployment is created. This is true not only in regard to distilling, but that want of employment pursues Ireland in other directions, such as agriculture and the diminution of the crop of barley, which is one of the Irish farmer's best sources of revenue. Is it fair to Ireland at the moment when she is still suffering from the effects of the paralysis of her industries by the selfish lgislation—admitted to be selfish by every man in this House—of this country in the eighteenth century, that Ireland should be left with only a few manufactures, and you should inflict this deadly blow upon the manufacture of whisky and all the industries which are allied and associated with its manufacture. That is my objection to this tax from the point of view of the manufacturers; but I also venture to find fault with my right hon. Friend—though it is rather daring for me to do so—from the financial point of view, and here again, although I have not the exact words, I quote Sir Michael Hicks-Beach, who, when he was urged by some people to increase the tax upon whisky, speaking strictly from the financial point of view of the Chancellor of the Exchequer, said that his reason for not increasing the tax on whisky was that he found that if you increase the tax beyond a certain point on such a product as whisky, the result was not the increase but the decrease of the return from that article, and my hon. Friend behind me, although I do not recollect it myself, says that Sir William Harcourt, also a great financial authority, said the same thing. Surely if ever prophecies were proved to be true by subsequent events these two prophecies of these two distinguished financiers have been realised. Of the many figures that were quoted by my hon. Friend I will only give just one, which, I understand, was drawn from an answer given from the Treasury Bench, and according to it the reduction of revenue from spirits from May, 1909, to August, 1909, as compared with the same period of the previous year was no less a sum than £2,489,000. I know that like the hon. Member, whom I once ventured to call the Robespierre of the Temperance Party, there are a certain number of men who would say that the fact that revenue was diminishing from whisky was "glad tidings of great joy."

I do not take quite the view that the reduction in the consumption of whisky necessarily means even an increase in temperance. What it does mean, and has meant in Ireland, is that people drink less whisky and more porter. That seems to me a very inverted kind of temperance indeed. But the peculiar position in which Ireland is placed is this: that if the consumption remains stationary then the customer has to pay the additional tax. If the export remains stationary or goes down, as it has done, Ireland again is damnified because of the reduction of the profits upon what is now one of her few remaining industries. I had hoped that the Chancellor of the Exchequer would see his way, taught by the falsification of his anticipations, to do away with this addition to the tax altogether. This tax has created in Ireland a feeling of disappointment—I might almost say of despair. If from a Government, many Members of which are friendly to the political opinions of the Irish Party, we are to get so crushing a blow as this, it seems almost to drive us to the conclusion that it is hard to expect on this whisky tax justice from any Ministry, whatever be its political complexion.

If there is a strong case for the Irish distiller there is a stronger one for the Scotch distiller, because if the tax hits Ireland unfairly, it hits Scotland very much more unfairly. If there is a reduction of something like 25 per cent. in the manufacture of Scotch distilleries, it is a very serious thing for the Scotch manufacturer. But I want to speak more from the point of view of the user, and how it is going to affect Scotland and the taxpayer in Scotland as a whole. I think it will result in inconvenience to the one and injustice to the other. I know the Chancellor of the Exchequer will say that although economically this may not perhaps be easily defended, still, morally, it is a good tax. I believe the Chancellor of the Exchequer ought to keep in view the moral effect of the tax just as well as the economic effects of it, but at the same time I do not think the moral effect of this tax justifies the economic unsoundness of it. I believe its effect will be to send those who at present use spirits to use what is, to many of them, a much more objectionable and injurious form of stimulant. I know that since the Budget was introduced a return has been got from Scotland showing that the arrests for drunkenness have very materially decreased. Well, you cannot impose an additional tax of 33 per cent. on an article without having very unexpected results.

It is possible, of course, to make alcohol so expensive that nobody could afford to drink it, but there are many who will drink whether they can afford to do so or not. Those men who drink too much will have it whatever it may cost. The reduction in the consumption will take place not among the intemperate users of spirits, but among the temperate users. The increase in the duty will drive people to seek stimulants in illegal ways. I do not know whether the Chancellor of the Exchequer has discounted the chance of an increase in smuggling. The methods adopted for checking smuggling in Scotland have been very effective. I do not believe that it is so flourishing an industry as it used to be. In Ireland there are many seizures of smuggling apparatus. In the east ends of great towns some smuggling is carried on, and I should not be surprised if the change now to be made in the duty were to lead to an increase in that illicit industry. It is not difficult to make spirits. All you require is a kettle and a few yards of tubing. In that way spirits can be obtained which can be used by people who are not particular about quality. It is a good thing that the Chancellor of the Exchequer takes the view that this tax may be defended on moral grounds, for on economic grounds it cannot be defended. It has been proved that it is economically unsound. We are all in favour of taxing luxuries, but this of all luxuries was the least able to bear it. It is already taxed 800 or 900 per cent. on the cost. Other kinds of alcohol are taxed on a very different scale. The spirit in beer, which is the drink of Englishmen, is taxed 2s. 2d. per proof gallon; in wine, 4s. 2d. to 7s. 4d. per gallon; while spirits are now to be taxed 14s. 9d. per gallon. It would seem, therefore, that of all luxuries spirits is the one which ought not to have been taxed. Over and above that the demand for spirits is steadily declining, and an article which is becoming less popular is surely not the one which should be singled out for increased taxation. Beer has increased in popularity, and is being more largely consumed. [An HON. MEMBER: "The consumption of beer has gone down."] It increased last year. No other article would have been treated in this way. The Chancellor of the Exchequer might have been warned by what happened when the duty on spirits was last increased, but in the face of that the duty is to be increased 3s. 9d. per gallon, or about 33 per cent. The result may be that instead of getting the £1,600,000 additional revenue which the Government hope to receive, the increase will yield to the revenue nothing at all. It is very likely that the duty will yield much less at 14s. 9d. than last year when it was 11s.

One word as to how it affects Scotland. It hits the manufacturer. It means a reduction of something like 25 per cent. in the working of various distilleries. Those distilleries are mainly in the Highlands and the poor districts. There is a large group of them on the west coast, but they are mostly in Morayshire, Banffshire and Inverness-shire, in the very poorest parts of the country. Now as to how it affects the Scotch taxpayer. The Scotch taxpayer is taxed at a very much higher rate for the article he consumes than any other inhabitant of these islands. The Englishman consumes 4·6 proof gallons of alcohol in the year, and the Scotchman 3·2 proof gallons. The Englishman consumes it in the proportion of four parts of beer to one of spirits, and the Scotchman three parts of beer to four parts of spirits. The Englishman for his 4·6 proof gallons of alcohol pays 16s. 10d. to the revenue, while the Scotchman for his 3·2 proof gallons pays the revenue 22s. The Scotchman consumes 1·4 gallons less and contributes 5s. 2d. more. Take the consumption for the whole of the country. Last year England consumed 22 million gallons of spirit, Scotland consumed 7 million gallons, and Ireland 36 million gallons. England consumed a great deal more than the other two put together.

The Prime Minister reading out an answer to a question seemed to think that that was a complete answer to the accusation that they were taxing Scotland unfairly. But those are the very figures to which we object. The proportion of taxation which ought to be contributed to the revenue is—England 80 per cent., Scotland 11 per cent., and Ireland 9 per cent., but of the taxation England contributes only 61 per cent. instead of 80, Scotland 21 per cent. instead of 11, and Ireland 11 instead of 9. These are the proportions for last year. The extra 3s. 9d. would make it infinitely worse now. In a full year England would contribute £4,100,000 more, Scotland £1,300,000, and Irleand £680,000 extra. Scotland would thus pay £610,000 more and Ireland £130,000 more than its fair share. England is thus paying upwards of £700,000 less than its fair share. I know that the Chancellor of the Exchequer, in reply to a question, pointed out that on the Licence Duties England contributes a very large sum, which ought to equalise those duties, but since that the Licence Duties have been modified, and in that event we are entitled to ask for a modification of the Spirit Duty. I think the Chancellor of the Exchequer recommended that the licence holder should put the extra profit he got on the increase in price of spirits towards paying any Licence Duty in view of that. I was a little surprised to hear the Chancellor of the Exchequer say to-day that he did not think the Licence Duty was ultimately paid by the consumer.

My point is this: If, as the Chancellor of the Exchequer says, this question is put right by the Licence Duty being much more largely contributed to in England than if he modified the Licence Duty, then at the same time, in fairness, he ought to modify the Whisky Duty. If the extra duty, this sum which the Chancellor of the Exchequer requires, had been raised from beer, what would the effect have been. Beer stands in a very much better position than spirits. The reason which the Chancellor of the Exchequer gives is that he could not put such a sum on beer as would justify the retailer in putting on a halfpenny per glass. I am surprised that the Chancellor of the Exchequer should think that any disadvantage. The present duty on beer is only one halfpenny on three glasses, and yet it is paid by the consumer. How is the extra duty on spirits paid? It is not paid in every case by putting on one-halfpenny per glass. Some retailers have raised the price, some have reduced the quantity, some have reduced the quality, and some, I dare say, have done all three. But that will regulate itself ultimately. Competition between traders will ultimately put that right, and the result will be that the consumer will certainly pay all the duty, and probably a little more. If this had been put on beer instead of whisky, Scotland would have paid a million pounds less than she now pays by this form of tax, and that means 5s. per head for every man, woman and child in that country. It is a very serious thing. I am sorry the Prime Minister is not here, for I wished to draw his attention to the constituency of East Fife, which is a fair specimen. On a moderate computation it will mean something like £15,000 contributed by East Fife, and something like a million pounds contributed by Scotland more than its fair share. I have only this further to say, that, seeing the return from 14s. 9d. is to be less than the return from 11s., if the Chancellor of the Exchequer will accept the Amendment which is proposed by the hon. Member opposite, he will get not less but more revenue from this tax.

The three speeches to which we have listened from an hon. Member opposite, from an hon. Gentleman below the Gangway, and from my hon. Friend behind me have been very much to the same effect, all couched in very similar language, all breathing a very similar spirit, and all making complaint, not, I am happy to say, that some extra contribution should not be made by the consumers of whisky, or the producers of whisky, as the case may be, but all agreeing that there should be some increase while deprecating the necessity for that increase which is involved in the new proposal.

No, but the hon. Gentleman who moved this Amendment to insert 1s. instead of 3s. 9d., so that at all events he agrees that a tax of one shilling is not unjust or unfair to put on the consumers of whisky, because after all the producers or manufacturers invariably do their best to transfer the tax to the consumer. The hon. Gentleman who moved the Amendment gives the House a number of very interesting figures which it was rather difficult to follow. [Mr. T. M. HEALY, "Oh!"] They occupied twenty minutes and I confess I was perfectly unable to follow them, and I think the majority was in the same position as myself. The hon. Gentleman opposite has a copy of it, and it is easier for him than anybody else in the House to do so. As far as I could understand, his principal complaint was that we had very much underrated the decrease in the consumption and the consequent fall in revenue which resulted from the increase in the tax. I have answered on behalf of my right hon. Friend a great number of questions put to me from every part of the House for at least three or four months trying to prove that the small increase which was estimated by my right hon. Friend was an improperly small increase, and that we were deliberately and unjustifiably putting down the increased revenue which we might expect from the increased tax, and that we were, to that extent, trying to mislead the House of Commons and the country by our anticipations. From the point of view of revenue unhappily we were only too sanguine with our estimate. There have been two quite clear and easily understood reasons why there has been a great falling off in the apparent consumption of whisky, and the withdrawal of whisky from bond, and the falling off in revenue. One is due to the anticipation that took place previous to the present financial year, and in the second place the anticipation which took place between the 1st of April and the 30th of April of this year. The statement was made somewhat later than usual, and the trade being excited by some extra tax on whisky the result was that there were large forestalments swelling the revenue of last year and depleting the revenue of this year; from both causes to which I have alluded. But in addition to that which is the normal case whenever an increase is anticipated—

My right hon. Friend, who will speak later, has got them and will give them to the House. In addition to that usual forestalment there is a very considerable hope, on the part of at all events some of those who deal in spirits, that the duty will not be imposed. Some are hoping that the Chancellor of the Exchequer will mitigate what they deem to be the severity of the tax, and others hope, owing to an electoral decision, that the proposal may be nullified. Both those anticipations are, I think, false. The postponement of the withdrawal of whisky from bond and placing it upon the market, while undoubtedly depleting the revenue for the earlier part of the year, will only swell it in the later part. But however that may be, the fact remains that at the present moment the revenue is undoubtedly a great deal less than we had anticipated. As has already been pointed out, there has been a great decrease in the consumption of whisky. I do not know whether the fact is deplored by hon. Gentlemen opposite; it is certainly not by the great majority of Members on this side. The hon. Member for Inverness (Sir J. Dewar) said that this was not merely an economic, but a moral tax. It was not imposed by the Chancellor of the Exchequer with any view to morality, but if its fiscal operation leads to morality, I do not think any Member in the House could object to that result. With reference to another apprehension of my hon. Friend, I can assure him that there is no indication of any sort to lead the revenue authorities to suppose that there either has been or is any considerable prevalence of smuggling, at any rate in Scotland, and there has been no increase lately. The hon. Member for the Scotland Division of Liverpool (Mr. T. P. O'Connor) referred to the fact that when Sir M. Hicks-Beach, as he then was, put an extra 6d. on whisky, it failed to produce any more revenue, and led to the belief that the taxation of spirits had practically reached Lbs highest point. The folly, from the fiscal point of view, of putting on so small a tax as 6d. is that it is quite possible to defeat the intention of the Government by decreasing the strength of the whisky, by lowering the quality while adding to the quantity. One of the reasons which have led my right hon. Friend to propose so heavy an addition to the tax is the belief that it will be impossible to evade the imposition by decreasing the strength of the spirits sold. I have been taken to task for saying all taxes are unpleasant. I do not know that the taxation of whisky is more pleasant than any other taxation; but if one of the results of the heavy taxation is to diminish the consumption of that spirit I do not think it is a fact to be altogether regretted by the House.

The greater the inexperience of the Minister the more confident he becomes. So far as I know, both the Secretary to the Treasury and the Chancellor of the Exchequer are in their first year's Budget, and one would suppose, to listen to them, that they were Finance Ministers of 25 years' standing. Accordingly, these Gentlemen, who never had the taxation of the country in their hands before, get up into the box with absolute self-confidence, as if they had served an apprenticeship to the job, and deny the experience of generations, and throw to the winds the statements and suggestions of men of experience, Mr. Gladstone and Sir Michael Hicks-Beach. In this case they do so in face of the flattest contradiction of their own prophecies; in face of the falling revenue of millions, against their own estimate of increased revenue.

I want to call the attention of the House to the way Ireland suffers—I do not say that Scotland is not in the same case—from the Budget. Here we are in the month of September dealing with an overloaded Budget—a tired House, a tired Ministry, with fatigue as the fastest friend of the Government. What was the case before this system of Finance Bills had been invented, and invented apparently to cope with the House of Lords? Practically every tax was the subject of a separate Bill. Now you take up this question, affecting vitally one country out of three, or two countries out of three. And you, by the modern system of finance legislation, by introducing a whole number of other things in which the other countries are less interested, put the minor grievances of the larger and wealthier country in the foreground, and then you get not only an exhausted house, but an exhausted party, and naturally laxity of attention and Debates after midnight. As to the new system, take the case we heard to-night. You put first in this very Clause a tax on chloroform—on hospitals, on charity, and on photographers. The very drafting of this Clause is an offence, because you, in order that you may dawdle out the time, attempt practically a fraud on the House of Commons. Why, even your Schedule is better than your Clause. You put in your Schedule, page 53, an additional duty on spirits first. You put the duty on chloroform, and chloral hydrate in the second Schedule. This is modern draftsmanship; this is modern finance. Of course all these things are cunningly contrived, just as the Minister cunningly contrives to put this tax into the sixty-first Clause of his Bill. Fancy a tax of this kind affecting-Ireland and being put number sixty-one in order! Of course English Members who are rich men can spend their time here; they have only to take a shilling hansom cab to come clown to the House. It is nothing to them, but perhaps if they lived four or five hundred miles away, and had to come here at great expense, and stay here at great expense, they might take a different view of the case. So much upon what I may call the fringe of the subject.

Let me come now to the prophesy of the Chancellor of the Exchequer. The Secretary to the Treasury conceded one thing which I perfectly believe. When the hon. Gentleman above the Gangway quoted the right hon. Gentleman's own figures, he said he was unable to follow them. I fully accept that statement. The extraordinary thing, however, is that these figures which were collated by hon. Members above the Gangway and by us, were extracted by a question of the hon. Member for North Meath, and were read everyone of them by the Secretary to the Treasury in the answer which he gave to the hon. Member. What does that prove? It proves that the right hon. Gentleman was a mere phonograph of the Treasury. He rattled them off without in the least taking the smallest interest in the fact that so far as some of the countries he is supposed to govern are concerned—these are vital statistics—and he does not understand them. That is modern finance: he does not understand his own figures, and he is quite proud of it. Another extraordinary thing is his whole reply was founded upon this fact. "Oh," said he, "it is all to be explained by anticipatory withdrawals." He is confident of that. I asked him could he give the figures of the anticipatory withdrawals. Not at all! His right hon. Friend the Chancellor of the Exchequer would give them when he came to speak. Is this the case of the Finance Minister that he is stuffed like a turkey for fattening? The Treasury clerks take a mass of figures and by some means or another he gets them into his system; he cannot assimilate them, and when his own figures are quoted he is really unable to comprehend them. I fancy I see Mr. Gladstone at that table—a man who if he had to lay a tax of a farthing on the subject, would turn it over and over again in his brain, and when about it, would listen to you patiently, no matter what the hour of the day or night, and would take the fortune of the meanest subject of this realm into his great consideration. There is a large majority now, I quite agree, behind the Government. It makes an enormous difference in the way figures are handled, and in the way Statesmen behave on the Treasury Bench. I wonder sometimes they come into the House at all. Some of them do not, and I think they are quite right, having regard to the way their action is received by the present House of Commons.

1.0 A.M.

I now come to the estimates that have been formed. May I say that nobody was more pleased to see the Chancellor of the Exchequer achieve his great position than myself, and I feel sure that after he has had a little more experience he will regret this Budget. I cannot believe that any man, no matter how able, can jump in a year and six months to the great position which Mr. Gladstone once occupied. The Chancellor of the Exchequer has had a very arduous Session, and I greatly sympathise with him. Although I may think the right hon. Gentleman in some of his proposals is wrong, I recognise that at the bottom and foundation of his action there lie those considerations upon which he and I take common ground. I am not blaming his intentions or the spirit in which he carries out his duty, but I do say it is inevitable when a Minister comes for the first time into a great position he falls absolutely into the hands of the officials. Who made all these prophecies? Who made these estimates? The right hon. Gentleman himself a year or two ago would not have ventured to have made such prophecies as he has now made. At any rate what he has prophesied, as I understand it, is that there will be an increased yield for the year of £1,900,000. That was a prophecy in which he must have been assisted by someone. Has he forgotten Sir Michael Hicks-Beach's statement that taxation on whisky had reached the highest point, and that was at a time when he was putting this tax on as a war tax? What war tax are you going to raise in Ireland when you have exhausted these duties? Will you tax bread and salt and stirabout? I say that unless you can justify this as a war tax there is no justification for it; and as a war tax where would you be if, relying on an extra yield of £1,600,000 for the production of armaments and pay of men, you find instead of that additional yield you get a loss of £1,700,000. Grattan once said: "You cannot argue with a prophet; you can only contradict him." But here you have the prophet falsified. It is a strange thing that the falsification of the prophecy of the right hon. Gentleman takes place in England. Let me ask this—suppose your tax were on wine, and you carefully avoided taxing whisky? The Secretary to the Treasury says that he is sure that his hon. Friends below the Gangway would be very pleased if whisky should cease to be drunk. Have any of them drunk a bottle of champagne themselves? It is pretended that the poor man's liquor may be attacked, and that the rich man's liquor may be left untouched. You treat the Budget as though it were a sacrament of reconciliation, some incense you offer on the altar of morality. I think it was Artemus Ward who displayed his moral waxworks. This is a moral Budget. Suppose this were a tax on wine, and that a friendly Government in France—where, remember, there was recently, owing to the exactions and mistakes of the Central Government, something almost like a revolution in the wine country—supposing that the French Government were able to show that England, her largest customer, had practically brought about the destruction of the wine-growing industry in the Gironde or other wine districts of France, what remonstrances would come to the Treasury from the French Ambassador! You are taking up one little manufacture which your laws have left to Ireland—and you have left in many places nothing but ruin—and what is going to happen? I have a distillery in my district. For twenty years it has not paid its way, and the consequence of this Budget will be to starve out something like a hundred families. These people and their fate will not affect England. Should the distillery of Persse of Galway come to an end there would not be a ripple of feeling throughout all broad England on the subject. When distilleries in Ireland are destroyed, the work will be gone, the capital gone, the factory gone, the machinery sold, and you never can resuscitate the distilleries. Remember that these are old trades which have lasted for hundreds of years, and that each distillery has its special secrets—it was a question of moment at one time whether the excellence of the article was due to brewing, distilling, purchasing of grain, or mashing—all these things, to which generations of men for hundreds of years have given their time, you propose for your miserable necessities of the moment to wipe out and to send the manufacturers abroad to America or Australia. And why? On the prophesy, the false prophesy, of the Chancellor of the Exchequer that he may get more money. And if he does not, what will the explanation he-will give be? "Oh, it was the month of April"; "it was withdrawals"; "it was the March hares of March," or some other futile consideration. Why had not such explanations been substantiated by the production of the figures of withdrawals? The Secretary to the Treasury said that the figures will be supplied in due time by the Chancellor of the Exchequer. I look back to the day of Mr. Gladstone's Government.

In June, 1885, this House was packed and excited, it was a Debate in June; many Members found themselves unable to come beyond the Bar, and it was all on the question of putting a sixpence on whisky. On this question Mr. Gladstone's Government was hurled out of Office. The Government of that day were able to take up the question in June, the present Government are only able to take it up in September. In the long period of delay some people thought that the Chancellor of the Exchequer was going to drop the tax, while others relied upon a General Election. I believed, from all I read in the Irish Press of the efficacy of what is called judicious negotiation, that the Chancellor of the Exchequer was going to yield. I have been waiting here for a considerable time to see when the concessions to Ireland are going to be given. On every Clause you hear that there is going to be some concession made to Ireland. Now we are at Clause 61, and when is the concession to Ireland going to come? The extraordinary thing about it is that the Chancellor of the Exchequer, who is the responsible Minister, delegates his refusal to—I hope it is not offensive to say so—to an underling who came down flat-footed and said, "I am thinking imperially; I refuse to-give this foreign beer any concession; and the Chancellor of the Exchequer and Mr. Bung will say ditto." At what special date did the Treasury Moses strike the rock? Remember that you are racking the tax out of the people who are expected to sell this commodity and to pay you more money for the right to sell it, although by your own confession they have sold millions of gallons less than you expected. So that not only is the consumer to be charged extra for the product, but the vendor of the product is to pay a higher Licence Duty for selling less of the article. I am not going into the question of the difference between Scotland and England and Ireland.

I say Ireland cannot stand it. I am satisfied Ireland cannot stand this tax. I leave aside the question that we shall not, practically speaking, get any benefit out of this tax. If England gets some benefit and Scotland gets some benefit (I suppose Rosyth will cost the taxpayers some millions of money), where do we stand? At any rate, some advantage goes to Great Britain. Oh! it is sickening. You will not find an Irish Member who in relation to old age pensions said one word on the subject. You will find that the attitude which we took up on old age pensions was most careful and guarded. And when you brought in the Old Age Pensions Bill it was said that you had stripped our clothes to pay for them. I am not going now into the comparative benefits to the various countries. But I would point out that a man in England pays twopence for a glass of beer and has three halfpennyworth of manufactured value, the Government getting one halfpenny; but if a man gets two pennyworth of whisky in Ireland, the Government gets 1½d. and he gets only ½d. But I refuse to argue the case by these considerations. I say you have bled Ireland white in point of taxation, and you, remember, profess to be the Party which stood by Mr. Gladstone's Royal Commission which 15 years ago gave a solemn decision that Ireland was paying three millions too much. And it is on the top of this and in face of that decision that your so-called Home Rule Ministry and by a Minister we used to count among our friends put this iniquity upon us.

I think it is very much to be regretted that a tax of this kind should be discussed at this hour of the morning. I am bound to say that I am disappointed that the right hon. Gentleman has resolved to take this Clause up at such a late hour. I say so as the Member for a constituency which contains no less than 23 distilleries, the proprietors and others attached to which are extremely concerned about this tax, whose future welfare depends on the manner the right hon. Gentleman deals with it, and who will be unable to read a single word of this Debate to-morrow, for it is not likely to be reported in the Scottish papers. Their representative, I think, is entitled to complain of the action taken by the Government. I have duplicated on the Paper the Amendment of my hon. Friend the Member for Hammersmith (Sir W. Bull) to reduce this proposed tax to 1s., because I am perfectly convinced that not only will the Revenue greatly suffer by the extent of the imposition proposed, but that my constituents will very greatly suffer; and seeing the position of affairs, I think it a very sad and serious thing that burdens should be put upon the shoulders of these unfortunate people who happen to be distillers in Scotland.

I think the object of the Chancellor of the Exchequer is far more likely to be achieved if he were to reduce the tax. After all, this is not a temperance measure. It is difficult to believe, no doubt, but it is a Finance Bill, though there are many peculiarities about it. Therefore, as this is a Finance Bill, and we are not now-dealing with the Question from any moral point of view, I believe the normal flow of trade could possibly be restored if something like an extra 1s. were asked for instead of the 3s. 9d. which the Chancellor of the Exchequer proposes. Even if the Chancellor of the Exchequer were to say he will reduce the tax at the end of the year, I do not think it will make an atom of difference in the withdrawals from bond between now and March 31st There is a general feeling that some sensible Chancellor of the Exchequer after an election will practically restore things. I have been interested in reading the speeches of the right hon. Gentlemen opposite, particularly those of the President of the Board of Trade, who I am sorry to see has gone to bed. He has told his audience on every occasion that the Budget puts no tax on industry. I wish he would go on an excursion with me to Campbeltown and stand up on a platform in Campbeltown and say that the Budget places no tax on industry. I should be sorry for his skin if he did so. There is an unfortunate pressure about what is proposed. These people are attacked, most seriously attacked, by this tax. They depend wholly or almost wholly on the distilling industry for a livelihood. It is not expected that a single gallon of whisky will be made there this winter. Of course there are large stocks in the country, but there are no orders coming in, and there will be no employment for these 6,000 or 7,000 people. There is nothing they can look to. They live down in the Mull of Kintyre, far removed from the other parts of Scotland, except by steamer communication. These people cannot go into any other trade, and there is no casual labour for them, and they have a miserable winter to which to look forward, all because the Chancellor of the Exchequer has made a mistake and proposed to put on this tax, which has stopped all the demand, and ruined this trade, at any rate for the time being, and I doubt whether it will ever be able to recover its former position. The Financial Secretary to the Treasury, in making a case for the tax, said that the falling off was due to anticipation of the increased duty. I have dealt already with that. The right hon. Gentleman also said that the reason why the heavy tax was imposed was this: that if a light tax had been imposed, dilution would be practised, and the Treasury would not have got their money. That probably was true enough some years ago, and it would have been a good enough argument before the tax was raised to 11s., but since that time whisky has been and is now sold in public-houses all over the country at something so closely approaching the minimum standard which is allowed by law to be sold, that it is impossible to further dilute it. The right hon. Gentleman, the Secretary to the Treasury, ought to have known that. If he had consulted the Board of Inland Revenue they would have told him that whisky is now sold 24 under proof, and that the law forbids it being sold at less than 25 under proof. That was the position enacted by Sir Michael Hicks-Beach when he was Chancellor of the Exchequer, and I submit it is not now possible to depart from it. The fact is very well known to the Inland Revenue, and they ought to have informed the Treasury of it. The hon. Member for Inverness (Sir J. Dewar) ended by giving the Chancellor of the Exchequer some extremely bad advice. He told him he ought to have raised this money from beer, and he also said that beer was increasing in consumption, while that of whisky was decreasing. I cannot understand where the hon. Member got his figures from. Does he not know that the consumption of beer decreased last year by more than 1,000,000 barrels—I think the exact figure was 1,100,000? Even last month, although it is said that breweries have benefited by the Whisky Tax, the duty received was reduced by £130,000 or £140,000 in comparison with the corresponding month last year. Once bitten is twice shy, and I do not think that the Chancellor of the Exchequer, with the painful experience he has had of taxing an article falling in consumption, is likely to go to another which is falling equally in order to obtain further sums for the Treasury. Even the right hon. Gentleman has too much wisdom for that, and I do not think he will try that game. Therefore, I do not think the advice the hon. Member for Inverness (Sir J. Dewar) gave will be accepted.

I appeal to the Chancellor of the Exchequer, even at this late moment, to reconsider this tax. I believe that if he could see his way to contemplate a certain loss by reducing this impost to 1s., and if he would study the trade—for they are perfectly willing to bear their share of the burden—there would be little chance of the duty being reduced in the next Parliament, and there would only be the ordinary withdrawals from bond instead of that hand to mouth withdrawal which is certain to take place and which will seriously affect the Revenue up to the end of the financial year. It will not only help the Treasury by conceding this moderate tax, but it will also give the licence holder the advantage he is entitled to, namely, to charge an advance of a certain sum in order to pay the new Licence Duty, a prospect now denied to him if he cannot sell whisky at a profit. The right hon. Gentleman, by taking the course I have suggested, will also do a service to the publican and some good to distillers in the North of Scotland, those who depend upon them, and those who grow barley. The barley grown in the north, in Morayshire for instance, cannot be sold there and will have to be sold in the south. This will no doubt help the brewers over the three-penny stile which the right hon. Gentleman has erected, but it will mean a loss to the farmer. Take it which way you like and look where you please, the tax will do the Scottish distilling trade and the agricultural industry great disservice. It will not yield an income to the Treasury, and from all points of view the proposal seems to me to be extremely bad and unfortunate.

We have heard various reasons adduced in speeches and in conversations why Ireland should support this Clause. It is said that if we are in favour of temperance it is our duty to support this Clause. I may mention in passing that even the most extreme advocates of temperance in Ireland are, as a body, opposed to this unjust taxation. I have heard the argument used inside and outside this House that Ireland has derived such immense advantage from old age pensions that it is only just and right that she should contribute to the fund. I believe that is a most fallacious argument. We have again and again endeavoured to state the poverty of our country in this House. It is not a pleasant task for an Irish Member to do it, but we have to do it. I consider the very size of the sum which has come to Ireland for Old Age Pensions is a great corroboration of the statements we have made, and ought to be a proof to the Government of the intense poverty that exists in the country. So far from justifying the imposition of additional taxes on Ireland, I think the appalling poverty which the administration of the Old Age Pensions Act has proved should urge the Government to deal in a more lenient and more just way with us than they propose to do. I believe that the sum that comes into Ireland would be larger than it is were it not for the non-registration of births. There are hundreds and thousands who should be in receipt of old age pensions who have been cut off through the legislation of this House. Let us look at the matter from another point of view. In the admirable speech delivered by the hon. Member for the Scotland Division of Liverpool (Mr. T. P. O'Connor) he pointed out that the effects of the tax are far-reaching, and that it will reduce the area of the country under tillage. I wish Sir Edward Clarke were here in this House. He was a distinguished Member of it, and I remember hearing him deliver speeches on the subject of taxation in England as compared with that in Ireland, and he proved that in England the consumption per head was £4 2s., and the taxation levied was only 15s. 6d. per head, but that while the consumption in Ireland was only £2 13s. per head we contributed 13s. 6d. per head. This tax is imposed on one of the few remaining industries you have not crushed out of existence. By the action you are taking to-night I believe you will kill that industry. I remember very well that when the extra 6d. was put on whisky it was predicted that it would begin the process of killing the industry, and I think that the figures that have been published show that you have already taxed whisky too much, and that this extra tax is not only going to kill an industry, but that it will not bring in a farthing of the sum expected from it.

In the course of the Debate we have heard a good deal about the effect of this tax upon the distiller, but very little has been said about the injustice which it does to the consumer of whisky. The tax proposes to take out of the pockets of the consumers of whisky a sum of £1,600,000 in addition to the enormous sum of £21,000,000 a year already levied on spirits. That is to say, it proposes to increase the £21,000,000 to no less than £23,000,000. Who are the principal consumers of spirits, upon whom, be it remembered, this additional burden will fall? It is no reflection upon the working classes to say that they are the principal consumers of whisky, and whisky forms a very large proportion of the spirits which are taxed to the enormous extent I have indicated. If they are the consumers—a fact which nobody will dispute—they are the people who are asked to pay this taxation. I maintain that it is a manifest injustice to ask the working classes to contribute this enormously increased amount of taxation in respect of the alcohol they consume, especially as the burden they have to bear in connection with the old taxation is already very heavy.

I remember that in May last, when the Resolution in regard to the tax was under discussion in this House, the Prime Minister made an extraordinary admission. He said that the publican, the retailer of spirits, could recoup himself for the extra tax in one or two ways. He could add to the dilution, which was already allowed by law, and in that way he could take the tax off the consumer. The Prime Minister added that he was informed the publicans had done this deliberately, and were making an increased profit of £4,000,000. If you add that £4,000,000 to the £1,600,000, you arrive at the result that the working classes will be called upon to pay £5,600,000 more as the result of this tax alone. A statement of that kind, even when repeated some months after it was made, deserves attention, and I ask the Chancellor of the Exchequer whether it is a fact that in addition to the £1,600,000 which he expects to get for the revenue the publicans will be able further to tax the consumers to the extent of £4,000,000. The matter is very serious, and I commend it to the attention of the Labour Members, who ought to back me up in the demand I am making for an explanation. I do not expect they will do so, because they are bound hand and foot to the Government. They must recollect, however, that this question can be raised in the country, and, as a matter of fact, has been raised already. Depend upon it, the consumers who are called upon to pay this enormous amount of extra taxation are people with votes, and when they have an opportunity to exercise those votes they will not forget this impost. It is very significant that every penny of this £1,600,000 which the Chancellor of the Exchequer expects to get from the addition to the tax will be collected in the current year. The Chancellor of the Exchequer has told us that next year he expects to raise upwards of £2,000,000. I would point out that the Government are proposing to spend £2,000,000 on the valuation of land, and it will bring in during this financial year probably only £50,000. I maintain, therefore, that the proposal as regards the tax we are now discussing is a gross injustice on the working classes as compared with the burden on the other classes who are proposed to be taxed in regard to their ownership of land. The latter class are not called upon this year to pay an amount anything like equivalent to that which is to be extracted from the consumers of whisky and is therefore to be taken directly out of the pockets of the working men. The matter is one of extreme importance to some of the poorest people in the country.

If it is immoral to drink whisky it is folly to think that you can make it

Division No. 721.]

AYES.

[1.40 a.m.

Agnew, George WilliamEvans, Sir Samuel T.Newnes, F. (Notts, Bassetlaw)
Allen, A. Acland (Christchurch)Everett, R. LaceyNorman, Sir Henry
Allen, Charles P. (Stroud)Ferguson, R. C. MunroNussey, Sir Willans
Ashton, Thomas GairFiennes, Hon. EustaceNuttall, Harry
Balfour, Robert (Lanark)Findlay, AlexanderParker, James (Halifax)
Barker, Sir JohnFuller, John Michael F.Partington, Oswald
Barran, Sir John N. (Hawick B.)Gibson, James PuckeringPaulton, James Mellor
Barry, Redmond J. (Tyrone, N.)Gulland, John W.Pearce, Robert (Staffs, Leek)
Benn, W. (Tower Hamlets, St. Geo.)Harcourt, Robert V, (Montrose)Pickersgill, Edward Hare
Bennett, E. N.Harmsworth, R. L. (Caithness-shire)Pirie, Duncan V.
Bowerman, C. W.Haworth, Arthur A.Pointer, Joseph
Brodie, H. C.Hedges, A. PagetPollard, Dr.
Burns, Rt. Hon. JohnHelme, Norval WatsonPonsonby, Arthur A. W. H.
Buxton, Rt. Hon. Sydney CharlesHerbert, Col. Sir Ivor (Mon., S.)Rea, Rt. Hon. Russell (Gloucester)
Carr-Gomm, H. W.Higham, John SharpRea, Walter Russell (Scarborough)
Channing, Sir Francis AllstonHobhouse, Rt. Hon. Charles E. H.Rees, J. D.
Churchill, Rt. Hon. Winston S.Holt, Richard DurningRichards, T. F. (Wolverhampton)
Clough, WilliamHorniman, Emslie JohnRoberts, Charles H. (Lincoln)
Cobbold, Felix ThornleyJones, Leif (Appleby)Robinson, S.
Collins, Stephen (Lambeth)Jones, William (Carnarvonshire)Robson, Sir William Snowdon
Collins, Sir Wm. J. (St. Pancras, W.)King, Alfred John (Knutsford)Roch, Walter F. (Pembroke)
Cooper, G. J.Lamont, NormanRogers, F. E. Newman
Corbett, A. Cameron (Glasgow)Levy, Sir MauriceRussell, Rt. Hon. T. W.
Corbett, C. H. (Sussex, E. Grinstead)Lloyd-George, Rt. Hon. DavidRutherford, V. H. (Brentford)
Cory, Sir Clifford JohnLough, Rt. Hon. ThomasSamuel, Rt. Hon. H. L. (Cleveland)
Craig, Herbert J. (Tynemouth)Lupton, ArnoldSamuel, S. M. (Whitechapel)
Crosfield, A. H.Maclean, DonaldScarisbrick, Sir T. T. L.
Duncan, C. (Barrow-in-Furness)M'Laren, H. D. (Stafford, W.)Seely, Colonel
Duncan, J. H. (York, Otley)Markham, Arthur BasilStanley, Hon. A. Lyulph (Cheshire)
Dunne, Major E. Martin (Walsall)Marnham, F. J.Summerbell, T.
Edwards, Sir Francis (Radnor)Massie, J.Thorne, G. R. (Wolverhampton)
Elibank, Master ofMiddlebrook, WilliamTomkinson, James
Essex, R. W.Murray, Capt. Hon. A. C. (Kincard.)Toulmin, George

more moral by increasing taxation. If it is immoral, it is not the duty of the Government to tax it to a greater extent, but to do away with it altogether. The very fact that the Government recognise the traffic in liquor as legitimate justifies those who consume it in saying that they ought not to take this particular article and put such an enormous amount of taxation upon it. If the Government had introduced a corresponding tax on the rich man's wine there might have been some justification for the course they have adopted. But whilst they are taxing the working men to this enormous extent they have not had the courage to put a corresponding duty on the wines consumed by the richer classes. I shall not be surprised if I do not receive from the Chancellor of the Exchequer the explanation I desire, because whenever I ask the right hon. Gentleman for any figures he seems to know nothing about the matter, and when the right hon. Gentleman is not in the House, those he loaves in charge of the Bill seem equally ignorant.

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

Question put, "That the Question be now put."

The Committee divided: Ayes, 112; Noes, 95.

Verney, F. W.White, Sir George (Norfolk)Wood, T. M'Kinnon
Ward, W. Dudley (Southampton)White, J. Dundas (Dumbartonshire)
Waring, WalterWhite, Sir Luke (York, E. R.)TELLERS FOR THE AYES.—Mr. Joseph Pease and Sir Edward Strachey.
Warner, Thomas Courtenay T.Wilkie, Alexander
Wason, John Cathcart (Orkney)Williams, J. (Glamorgan)
Watt, Henry A.Wilson, W. T. (Westhoughton)

NOES.

Abraham, William (Cork, N. E.)Gretton, JohnMurphy, John
Acland-Hood, Rt. Hon. Sir Alex, F.Guinness, Hon. R. (Haggerston)Nannetti, Joseph P.
Arkwright, John StanhopeGwynn, Stephen LuciusNewdegate, F. A.
Balcarres, LordHaddock, George B.Nicholson, Wm. G. (Petersfield)
Banbury, Sir Frederick GeorgeHamilton, Marquess ofNolan, Joseph
Banner, John S. Harmood-Hardy, Laurence (Kent, Ashford)O'Brien, Patrick (Kilkenny)
Beckett, Hon. GervaseHarris, Frederick LevertonO'Connor, John (Kildare, N.)
Boland, JohnHarrison-Broadley, H. B.O'Connor, T. P. (Liverpool)
Brotherton, Edward AllenHazleton, RichardO'Kelly, Conor (Mayo, N.)
Bull, Sir William JamesHealy, Maurice (Cork)Pease, Herbert Pike (Darlington)
Campbell, Rt. Hon. J. H. M.Healy, T. M. (Louth, North)Power, Patrick Joseph
Carlile, E. HildredHill, Sir ClementRatcliffe, Major R. F.
Castlereagh, ViscountHope, James Fitzalan (Sheffield)Roddy, M.
Cecil, Evelyn (Aston Manor)Hunt, RowlandRenton, Leslie
Chamberlain, Rt. Hon. J. A. (Worc.)Joyce, MichaelRenwick, George
Clancy, John JosephKeating, MatthewRonaldshay, Earl of
Clive, Percy ArcherKilbride, DenisRutherford, Watson (Liverpool)
Clyde, James AvonKing, Sir Henry Seymour (Hull)Sheehy, David
Coates, Major E. F. (Lewisham)Lockwood, Rt. Hon. Lt.-Col. A. R.Smith, Abel H. (Hertford, East)
Cochrane, Hon. Thomas H. A. E.Long, Rt. Hon. Walter (Dublin, S.)Stanier, Beville
Condon, Thomas JosephLowe, Sir Francis WilliamStarkey, John R.
Courthope, G. LoydLundon, ThomasThomson, W. Mitchell- (Lanark)
Craig, Captain James (Down, E.)Lynch, Arthur Alfred (Clare, W.)Walker, Col. W. H. (Lancashire)
Craik, Sir HenryMacNeill, John Gordon SwiftWarde, Col. C. E. (Kent, Mid)
Cullinan, J.MacVeagh, Jeremiah (Down, S.)White, Patrick (Meath, North)
Devlin, JosephMacVeigh, Charles (Donegal, E.)Williams, Col. R. (Dorset, W.)
Dewar, Sir J. A. (Inverness-shire)M'Kean, JohnWilliamson, Sir Archibald
Dickson, Rt. Hon. Charles ScottMason, James F. (Windsor)Wortley, Rt. Hon. C. B. Stuart-
Douglas, Rt. Hon. A. Akers-Meagher, MichaelYounger, George
Duffy, William J.Mooney, J. J.
Faber, Capt. W. V. (Hants, W.)Morpeth, ViscountTELLERS FOR THE NOES.—Viscount Valentia and Mr. Forster.
Fell, ArthurMorrison-Bell, Captain
Foster, Philip S. (Warwick, S. W.)Muidoon, John

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

Division No. 722.]

AYES.

[1.45 a.m.

Agnew, George WilliamElibank, Master ofMarkham, Arthur Basil
Allen, A. Acland (Christchurch)Essex, R. W.Marnham, F. J.
Allen, Charles P. (Stroud)Evans, Sir S. T.Massie, J.
Ashton, Thomas GairEverett, R. LaceyMiddlebrook, William
Balfour, Robert (Lanark)Ferguson, R. C. MunroMurray, Capt. Hon. A. C. (Kincard.)
Barker, Sir JohnFiennes, Hon. EustaceNewnes, F. (Notts, Bassetlaw)
Barran, Sir John NicholsonFindlay, AlexanderNorman, Sir Henry
Barry, Redmond J. (Tyrone, N.)Fuller, John Michael F.Nussey, Sir Willans
Benn, W. (Tower Hamlets, St. Geo.)Gibson, J. P.Nuttall, Harry
Bennett, E. N.Gulland, John W.Parker, James (Halifax)
Bowerman, C. W.Harcourt, Robert V. (Montrose)Partington, Oswald
Brodie, H. C.Harmsworth, Cecil B. (Worcester)Paulton, James Mellor
Burns, Rt. Hon. JohnHarmsworth, R. L. (Caithness-shire)Pearce, Robert (Staffs, Leek)
Buxton, Rt. Hon. Sydney CharlesHaworth, Arthur A.Pickersgill, Edward Hare
Carr-Gomm, H. W.Hedges, A. PagetPirie, Duncan V.
Channing, Sir Francis AllstonHelme, Norval WatsonPointer, J.
Churchill, Rt. Hon. Winston S.Herbert, Col. Sir Ivor (Mon., s.)Pollard, Dr. G. H.
Clough, WilliamHigham, John SharpPonsonby, Arthur A. W. H.
Cobbold, Felix ThornleyHobhouse, Rt. Hon. Charles E. H.Rea, Rt. Hon. Russell (Gloucester)
Collins, Stephen (Lambeth)Holt, Richard DurningRea, Walter Russell (Scarborough)
Collins, Sir Wm. J. (St. Pancras, W.)Horniman, Emslie JohnRees, J. D.
Cooper, G. J.Jones, Leif (Appleby)Richards, T. F. (Wolverhampton, W.)
Corbett, A. Cameron (Glasgow)Jones, William (Carnarvonshire)Roberts, Charles H. (Lincoln)
Corbett, C. H. (Sussex, E. Grinstead)King, Alfred John (Knutsford)Robinson, S.
Cory, Sir Clifford JohnLamont, NormanRobson, Sir William Snowdon
Craig, Herbert J. (Tynemouth)Levy, Sir MauriceRoch, Walter F. (Pembroke)
Crosfield, A. H.Lloyd-George, Rt. Hon. DavidRogers, F. E. Newman
Duncan, C. (Barrow-in-Furness)Lough, Rt. Hon. ThomasRussell, Rt. Hon. T. W.
Duncan, J. Hastings (York, Otley)Lupton, ArnoldRutherford, V. H. (Brentford)
Dunne, Major E. Martin (Walsall)Maclean, DonaldSamuel, Rt. Hon. H. L. (Cleveland)
Edwards, Sir Francis (Radnor)M'Laren, H. D. (Stafford, W.)Samuel, S. M. (Whitechapel)

The Committee divided: Ayes, 112; Noes, 94.

Scarisbrick, Sir T. T. L.Ward, W. Dudley (Southampton)Williams, J. (Glamorgan)
Seely, ColonelWarner, Thomas Courtenay T.Wilson, W. T. (Westhoughton)
Stanley, Hon. A. Lyulph (Cheshire)Wason, John Cathcart (Orkney)Wood, T. M'Kinnon
Summerbell, T.Watt, Henry A.
Thorne, G. R. (Wolverhampton)White, Sir George (Norfolk)
Tomkinson, JamesWhite, J. Dundas (Dumbartonshire)TELLERS FOR THE AYES.—Mr. Joseph Pease and Sir E. Strachey.
Toulmin, GeorgeWhite, Sir Luke (York, E. R.)
Verney, F. W.Wilkie, Alexander

NOES.

Abraham, W. (Cork, N. E.)Gretton, JohnMurphy, John (Kerry, E.)
Acland-Hood, Rt. Hon. Sir Alex. F.Guinness, Hon. R. (Haggerston)Nannetti, Joseph P.
Arkwright, John StanhopeGwynn, Stephen LuciusNewdegate, F. A.
Balcarres, LordHaddock, George B.Nicholson, Wm. G. (Petersfield)
Banbury, Sir Frederick GeorgeHamilton, Marquess ofNolan, Joseph
Banner, John S. Harmood-Hardy, Laurence (Kent, Ashford)O'Brien, Patrick (Kilkenny)
Beckett, Hon. GervaseHarris, Frederick LevertonO'Connor, John (Kildare, N.)
Boland, JohnHarrison-Broadley, H. B.O'Connor, T. P. (Liverpool)
Brotherton, Edward AllenHazleton, RichardO'Kelly, Conor (Mayo, N.)
Campbell, Rt. Hon. J. H. M.Healy, Maurice (Cork)Pease, Herbert Pike (Darlington)
Carlile, E. HildredHealy, Timothy MichaelPower, Patrick Joseph
Castlereagh, ViscountHill, Sir ClementRatcliff, Major R. F.
Cecil, Evelyn (Aston Manor)Hope, James Fitzalan (Sheffield)Reddy, M.
Chamberlain, Rt. Hon. J. A. (Worc'r.)Hunt, RowlandRenton, Leslie
Clancy, John JosephJoyce, MichaelRenwick, George
Clive, Percy ArcherKeating, MatthewRonaldshay, Earl of
Clyde, J. AvonKilbride, DenisRutherford, Watson (Liverpool)
Coates, Major E. F. (Lewisham)King, Sir Henry Seymour (Hull)Sheehy, David
Cochrane, Hon. Thomas H. A. E.Lockwood, Rt. Hon. Lt.-Col. A. R.Smith, Abel H. (Hertford, East)
Condon, Thomas JosephLong, Rt. Hon. Walter (Dublin, S.)Stanier, Beville
Courthope, G. LoydLowe, Sir Francis WilliamStarkey, John R.
Craig, Captain James (Down, E.)Lundon, T.Thomson, W. Mitchell- (Lanark)
Craik, Sir HenryLynch, A. (Clare, W.)Valentia, Viscount
Cullinan, J.MacNeill, John Gordon SwiftWalker, Col. W. H. (Lancashire)
Devlin, JosephMacVeagh, Jeremiah (Down, S.)Warde, Col. C. E. (Kent, Mid)
Dewar, Sir J. A. (Inverness-shire)MacVeigh, Charles (Donegal, E.)White, Patrick (Meath, North)
Dickson, Rt. Hon. C. ScottM'Kean, JohnWilliams, Col. R. (Dorset, W.)
Douglas, Rt. Hon. A. Akers-Mason, James F. (Windsor)Wortley, Rt. Hon. C. B. Stuart-
Duffy, William J.Meagher, Michael
Faber, Capt. W. V. (Hants, W.)Mooney, J. J.
Fell, ArthurMorpeth, ViscountTELLERS FOR THE NOES.—Sir
Forster, Henry WilliamMorrison-Bell, CaptainW. Bull and Mr. Younger.
Foster, P. S.Muldoon, John

proposed, "That the Chairman report Progress, and ask leave to sit again."

I do so partly because of the lateness of the hour, and partly because the Financial Secretary to the Treasury gave a definite and deliberate pledge in the course of the Debate on the last Amendment, a pledge which there has been no attempt made to keep. The Chancellor of the Exchequer was not in the House when the discussion was taking place upon an Amendment which vitally affects not only Ireland but Scotland and England as well. In view of the way we have been treated in that respect, and of the fact that the Financial Secretary to the Treasury promised that the Chancellor of the Exchequer would reply to the points raised, and give us figures on which he contradicted us; and that the only contribution to the Debate we have, in fact, got from the Chancellor of the Exchequer, was his Motion that the Question be now put—under all these circumstances I think we have no option whatever but to propose, as I now do, that you report Progress and ask leave to sit again.

I was not aware that my right hon. Friend had promised that I should take part in the Debate, if I had known I should have certainly intervened. I very much regret that I did not know that the promise was given. As to the figures, I assumed that they were asked for, and I sent them across the floor by one of my friends on this Bench. I regret that there has been a misunderstanding, but, at any rate, the Clause is not yet disposed of, and the figures will be relevant to any part of the discussion on it. When I take part in the discussion on the Clause I can give the figures. I very much regret that I was not aware of the statement which was made on my behalf.

2 A.M.

Of course, everybody will accept without hesitation the statement of the Chancellor of the Exchequer. He was not aware of the promise made and he will not be surprised, nor will the Committee, if we draw attention to the extraordinary difficulty under which we are asked to debate the Bill. A Minister who occupies the responsible position held by the Secretary to the Treasury, who is always understood to be the right hand man of the Chancellor of the Exchequer, tells the Committee that he is unable to meet the demand made to him for the production of some figures dealing with a point in very active dispute. In answer to the demand all he could say was that the Chancellor of the Exchequer would produce the figures and take part in the Debate. It is an amazing thing that that statement should have been made on behalf of the Government, and that the Minister in charge of the Bill should not have been told that this promise had been made on his behalf. There will be no desire or attempt to refuse to accept the personal assurance of the Chancellor of the Exchequer, but I think we are entitled to complain that when we are discussing, as we were discussing, a most important Amendment to a most important Clause, that the right hon. Gentleman should have thought it right to Closure the Debate, although he must have been aware that no one from this Bench had spoken—a fact which surely would have lead him to believe that we were expecting a fuller and more complete reply than we had received from the Secretary to the Treasury. I do not think anybody will accuse me of bitter language when I say that the reply the Secretary to the Treasury made to the demand for fairer treatment on this part of the financial proposals was inadequate. I think he himself will admit that he did not make a reply which could be thought convincing and adequate to the demands made. Surely it was known to the Government that the Debate opened up the whole question not only of the distilling trade but of the allied trades and of the great industry of agriculture. On behalf of the latter not one single speech has been made. Nobody spoke from this bench. Although we do not suggest that the Chancellor of the Exchequer was aware of the promise that had been made, we hope in future the Members of the Government will be more communicative with each other as to arrangements than on this occasion.

I accept the statement of the Chancellor of the Exchequer. What a position this puts Irish interests and Scottish interests in. This tax is absolutely unexampled. From the Budget point of view the Ministry do not think it worth while on the appeal made by Scotland or Ireland to put a Cabinet Minister up to state the case of the Government. After all, those of us who are foreigners here, take an interest in the procedure and in the past of this House. And I say is it not an extraordinary thing on the part of the Chancellor of the Exchequer that with regard to a tax affecting a vital interest and the question also of industry he should come down to this House, and having sought to justify a Budget tax of 3s. 9d. on whisky, he should say, "I do not intend to trouble about the Irish and Scotch case—I have got my majority"? But did he think he had only got a majority of 18? I venture to think that if the Chancellor of the Exchequer had thought that he had only a majority of 18, he would have talked till all was blue. That he did not intend to speak shows the amount of differential consideration that he gives to statements coming from the Irish party, which is so loyal in supporting the Government. (Laughter.) Well, I could not say I have supported him.

At least the gentlemen who have given the right hon. Gentleman loyal support throughout the Budget discussions were entitled to hear from the Chancellor of the Exchequer on behalf of the Ministry something different to the shambling statement of the Secretary to the Treasury. [HON. MEMBERS: "Oh."] Well, I find it very difficult to characterise it. That is my excuse. The right hon. Gentleman (Mr. Lloyd-George), has stated with accuracy—and I thank him for his courtesy—that he gave the figures with regard to the alleged forestalments. But was it in accordance with the spirit which usually obtains in this House, that when these statements had been sent across the floor of the House by messenger, and before they could be dealt with by the Members, the right hon. Gentleman should get up and move the Closure? If the Chancellor of the Exchequer will permit me, I will have the piece of paper which he sent over to these benches framed. I will hand down his piece of paper with a notification that it was handed across the floor by a Minister—the highest Minister after the Prime Minister—in reference to the most crushing tax ever imposed upon our country, and in compliance with a promise which an underling gave, and which was broken, and in reference to figures which unless they were intended as an insult must have been intended for the purposes of debate. I will also record the fact that the Minister who handed these figures to a man who, at all events, was greatly interested on behalf of his country, within half a minute put the garotte on the man to whom he gave them.

Division No. 723.]

AYES.

[2.7 a.m.

Abraham, W. (Cork, N. E.)Guinness, Hon. R. (Haggerston)Newdegate, F. A.
Acland-Hood, Rt. Hon. Sir Alex. F.Gwynn, Stephen LuciusNicholson, Wm. G. (Petersfield)
Arkwright, John StanhopePaddock, George B.Nolan, Joseph
Balcarres, LordHamilton, Marquess ofO'Connor, John (Kildare, N.)
Banner, John S. Harmood-Hardy, Laurence (Kent, Ashford)O'Connor, T. P. (Liverpool)
Beckett, Hon. GervaseHarris, Frederick LevertonO'Kelly, Conor (Mayo, N.)
Banbury, Sir Frederick GeorgeHarrison-Broadley, H. B.Pease, Herbert Pike (Darlington)
Brotherton, Edward AllenHazleton, RichardPower, Patrick Joseph
Bull, Sir William JamesHealy, Maurice (Cork)Ratcliff, Major R. F.
Campbell, Rt. Hon. J. H. M.Healy, Timothy MichaelReddy, M.
Carlile, E. HildredHill, Sir ClementRenton, Leslie
Castlereagh, ViscountHope, James Fitzalan (Sheffield)Renwick, George
Cecil, Evelyn (Aston Manor)Hunt, RowlandRonaldshay, Earl of
Chamberlain, Rt. Hon. J. A. (Worc'r.)Joyce, MichaelRutherford, Watson (Liverpool)
Clancy, John JosephKeating, MatthewSheehy, David
Clive, Percy ArcherKilbride, DenisSmith, Abel H. (Hertford, East)
Clyde, J. AvonKing, Sir Henry Seymour (Hull)Stanier, Beville
Coates, Major E. F. (Lewisham)Lockwood, Rt. Hon. Lt.-Col. A. R.Starkey, John R.
Cochrane, Hon. Thomas H. A. E.Long, Rt. Hon. Waiter (Dublin, S.)Thomson, W. Mitchell- (Lanark)
Condon, Thomas JosephLowe, Sir Francis WilliamValentia, Viscount
Courthope, G. LoydLundon, ThomasWalker, Col. W. H. (Lancashire)
Craig, Captain James (Down, E.)Lynch, A. (Clare, W.)Warde, Col. C. E. (Kent, Mid)
Craik, Sir HenryMacNeill, John Gordon SwiftWaring, Walter
Cullinan, J.MacVeagh, Jeremiah (Down, S.)White, Patrick (Meath, North)
Devlin, JosephMacVeigh, Charles (Donegal, E.)Williams, Col. R. (Dorset, W.)
Dewar, Sir J. A. (Inverness-sh.)M'Kean, JohnWilliamson, Sir A.
Dickson, Rt. Hon. C. ScottMason, James F. (Windsor)Wilson, W. T. (Westhoughton)
Douglas, Rt. Hon. A. Akers-Meagher, MichaelWortley, Rt. Hon. C. B. Stuart-
Duffy, William J.Mooney, J. J.Younger, George
Faber, Capt. W. V. (Hants, W.)Morpeth, Viscount
Fell, ArthurMorrison-Bell, Captain
Forster, Henry WilliamMuldoon, JohnTELLERS FOR THE AYES.—Mr. Patrick O'Brien and Mr. Boland.
Foster, P. S.Murphy, John (Kerry, E.)
Gretton, JohnNannetti, Joseph P.

NOES.

Agnew, George WilliamEverett, R. LaceyNussey, Sir Willans
Allen, A. Acland (Christchurch)Ferguson, R. C. MunroNuttall, Harry
Allen, Charles P. (Stroud)Fiennes, Hon. EustaceParker, James (Halifax)
Ashton, Thomas GairFindlay, AlexanderPartington, Oswald
Balfour, Robert (Lanark)Fuller, John Michael F.Paulton, James Mellor
Barker, Sir JohnGibson, J. P.Pearce, Robert (Staffs., Leek)
Barran, Sir John NicholsonGulland, John W.Pickersgill, Edward Hare
Barry, Redmond J. (Tyrone, N.)Harcourt, Robert V. (Montrose)Pirie, Duncan V.
Benn, W. (Tower Hamlets, St. Geo.)Harmsworth, Cecil B. (Worcester)Pointer, J.
Bennett, E. N.Harmsworth, R. L. (Caithness-shire)Pollard, Dr. G. H.
Bowerman, C. W.Haworth, Arthur A.Ponsonby, Arthur A. W. H.
Brodie, H. C.Hedges, A. PagetRea, Rt. Hon. Russell (Gloucester)
Burns, Rt. Hon. JohnHelme, Norval WatsonRea, Walter Russell (Scarborough)
Buxton, Rt. Hon. Sydney CharlesHerbert, Col. Sir Ivor (Mon., S.)Rees, J. D.
Carr-Gomm, H. W.Higham, John SharpRichards, T. F. (Wolverhampton, W.)
Channing Sir Francis AllstonHobhouse, Rt. Hon. Charles E. H.Roberts, Charles H. (Lincoln)
Churchill, Rt. Hon. Winston S.Holt, Richard DurningRobinson, S.
Clough, WilliamHorniman, Emslie JohnRohson, Sir William Snowdon
Cobbold, Felix ThornleyJones, Leif (Appleby)Roch, Walter F. (Pembroke)
Collins, Stephen (Lambeth)Jones, William (Carnarvonshire)Rogers, F. E. Newman
Collins, Sir Wm. J. (St. Pancras, W.)King, Alfred John (Knutsford)Russell, Rt. Hon. T. W.
Cooper, G. J.Lamont, NormanRutherford, V. H. (Brentford)
Corbett, A. Cameron (Glasgow)Levy, Sir MauriceSamuel, Rt. Hon. H. L. (Cleveland)
Corbett, C. H. (Sussex, E. Grinstead)Lloyd-George, Rt. Hon. DavidSamuel, S. M. (Whitechapel)
Cory, Sir Clifford JohnLough, Rt. Hon. ThomasScarisbrick, Sir T. T. L.
Craig, Herbert J. (Tynemouth)Lupton, ArnoldSeely, Colonel
Crosfield, A. H.Maclean, DonaldStanley, Hon. A. Lyulph (Cheshire)
Duncan, C. (Barrow-in-Furness)M'Laren, H. D. (Stafford, W.)Summerbell, T.
Duncan, J. Hastings (York, Otley)Markham, Arthur BasilThorne, G. R. (Wolverhampton)
Dunne, Major E. Martin (Walsall)Marnham, F. J.Tomkinson, James
Edwards, Sir Francis (Radnor)Massie, J.Toulmin, George
Elibank, Master ofMiddlebrook, WilliamVerney, F. W.
Essex, R. W.Murray, Capt. Hon. A. C. (Kincard.)Ward, W. Dudley (Southampton)
Evans, Sir S. T.Mewnes, F. (Notts, Bassetlaw)Warner, Thomas Courtenay T.

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

The Committee divided: Ayes, 97; Noes, 110.

Wason, John Cathcart (Orkney)White, Sir Luke (York, E. R.)TELLERS FOR THE NOES.—Mr. Joseph Pease and Sir Edward Strachey.
Watt, Henry A.Wilkie, Alexander
White, Sir George (Norfolk)Williams, J. (Glamorgan)
White, J. Dundas (Dumbartonshire)Wood, T. M'Kinnon

moved at the end of the Clause to insert the words: "Provided that, if the spirits be of an age of not less than five years, the duty shall be two shillings per proof gallon, and if the spirit be under live but over three years' of age, the duty shall be two shillings and nine pence per proof gallon, the age of spirits that have been blended or vatted being taken to be the age of the youngest spirit in the blend or vat."

This Amendment will give the Chancellor of the Exchequer an opportunity to make some amends for not speaking on the other part of the Clause. I understand that the Chancellor of the Exchequer at one time looked with favour on this proposal, but if report be true his attitude has changed, because the distillers were not unanimous amongst themselves as to what they wanted. The proposal I have to make is this: That the right hon. Gentleman should continue to charge 14s. 9d. on the whisky that is new, and that he should give a reduction as the whisky gets older, the principle being that the tax on whisky five years old should be 13s., on whisky three years old 13s. 9d., and beyond that the higher rate. I am not wedded to the letter of my Amendment. What I want is that as the whisky gets older it should not be charged more duty. The Commission which sat to consider the question said it was not the quality but the quantity that made a man drunk. Old whisky is very good. The hon. Member for the Ayr Burghs (Mr. Younger) quoted the case of the two monkeys to prove that old whisky is better than new. Everybody must rely on his own experience, and everybody knows that old whisky is certainly more palatable. The amount that I suggest the Chancellor of the Exchequer should take in old whisky is just about the cost of maturing it in bond. The man who produces new whisky will suffer no injustice because it has not been subject to the extra cost of maturing. The 13s. 9d. which I propose should be charged will just bring the new whisky to the same price as the old whisky, and the result will be that the ordinary consumer will get the old whisky at the price of new whisky. The ordinary consumer at present has no chance of getting old whisky at the price of new, because the old whisky sold in the ordinary public-house is more or less new whisky.

If the Chancellor of the Exchequer accepts the Amendment, he will put the ordinary working man in the position of getting the same whisky as the man who is richer. The experiment is well worth trying. It will not result in any diminution of revenue; it will aid moral and temperate improvement; it will help distillers in the North of Scotland whose whisky requires more time to mature; and it inflicts no injustice on the whisky which matures more quickly.

My hon. Friend was quite right in assuming that I regard his proposal with a good deal of sympathy, and I may tell the committee I am very anxious that something of this kind should be done. But I found, in the first instance, that those who are engaged in the manufacture of whisky are very divided upon the subject. I will not say the majority of whisky distillers, but the whisky distillers who produce the largest quantity of spirits, were undoubtedly against it. A deputation representing both the Scotch and the Irish distillers waited upon me. I put the question to them, and I found at once that there was a division of opinion. I asked them to consider the matter, and to formulate proposals. A committee-room was placed at their disposal, but after discussing the matter I think they were still divided. More than half of them retired, and those who brought the report to me certainly did not represent anything like the majority of the whisky distillers of Scotland. I afterwards received a very strongly worded protest from the other distillers against accepting anything of this character. Since then the report of the Whisky Commission has been issued, and, so far as it goes, certainly it does not encourage this notion. Under the circumstances, therefore, I thought that on the whole my best plan was not to interfere. Those who are engaged in grain distilling resented the proposal very strongly, on the ground that it would give an unfair preference to one branch of the business as against the other. As my hon. Friend knows the Government were rather invited to take the side of one branch of the whisky trade as against the other branch. I confess that although I felt very willing to accept something on these lines at the outset, I came to the conclusion, more especially after the report of the Whisky Commission, that the Government could hardly take sides in a difference of opinion between the two sections of whisky distillers.

While I have a certain amount of sympathy with the Amendment, I agree with the Chancellor of the Exchequer that there is a division of interest in the matter. I would suggest that the Committee should adopt a new Clause which I have put on the Paper and which would place all the distillers on the same level. It would not allow any whisky to be used for potable purposes which had not been kept in bond for two years. I believe that among other good results a provision of that kind would put an end to the violent drunkenness which is the cause of so much crime, and which everybody so greatly deplores. It has been proved over and over again by scientific experiments that old whisky, although apparently exactly the same as new, has physiologically very different effects. Whisky distillers desire to see two years compulsory bonding, and I would remind the Committee that this was one of the recommendations of Lord Peel's Commission. As a Member of that Commission and as one who signed that recommendation, I thought it my duty to bring the matter up now at the first opportunity. If I am in order I shall move my new Clause later on, and I hope the Chancellor of the Exchequer will give it his favourable consideration. The only trouble is that it may not be regarded as exactly germane to a Finance Bill, but there are so many clauses in the Bill which are not germane to finance that I do not think I should be more out of order than is the Chancellor of the Exchequer himself in regard to some of the Clauses which he proposes to pass into law.

I can well understand that the Chancellor of the Exchequer found the distillers who distil from raw grain opposed to the scheme of graduation. The duty as proposed in the Finance Bill falls unequally upon the two classes of distillers, and we may disabuse our minds of any other idea on the point. It presses with exceptional severity on the distillers who distil from home-grown barley in the country districts of Scotland. Why do I say that? First of all, in order to get at the facts I wrote letters to every licensee in my Constituency to ask for information. The information I have from them does not show the figures relating to whisky despatched from bond in anticipation of a rise in the duty, or whisky not despatched from bond in anticipation of a fall, but the actual figures of sales over the counter to the consumer. These are more valuable than the figures which the Treasury have. These figures show that on the lowest estimate the falling off in the sales of whisky over the counter is 23 per cent. as compared with last year, and the figures run up as high as 50 per cent. Then I come to a point in which I am more interested. Let us analyse what these sales are. I asked every licensee, "What is your experience now under the Budget of the demand for the cheaper as compared with the better grades of whisky?" The answer I have received from 64 out of 65 licensees is that the demand is for the cheaper grade of whisky. Only one licensee replies that he does not find any difference in the demand and his is a special trade. The demand, therefore, let the Committee observe, is for the very cheapest class of whisky. Why do I say that this tax falls unequally on the two classes of distillers? Because in order to meet this demand for the cheapest class of whisky the vendor—

I think that has reference to the last Amendment. This is an Amendment as to the age of whisky.

I was going to bring my argument round to show that in buying a cheaper quality you buy a newer whisky. I submit, therefore, with all respect, that my argument is relevant. They buy the cheaper quality now. The cheaper quality is the whisky made from raw grain. The consumer buys more of the raw grain whisky and less of the whisky which is distilled in my Constituency, and which costs something like 3s. to 3s. 9d. to produce. Consequently the proposal of the Chancellor of the Exchequer falls unequally, and therefore I am in favour of a graduation which would tend to place the distillers who distil from barley more on an equality with those who distil from raw grain. There is another reason why one favours a graduation of the duty, and that is that the new whisky is not so good for the system as the older whisky is. Therefore the proposal would be good from the point of view of sobriety. The proposal of the Chancellor of the Exchequer would really tend to encourage the consumption of the more maddening forms of drink. Reference has been made to the Report of the Whisky Commission. That Report does not, I submit, condemn graduation. Moreover, the Commissioners did not make such very strong statements as we have been led to believe.

They said:—
"Most of the witnesses were of the opinion that old whisky was less deleterious to health than new whisky, and that this difference was more especially marked in the pot still product."
They further say that
"Furthermore it appears that pot still whiskies are regarded in the trade as still young at that age, and that it is advisable to store them in wood for additional periods."
The Report is not quite so opposed to this proposal as we are led to believe. Secondly, this Report is not at all at variance with graduation, although on practical grounds—and mark, these were the words used—they were opposed to compulsory bonding. Well, the practical difficulties no longer exist.

I am informed that if the Chancellor of the Exchequer decided to graduate the tax—as far as the needs of the revenue are concerned—there would be no difficulties in the way. Consequently, that may be put on one side. There is the other point as to whether old whisky or new whisky is injurious. I asked every one of the licensees in my constituency what, in their experience, was the effect on the consumer. This is a very important thing for the House to know. The vendors of this article said that it is their experience that new whisky acts very much more quickly on the system than the old. One writes that the after effects of new whisky would be worse than that of old. Another says, "New whisky is certainly more conducive to a quick drunk than those that are well matured." Another says, "Unquestionably new whisky is more conducive to drunkenness. It is amazing such a question is necessary." That is good evidence from the practical side. The recommendation of Lord Peel's Commission was a unanimous recommendation, and was not the recommendation of a Committee that was appointed to inquire into something else. It was appointed to consider whether it was a good thing for the country that whisky should be kept in bond. The fact is admitted with practical unanimity that "the effects of new Taw whisky are deleterious in a high degree, and without going into what fusel oil is, or how generated, we are satisfied of the superiority or of the less noxious effects of old as compared with new whisky; and we have set the evidence of those who speak from observation of the effects against the conclusive evidence of experts who speak with uncertainty or hesitation. Thus, balancing this testimony offered on the one side and on the other, we cannot refuse our concurrence with those who advocate a period of compulsory bonding." There is no doubt new whisky is bad for the consumer, and that it gives a more maddening consequence. The Chancellor of the Exchequer has now an opportunity for doing a great deal in favour of temperance and sobriety, and I hope he will avail himself of the opportunity.

I do not differ with the last speaker that new whisky is bad for the system. But I think he has failed to show that new whisky is worse than old whisky. [An HON. MEMBER: "Try it and see."] I speak from small experience on this matter. I do not deny that I shared the delusion which still prevails in some quarters that new whisky was more deleterious than old whisky. But on investigating the question the Commission which looked into the matter in 1889 found strongly against compulsory bonding. The finding of that Commission was that the compulsory bonding of all spirits was unnecessary. The hon. Member suggests that the proper thing would be to have a compulsory period for bonding rather than the proposal in the Bill. The real reason of my rising is not to go deeply into the question, but simply to remind my hon. Friend of some other things the Commission reported. The hon. Baronet read:

"Most of the witnesses were of opinion that old whisky was less deleterious to health than new-whisky,"
but he omitted to read this:—
"It was not established before us that the toxicity of whisky is affected by age."
Toxicity, I understand, means poisoning qualities. The Commissioners draw attention to the fact that most of the witnesses repeated the current impression about the matter that new whisky is more harmful than old whisky, but that the moment they tried to get evidence of a more scientific and practical character no such evidence was forthcoming from any of the witnesses.

Is the hon. Member aware that vendors of whisky were asked to give evidence on the point, and that, according to my information, none of them were called?

I cannot say anything about that. The Commissioners also said that a case was brought to their notice where the workmen at a distillery consumed new spirit without any specially deleterious effect being observed. And then the Commissioners went on to say, what I believe to be the truth in this matter, namely, that the general tendency of the evidence was that any especially evil effects observed were rather to be attributed to the excessive quantity consumed than to the quality of the spirit. It is the quantity not the quality of the whisky consumed that tends to drunkenness. My hon. Friends have been saying that owing to the operations of the Budget the Scotch people have been driven to drink cheap new whisky, which is more intoxicating. But they forget the fact that, in spite of their contention that new whisky drives people much more readily to intoxication and crime; the number of convictions for drunkenness is now one-third less than it was before the Budget was introduced. That does not point to the conclusion that new whisky is more harmful than old.

It is an unusual experience for us to hear the hon. Member for the Appleby Division (Mr. Leif Jones) as an apologist of the moderate drinker. I welcome him in his new rôle. The speech of the hon. Baronet who sits for Elgin and Nairn (Sir A. Williamson) would have been more weighty with the Government if his convictions were strong enough to carry him into the Lobby against them. But I am not very much interested to meddle with the quarrel or difference of opinion between the hon. Baronet and the Chancellor of the Exchequer, because, on the whole, I think the Chancellor of the Exchequer has come to a right decision upon this question. I shall not go into the Lobby in support of the Amendment moved by the hon. Baronet who sits for Inverness (Sir John Dewar). If it be the case that on the grounds of health it is a desirable thing that whisky should be retained in bond, that may be a proper matter for legislation; but I do not think it is a proper matter for a Finance Bill. The hon. Baronet failed, as it seemed to me, to show that any hardship that there was was due to the tax. If the tax had to be paid immediately the whisky was distilled then, of course, the whisky which by its nature has to be kept long is at a disadvantage as compared with whisky which can be put at once on the market. The duty does not have to be paid when the whisky is distilled, but only when the whisky is taken out of bond. It is not the effect of the tax which the country ask the Chancellor of the Exchequer to counteract but the whisky. I think the right hon. Gentleman is wise to say that he will not make use of the Finance Bill to interfere with the competition between the two branches of the trade. If it is a question of health then the matter may be argued on that basis, but the Finance Bill is not the proper measure on which to argue it.

After about two hundred years of experience of different kinds of whisky, and after the research of the scientific men of the world, experiments are now made upon monkeys, in order to decide the relative merits of the various whiskies. I think all whisky should be put in bond, but I maintain that it is very little use to keep it in bond for two years. Put all the whisky in bond for two hundred years—there would be some good in that.

I wish to present an aspect of the case which has not yet been put to the Committee. The hon. Member on the other side, who, from his speech, I gather represents a barley-growing district in Scotland, told the Committee that the whisky produced in his constituency cost from 3s. to 3s. 9d. a gallon. I presume that a great deal of the whisky that is made elsewhere is produced at a manufacturer's cost of 1s. That 1s. whisky is not made from English, Irish, or Scotch produce. That whisky is made, as everybody knows, largely from German spirit. That whisky is also made, as everybody knows and as the hon. Baronet for Elgin and Nairn has indicated, from maize. I am not aware that there is any maize grown in Ireland, or in England, or in Scotland. And now what is the Chancellor of the Exchequer doing? He is penalising whisky made from home produce to the advantage of cheap whisky, which is made from German or American produce. Now I heard from a distiller some time ago about this Budget and the reason that he was favourable to it was that it will, as he says, "do him more good than any decent legislation that was ever passed." He was very much in favour of this because the whisky he produces is about 1s. 2d. a gallon, and he said to himself, "John Jameson's costs 7s. 6d. mine costs 1s. 2d. Will not the Chancellor of the Exchequer succeed by this taxation in running John Jameson out of the market?" Like my hon. Friend behind me, I can speak from practical knowledge, and I can assure the Chancellor of the Exchequer that for my health and my health's sake in the morning I would sooner drink whisky made of barley malt than that made from any German product.

Order, order. The Amendment deals with the age of whisky and not with the quality of whisky.

Yes, Mr. Caldwell. I learn that whisky made from German products does not improve with age; but when made from barley malt it does improve. Everybody knows—everybody who speaks from- practical experience, which hon. Gentlemen on the Ministerial side of the House cannot do—that patent still whisky does not improve with age; but pot still whisky does. The Chancellor of the Exchequer in refusing to accept the Amendment

Division No. 724.]

AYES.

[2.55 a.m.

Abraham, W. (Cork, N. E.)Hamilton, Marquess ofNewdegate, F. A.
Acland-Hood, Rt. Hon. Sir Alex, F.Hardy, Laurence (Kent, Ashford)Nolan, Joseph
Arkwright, John StanhopeHarris, Frederick LevertonO'Connor, John (Kildare, N.)
Banbury, Sir Frederick GeorgeHarrison-Broadley, H. B.Pease, Herbert Pike (Darlington)
Brotherton, Edward AllenHazleton, RichardPower, Patrick Joseph
Campbell, Rt. Hon. J. H. M.Healy, Maurice (Cork)Ratcliff, Major R. F.
Carlile, E. HildredHealy, Timothy MichaelRenton, Leslie
Castlereagh, ViscountHill, Sir ClementRonaldshay, Earl of
Cecil, Evelyn (Aston Manor)Hope, James Fitzalan (Sheffield)Rutherford, Watson (Liverpool)
Clive, Percy ArcherHunt, RowlandSheehy, David
Clyde, J. AvonJoyce, MichaelSmith, Abel H. (Hertford, East)
Coates, Major E. F. (Lewisham)Kilbride, DenisStanier, Beville
Cochrane, Hon. Thomas H. A. E.King, Sir Henry Seymour (Hull)Starkey, John R.
Courthope, G. LoydLockwood, Rt. Hon. Lt.-Col. A. R.Thomson, W. Mitchell- (Lanark)
Craik, Sir HenryLong, Rt. Hon. Walter (Dublin, S.)Valentia, Viscount
Cullinan, J.Lynch, A. (Clare, W.)Walker, Col. W. H. (Lancashire)
Dickson, Rt. Hon. C. ScottMacVeagh, Jeremiah (Down, S.)Warde, Col. C. E. (Kent, Mid)
Douglas, Rt. Hon. A. Akers-MacVeigh, Charles (Donegal, E.)Waring, Walter
Duffy, William J.Mason, James F. (Windsor)Watt, Henry A.
Forster, Henry WilliamMorpeth, ViscountWortley, Rt. Hon. C. B. Stuart-
Foster, P. S.Morrison-Bell, CaptainYounger, George
Gretton, JohnMuldoon, John
Guinness, Hon. R. (Haggerston)Murphy, John (Kerry, E.)TELLERS FOR THE AYES.—Mr. Renwick and Mr. Fell.
Gwynn, Stephen LuciusNannetti, Joseph P.
Haddock, George B.

NOES.

Agnew, George WilliamCorbett, A. Cameron (Glasgow)Harmsworth, R. L. (Caithness-shire)
Allen, A. Acland (Christchurch)Corbett, C. H. (Sussex, E. Grinstead)Haworth, Arthur A.
Allen, Charles P. (Stroud)Craig, Herbert J. (Tynemouth)Hedges, A. Paget
Ashton, Thomas GairCraig, Captain James (Down, E.)Helme, Norval Watson
Balfour, Robert (Lanark)Crosfield, A. H.Herbert, Col. Sir Ivor (Mon., S.)
Barker, Sir JohnDewar, Sir J. A. (Inverness-shire)Higham, John Sharp
Barran, Sir John NicholsonDuncan, C. (Barrow-in-Furness)Hobhouse, Rt. Hon. Charles E. H.
Barry, Redmond J. (Tyrone, N.)Duncan, J. Hastings (York, Otley)Holt, Richard Durning
Benn, W. (Tower Hamlets, St. Geo.)Dunne, Major E. Martin (Walsall)Horniman, Emslie John
Bennett, E. N.Edwards, Sir Francis (Radnor)Hudson, Walter
Bowerman, C. W.Elibank, Master ofJones, Leif (Appleby)
Brodie, H. C.Essex, R. W.Jones, William (Carnarvonshire)
Burns, Rt. Hon. JohnEvans, Sir S. T.King, Alfred John (Knutsford)
Buxton, Rt. Hon. Sydney CharlesEverett, R. LaceyLamont, Norman
Carr-Gomm, H. W.Ferguson, R. C. MunroLevy, Sir Maurice
Channing, Sir Francis AllstonFiennes, Hon. EustaceLloyd-George, Rt. Hon. David
Churchill, Rt. Hon. Winston S.Findlay, AlexanderLowe, Sir Francis William
Clough, WilliamFuller, John Michael F.Lupton, Arnold
Cobbold, Felix ThornleyGibson, J. P.Maclean, Donald
Collins, Stephen (Lambeth)Gulland, John W.McKenna, Rt. Hon. Reginald
Collins, Sir Wm. J. (St Pancras, W.)Harcourt, Robert V. (Montrose)M'Laren, H. D. (Stafford, W.)
Cooper, G. J.Harmsworth, Cecil B. (Worcester)Markham, Arthur Basil

proposed by Sir J. Dewar is certainly penalising whisky made from home products.

I have no wish to press this Amendment to a Division, and I beg the leave of the Committee to withdraw it.

Question put, "That the words 'Provided that, if the spirits be of an age of not less than five years, the duty shall be two shillings per proof gallon, and if the spirit be under five but over three years' of age the duty shall be two shillings and ninepence per proof gallon, the age of spirits that have been blended or vatted being taken to be the age of the youngest spirit in the blend or vat' be there added."

The Committee divided: Ayes, 70; Noes, 116.

Marnham, F. J.Rees, J. D.Verney, F. W.
Massie, J.Richards, T. F. (Wolverhampton, W.)Ward, W. Dudley (Southampton)
Middlebrook, WilliamRoberts, Charles H. (Lincoln)Warner, Thomas Courtenay T.
Murray, Capt. Hon. A. C. (Kincard.)Robinson, S.Wason, John Cathcart (Orkney)
Newnes, F. (Notts, Bassetlaw)Robson, Sir William SnowdonWhite, Sir George (Norfolk)
Nussey, Sir WillansRoch, Walter F. (Pembroke)White, J. Dundas (Dumbartonshire)
Nuttall, HarryRogers, F. E. NewmanWhite, Sir Luke (York, E. R.)
Parker, James (Halifax)Russell, Rt. Hon. T. W.Wilkie, Alexander
Partington, OswaldRutherford, V. H. (Brentford)Williams, J. (Glamorgan)
Paulton, James MellorSamuel, Rt. Hon. H. L. (Cleveland)Williams, W. Llewelyn (Carmarthen)
Pearce, Robert (Staffs, Leek)Samuel, S. M. (Whitechapel)Williamson, Sir A.
Pickersgill, Edward HareScarisbrick, Sir T. T. L.Wilson, W. T. (Westhoughton)
Pirie, Duncan V.Seely, ColonelWood, T. M'Kinnon
Pointer, J.Stanley, Hon. A. Lyulph (Cheshire)
Pollard, Dr. G. H.Summerbell, T.TELLERS FOR THE NOES.—Mr. Joseph Pease and Sir Edward Strachey.
Ponsonby, Arthur A. W. H.Thorne, G. R. (Wolverhampton)
Rea, Rt. Hon. Russell (Gloucester)Tomkinson, James
Rea, Walter Russell (Scarborough)Toulmin, George

Question proposed, "That the Clause stand part of the Bill."

Now that the Chancellor of the Exchequer is here perhaps he will answer a few questions. I understand that this is a Finance Bill Now a Finance Bill is required for the purpose of granting His Majesty the necessary means of raising public revenue. I was surprised to hear the Financial Secretary to the Treasury tell us that the tax on whisky is not imposed for revenue purposes but for temperance purposes. I do not think you should pursue a temperance policy in the guise of a Finance Bill. I object to this temperance legislation for Ireland The Financial Secretary to the Treasury made a great deal of fun about the way in which he had been attacked for his wrong estimate. He stated he had been accused of over-estimating the revenue and of under-estimating the decrease. All I know is that on the actual figures given to-day of the decrease of consumption in Ireland, that country will suffer the loss of £500,000 a year by this tax on decreased consumption. The right hon. Gentleman, the Chancellor of the Exchequer is, I believe, in possession of figures which he says go to prove that there has been no undue decrease in consumption since the month of April.

I understand him to say that there appears to be a decreased consumption from the month of April, but that really there has been as much whisky consumed since April owing to the fact that in April there were forestalments of an enormous amount of whisky.

I understand that he accounted for the abnormal decrease in consumption for the four months to the end of August on the ground that sufficient whisky was taken out of bond in April to keep them going in the hope that there might be a reduction of the tax, or that the tax might be abolished. That was the statement given to the House by his representative, the Financial Secretary to the Treasury. I do not know whether the Chancellor of the Exchequer is going to throw over the Financial Secretary. I am only replying to the arguments of the light hon. Gentleman. He said that the figures of consumption do not show the actual consumption, because we must add the figures of whisky taken out of bond during the month of April. I understand now from the Chancellor of the Exchequer that that is not so. That shows the difficulty in which we are working. I understand the Government's case to be that there was a fictitious decrease, which is due to the fact that certain astute people knew that he was going to increase the duty, and took out certain kinds of whisky.

Even admitting that there is going to be an increase in the taxation of Ireland to the extent of £500,000, I do not agree with the figures shown to me for the month of April. The tax the Chancellor of the Exchequer is putting on is going to hit. Ireland in an exceptional way. It hits three classes of people. First the distiller, next the consumer, and then the farmer. The great pride of this Government is that they want to make agriculture profitable. The result of your taxing whisky in Ireland, even before this 3s. 9d. was passed, is best illustrated by what happened in the district of Gal way. The distillery which Mr. Persse ran was the result of his endeavours to use only the home grown article. When the distillery was closed the farmers had no market for their barley. If the Chancellor of the Exchequer will take the trouble to look at the agricultural statistics for Ireland he will find that in the last ten or fifteen years an enormous quantity of land has gone out of cultivation, particularly in the north of Ireland. I see the Vice-President of the Department of Agriculture on the Front Bench. He will bear out my statement. The reason for that is very simple. In that time several small distilleries in Ireland have ceased to exist. There were distilleries with land round them in which barley was grown, but when the distilleries were closed the farmers could not get their barley into a market, and they had to produce other crops. By this extra tax of 3s. 9d. you are first of all going to take £500,000 out of our country, and next you are going to destroy the small distilleries. Each one of them employs a certain amount of labour, some 50 to 100 families being dependent upon each distillery, and all of these are going out of employment. The hon. Member for North Kildare (Mr. J. O'Connor) put before the House a short time ago the fact that Irish whisky made from bailey cost from 3s. to 3s. 9d. a gallon.

If you put a tax of 14s. 9d. on an article which cost 3s. 9d. you immediately bring the cost of that article up to a prohibitive price. The retailer cannot get the money back from the public, although he was told to do so by the Chancellor of the Exchequer, because the public will not pay. He is therefore driven to put on the market a cheaper article. The cheapest article he can get in this locality, which is called whisky, is manufactured from German spirits and costs about tenpence a gallon. You destroy the Irish farmer's market for his produce, you destroy the trade of the Irish distiller, you drive the distiller's men out of employment, and you bring in a German article at tenpence a gallon. That is the Chancellor of the Exchequer's idea of benefiting Ireland. As regards what the Financial Secretary to the Treasury has said about forestalment, I have the figures showing the quantity of spirits taken out of bond, and they show that the consumption in Ireland during the month of August last year was 548,000 gallons, whereas this year it was only 318,000 gallons. Anybody who knows anything about the trade will understand that this decrease could not have been caused by the amount of whisky taken out of bond in the month of April. It is an absolute decrease and not a decrease caused by forestalment. The fact of the matter is that although the Chancellor of the Exchequer occasionally quotes Sir Michael Hicks-Beach as a financial authority, he seems to forget entirely what Sir Michael Hicks-Beach said in this House after he had put on the extra 6d. in 1900. In April, 1901 or 1902, when he was making his Budget statement, he went over the various articles he could tax, and what he said was: "I have considered the feasibility of putting an extra tax on whisky, but one has to be very careful about dealing with an article like this, because we find the history of this thing shows us that once you get beyond a certain point not only do you not increase your revenue, but you actually decrease your old revenue." I submit that is what will happen here.

The Chancellor of the Exchequer, I assert, has put on too heavy a tax. Not only is he not going to get anything like the increased revenue which he has estimated he will obtain, but he is actually not going to get the old revenue from this article. I think under those circumstances the right hon. Gentleman must seriously reconsider the position of this tax and, in view of the great hardship which will be caused in Ireland owing to the number of people who will be thrown out of employment, he might take steps to reduce the proposed extra taxation on the special industry of that country. The right hon. Gentleman always justifies every tax he proposes to impose by saying when he gets up in this House that he must have money to carry on the Imperial services, but in this case the experience of five years shows that he is not going to get additional money by increasing the tax. He says that in the Budget he distributes evenly over all persons in the community the necessary burden for carrying on the government of the State. The answer given to the hon. Gentleman the Member for Shropshire this afternoon really goes to show that he has not distributed the burden of taxation in an equitable manner. As far as I remember the figures, the answer given by the Secretary to the Treasury was that on £100 worth of whisky the amount paid in duty was £61; on £100 worth of beer the amount paid was £23, and on £100 of champagne the amount paid in duty was £7. I do not know whether the Chancellor of the Exchequer thinks it is a fair distribution that champagne, which is not the drink of the working men, should only pay £7 out of £100, and that whisky should pay a tax of £61 out of £100. Beer, which is the drank of English working men, he lets off rather lightly. But the working men of Scotland and Ireland, which are not beer drinking countries, are to pay three times as much as the English working men. I think the figures supplied by the Financial Secretary to the Treasury show that the Chancellor of the Exchequer might have distributed the taxation in a much more equitable manner.

I have taken the opportunity of refreshing my memory by reading the Debate which took place on the Resolutions on the Whisky Tax earlier in the current year, and I cannot help noticing the difference between the criticisms now and then. The criticism now is that, so far, the extra taxation has not produced the revenue estimated, and that it will not do so by the end of the year. Every speaker who took part in the Debate on the Budget Resolutions, however, criticised my proposals from exactly the opposite point of view. There was not a single Member who took part in the Debate who did not condemn my estimate, and suggest that I was deliberately underestimating the amount of revenue I should get from the extra taxation. It was suggested to me that I did it purely in order to create a surplus, I thought then that there would be a decrease of consumption, and I knew there were forestalments, so that to that extent I have been nearer to what has happened than any of my critics in this House. What has happened since then? The foresbalments we knew pretty well. In two respects I over-estimated. The revenue has not been a very promising one. I under-estimated undoubtedly the immediate effect upon consumption, but I am assured by those who know something about the trade that this effect will only be temporary. Undoubtedly in some districts the reduction in consumption has been very considerable. I have heard almost startling figures. In some districts I have heard 30, 40, 50, and, I believe, 70 per cent. of a fall. But in some districts the opinion has been expressed that it was purely a temporary condition of things. Two things account for it—the publican putting up the price, and the workmen saying they will not buy it. I admit that the temporary reduction in the amount of whisky consumed has undoubtedly not merely surprised myself and the Revenue officials, but surprised everybody. There is another reason, I think, which accounts for the fact that up to the present there is a state of uncertainty in the whisky trade as to what is going to happen. To be perfectly frank, they are not sure whether the Budget is going through. There are-political possibilities which they are-reckoning on. They think there may be a chance that either the Budget might not go through, or that probably the Government would not stick to the duty. The effect of that is that they are keeping their stocks as low as possible, both wholesale and retail. There is no doubt they are conducting their business on the lowest possible margin. They are perfectly right from a business point of view until an absolute certainty has been established. That, I think, has undoubtedly had a very considerable effect upon the revenue. But we have only dealt up to the present with five months. The forestalments were about £2,500,000.

The horn Member is only referring to the Excise figures. My recollection is that there were £900,000 for March, including Customs and Excise; there were about £1,650,000 odd for April. Add the two together, and it comes to about 2½ millions. That is for Customs and Excise. These are the correct figures.

Do I understand that these are the forestalments, or are these the actual figures for the month of April, and if so, how do they compare with the month of April for the three previous years?

I have the actual figures of duty. April, last year—homemade, £1,435,000; imported, £327,000; total, £1,760,000. April, this year—£2,840,000—making a difference of £1,100,000, which I said.

I will check the figures given by the hon. Member. They are very considerable, and they, undoubtedly to a very large extent, account for the apparent decrease in consumption being larger than the real one. Now I think I have dealt with the point regarding the discrepancy in connection with the actual realisation and the estimate I made. The point I am making is that during the current five months of the year all these forestalments operate. It is therefore during five months of the year that the short stocks operate. I have taken steps to check the matter, and the gentlemen responsible for advising me still, in spite of what the hon. Gentleman says, adhere to their statement. I will undertake to check the hon. Gentleman's statement, but I have given to the Committee the actual figures given by the officials responsible for the matter. That accounts very largely for the discrepancy between the estimate and the realisation. I still say I do not think you can make up the estimate by taking a year. I still think there will be a substantial increase this year, but I do not think it will come to anything like the figures I gave to the House when I made my Budget estimate.

Will you give us the new estimate, what you now think the tax will produce in the year?

I could tell the right hon. Gentleman from week to week how the matter stands. It would be quite impossible to give a reliable estimate for another week or fortnight. The officials have come to the conclusion that before they can estimate with anything like approximate accuracy they must be satisfied that the reserve stocks are pretty well exhausted. In their judgment that will happen within the next week or two. I must give an estimate to the Committee before the Budget is through. But at the present moment I am not in a position to give an estimate to the Committee. It would be a mistake for me to do so. I can assure the Committee we have gone into this matter week by week. The justification for the tax is this: I had to get £16,000,000; I had to find sources of revenue. When I came to indirect taxes I had to decide as between tea, beer, sugar, tobacco, and whisky. These are the only sources of revenue which I think would bring in a substantial sum. I came to the conclusion that it would not be desirable to tax tea, and what happened? Hon. Members on the Opposition side made very strong speeches against it, and voted unanimously against taxing tea. The Opposition also invariably voted against the Sugar Duty. They voted last year in favour of a larger reduction than the Government were prepared to make. I gave my reasons with regard to beer. Any tax we could put on beer which could be passed on to the consumer would produce fifteen or twenty millions sterling. That was more than we wanted. I had therefore to choose tobacco and spirits. Assuming a year in which there is no forestalment, in an ordinary year, I thought that they would produce a very substantial addition to the Revenue.

I quite understand the difficulty which the Chancellor of the Exchequer has in regard to giving this estimate. But the absence of it places the Committee in a very great difficulty also. The right hon. Gentleman gave his estimate in the ordinary course when he made his Budget, and he is obliged to admit now that he and his advisers were mistaken and that that estimate will not be realised. But what is the amount of Revenue which is to be expected from the tax now, neither he nor his advisers will venture to say until we have voted the tax. I do not mean to suggest that he has deliberately withheld the information, but the fact that he cannot make an estimate before we have passed the tax is a most unfortunate thing and places the Committee in a great difficulty.

I do not quite understand how the Chancellor of the Exchequer came so much to under-estimate the effect of the forestalments. He attempted to justify himself, I think, a little by saying that he has looked back to the Debate on the subject and finds that nobody who criticised the tax on this side of the House took that line, but that everybody alleged that he was going to get a great deal more than his estimate. He is mistaken in thinking that nobody raised the question as to whether he would get so much. I have not refreshed my memory, but I am pretty confident that I raised the point myself and said that there was grave danger lest the increased tax would tend to injure revenue. I remember, however, making another speech in the opposite direction, which the right, hon. Gentleman may have come across. That speech was in reference to an observation which the right hon. Gentleman himself made as to the effect on the distiller and the trade of raising the price of whisky by a halfpenny. It was then stated by other right hon. Gentlemen, colleagues of the Chancellor, that by raising it a halfpenny the distillers would get even more than the Government. That appeared to be a perfectly preposterous suggestion, and I remember saying that if the Government were right as to the amount that would be recorded by the trade, they were clearly wrong in their own estimate. However, I am not concerned to pretend that I was wiser than I was; and the fact that we on this side of the House were wrong is no justification for the Chancellor of the Exchequer, who, after all, had the figures of the expected withdrawals. They were known to him when he made his estimate. Why, therefore, have the results taken him by surprise?

I do not think I made myself clear. I never said that the forestalments were a surprise to us, because we knew the actual figure. What I am surprised at is, first of all, the diminished consumption, and, second, that the stocks were so largely drawn upon. Those are the two things which surprised us; the forestalments I actually knew. I had the figures.

It is not the forestalments that have vitiated the estimate! Then it is the fact that stocks are being used up?

What does that mean, this diminished consumption which has such a great effect on the revenue? How much of the effect upon the revenue is due to living on stocks and how much is due to diminished consumption? The right hon. Gentleman says he has himself the figures, and is alarmed at the extent to which consumption has been diminished in some districts. Those reports have reached all of us. The Financial Secretary to the Treasury, a little time ago, said that, after all, the result was to diminish consumption, and that that was a result which would not be regretted on his side of the House. Is that really what it is the business of a financial Minister to do? He did not say that if it diminished drunkenness he would not mind; but that if it diminished consumption, without any social improvement, he is quite content to see a great industry crippled, and the habits of the people changed, with a result that even the Chancellor of the Exchequer, who proposed the impost, is avowedly disappointed. That is a rather novel attitude for the Government to take up with regard to their financial measures. Is it surprising that under these circumstances I was unable to follow the calculations of the right hon. Gentleman? I venture to say that no anticipatory clearances would clear up the matter. The right hon. Gentleman has spoken quite carelessly, and his anxiety to make a point at the moment carried him much beyond what he had any real authority to say. I notice even at this moment that the Chancellor of the Exchequer and the Financial Secretary cannot agree as to what the results of the tax are going to be. The Financial Secretary said something about anticipatory clearances, and that they would get their money; but the Chancellor of the Exchequer thinks they are not going to get their money. You have brought this tax to an unproductive point. You have increased it by a perfectly unparalleled increase at a time when consumption was falling. You have aggravated the fall.

Clearly what is happening is that the people are not drinking so much as they did before.

Then the Chancellor of the Exchequer is simply killing the goose that is laying so many golden eggs. He is injuring the tax which has been a most important part of our financial system. He is affecting employment in this particular industry in the first place, and undoubtedly making the position of some small distilleries much harder, and in some cases perhaps impossible to maintain. Through that he is attacking the farmer and the labourer. He is diminishing the market for barley; he is in all probability decreasing the amount of barley that will be grown, and when you add to that its effect in that way it will be seen that some of the poorest districts in the country will suffer—districts where there is least hope of turning to other things. All this, I say, constitutes a very grave objection to the tax that the right hon. Gentleman is imposing. I do not wish to go through all the points made in the brilliant speech made by the Leader of the Opposition; but it should be remembered that the right hon. Gentleman has singled out for this gigantic increase a form of alcoholic liquor which is specially drunk in two portions of the United Kingdom.

I notice that one hon. Member is shaking his head violently. No doubt there is more whisky drunk in this country than in Scotland or Ireland, but there is not more whisky drunk per head among the working men of this country than in Scotland or Ireland. On every ground—of policy, of financial convenience, of justice, and of reason—I think the Chancellor of the Exchequer has made a bad choice in proposing this gigantic increase in relation to this already heavily burdened industry.

I maintain that it is not right to dislocate the whole trade by putting these duties on. The proposed taxation will act exceeding unfairly on an Irish industry, and will mean a great loss to it. I would urge the Chancellor of the Exchequer to abandon the proposed tax at once rather than to dislocate the trade.

Before this vote goes to a Division I desire to make a protest on behalf of the island of Jamaica. That island has three principal products—logwood, sugar, and rum. The logwood trade has been entirely spoiled and lost owing to the new discoveries of the manufacture of dyes out of tar. The consequence is that during the last two years the island has been obliged to rely entirely upon its sugar and upon its rum. They have had very good prices lately, comparatively speaking, for their sugar.

The rum does. I think it will be admitted that rum is a spirit. The position in regard to Jamaica rum is this: The whole of the crop of last year, which was grown under the impression that it would be sold in this country at a certain price, was shipped in the months of January, February, March, and the early part of April of the present year. Most of it came to London, and owing to the Resolution that we passed for this Budget, and the imposition of this 3s 9d. on whisky, most of it is lying at present in bond, incapable of being sold. The loss which is inflicted upon the island of Jamaica if this tax is persisted in and the Budget should ever pass into law will be practically irreparable. I think it is only fair when the imposition of 3s. 9d. extra tax on all spirits, including rum, is brought before the Committee in this way, that one or two minutes should be occupied in making a protest on behalf of this island.

I only want to say a few words on this tax. It is, in my view, a consumer's tax, not only because the consumer has to pay the difference in price, but because I believe it makes for the supply of an inferior article to the public. Everybody knows that the whisky the public get is not the spirit that leaves the hands of the distiller. It passes through other hands and is blended according to the particular brand and particular price required. There is already a large quantity of very inferior spirit sent into this country which is manufactured on the Continent at a very low price, for the purpose of blending in the cheaper sorts of whisky sold under no particular name in a good many parts of the country. This spirit, I am informed, is manufactured in Hamburg or Rotterdam at 9d. or 9½d. a gallon, and it can be imported into this country at 11d. a gallon, not including duty. No spirit of a reasonable kind can be manufactured in this country for less than 1s. 3d., because there are certain Excise restrictions with regard to the materials to be used in the manufacture of whisky. Those restrictions do not apply to these very cheap spirits which are manufactured on the Continent. This increase in the Whisky Tax is a direct inducement and incentive to the blending of this cheap spirit with the whisky that is legitimately manufactured by Scottish and Irish distillers. I am informed that it is shown in the Returns that the consumption of whisky has greatly fallen off. That great reduction will perhaps balance itself to some extent, but I am quite certain that the Government are entirely wrong in thinking that this tax is not going to seriously reduce the whisky consumption in this country.

The real test in this matter is not the Excise Returns, but the experience of those engaged in the trade of retailing whisky. When you find that that trade is falling off, as it is in some cases—I have personally investigated cases in which it has fallen off from 25 to over 30 per cent., and sometimes as much as 50 per cent.—the Government will gain some idea how far the tax is going to fail them. In some cases the trade done has been so great that the price of whisky has not been put up, and the only way in which whisky can be sold at the old price is by selling a very inferior article. One very curious result which the Government have not anticipated is that in some cases in London and elsewhere the public desire to have the same quantity of whisky, and have to pay 4d. instead of 3d., and they save the penny by not having mineral water but plain water. The result is that the mineral water manufacturers have suffered a great decrease in business owing to the operation of this tax. It appears to me that on these grounds the tax is not going to yield the revenue the Government anticipate, and the public are going to get an inferior article. The Government's case has entirely broken down, and the tax ought not to be imposed.

4.0 A.M.

I should not be doing my duty as an Irish Member if I did not utter a protest, brief as it must be, but I hope emphatic, against this proposed increase in the Spirit Duty. I desire to take note of the speech of the late Chancellor of the Exchequer (Mr. Austen Chamberlain). I hope he will remember, when he comes into office again, all the good things he has said to-night. I do not recollect that when his party increased the whisky duty, we heard a single word such as he used to-night in deprecation of this proceeding. There is no knowing what may happen in the future, but after his speech to-night he will be bound to take off the 3s. 9d. that is being put on now if ever he assumes the office of Chancellor of the Exchequer again. A controversy has arisen to-night into which I will not enter. The question is whether this tax is going to produce what the Chancellor of the Exchequer anticipates. A good deal has been said on both sides of that question, but I do not intend to add a word to the controversy. The point I desire to make is, that if the Revenue is obtained and if the Chancellor of the Exchequer's original estimate is realised, the grievance of Ireland will be all the greater. The reason is perfectly plain, because it is undoubtedly the case that you will increase the proportion of indirect taxation which Ireland already pays. Before the introduction of the Budget the proportion of indirect taxation paid by England was 42 per cent. and in Ireland it was 73 per cent. What will happen if the Chancellor of the Exchequer's estimates are realised? The proportion paid by Ireland will probably be increased beyond 73 per cent., while probably the proportion paid by England will go down. I cannot regard such a result with equanimity, and all I can say is that we should be gravely wanting in the performance of our duty if we did not utter a protest against a result of that kind being brought about under any Budget.

I should like to intervene just for a moment in order to give the information I spoke of when I interrupted the Chancellor of the Exchequer to correct his figures. The figures for the month of April show that the withdrawals out of bond in 1907 amounted to £1,766,000 of duty, in 1908 to £1,762,000 duty, and in 1909 to £2,840,000 duty, or a difference comparing 1908 and 1909 of £1,080,000 duty, not £2,000,000 duty as the Chancellor of the Exchequer said. If you take the quarter ending March there was a total forestalment of 680,000 gallons, but I do not think that accounts for the very great loss of revenue. Undoubtedly a certain amount of revenue was lost owing to forestalments, because the Exchequer only got a tax of 11s. instead of 13s. 9d. But that is only a matter of about £400,000, and I believe it was included in the calculation of the Chancellor of the Exchequer when he introduced the Budget. It is very disappointing to me that the Chancellor of the Exchequer made no attempt to answer the speech I made earlier in the discussion. The right hon. Gentleman justified the amount of the tax by stating that if you did not put on a heavy tax you would not be able to obtain the revenue owing to dilution. There is however, as I pointed out, a limit of strength below which the publican cannot now dilute and still keep within the law, and even if sixpence or threepence had been put on it would have been got quite easily owing to the fact that the publican has reached the limit of dilution. It seems to me very unfortunate that the Chancellor of the Exchequer has not attempted some better justification of the tax. I am sure the distillers in Scotland will regard this as a very unsatisfactory night's work, and they will not have a high opinion of the wisdom or fairness of the Chancellor of the Exchequer.

I make no apology to the Committee for engaging its attention for a short time at this early hour of the morning. I want to associate myself with my colleagues in their protest against this inequitable and iniquitous tax. Further, I wish to express my great disappointment that the attitude taken up by the Irish Members to-night has not found support on the other side of the House. How Members on the other side, led by the Government, have often professed and expressed great friendship for Ireland. They have not expressed it to-night. Perhaps it was right to dissemble their love, but why did they kick us downstairs? That is what they are doing. [Cries of "No, no."] I am entitled to my opinion, and I am going to express it. You may dissent from it if you like. It ha3 been said to-night by my hon. Friend the Member for the Scotland Division of Liverpool (Mr. T. P. O'Connor) that this is a fatal blow struck at the remaining industry of the Irish people. He has pointed out that the loss to Ireland in its export and home trade will amount to no less a sum than £2,000,000 per annum. Are we to sit down here quietly either by day or by night and not raise a protest against such an iniquitous tax? Ireland has been over-taxed already. You have heard that before. You will hear it again. It will be repeated and reiterated at all seasonable times. You are about to add to the inequitable taxation of Ireland by the tax now under discussion. It has been pointed out that this great industry in Ireland is being damaged very seriously, because there is a decrease in the manufacture of the article itself, and injury is also inflicted on agriculture. How is this statement to be proved? It may easily be proved by a reference to the statistics which have been published by the Department of Agriculture in Ireland. From their latest publications it may be gathered that between the year 1907–8 there was a decrease in the growth of barley of over 16,000 acres, or nine-tenths of the total acreage under that crop in Ireland. It may be said that this decrease in cultivation would be made up by the imports of barley, because Ireland does not depend entirely for her supply on her own native growth of barley. She imports largely from Canada, Russia, and other countries. But what do I find? Between the two years I have named there has been a decrease of no less than 164 cwt. in the imports of barley. And it is still going on. But that is not all. There has been a decrease in the imports of malt to the extent of 400,000 cwt. So that if you check the growth of barley in Ireland, and the importation of barley into Ireland, it proves clearly that there is a lesser quantity being manufactured. What do I conclude from that? That you are attacking a dying industry, that you are going to inflict a fatal blow on that industry by the imposition of this tax. I heard it stated by the hon. Gentleman who has just engaged the attention of the Committee that one of the results of this tax will be that the people will be supplied with an inferior article. That is the case. The people are demanding their whisky for the same price. They cannot be supplied as they were before with a good commodity. If they are to get whisky at the same price as before it must be of an inferior quality. Now there is another effect that will follow from this tax. It will increase illicit distillation. A very large increase was put upon the Excise duties in 1821. What was the result? A vast increase in illicit distillation, so much so that the tax was removed. From every point of view this is an inefficient, inequitable, and unjust tax so far as Ireland is concerned. It is because our people feel very strongly about it that we are to-night making our most solemn and earnest protest against this vast injustice to Ireland.

This tax really seems to be too absurd. As it has been shown, not only is it unjust, but it will not provide any money. Hon. Gentlemen on the Front Bench opposite are attacking their Irish friends as much as their Scottish friends. Is the right hon. Gentleman the Member for West Islington aware of what he said in May, 1905? "The 6d. tax had been renewed, and the right hon. Gentleman moved to leave out the Clause which reimposed the war tax on spirits because it was a war tax." The 6d. is still on and there is 3s. 9d. more of a war tax going on. The same right hon. Gentleman went on to say that "An effort should be made towards economy, but the Government have forgotten their pledges about economy. The Chancellor of the Exchequer really ought to tell the Committee what these war taxes are." When the subject was under discussion the right hon. Gentleman did not think if this 6d. tax was kept on that the Chancellor of the Exchequer would get as much money as if it was taken off. I hope the right hon. Gentleman will observe that this sixpence is still kept on, and that 3s. 9d. is stuck on the top of it. When the sixpenny tax was being discussed, the right hon. Gentleman said "that the excessive taxation of these commodities did not promote or increase temperance, but simply made those with a craving for liquor poor as well as drunken." That was the right hon. Gentleman's opinion at that time. Then the hon. Member for Halifax—another Member of the Government—said "that the extra sixpence on spirits led to the consumption of immature spirits which was provocative to violent crime." If a sixpence provokes violent crime I wonder what 3s. 9d. on the top of it is going to do. I know a number of people in the north of Scotland, and they all say that there is an enormous amount of harm done by the highlanders drinking new raw whisky. They tell me that a couple of glasses of new raw whisky will send a man nearly mad; but if it is moderately good whisky and mature they say it will do good and not harm. I do not wish to press that view, but it is said to be so. Another Member of the Government, the Member for East Perthshire, said, "The Government had no right to continue in peace times this sixpenny tax, which was a war tax; that the Chancellor of the Exchequer ought to indicate the date when it was going to be removed." I think the Chancellor of the Exchequer should have made up his mind by now that the tax is useless, if only because he will not get the money. If these hon. and right hon. Gentlemen who spoke their minds so freely in 1905 were right there is no doubt that this extra taxation will have a very bad effect, because men who must drink whisky will drink bad whisky and there is nothing worse for your inside than bad whisky. There is no doubt about it this extra tax is especially unfair to Ireland and Scotland. I do say that no Government, not

Division No. 725.]

AYES.

[4.25 a.m.

Agnew, George WilliamGlendinning, R. G.Pirie, Duncan V.
Allen, A. Acland (Christchurch)Grey, Rt. Hon. Sir EdwardPointer, J.
Allen, Charles P. (Stroud)Gulland, John W.Pollard, Dr. G. H.
Ashton, Thomas GairHaldane, Rt. Hon. Richard B.Ponsonby, Arthur A. W. H.
Balfour, Robert (Lanark)Harcourt, Robert V. (Montrose)Rea, Rt. Hon. Russell (Gloucester)
Barker, Sir JohnHarmsworth, Cecil B. (Worc'r.)Rea, Walter Russell (Scarborough)
Barran, Sir John NicholsonHarmsworth, R. L. (Caithness-shire)Rees, J. D.
Barry, Redmond J. (Tyrone, N.)Haworth, Arthur A.Richards, T. F. (Wolverhampton, W.)
Benn, W. (Tower Hamlets, St. Geo.)Hedges, A. PagetRoberts, Charles H. (Lincoln)
Bennett, E. N.Helme, Norval WatsonRobinson, S.
Bowerman, C. W.Herbert, Col. Sir Ivor (Mon., S.)Robson, Sir William Snowdon
Brigg, JohnHigham, John SharpRoe, Sir Thomas
Brodie, H. C.Hobhouse, Rt. Hon. Charles E. H.Rogers, F. E. Newman
Burns, Rt. Hon. JohnHorniman, Emslie JohnRussell, Rt. Hon. T. W.
Buxton, Rt. Hon. Sydney CharlesHoward, Hon. GeoffreyRutherford, V. H. (Brentford)
Carr-Gomm, H. W.Jones, Leif (Appleby)Samuel, Rt. Hon. H. L. (Cleveland)
Channing, Sir Francis AllstonJones, William (Carnarvonshire)Samuel, S. M. (Whitechapel)
Churchill, Rt. Hon. Winston S.King, Alfred John (Knutsford)Scarisbrick, Sir T. T. L.
Clough, WilliamLamont, NormanSeely, Colonel
Cobbold, Felix ThornleyLehmann, R. C.Silcock, Thomas Ball
Collins, Stephen (Lambeth)Levy, Sir MauriceStanley, Hon. A. Lyulph (Cheshire)
Collins, Sir Wm. J. (St. Pancras, W.)Lloyd-George, Rt. Hon. DavidSummerbell, T.
Cooper, G. J.Lough, Rt. Hon. ThomasThorne, G. R. (Wolverhampton)
Corbett, A. Cameron (Glasgow)Lupton, ArnoldTomkinson, James
Corbett, C. H. (Sussex, E. Grinstead)Maclean, DonaldToulmin, George
Cowan, W. H.M'Callum, John M.Verney, F. W.
Craig, Herbert J. (Tynemouth)M'Kenna, Rt. Hon. ReginaldWard, W. Dudley (Southampton)
Crosfield, A. H.M'Laren, H. D. (Stafford, W.)Wason, John Cathcart (Orkney)
Duncan, C. (Barrow-in-Furness)Markham, Arthur BasilWhite, Sir George (Norfolk)
Duncan, J. Hastings (York, Otley)Marnham, F. J.White, J. Dundas (Dumbartonshire)
Dunne, Major E. Martin (Walsall)Massie, J.White, Sir Luke (York, E. R.)
Edwards, Sir Francis (Radnor)Middlebrook, WilliamWilkie, Alexander
Elibank, Master ofMurray, Capt. Hon. A. C. (Kincard.)Williams, J. (Glamorgan)
Essex, R. W.Newnes, F. (Notts, Bassetlaw)Williams, W. Llewelyn (Carmarthen)
Evans, Sir Samuel T.Nussey, Sir WillansWilliamson, Sir A.
Everett, R. LaceyNuttall, HarryWilson, W. T. (Westhoughton)
Ferguson, R. C. MunroParker, James (Halifax)Wood, T. M'Kinnon
Fiennes, Hon. EustacePartington, Oswald
Findlay, AlexanderPaulton, James MellorTELLERS FOR THE AYES.—Mr. J. A. Pease and Sir E. Strachey.
Fuller, John Michael F.Pearce, Robert (Staffs, Leek)
Gibson, J. P.Pickersgill, Edward Hare

even a great democratic Government, has any business to tax the working man's whisky 300 to 400 per cent., and let the rich man's wine off. The Financial Secretary to the Treasury gave the figures of the taxation on whisky and wine. He said that the tax on whisky is between 300 and 400 per cent., and the tax on good champagne only about 8 or 9 per cent. I cannot calculate how many times more the poor man is taxed than the rich in this connection. I do not care what anybody says, no Government has any right to go and cram taxes on the working classes of this country like this. I hope that that will be brought home to the Chancellor of the Exchequer when he goes down to his wild Welsh hills. I hope down there they will say, "Consider how this Liberal Free Trade Government harasses the poor man."

Question put, "That the Question be now put."

The Committee divided: Ayes, 118; Noes, 84.

NOES.

Abraham, W. (Cork, N. E.)Gwynn, Stephen LuciusNewdegate, F. A.
Arkwright, John StanhopeHaddock, George B.Nicholson, Wm. G. (Petersfield)
Balcarres, LordHamilton, Marquess ofNolan, Joseph
Boland, JohnHardy, Laurence (Kent, Ashford)O'Brien, Patrick (Kilkenny)
Brotherton, Edward AllenHarrison-Broadley, H. B.O'Connor, John (Kildare, N.)
Bull, Sir William JamesHazleton, RichardO'Connor, T. P. (Liverpool)
Campbell, Rt. Hon. J. H. M.Healy, Maurice (Cork)Pease, Herbert Pike (Darlington)
Carlile, E. HildredHealy, Timothy MichaelPower, Patrick Joseph
Castlereagh, ViscountHill, Sir ClementRatcliff, Major R. F.
Cecil, Evelyn (Aston Manor)Hope, James Fitzalan (Sheffield)Reddy, M.
Chamberlain, Rt. Hon. J. A. (Worc'r.)Hunt, RowlandRenton, Leslie
Clancy, John JosephJoyce, MichaelRenwick, George
Clive, Percy ArcherKeating, MatthewRonaldshay, Earl of
Clyde, James AvonKilbride, DenisRutherford, Watson (Liverpool)
Coates, Major E. F. (Lewisham)King, Sir Henry Seymour (Hull)Sheehy, David
Cochrane, Hon. Thos. H. A. E.Lockwood, Rt. Hon. Lt.-Col. A. R.Stanier, Beville
Condon, Thomas JosephLong, Rt. Hon. Walter (Dublin, S.)Starkey, John R.
Courthope, G. LoydLundon, T.Thomson, W. Mitchell- (Lanark)
Craig, Captain James (Down, E.)Lynch, Arthur (Clare, W.)Walker, Col. W. H. (Lancashire)
Craik, Sir HenryMacNeill, John Gordon SwiftWarde, Col. C. E. (Kent, Mid)
Cullinan, J.MacVeagh, Jeremiah (Down, S.)White, Patrick (Meath, North)
Devlin, JosephMacVeigh, Charles (Donegal, E.)Williams, Col. R. (Dorset, W.)
Dickson, Rt. Hon. C. ScottMason, James F. (Windsor)Wortley, Rt. Hon. C. B. Stuart-
Douglas, Rt. Hon. A. Akers-Meagher, MichaelYounger, George
Duffy, William J.Mooney, J. J.
Fell, ArthurMorpeth, Viscount
Forster, Henry WilliamMorrison-Bell, CaptainTELLERS FOR THE NOES.—Sir
Foster, P. S.Muldoon, JohnA. Acland-Hood and Viscount Valentia.
Gretton, JohnMurphy, John (Kerry, East)
Guinness, Hon. R. (Haggerston)Nannetti, Joseph P.

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

Division No. 726.]

AYES.

[4.30 a.m.

Agnew, George WilliamGibson, J. P.Pearce, Robert (Staffs, Leek)
Allen, A. Acland (Christchurch)Glendinning, R. G.Pickersgill, Edward Hare
Allen, Chares P. (Stroud)Greenwood, G. (Peterborough)Pirie, Duncan V.
Ashton, Thomas GairGulland, John W.Pointer, J.
Balfour, Robert (Lanark)Haldane, Rt. Hon. Richard B.Pollard, Dr. G. H.
Barker, Sir JohnHarcourt, Robert V. (Montrose)Ponsonby, Arthur A. W. H.
Barran, Sir John NicholsonHarmsworth, Cecil B. (Worcester)Rea, Rt. Hon. Russell (Gloucester)
Barry, Redmond J. (Tyrone, N.)Harmsworth, R. L. (Caithness-shire)Rea, Walter Russell (Scarborough)
Benn, W. (Tower Hamlets, St. Geo.)Haworth, Arthur A.Rees, J. D.
Bennett, E. N.Hedges, A. PagetRichards, T. F. (Wolverhampton, W.)
Bowerman, C. W.Helme, Norval WatsonRoberts, Charles H. (Lincoln)
Brigg, JohnHerbert, Col. Sir Ivor (Mon., S.)Robinson, S.
Brodie, H. C.Higham, John SharpRobson, Sir William Snowdon
Burns, Rt. Hon. JohnHobhouse, Rt. Hon. Charles E. H.Roe, Sir Thomas
Buxton, Rt. Hon. Sydney CharlesHorniman, Emslie JohnRogers, F. E. Newman
Carr-Gomm, H. W.Howard, Hon. GeoffreyRussell, Rt. Hon. T. W.
Channing, Sir Francis AllstonJones, Leif (Appleby)Rutherford, V. H. (Brentford)
Churchill, Rt. Hon. Winston S.Jones, William (Carnarvonshire)Samuel, Rt. Hon. H. L. (Cleveland)
Clough, WilliamKing, Alfred John (Knutsford)Samuel, S. M. (Whitechapel)
Cobbold, Felix ThornleyLamont, NormanScarisbrick, Sir T. T. L.
Collins, Stephen (Lambeth)Lehmann, R. C.Seely, Colonel
Collins, Sir Wm. J. (St. Pancras, W.)Levy, Sir MauriceStanley, Hon. A. Lyulph (Cheshire)
Cooper, G. J.Lloyd-George, Rt. Hon. DavidSummerbell, T.
Corbett, A. Cameron (Glasgow)Lough, Rt. Hon. ThomasThorne, G. R. (Wolverhampton)
Corbett, C. H. (Sussex, E. Grinstead)Lupton, ArnoldTomkinson, James
Cowan, W. H.Maclean, DonaldToulmin, George
Craig, Herbert J. (Tynemouth)M'Callum, John M.Verney, F. W.
Crosfield, A. H.McKenna, Rt. Hon. ReginaldWard, W. Dudley (Southampton)
Duncan, C. (Barrow-in-Furness)M'Laren, H. D. (Stafford, W.)Wason, John Cathcart (Orkney)
Duncan, J. Hastings (York, Otley)Markham, Arthur BasilWhite, Sir George (Norfolk)
Dunne, Major E. Martin (Walsall)Marnham, F. J.White, J. Dundas (Dumbartonshire)
Edwards, Sir Francis (Radnor)Massie, J.White, Sir Luke (York, E. R.)
Elibank, Master ofMiddlebrook, WilliamWilkie, Alexander
Essex, R. W.Murray, Capt. Hon. A. C. (Kincard.)Williams, J. (Glamorgan)
Evans, Sir Samuel T.Newnes, F. (Notts, Bassetlaw)Williams, W. Llewelyn (Carmarthen)
Everett, R. LaceyNussey, Sir WillansWilson, W. T. (Westhoughton)
Ferguson, R. C. MunroNuttall, HarryWood, T. M'Kinnon
Fiennes, Hon. EustaceParker, James (Halifax)
Findlay, AlexanderPartington, OswaldTELLERS FOR THE AYES.—Mr. Joseph Pease and Sir E. Strachey.
Fuller, John Michael F.Paulton, James Mellor

The Committee divided: Ayes, 117; Noes, 84.

NOES.

Abraham, W. (Cork, N. E.)Guinness, Hon. R. (Haggerston)Murphy, John (Kerry, East)
Arkwright, John StanhopeGwynn, Stephen LuciusNannetti, Joseph P.
Balcarres, LordHaddock, George B.Newdegate, F. A.
Boland, JohnHamilton, Marquess ofNicholson, Wm. G. (Petersfield)
Brotherton, Edward AllenHardy, Laurence (Kent, Ashford)Nolan, Joseph
Bull, Sir William JamesHarrison-Broadley, H. B.O'Brien, Patrick (Kilkenny)
Campbell, Rt. Hon. J. H. M.Hazleton, RichardO'Connor, John (Kildare, N.)
Carlile, E. HildredHealy, Maurice (Cork)O'Connor, T. P. (Liverpool)
Castlereagh, ViscountHealy, Timothy MichaelPease, Herbert Pike (Darlington)
Cecil, Evelyn (Aston Manor)Hill, Sir ClementPower, Patrick Joseph
Chamberlain, Rt. Hon. J. A. (Worc'r.)Hope, James Fitzalan (Sheffield)Radcliff, Major R. F.
Clancy, John JosephHunt, RowlandReddy, M.
Clive, Percy ArcherJoyce, MichaelRenton, Leslie
Clyde, James AvonKeating, MatthewRenwick, George
Coates, Major E. F. (Lewisham)Kilbride, DenisRonaldshay, Earl of
Cochrane, Hon. Thomas H. A. E.King, Sir Henry Seymour (Hull)Rutherford, Watson (Liverpool)
Condon, Thomas JosephLockwood, Rt. Hon. Lt.-Col. A. R.Sheehy, David
Courthope, G. LoydLong, Rt. Hon. Walter (Dublin, S.)Stanier, Beville
Craig, Captain James (Down, E.)Lundon, T.Starkey, John R.
Craik, Sir HenryLynch, Arthur (Clare, W.)Thomson, W. Mitchell- (Lanark)
Cullinan, J.MacNeill, John Gordon SwiftWalker, Col. W. H. (Lancashire)
Devlin, JosephMacVeagh, Jeremiah (Down, S.)Warde, Col. C. E. (Kent, Mid)
Dickson, Rt. Hon. C. ScottMacVeigh, Charles (Donegal, E.)White, Patrick (Meath, North)
Douglas, Rt. Hon. A. Akers-Mason, James F. (Windsor)Williams, Col. R. (Dorset, W.)
Duffy, William J.Meagher, MichaelWortley, Rt. Hon. C. B. Stuart-
Fell, ArthurMooney, J. J.Younger, George
Forster, Henry WilliamMorpeth, Viscount
Foster, P. S.Morrison-Bell, CaptainTELLERS FOR THE NOES.—Sir
Gretton, JohnMuldoon, JohnW. Bull and Mr. Younger.

I beg to move, "That the Chairman do report Progress, and ask leave to sit again."

Motion agreed to.

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

Finance Consolidated Fund Bill

Considered in Committee.

(IN THE COMMITTEE.)

Additional Payments To Local Authorities On Account Of Land Value Duties

Motion made, and Question proposed,

"That there shall be charged on the Consolidated Fund in each year a sum equal to half the proceeds of the duties levied in respect of land values (including Mineral Eights Duties) under any Act of the present Session, and that sum shall be divided between England, Scotland, and Ireland in such a manner and paid into such separate accounts for the benefit of such local authorities as Parliament may determine."—[Mr. Lloyd-George.]

I do not propose to press this to-night if there is likely to be any discussion. There is another Resolution which I am afraid I must press, as we must get the Report stage early. That is absolutely essential. That Resolution has reference to a new Clause. I beg, therefore, to withdraw this Resolution.

Motion, by leave, withdrawn.

Division Of Local Taxation Licence Duties Between Local Authorities And Exchequer

Motion made, and Question proposed,

"That for the purpose of payments into any Local Taxation Account, the proceeds of any duties on any local taxation licences (including duties for motor cars) which are altered by any Act passed in the present Session shall be deemed to be the proceeds of the duties in the year ending the thirty-first day of March, nineteen hundred and nine."—[Mr. Lloyd-George.]

I do not wish to put the Committee to the trouble of a Division at this time of the morning on this Resolution, or to make any Amendment, but I do desire to enter a protest against the way in which the Government is working the House and taxing the capacity of Members. It is idle to pretend that we can do our duty by these discussions when we are kept sitting here from three in the afternoon every day this week until 2 or 3 o'clock in the morning. We met at 3 o'clock yesterday afternoon, and have been sitting till a quarter to five in the morning, and are asked to be back here to resume the discussion at noon. The Clause we have been discussing since midnight is a very important one, not, indeed, a new tax, but such an addition to a new tax as is entirely novel. The first thing we have to discuss to-morrow is a question which arouses a great deal of feeling and controversy. It is quite unfair to the House, and very bad for the business of the House, that the Governmeit should put this tax upon them.

Many Members do not know what the Government propose to take to-night. We understand that the Government are going to press this Resolution, and that there are others. We should like to know what we are to be asked to do.

That is a very reasonable request, and I shall be happy to comply with it. The Resolution which might be regarded as containing debatable matter was the one read from the Chair to-night. The Resolution with regard to Mineral Rights we do not propose to take, nor the Report of the Estate Duties Resolution, nor the Mineral Increment Duty Resolution. The only Resolutions we propose to take to-night are those which are purely formal and enable us to proceed with the discussion to-morrow on the Motor Licences and motor roads. We must get the Report of these to-morrow, otherwise we cannot proceed with the Bill. With regard to what the right hon. Gentleman (Mr. Austen Chamberlan) has said, I do not think we have sat very late this week. This morning is very exceptional; it is the only night we have been very late, especially when you compare it with the length of our sittings a month or so ago. We sat sometimes till 7 o'clock.

What does the Chancellor of the Exchequer propose to take at noon to-day?

I suggest that we should take the Report stage of these Resolutions. I do not propose to begin with the very contentious matter to which the right hon. Gentleman (Mr. Austen Chamberlain) referred.

The right hon. Gentleman has stated, and I quite agree with him, that we have not sat very late this week, but I take note of the fact that when we sat on after midnight it was on a clause which was objected to by all the Irish representatives. It will be some consolation to the right hon. Gentleman the Member for East Worcestershire (Mr. Austen Chamberlain) to know that in America when they want to get through a Tariff Bill they always select these hours.

  • 1. Resolved, That, for the purpose of payments into any Local Taxation Account, the proceeds of any duties on any local taxation licences (including duties for motor cars) which are altered by any Act passed in the present Session shall be deemed to be the proceeds of the duties in the year ended the thirty-first day of March, nineteen hundred and nine.
  • 2. Resolved, That any duties for motor cars imposed by any Act of the present Session be levied by county councils in England and Wales, and be duties to which Section six of The Finance Act, 1908, applies, and that the amount of the duties so levied be divided between county councils (including the councils of county boroughs) in England and Wales and the Exchequer so as to provide for the payment to each such county council of an amount equal to the proceeds of the duties levied by that council during the year ending the thirty-first day of March, nineteen hundred and nine, in respect of motor cars on which the new duties are imposed, and for the payment of the balance into the Exchequer, and that if in any year the amount of the duties so levied is not sufficient to pay to each such county council the amount required to be paid the deficiency shall be charged on the Consolidated Fund.—[Mr. Lloyd-George.]
  • 3. Resolved, That all payments made in pursuance of conditions attached to new licences under Section four of the Licensing Act, 1904, shall be paid into the Exchequer.—[Mr. Lloyd-George.]
  • Resolutions to be reported to-morrow (Friday). Committee to sit again tomorrow.

    ADJOURNMENT.—Resolved, that this House do now adjourn.—[ Mr. Joseph Pease.]

    Adjourned accordingly at Thirteen minutes before Five o'clock a.m. (Friday, 24th September)