House of Commons
Tuesday, June 23, 1914
Private Business
Central London Railway Bill (by Order),
Lords Amendments considered, and agreed to.
Wesleyan and General Assurance Society Bill [ Lords ] (by Order),
Consideration, as amended, deferred till Friday.
Midland Railway Bill [ Lords ] (by Order),
Second Reading deferred till Thursday.
Liverpool United Gaslight Company Bill [ Lords ] (by Order),
Great Northern Railway Bill [ Lords ] (by Order),
North Eastern Railway Bill [ Lords ] (by Order),
Second Reading deferred till Friday.
Local Government (Ireland) Provisional Orders (No. 4) Bill,
Pier and Harbour Provisional Orders (No. 4) Bill,
Read a second time, and committed.
Electric Lighting Provisional Orders (No. 6) Bill (by Order),
Consideration, as amended, deferred till Tuesday next.
Local Government Provisional Order (No. 20) Bill (by Order),
Second Reading deferred till Thursday.
Local Government Provisional Order (No. 11) Bill (by Order),
Second Reading deferred till Thursday, at a quarter-past Eight of the clock.
Government Departments Securities
Return presented relative thereto [ordered 22nd April; Mr. Montagu ]; to lie upon the Table, and to be printed.
Civil List Pensions
Copy presented of List of all Pensions granted during the year ended 31st March, 1914, and payable under the provisions of Section 9 (1) of the Civil List Act, 1910 [by Act]; to lie upon the Table, and to be printed.
GREEK NATIONALITY LAW MISCELLANEOUS, No. 4, 1914
Copy presented of the Greek Nationality Law, No. 120, 2nd (15th) January, 1914 [by Command]; to lie upon the Table.
Trade Reports (Annual Series)
Copy presented of Diplomatic and Consular Reports, Annual Series, No. 5297 [by Command]; to lie upon the Table.
Electric Mains Explosions (Departmental Committee)
Copy presented of Report of the Departmental Committee appointed by the President of the Board of Trade to inquire into the question of Electric Mains Explosions [by Command]; to lie upon the Table.
County Courts Act, 1888
Paper laid upon the Table by the Clerk of the House:—Copy of Order made by the Lord Chancellor, dated 12th June, 1914, under Section 45 of The County Courts Act, 1888, directing that Richard Henry Beaumont shall not practice as a Solicitor [by Act].
Financial Statement (1914–15) (Revised Estimate)
Copy ordered "of revised Estimates of Revenue and Expenditure for the year 1914–15, with an Explanatory Memorandum."—[ Mr. Montagu. ]
Copy presented accordingly; to lie upon the Table, and to be printed. [No. 293.]
East India (Excise Administration Advisory Committees)
Address for Return "showing for each province ( a ) the names of municipalities in which committees have been appointed; ( b ) the number of official and non-official members, respectively, of each committee; ( c ) the number of occasions upon which each committee has met during the past three years; ( d ) the number of licences in respect of which each committee has recommended (i.) withdrawal, (ii.) change of site; and ( e ) the number of licences in respect of which the recommendations have been carried out."—[ Sir Herbert Roberts. ]
Emigration and Immigration
Copy of Tables presented relating to Emigration and Immigration from and into the United Kingdom in the year 1913 (being a Statistical Account of the Passenger Movement between the United Kingdom and Places Abroad), together with Report to the Board of Trade thereon (in continuation of Parliamentary Paper, No. 183, of Session 1913).—[ Mr. Burns. ]
New Writ
For the University of Oxford, in the room of the Right Hon. Sir William Reynell Anson, baronet, deceased.—[ Lord Edmund Talbot. ]
Oral Answers to Questions
Questions
Persia
asked the Secretary of State for Foreign Affairs, whether he has official knowledge of a statement made by M. Sazoneff to the effect that order and relative tranquillity have been restored in the Azerbaijan province of Persia; that the new Russian intervention is not military at all, but has now taken the form of a wide-reaching assumption of administrative functions; and, if so, whether he has made already a friendly protest to Russia on the ground that a wide-reaching assumption of administrative functions in Persia by one of the signatories of the Anglo-Persian Convention of 1907 is not in accordance with either the letter or the spirit of that Convention?
The answer to the first part of the question is that M. Sazonow stated in the Duma that order, in the stability of which he had not much faith, had been established in Azenbaijan owing mainly to the presence of Russian troops. With regard to the remainder of the question, as I stated in reply to questions from the hon. Members for Stirling and West Leeds last Tuesday, I have made a communication to the Russian Government, and pending the receipt of their views I cannot make a further statement.
asked the Secretary of State for Foreign Affairs whether he can now lay further Papers on Persia; and whether he can arrange that the Papers will come down to date?
Papers on the affairs of Persia were laid as recently as two months ago, and I cannot promise further Papers at present. With regard to the date of Papers laid, it may be well to point out that the distances to be covered, and the commuications to be made with foreign Governments inevitably cause some delay in publication.
asked the Secretary of State for Foreign Affairs whether his attention has been called to recent reports alleging the failure of the Swedish gendarmerie in Persia; whether the information in his possession goes to confirm these reports; and whether the British Government have any intention of offering the services of British officers to the Persian Government for police work?
My attention has been called to an article in the "Times" on this subject, and also to a statement by the hon. Member that that article was inspired by the Foreign Office. The statement made by the hon. Member is absolutely untrue, and until he withdraws the charge that we are inspiring attacks in the "Times" or in the Press at all upon the gendarmerie under Swedish officers, he cannot expect me to make further explanations to him upon the subject.
Armenian Vilayets
asked the Secretary of State for Foreign Affairs the nature of the administrative powers accorded to the Inspector-General under the new reform scheme for the Armenian vilayets, and whether he will publish the reform scheme itself at an early date?
I am expecting a formal communication from the Turkish Government in regard to the powers of the Inspectors-General. As soon as it is received I shall be in a position to make public the details of the reform scheme.
Can my right hon. Friend say whether the Commissioner would have control of the gendarmerie?
Perhaps my hon. Friend will give me notice of the question.
Bulgaria, Greece, and Servia
asked the Secretary of State for Foreign Affairs whether, following his intention to defer the publication of Reports on the civil and religious liberties in the territories lately acquired by Bulgaria, Greece and Servia till further time has been granted for making the assurances of those States effective, His Majesty's Government will defer its recognition of the recent annexations till those assurances have not only been given but have been reported by His Majesty's Consuls to be effective in practice?
I do not think there are sufficient grounds for taking such a course, and I am not sure that it would best secure the object which my hon. Friend has in view.
Will the right hon. Gentleman consider whether it would be possible now to publish the Consular Reports regarding those districts?
I gave a full answer, I think, last Thursday on that point.
Trans-Persian Railway
asked the Secretary for Foreign Affairs whether the policy regarding the Persian Gulf announced by Lord Lansdowne in 1903, and other previous declarations of British policy respecting the special interests of Great Britain in the Gulf, which were reaffirmed in his dispatch of 29th August, 1907, attached to the Russian Convention of that year, are still adhered to by His Majesty's Government; and, if so, whether, considering that the construction of the Trans-Persian railway on a Russian or any other foreign gauge and largely under foreign control from the North of Persia to any Persian port on the Persian Gulf would be opposed to those declarations, he will give an assurance that the construction of such a railway South of the Russian sphere in Persia will be resisted with all the means at our disposal?
The answer to the first part of the question is in the affirmative. In reply to the second part, I would refer the hon. and gallant Member to the answers given to him on the 25th May and the 11th instant. All that is under consideration at present is an application for an option for a railway across Persia. It is very undesirable on commercial grounds that railways should be made from the North into Persia without railway access also being provided from the South coast into Persia. This can only be done effectively by some through communication from the North of Persia to the coast of Persia. It is undesirable that this should be arranged without our participation; it is also undesirable that we should participate without conditions as to alignment, gauge, control, and other matters.
Is it not of equal importance that goods should run into the South of Persia from India as that they should run into the North of Persia from Russia?
Yes, Sir; but the hon. Member's supplementary question relates to the Trans-Persian railway, which will be linked up with the Indian railways. I have already stated that the question of linking up the Trans-Persian railway with the Indian railways is a separate question and a separate subject upon which statements will have to be made before it is finally decided upon. I have answered this question on the assumption that it refers only to a Trans-Persian railway beginning and ending in Persian territory.
Will the hon. Gentleman consider the second alternative in connection with the first alternative? My question was as to a through railway connecting right up with India.
As I have said, the linking up is a separate question which must be dealt with at a separate stage. At present we are considering the question of applying for an option for a line of railways which shall end in Persian territory.
With regard to the second part of the question, it may be too late to raise it after the first has been decided. We want to get right through to India.
That contingency will be borne in mind. It is a very serious matter which requires further consideration before we are actually committed.
Does the scheme provide for going down to the Persian Gulf at or near Bunder Abbas?
The option for the Trans-Persian railway will provide for a line starting in North Persia and laid down to the coast, ending at or near the sea.
India
Excise Administration
asked the Under-Secretary of State for India when the dispatch of the Government of India with reference to the representations upon questions of Excise administration submitted by the deputation which waited on the Secretary of State for India on 18th July, 1912, will be presented to Parliament; whether the replies of the local Governments will be included in the Papers; and whether these Papers will be available to Members of the House before the Debate upon the Indian Budget takes place?
The Secretary of State hopes to present the Government of India's dispatch, and to place copies of the local Governments' replies in the Library at an early date, well in advance of the Indian Budget Debate. It is also intended formally to present the replies of the local Governments, but it may not be possible to procure the required number of copies before the time of the Debate.
Victoria Memorial, Calcutta
asked whether the marble from Rajputana required for the Victoria Memorial at Calcutta is being brought free on Government railways; if so, how many transhipments, due to change of gauge or other causes, are necessary during the transit; how many miles is the total distance from the quarries to Calcutta; and whether the total cost of this service up to date can be stated?
I understand that the companies working the railways by which the marble is carried have granted concessions in respect of the charges, but I have not full details. Only one transhipment is necessary. The whole distance from the quarries to Calcutta is about 800 miles. The total cost of carriage up to date cannot be stated.
Abetment of Murder (Savarkar)
asked whether Savarkar is kept in chains in the Andamans; and whether a petition for a remission of the remainder of his sentence would now receive consideration?
I have no grounds for thinking that Vinayak Savarkar has committed any of the offences against prison discipline which might lead to the temporary imposition of chains, but I will inquire. Convicts are not kept in chains except for prescribed periods as a special punishment. The Secretary of State sees no reason for the exercise of special clemency towards this man who was convicted by the High Court of abetment of the murder of Mr. Jackson.
Are we to understand from that reply that no petition for the treatment of this man, who is imprisoned for importing arms into India, will receive any consideration from the Government, while those who committed an exactly similar offence in Ireland are absolutely allowed to go scot free?
The hon. Member has been told already that the offence with which Savarkar was charged, and, for which he was convicted, was abetting murder. Under these circumstances I cannot hold out any hopes to the hon. Member.
Is this the only difference, that in India Savarkar's trial did result in the commission of murder, but that in the North of Ireland there has been no such result?
Police Officers (Salaries)
asked whether the Secretary of State is aware that police officers of from twenty to twenty-six years' service are drawing the same pay (Rs. 900 a month) which officers of the Public Works, Forests, and Telegraph Departments draw after only thirteen years' service (under the annual incremental system granted to those Departments), although it is admitted that the work of the police officers is at least equally onerous and responsible; and whether he will take steps to remove this grievance and communicate the result to the House?
The salaries of Indian police officers depend on the vacancies occurring in the higher grades, and therefore are not comparable with the salaries of officers in Departments where a time-scale prevails. There are also other differences of which account has to be taken. The Secretary of State is not prepared to consider the matter until the Royal Commission on Indian Services has reported.
Is the hon. Gentleman aware that police officers in all the Provinces have memorialised the Viceroy of India to be put on the same footing as the officers in the Department of Public Works and Forests?
As a Royal Commission is sitting on this matter, which is very suitable for them to consider, I cannot make any further statement.
Is the hon. Gentleman aware that there is a very strong feeling on this subject among these officers in India?
I will represent the matter to the Secretary of State.
Mineral Oils (Native States)
asked whether, before the Government of India grant any concession for exploring and developing the mineral oil resources of any of the Native States or Protectorates, a Committee, Parliamentary or otherwise, will, in the first instance, be appointed to hear separately and to receive proposals from strictly British firms with wholly British directorates and make recommendations?
It is the policy of the Government of India to confine concessions in respect of oil-fields to companies under the control of British subjects. An inquiry such as that suggested by the hon. Member would therefore appear to be unnecessary.
Regimental Commands
asked what steps are being taken to compensate those officers of the Indian Army whose prospects have been adversely affected by the rules for command of Indian regiments which were introduced in December last?
The question is still under consideration in communication with the Government of India.
Can the hon. Gentleman say how long the matter is likely to be under consideration?
Steps are being taken, but I cannot fix any date.
Frontier Operations
asked whether it is the intention of the Government to allow service with the Tantok column, which successfully carried out operations against some Naga tribes in Assam in February and March, 1913, to count as war service for the forces engaged in it?
Questions
The matter has been referred to the Government of India, and their reply is awaited.
Anglo-Persian Oil Contract
asked whether the Government of India has been consulted concerning the possible political, economic, and strategic effect upon India of the proposed purchase of shares in the Anglo-Persian Oil Company; and, if so, what is their official opinion upon those points?
I would refer my hon. Friend to the answer given to him yesterday by the Prime Minister, and to that given to the hon. Member for East Mayo by the First Lord of the Admiralty.
Have the Government of India willingly accepted responsibility for this extension of its responsibilities right through South Persia and up to the Turkish border?
I think that the ground is covered by the replies to which I have already referred.
Civil Service Appointments
asked the Chancellor of the Exchequer whether it is the intention of the Treasury to observe strictly the letter and the spirit of the recommendations of the recent Report of the Royal Commission on the Civil Service in connection with the appointment by nomination of persons to positions on the permanent establishment, especially as regards appointments in the Board of Trade and the Board of Agriculture; will he say what steps he proposes to take with a view to giving effect to the recommendations of the Royal Commission on this point and to securing that the claims of the existing staffs shall be fully considered when new appointments by nomination are being contemplated; and if at the present time any such appointments are before his Department for consideration and determination?
The recommendations of the Royal Commission on this subject are under the consideration of the Government, and I am not at present in a position to make a statement as to the future policy to be adopted. I am informed that the answer to the last part of the question is in the negative so far as the Departments named are concerned.
Stonehouse School Board
asked the Secretary for Scotland if his attention has been directed to alleged victimisation of Mr. Alexander Anderson, M.A., of Stonehouse, by the school board of that place; if he is aware that a public meeting has been held and a petition presented against the action of the board in passing over Mr. Anderson when making a new appointment; if he is aware that allegations have been made that Mr. Anderson has been passed over because of his political opinions; and if he will make inquiry into the matter?
I am in communication with the school board with regard to this matter. I would, however, remind the hon. Member that, in terms of Section 55 of the Education (Scotland) Act, 1872, the right to appoint teachers of public schools rests with the school boards concerned who, in this matter, are responsible to their constituents and not to the Scottish Education Department.
Has the right hon. Gentleman received this petition yet?
No, Sir, I have not.
Can the right hon. Gentleman say what reply he received from the school board?
I have not received any reply yet.
Taransay Raiders
asked the Secretary for Scotland whether he has any information to the effect that the Taransay raiders have commenced building operations in the peninsula of Ardvanish; and whether he proposes to interfere with them?
I have not received any information to the effect indicated, and am having inquiries made.
Has my hon. Friend taken into consideration the advisability of lending these men money to enable them to build their houses?
I must know more of the circumstances before I can make any promise, but I will take it into consideration.
Federated Malay States Railways
asked the Secretary of State for the Colonies whether the senior or the subordinate officers of the Federated Malay States railways have had their salaries increased since 1900 on account of the general rise in prices; and, if so, on what occasions, and by how much?
My right hon. Friend regrets that it is not possible without excessive labour to supply the detailed information asked for by my hon. Friend. Moreover, even if such a statement were prepared it could not indicate how far the variations in emoluments which have occurred have been determined by the rise in prices, and how far by the substitution of sterling for dollar salaries, the establishment of a fixed value for the dollar, or the increase in the work or responsibility attaching to an office.
Can the right hon. Gentleman say without going into details whether there has been any increase in the salaries since 1900?
Perhaps the hon. Gentleman will put that down on the Paper.
Indentured Labour (Crown Colonies)
asked the Secretary for the Colonies whether he has yet received the Report of Mr. Chinmaulal on the system of indentured labour in British Crown Colonies from the Indian Government; and, if so, when he proposes to communicate the results to the House?
My right hon. Friend has not yet received the Report to which the hon. Gentleman refers. The second part of the question should be directed to the Under-Secretary of State for India.
Steamship "Komagata Maru."
asked the Secretary for the Colonies whether he can give the House any information regarding the position of the "Komagata Maru," and whether this steamer has started for Japan with her Hindu passengers?
My right hon. Friend understands from the Press that the "Komagata Maru" has not yet started.
Can the hon. Gentleman, on behalf of the Secretary of State, give any information regarding the extraordinary and difficult situation which has been created by the present situation?
I am sorry I cannot say more than that the ship has not yet started.
In view of the gravity of this question, and the interest it has excited through the British Empire, will the hon. Gentleman take steps to ascertain the exact position so as to give an answer to-morrow?
Perhaps the Noble Lord will put that question on the Paper.
That will mean Thursday.
Victoria Tower Gardens
asked the hon. Member for St. George's-in-the-East, as representing the First Commissioner of Works, what is the reason for the delay in reopening the Victoria Tower Gardens to the public; and whether, in view of the hardship involved in the exclusion of the children in the neighbourhood who have no other suitable playground, he will arrange for the gardens to be thrown open at least temporarily during the summer months, leaving any further necessary work to be completed in the winter?
The First Commissioner proposes to open the gardens next week.
Post Office
Importation of Arms, Dublin
asked the Postmaster-General (1) if Mr. Flood is an overseer in the employment of the Post Office in Ireland, Dublin district; or, if not, what are his duties and at what salary; and (2) if he is aware that on the morning of Monday, 7th June, a man called Flood, in the employment of the Post Office in Dublin, was detected at Kingstown, on the arrival of the mail boat from Holyhead, as endeavouring to bring into Ireland 3,000 rounds of rifle ammunition then in his possession; if the said Flood gave the Customs authorities a false name and address; if the said Flood is a member of the National Volunteers; and if the postal authorities are going to take any and, if so, what action in the matter?
The officer referred to is an overseer in the Dublin Post Office. He states that the cartridges in question—all of which were pistol or revolver cartridges—had no connection with his membership of the National Volunteers. His action in giving a false name and address to the Customs authorities was highly reprehensible, and I propose to take suitable disciplinary notice of it.
Is the number of 3,000 rounds correctly given in the question?
Yes, I believe so.
Why does the right hon. Gentleman propose to penalise this poor man?
Simply because he gave false information to the Customs officer as to who he was and what he was doing.
Why should he not in the case of Ireland?
Second-Class Engineers
asked the Postmaster-General what further steps he proposes to take to meet the complaint of the second-class engineers who were denied admission to the new class of assistant engineers on the Revision in 1911 and were made redundant, and passed over in favour of university men of much shorter service, and whose case was not dealt with in the Holt Report; will he state the results to date of the further consideration promised to their claims in February, 1912; will he say how many of the redundant men have been transferred to the new class in pursuance of his promise of August, 1912; was their seniority restored; what is the number still left redundant; whether any and, if so, how many of them have been performing duties which approximate to those of the assistant engineers; what are the prospects of those whose promotion to the second class has now been blocked for nearly three years through the method of selection adopted by the Department; and, with a view to securing contentment in the staff, can he give any assurance that no more outside appointments will be made until the claims of all competent officers passed over have been dealt with?
The claims of those second-class engineers who are regarded as suitable for promotion are considered as vacancies occur. No other measures are practicable at present. In December, 1912, forty-two second-class engineers were promoted to the class of assistant engineers, and, as the vacancies which these officers filled were created under the Revision, the promoted men retained their seniority. Since December, 1912, ten second-class engineers have been promoted to the class of assistant engineers. They were advanced to vacancies arising subsequent to the Revision, and their seniority wes determined by the date of their promotion in accordance with the ordinary practice. There are seventeen redundant second-class engineers who, it is thought, may be found suitable for advancement when opportunities occur. Some of them are performing duties which approximate to those of assistant-engineers. The exact number could not be ascertained without considerable inquiry. I cannot give the assurance asked for by the hon. Member.
Will the case of these second-class engineers be referred to the new Committee or tribunal that is to be set up?
No, Sir. It does not arise out of the Report of the Holt Committee at all.
asked the Postmaster-General whether, in connection with the engineering revision of 1911, long service engineering officers who had been certified by the Civil Service Commissioners for the second class of engineers were informed that they would block places on the class of chief inspectors, who are a lower class while ten young men who had but recently been certified by the Civil Service Commissioners as probationary sub-engineers were informed that they would block places on the new and higher class of assistant engineers; and, if so, whether he proposes to take any steps to deal with the treatment and grievances of the redundant second-class engineers?
When the second class of engineers was abolished in 1911, those who could not be promoted to the new class were allowed to retain their title and scale of pay; and their position was not affected by the arrangement under which they stood against vacancies on the class of chief inspectors. The probationary sub-engineers were recruited under a scheme of competitive examination introduced shortly before the revision of 1911, and it was necessary to reserve places on the new class of assistant engineers to which they could be appointed at the end of their probation. The claims of the second-class engineers who are regarded as suitable for promotion are considered as vacancies arise.
Fish Ponds (Bristol) Post Office
asked the Postmaster-General whether he is aware that, at the present time, a firm of electrical contractors are carrying out a cable-laying contract for the Post Office at Fish Ponds, Bristol; that under a clause of the agrement upon which the tender is accepted this firm are required to accept the Fair-Wages Clause, which binds them to the recognised town rate of labourers' pay; that they are accordingly paying the labourers employed upon the work at the rate of 6½d. an hour; that at Bedminster and in other parts of Bristol labourers employed under the Post Office direct are receiving only 5¼d. and 5½d. an hour for the same class of work; and whether he will explain why the Post Office Department, as public employers of labour, pay their own workmen at least 1d. an hour below the rate which they compel contractors to pay in the same district and for similar kinds of work?
The rates of pay to labourers at Bristol were under consideration some time ago, and the minimum rate was raised to 5½d. an hour. I have received no reply to my request, made a month ago, that one of the associations of postal servants should furnish the details on which they based their statement that 6½d. was the minimum rate paid by public bodies in Bristol to labourers. In any case, I should point out that, whereas in outside employment fixed wages are usually paid and such privileges as annual and sick leave with pay are not granted, employment in the Post Office qualifies for various privileges, and the men are eligible for periodical increases up to 7d. an hour, and for promotion to the class of skilled workmen, with good prospects of established appointments. The whole question, however, of the minimum pay of labourers in particular towns is at present engaging my attention.
Does not the question raise the question of the Fair-Wages Clause, and has it been insisted on; and, in the case of contract work, can the men ever become established men?
I do not think that that arises out of this particular question, which raises issues regarding the general pay of labour. It does not arise out of the Fair-Wages Clause.
Metropolitan Police
asked the Secretary of State for the Home Department (1) under what circumstances, in respect of station officers, a deviation is made from the eight hours' system generally in force throughout the Metropolitan Police; and (2) how many station officers of the Metropolitan Police force are at present called upon to perform nine and twelve hours' duty on alternate days; and how many men it would be necessary to add to the force to bring all these officers under the eight hours' system?
The arrangement referred to is in force at exterior stations, where, though it is necessary that a responsible officer should be available, the work is light and not continuous. At these stations officers in charge are available for any call that may arise for nine and twelve hours on alternate days, but they are not at work all the time, and the hours mentioned include one hour off for meals. The number of officers so employed is 345. Where at any station the amount and importance of the work is similar to that at the interior stations, the tour of duty is eight hours only. An augmentation of about 200 would be necessary to bring all these men under the eight hours' system.
When these officers have been working twelve hours "spread-overtime," do they get any extra pay?
I am afraid I should have to read my answer again to the hon. Member to make it clear to him that it is not a case of overtime.
I said "spread-overtime."
It is not overtime, spread or otherwise.
If these men are called upon to work for twelve hours with all their short time in between, is it not recognised in terms of labour as "spread-overtime"?
The purport of the answer I have given goes to show that it is not continuous work for twelve hours.
asked the Home Secretary if his attention has been called to the action of the police in connection with a case tried at the Westminster Police Court on the 17th instant, when a man named Gibbs was charged with obstructing a constable in the execution of his duty, when it was proved that the constable interfered with the man and not the man with the constable; whether he is aware that in certain districts policemen are using threatening and insulting language to men who are doing picket duty, and are practically inciting them to commit breaches of the peace; and whether he will take steps to prevent a repetition of actions of this kind by the police?
My attention has not previously been drawn to the case. I find on inquiry that the facts are not as suggested in the question. The constable was sent for by a responsible person to deal with an alleged case of intimidation, and he would have failed in his duty had he not made inquiries. While he was doing this, William Gibbs interfered, and tried to stop his asking questions of the person who was said to be intimidated. It would appear that Gibbs' interference did not, in the magistrate's opinion, amount to obstruction within the Statute; but this does not justify the suggestion that the officer was guilty of any improper conduct. I am not aware that the police officers in any district are interfering unnecessarily, but I shall be happy to inquire into any specific case which the hon. Member may bring to my notice.
Is the right hon. Gentleman aware that on some of these jobs the policemen themselves have decided that not more than one picket shall be allowed. [An HON. MEMBER: "Quite right, too!"] It may be quite right from your standpoint.
No, Sir, I am not aware of any case of the kind. If my hon. Friend will bring to my notice any case of alleged improper action on the part of the police, I will make inquiries.
I will give you one at Camden Town to start with.
Women's Social and Political Union (Meetings)
asked the Home Secretary whether the owners of certain public halls have been approached by the Government or police with reference to the meetings therein of the Women's Social and Political Union, and with a view to prevent such meetings being held; and, if so, under what Statute or otherwise such action has been taken?
Crimes and outrages are believed to have followed the incitements to violence which have been made in speeches by members of the Women's Social and Political Union using public halls. It has been deemed advisable by the police to warn the owners or lessors of such halls of the possible consequences to themselves that may result from the facilities thus afforded by them.
Under what Act of Parliament do they render themselves liable for the speeches made?
Under no Act of Parliament, but under the ordinary exercise of common sense.
White Star Liner "Baltic" and Steamship "Clarrie" (Collision)
asked the President of the Board of Trade whether he is aware of the circumstances of the collision which took place on the 22nd May last between the White Star liner "Baltic" and the coasting cargo steamer "Clarrie"; what is the dead weight tonnage of the "Clarrie"; whether the "Clarrie" carried a master and one officer only, both uncertificated; whether he can give the wages of these men as figuring on the ship's articles; whether there was only one engineer, and he uncertificated, and one fireman, the total crew of the vessel at the time being four only; whether at the time the only man on the deck of the "Clarrie" was the officer at the wheel; whether the wheel was situated in the after part of the vessel; whether the officer was endeavouring to perform at one and the same time the duties of steering the ship, keeping the look-out, blowing the whistle, and supervising the side lights; and, if so, whether he will consider the necessity for the introduction of the Merchant Shipping (Certificates) Bill for the purpose of enforcing regulations for the proper officering of coasting cargo vessels?
In view of the possibility of litigation in the case referred to in the hon. Member's question, my right hon. Friend prefers to make no statement as to the facts at present. As regards the last part of the question, he hopes to have an opportunity of introducing a Bill on the subject of certificated officers in the course of the present Session.
Will the right hon. Gentleman be in a position to say whether the facts are true or not if I repeat the question on Monday?
Not while it is under litigation.
Royal Navy
Greece and Turkey (Loan of Officers)
asked the First Lord of the Admiralty whether any British naval officers have been lent to Greece or to Turkey, or to both, in order to educate the sailors of these nations in naval warfare; and, if so, will he say whether this is done in the interests of peace in the Near East?
At the request of the Governments concerned, and with the concurrence of the Foreign Office, naval missions have been sent both to Greece and Turkey for the purpose of assisting in the reorganisation of the navies of these Powers. Whether the development of naval efficiency by modern States is a factor for keeping or breaking the peace depends on the circumstances of each case, and no doubt the question would in each case lead to differences of opinion. It is not to be supposed, however, that these countries would have remained without any naval organisation if British assistance had been refused them.
Was it in the interests of peace that the right hon. Gentleman carried out this transaction?
Everything that I have ever done has been in the interests of peace.
Is it the case that Germany has supplied the Army mission?
Yes; I believe so.
Is that also in the interests of peace?
Will the right hon. Gentleman give equally favourable treatment to the Turks and see that they get equally as good officers as the Greeks?
I believe that both countries are entirely satisfied with the officers who have been sent.
Coal and Oil Fuel
asked whether the Admiralty has conducted an investigation as to the coal areas which are likely to be the most promising for distillation purposes; and whether any steps will be taken to secure in the future an adequate supply of coal for distillation from those areas?
The Admiralty has accumulated considerable information on the subject referred to in the first part of the question. As the scientific distillation of coal and the organisation of the industrial use of the various products so obtainable are still in a comparatively early stage, there is much information yet to be acquired; the Admiralty is not losing any opportunity of adding to its knowledge and will do what reasonably can be done in the matter. The Admiralty has made it their practice to inspect processes and plant whenever invited to do so. In reply to the second part of the question, there is no reason to suppose that adequate supplies of the raw material will not be forthcoming. The real problem, apart from any further improvement of distilling processes, is how best to secure the economical industrial use of the various products of coal, particularly of the solid residue or coke. Action by the Admiralty in promoting the supply of oil from coal for naval purposes can at the best be only a partial contribution to the solution of the problem. The serious attention and co-operation of large producers and larger users of coal and other fuels are essential. In time of war the economical disposal of certain products might to some extent be sacrificed to the more urgent consideration of supplementing our reserves by a larger proportion of home-produced oils. The Admiralty have for a long time past had this in view and have already taken some effective steps to that end. In normal circumstances, however, the problem must be approached on all its sides and not only on that of Navy fuel to secure a sound economic solution.
Is the right hon. Gentleman aware that already certain French and German syndicates own large areas in the South Wales coal-fields, and if further syndicates set to work to obtain coal on a large scale with a view to supplying oil to Germany, France, and Italy, would the Admiralty in this country raise any objection?
The best coal that is distilled for oil, unfortunately, is not Welsh coal.
Should syndicates take the best areas in the country, would the Admiralty raise any objection?
asked the First Lord of the Admiralty whether he can state the total value of Cardiff coal and the total value of oil fuel, respectively, consumed by the Admiralty in each year since 1907–8?
It would be contrary to Admiralty practice to give the figures asked for, but the average demand of the Admiralty upon the best classes of Welsh steam coal does not exceed from a tenth to a twelfth the total output.
asked whether large reserves of oil fuel will be stored somewhere along the Bristol Channel or elsewhere on the Welsh coast?
The Admiralty policy as regards accumulation of oil reserves may in time necessitate provision of stocks on the West coast, but no particulars can be furnished.
Accountant Branch
asked if the Committee appointed to inquire into the v pay and conditions of service of the accountant branch of the Navy have reported; if any recommendations for improvements in the conditions of service of this class were made by the Committee and, if so, the additional expenditure involved; and if effect has been given to any of such recommendations; and, if so, to what extent?
As I have already stated, the Report of the Committee is at present under consideration, and no decision on its various recommendations has yet been arrived at.
Will the full Report be eventually issued?
I cannot say.
Naval Barracks (Chatham)
asked the Secretary to the Admiralty what method is adopted by the commanding officer of the Royal Naval barracks at Chatham when allotting cabins for chief commissioned and warrant officers; whether there are any such officers at present in barracks enjoying the double privilege of having a cabin and also compensation allowance; whether the usual seniority rule is strictly adhered to when the above-named officers are allowed the privilege of getting the compensation allowance; and, if not, will he see that seniority governs in both cases, in allotment of cabins and in being placed on compensation allowance?
As far as possible cabins in the Royal Naval barracks, Chatham, are allotted to commissioned warrant and warrant officers in order of seniority, but as all available cabins are, as a rule, filled, a new officer on joining probably has to be placed in the cabin vacated by his predecessor in order to avoid disturbing officers already in occupation of cabins. This is in accordance with the King's Regulations. There are no warrant officers in the Royal Naval barracks, Chatham, enjoying the double privilege of a cabin and lodging allowance. As regards the allocation of lodging allowance the order of seniority is adhered to, except in the case of two commissioned warrant officers whose duties necessitate their employment outside the barracks.
Anglo-Persian Oil Company Contract
asked the First Lord of the Admiralty whether he will stipulate for all British crews under trade union rates and conditions in all the vessels carrying oil for the Anglo-Persian Oil Company?
On referring to paragraph V on Page 5 of the Explanatory Memorandum contained in the Parliamentary Paper circulated, the hon. Member will see that the contract with the Anglo-Persian Oil Company is for oil only, and the Admiralty will make its own arrangements for freight. It is expected that a considerable proportion of the supplies will be carried in vessels owned and manned by the Admiralty with British crews, and the remainder in vessels under transport time charter to the Admiralty. Such vessels are required to be under the British flag, and to be manned by British subjects engaged in accordance with the Fair-Wages Resolution of the House of Commons (10th March, 1909).
Will the right hon. Gentleman see in the case of transports that there is not an undue proportion of Lascars to British seamen employed?
I do not think I can go beyond the Fair-Wages Resolution of the House of Commons of 10th March, 1909.
Considering the terrible heat of the Persian Gulf in the hot weather, would it be advisable to put any limitation on the employment of Lascars?
They are British subjects.
Questions
Income Tax
asked the Prime Minister whether he will consider the desirability of the appointment of a Commission to inquire into the working of the Income Tax law?
Yes, Sir. As has already been stated the matter is already receiving consideration.
Government of Ireland Bill
Volunteer Forces
asked if the Irish Executive will have the control of the Irish Volunteers in that part of Ireland which may ultimately be under the Government of Ireland Bill; and will the Executive have power to apply any part of the £500,000 subvention towards the expenses of such Volunteers?
As regards the first part of the question, I would refer the hon. Member to Clauses 2 (Subsection 3), 4, and 30 of the Government of Ireland Bill. The answer to the second part is in the negative.
In case this money is used by the Irish Executive improperly, is there any power to stop payment of it?
The provisions of the Bill provide ample safeguards in this matter.
What provisions are there in the Bill to prevent improper misapplication of money?
I have referred to them already.
asked the Chief Secretary for Ireland whether he has any official or other information which will enable him to state to the House under what flag Irish National Volunteers are being drilled and trained; and, if so, whether he will make a statement accordingly?
My right hon. Friend has made inquiries with regard to this matter, and the information that he has received from the police is that no flags are used except small ones for signalling. On several occasions the Limerick City Volunteers carried a green flag with a gold harp in the centre.
May I ask the right hon. Gentleman whether there was any crown on that flag?
If the hon. Member desires any further information, perhaps he will kindly put a question on the Paper?
Is there any truth in the rumour that the Ulster Volunteers are now being trained under the three brass balls?
May I ask the right hon. Gentleman whether his attention has been called to the fact that on the roof of this Chamber there are a number of shields bearing the Irish harp in gold exactly like those complained of by the hon. Gentleman?
Questions
Public Trustee
asked whether the Public Trustee now controls £50,000,000 of investments; whether he is solely responsible for the investment of this sum; whether he has indicated that it might be advisable that he should have the assistance of a consultative Committee; and whether it is the intention of the Government to see that there is some authority accountable to Parliament to share the responsibility for the Department of the Public Trustee?
I understand that the answer to the first three branches of the question is in the affirmative. The Government will consider the suggestion, contained in the last branch.
Motor Traffic
asked when the House will have an opportunity of discussing the Report of the Select Committee on Motor Traffic, which sat last year?
I am afraid that I am unable at the present time to give any promise in this matter.
Redistribution Bill
asked if it is proposed to introduce a Bill to deal with Redistribution during the present Session, or, in any event, in time for it to take effect before the Plural Voting Bill comes into force?
I can add nothing to the very full statements made on the subject by my right hon. Friend the President of the Board of Education on the 15th June.
Will the right hon. Gentleman have any objection to adding a Clause to the Plural Voting Bill that it shall not come into operation until there has been a Redistribution of seats?
The Bill has passed out of the control of this House.
Cannot the right hon. Gentleman, by means of the Suggestion stage, add that Clause, if it is agreed, to the Plural Voting Bill?
It has gone to the House of Lords.
When it comes back from the House of Lords?
The House of Lords can make any Suggestion they please.
Will the right hon. Gentleman accept it?
Wait and see.
Is it not a fact that the Minister of Education said with regard to the Plural Voting Bill that a Redistribuion Bill can be brought in at the same time?
It is open to anyone to read it.
Has the right hon. Gentleman read the speech, and does he agree with the statement?
I agree with every word of my right hon. Friend's speech.
Moneylenders Bill
asked the Prime Minister whether he is aware that the Moneylenders Bill has gone through all its stages in the House of Lords; and whether, in view of the public opinion in favour of such a measure being passed, he is prepared, under the circumstances, to give it facilities during the present Session?
If I could be assured that this Bill would be substantially unopposed I would be glad to consider giving facilities for its passage into law.
British Army
Eyesight Test (Candidates for Commissions)
asked the Under-Secretary of State for War if can- didates for commissions in the Army are called upon, after passing the necessary entrance examinations, to undergo a test for eyesight; if he can state how many persons were rejected for defective eyesight in 1913; and what are the reasons for making a test, which is in the nature of a preliminary qualification, after the candidates have incurred all the expense and labour entailed by the theoretical examinations?
The answer to the first branch of the question is in the affirmative. The number rejected for defective eyesight in 1913 was twelve. As regards the third part of the question, the test cannot, in the interests of the service, be dispensed with; but, in order to obviate disappointment, candidates are recommended in the published Regulations to undergo a preliminary medical examination, and, on payment of certain fees, they are allowed to present themselves to a military Medical Board for this purpose.
Do they go through the eye-testing examination before they pass their regular examination?
They are allowed to go through the preliminary medical examination. That does not dispense with the other.
At what period do they have that examination?
That depends on each individual. What I wish the hon. Gentleman to realise is that it does not dispense with the final examination before the man joins the Colours.
Does the right hon. Gentleman realise that the point is whether it is worth their while to prepare for the final examination?
Yes, perfectly; and that is why there is this Regulation that there should be a preliminary examination so that they may see whether it is worth their while going for the other or not.
How long before the regular examination are they allowed to do this preliminary test? Is it one month, six months, or a year?
I do not think there is any particular period.
Are they each re-examined?
Yes, they are.
Might not the preliminary examination be made sufficiently stringent to prevent the trouble and expense of a re-examination afterwards?
Of course the answer to that is that you must have a final examination before you allow an officer to join. His eyes might be completely changed in the interval.
having risen—
Hon. Gentlemen should give notice of any further questions on this matter.
Shortage of Men
asked how much is being saved each month owing to the shortage of men in the Regular Army compared with the number of men voted; and how the money saved on this head is being dealt with by the Treasury?
As the shortage on the full numbers in Vote A was taken into account in estimating the Money Votes, the saving referred to does not exist.
Questions
School Playgrounds
asked the President of the Board of Education whether notices were recently issued to certain schools threatening them with compulsory closure unless they made extensive additions to their playgrounds; if so, what were such schools; and under what provisions of law such notices were issued?
The Board of Education frequently call the attention of local education authorities and managers of schools to the importance of providing adequate playground space for public elementary schools and to cases in which the playground space is deficient, and where there are no playgrounds at all the Board have, in the interests of the children and their efficient instruction, felt bound to press the local education authority or managers to submit proposals for early improvement of the premises in this respect. In particular, where substantial enlargements or alterations of existing schools are in contemplation with a view to rendering the premises satisfactory for an indefinite period, it is the practice of the Board to point out that the proposals, cannot be regarded as satisfactory for prolonged recognition unless adequate playground space is provided. This action is taken because it is obviously undesirable that considerable sums of money should be spent on a school if it cannot thereby be made satisfactory, and it would be unfair to the managers for the Board to countenance such expenditure. The most recent cases are contained in the lists of schools sent to the Derby County Borough Education Authority and the London County Council. In connection with this matter I may refer the hon. Member to Articles 17 and 18 of the Code of Regulations for Public Elementary Schools.
Does the right hon. Gentleman threaten to close any schools on account of the want of playground accommodation?
I have given information as to the putting of pressure on the managers and the education authorities. As I have already indicated, it is our practice to put pressure on the authorities to provide adequate playground space, because we are giving them money which cannot be efficiently spent in connection with the schools unless there are proper playgrounds.
Will the right hon. Gentleman answer the last part of the question—under what Statute does he make these requirements?
I think I may give the same answer that the Home Secretary gave earlier in the afternoon—on the ground of common sense.
May I ask whether this pressure is applied irrespective of the cost to the ratepayers themselves?
Whatever necessary expense is involved ought to be incurred with the view of providing adequate playgrounds.
Is it necessary in. every case?
Not always.
Generally?
Not very long ago a Committee reported on this matter, and their recommendations do not specify that it is absolutely necessary in every case.
Do I understand that the right hon. Gentleman's answer is that his reason is that he has only common sense behind him in the matter, and that he has not got any statutory authority?
My duty is to see that the money of the taxpayers is spent in the efficient management of these schools, and if proper accommodation is not provided by the local authorities and the managers, it is not my business, I believe, to spend the taxpayers' money in giving lull Grants to schools of that kind.
Chorley Schools
asked the President of the Board of Education whether his attention has been called to the report of the school medical officer at Chorley, especially his remark that, though the younger children in the schools are in weight and height up to the average, the boys in Chorley between thirteen and fourteen are much below the average of the boys of this country in weight and height; and whether he will instruct the chief medical officer of the Board to report on the physical conditions of school life in Chorley?
I have seen the report in question, but I do not think that the conditions at Chorley are such as to call for a special inquiry on the subject in that area. General information as to the comparative heights and weights of children of school age may be found in Appendix H of the Report for 1912 of the Board's chief medical officer.
Is it not a fact that the presence of these backward children on the average of the country is more marked in those places where half-time largely prevails?
I am looking into the figures in connection with this matter. The figures I have at my disposal do not justify me in drawing any general conclusion. I admit that in Chorley there is a large number of half-time children.
Will the right hon. Gentleman look into the matter further, with the object of seeing what is the result, if any, upon the growth and development of children?
I am trying to obtain in formation and statistics in regard to that matter.
Civil Service (Second Division Clerkships)
asked the Secretary to the Treasury, in view of the announcement of an examination for second-division clerkships to take place on 14th September next, whether steps will be taken to fill any of the vacancies by the promotion of assistant clerks, having regard to the fact that the Royal Commission on the Civil Service expressed their surprise at the paucity of such promotions, and were disposed to infer that the Order in Council (1910, Clause 45) had been interpreted with unnecessary strictness?
Under the Clause in question it is for the heads of Departments to make recommendations to the Treasury for the promotion of assistant clerks to the second division, and the Treasury has no initiative in the matter. Any such recommendations submitted will receive full consideration.
Customs Declarations (France)
asked the Secretary of State for Foreign Affairs whether he can now give any additional information as to penalties in respect of errors in Customs declarations in France?
The proposals of the French Chamber of Deputies on the subject of the margin of weight allowance for Customs declarations have not received the approval of the Budget Commission of the Senate, which has recommended the separation of the Clauses in question from the Budget and their examination by the Customs Commission. It seems probable that this recommendation will be carried out, and that even if the Clauses are adopted they will not come into force for some time.
Trade Dispute, Burton-on-Trent—Charge of Assault
I desire to ask the Home Secretary a question, of which I have given him private notice, namely: Whether his attention has been called to the case of Mr. Vale Rawlings, of Burton-on-Trent, who was sentenced to fourteen days' imprisonment for an alleged assault during a trade dispute on Inspector Oulton, of the borough police; whether the only evidence against him was that of two constables, whereas six independent witnesses were called who denied that there had been any assault; whether the magistrates who heard the case were themselves employers of labour; and whether he will order suspension of the sentence pending an investigation into all the circumstances by some independent authority?
A similar question has been asked by my hon. Friend the Member for Newcastle-under-Lyme (Mr. Wedgwood). I have not heard of the case except from a newspaper extract sent to me by him. I will make inquiry at once.
I shall raise the question as one of urgency to-night on the Motion for adjournment.
Is the right hon. Gentleman aware that this man is hunger-striking, and has been so for the last two days?
No. I accept the statement made by the hon. Member, but I have no further information about the case.
There is a full account in to-day's "Daily Herald."
Suffragist Outrages
I beg to ask the Home Secretary a question, of which I have given private notice: Whether he is aware that Mrs. Walker, of Poplar, who was recently sentenced to a month's imprisonment, is being forcibly fed, and that in consequence she is in a bad state of health; whether he can see his way to order her release; and also whether she has not been sent to prison for advocating the claims of women to have the vote?
With regard to the first part of the hon. Member's question, Mrs. Walker is not being forcibly fed. Her state of health is satisfactory, and there appears to be no reason for interference with the sentence. With regard to the last part of the hon. Member's question, I would refer him to the speech made by Mrs. Walker, in which in the plainest terms she advocated the burning of other people's houses.
Is the speech made by the lady more violent than many of the speeches made by people in other parts of the country?
Has she been imprisoned under the Statute of Edward III.?
May I appeal to the Home Secretary to make a personal investigation into this poor woman's case? She is not a criminal in the sense in which the House generally understands. She was carried away at the moment, but she is a perfectly innocent, and God-fearing woman, and really ought to have some leniency shown to her.
I had an opportunity yesterday of reading over the exact language used by Mrs. Walker, and it was an incitement to those who heard it to go and burn other people's houses. The case was properly heard, and there can be no question of her guilt.
Is it not the case that what Mrs. Walker did say was that there were no mansions to burn in the East End, but that they could make their power felt in other ways?
No. That was not it at all. She said that there were no mansions to burn in the East End or they would have been hot long ago, and she then went on to advise them to burn.
That is disputed.
Board of Agriculture (Scotland)
I beg to ask the right hon. Gentleman the Secretary for Scotland a question, of which I have given him private notice: Why the Report of the Scottish Board of Agriculture for 1913 does not contain detailed accounts of the financial position of the various estates under their management as formerly presented annually by the Congested Districts Board, and whether he will see that a supplementary Paper giving that information will be issued without unnecessary delay?
There was no special reason for omitting detailed information of the nature referred to by the hon. Baronet, except a desire that the Report should not be overburdened with detail, but I am prepared to issue a supplementary Paper containing information such as was formerly given by the Congested Districts Board.
Will the right hon. Gentleman bear in mind that this is considered to be important?
I will give the hon. Baronet the information which he wants.
Private Bills
Metropolitan and Great Northern Railway Companies Bill,
Reported [Parties do not proceed]; Report to lie upon the Table, and to be printed.
Newcastle-upon-Tyne Corporation Bill,
Skegness Gas Bill [ Lords ],
Reported, with Amendments; Reports to lie upon the Table, and to be printed.
Selection (Standing Committees)
Sir Daniel Goddard reported from the Committee of Selection; That they had discharged the following Members from Standing Committee A in respect of the Ready Money Football Betting Bill and the Prize Competitions (Prohibition) Bill): Mr. Runciman and Mr. Attorney-General; and had appointed in substitution (in respect of the said Bills): Mr. Ellis Griffith and Mr. Solicitor-General.
Sir Daniel Goddard further reported from the Committee; That they had added to Standing Committee A the following Fourteen Members (in respect of the Ready Money Football Betting Bill and the Prize Competitions (Prohibition) Bill): Mr. Alden, Mr. Hayes Fisher, Mr. James Hogge, Mr. Butler Lloyd, Mr. Lundon, Mr. O'Doherty, Mr. Perkins, Mr. Denison-Pender, Mr. Sherwell, Mr. Shortt, Mr. Snowden, Sir George Toulmin, Colonel Hall Walker, and Sir Joseph Walton.
Sir Daniel Goddard further reported from the Committee; That they had discharged the following Member from Standing Committee B (in respect of the Merchant Shipping (Convention) Bill): Mr. Secretary M'Kenna; and had appointed in substitution (in respect of the said Bill): Mr. Burns.
Sir Daniel Goddard further reported from the Committee; That they had added to Standing Committee B the following Fifteen Members (in respect of the Merchant Shipping (Convention) Bill): Mr. Barnes, Mr. Hamilton Benn, Mr. Daniel Boyle, Mr. Evelyn Cecil, Mr. Ffrench, Mr. Gladstone, Mr. Holt, Sir George Croydon Marks, Sir Henry Norman, Sir Gilbert Parker, Mr. Walter Rea, Mr. Sandys, Mr. Stewart, Sir Archibald Williamson, and Colonel Yate.
Sir Daniel Goddard further reported from the Committee; That they had added to the Standing Committee on Scottish Bills the following Fifteen Members (in respect of the Police (Weekly Rest-Day) (Scotland) Bill): Major Archer-Shee, Mr. Ashley, Mr. Baird, Mr. Blair, Colonel Boles, Mr. Clough, Viscount Dun-cannon, Sir Henry Hibbert, Mr. Hohler, Mr. John, Mr. M'Ghee, Sir Cuthbert Quilter, Sir Samuel Scott, Mr. Scanlan, and Mr. John Taylor.
Reports to lie upon the Table.
Orders of the Day
National Insurance Act, 1911. (Part Ii. Amendment).—[Money.]
Considered in Committee.
[Mr. WHITLEY in the Chair.]
Resolved, "That it is expedient to authorise the payment, out of moneys provided by Parliament, of any additional sums which may be required for the purposes of any Act of the present Session to amend Part II. of the National Insurance Act, 1911."—[ Mr. Burns. ]
Resolution to be reported to-morrow (Wednesday).
Finance Bill
Local Authorities (Additional Grants)
Order read for resuming Debate on Question [ 22nd June ], "That the Bill be now read a second time."
Question again proposed. Debate resumed.
I beg to move to leave out from the word "That" to the end of the Question, and to insert instead thereof the words "this House, recognising the immediate right of the local authorities to substantial additional Grants in aid of national services locally administered, regrets that no provision should be made in the current financial year for that purpose, and that any provision to be made in a future year should be conditional on setting up a new system of valuation for rating purposes under the control of the Land Valuation Department and subject to conditions destructive of local autonomy."
The House of Commons is making precedents in Parliamentary procedure very fast, and very bad precedents they are too! A month ago we met here to discuss in Debate the Third Reading of the most important Bill of the Session, the Home Rule Bill, and when we did so we were told "this is not the real operative Bill which you are discussing now. There is an amending Bill which will place this Bill in an entirely new light." Yesterday we met in a solemn way to discuss the Second Reading of the Finance Bill, commonly known as the Budget Bill, which had already excited a very great deal of attention in the country, particularly at by-elections, and then when we were expecting to hear an Amendment moved by the right hon. Member for Hexham (Mr. Holt) we were told "this is not the real operative Bill." The right hon. Gentleman the President of the Local Government Board (Mr. Herbert Samuel), who "devils" for the Chancellor of the Exchequer and who will always make a very good case for any financial problem, said, "You must substantiate a new Budget for the Bill which you thought you were going to discuss to-day, but I am very sorry that we cannot produce the new Budget. Owing to the King's birthday and other matters of that kind it is not printed." Yesterday we had to discuss an entirely new Budget from the point of view of the local authorities without having the figures before us. The White Paper, which is generally part of the mechanism which is placed before an assembly discussing matters of the kind, has practically disappeared and no new White Paper has taken its place. I cannot help thinking that it would have been more in accordance with Parliamentary usage if some notice had been given to the Leaders on this side that a great change of this sort was about to be announced by the Government. It was not done, and we were left in the dark until the very last moment. We thought that we were going to discuss one Budget and then we found that we were called on to discuss another Budget. That is the way in which we are always getting into a financial mess in this House. Financial irregularity succeeds financial irregularity—there is a perfect chain of them. At the beginning of yesterday's proceedings my hon. Friend the Member for West St. Pancras (Mr. Cassel) called attention to a gross irregularity in the original Budget. You, Sir, had to say that it was irregular, but that it could be cured, but only by very drastic procedure. It is not a year ago since the present Government were hauled over the coals by Mr. Speaker for financial irregularities even worse than that.
As I have said, one financial irregularity succeeds another, and I believe that that is very largely due to the fact that the present Government is always logrolling. It is always electioneering inside the House of Commons and outside the House of Commons. It is always confronted with the ghosts of its own Acts. It comes down here with the Home Rule Bill, and it is confronted with the Parliament Act ghost, which says, "You called me into being for your own purposes: here I am!" So yesterday I believe that the Government would have taken a different course but that it was confronted with the ghost of the Provisional Collection of Taxes Act, which is almost as bad an Act, in my opinion, as the Parliament Act, from the financial point of view at all events. I denounce both of them. They were confronted with the ghost of the Provisional Collection of Taxes Act, and that Act said to them, "Here I am; you have called me into being, and now you want to take a certain course in connection with the Budget, I am not going to let you." At last, even hon. Gentlemen opposite have begun to complain of the financial irregularities on the part of the Government. I do not think we have used stronger language on this side than was used in a certain letter which was printed, and which I believe was adopted by no less than fifteen Gentlemen sitting on the opposite side of the House, and who are generally called "the Radical millionaires." Whether they are Radical millionaires or not I do not know, but I entirely agree with the conclusions to which they came about the Finance Bill. They said in their letter that they wished to draw the attention of the Government to the dangerous innovation in constitutional practice involved in the Finance Bill of the year. They pointed out that the Bill was constitutionally objectionable, financially dangerous, and unfair to the taxpayer, and that it was prejudicial alike to proper finance and the effective control of the House over national expenditure.
That is very strong language, though not one bit too strong, and I congratulate the hon. Member for Hexham (Mr. Holt) on having had the courage of his opinion, and on having at last, though rather late perhaps, come forward and championed the cause of financial regularity in this House, using his influence with the Government to place their financial house in order and to revert more to the old practice of this Assembly—to which you, Mr. Speaker, alluded yesterday—instead of this new method of finance adopted by the Chancellor of the Exchequer. My only regret is that owing to the course of conduct of the Government, which has been built up to a large extent upon the attitude taken by the hon. Gentleman the Member for Hexham and his Friends, the local authorities are now to be deprived of all the Grants-in-Aid, or relief of local rates for the current financial year. That is a matter upon which I have expressed the regret of myself and my Friends in the Amendment I am now moving. I have always, personally, taken a very great interest in this question, and I have never taken up but one attitude in regard to it: that a large share of the burden which is now imposed upon the ratepayers for semi-national purposes ought to be shifted on to the general body of the taxpayers of the country. The President of the Local Government Board said, and I entirely agree with him, that personalty ought to bear a larger share of the expenditure on education, Poor Law relief, public health, and matters of that kind. The reason that I am repeating this now is that I wish to show that I am thoroughly consistent in all that I have said and done in regard to these questions. The Chancellor of the Exchequer, not long ago, in this House, made a most violent attack on my line of conduct and on certain speeches I made in the House of Commons on the introduction of the Budget of the right hon. Gentleman. I do not think that he can have read my speeches, nor do I think there is the least reason why he should, unless he is going to reply to them. Then I think it would be better that he should read them. The right hon. Gentleman said that I had opposed the Income Tax, the Super-tax, the Death Duties, Indirect Taxation, and all the methods by which money might be obtained, and by which relief might be given to the local rates. In anything I have said, there was only this criticism: that it was not sound finance to raid the Sinking Fund at the same time as you were raiding your reserves—that if you put taxation very high, if your Income Tax were very high, or your Super-tax and Death Duties were high, then at that time you ought to be rapidly paying off your National Debt.
I never expressed any opinion whatever in opposition to the Chancellor of the Exchequer so far as his Income Tax, his Super-tax, or his Death Duties are concerned. I have said, and shall say again, that I do not think it wise to increase the-Death Duties; and I have said, and shall say again, that I think it is very unfair in estates where deaths have been taking place very quickly and enormous sums of money have had to be contributed under the present system of the Exchequer. I am aware that the right hon. Gentleman is going to alter that to a small extent, but when the proper time comes I shall endeavour to persuade him that it should be altered to a still larger extent. That is the line I have always taken inside and outside this House. I was perfectly welt aware, in advocating relief of the local, rates in regard to semi-national expenditure, that money would have to be found somewhere, and I am also perfectly well aware that the money would probably be found by means of increasing the Income Tax, and very likely in screwing up the Super-tax still further, and by other means of that kind. With not one of those-methods have I personally found fault. The right hon. Gentleman would have had perhaps the right to say, when I was advocating the relief of the ratepayer, "Where will you get the money?" My answer would have been that I agreed with him in increasing the Income Tax and the Super-tax, but, personally, I have in mind other means in regard to which doubtless there would be considerable discussion, namely, that there should be an import charge on articles coming to our ports. I have always held those views. I held them at the Treasury, though I did not accept the whole position taken up by Tariff Eeformers—indeed, before Mr. Chamberlain advocated his views, I held views at the Treasury which, if carried out, would have brought under taxation many articles that now escape from taxation.
4.0 P.M.
I might remind the right hon. Gentleman the Chancellor of the Exchequer that, after all, his own Government now tax 2,200 articles coming into the Port of London. The present free import Government for the first time now tax 2,200 articles in order to obtain the money for the purpose of deepening the Thames. Why is it heresy in me, if I want to raise money for widening roads, for bettering internal communication, for education, and for matters of that kind, to tax those 2,200 articles for those Imperial purposes, while it is held to be a virtue in the present free import Government to tax 2,200 articles for the first time—articles which have never been taxed before—in order to obtain money for, among other purposes, deepening the river? I have never been able to see the distinction. If I am challenged, therefore, as to where I would get the revenue for purposes such as the relief of the ratepayers from a large share of the burden which they bear for semi-national purposes, I say that, in addition to the Income Tax and in addition to the Super-tax, undoubtedly I should get a very great deal of money from taxing for Imperial purposes those articles which the right hon. Gentleman already allows to be taxed for local purposes. I have always been thoroughly consistent in my attitude on this question. I do not regard the money of the Income Tax payers which is to be spent on services such as education as increasing the national burden The money is really a substitution of one form of taxation for another form of taxation—that is to say, so far as you relieve the local rates by adding a penny to the Income Tax—so far—unless, of course, you are using it to stimulate a further measure of expenditure—you really relieve the local rates by a penny, and you are not increasing the national burden. The same assets stand for both expenditures. To that extent the right hon. Gentleman would be perfectly right in saying that the millions he is giving for local expenditure on those services, if they are not used to stimulate new expenditure, will relieve the rates in the country. He has charged me with inconsistency: what about his own conduct? What is the whole history of this case from his own point of view? For years past he has been making the most solemn promises and pledges inside this House and outside this House to relieve the local ratepayer. He has never told the local ratepayers when they came on deputations, "I will give you relief, but you must wait and you must submit to an entirely new form of valuation and an entirely new and most fantastic form of site-value rating and matters of that kind." He never qualified his promises in that way, but he told them distinctly that he would give them relief. Then came the excuses. First of all the Balkan War was pleaded, and then a Departmental Committee, and at last the Departmental Committee did report, and as a result of that Report we actually did find substantial Grants in the right hon. Gentleman's Budget for the relief of the ratepayer, and every county council authority and every municipal authority has been on the very tip-toe of expectation ever since as to what they were going to get out of this relief, which the right hon. Gentleman himself said in the House of Commons would amount to something like 9d. in the £. The most exact figures were given. I recollect the right hon. Gentleman going down to Ipswich on a very interesting occasion and informing the electors of Ipswich that there was one very good reason why they should vote for the Government candidate, and that was that he was providing something like £15,000 per year for them in relief of rates by his Budget. Will the right hon. Gentleman go down to Ipswich again and say, "I am very sorry I promised you £15,000 per year when I wanted you to vote for my friend Mr. Masterman, but I am sorry you will get nothing now as you are not a necessitous school area, and therefore you must tear up any local budget you have constructed on the fate of the promise I made to you." The right hon. Gentleman shakes his head, but the whole of these temporary Grants disappear after the statement of the right hon. Gentleman the President of the Local Government Board.
The £15,000, of course, referred to a full year, and certainly did not refer to temporary Grants.
I read the right hon. Gentleman's speech and there was certainly nothing in it to give that interpretation, and the ordinary elector, after reading the speech, would have said, too, "I have got that amount out of this Budget," while he does not get a farthing out of this Budget of that £15,000. It was just the same with Grimsby. Every Radical paper said, "We are bound to get the votes of the shopkeepers in Grimsby, because they are simply delighted to be told that they will get" not ninepence in the pound for it was an exact figure, but "eightpence three-farthings in the pound reduction." Yet even that very exact sum in arithmetic was not attractive to the people of Grimsby, whether they learned their lesson in past times or not, and neither Grimsby nor Ipswich was seduced by those very attractive promises of the right hon. Gentleman. After all, I think the right hon. Gentleman has given away his own case and is bound to carry out his promises made in this House on the introduction of the Budget. So late as that, here is his own description of the position of the local authorities. He drew a terrible picture of their plight and of the plight of the ratepayer and he said that they intended to immediately redress the grievances of the ratepayer and continued:— Gentleman the Chancellor of the Exchequer did not only address that letter to the Committee asking them to defer their Report until they had reported on this question of valuation, but he even put a very leading question to them on this matter. Here is the paragraph in his letter. He said:—
As to the country I do not know; I dare say in the country there may not be that uniformity in assessment in which there is in London. I could not say, and that I leave other people to say. At the same time I very much doubt whether a great central authority in London would have the knowledge or experience; and the local knowledge they certainly would not have, sufficient to enable them to more or less depose those local assessment committees and take over the work which they have been doing fairly well, I believe, up to the present time. I dare say they may want stiffening from some central surveyors or surveyors with, perhaps, greater knowledge than that possessed by the locality. I really cannot say, but, at all events, if there is a case to be made out showing that there is want of uniformity in the provinces, that case ought to be made out, and thoroughly, before we commit ourselves to some very drastic form of procedure, which undoubtedly does go a long way towards setting aside local government. There is another condition which is to be attached to any form of Grant to all those county council authorities and all those municipalities which are now in this very miserable plight that, even according to the President of the Local Government Board yesterday, they cannot free themselves from the stain and stigma of not carrying out the many duties which are entrusted to them, and they are in a position which evoked his pity, and he said that many excellent projects of public health and other matters were standing still because the local authorities w ere. short of funds. I say it is very hard on them if they are to wait, possibly for years, until this very elaborate system of separating the value and the site and then the site value from the value of the buildings upon which it is completed. After all, what does the right hon. Gentleman really expect to get from that in the way of money? Who has ever told him that there is a gold mine in this site value for rating purposes? He certainly will not find that in the Departmental Blue Book. If he turns to the opinions expressed by the Minority Report of the Royal Commission, he will not find any consolation; he will not find that the Minority thought that there was any large amount of money to be obtained by the taxation of site values. On page 103 the Minority Report says:— on their programme, and constantly stated that some millions of money were to be obtained from it, but for twenty years they have never been able to produce a practicable system. It has not been for want of clever men. There were very clever men promoting the idea, but none of them has been able to bring forward a really working system which, while preserving the sanctity of contracts, would give us an equitable system by which we could raise revenue from the taxation of site values. Therefore it is very hard and cruel on municipalities and county councils, which, according to the admission of everybody, are entitled to extra Grants for such purposes as education and others which have been mentioned, that they should be kept waiting for these promises to be fulfilled until conditions such as these are established—conditions which I believe, if they are properly debated, never will be established, because the House will find that so far as the rating of site values is concerned, particularly for rating purposes, the game is not worth the candle, and that the expense is of such a character that the amount of money to be derived from it will not be worth the expenditure involved.
My Amendment complains that the Government are setting aside the local authorities. While I entirely agree with the Chancellor of the Exchequer and the President of the Local Government Board that if new Grants are to be made, and such large Grants as are indicated in the Finance Bill, there must be some further central control, some power to ensure efficiency on the part of local authorities. I cannot help thinking, from all the speeches that have been delivered by right hon. Gentlemen opposite, and particularly by the President of the Local Government Board, that there is a disposition on the part of the heads of the big Departments not to exercise that control in the way of economy, but rather to incite the local communities to expenditure, very often on matters which, though desirable, cannot well be afforded—to use an expression adopted by the First Lord of the Admiralty, to apply ginger all round to the local authorities. From my observation—and I have had some experience of Government Departments—I cannot say that on the whole the direction of Government Departments in the matter of controlling local communities and local expenditure generally assumes the form of inciting those communities to economy. It much more frequently assumes the form of inciting local communities to large expenditure, possibly to extravagance. If I could be sure that this control would be exercised with due regard to efficiency and economy, I should say that the right hon. Gentleman was right in proposing it. I want to call the Chancellor of the Exchequer's attention to the words of his own Bill, just to show what enormous powers he proposes to give to Government Departments—setting aside the local authorities and giving Government Departments the power to say what county councils, what borough councils, and what municipalities shall have a share of these Grants and under what conditions. According to the Bill, the words are to apply even to the temporary Grants:—
"The payment of a Grant shall be subject to such conditions as may be prescribed by the Government Department concerned with the approval of the Treasury—"
The Treasury may approve of anything—
"for the purpose of securing the efficient and adequate administration of any duties imposed on the authority by Parliament, and the Grant, or any part of the Grant, may be withheld if the Government Department concerned is satisfied that any of these conditions is not fulfilled or that the service in respect of which the Grant is payable has not been efficiently and adequately administered by the authorities in any other respect."
Those are very broad words indeed—I think too broad. Since I returned to this House in 1910 I have not been able to help noticing how the House is losing control of expenditure. It votes the expenditure, but it does not afterwards control it. It is handed over more and more to Government Departments. More and more Government Departments make Regulations; more and more they are 'empowered to say to local authorities, "You must enlarge your expenditure in this or that direction, or we will not give you a share of the Grant," or "We will actually fine you perhaps £10,000." That is the kind of control that is going on at the present moment in Government Departments. If new Regulations are to be framed for the administration and allocation of these Grants, I hope that they will be placed before us in detail, and that they will be ordered to lie on the Table of the House for forty days, so that any objecting municipality which thinks it is being unfairly treated may have an opportunity of raising the matter in this House and having it properly discussed. It is paragraphs like this which give such enormous powers to Government Departments. For instance, a little while ago I heard the President of the Board of Education saying that it was in his power to order local education authorities to spend what money he thought proper on playgrounds and withhold the Grant from them if they did not spend the money as he suggested. That is a very extensive power, and it might easily be used very oppressively—I am not accusing the right hon. Gentleman of so using it—as against a particular church or some particular authority. All Regulations of this kind governing such enormous Grants ought to be laid on the Table of this House for forty days or so, in order that we might have an opportunity of raising any question connected with them, and of obtaining justice for some community which thought it was being unfairly treated by a Government Department.
I am aware that many other Members desire to speak in this Debate; therefore I will "bring my remarks to a close by saying that this Amendment will show to a very large extent who are the mere platform friends of the ratepayers, who are simply doing lip-service in the matter of these overdue debts, which have been constantly acknowledged by the right hon. Gentleman himself, and who are the real Parliamentary friends of the local authorities, who, if ever they are in office, will be willing to redress these grievances, although they may be conscious of the difficulty of raising money for the purpose of so doing. We on this side cannot but be apprehensive of our growing national expenditure, but money raised from the Income Tax payer for the relief of rates, so far as it is for the relief of rates, is not an increase of the national burden; it is raising money in a way that is fair, as many of us think, as between ratepayer and taxpayer, and is carrying out the maxim of the Royal Commission, both of the majority and of the minority, which states that the rates ought to be levied more in accordance with ability to pay.
Question proposed, "That the words proposed to be left out stand part of the Question."
I rise to second the Amendment.
Before I deal with the second Budget of the right hon. Gentleman, I should like to say a few parting words about his first Budget, "which ceased to exist yesterday. Its fate puts me in mind of the epitaph:— first Budget has had is to give a great deal of trouble to bankers and to the whole commercial community of this country. When the right hon. Gentleman spoke yesterday, as if it was so simple to credit to the next account what had been deducted in excess from the first interest payment, he was omitting to consider the fact that there are many coupons payable to bearer, and that many of these bearers are persons resident abroad. It 'will be a very complicated matter for these people to reclaim the amount which has been wrongly deducted.
Leaving the first Budget, I come now to the second. Although I may appear unkind, I must prophesy also for the Budget which has so recently seen the light of day a very short existence. There is only cue part of it which will live, that is the new Form IV. On another day of this Session I venture to think that either the right hon. Gentleman himself or the President of the Local Government Board on his behalf, will come forward and announce that it is impossible to proceed with any other of the Clauses, With reference to this second Budget, I think one thing which it has aroused throughout the country in many of the local authorities is an intense feeling of disappointment, and almost dismay, at the withdrawal of these temporary Grants which were held out to them. If the right hon. Gentleman did not intend to give these temporary Grants it would have been far better never to have dangled them before the eyes of the local authorities. Many of them have already made arrangements for the expenditure in the hope, and with the view, that these Grants would be received.
When?
The right hon. Gentleman has held out that four months additional Grants would be paid this year. Now that has to be withdrawn, and I say that is not treating the local authorities fairly.
May I ask the hon. and learned Gentleman—[HON. MEMBERS: "Order!"]—I am quite in order—if he is aware that the local authorities fix their expenditure in March or April?
The London County Council is one authority that has spent weeks in considering how these new Grants affected their financial position. The right hon. Gentleman could perfectly well give these temporary Grants to the local authorities if only he would dispense with this fantastic condition which he insists on attaching. What is that condition—in fact there are two conditions. The first is that rateable value is to be divided into the part attributable to land and the part attributable to improvements; the second condition is that the assessments for local rating must be made by the Land Valuation Department. If the right hon. Gentleman is going to dispute that that was the condition, I will remind him of what he said in his Budget speech. He said:— these Grants) means that the nation will suffer incalculable damage, because the services which are essential to its life and its progress, are being starved and crippled, and the municipalities will drift to bankruptcy."
The right hon. Gentleman would rather incur all these consequences than run the risk of giving a single halfpenny to a single landowner. I am surprised that he even gives the £515,000 this year. Is he not afraid that some landowner might get some benefit from that? In regard to this danger of the landowner getting any part of this benefit, I have never been able to understand the position of the right hon. Gentleman. Does he say that the landowner pays rates or that he does not? On some occasions he says that landowners do pay rates; on other occasions that they do not—just as it suits his particular purpose at the particular moment. Whether they do or whether they do not, in this particular case he need not really be frightened to give them relief, for if the landowner does not pay any rates, how can he be relieved of a burden to which he is not subject, and, if the landowner does pay rates—if the case is that personalty should contribute more!—why should not they have their share of the relief? I have not been able to understand the case of the right hon. Gentleman on this part of the subject at all. There is one point on which, to a certain extent, I agree with him, and that is that our present rating system does tend too much to discourage improvements being made. If I may, personally and tentatively, throw out a suggestion in regard to this, the proper way of dealing with that subject is, in regard to any future improvements made, that for a certain time the rateable value should not be increased until the person who had made the improvement had the whole benefit of it.
What does the right hon. Gentleman do by this Clause? He attaches a condition which is wholly impracticable. He says that the local authorities shall not get any relief until Parliament has provided for doing something which is as impossible to do as to square the circle. He has provided that Parliament is to divide the rateable value into that part attributable to land, and that part attributable to improvements. Rateable value has a perfectly well-defined legal meaning. It is the annual letting value of a property in its then condition to a tenant for the year. That is what he has got to divide. He will not really achieve the result at which he is aiming. Take the case of agricultural land which has a building value near the town. It has an agricultural annual value of £1 per acre. Take its building value as being £10 an acre. The right hon. Gentleman cannot by merely dividing the £1 increase the rateable value. Under his own Bill, when it becomes an Act, he has got to find out how much of the £1 agricultural value is attributable to the unimproved site, and how much to improvement. He is raising for himself problems which it will pass the wit of man to solve.
Take the case of my own borough, St. Pancras. Nearly one-third of the rates there are paid either by a railway company, the tramways, water pipes, or other public undertakings. How is he going to deal with the division there? For instance, how is he going to divide the rateable value in the case of a water main on a tube railway? How is he going to divide that part attributable to land, and that part attributable to improvements? Representing a borough which gets so large a portion of its rates from property of this kind, I want to know, before I make a condition to any Grant, what it really means, and how it is to be carried out. I cannot help feeling that the Government themselves, when they come to draft the Bill, found that what they had set out to do was impossible, and that is the reason why the Revenue Bill does not square with the Finance Bill. It is as if the Finance Bill had said, "We will make certain Grants to local authorities on condition that Parliament makes provision for 'squaring the circle,'" and when the Government found they could not square the circle, they had put into the Revenue Bill that the Inland Revenue Department was to collect information with a view to squaring the circle. The curious part is that they have to collect that information with a view to dividing the rateable value—with a view to squaring the circle!—and then are to use-it for an entirely different purpose, namely, the purpose of adjusting the full site value.
It is a month since the Revenue Bill was ordered to be brought in. I suppose there is hardly a case in which a Bill has been delayed so long after it has been ordered by the House to be printed. During all that time the great intellects opposite have been at work, trying to frame a Clause which would provide for dividing the rateable value so as to distinguish between land and improvements. But after all, this Clause 1 is rather a ridiculous mouse which has emerged from the parturition of these mountains of intellect! I shall have to submit to you later, Mr. Speaker, that the mouse is not only ridiculous but disorderly, because there appears to be no justification whatever for putting that Clause for collecting information, with a view to rating, into a Bill which is founded on a Resolution—and only a Resolution to amend the law relating to Inland Revenue, Customs and Excise—and which is not required for the purpose of any Inland Revenue Duty at all. As I say, the only thing that remains in this Revenue Bill is this new Form IV. It is far more onerous than the old Form IV. Not only the owner, but the occupier can be called upon to give information which is extremely difficult to give. If he wants to protect himself he will require to get expert advice. Severe penalties are imposed upon him if he does not do what is required. He is to be fined £50 if he does not show, say, what is the unexhausted value of the improvements in the case of agricultural land during the last fifty years. In the case of other land there is no limit of time, it may go back to the Romans. There is another condition: that this relief is only to go to that part of the rating which is attributable to improvements. I cannot understand how you are going to ascertain that. Suppose you pay some money to a local authority, and in consequence of receiving that sum of money the local authority decides to spend more; where does the relief to the ratepayer come in?
Take the London County Council: there are many branches of expenditure in which that council would like to indulge if it could afford it. It would like to increase the salaries of the teachers. Suppose when it gets more money it spends more, where does the relief to the ratepayer come in? So far as giving the relief in respect of improvements is concerned, in many cases the result of that will be very unfair. For instance, if you take a large emporium like Selfridge's, and compare it with shops and premises of a humbler kind, Selfridge's will get a much larger percentage and will pay much less in rates than the smaller shops. This is a gradua- tion of rates in inverse proportion to ability to pay. I do not say it works out in all cases like that, but in many cases it will. Before the Grants to the local authorities are made conditional upon these things, we ought to know much more fully how we stand. As to the point about other conditions in regard to local authorities to which my right hon. Friend referred, I agree with him that if Parliament gives money to local authorities Parliament is right, and it is the duty of Parliament to supervise the control of the expenditure, that is to say, it is entitled to see in the first place that the money is applied to the purposes for which it is granted, and also that the services for which it is actually granted are efficiently carried out. But what the right hon. Gentleman has done goes much further.
The right hon. Gentleman's scheme from beginning to end is based upon mistrust of the local authorities in Great Britain, and absolute confidence in the local authority in Ireland. I must apologise to hon. Members from Ireland for calling their Parliament that is to be a local authority, but it is so called in the margin of the Bill, and it is the only way it can be called to bring it in Order. The right hon. Gentleman's principles are absolute mistrust of local authorities in Great Britain, and absolute confidence, as I said, in the local authority in Ireland. So far as the local authority in Ireland is concerned, he does not even define the purpose for which the money is to be applied. It might be applied to the payment of Irish Members or for giving additional abatement or relief, or to any other purpose. But so far as the British authorities are concerned, if I may use the right hon. Gentleman's own words, mandamus is too rusty a weapon, so he is forging for himself a bright new sword with which to bring the local authorities to the knee. He deprives them of every vestige of independent revenue, except rates. He has stripped them of all. Even so far as local taxation licences are concerned, he leaves to them still the duty of collection, although he does not pay the full cost. So far as the Carriage Duty is concerned, he pays nothing for collecting it, although they have to hand it over, and he takes away the half share of the Land Taxes, which he promised when the Budget was under consideration, and he gives nothing, so far as the Petrol Duties or the Licence Duties on motor omnibuses or taxicabs plying within the area of the local authorities, an independent revenue to which I think they have a fair claim; and having deprived them of every shred of independent revenue except rates, he deprives them of the right of assessing the value and sets up a separate authority. And thirdly, there is that Clause in the Bill to which my right hon. Friend referred, which enables him not only to say, "you are not discharging efficiently the particular duty for which we made the Grant, but we can also withhold the Grant, because some other duty is neglected." They can reduce the Education Grant, because they say the authorities are not spending enough on some other service. Many councillors will find themselves between the Scylla on the one hand of the ratepayer and the Charybdis on the other hand of the Government Department.
I served on the London County Council for three years, and I certainly think the work done there is as arduous as the work done in this House, and I would have the right hon. Gentleman also to remember that members of local administrations are the elected representatives of the people, just as much as Members in this House are. They are elected by the same electors, except upon a larger franchise basis, because a certain number of women have the vote as well as men for local authorities, and if the electors are qualified to elect proper representatives for themselves in Parliament, so also they are qualified to elect proper representatives on those local authorities. I think the right hon. Gentleman must see that local authorities will bitterly resent his mistrust of them, and the way in which he treats them with regard to interfering with their interests and putting them more and more under the domination of a central authority. In conclusion, I say, that if the reduction of the Income Tax involves the abandonment of the temporary Grant, I would rather the right hon. Gentleman would not reduce it. I have always pressed for Grants for local authorities, and therefore I am bound to face the taxation necessary. I would ask the right hon. Gentleman not to reduce the taxation rather than abandon these Grants. But I ask him, in making these Grants, not to make them dependent upon fantastic and impossible conditions. He admits himself they are due, and he said that pledges have over and over again been given. He said that national services are being starved, that incalculable damage is incurred through these Grants not being made, and I ask the right hon. Gentleman not to allow himself to be deflected from carrying out his pledges or performing this duty by any imaginary fear of granting any possible relief to the landlords.
If it should ever occur that my right hon. Friend should be drawn into a wrong course with regard to any financial matters, we may depend upon right hon. and hon. Gentlemen opposite using their influence to guide him in that direction. Here is a case in which my right hon. Friend has, in a very conciliatory spirit, met objections very strongly urged in this House, and, on the whole, made concessions which I think will be generally received with gratitude, both in the House and in the country. What do hon. Gentlemen opposite say? They begin to lament what is done. I would like to ask them, if the Budget in all its bearings remained, what would they have to say about it this afternoon? The truth is, there is no pleasing hon. Gentlemen opposite, and any reasonable or moderate course, such as the Government are now pursuing, brings forth from them nothing but invective. I desire in a few words to thank my right hon. Friend for what he has done to meet the objections urged upon this side of the House. There was one objection put down in the name of six hon. Members to the effect that no more money should be raised than was necessary to meet expenditure of which Parliament approved. Surely that was a most reasonable objection. I cannot imagine people sitting in any part of the House not approving of that. Now the Bill has been made to meet that objection. With regard to the other part—Clause 13 and the tremendous Schedules in the Bill—my right hon. Friend has promised that these will wait for a little further consideration. I do not believe there is an hon. Member in this House who has considered this matter carefully who in his heart does not believe that the great matters involved in Clause 13, and the schedules that give effect to them, do not demand far more serious consideration than it would be possible to give to them in the hurried Session in which we are engaged. Therefore we are much obliged to my right hon. Friend both for meeting us and for the spirit in which he has met us.
I go the length of saying we, especially on this side of the House, are not always met in the same spirit when we go in an humble way to right hon. Gentlemen on the Treasury Bench. The other day I went with the right hon. Gentleman who moved this Resolution to the Prime Minister, and we were supported by no less than 366 Members of this House, and what did we get? Nothing but a mild rebuke conveyed with the usual politeness which the Prime Minister always puts forward. So we do not always fare well from my right hon. Friends. But on this occasion we have been excellently treated by the Chancellor of the Exchequer. He adopted the words, which on several occasions I have heard from yourself, Mr. Speaker, in connection with your re-election to the Chair, words which I think should always embody the attitude of Ministers towards the House. You always say, Sir, on those occasions, and I think it would be judicious if Ministers always said the same:— which the Royal Commission said they ought to be got rid of root and branch. [HON. MEMBERS: "Where are they?"] They are the boards of guardians. I thought it would not be necessary to say that. Both the Minority and Majority Reports of the Royal Commission indicated that they should be treated in a very different way from the way in which they are treated under this Bill.
To what other authorities does the right hon. Gentleman refer?
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The illustration I have given is good enough. I do not want to go into too many details. I leave that to the imagination of hon. Gentlemen. Speeches in the House of Commons ought to avoid details and stick to principles as far as possible. Then large Grants are made here to new organisations which are young and untried, as, for instance, the Grant made to the Road authorities. There is a great Grant of £1,500,000 for making these roads throughout the country. Although hon. Gentlemen opposite speak as if nothing had been done, nevertheless, great Grants have been made to the local authorities by the Chancellor of the Exchequer. The Liberal Government has done far more for the local authorities than was ever done in the same time by any previous Government. Take old age pensions, for example, and the relief they give to the Poor Law authorities. Take the Road Grant and the system of national insurance, providing sick attendance all over the country. Looked at in any fair or reasonable way, these things constitute immense Grants given by this Government to local authorities throughout the country.
It is of the highest importance that we should realise how much we are doing under this Bill. My right hon. Friend the President of the Local Government Board stated yesterday that practically the Bill involved Grants amounting to £38,000,000 to the local authorities. Of course that does not appear very clearly at the first glance, but the House should not pass a vast measure of this kind without fully realising what it means. I make out that Grants amounting to £24,000,000, including the Education Grant of £12,000,000, are given to the local authorities, and the Bill Grants £13,000,000 more, making £37,000,000. It is not as if the new £13,000,000 was given on the same principle as the old Grants. The Bill involves new Grants in substitution of the old Grants amounting to the great sum I have mentioned. I think this House will have lost all respect for wise financial control if it votes such vast Grants as these without seeing that every precaution is taken to secure that the money is properly expended. The objection I take to the control embodied in this Bill is this: The Bill shows implicit confidence with regard to Government Departments which are set up over these authorities, and I cannot entirely share that confidence. It leaves the Treasury and the Government Departments involved to fix the amount of the Grants and all other particulars with regard to the expenditure of the money. I totally disagree with that. I think more control should be given over these vast sums by Parliament, and that in some form or other they should be brought before us for some regular review.
They will be.
I am glad to hear that they will be brought forward. At the present time the expenditure is most imperfectly reviewed by this House, and if all this money is to be given in new Grants, the House should follow the expenditure of that money with unceasing care to see that it secures the object for which the money is granted.
This is the first time it has been proposed.
This Bill contains a Schedule extending over six pages of large print in which twenty-seven Acts of Parliament are altogether or at any rate largely repealed—these Acts stretch over the last thirty years and embody most important projects of social reforms—and the right hon. Gentleman who moved the Amendment ought to grant that such a vast experiment as this ought to be carefully reviewed by this House before it is made. I do not believe that this House will get any proper idea of what is being done under the Bill unless it looks into the details a little more closely than has been done so far. Take the boards of guardians. No less than 60 per cent. of the cost of all officers and six shillings a week towards the upkeep of lunatics is to be granted, as well as all payments for public vaccinations, and, in my opinion, all these are most questionable subsidies. Why should these Poor Law institutions which have been condemned, I might almost say by an increasing body of public opinion, for two generations be bolstered up with these vast subsidies? We ought to ask will these Grants tend to secure more economical administration? Personally, I think they will have a tendency to cause these bodies to be more extravagant, and will increase discontent. I think some vast reform of the Poor Law system should be carried into effect. There are no less than 682 workhouses in this country, and these might be reduced by at least two-thirds and vast sums saved to the ratepayers.
With regard to the county councils, they get a Grant of 6s. towards the lunatics. There is also granted half the expenditure upon police and half the upkeep of the main roads, amounting to £2,500,000. I think that is very doubtful expenditure, and this House ought to find some way of correlating this expenditure of the Road Board and this new expenditure, in order to see that there is no overlapping. There is always this danger where two independent authorities are spending money on the same object. Perhaps the largest expenditure is in connection with the local education authorities, and I would like to direct attention to this point: Every year we have practically been promised by the Government a new Education Bill, under which we should have an opportunity of reviewing the work of education throughout the country, and we have been disappointed up to the present time. Now this reform is taking a new shape, and it reminds me of the effect of the great Education Act of 1902. In that year we had a great wrangling about religion when the Bill was passing, but no word was spoken about the organisation of the services, or about proper relations being established between the great body that controls education, namely, the Education Department, and the new bodies that were being set up. The reason that we have had such vast extravagance, both at headquarters and in many of these local authorities, is that there is no good business organisation established which regulates the connection between the two, and which allocates duties to each, and sees that there is no clashing or overlapping. There is nothing to ensure that the work is carried out in the way that business men would carry it out.
Before sanctioning these great new Grants I want the House to consider the growth of expenditure in the Government Departments for the last eleven years. The total amount of the Education Estimates in 1902 was 10.2 millions, and it is now 14.7 millions—that is, we have added £4,000,000 to them. The Education Estimate without this new Grant has increased by 49 per cent. With regard to the rates in 1902, the total rates for education in England and Wales was 5.8 millions, and in the last year the total was 12.6 millions, so that there has been an increase in the rates amounting to 6.8 millions, or about 120 per cent. When you put the two together you find an increase of £11,000,000 during the eleven or twelve years I have mentioned in our expenditure on education. It has been suggested that the increase in the number of children is responsible for this, but may I point out that there has only been an increase of 1½ per cent. in the number of children attending elementary schools, and for this there has been an increase of 70 per cent. in the outlay, and yet hon. Members are always speaking as if the Government were making no expenditure on education, and as if all the evils complained of would be met if large fresh Grants were made. If the expenditure of public money and new Grants from the ratepayers and the taxpayers would have provided us with an excellent system in this country, we should have had it long ago.
I have put before the House the view I take about this Bill, although I do not think we have been talking so much about the Bill before us. As I understand Clause 13 of this Bill, all these vast Schedules are to be referred in another Bill, and, therefore, I would ask the right hon. Gentleman not to hurry us. These things involve such a large outlay for the taxpayers that they will do with a little further consideration, and I am convinced that if we do not secure the development of a proper business relationship between the Government Department and the local authorities, we shall never get a satisfactory administration in this country. What can be the effect of making these huge Grants on this wholesale scale hurriedly and without looking into the matter? The effect will be to induce the local authorities to plunge into expenditure on as vast a scale as we do here in the great Departments of State. I desire to thank my right hon. Friend for the fact that he has not plunged hastily into this expenditure. He has put it aside for a time in order that there may be fuller consideration. I ask him not to be hurried by hon. Members opposite, who would hasten him to destruction if they could. [HON. MEMBERS: "No!"] I ask the Government to give the fullest consideration to the necessity of securing economy before any further Grants are made.
I resent very much the allusion which the right hon. Gentleman (Mr. Lough) made with regard to the local authorities of this country. So far as my acquaintance with the county boroughs and the district councils of this country are concerned, I think Parliament and the people of this country are very much indebted for the services of the people who give them in order to carry out the duties delegated to these councils by Act of Parliament. I go so far as to say that with regard to boards of guardians, Parliament has established them, and Parliament requires that people should serve upon those boards. We have up and down the country people giving their services voluntarily to carry out the duties devolving upon them, and so long as Parliament continues to enact that these duties have to be performed, I think we ought to be grateful to the people who undertake them. I do not apologise for intervening in this discussion, because I have taken an active part with regard to local taxation for a good many years. I have advocated in Parliament and out of it for the last fifteen years that greater and more extensive Grants should be given to local authorities in regard to their expenditure upon what is admitted to be national services. I may say that up to yesterday the ratepayers of this country and the various local authorities of this country were hoping that at last, and during the present year, this policy of giving increased Grants on behalf of the expenditure on national services would be carried out. I do not think that in considering this measure we ought in any shape or form to look upon the question of local taxation from any narrow point of view, because Ministers who were Members of a Conservative Government and Members of the existing Ministry have all stated that education, main roads, police, the lunatic asylum, Poor Law relief, and many other similar services were national services, and ought to have larger contributions from the national exchequer. I was sent to this House in order to do something with regard to this question of the adjustment of local taxation. The people and the local authorities of this country were looking forward to the Chancellor of the Exchequer, owing to his Budget Speech, embodying in the Finance Bill Grants for local authorities in aid of their existing expenditure on these national services. They are entitled to that relief, independent of any other services which are going to be placed upon them, and on which there are going to be further vast sums of money expended.
The local authorities will be very much disappointed at the extraordinary position which has been arrived at with regard to this measure. I stand here as an independent Member, and I do say, looking at the position of the local authorities throughout the country, and looking at the position of this Bill and the proposals which were made with regard to it yesterday, that I shall have no hesitation whatever in supporting the Amendment moved from the opposite side of the House. I shall do so because it is an absolute fact that during the present year some relief should be given, and I for one cannot vote for any policy which does away with the Grant of that relief. The Chancellor of the Exchequer stated that the duties of local authorities throughout the country with regard to these national services were of such a character that many of them, if they had to go on without getting any relief, would soon be in bankruptcy, and he said that he was going to give them that relief under this particular Budget. That relief is not now going to be given, and I say that is wrong. The Chancellor of the Exchequer could this year have given a Grant, which would not be permanent, in aid of the existing local expenditure, and it ought to have been given without any of the conditions that now appertain to these various services. If you were to go to any educational authority and ask them why they were spending so much money on the national service of education, the reply would be that the Education Department in London required the expenditure to be made and they were bound to make it. It is so also with regard to other Departments.
Some ten or twelve years ago the right hon. Gentleman opposite brought in a Valuation Bill in order to carry out the Report of the Royal Commission on Local Taxation. I agree with the hon. Member who moved the Amendment, that there is little need in London for a Valuation Bill, because there can be no question that the valuation in London is a fair and reasonable one in all districts. I have only gained that knowledge, because I have sat on various Committees when that fact has been admitted. If you go outside London, however, there is and there has been for the last twenty years an absolute necessity for a fair and equitable valuation authority set up in each county, and I for one will support any measure which will do this and at the same time bring in those who up to the present have given their services on assessment committees, and have done fair work to bring about equitable conditions with regard to valuation; but there is a feeling at the present time that the ratepayers who have to find the money for local purposes and get at great deal of money for national services will never recognise it as a fair and reasonable thing that we should have the system of valuation which is proposed to be set up by the Government. We must allow the localities, so far as they are concerned, to carry out a proper system of valuation, and we should have a Court of Appeal in order to adjust differences where appeals are necessary. The people of this country have come to the conclusion, and I have come to the conclusion, that we do not want a centralised Department in London. We should use and we should give power and authority to our county councils. They are representative of the people as much as Members of Parliament, and we should give more power to county councils and to county boroughs, and should entrust them with duties which at present are dealt with in London and not in the locality in which the case arises. In view of all these circumstances, I am sorry that the Chancellor of the Exchequer has withdrawn the Grants even for this year and is proposing to take a penny off the Income Tax. He ought to have retained the penny on the Income Tax, and he should have given the Grants. The ratepayers were expecting those Grants, and I for one am disappointed that they are not to be given.
I am sure that the House has listened with great interest to the manly speech which has been made by the hon. Gentleman who has just sat down. Those who have been for many long years associated with local government will agree with him that the question of the onerous burden of the rates on the localities is one which should have been dealt with long ago by the State, and that relief ought not any longer to be with- held from the local authority with regard to these particular items of expenditure. To load his proposals, as the Chancellor of the Exchequer has done, with extreme and absurd conditions is to postpone, as my hon. Friend the Member for St. Pancras (Mr. Cassel) very truly said, the fructification of those proposals for an indefinite time. Anyone who has had to consider these valuations must be fully aware that the replacement of the present system by the system which the right hon. Gentleman proposes cannot be done in anything like the time he suggests, and that many years must necessarily be involved in doing it. The President of the Local Government Board yesterday practically confined the whole of his speech to the question of the Grants to the local authorities, and his speech on that subject was a very interesting one, but I should have been very glad if he had tried to justify some of the measures for raising the money required to meet the expenditure. He did not say a single word on the subject of taxation. He did not say a single word on the increase on the Income Tax, which, while it may be necessary, is unfortunate, because it appears to be mortgaging our strength to meet any future emergency with which the country may be faced.
The worst feature of the Budget, however, is the enormous increase in the Death Duties. There can be no question that we are spending far too much of our capital. When the Death Duties were first imposed, Sir William Harcourt, after most careful investigation, declared that he did not think it wise or prudent to go beyond 10 per cent., because, if you went beyond that, you were spending money which was required for the development of the country, and it was infinitely better that it should fructify in the pockets of the taxpayers than that it should be spent by the Government. The pressure of the Death Duties is becoming so terribly burdensome that I think they are to be regretted, and I, personally, voted against the Resolution upon which the proposals are founded. I am quite ready to meet the increased charge in the Income Tax. I am sorry that it should be necessary, though I suppose it is. I am not at all surprised that the hon. Member for the Hexham Division (Mr. Holt), who did not think it necessary to move his Amendment yesterday, cried dismally, in a recent speech which he made in the country, that no man had done more to bring on Tariff Reform than the Chancellor of the Exchequer himself. The income must be found from some source or other, but it is certainly not being found from the right source so far as the Death Duties are concerned. There may be differences of opinion as to the merits of a Tariff Reform scheme and the taxation of imported manufactured goods, but there is nobody who has made that more inevitable than the Chancellor of the Exchequer, and, if the country is foolish enough to return him to his present position at the next election, I would not be in the least surprised to see him proposing the thing himself. He is quite equal to the task, and he is just as likely to propose a Tariff Reform scheme in a few years' time as he is at present to denounce it.
One effect, and a very serious effect, of the increase in the Death Duties in the 1909–10 Budget was the withdrawal from this country of very large amounts of foreign money invested in British securities. I do not suppose there is anyone with any knowledge of banking who has not had this brought prominently under his notice. It was an extremely common thing for foreigners to invest money in British securities, leave them deposited in British banks, and draw the annual income from them after the deduction of the Income Tax; but when it was discovered that those securities could not be transferred on death without paying heavy Death Duties, imposed on them by the Budget of 1909–10, very large orders were sent to sell out those securities at any price, and to remit the money back to the country to which the investor belonged. I was told not long ago of one case of £500,000, belonging to a Spanish gentleman, which had been in the hands of a London bank for many years, and every penny of which was invested in British securities. Inquiry was made as to the effect of those proposals, and, the answer having been given that a very large percentage, 15 per cent., would be charged on transfer at death, orders were sent to sell out the whole of the securities and to remit the money to Spain. That has been done in many cases. It began or, at all events, it added very seriously to the great depression in British securities which we all deplore to-day, and it has also withdrawn from investment in British securities year after year the money which formerly used to come from abroad for that purpose. That is one of the serious results of the increase of the Death Duties in the 1909–10 Budget. It is not only a prodigal policy in one respect, but it is a very disastrous one in another.
I now come to the question of the local Grants, and there are important provisions in the Bill referring to (Scotland. These Grants are to be made contingent there, as they are here, on the adoption by Parliament of the scheme of rating land and improvements separately. The other day the hon. Member for Kincardineshire put a question to the Chancellor of the Exchequer as to what was to become of the present system of valuation in Scotland, and what was to be done with the assessors and surveyors who now carry on that system. The answer was, I think, that the two systems were to go on together, and, in some kind of way, the Scottish system would be absorbed into the new system of a central valuation. I asked a supplementary question whether or not that system was to be continued at the expense of local authorities, and the only answer I got was that I did not understand the subject, to which I made a rejoinder to the effect that it was the right hon. Gentleman and not myself who did not understand the subject. I should like to know now from the Secretary for Scotland, who, I believe, is going to follow in this Debate, and who probably knows a great deal about these things, whether we are to lose the Scottish system of valuation, a system on which we have prided ourselves in Scotland since 1854, and which has often been quoted in this House by the Chancellor of the Exchequer as an ideal system which works extremely well in this respect, that it is carried out by Government assessors with competent local committees, and Valuation Courts for the burghs and counties, with whom appeals rest from the judgment of the assessors. The system is an admirable one; it has served the people well; it has never been complained of, and, so far as I know, no proposals have ever been made to change it, and I should like to know whether that system is to be scrapped for the purpose of an official rating. I know it cannot be scrapped for the purposes of annual valuation for Income Tax, and that is one of the absurdities of the position of the right hon. Gentleman.
The Chancellor of the Exchequer proposes to collect Income Tax on the rental of hereditaments, and, therefore, there must be an annual rental. If he proposes to assess in future the capital value that involves one valuation for rating purposes, it does not and cannot supersede the necessity for an annual valuation for the purposes of Income Tax. I went on to ask the right hon. Gentleman whether he intended, for his own purposes, or rather for Treasury purposes, to continue that system in order to collect Income Tax, and the only answer was that I did not understand the question. Obviously, the right hon. Gentleman himself did not understand it, but perhaps the Secretary for Scotland, who, no doubt, does thoroughly understand it, will be kind enough to give me the information. If the proposal is to rate in this way, they will find it extremely difficult to carry out. It is, I know, intended merely as a sop to the Land Values Group. I do not want to be at all offensive, but I had my attention called to a book the other day by Professor Matheson, in which he talked about the kind of reverence which was paid at present to earnest and gifted lunacy. Perhaps the right hon. Gentleman will excuse the final word in that quotation, but I really felt that this was a reverence paid to earnest and gifted lunacy, for I myself can conceive nothing more impossible than the separation of site and improvement value for the purposes of rating. We have discussed it in this House over and over again. Personally, so far as I am concerned, I should profit immensely by the change. I am interested in buildings which are very valuable, but they stand on what might almost be described as a postage-stamp piece of land, and if my rate is based on the land value I shall be called upon to pay much less than I am able to pay, and it will be at the expense of other people.
We were told in this House by the right hon. Gentleman the President of the Local Government Board, who had a very unpleasant position to occupy last night, a position in which he had my sincere sympathy—we were told by him that our present system of rating was ridiculous and absurd, because the moment a man added a bathroom to his house and the moment he built a large house instead of a small one, he was pounced upon by the assessor. The right hon. Gentleman had said previously it was quite impossible to have such a thing as a local Income Tax. I agree. I think it is impossible, and if you are going to share the profits of the Income Tax with the local authorities, the tax must still be collected by the Imperial authorities and paid into a central fund from which a share can be transferred to the local authorities. What other possibility than the present system is there of getting a rough-and-ready idea of a man's income than from the manner in which he lives?
Does that apply to shops as well?
I think it does to a certain extent. Wherever you find a site value developed in that way, you get a rough-and-ready idea of the ability of a man to pay and you rate him accordingly. There is no other way in which you can get at him, if you cannot get at him by a local Income Tax, which I do not think you can do, and you will be inflicting an intolerable hardship on people if you attempt to separate improvements from site value. The hon. Member for St. Pancras, who has left the House, called attention to the fact that the Chancellor of the Exchequer is doing everything he can to prevent the site-owner getting any share of this relief. There is one thing, at all events, which will tax the right hon. Gentleman's ingenuity, and that is to prevent the site-owner in Scotland getting relief, because the site-owner in Scotland is generally the man who owns the improvements, and it does not matter to him whether he gets relief on the site or on the improvement—he will get it! The Scottish feuar is always left out of the right hon. Gentleman's calculations in these matters, but he cannot avoid, in Scotland, giving some portion of this relief to the hated owner, who owns the site value as well as the improvements. Then again in Scotland the system of rating is quite different from that which obtains in England. In Scottish burghs the occupier pays two-thirds of the rates only, and in the counties he pays two-fifths and the landlord three-fifths. It may be held, and I have no doubt with some truth, that the rates on the landlord are payments out of rent, and that he therefore bears the burden of those rates. But when you come to the occupier, his case is quite different. He has to pay his rates out of personalty. The occupier's rates are, and must be, largely drawn from the person who gets no rent from the property which he is occupying, and he has to pay rates from the same source as he pays his rent—from his own money or investments. Therefore to that extent the actual cost, as far as that portion of the rates is concerned, is paid by him if he cannot get it back, either by a reduction of rent or in some other fashion. The position is quite different from that which obtains in England, where the whole of the rates are paid by the occupier and where the landlord has no hand at all in the matter.
There is one other point, and it is a very important point, upon which I wish to put a question. I do not know whether the right hon. Gentleman can tell me about it. If you are going to divide the rating, as is suggested, in what way do you intend to apportion the charge? The rates are to be put on one subject, or on the other. How are they to be apportioned? That is a thing we ought to know. It may not be easy for the right hon. Gentleman the Secretary for Scotland, or for the Chancellor of the Exchequer, to answer, but certainly the House ought not to be asked to legislate in the dark in this matter. Then, also, with regard to the Scottish Grants, I notice a peculiar omission. There is apparently no intention to repeal the Act of 1898. Surely that must be an omission from the Schedule, otherwise I cannot make out what is going to happen about those Grants. There are special Grants going to the Highlands of Scotland. There is also a Land Tax Grant under the Act of 1898. These appear to me to disappear. Perhaps the right hon. Gentleman can tell me what is the position in regard to them. Again, I notice he has apparently forgotten entirely the Mental Deficiency Act of last year, in which he put one-half of the cost of the maintenance of pauper lunatics on district and borough councils, transferring that obligation from the parish councils. He does not give these district and borough councils any Grant at all, although he gives the parish councils a Grant for half of their share of the maintenance. Another very important matter is that, so far as I have been able to make out, there is still unallocated a sum of £400,000 in the Scottish part, and it is proposed to be allocated by a Minute of the Scottish Office, with the consent of the Treasury. I entirely object to a large sum like that being left unallocated. I go further. I say if you are going to have a postponement of the payment of these Grants we ought to get some further report on the subject. The Departmental Committee which sat on the general question took no notice whatever of the Scottish case. It received no evidence on that case, but it did receive a certain number of memoranda, although not a word about Scotland appears in their report.
I do not know that I am altogether pleased with the allocation of the Scottish money on so nearly similar lines as those proposed for England, because the circumstances are not similar. The cases are very different, and need very different treatment altogether. I think it would be very desirable if there is to be any considerable delay that some other Committee should report carefully upon this matter. I do object to the large sum of £400,000 being left unallocated, and I think the Chancellor of the Exchequer will agree that we ought, if possible, to come to some arrangement by which that money should be allocated in a satisfactory manner. Of course the whole of these Grants depend very much on the conditions which are laid down for the expenditure of the money. I look with great doubt upon the enormously increased power which the Central Department has taken to itself in connection with these Grants. I do not like the increased interference at all. I do not like the power they are giving themselves to drive the local authorities into greater expense. I do not believe these Grants are going to be nearly so remedial as they are said to be. I am afraid that, in order to earn a very large portion of this new money, the ratepayers will require to incur a very large amount of expenditure. I am quite sure of that by reason of our experience of the Road Board in Scotland. That Board gives us £5,000 on condition that we spend another £5,000, and it is very much the same thing here. The right hon. Gentleman says, "I am giving you so much for nursing, but I will not pay it unless you double the money you spend on nursing, and see that the nursing is efficient." If people think that they are going to get ninepence relief out of the rates, I am certain they will get nothing of the sort. The right hon. Gentleman, in making his speech yesterday, took great credit to himself for the fact that one-third of the whole of the local rates would in future be found by Government subventions. Yes, but I want to ask him whether that was not one-third of the present expenditure, and whether he took into account the larger burden to be placed on the ratepayers in order that they should secure this particular subvention. I venture to predict that if the experience in the future is anything like the experience in the past, the benefit to the local ratepayer will not be nearly so great as it has been represented to be. Indeed, yesterday I had a letter from an exceedingly competent county council clerk in Scotland—he is clerk of a very large county with an enormous rental and a very large area—who has been going very carefully into this Schedule and these proposals, and he has come to the conclusion that, excluding education, the relief to his rates would not be more than 3d. in the £, and he added:— can answer my questions as to our valuation system and the other matters to which I have referred.
I sympathise deeply with the hon. Baronet (Sir G. Younger) because of the suppressed indignation from which he suffered. I am glad to think that the incident occurred twelve years ago. I can quite appreciate how angry he must have felt, knowing that he had a just grievance, that his pointed powers of expression were not available. For my part, as an old member of a local authority, I should be very sorry to see anything which promised to interfere with the autonomy of local authorities. On the other hand, as the right hon. Gentleman the Member for Fulham (Mr. Hayes Fisher) and the hon. Member for West St. Pancras (Mr. Cassel) frankly confessed, it is impossible to conceive that any Government should give Grants amounting to £11,000,000, which are in many cases one-half the total expenditure for certain services, without having the power to see that those services are efficiently and, above all, economically conducted, because the money of the ratepayers equally with that of the Government is involved. I think it will be most convenient if I answer the specially Scottish questions put to me by the hon. Baronet the Member for the Ayr Burghs (Sir George Younger) before I deal with the general Debate on the Second Reading of the Bill. He asked me a question about the Mental Deficiency Grant, and he fell into a slight error in regard to it. It is intended to pay one-half of the expenditure, not only of the burgh councils, but of the district boards of control. I think everybody who has approached me on that subject and all the deputations I have received have fallen into exactly the same error, so that it is one for which I do not blame the hon. Baronet. As a matter of fact, the Grant is given to the burgh council and the district board of control under the equalisation scheme in the Mental Deficiency Act. They pay one-half of the balance, so they receive one-half of the Grant. I think it is fairly apportioned, and I believe that is the intention and the effect of the Schedule. With regard to the Burgh Land Act and the other Acts, they are dealt with, as the hon. Baronet supposed, out of the £1,250,000.
The hon. Baronet made one remark which was also made by other speakers. He seemed to think there was considerable delay, that the whole proposals of the Government had been torn up, and that the local authorities had nothing to which to look forward. I do not know why the hon. Baronet thought there was to be considerable delay. We propose, if the House of Commons will allow us, to proceed with this Bill, to determine the Grants to local authorities, and to provide the money for them next year. The only change that has been made in this Bill is a much smaller change than hon. Members seem to think. They greatly exaggerate the objection, in which we felt there was some force, made from various parts of the House, including a number of our hon. Friends behind us, namely, that we ought not, until we had arranged for the allocation of the money, to raise the taxation. We have met that criticism. The only difference, so far as local authorities are concerned, is that they do not receive the four months' Grant, which they would have received this year. As for the general scheme of the Chancellor of the Exchequer, and the very generous Grants, as everybody in his heart must acknowledge them to be, the Government has made no proposal to recede from them. They intend to carry these Grants, and all the lamentations are a good deal exaggerated. The right hon. Gentleman the Member for the Strand Division (Mr. Long) seemed to think that the whole financial fabric of the Government was destroyed. But, after all, it is a very small modification. I could point him to cases, one of which he mentioned himself in his speech—the case of Mr. Goschen's famous Budget of 1888—in which a change was made.
In Committee.
It was a change very similar to this change.
No.
It was similar to this change in this respect, that the local authorities were the people who lost the money. The right hon. Gentleman will remember that in the middle of the progress of that Finance Bill, Mr. Goschen abandoned the Wheel and Van Tax and the tax on horses. There is a still later case, in the Budget of 1902–3, when the proposed tax on cheques was abandoned and nothing was put in its place. The House ought clearly to understand what apparently it has not yet fully understood, that the only change that is made in the proposals of the Government does not affect the ultimate Grants but only affects the somewhat controversial position of the Grants for the four months of this year. The hon. Member for West St. Pancras supported to some extent the proposals of the Government and thought it was very right and desirable that these Grants should be made, and, like the right hon. Gentleman the Member for Fulham, I think he found no fault with their being made from the Income Tax or from the Death Duties, therein being unlike the hon. Member for the Ayr Burghs. The hon. Member for West St. Pancras must rather regret the acerbity with which he has attacked this Bill and the efforts he has made to destroy it on technical points. He is not even correct in the statement he made about local authorities. He said they would get nothing this year. On the contrary, they get the moderate but subtantial sum of over £500,000 in England and £70,000 in Scotland for education. I can assure him that that £70,000 will be very useful and acceptable in Scotland.
The right hon. Gentleman the Member for Fulham said that when we were raising money from the Income Tax, and particularly from the Death Duties, we ought to pay off Debt with greater rapidity. Surely the right hon. Gentleman is well aware that no Government has ever paid off Debt with anything equalling the rapidity with which this Government has done so. There was one statement in the right hon. Gentleman's speech which appeared to me entirely mysterious. He stated that the Government taxed 2,200 articles that came into the Port of London. I cannot imagine what the right hon. Gentleman meant by that. He attacked my right hon. Friend the Chancellor of the Exchequer and said that Ipswich and Grimsby would not get a penny. Why not? Will they not get their share of the £11,000,000 next year? I do not know any reason why they should not. I cannot help feeling that what was at the back of all the criticisms on the other side was that they objected to the valuation and they objected to any proposal that might lead to any kind of special taxation on land. Those are really the two points raised in this Amendment. I remember it is ten years ago when the right hon. Gentleman opposite (Mr. Long) was President of the Local Government Board, and when I was one of his admiring and grateful supporters, he brought in a Valuation Bill, and though I could not at this lapse of time remember all the provisions of that Bill and am much too Scotch to commit myself to every one of its details, still I say, with great sincerity and heartiness, that that Bill would have been an enormous improvement on the existing state of affairs. What was the justification for that Bill? Was it that all was perfect and that the right hon. Gentleman wanted to make it less perfect? Of course the right hon. Gentleman never was a legislator in that spirit. He was always a legislator of a practical turn of mind, as I can say from having had dealings with him at the Local Government Board. He brought in that Bill because he knew that the valuation system was most imperfect. That was the only justification for his action. Yet yesterday he said it was a most admirable system, with local knowledge and local control.
I retained both of them under my system most carefully.
6.0 P.M.
What justification has the right hon. Gentleman for saying that we are abolishing them? What is the position? I admit to the hon. Member for Ayr Burghs that in Scotland we have had a better system of valuation than has obtained in England. I admit that frankly, and I hope we shall not lose any of the good features of that system. No proposal has been made to that effect. Why is it better than that in England? Because you have appointed people to do the work who know the business. You did not have an amateur body, as in England, to deal with valuation. You had skilled assessors, many of them revenue officials, others of them able men who do the work in the big towns. I am sure I am representing the Chancellor of the Exchequer when I say we have no intention of doing any injustice to these admirable officials. I believe my right hon. Friend contemplates using their services in connection with valuation.
Are they to be absorbed into the central staff?
I do not know. I am going to tell the hon. Baronet frankly the plan as far as it has gone. Of course we have set up a valuation system, and a great part of the land of this country has been valued under that system, and it has been valued with the object of ascertaining the value of the land apart from build- ings and improvements. A great mass of information has been accumulated, and when we come to deal with this matter from the point of view of rating it is surely reasonable that we should use that information and that machinery! It has been spoken of as if it were something mysterious. The Government has never concealed its intentions in the matter. It does not follow that we are going to abolish all the local machinery. I have said something about Scotland. I know perhaps as much about valuation in England as in Scotland. Let me say what my experience is. I remember that twenty years ago, under the existing system, you had a valuation in London in which the inequalities and anomalies were a crying scandal. You had a system under which more than half the rates—of course, I am leaving out taxation—were centrally collected—the rates of the county council, the school board, and the Metropolitan Asylums Board—and yet you had some districts—mostly the poorer districts—valued up to the hilt, and the richer districts greatly undervalued. I cannot commit myself to exact figures, but I know there was one rich district in London which was undervalued to the extent of £500,000, and another to the extent of £300,000. That has been improved, because the county council came in and without much legal power—only the power of appealing as a ratepayer in the parish—gradually got the assessment committees to admit the presence of its skilled representatives and valuers, who helped and guided it to uniformity. So you have a much better system in London.
What is the system in the country districts of England? I am bound to say this. I have a house in London, and it is valued up to the hilt. I have a house in the country, which is valued at about half its value, and a house quite close to me is valued, to my knowledge, at a third of the value that is being paid for it on lease. £250 is being paid for it on lease, and the valuation on which rates are assessed is £80. Everyone knows—no one better than some hon. Members opposite—that the valuation in the country parts of England is in many cases out of date, and in many cases a pure farce as an attempt to arrive at the true value. Is anyone going to deny that? No one. If the Government is going to give Grants on the basis of the improvement part of the value, if it is going to give Grants under its educational system on the basis of necessity and rateable value, to do justice between one part of the country and another, and between one ratepayer and another, it is bound to have a uniform and fair valuation. One of the things we have all been looking for, one of the things which we most admire the right hon. Gentleman opposite for attempting to bring about, is uniformity of valuation. No one who has not had to deal with this matter knows how important it is to secure elementary justice as between one locality and the other, and what is the vital thing in the end between one ratepayer and another. Our proposal is not to sweep away all the local machinery, but our idea is that we ought to arrive at these values through the central machinery. The right hon. Gentleman (Mr. Hayes Fisher) talked about sending young men to a place who knew nothing about the locality. What has that to do with the facts? What connection has it with the facts? Who are the young men?
made an observation which was not heard in the Reporters' Gallery.
I recollect a great many valuations of the local authorities which were upset in the Law Courts. That is not a very remarkable fact. Who are these men? They are the men who, working in districts all over England and Scotland, have been making valuations for Government purposes. You have the two systems, the system in England, and the system in Scotland—the expert system and the amateur system. No one denies that you have got a better, fairer and more uniform result from the expert system.
Annual value.
What is the difficulty in getting the annual value?
Now you are dealing with capital value—a very different matter.
Can you not calculate one from the other?
That is exploded long ago.
I know what the point of the hon. Baronet is, and I quite admit that you have to be very careful in taking any rule of thumb system of calculating one from the other, but what is to hinder us? I do not see any difficulty in dealing with the Land Tax in its capital value. In fact, a great many people think that is the best basis on which to deal with it. The right hon. Gentleman (Mr. Long) yesterday asked us a number of questions. He asked what was to be done about the taxes already collected. I should like to point out, first of all, that this is not an exceptional difficulty created by exceptional action on the part of the Government. Unless you are to lay down the proposition that the taxes introduced by the Chancellor of the Exchequer must, to save inconvenience, be carried by the House of Commons, you are always liable to have this difficulty about Income Tax whenever the House of Commons disagrees with the Chancellor of the Exchequer and reduces the Income Tax. Supposing hon. Members opposite said the Income Tax was raised too high and carried a reduction, you would have had precisely this difficulty. The difficulty is much less than would appear. The Chancellor of the Exchequer pointed out yesterday that the amount of the penny over-calculated was only about £50,000. I admit that the hon. and learned Gentleman (Mr. Cassel) pointed out a difficulty in the matter of book-keeping, but take the great body of taxation of profits of business and trade, that will not be interfered with at all, that is not affected. There will be no trouble about that. The tax will be collected when the time comes at the rate fixed by Parliament. Take the case of mortgages. There will be no difficulty with regard to mortgages, and in regard to tax collected at the source, there will be very little difficulty in the banks making adjustments for the next half-year. That is a difficulty which you will have to meet every time the House of Commons alters the Income Tax. It is not an exceptional difficulty. The second point raised by the right hon. Gentleman was the question of the assessment committees, with which I have already dealt. The third point was the Agricultural Rates Grant. That Grant is paid this year. There is no difficulty for this year. As to next year, if the Bill is passed through Parliament this Session, the money will be provided to make up for the whole of the deficiency.
Perhaps I might revert to another subject and say a word to the hon. Baronet on a point which I am sure he will appreciate. One of the reasons why it is necessary in the Scottish allocation to have a considerable elastic balance was that we have to deal with the gap created by the taking away next year of the Agricultural Rates Grant, and therefore we had to take care that we did not distribute the money to the towns and the counties in such a way as not to leave us enough money to deal with exceptional cases, because there are bound to be exceptional cases where the taking away of the Agricultural Rates Grant will hit a locality hard, and it is not the intention of the Government that any locality should suffer loss from a change in the Grants. The fourth point is the case of Ireland. Ireland is being treated just the same as England.
No!
I think it is. For medical service and the other matters which the Chancellor of the Exchequer mentioned yesterday, in reply to the hon. and learned Gentleman, Ireland will receive her share of the Grant. Next year, when these Grants come up, Ireland will receive what is proposed in the Finance Bill. There was another point which was raised by an interruption yesterday. My hon. Friend (Mr. Edmund Harvey) raised the question of using this money for abolishing the Sugar Duty. There are two answers to that. In the first place, this money would not be enough to abolish the Sugar Duty this year, and it is unthinkable that we should pass an Act of Parliament to abolish the Sugar Duty a few months or a few weeks ahead. You may be pretty sure that in the interval there will be mighty little Sugar Duty to be collected. That is not a practicable proposal. On the other hand, all we are doing here is to postpone the increase of taxation, and if you abolish the Sugar Duty for this year you would have no money to provide for the deficiency next year unless you diminished the Grants to local authorities by £3,500,000. You cannot take away a permanent tax and replace it by money which is only in your pocket for one year. That is really the answer to my hon. Friend.
As regards the comparison of taxation, raised directly and indirectly, a great change has been going on steadily during the last few years. In 1905–6 the amount of indirect taxation and of direct taxation was about equally divided. Direct taxation was very fractionally larger than indirect taxation, but when you come to 1913–14 direct taxation has risen to 57.5 against 42.5 of indirect taxation. I think that has been brought about by the policy of reducing indirect taxation. This year the figures are a little more striking, for the percentage of direct taxation is over sixty, and the percentage of indirect taxation is under forty. I have tried to deal with the points raised in this Debate, and, to sum up, I want to point out that there has been a great exaggeration of the change which has been made. It was impossible this year to give Grants on the basis on which we intended in future to give them. It is not a very satisfactory thing, after all, to give Grants to local authorities on one basis, and have to give them on another basis later on. We knew that the local authorities were very anxious for assistance, and we thought no great harm would be done by giving them Grants for four months. However, there was a difference of opinion. We do not hold the opinion that we are bound to adhere to every decision we come to, and every proposal we make. No Government that is sensible has ever taken that view. I have mentioned two cases in which Governments representing the points of view of hon. Members opposite made much more considerable changes in their Budget than we are doing. May I point out that this is neither a change of principle nor a change of policy? I, for my part, am very well pleased in listening to this Debate, to find men so representative of governing authorities as the hon. Member for West St. Pancras (Mr. Cassel) and the hon. Member for Fulham (Mr. Hayes Fisher) coming forward and really approving the principle of the Budget, saying that they like the Grants, and finding very little fault with the manner in which the money is to be raised.
I am sure that the House has listened to the right hon. Gentleman with very great sympathy in the very difficult task which he has just been doing his best to fulfil. We shall all feel that he did try, so far as the materials available would allow, to answer the questions put to him in Debate, and particularly the questions put by my right hon. Friend the Member for the Strand Division (Mr. Long), but there was one explanation which we did particularly hope for, and the right hon. Gentleman entered upon that with great alacrity. He told us that he was going to explain how the Government were going to make provision for, and how they propose eventually to carry out, the new arrange- ments of rating. We thought he was going to throw some light upon it, but all he told us was that it was very necessary that there should be a change in the rating system, and that uniformity was desired. He got no further than these two statements. So far as they go, he knows very well that they are mere truisms. Everybody desires to see the rating system reformed in the direction he mentioned. Everybody knows that there are considerable inequalities in the assessments, particularly in some of the rural districts. Everybody desires to find some sound and sensible system by which these inequalities can be remedied and adjusted. Everybody knows that equality is desirable, but what I was waiting to hear was how we are going to get equality based upon full site value. The Government set out to introduce equality into our rating system, and they proceeded to introduce at the same time a Bill basing some hitherto unexplained new system for procuring equality on full site value as ascertained by the Valuation Department. Really, if there is one thing acknowledged by people who have studied the subject, it is that the valuations, so far as they have at present gone, do not possess equality in any shape or form. They have no finality or equality.
I take the question of equality first. This full site value which is to produce equality is to be found when every valuer has made a certain assessment of what he considers to be the value of property. Certain deductions have to be made, and these may or may not have been claimed in particular cases, and where the deductions have been claimed you have one value, and where they have not been claimed you have another value. Therefore, you have from the outset valuations on a basis of inequality. As to finality, we are told that this new valuation which is being introduced under the Revenue Bill—which is really part of the Finance Bill we are now discussing—we are told that the Department which is to make this new valuation is the same Department as is carrying out the valuation under the Finance Act. That valuation is expected to be completed in time to enable Grants founded upon it to be made next year. At this moment when we are discussing this proposal, the House of Lords have been considering a question on the valuation made more than four years ago. They are now discussing and deciding a question as to whether builders' profits are site value or not. Here you have a proposal of an infinitely more complicated and difficult character. Your valuation of four years ago is not yet completed. Yesterday the Chancellor of the Exchequer was asked for about the twentieth time whether he would say how many valuations had been completed. The right hon. Gentleman always gives the same answer. He tells us how many have been served. My information is—and I challenge the right hon. Gentleman to deny it if he can—that there is in the possession of the Valuation Department at headquarters a Return made either weekly or monthly, showing the number completed, roughly speaking. Will he tell me whether that is so or not? I appeal to the House that this is not a question of opinion or doubt. The Valuation Department must know how many valuations they have got completed. It is purely a plain, simple question of fact, and when we ask how many valuations have been completed, the Chancellor of the Exchequer says he cannot tell all the different stages at which the valuations are. We do not ask the different stages. We ask the Chancellor of the Exchequer how many are completed, and he rides off and says it would be troublesome and difficult for the Valuation Department to give the information. I suggested 3resterday that another reason why the information is not given is that it would be inconvenient for himself and the valuations he has advocated to tell us how many of these valuations have been really completed. Then, and not being able to tell us four years after this valuation has been imposed how many valuations have been completed, he comes down to the House and proposes to impose a fresh valuation upon us, and to substitute the Department responsible for this muddle for the Assessment Committee.
May I say in passing, as to the suggestion that the taxpayer and the ratepayer are going to gain an advantage by the substitution for local control of centralised control as it would be exercised by the right hon. Gentleman, that I think the condition in which we find ourselves today is a pretty good commentary. Why, the clerk of a parish council producing his annual accounts would be ashamed of such a muddle as the finance of this country has got into, and it is the Chancellor of the Exchequer who has placed this House in the humiliating position in which we find ourselves to-day. He cannot control his own finance at the Treasury, and he cannot introduce an Estimate for the Budget by which he can stand for more than a few days consecutively. The right hon. Gentleman seems to contemplate that this is going to be an ordinary kind of thing. He says that this will happen whatever Chancellor of the Exchequer alters the taxation he is going to propose, and that we will find ourselves in the same difficulty. Does not the right hon. Gentleman think it is somewhat exceptional for a Chancellor of the Exchequer not to have thought out his proposals beforehand, and not to come down to the House with thoroughly well-considered proposals which he has examined in all their bearing, and in which he knows he can have the support of his party in carrying them through? But there is the rub. What the Chancellor of the Exchequer has got to do is to get the support of his party, and when we remember the fact that there is a crisis of great importance to his party, we shall see the explanation of circumstances which are otherwise inexplicable.
I do not wish to repeat—if I did, I could not do it half so well—the criticism of the proposals of the Chancellor of the Exchequer by the hon. Member for St. Pancras and the hon. Member for Fulham, but surely it must be obvious to everybody that no responsible Government, no Government who have really thought out their business, or attempted to do so, could have made such proposals to any legislative assembly. It is incredible, and there must be something behind. Is it conceivable that any Government would come down to any responsible legislative assembly and ask them to pass legislation, of this kind, saying, "We are going to find some means of dividing the value due to land and the value due to improvements. We cannot tell you how we are going to do it, we have no system for doing it, and we have thought out no system." Every practical man says it is impossible to do it. It cannot be done, at any rate, on any lines suggested in this Bill. But such a proposal is on the face of it ridiculous. The Liberal party are not committed to the rating of site value. Have they ever committed themselves to that? Never, certainly not to my knowledge. The Government have never been committed to the rating of site value, and, therefore, we have to look at political pressure somewhere. We have seen political pressure exercised by the hon. Member for Newcastle-under-Lyme and his Friends, and what the Government have got to do is at one and the same time to keep the support of the hon. Member for Newcastle-under-Lyme and his Friends, and also the support of the more practical Members of the Liberal party whom he cannot carry with him in those wild and visionary schemes of so-called rating reforms. He has to keep their support as well, and the only method by which he can succeed in doing that is to go far enough to satisfy the hon. Member for Newcastle-under-Lyme and his Friends, and to say that he is going to do something, and then to say to the other Members of the Liberal party that he is not going to carry out such lunatic proposals.
That really is the whole story, and it is an insult to this Assembly that we should be asked seriously to discuss proposals at this stage, and in the form in which the right hon. Gentleman puts them before the House. After what has happened a very serious responsibility rests upon Members of the Liberal party. We are absolutely powerless on this side of the House. We can protest, and point out injustices and absurdities, but that has no weight whatever with the Government. It feeds upon them every day. It is the kind of provender in which it rejoices. But hon. Members opposite have seen what a determined stand by a comparatively small number of them can effect, and I do appeal to hon. Members opposite to study these proposals, and if they believe, as I think they must believe from a study of them, that they are impracticable, they at least have a right to demand that the Government should make absolutely clear how they propose finally to make this division, and how they propose to carry it out before they subject individual taxpayers and ratepayers, and owners of property in this country, to the kind of inquisition and expenditure which are going to be entailed upon them by this Bill. According to these proposals every individual ratepayer in the country, every owner and every occupier of any hereditament has, under a penalty of £50, to make a return fen times worse than Form IV. I hope that every Member will read it. He has to state for fifty years back the nature of every improvement which has been made in his property, whether rural or urban. The thing is very obscure, but I have examined it, and I take the words to mean that it applies to both kinds of property equally. In passing I may ask: Why limit it to fifty years? There is no possible justification in equity for that. Prairie value did not begin fifty years ago. Putting that question aside, I ask any hon. Member of this House to cast his mind upon any little bit of property which he owns or of which he has any knowledge, and to ask himself whether he or the owner of that property can possibly carry out the requirements of that return. How is it possible for anyone to state every improvement which has been made during the last fifty years, what that improvement cost, and what is the exact value of that improvement to-day?
On a point of Order. Is the hon. Member entitled to discuss in this Debate the provisions of the Revenue Bill, which do not come at all into this Finance Bill?
I do not think that the hon. Member is in order in discussing them in detail, but, of course, reference to Clause 1 of the Revenue Bill is admissible.
I submit that the hon. Member has already discussed every Clause in the Revenue Bill.
On a point of Order. The Grants referred to in Clause 13 are conditional upon this information being obtained. I would submit, therefore, that Clause 13 cannot really be discussed without considering what the information is.
It ought not to be discussed in great detail. I think that the hon. Member for St. Pancras would agree, in reference to Clause 1 of the Revenue Bill, that if we are going to discuss it in the Revenue Bill we must not discuss it in great detail now.
I had in mind your ruling in the earlier stage, that when we were discussing the raising of the money we might also discuss the methods by which it was to be applied. I hope that I have not been going too much into detail. If I had been I think that you would have reproved me, but perhaps the statement which I was making was a little inconvenient to the hon. Member. I take his interruption rather as a compliment. It implies that I am rather getting home. I do not propose to go into the point in any detail. All I was pointing out is the consequence of giving a Second Reading to this Bill committing us to this procedure. I have finished all I had to say upon the point of Clause 1 of the Revenue Bill, to which hon. Members will be more or less committing themselves by voting for the Second Reading of this Bill and this form of procedure, by which the hon. Member for St. Pancras pointed out, as I was endeavouring to point out, perhaps a little more in detail, we are committing ourselves to demanding from every owner of every hereditament in the country an absolutely impossible task. Is there any Assembly in the world which really could be asked to do that? It seems to me incredible that the Government should come down solemnly and ask the House of Commons to carry out such a proposal. Honestly, the only reason seems to me to be that the Government has been forced into such a position that this is really a sort of desperate attempt to get through the rocks which threaten it on every side.
There is not the slightest use in appealing to the Government. Therefore I appeal to every hon. Member of this House to look at these proposals for himself and to take the responsiblity of saying whether he will support them or not. If hon. Members will do that, then I think that the Government will find that the Bill will be very difficult to pass. Another consequence of this legislation must be to increase largely the enormous expenditure on litigation which the Valuation Department have already thrown upon the taxpayers of this country, and also upon private individuals. When we come to the Revenue Bill—I merely say this in passing—anybody who comes to read what is proposed and examines the extraordinary combination of an untelligible Valuation Act already in existence, and the superimposition on that of the new Clauses of this very unintelligible Bill, with its slovenly drafting, will realise that it will produce a harvest of litigation, the end of which no one can foresee. There is not a single member of the vegetable kingdom which cannot be the subject of litigation. You may have a question about every blade of grass, as to whether it is the result of improvement, or about every bush or tree, as to whether it is planted or sown. The whole of this proposal is so impracticable, and is so impossible, that I hope that even now the Government will see its way to make some further change. The right hon. Gentleman said that he thought that the change was a very small one. My own view is that the change is a small one comparatively in appearance, but a very large one in fact. We carry our minds to the remarks which were made about time by the right hon. Gentleman the President of the Local Government Board, and if those remarks meant anything, and if we remember that we are now getting towards the end of June, and we have been told that there is to be no Autumn Session, and if we remember the heavy programme of legislation which we have still to settle in this House, then I think that although the nominal change at the moment is the division of the Bill into two, and that therefore, we are to have three Bills founded upon the Financial Resolutions instead of one Bill, and that the only legislative change is the abolition of the temporary Grants to local authorities, yet the real change is that the one Bill, which will be passed, will be the Taxing Bill, and that the other two Bills will never be passed at all this Session.
That appears to me to be the obvious outlook. If that is so, that of course is a way in which the Government will escape from the absurdity of their own proposals; but the Grants to local authorities will be deferred for a very long time. The Chancellor of the Exchequer himself, in words that have already been quoted, said:— relief would be more real than the relief given which would be accompanied by such measure of Government control, and what has been very aptly termed ginger, as would reduce the relief to the ratepayers to nothing at all.
In my view the relief should be given to the ratepayer. As a matter of principle there should be a method adopted by this House in dealing with local authorities, so that there would be a fixed proportion of expenditure between the rating authority, and the money provided by this House. There is some approach to that I know in these proposals. If this House orders services for expenditure, this House ought to bear some considerable proportion of the cost of those services. It is a most unfortunate principle that this House can order the carrying out of services and duties involving heavy expenditure which does not fall upon the Budget of the Chancellor of the Exchequer. A far better system it seems to me would be to establish a definite proportion in matters particularly of education and main roads, between the expenditure falling upon local authorities and the expenditure falling upon the Exchequer. So far as that is concerned, no question whatever arises as to the necessity of dividing rating between the land and the buildings. So far as that division affects agriculture, the Chancellor of the Exchequer very recently stated that he had had the advantage of examining the accounts and particulars of several agricultural properties, and that he was convinced that almost the whole of the value of those agricultural properties was due to improvements, and that little, or none of it, was inherent value. I think that everybody probably on both sides of the House knows that that is so. If that is so, why should we impose upon the owners and occupiers of agricultural properties the enormous expense of tabulating the whole of those improvements in order to arrive at a division which the Chancellor of the Exchequer frankly admitted does not really exist. There is no question on agricultural property of building land. I claim—I do not know whether I shall have much support in this—that the top nine inches of the soil is an improvement in itself. In the hundreds of years of cultivation of the land that we have had the whole of the top nine inches of agricultural land in this country is manmade, and when you are dealing with a purely agricultural value to-day, if you take this expenditure on the land by the owner in equipping it, and by the tenant and occupier in cultivating it, there is practically no value remaining in that agricultural property—when it has no residential or building value—except merely the bare interest in the expenditure that has been incurred by the owners, and tenants and occupiers.
The Chancellor of the Exchequer has stated that the taxes he has imposed put no heavy direct burden on agricultural land. Supposing we give him credit for not putting any direct burden on agricultural land, surely he must recognise that there is an indirect burden placed on every owner of agricultural land in filling up these innumerable returns, in litigation, and in the worry and cost of complying with the Treasury forms and regulations with which owners of land have been pestered and bothered, and whose difficulties, if this legislation is passed, will be ten times worse. And all this is without any object whatever. The imposing of this enormous heavy taxation upon every owner of land will be productive of no benefit whatever either to the Revenue or to any individual. And here we have a proposal which is going to make matters a great deal worse. In the urban districts this proposed addition will be very unfair. Let us take the case of two shops—say, of two butchers—any other tradesman would do equally well—who occupy premises of equal value under the present rating system. Let us take it that the premises are properly valued at £200 a year each. In the case of one butcher, whose premises, are in the middle of the town, those premises might conceivably be thought to be in such a position that they could be used with advantage for the purposes of a bank. The premises of the other butcher are a couple of streets away, but the house may be a little better, though the site is not so valuable. The businesses of the two butchers are of equal annual value, but one happens to have his shop on a site of higher value than is the site of the other shop. According to the Government proposals, the relief to be given to one butcher is going to be very much greater than the relief given to the other, simply because the latter happens to be occupying a site nearer the centre of the town.
Is that just or fair? And would the butcher regard it as just or fair? What you have to consider is not a mere abstract proposal made, perhaps, by some political economist, who works it out over a period of years in order to present it as equitable, but you have to consider the matter from the point of view of those who have got their living to make under the ordinary conditions of the industrial community. According to the illustration which I have given, however, simply because somebody thinks that one of the two premises might be suitable for a bank, therefore the man who occupied those premises has to pay more rates than his neighbour. That is not a practical proposition. But may I say that I see no inherent injustice whatever in putting rates or taxes upon land value. None whatever. If you start in a new community with the land on which no improvements have yet been made, if you proceed to impose rates and taxes upon that land at the value it then has, and if you proceed to allow for every improvement when and as it is made, then everybody will accept the system, though, where it has been tried in new countries, they are already beginning to find its weak points. I can produce evidence to show that it is failing to carry out the expectations of those who introduced it. That is not a question of justice, however; it is a question of convenience to the community. If you impose the tax in the first instance, before the land is improved, you are putting no injustice on the owners of the land. They know that the tax is there, and they make allowance for it, and everybody who buys or occupies land knows the conditions under which they take it. But you come into this, an old country, with its great civilisation, where improvements have been going on for hundreds of years, and proceed to impose this totally new system upon the people, who have made their bargains, who have bought their land, and who have occupied their properties, with reference to those existing conditions. You suddenly—purely because in theory you believe your system of taxation is better than the existing one—propose to alter the existing system, and ask everybody who is occupying or who has bought land to go back and give every kind of detail about the improvements which have been made on the land and the time at which they were made—when those who effected the improvements had no suspicion that they would ever be called upon to account for them.
The right hon. Gentleman gets up in the House of Commons and says it is not desirable to discourage improvements by rating them. If anything is likely to discourage improvements, it is this kind of legislation. I cannot see any very great consistency in the Government telling the House of Commons that it is unfair to discourage improvements by rating them. The Chancellor of the Exchequer says that to rate improvements is a discouragement, but if the right hon. Gentleman wants to encourage improvements, why does he not reduce the Income Tax and Death Duties? If anybody spends on his house £1,000, the value of that house under the Death Duties is liable to a charge of from 15 per cent. to 30 per cent. Is not that a discouragement? The real fact is that you can only get your income, either national or local, from improved values created by individuals. There are no other means of getting it. But the Government seem to think that they can go on some kind of inverted system by which the people who improve their position are to pay no taxes, and those only are to pay taxes who never need to improve their property or who make no improvements at all. That is a totally impossible system. For a long time I have advocated the suggestion made by the hon. Member for St. Pancras (Mr. Cassel). The difficulty about discouraging improvements is quite easily met by a moratorium. The right hon. Gentleman thinks not. I think it could be. The real and justifiable complaint of the ratepayer is that he spends money upon improvements, and, before they have had time to fructify, before he can derive any benefit from them, the assessment committee comes down upon him, and he has to pay rates before he receives any additional income from them. It seems to me you could allow the local authority to defer the assessment of an improvement to rates for a certain period, according to the character of the improvement that is made. That would be an encouragement to people, and they would not be assessed to rates until the improvement had been allowed time to fructify and be of some benefit to the individual and the community of which he forms part. That would meet the difficulty, and I think is a much better way than upsetting the whole rating system.
These proposals of the Government have completely obscured the whole general issue of finance. There are many points which show how enormously the expenditure has been increased by the party which was returned to office on the ground of retrenchment. The party were pledged to retrenchment, yet we have learnt from the carefully calculated figures published in articles by a writer who was a Member of this House for a long time—and I wish he were here to-day—Mr. Harold Cox, a great authority on these matters, and who sat on the opposite side of the House, that the increased expenditure since the right hon. Gentleman took office has been no less than £56,000,000 in six years. We must reduce that sum by something like £3,000,000 or £2,500,000 owing to the change in the Budget. That will make, at any rate, £53,000,000, and in that calculation is not taken into account the direct insurance charge of 4d., which is a tax amounting to £15,000,000. [An HON. MEMBER: "That is not a fact!"] The hon. Member apparently does not understand the point I am making, which is that the expenditure of this country has increased by £53,000,000.
A moment ago the right hon. Gentleman asked the Chancellor of the Exchequer to keep the penny on the Income Tax, and spend another £2,000,000 or £3,000,000.
I do not see how that bears upon it. I am perfectly prepared to deal with that; £3,000,000 is a long overdue debt. Because you are extravagant, I suppose that is no reason why you should not pay your debts. What we complain of is the extravagance of the Chancellor of the Exchequer's Budget and the increased expenditure of this country.
The Navy and old age pensions.
The Navy and old age pensions are responsible for a certain amount of the expenditure. As a matter of fact, out of that increase, £20,000,000 has gone on defensive forces; old age pensions, £12,000,000—
National insurance, £11,000,000.
7.0 P.M.
When you come to national insurance, I am afraid the criticism which I should pass is that a large proportion of that money has been wasted upon extravagant administration. [HON. MEMBERS: "NO, no!"] When the hon. Member opposite recalls the benefits the answer to that is a very simple one. It is this. Will anybody maintain that the country gets for the £16,000,000, and it is more than that, it is about £23,000,000, raised in taxes and paid in fourpences and threepences. [An HON. MEMBER: "£27,000,000."] I am glad I understated it. The right hon. Gentleman is always dealing with that by pointing out that this person or that person receives some benefit. The right hon. Gentleman, I think, would find it very difficult to spend £27,000,000 without benefiting somebody. The question which this House has to consider is whether the country gets £27,000,000 worth of benefit. I do not get up here to say that it does riot, and I have no more right to say it does not than the right hon. Gentleman has to say that it does get that amount of benefit. What I complain of is that the House of Commons never had the chance of going into that point. I say that the expenditure is wasteful. Take that case of the spending of the £27,000,000—
I am sure the hon. Gentleman does not want to mislead the House, nor do we support it. That £27,000,000 includes employers' contributions and workmen's.
I think I said so. Is not that a tax? [HON. MEMBERS: "No, no!"]
Are friendly society subscriptions a tax?
Because they are voluntary. There is the difference. If the hon. Gentleman opposite sends a subscription to anybody in his Division, is that a tax compulsorily raised from him? Of course, this is a tax, and I believe it has been held in a Court of Law to be so. I personally can see no difference whatever whether this House raises the money in the form of taxation and then distributes it in old age pensions, or whether it raises the money by compulsory contributions from employers and employed, and then devotes it to purposes of insurance. I speak only my own view, which is, that it fulfils all the requirements to make it a tax, and that the country is being taxed to the amount of £27,000,000 in order to pay insurance benefits. As I have said I should not be justified in saying that the country does not get £27,000,000 worth of benefit any more than the Chancellor of the Exchequer would be justified in saying that it does. The Chancellor of the Exchequer I know will say so, and I am quite sure is perfectly ready to make that statement, but the difficulty is to prove it. When we take the cost of the administration of that Act—[An HON. MEMBER: "That has nothing to do with it."] That is the whole point, the wasteful administration. An hon. Gentleman opposite referred to friendly societies. Compare the cost of administration of the benefits under friendly societies and under the Insurance Act, and if you do that you will very easily see what I mean. [An HON. MEMBER: "It was more formally."]
Look at the wasteful and extravagant administration of the Valuation Department where you have expended so much in administration beyond what you have got in the form of taxes. I do not think it needs argument, because the right hon. Gentleman's administration is a byword for extravagance and slovenly finance—an absolute byword. The right hon. Gentleman mistook his vocation when he went to the Treasury. He would have been an admirable head of a spending Department, provided you had a strong Chancellor of the Exchequer to restrain the exuberance of his eleemosynary expenditure. It was observable that when the present Prime Minister was Chancellor of the Exchequer the expenditure did not grow at the same rate that it grows now. A mistake was made when the right hon. Gentleman became Chancellor of the Exchequer. Everybody hoped that when he did he would acquire some sense of financial responsibility in all these years, but he has no more sense of financial responsibility now than when he first entered this House. I can only say that we could not ask for a more powerful commentary on the right hon. Gentleman as a financier than the position in which the House and country finds itself to-day.
I will not attempt to follow the hon. Gentleman into his discussion on the Insurance Act, because I think it was rather wide of the mark. A great part of his earlier remarks was devoted to the topic of the impracticability of valuing land and sites, apart from building and improvement. In an old country there are undoubtedly considerable difficulties at points, but that the valuation, broadly speaking, is practicable is being and has been demonstrated. Let me say a word about this point of the two butchers occupying two business premises within a couple of streets of one another as to the effect of increasing the tax or relieving the rates on the building and leaving them as they are on the land. The suggestion is that this would fall upon the butchers, and that the butcher two streets away would be relieved, while the butcher in the central position would be more heavily taxed. During the time that any lease or agreement was running, unless such contract were interfered with, which I hope no Government in this country will attempt, that would be so, but the moment that the lease terminated or the agreement came to an end, then the burden would not fall on and the relief would not be given to the occupier. What determines; the rent which a man will pay for his premises? It is their value, and the rent is determined by their value and the rates; he has to pay. The rates are part of the cost to him. If the rates are higher he will pay less rent, unless the value of the premises has, owing to other events, gone up, and if the rates are diminished the owner will be able to get more rent—while the value of the property will remain the same. What determines the total payment is the value in the market, which depends on supply and demand, and is altogether apart from the rates. Therefore at the end of any present agreement or lease, if the market value remained the same, the tenant would pay no more, but where the rates have been relieved the owner would get more rent, and where they have been increased the owner would get less. Therefore I suggest that the hon. Gentleman's contention is an unsound one.
Both the hon. Gentleman (Mr. Pretyman) and the hon. (Baronet the Member for Ayr Burghs (Sir G. Younger) made some criticism of the Income Tax and of the Death Duties. Nobody likes paying taxes,—all taxes are unpopular and unpleasant, and we gladly avoid them. But I venture to say that for national purposes and for onerous burdens there are no fairer taxes in this country than Income Tax and Death Duties. Onerous burdens, national, burdens, ought to be borne in proportion to the ability of the person to pay, and you get the best tests of the ability of the person to pay first of all from the income which the person enjoys, and, secondly from the amount of money which the person leaves when it passes to other people. If you could have, as the President of the Local Government Board remarked, a local Income Tax, that would be one of the best methods of raising your local revenue to meet local expenditure of an onerous or national character, but a local Income Tax, as he clearly showed, and as everyone who has gone into the question knows, is practically impossible and is not practicable. You have taken the next best thing to it by giving relief to local taxation from revenue which is largely raised from Income Tax. I would say to the Chancellor of the Exchequer with regard to the Income Tax that the time has come when it ought to be very much simplified. The various rates and the various abatements and the various concessions and the innumerable Acts we have bearing on them have made the thing most confusing and almost impossible for any ordinary man to understand. The whole thing now needs revising, and the law on the subject should be consolidated.
With regard to Death Duties, they are getting pretty stiff. On the whole, while it is desirable and just that the nation should encourage every man of ability and capacity to put forward that ability and capacity to the full extent, and while we ought to encourage such a man and to secure for him such a reward for his industry and effort and ability and skill, and protect the fortune which he makes if successful, and see to it that he is able to leave a very large proportion of his fortune to his family, for one of the inducements to go on making money and benefiting the community and carrying on great enterprises is that he may benefit his family and those who follow him; yet, while I agree that is quite right and proper, I do contend that no man, however great his ability, and however great the services he has rendered to the State, was ever so able, or the reward required for his services sufficient, to justify him in being allowed to claim to benefit future generations for all time to come. There is a limit. I think it is a very healthy and proper method that the State should from time to time as the property passes levy a toll upon it for the benefit of the community, and also to apply some stimulus to those who are reaping the benefit of exertions made, it may be, centuries ago, to do something for their own living. I do agree they are getting to a pretty high point, and I think the yield of those taxes will require to be carefully watched, because it is quite possible to get a tax to a point when it will cease to yield as much as we ought to get from it. The inducement which very high taxes give to people to avoid and evade them is very considerable indeed, and I think they are getting pretty high.
With regard to our expenditure, there is no doubt about it, we have got to make up our minds that expenditure on social reform and for the benefit of the condition of the people has come to stay, and we shall have more of it. One of the things that the people of this country have got very firmly into their minds is this: that under our system, and I believe under all systems, the rewards for success are too great and the punishments for failure are too heavy. One way in which you can rectify that is for the State to make its levies fairly freely upon those who have been successful or have inherited great wealth, in order to some extent to relieve the undue heaviness of the burdens which fall upon those who have been less successful. I have no sympathy whatever with the theories which have been recently propounded by a great commercial authority on the other side of the Atlantic, who seems to think that the remedy for all the troubles that we have, or, at any rate, the way to maintain our commercial position, is to keep down wages. It is low wages that we are to seek. That, in my judgment, is not sound. You do want cheap work, but you will not get that from low-paid labour. What you want is efficient work. That is the cheapest work, and you will not get efficient work unless you have men well paid, well housed, well fed, and well trained. The right hon. Gentleman the Member for Fulham (Mr. Hayes Fisher) regrets very much the delay in making these local Grants, and he regrets also the national valuation. I differ entirely. I welcome the delay. I welcome the national valuation. The relief for local authorities is long overdue; but they have waited forty years for it, but we had better wait another few months than do it in the rush and hurry in which we were going to do it under this Bill as it is brought forward. It is a very difficult and complicated problem; it is a big thing; it requires a great deal of consideration, and we were going to do it in too big a rush. It wants very full consideration. These wretched Grants and doles which we have been continually giving to local authorities have been a mere make-shift. Year after year we have been pushing along, and we have not this Session the time, nor has the House before it the information, to enable us properly to readjust the system of local Grants and local taxation. Therefore, while I would gladly see the local authorities get some relief this year, I am certain it is wiser and better that we should wait until we can give this question the fuller consideration which we shall be able to do.
I feel very strongly that it is extremely desirable to have the new valuation before there are any new Grants. It would be a make-shift patching business unless you made the Grants on the basis of the new valuation. That new valuation will alter the conditions under which the Grants are given. It will alter the amounts that will go to different localities. If you gave the Grants temporarily for a year or two, and then had to alter them under the new valuation, it would be very disturbing, very inconvenient, and, in my judgment, very inadvisable. We had better start the new Grant on the new valuation in the proper way. I agree absolutely as to the necessity for rating reform. The inequality between districts is great. A very large amount of the money levied by local rates is for national services—services as national as the Army and the Navy—and they ought to be paid for on a similar basis. We have thrown them one after another on the localities, with the result that the burden has fallen upon one class of property alone. People should pay for these national services according to their income and their ability to pay, and the more you get that payment from national sources, the nearer you will get to that basis. As it is, these services are, generally speaking, mainly required in the poorest districts. The Poor Law is a national service. Education is a national service. But the cost to the public for education and for Poor Law is greatest in the poorest districts, where property is the least valuable, and the people are least able to bear the burden. That needs adjustment, and it is a reason for giving relief.
In the ordinary way these charges ought to be national charges, but everybody knows that owing to the nature of the services it is absolutely essential that they should be locally administered. If you have to have local administration, you cannot provide all the money from national sources, or you will have extravagance, waste and incompetence. If you are to have local administration, you must have a certain amount of the revenue locally provided. That is a reason for the local rates, but it is no reason why the contribution from the State should not be greater than before. I fully agree in that connection that with the greater contribution from the State you should have more supervision to tune local authorities up to the mark. I agree with my hon. Friend in speaking most highly and appreciatively of the services which have been rendered by local administrators throughout the country. Boards of guardians and other bodies have rendered inestimable services to the State. But the best men that ever lived are none the worse for being looked after. I say that local authorities have been none the worse for being looked after as they have been up to the present time by the Local Government Board, and in some respects some of them will be none the worse for being tuned up a little more. Therefore, I think it is a good arrangement that in connection with further Grants of money the opportunity should be taken to see that certain services are efficiently carried out. My right hon. Friend the Member for West Islington (Mr. Lough) talked about the supervision of the House of Commons. I dread having any more work thrown upon the House of Commons. I do not think that we shall be able to do very much in the way of supervising local authorities, except in so far as it is done by the great Departments of the State.
The House of Commons generally means increase.
That is a point which the right hon. Gentleman has very properly got strongly in mind. The House of Commons, as a whole, is the last body in the world to be justified in complaining about extravagance, because it is continually asking for additional expenditure on different matters.
With regard to the arrangement which is suggested as a means of indirectly taxing site values, it is proposed that the rate in future shall be heavier on the site value, as we call it, than on the improvements and the building. Within moderate limits that has always seemed to me to be a reasonable and fair proposal, and ever since I have been in this House I have voted for measures of that kind. It is just and fair, but it is not going to make the difference or work the revolution that some of my hon. Friends imagine. Some hon. Members are under a very great delusion as to what the benefit will be. It will not cheapen the price of land; it will increase it in some directions. When you reduce the rates on buildings in the suburbs or on the outskirts of a town, you enable the owner of building land there to get a better price for it than when the rates were higher. The price that a man can get for his land—I am speaking now of building land—depends upon the rent that the man who builds a house upon it can get for the total concern—house and land. The amount that he can get for that house will depend upon the rates that are levied upon it. The rates and the rent together will represent the value to the man who occupies it. The rates levied upon it come out of the value of the land. If you reduce those rates—whether you are levying on the land or on the house does not matter—you reduce the rates that will be levied on the whole property when the house is erected, and you will enable the man to get a bigger price for his land than before.
One of the greatest difficulties is to make people clear their minds on the very difficult question of the incidence of rates and taxes. If some of our Friends would study the question further, so that they knew a little more about it, they would talk far less nonsense than they do to-day. Many different opinions are put forward. I have noticed that in this Debate various curious opinions have been expressed. The hon. Member for Chelmsford (Mr. Pretyman) is of opinion that when you get the Income Tax and Death Duties pretty heavy a considerable portion of them filter to other classes—that means that the heavy burdens of which he speaks are going to filter down to other people. I do not agree, but if it is true it ought to be comforting for him. The hon. Baronet the Member for St. George's, Hanover Square (Sir A. Henderson), expressed the opinion that one result of the taxation that we have had has been to put up retail prices. He has yet to grapple with the point put up by my hon. Friend that the increase of prices has gone on all over the world. The hon. Member for Blackburn (Mr. Snowden) says that the masses of the people pay these taxes, in the sense that in the main they create the wealth out of which the taxes are paid. It is not the fact, but if that be so, may he not have to tell the working people that they are gaining nothing by our taxing the rich and levying heavy Death Duties, because, according to the hon. Member, they have to pay in the long run? That is a curious doctrine. The hon. Member for Newcastle-under-Lyme (Mr. Wedgwood) tells us that Income Tax and Death Duties will be transferred to the consumer? The consumer of what? How are you going to transfer Death Duties to any consumer? The hon. Member further says that the working classes in the long run will pay all the taxes. If anyone will turn to an article written by the same hon. Member, in, I think, the "Economic Journal" for September, 1912, he will find that the hon. Member says there that all rates and taxes of all kinds fall on land. If these good Friends of ours would clear their minds so that they may know what they really do mean when they speak about these subjects, it would facilitate them very much in discussing them. Even the Chancellor of the Exchequer said that if the relief was given on improvements and not on the site value, that was a guarantee that the site-owner would not get the benefit. It is no guarantee whatever. The site-owner will get the benefit.
My right hon. Friend is not quoting the whole of what I said. I said that he would not get the. benefit qua site-owner.
I mean as site-owner. You may do what you like, you may levy where you like, he will get the benefit. It was clear enough to our Friends when we were dealing with the Agricultural Rates Act. The principles of political economy do not change when you cross from agricultural and rural districts to urban districts. It does not matter on whom you levy the rate. It is just the same as with Protective Import Duties. It does not matter where you collect them to begin with. It would not matter whether you were collecting them at the port of a foreign country or at the port here, or where you collect them: taxes on imported goods will raise prices. Levying rates on land value as distinct from other value will alter very considerably the amount paid by the different classes of landowners in different places. You will increase the amount paid by the owners of sites in central positions and reduce the amount paid by owners of sites in outlying positions. One effect of that will be to reduce the value of the land—because the rates are more—in the central districts, and to increase it in the outlying districts. Landowners, as a whole, will not be materially affected by the mere change in the method of making the levy. As between one and another it will make a difference, but it will not make any difference as regards the whole. I estimate that something like three-quarters or four-fifths of the relief you give will ultimately go to the benefit of the landowner. It will take some time to work there, owing to the present leases. That is where the occupier has had a grievance.
Another point we must bear in mind in connection with this Grant. It is the application of the old principle of "easy come, easy go." When you give a Grant to local authorities the tendency and temptation to spend a little more freely will be increased. In addition, we shall have the stimulus of the Government on these local authorities to be efficient in various directions, which will mean more expenditure; therefore, I am not sure that the rates, in the long run, are going to be relieved very materially by those Grants. But if there be wise expenditure, that additional expenditure should be of a beneficial and profitable character. I do feel that the question needs very careful consideration, and therefore I am glad of the delay, and welcome the postponement. I think that we need a good deal of information. It is not satisfactory that the Government and their officials only should know all about these things; the House of Commons needs to know. We have not got the information. The fact is Ministers and the Departments do not yet know themselves. These are extraordinary provisions in this Schedule:—
"Such contributions as may be fixed by the Secretary of State with the approval of the Treasury."
That is slack and loose enough. We want to have more definite information and more definite control than that. One result of our postponement must inevitably be that we shall get this further information. The matter requires a good deal of discussion, and then, when we have discussed it and determined what we are going to do, what we are going to give and how we are going to give it, then and not till then is the time for providing the money. We must not be in too great a hurry. One of the difficulties in which the Government have found themselves during these last two or three days has been the result of being in a hurry. [HON. MEMBERS: "Hear, hear!"] Yes, but hon. and right hon. Gentlemen opposite must bear some responsibility for that. [HON. MEMBEBS: "Why?"] When we are wanting to carry measures through on this side which you opposite, if you were on this side, could carry through in a single Session, we have to fight them through for three Sessions, occupying our time, and keeping us away from problems with which we want to deal. The result is that we are rushed and compelled to legislate under pressure, because of the difficulty we have in carrying our measures. The Chancellor of the Exchequer will pardon me if I do say that I feel there is some force in the criticism which has been made from time to time that the Treasury has ceased to be so much as it used to be the watchdog of expenditure. I do not like the idea of great schemes of expenditure emanating from the Treasury. The Treasury—and the Chancellor of the Exchequer in particular—should be more and more watchdogs. That is especially necessary when we have got a Budget running up to £200,000,000, an unparalleled amount in times of peace. I am not objecting to much of it.
But it does become more and more important when the expenditure is large that it should be closely watched and closely criticised by the Treasury, and by the Chancellor of the Exchequer. I feel that one of the dangers to our Liberal party is laxity in financial matters; in departure from sound traditions and practice. Therefore, I am glad of this delay. I am not troubled about the expenditure if it be wise and useful. I agree with those who pointed out that we can afford it, but that you can afford a thing is no reason for having it if it be wasteful and unnecessary. You need to watch it very carefully indeed. I am beginning to feel a bit uncomfortable—more than a bit un-comfortable—about this enormous expenditure on armaments. The expenditure on the interest of the National Debt—which is very largely payment for past wars—and on the Army and Navy now, represent, roughly, one half of this £200,000,000 Budget. That is the part of our expenditure that I am troubled about. We are prosperous now. We have had a great time in trade. We have made a lot of money. The national revenue has bounded up, with the incomes of the individuals who form the nation. The expenditure is enormous. A good deal of this expenditure which we are now about to initiate will continue and grow, and it will continue and grow when a time of depression comes. We need to watch these things carefully, for when our national revenue is not so booming as today, and the expenditure on which we are embarking has grown greater, we may find ourselves in difficulties. We must also remember that there is a possibility of serious national crisis and of war. We want to ask, are we getting value for our money? Are we crippling production? Are we withdrawing money from employment? I do not think we are to the extent to which people think. The test of wisdom in expenditure is what are you getting for it.
We have heard about expenditure on motor cars and on gardeners being stopped. If the money which would have been spent on motor cars and gardeners is used for useful and beneficial purposes it will give as much employment in the direction in which it is used as it would have done if it had been spent on motor cars and gardeners. In addition to the fact of the expenditure being beneficial and to the well-being of the nation, it will add to our wealth rather than diminish it. We can, I hold, make no better expenditure in this country than the money we lay out on the education of our people, on national insurance—upon which the hon. Member has commented somewhat harshly—and on all the schemes which go to promote the health, the well-being, and the capacity of our people. That is beneficial and profitable expenditure. That expenditure will employ labour just as much as expenditure on luxuries will; it will do far more good to the nation, and we shall be the better for it. When we do that we are developing the very best and most important assets that we have got. The only part of public expenditure I do not like is that on warlike preparations. What I am anxious about in connection with the other is that we should see that we get value for our money. In connection with these local Grants I am glad we are to have a little more time to think, so that they may be more properly adapted to the purposes for which they are intended.
The right hon. Gentleman who just sat down has performed the most successful straddle that I ever witnessed. I really should like for my own confidential information to take him outside privately and hear his confidential opinion of the Chancellor of the Exchequer, because, from what I have observed, I really think that the right hon. Gentleman should have been in the front of that famous round robin signed by the Radical millionaires.
No.
I say he should have been. This House has not yet congratulated the hon. Member for Hexham (Mr. Holt) upon the great victory that he has achieved. I venture to congratulate him. I am very sorry that Hexham is not in Ireland instead of England, for I conceive that some twenty Radical gentlemen have been able to "brake" the Chancellor of the Exchequer—[Laughter.]3—I mean brake in the sense of braking a railway train—to prevent the passage of this extraordinary Bill. I sincerely regret that the hon. Member for Hexham was not, at all events for a few days, the Leader of the Irish party. Twenty men have practically transformed the whole situation, whereas the hon. Member for Waterford (Mr. J. Redmond), swallows every nostrum that the Chancellor of the Exchequer puts forward, winding up with his carving-knife policy with regard to Ulster. The Chancellor of the Exchequer can congratulate himself on one thing. He has had very faithful colleagues both to-day and yesterday. I never heard a more adroit speech than the speech of the President of the Local Government Board. I never saw a man let down so gently as was the right hon. Gentleman. In tidal harbours you have seen the tide gradually recede and leave, without a bump, a barge in the mud. That was the image which his performance recalled to my mind. It was quite evident from the speech of the Chancellor of the Exchequer on Saturday that he intended yesterday to carry this Bill in full, but there was an awkward Cabinet meeting on Monday morning, and when you think of the right hon. Gentleman the President of the Local Government Board emerging from that Cabinet meeting, where the perspiring Chancellor of the Exchequer was left bastinadoed by his colleagues, and imagine how in the most delicate manner he applied that unguent to his wounds, and concealing to the last moment the fact that his whole scheme of Income Tax was broken, certainly the right hon. Gentleman, if there is a vacancy in the position of Chancellor (as I hope very soon there will be), should be called upon to fill the post.
As for the right hon. Gentleman the Secretary for Scotland, as comparisons are odious, he will forgive me if I do not pay him the same compliment as I paid to the President of the Local Government Board, but, being a Scotsman, he will not expect that. He said one very remarkable thing by way of excuse for the transformation. "Oh," he said, "Mr. Gladstone abandoned certain taxes; Mr. Lowe abandoned the Match Tax; and Mr. Goschen abandoned the Wheel and Van Tax!" but the right hon. Gentleman forgot the provisional Taxation Act of last year when the Government stereotyped in the most remarkable way the rules and procedure of this House. The right hon. Gentleman passed that Act against the honest criticism of Members of this House against a great constitutional change. We suggested, instead of giving our Resolutions "statutory effect," that a certificate of the Chancellor should be an answer to an action. But he was quite incapable of understanding the situation that he created, and that has led me to think that the present Chancellor of the Exchequer is the most reckless and incapable Chancellor that ever gat upon the Government Bench. [HON. MEMBERS: "Oh, oh!"] I shall say perhaps something still more disagreeable as I go on, and I shall give chapter and verse for what I say.
The right hon. Gentleman yesterday could not even give the House accurate information on a small question of detail. We admitted last year there was a difficulty created by the action of Mr. Gibson Bowles, and we said the true way to deal with it was not to stereotype the practice of the House in an Act of Parliament as to Resolutions and Supply and Committees of Ways and Means and Second Readings of Bills, and so forth, but to provide that, after the Resolutions, a certificate of the Chancellor of the Exchequer should be a complete answer to an action. That was the suggestion made from these benches, instead of stereotyping, so to speak, the British Constitution. For the first time they inserted in an Act of Parliament references to Resolutions in Ways and Means, references to Second Reading and Report stages, and other matters of that kind. But, having had his way, what are we to say to a Minister who, having got his Bill in that shape, brings in such a complicated measure as this, having tied his hands beforehand, and then for the first time in the history of this country drops a penny in the Income Tax and practically abandons his whole scheme, including Clause 4, which is a proposal to give an additional £700,000 to Ireland.
We are told we will have it next year. Last year he invented a further splendid plan. He said, "I will divide the Budget into two parts. There is not sufficient time to discuss it in this House. My finance is not adequately discussed, and therefore I will decant all these small details into another Bill, called the Revenue Bill." He decanted the details into the Revenue Bill, and it was never heard of more. It was never passed into law. Time did not admit of making the necessary amendments to the cruel hardships of his Budget of 1909–10, which were admitted by himself and his colleagues on the Government Bench. He deprived the House of Commons of the only chance it has of making amendments to the mistakes in his Budget, because he said, "I will make my Budgets in future"—that was practically his suggestion—"purely parts of a taxing machine." Where are we now? He has now brought in his present proposals with this Gibson Bowles Act staring him in the face. Supposing that, instead of being Income Tax that was in question, it was some great article of popular consumption—sugar, tea, or suppose that it was a halfpenny upon matches that the poor vendor sells—how would you repair the evil that would have been inflicted by such legislation? Of course, with regard to tea or sugar, and all commodities of that kind, you could make it good, perhaps, to the grocer who pays the tax, but how are you going to make it good to the unfortunate consumer? It is impossible. Under the old procedure, though, no doubt you would inflict some hardship, the Minister in this House could give instructions, to his Customs and Excise officials that the tax would be dropped. What is proposed now? You have created a statutory Resolution, and the right hon. Gentleman told two stories about that last night. One was a fact, namely, he said that he is bound to go on collecting the taxes. I said, "The bankers would be deducting the extra penny," and he said it was "my usual inaccuracy." I will show him in a moment who is usually inaccurate in this House. At all events, I never had to stand in a white sheet before this Assembly.
You will in an Irish Parliament!
When it comes. I shall be delighted to stand there then. But let me call the attention of the House to what the right hon. Gentleman said. I asked, "What about the bankers?" "Oh, said he, "the bankers will easily make adjustments!" I said, "What authority have they to make adjustments?" They have no more authority than he has, and in the space of about twenty seconds he tee-to-tum'd himself round into a wholly different position. This is a specimen of his way of dealing with the House of Commons. He said:—
"The Clause in the Gibson Bowles Act to which the hon. and learned Member referred, was inserted"—
he wanted first to father it on me—
"at the instance of some hon. Members sitting round the hon Member."
That statement is absolutely untrue. The Clause was in the Bill as introduced by the Government, and the right hon. Gentleman did not hesitate in order to turn the point last night to invent that story.
To what Clause is the hon. and learned Gentleman referring? The Clause I referred to was the Clause as to the Time Table. That was suggested by the Noble Lord the Member for Oxford University, and if the hon. and learned Gentleman says that Clause was in the Bill as it was originally drafted I say again that is his usual inaccuracy.
I am not of the O'Brienite party!
Whether it is accurate or inaccurate is easily tested. I only referred to one Clause. I said the Government fectly true, but there is one thing they do not get. They do not get false figures, false information and faked returns. That is what Ireland gets, and that is what Ireland is getting from the right hon. Gentleman the Chancellor of the Exchequer, and then when he is challenged in this House he charges those who avail themselves of his returns and use his figures with fraudulently deceiving the House of Commons. I will show the House tonight who has committed fraud upon the House of Commons, and who has deceived the House of Commons.
8.0. P. M.
We have been trying for some time in face of these Budgets to get figures from the Government. We have never yet got by way of estimate or forecast since the right hon. Gentleman took office, an accurate figure. He has again and again put forward inaccurate figures, inaccurate by millions, for the purpose of deceiving this House. This is a question upon which he who runs may read. At all events every Member of this House can read, and that is a great advantage. The right hon. Gentleman proposed to give us in this Budget in consequence of the extra taxation imposed a sum of £697,500. We asked upon what basis that was calculated? It is not calculated upon a population basis; it is not calculated upon a contribution basis; it is calculated upon what he calls the "Goschen basis," omitting Police and Education Estimates. But the point is that the Police and Education Estimates are the largest Estimates passed by this House for Ireland. Education is £1,755,681, and Police—that is the Royal Irish Constabulary—£1,369,292, and the Dublin Police, to which a considerable local contribution is made, £107,472. The total of these three services is £3,232,445. What proportion on the English basis of these figures we should get I cannot say, and I do not pretend to say. I ask for information. The right hon. Gentleman has taken up a standard invented by himself which was never heard before. The late Mr. George Wyndham dropped the Goschen proportion as being unfair to Ireland. He stated in the Debate to which I will refer in a moment, that Ireland was £2,000,000 to the bad. Now, that is untrue, and it was untrue according to a return which the right hon. Gentleman himself had issued a few months before. Speaking on the 20th of May, 1914, the Chancellor of the Exchequer said:— ours is a small nation and poor people dealing with small figures £100,000 or £200,000 is a matter of enormous importance, and for a Government such as that to issue figures such as these in connection with our country is a disgrace to who ever is at the head of the Treasury. The right hon. Gentleman has charged me with misleading the House of Commons. He has charged me with a fraudulent misuse of a State Paper. In case the right hon. Gentleman might think that my paraphrase of his words might be too severe, I will quote his actual words: He said on the 8th of May, 1913:— me with having made a fraudulent use, or an improper use—the word "fraudulent" was not used on that occasion—of this Paper.
Let me give the House the facts. My statement was a very simple one. I stated that the Government had issued a State Paper signed by the right hon. Gentleman to catch votes, and I said that it was a fraudulent Paper. I maintain the expression now. I say that he deceived the House of Commons, and I say that when challenged upon the matter his resource was to further deceive the House of Commons by alleging that I had omitted the chief ingredients of the sum. He stated, that there was an increased revenue under the head of spirits. Untrue! Spirits is less—that is to say, Excise and Customs is less in 1913–14 than it was in 1909–10, at the time he issued the Paper, by £6,000. He stated that I had omitted Land Values. The estimate for Land Values in the Paper was £24,000. That was the estimate, remember, for 1909–10. They have had three or four years since then in order to make up that sum, and how much did Land Values in Ireland, estimated in 1909–10 to produce £24,000, produce last year? £5,000! And that right hon. Gentleman charged me with fraudulently deceiving the House of Commons! I repel the insinuation, and I retort it. On what figures did I fail, and to what extent? I forgot to take into account the new Licence Duty. The new Licence Duty is £81,000, whereas, as I have shown, the Government issued this Paper with the statement, "Total Revenue to be expected from Ireland in any one year," as we maintain, was £602,000, and in the Budget year £438,000. The fact is that in last year the increase, instead of either being £400,000 or £600,000, is £1,882,000.
It was attempted to be shown that increase was due to the fact that the poor people were able to spend more on luxuries through old age pensions. Unhappily, it is not the case, because tea, sugar, cocoa, and other articles of that kind are all a falling revenue in Ireland. One might have expected an increase in tea in consequence of old age pensions. There is no increase; there is a decrease. The one article in which there is an increased revenue, due to the 8d. in the £ on tobacco, is the article tobacco itself, so that you have had a falling revenue, and you have got nothing out of this great Budget that put 3s. 6d. upon our spirits. You are in the glorious position of having destroyed the distilling trade just at the time when, for purposes connected with motors and machinery, alcoholic products might turn out to be of industrial value. What satisfaction is it to English Members that John Jameson and Son cannot pay a dividend on their shares, men who were paying 10 and 20 per cent. before 1910? Having destroyed these industries and ruined them for no purpose, bringing in no revenue, and getting nothing out of it, you then turn round on the men in a small minority who venture to get up in this House and expose the facts, and you charge them with fraudulently deceiving the House of Commons.
When that is done by a person occupying the exalted position of the right hon. Gentleman, of course the public suppose there is some modicum of truth in it. Let me show the interpretation put upon his return, not by me, but by his own colleagues: the Home Secretary, the late Postmaster-General (now President of the Local Government Board), the Chancellor of the Duchy of Lancaster, and not only that, but also by the hon. Gentleman the Member for East Mayo (Mr. Dillon). Everyone of his colleagues got up and backed him, but they did not insult their critics, and we must be thankful for small mercies. I would not go into this if the right hon. Gentleman had been the pink and pearl of accuracy. I could understand his sensitiveness if he were, but he never makes a speech without making a blunder, and he never brings in a Budget but that he has to issue a second edition of it. He appears to me to be only learning his apprenticeship at the trade he has taken up. Let me tell the House how the President of the Local Government Board treated this matter. Our contention was that this Budget would—and it will—eventuate in £2,000,000 extra. Remember, we should have no cause to complain if this matter were frankly stated. We should have no cause for complaint if the Irish representatives were not to be cut down to forty-two Members, while the British Budget is still to prevail in Ireland. Remember, you have framed your Home Rule Bill on these fraudulent estimates. The Irish Members consented to having their ranks reduced to forty-two from 103, on the statement of the right hon. Gentleman that this Budget would only mean something like £600,000 a year, I would never have complained of our representation being cut down, even although the British Budget prevailed in Ireland, if there was a limit put to the extent to which the taxation would go on. Let the House mark what we were told on the 25th April, 1910. The right hon. Gentleman the then Postmaster-General, and now the President of the Local Government Board (Mr. Herbert Samuel), on that occasion said the hon. Member for Cork (Mr. O'Brien) declared:—
Do I understand the hon. and learned Gentleman to say that he wants Ireland to be left out of this Budget? Am I to understand that?
The right hon. Gentleman will have his opportunity of replying later on.
But I want to know before I reply. The hon. and learned Gentleman says all he wants is to be left alone. Do I understand him, "therefore, to say on behalf of his country, that it wants to be left alone. Do I understand him to suggest that Ireland should be left out of this Budget? Is that his suggestion?
I will tell the right hon. Gentleman what my suggestion is. It is that we should be allowed to run our own country and our own taxation. You have been convicted of extracting £200,000,000 needlessly and wrongfully from our country over the last century. What we have now to say is this: give us the management and control of our own till. Give us the management of our own taxation and of our own figures, and we will never come to England for a bawbee.
The hon. and learned Gentleman has been treating me severely for some time, and he has ended up by suggesting that all he wants is that I should leave Ireland alone. We are discussing the Budget. I again put it to him: Does he ask that Ireland should be left out of the Budget?
I propose that this £13,000,000 should be left under the control of the Irish people. The right hon. Gentleman asks me a question. When we put questions to him he does not answer them. We have been trying to acquire from him some information as to how Ireland stands under this Budget, and he refuses to give it. On the 9th June last he was asked "the amount of the increase of the revenue from Ireland, comparing the years 1908–9 and 1913–14; the various items of revenue making up the increase; and the increase under each heading?" That was a plain question. The right hon. Gentleman thinks he has the right to question me on the spur of the moment in the middle of my speech. He had two or three days' notice of that question. Did he give a straightforward answer? No, his answer was:—
"I beg to refer the hon. Member to the Tables in the Parliamentary Papers, House of Commons, No. 20s, and 1909, and Command Paper 7400 (1914)."— [OFFICIAL REPORT, 9th June, 1914, col. 163.]
And when we turned to these Command Papers we found that they did not contain the information at all. That is the way in which the right hon. Gentleman answers a question of which he has notice. Now, with regard to Ireland being omitted from the Budget, I may point out we are being omitted from it, because he has stated that Part IV. is to be dropped, and we have no security as to what will happen next year. On the hypothesis that Home Rule will be in operation, there will then be forty-two Irish Members in this House, equally divided between North and South. I believe the four counties are to be six now, and they are to retain all their present representation. In that event, the Conservative party will be in the majority in the Irish representation. Where shall we be next year when this Part IV. comes up for consideration? The over taxation which we remember was put at £400,000 three years ago, is to go steadily up and up and up. I therefore say that what we have done in this business is this: without the assistance of the majority of our countrymen, who have condoned this shameful breach of faith themselves, we have done nothing except, on the authority of State Papers, and with the aid of State Papers, and with the aid of official figures, to arraign the right hon. Gentleman of as gross a piece of deception as any official was ever guilty of.
I am not competent to follow the hon. and learned Gentleman, and therefore I do not propose to make any reference to his speech, other than to say that every well-wisher of Ireland regrets the spirit and motive of such speeches. We are met this afternoon in very peculiar circumstances, such, as I suppose, as are almost unprecedented in this House. We have had before the House a Revenue Bill, which is not actually the Bill that we have to consider. Therefore we have an Amendment submitted from the other side of the House which also has to be considered in relation to the Bill supposed to be under consideration. My colleagues and myself feel a profound regret that the Government should have capitulated to the representations of a certain number of their own supporters, and that they will have a great difficulty in the country in convincing the people that the motive of those who have applied the pressure is not rather resentment against the taxation than against the constitutional aspect of the question. Undoubtedly the Chancellor of the Exchequer has throughout his proposals of 1909 and subsequently had to encounter a great deal of hostility from such interests as those which have just prevailed and compelled us to alter the whole complexion of the Budget proposals. It is quite right that a strong protest should be entered against the abandonment of the temporary Grants to the municipalities. Those are long overdue, and Members of all parties have for years admitted that this House ought to give considerable assistance to municipalities in respect of the national duties we are constantly thrusting upon them. At last the various municipalities in the country thought that assistance was to be vouchsafed to them. Now we are told that the temporary proposals are to be abandoned, and that we are to wait until some legislation has been passed before the municipalities can hope for any reasonable amount of assistance.
For my own part, I feel that a big mistake has been made in abandoning the temporary aid. I am certain that there are means within the competence of the Government which would have allowed them to have properly fulfilled their pledge to the municipalities, and I believe, if we are to accept the professions originating from the other side of the House, that a measure giving due Parliamentary sanction to these temporary Grants might have been passed as a non-controversial measure. What is to happen now? We are to have some legislation, and the municipalities are not to get the full amount of relief promised them until a certain scheme of valuation has been carried out. My colleagues and myself have given consideration to the Amendment submitted from the other side of the House, and we would like to associate ourselves with the protest entered against the alteration of the Government's plan in respect to the abandonment of the immediate aid to municipalities, but we are unable to support the Amendment because of the provision contained in the last three lines. If the Amendment had finished at the word "purpose," I believe I may say that my colleagues would have felt compelled, in the circumstances, to have given their support to it, but we are pledged to the principle objected to in the latter part of the Amendment, because we feel that when Parliament is about to make considerable Grants-in-Aid Parliament has the right to exercise some amount of supervision and to lay down principles that shall govern the rating proposals in the country. We are not prepared to say by our votes or by our speeches that land values are not a fitting subject for local rating, therefore it is quite impossible for us to support the Amendment as it stands on the Paper. Nevertheless my colleagues feel that some form of protest has to be entered, and the only one remaining in Parliamentary practice for us is to refrain from giving support to the Government in the Lobby in that particular.
We have heard a number of interesting speeches to-day. A number of hon. Members have objected to the amount of national expenditure. No such protest, of course, will be expected from these benches. It is not the amount of expenditure that we ever criticise, but the purposes of that expenditure. We recognise that the amount of national expenditure has been growing at a very rapid rate. We are convinced that the nation can well afford its present expenditure and that it may reasonably exceed that expenditure, provided that it is expended in a manner which will tend to the real well-being of the people. When I hear hon. Gentlemen protesting against the amount of expenditure, I am constantly hoping that they will indicate the particular items of national expenditure which they would like to curtail. The right hon. Gentleman the Member for the Spen Valley (Sir T. Whittaker) did direct his criticism to the expenditure on armaments, and when I turn to the critics on the other side, they, of course, would give no sanction whatever to the diminution of expenditure on our national defences. I have always acknowledged in this House that under existing circumstances we must maintain our Army and our Navy. I agree that they should be effectively maintained, and therefore, I never utter a sweeping criticism which will lead anybody to believe that in my opinion the whole of this expenditure can be avoided. Nevertheless, I most cordially agree with those who allege that the expenditure is abnormal and might very reasonably be diminished, and that it is a subject to which Parliament ought subsequently to direct its attention. On the other hand, I have never admitted that, because the nation spends large sums on its Army and its Navy, that can be accepted as a reason why we should not expend money on urgent and beneficent proposals calculated to uplift the general mass of our people. Therefore, my observations will not be directed against the amount of expenditure, but later on I shall have to object to some omissions of expenditure and certainly, as indicated in the Amendment we have on the Paper, we shall have to object to the particular, proposals adopted by the Government for raising the necessary finance.
Here let me make one or two further references to this question of aid to local authorities. We most thoroughly agree that there should be some uniform principle of rating laid down by Parliament. The present conditions are so variable and so unsatisfactory that they cannot possibly be defended. I happen to represent a borough which occupies the very undesirable position of figuring as one of the highest rated boroughs in the country, and yet the amount of that rate is not a necessary index of the amount of local expenditure. It is not correct to say that because the rate is high in any particular borough, the expenditure there is unwarranted or undesirable, or even heavier in proportion to that of some lower rated municipality. The principles of assessment of necessity have to be considered in this matter, and therefore we have to recognise that we must consider, not only the number of pounds to be paid, but the number of pounds upon which the rates are also paid. There are such things as low assessments, and we feel that when the State is about to give large Grants out of national funds, it is but right and proper that some general uniform principle of local assessment should be laid down in order to ensure that there is a uniform basis of rating, and therefore that each will get a fair proportion of the Grants we are about to make. I recognise this problem to be extremely complex. It is very easy to talk about rating and taxation reform. When we get down to the actual consideration of the matter we all have to acknowledge that the problem is not so simple as superficial thinkers might contemplate. I always felt that Income Tax, both national and local, was the only defensible form of taxation. I still believe that it is the best, though latterly we have been assured that in respect of local purposes Income Tax is most impracticable, but that we are getting a little nearer to it is quite true in the larger Grants which are to be made out of national funds raised very largely from national Income Tax.
Whether the problem of separating site values from those of houses, buildings, improvements, etc., is going to prove an easy matter is one that I do not care to dogmatise about. I believe it can be done, but I am certain it is not going to be done within the time contemplated by the Government. Therefore, if aid to local authorities is contingent upon the completion of this very complex form of valuation, I am just as apprehensive as some speakers on the other side that the local authorities will not get this contemplated aid for several years to come. Certainly, all enthusiasts are likely to lead themselves and other people astray. I listened with considerable interest to the speech of the hon. Gentleman (Mr. Pretyman). In that portion of his speech which was directed to a consideration of this problem I thought that he did draw the attention of the House to some difficulties of the question, and certainly it was a speech that greatly impressed me, although I am not going to say I was altogether convinced by it. But still, in an old country like curs, I recognise the difficulty of differentiating these matters, and, therefore, I say I do not think the Government ought to enter lightly into it, giving the local authorities the hope and promise that they are going to complete their labours within twelve months, and that from that time the local authorities are going, not only to get large national Grants, but also new means of local revenue. I never contemplated large revenues accruing from these land proposals. What we want to get at seems to me to be this. There are, undoubtedly, large social increments inherent in land in some situations. I do not think that is a proposition which will be denied. Wherever people are compelled to live and labour in numbers there is a value inherent in land which is not the creation of the owner of that land. That is the value we want to get at. Of course we are in a difficulty because we have not before us the Government proposals for effecting it. I am not quite clear how we are going to accomplish it, but I am certain that there is a large portion of the land of the country that cannot be brought within the ambit of such a proposal as that.
If you are going to subject the whole agricultural land of the country to this form of valuation, you are going to embark upon an extraordinary expenditure which will not be remunerative, and which, in my opinion, will not bring in aid to local rating. Here, of course, I am not speaking for all my colleagues. I recognise the honesty of their views. They are aware of the fact that I am accustomed to think these things out for myself, and I will not express an opinion unless it accords with what I have concluded to be right. I have always felt that we must divide this problem up—the rural and the urban. I want to tax that form of urban value which is ascribed to social operations— that is to say, that value which grows on land without being the result of any effort or expenditure on the part of the owner of that land. I believe, on the other hand, that in respect of agricultural land there is very little value attaching to it in an old country like ours that is not mainly attributable to effort and expenditure on the part of those who own and those who cultivate the land. Therefore, if you are going to adopt the principle submitted by Government speakers and allow for improvements over a long period of years—a period now suggested as fifty years, which may have to be extended subsequently—I feel that you are not likely, through the proposal to value agricultural land on these lines, to get any great advantage either to the State or the municipalities. I wish it to be perfectly clear that on this particular line of my argument I am expressing my individual opinion and not the opinion of the party on whose behalf I am speaking. So far I have expressed the regret of those with whom I am associated that any alteration has taken place in the Government proposals. We still feel that if the Government really wanted to give immediate relief to the local authorities, there are means within its competence of granting aid this year.
I am certain that the municipalities will be grievously disappointed, because as soon as the proposals were formulated they believed that aid was to be immediately forthcoming. Now that it has been abandoned, I am willing to accept the word of the Government that it is only contemplated to be temporary, and that next year aid will be surely forthcoming. But the political situation is always so uncertain that we cannot predict what may happen by next year, and I am fearful that these complex proposals for revaluation may result in this aid being denied to local authorities for several years to come. I do not think it can be indefinitely denied. I believe that whatever party is in power they will have to deal with this question. But the problem is urgent. Local authorities have been led to expect aid this year, and we feel that the Government has made a great mistake in capitulating to pressure on their own side and in not pursuing the policy they have laid down to us. We most strongly object to the method they have adopted for disposing of the money they have been unable to expend. We cannot see why they should have reduced the Income Tax. I do not think there will be very many hon. Members who will get up and say that they see the justness of the remission. I do not think there are many hon. Members on the opposite side who will urge that they made a very strong demand for a reduction of the Income Tax. I do not know whether it is because a number of hon. Gentlemen on this side of the House feel that some limit is to be placed upon taxation and, because they have succeeded to a certain extent this year, are hoping by equal pressure to get a further reduction in another year. But I am certain that the Government's action will be greatly misunderstood in the country, and that it will be interpreted as a capitulation to wealthy interests, with a total disregard of the more pressing interests of the great masses of the people.
9.0 P.M.
We think that the balance which would be left if the Government were to carry out their taxation proposals, while not giving the Grants for local aid, should have been devoted to the remission of some of the old taxes which press with great hardness on the poorest of the population. We have been led all along to believe that this would accrue. Take, for instance, the Sugar Tax. There has never been—well, perhaps I will have to make some modification, because the Prime Minister said that he had never been pledged to the total abolition of food taxes, and therefore, I must not say that nobody on the Ministerial Bench will get up and defend food taxes. The Prime Minister told us in 1907 that there is a consensus of opinion in all quarters of the House that the Sugar Duty should be diminished, or, when the time arrives, entirely removed. In my opinion, and in the opinion of my colleagues, the time had arrived when the Government had it in their power to at least diminish the Sugar Duty as an evidence of their intention to completely abolish it another year. I remember when I was making speeches preparatory to coming to this House I joined with Radicals in all parts of the country in denouncing this tax. I knew it was put on as a war tax. I felt then that it was in-defensible, because, if there is to be war, in my opinion that war ought to be financed by the wealthy interests in the country, and not be a means of further oppressing the poor in our population. Therefore I am not arguing whether the tax should or should not have been put on them. What I am stating is that all of us made it our purpose to urge the diminution and abandonment of the tax as early as possible. Therefore we have every reason to complain that the Government have had an opportunity of remitting at least a sum of £2,000,000 of taxation now levied on sugar, that it has failed to do so, and that it has instead relieved wealthy people of a portion of their liability which we feel to have been quite just in its incidence.
Does the hon. Member describe as a remission of taxation an unwillingness on the part of the Government to make further exactions from a particular class?
I do not quite understand the hon. Gentleman's question.
The hon. Member describes it as a remission. There can be no remission of taxation which has not been imposed.
If the hon. Gentleman is subject to that taxation he will find some relief, and instead of paying. 1s. 4d. in the £, he will only pay 1s. 3d. It is a relief in respect that there is a reduction in the rate originally contemplated. The hon. Gentleman knows that payment at the higher rate is already being made.
Unjustly.
That being so, I think I am correct in describing it as a remission, and the Labour party are not in favour of that. We are told that it is only temporary, but the hon. Gentleman can at least congratulate himself that he is getting temporary relief. In our view it is relief which ought not to have been afforded him, but ought to have gone to the working classes of the country. We are told that this Government have effected a considerable reduction in the duties on food. Last year the Prime Minister told us that in respect of reductions of the Tea and Sugar Duties effected by the present Government a sum of 12s. a year was represented for each working-class family. In our opinion even the present full taxes ought not to be levied. It is said that we ought not to relieve anybody in the community from paying taxes. For my part, I say that if there are working-class families who are, for any reasons whatever, denied what is called a living wage, the State ought not to impose any taxation upon such families. First of all, you ought to ensure that each family in the State has a living wage, and only then have you a moral right to place taxation upon it. You recognise that principle in respect of Income Tax. You say that £160 a year is necessary for a man to maintain himself with his wife and family, and that, therefore, he should not be called upon to pay Income Tax if his income is less than that sum. I fail to discern any great distinction in principle between relieving that class from Income Tax and relieving the very poor from taxation in the form of taxes upon the positive necessities of life. We have never argued that all sections of the working classes' should be immune from taxation. We recognise that all ought to have the competence to pay taxes, and that all ought to pay taxes in accordance with their ability to pay them, but we do respectfully urge that there are large numbers in the community who lack the means of decent livelihood, and therefore have not the ability to contribute towards national taxation.
Thus it is that we have indicated our desire in the form of an Amendment which, I rather apprehend, cannot now be submitted to the House. We think that forms of direct taxation should be extended, and that forms of what we call indirect taxation ought to be diminished. I cannot say that I can go so far as to urge their complete abolition, because there are some forms of indirect taxation which are generally regarded as having a moral sanction, but with respect to those forms of indirect taxation which fall upon the common necessities of the people, we have constantly urged, and shall continue to urge from these benches, their complete remission and the raising of the necessary money from the incomes and accumulations of the well-to-do classes in the community. There is one question that has evolved under this Budget considerations which I would like to address to the President of the Board of Education. It arises out of the apprehension shared by a considerable number of people, that the free education rights of the people are to be destroyed. I have carefully read questions addressed to the right hon. Gentleman and the responses which he has made to those questions. I believe that there is no foundation for thinking that the Government ever had in contemplation the repeal of the free education rights of the people, and that if any such danger exists, it has arisen from causes beyond their contemplation. We have the opinion of the right hon. Gentleman, reinforced by his legal advisers, that this does not repeal these provisions. Nevertheless, I feel that he will do well to satisfy, what undoubtedly is very widespread misgiving in the country, by enacting specifically that the people will still have that right of free education. Serious inroads have been made on the principle of late. A number of cases exist in the country where fees are now being charged, which, at any rate, appear to a number of us to have made a breach in the right of parents. I know that it is urged that there are improved accommodation extended curriculum, and so on, which have allowed the Department to sanction the fees being levied. But we on these benches believe that the fullest form of national education should be placed within the reach of every parent in the land. Therefore, of necessity, we view with grave alarm any possibility of that principle being destroyed.
The great complaint which always seems to have emerged from these discussions is as to the amount of expenditure. We, on these benches, never raised any such complaint. I am one of those who believe that future Chancellors of the Exchequer will have to make larger demands upon the income and accumulations of the well-to-do classes. I believe that we can not go on for long regarding a Budget as simply making provisions for the national services for a particular year. I do not think it possible in these times to place any one financial year in a watertight compartment. Future Chancellors of the Exchequer, in my opinion, will have to have regard to great national interests. You will have to see that there are only two ways of raising national funds, either by taxation or by embarking in great enterprises, and in our opinion, future Chancellors of the Exchequer will have to make provision, not only for carrying on the Army and the Navy and the Civil Service, but also for developing our country. I am glad to observe that it is intended to try—I do not know how far it will succeed—to tax foreign investments. For my own part I recognise that capital will flow to that quarter of the Globe, irrespective of country, where it is likely to realise the highest amount of interest. It is often alleged that capital knows no country. That is a positive truism. On the other hand, I feel that we are entitled to think that our own country needs capital, and that if capital goes to other parts of the world, then it ought to bear some liability for it. I find that Sir George Paish stated that in 1913 there were £3,715,000,000 of capital belonging to this country, or, at any rate, to classes in this country, invested in other countries, in about equal parts in the Empire and in foreign countries.
Undoubtedly there is need for capital expenditure in our own country, and therefore I believe that in subsequent Budgets provision will have to be made for great State schemes. That, of course, recalls to us that some other countries have not to rely altogether on taxation for financing State needs. Germany is often held up to us as an example. I believe that Germany realises some £50,000,000 a year on State enterprises, which to that extent relieve the taxpayers of that country. What would happen if they had to raise the whole of their expenditure in taxes I do not know. I read yesterday, in a Conservative paper, that there is a great rush on the part of wealthy Germans to put the money into Swiss banks. They have created a demand for greater expenditure on armament, and now, when it is being incurred, they desire to evade their fair share of responsibility in respect of it. We were told in this Paper that during the last six months German investors have put some £40,000,000 or £50,000,000 into the custody of these Swiss banks. Therefore we see that our problems are not peculiar to us, but they are also shared by other countries. When the people here complain of the increase of taxation, and that we are driving capital out of the country, we wonder whatever part of the world it is going to. I will not pursue that any further than to give one or two illustrations. The Prussian railways are the property of the State, which realises an annual profit from the working of those railways. The railways are constantly being reduced in respect of the amount of capital in the State books. In the course of time those railways will be the unfettered property of the State, bringing in a large annual revenue. In this country on the other hand, the capital value of our railways never diminishes in amount. The interest has to be paid year by year in respect of capital which has altogether ceased to exist. This constitutes a great drain on industry, as the railway companies profess inability to pay good wages or conform to reasonable conditions of labour, and it altogether suggests to us that the conditions prevalent in this country are not so good or desirable as those in respect of which I have given an illustration, namely, the Prussian railways.
We on these benches believe that it is in that direction future Governments will have to go in order to provide the necessary finance for State purposes, and that is one of the proposals we respectfully indicate in the Amendment that we have placed on the Paper, but which, under existing conditions, I am afraid we will not have an opportunity to move. I want to enforce, in conclusion, this fact, that we do most strongly resent the reduction that has been made in the proposed rate of Income Tax. We feel that the Government ought to have fulfilled its pledges to the people of this country, and have remitted a corresponding amount on food taxes. We are certain that their attitude in this matter will cause great misunderstanding and intense dissatisfaction in the country. All parties must recognise that the great mass of the people are following these questions with keener interest today than at any previous stage in the history of our country. The great mass of the people are familiar with the facts of riches and poverty. It is no good your trying to delude them into the belief that there is necessity to retain those taxes on food which press so heavily on the poorer members of the community. They know that there is wealth on which you can levy, and they will not tolerate the retention of these taxes which are so unfair in their incidence, and so harsh to the poor of the community. We feel that the Government—or those who have prevailed in the Government—have wrought more injury to their party than any other opposition from the hon. Gentlemen opposite, or even from anything that we can do on these benches. It is that sort of action which compels workers to believe that they cannot rely upon the Liberal party. [HON. MEMBERS: "Hear, hear!"] It is quite true—and my hon. Friend will bear me out that I am not accustomed to making exaggerated statements—that when the working men read this morning that the Government had the opportunity of reducing the food taxes but preferred to give relief to the wealthy interests, they were disappointed, and I feel I am perfectly justified in saying, on behalf of the class to which I belong, that the Government has not acted rightly in the light of the promises which they have made to them, and that we are bound from these benches to make our protest in the form in which I have submitted it to the House.
The hon. Member does not appear to have a very high opinion of the Government that he supports, for he tells us that they have capitulated to a small number of their supporters, who, he suggests, have not been actuated by high constitutional principles, but by motives which must be described as selfish. The hon. Member began his speech by saying that he was in sympathy with my right hon. Friend the Member for Fulham, but he found reasons why he should not vote in favour of the Amendment. We are accustomed to every excuse from the Labour Benches for not voting against the Government, and the reason given by the hon. Member for not voting in support of the Amendment of my right hon. Friend seems to me even more flimsy than usual. He said he could not vote for it because he was in favour of rating land value. But there is nothing in the Amendment which rejects or takes exception to that proposal. The last words of the Amendment to which the hon. Member takes objection regrets that "no provision should be made in the current financial year for that purpose, and that any provision to be made in a future year should be made conditional on setting up a new system of valuation for rating purposes under the control of the Land Valuation Department, and subject to conditions destructive of local autonomy." The hon. Member, in the course of his speech, I gathered, said he thought it impossible to make Grants to local authorities dependent upon those complicated arrangements; therefore I cannot see what his reason is for not supporting the Amendment of my right hon. Friend.
The Secretary for Scotland earlier in the afternoon seemed to think that the local authority had no reason to be disappointed with the action of the Government. The fact remains that the local authority are not going to receive this year Grants which they were led to believe they would receive. In the next place—and this is a very important grievance—their chance of getting new Grants next year, or in future years, has been seriously, and is seriously, imperilled by the complications which the Government have introduced. I do venture to make my protest against the unjustifiable complications which the Government introduced in Clause 13 of the Finance Bill, and into the question of the distribution of Grants. The task of distributing the Grants equitably amongst the various local authorities is one of considerable difficulty, and will give rise to difference of opinion not necessarily on party lines. But in discharging that task, the House, at any rate, has before it the definite information and recommendation of expert authority. The Government, however, have gone out of their way to mix up with this difficult question a proposal which has no expert authority behind it, and which ought not to be adopted in a casual way by this Bill, or until it has been placed before the House in a clear and definite form. The Government are really seeking to sell a pig in a poke. They are asking the House to pass in principle a proposal which is to come on next Session. Who knows what will be the occupations or pre-occupations of next Session? What is the proposal which, as far as we can gather it, the Government are putting forward. It is, in the first place, to make the new Grants absolutely contingent upon Parliament making provision for dividing rateable value into two parts—the value attributable to the buildings without the land and the value attributable to the land without the buildings. The idea of dividing rateable value into land value and building value is a very old one, but I thought it was exploded twenty years ago. It certainly has been discarded by high Liberal and progressive authority, and it was rejected by the Royal Commission, both Majority and Minority, before whom it was submitted by Mr. Fletcher Moulton, now Lord Moulton. I will venture to quote a passage from the Report by the late Mr. Costelloe one of the most able advocates of the taxation of land values, who gave evidence before the Royal Commission on behalf of the London County Council, and whose reports are really classics on the subject. This passage I quote because it seems so peculiarly apposite to the present proposal. Mr. Costelloe had been urging that a special column should be set up in the rate book for site values, and he went on as follows:— the site, even than valuing the site supposed to be without its building. The Royal Commission pointed out the great difficulty of doing that. I think the Government would be wise if they proceeded on the principle that castles in the air may be built, but that they cannot be conveniently valued for rating purposes. The Government are doing precisely what Mr. Costelloe said could not be properly done, namely, treating rateable value as a composite thing composed of so much building value and so much land value. How do the Government propose to divide that? I suppose the value attributable to the land will be the site value under the Finance Act, 1909–10, and the difference between the site value and the rateable value will be attributed to buildings under the Government scheme. But it will not be the actual value of the buildings, for a very simple reason. In the passage I have quoted it was pointed out that you cannot get a correct rateable value of a tenement by taking the total obtained, by adding the figure of the bare value of the land to another independent estimate of the existing buildings, and so, in the same way, you cannot value the existing buildings by taking the bare value of the land from the rateable value. The reason is very simple. The site value, which the Government is taking, is the potential or capital value, but the element of land value, included in rateable value, is the value in actual use, and therefore the Government cannot arrive at a correct value of the buildings by the method which they apparently contemplate. I think they would have done well to have taken the advice of the Minority of the Royal Commission, because they say:— forward to satisfy a section of the Government's supporters, and we are asked to accept it on trust, and the matter is not placed before us, except in the merest outline. As the whole question of Government Grants is to be made dependent on this condition, I desire to go a little deeper into the subject. What is the case for the proposal put forward by the Government. Suppose the policy which they contemplate is accomplished, and that the value to be attributed to buildings has been correctly ascertained, why is the relief which is to be afforded by these Grants to be given first to rates on buildings? The Chancellor of the Exchequer has stated, that in his opinion, the Report of the Minority of the Royal Commission was the most powerful and convincing of State Papers, but he cannot find support for this proposal in that Report. On the contrary, it is inconsistent with the whole argument of the Minority Report. The Minority thought that if the Government increased the Grants to local authorities, as they recommended, that that increase might be accompanied with what they called a make-weight in the shape of an owner's site value rate. They made that recommendation on the assumption and on the express ground that owners of site values would benefit by the increased Grants. The two things were to balance each other, as it were. But the Government are proposing both to establish a site-value rate, the make-weight of the Minority, and also to provide that none of the relief from any Grants is to go to the owners in respect of rates on site values. They have therefore discarded the doctrine of the makeweight, and abandoned the basis upon which the Minority recommended a site-value rate. Is there a case—a primâ facie case, at any rate—for the Government proposals? These Grants are to be made in respect of semi-national services. It has been found by high expert authority that there is now falling on the rates a charge for these services which ought to be falling on the National Exchequer. If the National Exchequer is shouldering the burden and lifting it off the rates, why are not all those who bear a share of the burden to receive a share of the relief? I could understand this proposal if the contention was that owners did not bear any substantial share of the burden of the rates. That contention was declared by the Minority of the Royal Commission to be a popular misconception of our existing system of taxation. The Land Values Group of Members of Parliament, in the Memorandum which they submitted to the Departmental Committee, expressly say:—
I cannot help thinking that what the Government are proposing to do by this Bill is to give effect to a theory of taxation which its advocates have not been able to induce the Departmental Committee to adopt. That theory is described as "single," and, I think, is certainly singular. They argued before the Departmental Committee that Grants-in-Aid are a present to landowners, and they said that they had a wonderful scheme by which landowners might be made to feed, as it were, on themselves. They said that their proposal was that the burden of the rates should be made to fall either directly or indirectly upon the owners of site values, and that owners of site values should find relief from the rate burden by a national levy on land values raised from themselves—a process which I can only describe as feeding upon themselves. The proposal seems so monstrous and unfair, that one might almost think it an effort of sardonic humour. The justification for it put forward before the Departmental Committee is that land values are a public fund, which may properly be appropriated by the Government and devoted to public purposes, even though it may ruin those who have acquired the site values with the sanction of the Government, and may have even bought them from the Government themselves. That proposal received no support from the Departmental Committee; but the Government, as it seems to me, are really giving effect to it by Clause 13 of the Finance Bill. I cannot see any other reason for discriminating between the two classes of rates. The cost, as I understand, of semi-national services is to fall on both classes of rates, but the contributions in aid of them are only to go to one. Either the Government are not going to pay their proper share of contribution, in which case personalty will benefit as compared with realty, or else some of the rates are going to get a greater share of relief than is properly due to them.
I am not dealing with the question of the better distribution of local taxation, that is, of the taxation which must be levied on the locality. Any proposals with that object must receive careful consideration. What I cannot see is on what principle, except that of the single-taxers. Grants are to be given otherwise than in aid of all rates which provide the revenue. The Government are really paying a debt, why are not all those who find the money in the first instance to share in the repayment? This is a complicated matter, and I am afraid that what I have said is somewhat intricate and dull. But I think it necessary to put these matters forward, because the Government ought to give careful consideration to the question whether they really feel bound to adhere to the condition attached to Government Grants in Clause 13, which I think must have the effect, as an hon. Member opposite said, of delaying these Grants probably for several years. Certainly it seems to me unjustifiable to attach such a questionable condition as that which I have been discussing. The Government can perfectly well deal with the question in a future Session if they think it is a sound proposal that they are making. But certainly they are not taking a right course in doing what is very likely to postpone the Grants which local authorities have been expecting for so many years.
The Debate to which we have to-day listened has gone, not so much on the subject of the Finance Bill, as on the more remote subject of the future Rating Bill and the Valuation Bill. We have heard many interesting speeches from the other side of the House endeavouring, with more or less success, to demonstrate that it is perfectly impossible to separate the site value from the composite value of the hereditament, and, secondly, that the rating of site values is in itself inherently unsound. The hon. Member for Chelmsford (Mr. Pretyman), who made a very animated speech on the subject, challenged this side of the House with the extraordinary statement that neither the Liberal party nor the Liberal Government were in any way committed to the principle of the rating of site values. I would like, therefore, to read a quotation from a speech on this very subject made by the present Prime Minister as long ago as the 14th October, 1898. The Prime Minister said:— has for years been asking for this reform to be undertaken. There are few Members opposite who have not agreed from time to time with such proposals; but, of course, when the time comes for the proposals to be carried out, many difficulties of a practical nature arise. It seems to be a curious fact that the hon. and gallant Member for Chelmsford, and the group with which he is associated, when they have pointed out the difficulties, think that they have disposed of the matter.
Valuation is a difficult matter in all countries where you have had land valuation. It has taken many years to get the system to operate easily and equitably. We shall form no exception to that rule. But to say that because in the first instance you meet with difficulties, natural difficulties, and legal difficulties, to the carrying out of a great reform, that therefore that reform has to be abandoned, or thrown away, seems to me to be arguing in a very shortsighted kind of way. The hon. and gallant Member for Chelmsford went on to say that he did not care what economists might urge, that he preferred the opinion of two butchers as to what the rating system of this country should be. If you are to carry on the system of rating in this country, practically on the opinion of butchers in disregard to the opinion of the economists, well and good, but it does not seem reasonable. The hon. and learned Member for West St. Pancras desires to follow a more simple method instead of a great change in the rating system. Such, perhaps, would meet with the approval of butchers and other people to whom a profound study of the subject is most arduous and difficult, but in reality the subject is not so difficult as those clouds of controversial dust that are thrown out about it seem to suggest. The indignation shown by hon. Members opposite about the difficulties about showing what improvements have taken place in the last fifty years, and of the terrible penalty of £50 which the hon. and gallant Member may know would never be inflicted, never be imposed, or asked for—is a little unworthy, I think, either of the subject he was discussing, or of his own position in the discussion.
After all, why is this whole question of improvements introduced into the Revenue Bill? It is introduced undoubtedly for the protection of the owner of the land. If the owner prefers not to take the trouble to give the particulars of these, neither the rate nor the tax collector will have the slightest objection to valuing the land with all the improvements on it, and making no deductions whatever. I have noticed all through this controversy, just as in 1909, that hon. Members opposite with great ingenuity bring forward arguments of all kinds as to the deductions that ought, in fairness to the owner of the land, to be made in order to arrive at the true site value. Whenever, in order to meet those views, we endeavour to make those deductions, they state that it only complicates the valuation. The hon. Member for Chelmsford gets up and jeers at us for these deductions on the valuation. I think it very unfair proceedings. The complication that exists in the valuation has been introduced to meet the Amendments of hon. Members opposite. So far as we are concerned we think a great deal too many deductions have been made. The valuation would have been a better one if it had been more simple, and perhaps a little more unfair, and not so theoretical as it is. Hon. Members opposite have put forward the objection of the difficulty of getting the information as to what was done to the land, as to what land they owned, as to what improvements have been made, and so on. Surely it is not unreasonable for those who own the land, and who are supposed to know about it, and who are able to furnish the particulars as required, to do so, as has been done in other countries! It is perfectly unreasonable, on the other hand, to complain of complications introduced by yourselves. I am glad to say a little daylight has come into the mind of the hon. and gallant Member for Chelmsford. He has at least admitted that it is a bad thing to rate or tax improvements. We are grateful for that admission. It is encouraging to us who have been preaching this doctrine for many years, and have been denounced as theorists in consequence, to find at last that the idea is gaining some ground. I was very interested to hear other of the hon. and gallant Member's denunciations. Land taxers have always said, and the economists have always supported them, that the only tax which does not discourage anybody is a tax on land, for the obvious reason that the land of the country, not having been made by any human being, and not being able either to be increased or diminished by any human being, is neither encouraged nor discouraged by taxing. The hon. Members opposite seem to think that that is a novel doctrine. Let them look at Professor Marshall, Professor Fawcett, and others. They will find what I am putting in more popular language. Professor Marshall, in his "Principles of Economics," says:— seems to me that hon. Members opposite are like people in a restaurant, clamouring for more expensive courses than others, and then complaining very bitterly when the bill is presented for payment.
If any of us consider the expenditure of this country we will find that it is going up at a very great rate. I myself feel we are spending too much money, not upon social reform, but in another connection, and not merely that we are spending too much money in the sense of maintaining certain services, but we are not getting the highest and the fullest value. I, and other hon. Members like me on the Estimates Committee, are coming slowing to the conviction that we ought to be able to maintain the defences required for this country at a lower rate of expenditure than we are maintaining them at the present day. I think in this House, if greater attention was given to the expenditure on individual items, and if there was a lesser demand for increasing Estimates, a good deal would be done to obtain real economy in the services of the country. There is just one other point that I would like to touch upon in connection with some remarks that fell from the President of the Local Government Board yesterday. He explained to the Committee what seemed to me a most monstrous proposition. One of his propositions was, that in his opinion personalty should contribute more to local rates. I confess that seems to me to be an extraordinary doctrine to come from a Liberal statesman on a Front Bench. It is contrary to the traditions of the Liberal party. I find the subject is one that has given rise to controversy as to whether local taxation should be borne by real property in the localities. That is the principle on which local taxation has been raised in this country for a great many centuries, and I think very properly, for there is no class of property that benefits more from the expenditure of the municipality than the real property in the locality.
The right hon. Gentleman may not be aware that rates were originally imposed upon realty and personalty, and that personalty escaped.
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I am perfectly aware of that fact that the rate on personalty was never levied, and, therefore, I think that my recollection is fairly accurate that for all the centuries it was borne upon realty, but I am not going back to the remote past for a system of local taxation, but to the system that is in vogue in more modern days. What I am pointing out is, that, on the whole, real estate in a locality is benefited more by the expenditure of municipal money than any other class of property. I cannot understand the argument frequently put that a man earning a considerable income in a locality, say a doctor or a lawyer, should have his success attributed to the rates. He is no more benefited by the expenditure of the rates than any other citizen, and the income a consultant derives in Harley Street is not derived through the greater expenditure of the municipality, but is due to his greater ability, and he could carry on the same business in another district. I therefore demur very strongly to the general proposition that personal property ought to pay more towards local taxation. I should like to read a very interesting quotation from Mr. Cobden, in 1849, in reference to this very question. He said, referring to the question why the whole of the local taxation should be laid upon real property:— in 1884–5 the amount said to be contributed to the local authorities was £3,600,000. In 1908–9 that amounted to £21,000,000, nearly seven times the amount. The rates increased certainly in that time from £54,000,000 to £140,000,000, about three times as much, so that while the Exchequer contribution increased seven times as much, the rates increased only three times as much. On the other hand, the proportion of the Exchequer contribution in 1884–5 was 12 per cent., and in 1908–9 25 per cent., nearly twice as much. I merely cite these figures to point that we have enormously increased in a comparatively short period the amount of the Exchequer contributions to the local authorities, and that therefore it seems to me to be a doubtful policy to increase them to any very great extent. We have heard a great deal about the penny on the Income Tax. You might just as well argue that the Sugar Duties are being used in relief of local rates. You cannot ear-mark any particular tax or part of a tax until you have dealt with your whole system of taxation. A good many of us feel that the abolition of the Sugar Tax would be very much preferable and more useful to the people of the country at large than a reduction of rates which unless given under circumstances which the Government are providing for must inevitably become merely a gift to the owners of real property in this country. Therefore I am pleased that the Government have given up the idea of these temporary Grants, which might become permanent Grants, and all we should be doing would be to carry on the old policy of the Agricultural Rates Act when it was first introduced.
I notice a great deal of zeal amongst hon. Members opposite in begging for these temporary Grants. No doubt they feel that if these Grants are once introduced, whatever happens, they could not be withdrawn. Once this money went even temporarily to the local authorities, whether the Valuation Bill was passed or not, it would be impossible for any Government to withdraw these Grants, and the Liberal party would be led into the illogical and fantastic position of instituting a policy in relief of local rates which was unanimously condemned when it was introduced by hon. Gentlemen opposite. I congratulate the right hon. Gentleman upon taking a step to avoid this danger, and making sure when these Grants come into operation they shall not merely enhance the value or land in this country. Whatever hon. Members opposite may think of the Land Taxes, they must agree that it is extremely unfair to tax other people in order to make a present to the owners of the land, particularly when a large amount of this taxation is going to be paid by those whose incomes are comparatively small.
One of the blots on the Finance Bill is that the new Super-tax arrangement deals with unearned incomes of £5,000 or £10,000 with the same force as earned incomes of that amount. I should think any man would feel that a person in receipt of £5,000 or £10,000 a year, and having to lay by a considerable portion of his income in order to provide capital for his old age, or his family, is not in the same position as a man with £5,000 or £10,000 a year derived from investments, and I do not think it is fair that he should have to pay the same Super-tax. I hope when we get into Committee on the Finance Bill we may be able to get some modification of this proposal. I do feel that no one can fairly ask for Grants simply to enhance the capital value of land, and that is what we should be doing if we were merely going to hand these Grants over to local authorities without any reform in our rating system. That reform may be very difficult, but it is very necessary and essential, and it has produced good results in other countries. Mr. Lawson Purdy, the President of the Department of Taxes in the City of New York, in his report, says:—
I want to say that I shall vote for the Amendment moved by the right hon. Gentleman the Member for Fulham (Mr. Hayes Fisher) as a protest against what I believe to be a breach of faith on the part of the Chancellor of the Exchequer in failing to fulfil the promise that he made to give relief to local authorities during the present year. In reply to the Amendment which I moved on the Address, the right hon. Gentleman said that he recognised the intolerable burden of the increased pressure of the rates, and he said that he intended during the present Session to give relief. I would like to read the right hon. Gentleman's words:— tural land and the buildings and the improvements on the land should stand on one basis and that there should not be this ridiculous division. We should thus have avoided all this delay in deciding how the Grant should be allocated to the local bodies, and the right hon. Gentleman would have been able, and I am sure that he would have been glad to be able, to fulfil his promise to the House to the local authorities made in the early part of the Session. I want to warn the right hon. Gentleman against the mistrust he is showing of local bodies in making provisions dealing with these Grants to them. I would remind the right hon. Gentleman that in the speech to which I have alluded he referred to local administration in the following words:— requirements of the district as men used to the county and the district have.
With reference to the classification of roads, it cannot be a true indication of the amount to which each class of roads is entitled, because while there may be a larger amount of traffic on one class of road than on another, it may be that the cost of maintenance is very much greater on the road little used because of its indifferent foundations. It may be that that road is on a clay bottom and will cost twice as much to repair. Thus, it will be seen that the information which the Road Board seek to obtain is of very little value indeed. But it is a matter of great annoyance to the county councils who are devoting themselves to this work. They are anxious to bring the roads of the county into the best possible condition, and to be hindered in their work, arduous as it is, by having to get all these fanciful details for the information of the Road Board is very annoying. I venture to say that if the money which has been handed to the Road Board had been divided among the county councils much better work would have resulted, and a good deal of friction would have been avoided. Therefore, I will venture to appeal to the right hon. Gentleman that in any conditions he attaches to regulate the use of these Grants of money to local bodies, there shall be none of a pin-pricking character—none of a character which would incline men and women engaged in local work to give it up, rather than be overruled by paid officials sent down from London, who have no real knowledge of the requirements of the district. The right hon. Gentleman values the local work of these people. If irritating curtailments and directions are issued to these bodies by paid officials, the best men among them will cease to devote their time to the work rather than be overruled by men who cannot have sufficient knowledge of the matters with which they deal.
With reference to the Agricultural Rates Act, the President of the Local Government Board informed us yesterday that the Grant in lieu of one-half the rates on agricultural land will continue to be paid this year. In any future settlement it should be remembered that the sums paid to local bodies under that Act do not amount to anything like one-half the rates on agricultural land, and that local bodies lose sums annually nearly equal in amount to the Grant made by the Treasury in lieu of agricultural rates. I ask the right hon. Gentleman in his final arrangement—I hope even yet he will fulfil his promise, although I am afraid it will not be for some long time, I am sure he will do his best to fulfil his word—to remember, in estimating the amount of the Grants to be handed to local bodies, that the Grant hitherto paid to them in lieu of the agricultural rates has only been one-half what it should be.
The right hon. Gentleman who has just sat down, gave us a long treatise on the desirability of personalty not being taxed. No one on this side of the House wants to treat unfairly the owners of personal property. The right hon. Gentleman contended that agriculturists should not be treated better than traders, because agriculture has the benefit of the Agricultural Rates Act. The gate hangs on the other post. Traders, such as the right hon. Gentleman and others, and millionaires who have made their fortunes in trade, are under the law of the land liable to pay rates on their stock-in-trade, but annually this House passes a Bill suspending that liability. If we omitted to do that in any one year, three months afterwards all traders and manufacturers would have to pay rates on their stock-in-trade. I always vote for the remission of those rates, because I want to see all our industries left unpenalised as well as farming. The Agricultural Rates Act affords relief to agriculturalists from a burden, and merely suspends a liability, and owners of personal property have no right to complain of it. The right hon. Gentleman asked why a man living in a rural district, who has a good deal of personal property should contribute towards the upkeep of roads, police, and sanitary arrangements. May I give an instance showing the present injustice? The occupier of a manor house may be receiving £4,000 a year from investments. His house is rated at £100 a year. The occupier of the manor farm whose income is perhaps £150 a year, and who pays a rental of £250, is rated at £200 a year. He is paying twice as muck as the owner of the personal property who lives in the manor house, and who, perhaps, derives his money from foreign countries. That is a monstrous injustice.
All that we ask is that he should contribute to the upkeep of the country. The right hon. Gentleman says that if you relieve the burden on the land, you benefit the landlord exclusively. I know that theory was advanced when the Agricultural Rates Act was passed. First, it was said it was a dole to the landlords. Statistics showed immediately that the rents of this country went down £7,000,000 a year after the Act was passed. Then it was said it was unfair to the agricultural labourer. It is a singular thing that notwithstanding the depression that existed then, directly there was that remission of rates wages went up to the extent of £2,500,000 in three years. It shows, I think, that the removal of any unjust burden from the agricultural classes tends to the increased output of the home food supply, and to do something towards what we all want to see, more people living and prospering in the rural districts, and thereby benefiting the community as a whole. I appeal to the right hon. Gentleman to fulfil his promise as soon as he possibly can, and when he fulfils it I hope he will not enact such pin-pricking conditions as will lessen the interest of men and women who are working to administer the services of this country. The burden has become so intolerable, and they have to make such heavy demands on ratepayers that the work has become distasteful. I hope when relief to local rating comes it will be substantial and administered in a way not like the fussiness the Road Board is showing, but in a way that is reasonable and businesslike.
I do not for a moment doubt the sincerity of the hon. Member in regard to his desire that further assistance should be given to authorities in the country with a view to relieving local rates, but at the same time it seems to me somewhat curious that those hon. Members opposite who are very anxious that this relief should be given should take the very first opportunity they can of resisting our proposals, whereby alone that kind of relief which we ask for can be and will be given to those who so much require it among the authorities in this country. There has not been much discussion so far in this Debate in regard to the £3,900,000 which the Chancellor of the Exchequer referred to when he made his opening proposals in regard to this Budget, but I think it is only fair and right that hon. Members and the country should before the Second Reading of this Bill is put from the Chair, have an opportunity of realising our proposals as to the way in which that particular portion of the relief to ratepayers and to local education authorities might be allocated. But before I deal with the allocation I may be permitted to deal with a point which was raised yesterday by a question put to myself and in a speech of the hon. Member (Mr. G. Roberts) this evening. There seems to be in certain quarters in the country great apprehension that the Government propose to abolish the right that parents have possessed since 1891 to secure free education for their children if they so desire. The reason for that apprehension is a very simple one. The Act of 1891, so far as unrepealed, is repealed by the Schedule to the Finance Act. Hon. Members have consequently jumped to the conclusion that therefore free education has disappeared. It is perfectly true that the Act of 1891 gave free education in Section 5, but that Section was repealed by the Act of 1902, and we have to go to the Act of 1902 in order to preserve the right of parents to secure for their children free education, if they so desire it, in the elementary schools of the country. By paragraph 5 of the third Schedule of the Education Act of 1902, it was enacted:—
"The duty of a local education authority under the Education Acts, 1870 to 1902, to provide a sufficient amount of public school accommodation shall include the duty to provide a sufficient amount of public school accommodation without payment of fees in every part of their area."
We are not repealing that Section. That will stand good after the passage of the Finance Bill, and all that is done in regard to affecting the power of parents to secure free education for their children will be that after the passage of the Finance Bill, instead of the Government being obliged to resort to the almost useless procedure of a mandamus to compel a reluctant authority to enforce the free system of education in elementary schools for parents who desire it for their children, we shall in future, as an alternative procedure, be able to do it by making a deduction from their Grant. But our regulations and practice, the law and the desire among local education authorities to give adequate free education in all their areas, are such as to make it, I hope, not necessary even to look forward to any deduction being made from any local authority in future with a view to placing that pressure upon them. I am quite sure that there is no danger in the future, and that this House will regard with a jealous eye the rights of parents who desire it to secure free education for their children in the elementary schools of the country.
The success of a nation, I think, undoubtedly depends upon the extent to which the population has been educated and trained. I believe our education authorities are alive to the needs of the country, and are alive to the great competition which we, as a country, have to face in connection with Germany, America, and other civilised countries in the world. But the difficulty which education authorities have to deal with is that the ratepayers' pressure has been such as to make it almost impossible for them to go forward with that amount of progressive educational work which they were anxious themselves to carry out. Ratepayers' protection associations have had a restraining influence over the education committees, and Parliament has not been able to compel authorities in regard to many of the higher branches of education, which are essential in the interest of the people, if we are to develop the best talent in the country for the good of the country. I have had instance after instance during the last few years of local authorities who have had to refuse all kinds of education. Sometimes a large number of students who desire to attend technical classes are turned away from the door, and the authorities say that they are not prepared to spend any further money for establishing technical classes. Some authorities have thought it unnecessary to establish secondary schools; other authorities pass by-laws which tend to restrict the age and to encourage children to leave school at an early age. The real way to meet all these matters is, of course, by giving more State aid to the local authorities.
The way in which that State aid should be given has been the subject matter of consideration by the Kempe Committee for a long time. They came to the conclusion, not hurriedly, but after a great deal of evidence, not to rush this question unduly before the country. We recognise that retrenchment in expenditure is essential, but I am one of those who, whilst I should like to see a great reduction of the money spent on our armaments, believe that money can be spent to the advantage of the State, and well spent in the interests of the nation in promoting education in a variety of directions. If we are to secure the best results for our country it is essential that our population should be properly trained and equipped. For this purpose it is necessary that the children, even before they go to school, should be properly looked after and fed, either at home or in crêches or in nursery schools, and properly trained in those institutions, and so on up to the infant department, and through the elementary schools. If we are to get the best we can out of the nation we must spend very large sums of money in the future. The Chancellor of the Exchequer alluded to the £3,900,000 as a sum which we hoped to secure for the educational branch of our work in 1915–16, and in the White Paper which was circulated, £1,000,000 of this was described as being for new educational services. It would be more accurately described as money not necessarily going to the relief of local rates. Some of that money will go to help the blind, the deaf, and the defective, and for the provision of meals and the services already existing. Therefore it is not quite accurate to say that that £1,000,000 will be devoted entirely to new services in the immediate future. I believe that some proportion of it, at any rate, will go in relief of rates, but we expect that about £1,000,000 of that £3,900,000 will, before very long, be absorbed in connection with educational progress. The Chancellor of the Exchequer alluded to the fact that £560,000 will be distributed for higher education. That £560,000 has not yet been precisely allocated, and the figures which I now give are provisional, and subject to modification and adjustment and regulations which are not yet prepared; but our idea at the Board of Education is that of that £560,000 which will be devoted next year as additional money for higher education, £395,000 ought to go to assistance of secondary education, £100,000 to technical education, and £65,000 in connection with additional provision for the training of teachers, and to start a pension scheme for teachers in secondary and technical schools.
Is there a local contribution from the rates for all these services?
Some of the education authorities have very limited powers for rating themselves, but they all rate themselves to some extent.
Can the right hon. Gentleman give some figures as to the local rating?
No, I am afraid I cannot, but if the hon. and learned Member desires to put a question down I shall be glad to give him any information in my power. In connection with university education, we look to increase the expenditure upon it by about £150,000 before very long. No doubt a large portion of that expenditure will depend on the success which may result from the negotiations which are now going on for the reorganisation of a University in London. Undoubtedly the State will have to come to the assistance of London in the event of a new London University being created, and a portion of the sum will be allocated to that object.
Is there a local rate for that?
No, Sir; there is no general local rate for university education. There are very large public endowments, and that subject, of course, is quite apart from the other branches with which I am concerned. I, myself, am not responsible for the universities in the same way as I am for elementary and secondary education. As to the provision of meals, we propose this year, for the first time, to give £77,000 to help the authorities with their work in providing meals for children attending our elementary schools. In the following year we anticipate that the sum will have been increased to £150,000. The sum of £27,000 will be required in connection with new moneys for special schools, and blind, and physically and mentally defective schools; and £55,000 will be devoted to the epidemic Grant. A very long-standing grievance has been felt by the education authorities ever since the epidemic Grant, then amounting to £57,000, was stopped in the year 1903. But owing to the additional Grant which will be given in the form of a block Grant, we do not propose to distribute it in the way the other epidemic Grant was distributed, but to distribute the money among those authorities who are really doing the most work for carrying out a complete and scientific method of dealing with epidemics when they arise. We are putting on one side £50,000 for health work, which I believe will be among the best spent money that can possibly be given by the State. There is a vast amount of work to be done for young children in the country, not only in regard to nursery schools, but crèches, schools for mothers, clinics, infant dispensaries, infant treatment, infant consultations—which are being carried on by voluntary committees, care committees, education authorities, and sanitary authorities. Some will be under the care of sanitary authorities and medical officers of health, some under school medical officers, and some under nurses who are appointed by one authority, some by another, and some by voluntary associations. We propose that all this work shall be organised, and that the Local Government Board and the Board of Education shall co-operate. We hope that the education authorities and health authorities in the country may also co-operate, so that there shall be no unnecessary friction between those various bodies. Be believe that it is possible to unite all agencies in connection with this work and that the sum of £50,000 will do a great deal to improve the physique and the health of the children before they come to the schools of the country.
I come to the question of the block Grant for elementary education, which will include £2,750,000 new money. That block Grant will go directly in relief of rates, and will take the place of all the existing Grants which are cumbrous and complicated, and do not discriminate between rich areas and poor areas, and which are distributed in a way in which they often bring no more, and sometimes less, to progressive authorities who spend liberally than to authorities who restrict themselves to the bare minimum of provision for elementary schools and the elementary education given in those schools. The new Consolidated Grant meets all those objections. It is a single Grant to every area, although it is reckoned in the form of a Primary and Supplementary Grant. The hon. Member who last spoke alluded to the fact that we did not place much confidence in the local authorities hitherto. I agree we have given some money for cookery and some for handicraft, and some for necessitous areas and some for small populations, and we have divided our main Education Grant into an Annual Grant, an Aid Grant, and a Fee Grant. There will be no interference in petty ways with education authorities. We believe they can be trusted, and by consolidating those Grants we shall be able to work with far more harmony in future than has been the practice in some bygone years.
And more economy?
I believe there will be greater economy, even though more money is being spent. I believe it is true economy to spend money on education.
Will the right hon. Gentleman explain the Block Grant?
I ought to explain that this block Grant is a scheme which has been very carefully thought out by the Kempe Committee, and is taken wholeheartedly in its entirety by us. I must say I thought I had found a better system, but when I came to work out the best proposals we were able to make in connection with any other scheme, I found they required even more patching than that of the Kempe Committee's recommendations. I think that the Kempe Committee's Report may be placed before the House on the ground that every argument which can be used against their recommendation would apply with much greater effect to any other proposal, while I believe to every argument that has hitherto been raised against this particular block Grant there is an effective reply. I may say that the Grant is so contrived that every authority, whatever its assessable value, will have at its disposal a sum equivalent to 60s. per child throughout its whole area, provided it raises an educational rate of 7d. The Primary Grant amounts to £10,335,000 and the Supplementary Grant to £3,205,000. The primary Grant will equalise the rates, and the Supplementary Grant will represent two-fifths of an authority's expenditure in excess of 60s. The average percentage of the expenditure that will be met by the State will be 56. The maximum, percentage permitted will be two-thirds of the expenditure incurred by a locality. Any amendment fixing the proportion of the expenditure borne by the State would fail to take into account the difference in the ability of various authorities to pay. Let me give one illustration. Walsall and Bradford are two large industrial towns with some what similar populations. In Walsall, a penny rate produces £908, in Bradford £6,000. Therefore, if any attempt were made to secure in each case the payment of a similar proportion by the State, it would be obviously very unfair to Walsall with its small rateable value, and very generous to Bradford with its larger rateable value. The present formula meets the present necessities and provides for some expansion. It may have to be altered in the event of changes taking place; but I believe that the scheme as suggested will meet the present situation, and for some years to come. Some individuals say that the State ought to give at least 50 per cent. of the expenditure in every area. That again would be unfair. For instance, Wimbledon now has a rate of 10.8d., and if given 50 per cent. would receive £15,144, and the rate would be reduced to below 8d. Out of the limited sum available it would mean that £689,000 would be given to relieve forty-three authorities whose rate burdens are already considerably below the average. The scheme has not been worked out for each place; it is being worked out, and I hope that in a few days I shall be able to give accurate figures in regard to what each local authority will get.
Will the return include the local contribution as well?
I cannot say off-hand.
Will any authority receive less under the proposed Grant than it receives now?
No. All authorities which receive an increased necessitous areas Grant will have that sum placed to their credit; so that the authorities will receive for the year 1915–16 not less than they are receiving at the present time, plus the additional necessitous areas Grant. There is just one other matter—it is urged that contributions should be paid direct for teachers' salaries in some form or other. The total salaries now amount to £16,000,000. The total block Grant is £13,540,000. It would therefore be impossible to pay the whole of the salaries. As to paying a proportion, I have my objections because I am quite satisfied myself that the better system is to leave the education authorities to appoint their own teachers and to fix their own salaries. They know their own local circumstances far better than any Central Department of Government. The cost of living varies, the attractions of localities vary, and the local requirements vary. The whole question of the payment of teachers and the staffing of the schools had, to a large extent, better be left to the discretion of the local education authorities.
As to the illustration the right hon. Gentleman gave just now, did he not mislead himself? He stated that Bradford and Walsall were comparable as to population. I see that the population of Bradford is 240,000, while that of Walsall is much less. I do not think you can compare a penny rate in that case.
I am glad that the hon. and gallant Gentleman has corrected any false impression I may have given to the House. I thought the two towns were similar in population, but I withdraw that. At the same time, the illustration is a remarkable one in that it shows that a 1d. in the £ will produce about six times more in one place than it will in another where the population is only two and a half times more. The Chancellor of the Exchequer has stated that we were prepared to give more money to small schools, as recommended by the Kempe Committee. There are two variations of their recommendations. The Committee propose that the Small Schools Grant to be given to the county authorities, other than the London County Council, should be given on the schools containing 200 scholars. We do not regard a school containing 200 as a small school, and we propose to distribute the sum of £372,000 in accordance with the number of small schools containing not 200 but 150 scholars. Therefore, instead of the 5s. per unit recommended by the Kempe Committee to meet the special demand in connection with rural localities, we propose to give the counties an average contribution of 8s. 4d. per unit in those schools. I hope that arrangements will be entered into whereby this particular money will be reapportioned after five years in accordance with the amount of work they do suited to the rural districts over which the authorities have control. I am very anxious to see practical work taught in many of these schools, such as gardening and work connected with the industries of the localities, so that the children may have a real practical education in those areas. This money is first to be given for five years and then reapportioned among those areas in accordance with the amount of real education carried out by the authorities.
Will similar relief be applied to the necessitous areas which is equally as important?
In regard to the Necessitous Areas Grant, I will come to that in a moment, but there is one point I should like to dispose of before I come to that, because there is doubt in people's minds as to what is going to happen to the money which is being devoted to technical education, that is the money which is usually called the Whisky Money and which has been devoted for many years by the education authorities to technical and manual instruction. The money will be voted as heretofore, and I think that a similar provision might also be adopted in connection with the distribution of that money, and that whilst the total sum of £807,000 which is now being spent by the education authorities in connection with technical education should not be changed as to the aggregate sum but should be made out every five years and reapportioned in connection with the work and necessities of the various authorities. That is only a suggestion which I am throwing out at the present moment. I am not making a definite proposition as to whether that money should be reapportioned or left to the authorities as at present or dealt with in some other way. Then as to the point raised by the hon. Member for Merthyr, I should like to say that although the Grants in relief of rates for services other than education will be postponed for four months owing to the necessity for dividing the Budget into two Bills, yet so far as education relief is concerned we make no change at all, and the whole £515,000 as originally announced by the Chancellor of the Exchequer as a contribution to the education authorities in connection with their work this year, will not be changed at all. That money can, be distributed without any legislation. That particular money will appear as a Supplementary Estimate upon the Votes, and the House will then have an opportunity of passing it and the local education authorities will have an opportunity of receiving it. That £515,000 will probably be divided into two amounts— £438,000 for necessitous areas, and £77,000 for the provision of meals, which will meet about half the cost of providing meals incurred by the local education authorities during the past year. Of that £438,000 in the necessitous areas, approximately £150,000 will be distributed among fifty-seven necessitous authorities who already are receiving the £350,000 Necessitous Areas Grant. That £150,000 will be in addition to the £350,000. Then thirty-four authorities have not shared with the fifty-seven authorities, although their education rate has been over 1s. 6d. in the £, and therefore it is proposed to distribute the amount of excess over the 1s. 6d. in the £ amongst those thirty-four areas previously omitted. That will absorb £288,000.
I want the House to understand that this is purely a temporary expedient for this year, and we have accepted the principle of necessitous areas only this year in order to meet the great demand upon the State for assistance during the current year until we get a. better system established. As soon as we get our new block system, it will be unnecessary to continue the system of necessitous area Grants, which is an unsound one. Although the system deals with those most heavily rated, it has not got a true perspective of the poverty of the various areas or the amount of progressive expenditure which may be incurred in those areas. Therefore it is only a temporary expedient devised to meet the immediate necessities. I believe it will do that, and enable progressive work to be done by the education committees during the coming year. I trust that by the passage of both the Finance Bills into law we shall be able to secure the larger sum, which will establish a sound system of national education throughout the country.
Motion made, and Question, "That the Debate be now adjourned"—[ Mr. James Hope ]—put, and agreed to.
Debate to be resumed to-morrow (Wednesday).
Superannuation (Ecclesiastical Commissioners and Queen Anne's Bounty) Bill
Order for Third Reading read.
Motion made, and Question proposed, "That the Bill be now read the third time."
I do not want to oppose this Bill, but will the hon. Gentleman in charge of it give the House an assurance that before it becomes law the Ecclesiastical Commissioners will lay upon the Table any alterations they may make with regard to pensions.
(representing the Ecclesiastical Commissioners): The Ecclesiastical Commissioners are perfectly willing to communicate to the House any regulations they may make as to pensions. The pensions actually paid by then are always included in their Report which is issued every year.
That will satisfy me.
Question put, and agreed to.
Bill read the third time, and passed.
Trade Marks Bill
Read a second time, and committed to a Standing Committee.
The remaining Orders were read, and postponed.
Anglo-Persian Oil Company (Acquisition of Capital)
Committee to consider of authorising the application of the Old Sinking Fund for the year ending the thirty-first day of March, nineteen hundred and fourteen, to the extent of a sum not exceeding six hundred and fifty-four thousand eight hundred and thirteen pounds twelve shillings and sevenpence, for the purpose of providing money towards the sums authorised to be issued out of the Consolidated Fund for the acquisition of share or loan capital in the Anglo-Persian Oil Company. (King's Recommendation signified.) To-morrow.—[ Mr. Gulland. ]
Civil Service (Royal Commission)
Motion made, and Question proposed, "That this House do now adjourn."— [ Mr. Gulland. ]
I want to ask a question of the Under-Secretary for the Home Department with regard to an article which appeared in the "Daily Telegraph" of this morning, and which said that with some evidence given before the Royal Commission on the Civil Service was a White Paper issued last night, and then follows a prècis of the evidence given by Sir Arthur Nicholson, the Under-Secretary for Foreign Affairs, and one or two other gentlemen. I went to the Vote Office and asked for this White Paper. There is no trace of it in the Vote Office, and it occurs to me that it is most highly improper that the White Paper, if issued, of which I have my doubts, should have been issued to the Press and not first to Members of this House. I hope that the Under-Secretary for the Home Office will be able to give me some information. I asked the Under-Secretary for the Treasury about it, and he informed me that the Royal Commission was appointed under the Home Office, and therefore such responsibility as there may be rests with the Home Office and not with him. The Under-Secretary may perhaps be able to tell us how it comes about that it has appeared in the Press. I do not know whether any other newspaper had anything about it beside the "Daily Telegraph," but at any rate he may be able to tell us how it came to be published in that paper. I just want to say it is important not only in regard to the privileges of this House, which all of us hold dear, but it is also very important with regard to the evidence likely to be put before this Royal Commission, which Royal Commission is taking its evidence in private—and, indeed, a good deal of quite intimate information is being given. Such evidence will be absolutely closed down. Witnesses will refuse to give it, and the members of the Commission will not hear it if there is any danger in the future of this evidence leaking out to the Press. I do not think I need develop the argument any further. I hope the Under-Secretary will be able to say if any such White Paper has been issued. I have given him very short notice on the point, and I will, if necessary, put the question with private notice to-morrow, and if he is able to give me the assurance that any such White Paper has been issued, I will take an opportunity to ask whether it is a breach of privilege of this House to publish in the newspapers evidence given before the Royal Commission which has not been previously supplied to the House of Commons.
Trade Dispute (Burton-On-Trent)
Charge of Assault
At Question Time I gave notice of my intention to raise a matter concerning the imprisonment of Mr. Rawlings, of Burton-on-Trent. Since then the Home Secretary has courteously informed me that he has telegraphed for the information, but that it cannot possibly arrive before to-morrow. I do not therefore propose to enter into the details of the case this evening. I will ask your permission to-morrow again to put a question to the Home Secretary. It may be necessary to ask leave to move the adjournment of the House if the reply is not satisfactory, but of course that matter will also stand over till to-morrow.
With regard to the point raised by my hon. Friend (Mr. Keir Hardie), as he has told the House, the Home Secretary has made some inquiries, but has not been able to obtain complete information. I think my right hon. Friend communicated that fact to my hon. Friend. With regard to the point raised by the hon. Member for Croydon (Mr. Malcolm), I have not had notice that the question would be raised, and there has been no opportunity for making inquiries. I quite agree that the point raised by the hon. Member is of importance, but I am not even in a position to say whether or not a White Paper has been issued. I can promise him that before we meet tomorrow inquiries will be made, and if he raises the point at Question Time tomorrow no doubt sufficient information will be forthcoming to enable us to give him a reply.
Question put, and agreed to.
Adjourned at Twenty-six minutes after Eleven o'clock.