asked the Chancellor of the Exchequer whether he is aware that many retailers are complaining of losses incurred through reductions given to customers on stock bearing full rates of Purchase Tax, whilst others refuse to pass on reductions of Purchase Tax until such stock is sold; and whether he will introduce legislation to provide for uniformity of practice by wholesalers and retailers in passing on Purchase Tax reductions, wholly or in part, to their customers.

I am aware of the facts stated. The situation is open to the free play of trade competition and I am not clear that legislation to enforce uniformity, even if practicable, would be in the interest of the consumer.

But is the Chancellor aware that already permission is given to clear old stocks, according to the reply given on 25th April, and there is no check on when old stocks are finished and new stocks begin? Is not this very confusing and does not it tend to make fun of the Purchase Tax relief?

I know that the hon. Lady, for whose views in general I have very great respect, and I hold different views about this particular matter, but I would remind her that, some years ago, the Government set up an independent committee to consider the question whether there was any way to provide compensation to retailers for their Purchase Tax-paid stocks in the event of a reduction in Purchase Tax. That committee said that it could find no feasible way in which this could be done. The present position is that it is quite legal for a retailer to base his selling price on the price of the goods, including Purchase Tax, if he has paid it. Equally, he is free to reduce that price at any moment if he wishes to do so. I believe that that is the fairest method that we can discover and it is also the method which is most favourable to the consumer.

asked the Chancellor of the Exchequer whether he has considered the representations of the Scottish Rugby Union regarding the proposed new rate of Profits Tax, a copy of which has been sent to him; and what he expects the yield of this tax to be in the present financial year.

Yes, Sir. In common with other bodies, the Scottish Rugby Union will be liable to Profits Tax at 10 per cent. on its profits. The new rate applies only to profits arising after 31st March, 1958, and the effect on the yield in the present financial year is likely to be small.

Will the Chancellor reconsider this in the course of the Finance Bill? Associations of this kind do not distribute profits. Surely, ought not those who do such good work as these people at least to be left the little they have and not have it taxed by the Chancellor?

The changes I am proposing, of course, are based upon the recommendation of the Royal Commission, which recommended that Profits Tax should be levied on all profits of all corporations of every kind, at a uniform rate.

But is not this a matter for Parliament to decide, not for the Royal Commission? Is not there mounting evidence that this particular proposal of the Chancellor has been made in a very ill-considered way, in view of the evidence now accumulating, such as that given by the hon. Member for Huddersfield, West (Mr. Wade) during the Second Reading debate and other facts now coming forward, showing that a large number of non-profit-making organisations which would not dream of distributing dividends are being very seriously prejudiced? Will the Chancellor look at the matter again before we come to the appropriate part of the Finance Bill?

It is likely that I shall be compelled to listen to discussion on this matter again, because we shall have an opportunity of discussing these matters during the forthcoming weeks.

Is not it possible that bodies like the Royal Commission would underestimate the importance of games like Rugby? Will my right hon. Friend reconsider this, in the light of the fact that organisations of this kind usually use the money by ploughing it back for the benefit of the clubs and to reinvigorate the game, where it is most important, at club level?

I cannot express an opinion about how much importance the Royal Commission attached to the game of Rugby football, but I am perfectly prepared to listen to arguments which may be advanced on this matter, as on all relevant matters, during the course of discussions on the Finance Bill.

Will the Chancellor bear in mind that the profits of the Rugby unions are devoted to assisting small village clubs in all parts of the country and that, if these profits are denied them for that purpose, the clubs will break down and the right hon. Gentleman will have destroyed one of the most important amenities in every village in Wales and Scotland and elsewhere? Will he bear this closely in mind?

I certainly will bear that in mind, together with all other relevant points.

asked the Chancellor of the Exchequer what instructions he has given to Her Majesty's Customs and Excise regarding the sale of imported goods that have been seized at prices substantially below the prices at which they could be sold if duty had been paid on them.

Goods forfeited to the Customs are sold by competitive tender at prices which normally include any import duties. If the hon. Member has any particular case in mind and will let me have details, I will look into it.

As I have an advertisement which reads:

"Sensational scoop purchase from H.M. Customs and Excise. Once again outbidding rivals we have bought in for our customers the most amazing consignment of dress materials from H.M. Customs and Excise…which we now offer exclusively at fantastically low prices",

would the right hon. Gentleman be good enough to consider this matter? Would he agree that it would be unfair to honest importers to have to pay duty if Her Majesty's Customs and Excise sold at substantially lower prices, or does he contemplate scrapping import duties altogether?

No. I think that I agree with the hon. Gentleman in principle. As far as I am aware, the Customs always endeavour to get the best price obtainable from the market.

asked the Chancellor of the Exchequer what instructions he has given to the Commissioners of Inland Revenue regarding claims for deduction from taxable expenses of money spent on advertisements consisting of company chairmen's statements at annual meetings largely devoted to political propaganda.

None, Sir. Claims of this nature, like claims for a deduction in respect of other business expenditure, fall to be considered in the light of the rule laid down by law that outlay is deductible if, not being of a capital nature, it is incurred wholly and exclusively for the purposes of the trade.

But is the Minister aware that in the first fortnight of this year the six big steel combines spent tens of thousands of pounds on newspaper advertisements of this kind? Have these advertisements been allowed as trading expenses? Secondly, has other expenditure on this campaign been claimed and allowed?

The criterion which is adopted is the criterion that I have explained. Of course, it is not for me to interpret the law. That is for the Commissioners and, on appeal, for the courts.

While it is not the Chancellor's function to interpret the law, is not it his function to propose appropriate changes in the law which, for example, private Members cannot propose, as they would impose a charge? Apart from the cases referred to by my hon. Friend the Member for Salford, East (Mr. Frank Allaun), has the Chancellor seen a statement by a company chairman showing that his company spent—largely financed by the Chancellor—£83 million on advertising last year, and then he spends more money to advertise that statement, to send it round the country, to M.P.s and others, and to print it in newspapers? The Chancellor is being asked to pay the greater proportion of the cost of propagating that chairman's views.

I agree with the first point that the right hon. Gentleman made; it is certainly for me to propose a change in the law if I find that one ought to be made, but in this case I have no proposal to make to change the law at present. It does not seem to me that one can object to advertisement expenditure merely because of the cost of it. It certainly ought not to be for the Revenue to lay down what should be the appropriate total expenditure of any particular firm on advertising. That is surely a matter of judgment for the firm concerned.

asked the Chancellor of the Exchequer the criteria which distinguish a hearsette from a hearse.

A hearsette carries mourners as well as a coffin.

Is the Chancellor aware that when the mourners attend the ceremony in the vehicle which is attached to that which carries the body a Purchase Tax of 60 per cent. is levied and if they go separately they get a tax-free ride? Does not he think that that is an anomalous situation? For all that he gets from taxing the hearsette at 60 per cent., is it worth maintaining the tax? Will the Chancellor consider dealing with the matter during the passage of the Finance Bill?

I admit that that kind of Scottish anomaly had not occurred to me. It seems rather like the Aberdonian who complained when the cost of bus fares was put down because he did not save as much by walking.

On a point of order. A tax is levied on the hearsette——

That is not a point of order. The hon. Member is always trying to put points of order which are not points of order.

asked the Chancellor of the Exchequer the net contribution of the shipping industry to the balance of payments in each of the last two years; and how he calculates these figures.

It is estimated that the dry cargo shipping industry made net contributions to the United Kingdom's balance of payments of £280 million in 1956 and £300 million in 1957. These amounts are estimated by deducting United Kingdom ships' disbursements in overseas ports and time-charter hire payments by United Kingdom shipping companies, from income received by the industry from abroad in respect of freight, charter hire and passenger fares.

While thanking the right hon. Gentleman for that very informative reply, may I ask him what the earnings from tanker freights were, and may I also ask him if it is a fact that those figures are different from those normally printed in the balance of payments White Papers, which take account of the disbursements of freights on United Kingdom imports and thereby give an under-estimate of the great contribution made by this industry?

Yes, Sir. The figures are different from the figures published in the annual White Paper, and if my hon. Friend likes I will write to him to explain why that is so, but I think he understands the reason for it. I am afraid that it is not easy to give the net earnings of the tankers because, as my hon. Friend knows, they are owned mainly by the oil companies and it is extremely difficult to separate their earnings from freights from their other oil earnings; but that would amount to a substantial sum. Thirdly, I entirely agree with him that these earnings reflect the greatest credit on one of our most important national industries.

asked the Chancellor of the Exchequer, in view of the importance to the national economy of the provision of increased facilities for the study of science and technology, if he will make an additional grant to the University Grants Committee for the benefit of the proposed Churchill College, Cambridge; and if he will make a statement.

I understand that the University Grants Committee, which has expressed its sympathy with this proposal for a new college, has been informed that the establishment of the college will depend on the success of the public appeal for funds which has been issued by the Trustees. It is understood that Cambridge University is unlikely to make an application on this account to the University Grants Committee, at any rate during the period up to 1963, for which the sum to be available for non-recurrent grants has been provisionally determined.

Is the Chancellor aware that hon. Members on both sides of the House will welcome the initiative of Cambridge University both in seeking to perpetuate the name of the illustrious right hon. Gentleman the Member for Woodford (Sir W. Churchill), on the one hand, and in making a new contribution to the supply of scientists and technologists, on the other? Will he support the appeal that the university is making to industrialists and commercialists for funds, and will he also consider identifying the Government in some way with this great new historic venture?

I do not think there is much I can add to the Answer I have given the hon. Gentleman, except to say that I welcome the idea of this new college and hope very much that the appeal will meet with a satisfactory response. It seems a constructive step forward in the extension of the facilities for university education which the Government are doing a great deal to support.

May I ask the right hon. Gentleman, in view of the importance of this new technical college, whether the Government are in any position to assist those who are trying to raise the necessary funds towards its establishment? Does he agree that it would be a great tragedy if, for the sake of a small sum of money, which the Government may or may not be able to provide, the scheme were abandoned? Is not it a good thing for this country if we can pay a tribute to one of Britain's greatest statesmen at the same time as providing what is urgently needed in this country, a new college devoted to technical education?

I could not agree more with the general tenor of the right hon. Gentleman's remarks, and in particular with the last part of his supplementary question. On the first part, he will remember the programme I announced in the House a few months ago envisaging a substantial extension in the programme of expansion for the universities at a very considerably increased cost to public funds.

asked the Chancellor of the Exchequer whether, in view of the recent statement of the Principal of the University of London, he will increase the grant to this university, and, if necessary, to other universities.

No, Sir.

Is the Chancellor aware that the Principal of London University, Dr. Logan, has said that the 8 per cent. increase which has been made in the university grant does not in any way compensate for the rise in the cost of services since 1951, when the Estimates were prepared, and that in his annual report he has estimated that London University alone will be nearly £500,000 short of its requirements if it is to do the job it has set out to do? Will the right hon. Gentleman take grave note of the words of this eminent gentleman on this subject and consider again the question of the inadequacy of the university grant?

I am aware of the words to which the hon. Gentleman has called my attention but, with the best will in the world, there must be a limit to the resources that can be made available, even for the excellent purpose of expanding university facilities. As the hon. Gentleman instanced the pace at which we are moving, I would mention that the grants made for last year, 1957–58, were 20 per cent. higher than for the previous year, and our plans over the next four years provide for a further increase amounting to 28 per cent. for those four years.

Yes, but is the right hon. Gentleman aware that there are complaints from many universities that his grants are still inadequate to meet the needs of the country, especially in science and technology? Is he aware, in particular, that some very important programmes are having to be reduced? While no one wants to interfere with academic freedom, will the right hon. Gentleman look again to see if he can give some special incentives to our universities to encourage education in science and technology over and above the existing quinquennial programmes?

While again I agree with the desires of the right hon. Gentleman on this matter, I think anybody looking at the programme of expansion we have accepted must consider that it is relatively an extremely generous allotment of the national resources.

asked the Chancellor of the Exchequer, having regard to the increase from 600 units to 1,000 units maximum permissible holding, tenth issue National Savings Certificates, also the new Defence Bond issue from 1st May, 1958, both designed to stimulate small savings, whether he will now give similar and commensurate stimulus to savings banks deposits by increasing from £600 to £1,000 the limit on deposits which do not attract income tax upon the interest.

I do not consider this step would be justified.

Can the Chancellor say why not, and will he have some regard to the fact that incentives to small savers through the media respectively of National Savings Certificates, Defence Bonds and deposits in the savings banks, ought to be approximately in line the one with the other?

Again it is a question of priorities and the limitation of the resources available at the moment. There has been no general demand for the concession which my hon. Friend has mentioned, and no reqeust for it from the National Savings Movement. At present 95 per cent. of the depositors come well within the limit of £600 now in force, but naturally it is a matter on which I shall keep my eye.

asked the Chancellor of the Exchequer the present rate of interest on tax reserve certificates; at what date such rate first became operative; and what changes he now proposes in the rate.

The rate, which is at present 3¼ per cent., was last changed on 29th March. I cannot forecast any future changes.

Would the Chancellor go as far as to say that the rate of interest for tax reserve certificates will move up or down in accord with interest rates generally?

I am afraid I could not go quite as far as to say even that. In fact, I can go so little distance forward to meet my hon. Friend in this matter that I cannot move at all.

asked the Chancellor of the Exchequer whether, having regard to the recent change in the Bank Rate, he will now raise the Capital Issues Committee exemption limit from £10,000 to £50,000.

The existing financial and credit restrictions are being kept under continuous review, but I have no proposals for changes to make at the present time.

Yes, we are all aware of that, Mr. Speaker, but is not it a fact that the unduly harsh and restrictive limit of £10,000 only was introduced in the quite exceptional circumstances of last September? As the Bank Rate comes down—no doubt it will come down again in the next few weeks—would not it be appropriate that this limit should move back from £10,000 to £50,000, where it was prior to last September?

I think I will confine myself to saying that our present controls are extremely flexible.

Will the right hon. Gentleman take it, at any rate from this side of the House, that we support him in not giving effect to his hon. Friend's proposal, and that if he were to move even a little way to meeting his hon. Friend, he would be moving not forward but backward?

I hope I can rely on the right hon. Gentleman's general support throughout this evening and tomorrow evening.

asked the Secretary to the Treasury if he will now relax the instruction that the Vote Office may supply an hon. Member with only one copy of the daily Official Parliamentary Report.

No, Sir.

Is the Financial Secretary aware that pettifogging restrictions of this kind, which can easily be circumvented, make our Legislature about the most parsimonious in the world in not supplying hon. Members with necessary papers?

No, Sir. I think the present arrangements for supply are reasonable and meet the general convenience of hon. Members. Not only does the Vote Office on its own initiative supply one copy of the Report daily, but it will supply an additional copy to any hon. Member who calls to draw it. In addition, six of the "tear-off" copies of certain portions of the daily Report can be obtained, besides which, as the hon. Gentleman knows, there is available the weekly HANSARD and the HANSARD bound volume for those who need that for their own purposes.

asked the Minister of Housing and Local Government and Minister for Welsh Affairs what further report has been made to him on research which has taken place on the problem of gas liquor being processed by sewerage works or in relation to pollution of rivers.

The Gas Council, which is conducting the research, reports to my noble Friend, the Minister of Power, and not to my right hon. Friend. I know, however, that this extremely complex and technical problem is being continuously examined and my right hon. Friend is being kept in touch with the position.

May we expect within a very short time a report from the Minister of Power, through the Minister of Housing and Local Government, because every local authority which has this great problem is concerned in case its sewerage works are put out of action if more gas liquor has to be taken?

I am afraid I cannot tell the hon. Lady when we are likely to have a report on this research, but it is going on, and we are always anxious to help the local authorities in the Potteries. We have, in fact, authorised new works both at Hanley and at Stoke-on-Trent.

asked the Minister of Housing and Local Government and Minister for Welsh Affairs what consultation has taken place with the agricultural industry on the question of the use of compost as a fertiliser from combining municipal refuse and sewage sludge; and if he will make a statement.

My right hon. Friend has had no consultations with agriculture. He has however every reason to think that local authorities know of this method of dealing with these materials, and it is for each authority to decide in the first instance what method best suits its own circumstances.

But as in a recent reply which I received from the Minister of Agriculture it was stated that this had been found to be a very valuable fertiliser, would not it be wise, when new sewerage works are being authorised, that the Minister should make a strong recommendation that this method of composting household refuse and sewage should be carried out as a long-term policy of economy and of service to the agricultural industry?

I agree that is the view of my right hon. Friend the Minister of Agriculture that the manure which is produced is useful. The trouble is that it cannot be an economic proposition unless there is a ready local market for it because the stuff is bulky and the transport costs are high. If, however, any local authority wants to undertake work of this kind, and can show my right hon. Friend that it can pay its way, he is likely to give his consent.

asked the Minister of Housing and Local Government and Minister for Welsh Affairs whether he has yet considered all the comments and criticisms sent to him regarding the draft Regulations for the control of outdoor advertisements which he circulated last year to a number of organisations; and whether he will make a statement.

I must apologise for a somewhat long Answer. I have now considered the comments of the bodies representing amentity and other interests, local authorities, the advertising industry and retail trade, to whom I circulated draft new Regulations last year. The draft Regulations, besides seeking to consolidate the existing code, proposed changes of substance on three main topics—advertisements on business premises, the advertisements permitted in areas of special control, and the machinery of control.

On the second and third of these topics, the comments reveal a sufficient measure of agreement for me to proceed with proposals which I think will command fairly general assent. Some further detailed consultations will be required, after which I hope to lay the necessary amending Regulations.

But on the proposals about advertisements on business premises there are such strongly held opposing views that I do not think the draft Regulations will do as they stand. I propose therefore to invite certain of the organisations and interests principally concerned to send representatives to a joint meeting with me, in order that I may see if I can find a basis for agreement.

Is my right hon. Friend aware that his efforts to reconcile normal business interests with the desire of many of us to prevent the display of unsightly and misplaced advertisements will be very much welcomed?

Does the Minister's Answer mean that there will be more or less outside advertising in the areas of special amenity?

In the areas of special control, the existing Regulations have been too tight, and they have therefore dissuaded planning authorities from seeking to declare areas to be areas of special control. I think that there is general agreement that some loosening of the Regulations will achieve better preservation of the countryside.

asked the Secretary of State for the Colonies what criteria have to be satisfied before a British-protected person in Northern Rhodesia or Nyasaland can obtain a passport.

Passports are issued under the Royal Prerogative exercised by the Governor of the Territory and he may at his discretion impose conditions on the grant of a passport in the light of the circumstances of each particular application.

As passports have recently been refused to British-protected persons who wanted to attend the Asian Socialist Conference at Bombay, and to others who wanted to attend the British Labour Party Commonwealth Conference in this country last year, will the hon. Gentleman give an instruction that in future passports shall not be refused solely on the ground of the political views of the applicant?

I cannot give the undertaking—[HON. MEMBERS: "Why not?"]—I am trying to tell the hon. Lady—because I do not accept the premise that passports are withheld solely on account of the political views of the applicant. What I will say is that there are particular instances in which security considerations may arise, and in those cases it must be left to the Governors' discretion.

Will the hon. Gentleman bear in mind that in all these Territories there is a conflict with the Communists for the minds of the people? Does not he agree that Africans should be encouraged to send delegates to democratic conferences, such as the one my hon. Friend mentioned? In refusing these passports, is not the Colonial Office showing political stupidity of the worst character?

I am very sorry, but I cannot accept that either. The Colonial Office is not responsible for this, nor is my right hon. Friend displaying any stupidity. This is the responsibility of the Governors of the Territories concerned. I assure the House that the Governors use their discretion with the greatest regard to the national interest.

Can the hon. Gentleman tell us what issue of security arose in connection with applications to visit the Labour Party Commonwealth Conference in this country last year?

No, Sir. I did not say that issues of security arose in any particular case. What I said, and I think that it was quite clear, was that people are not refused passports merely for their political allegiances, but security does enter some cases. If the hon. Lady would like to ask about any particular issue, I shall be only too glad to try to answer her.

asked the Secretary of State for the Colonies whether he is yet in a position to report on his discussions with the Governor of Northern Rhodesia over the segregation of European and African witnesses in the High Court at Lusaka.

As my right hon. Friend informed the hon. Lady in his letter of 19th May, he has now heard from the Governor that all the four waiting rooms in the High Court building are available to witnesses without any distinction of race.

While asking the hon. Gentleman to thank the Colonial Secretary for the steps he has taken to remedy the situation, which has been remedied solely as a result of my putting down this Question, as the Colonial Secretary's letter to me explicitly explained and which I am sure the hon. Gentleman will agree to be the case, may I ask him whether he considers that this is the sort of situation which the Race Relations Committee in Lusaka ought to be preventing? Will he arrange that in future plans of public buildings should be submitted to the Race Relations Committee in order to prevent these unfortunate incidents of segregation of people?

No, Sir. There was no discrimination about this. My right hon. Friend's letter was written to the hon. Lady to spare her the embarrassment of asking a socially difficult question about lavatories, and if the hon. Lady really believes that there was discrimination and that this was not merely a human problem, she has misunderstood my right hon. Friend's letter.

asked the Secretary of State for the Colonies what action is being taken to make the Legislative Council in British Somaliland more representative, and to extend general development and education in the territory.

I would refer the hon. Member to the reply which my right hon. Friend gave to him on 1st April.

Is the hon. Gentleman aware that that reply did not cover all the points which are raised in this Question? As Italian Somaliland is to have independence in 1960, and in view of the danger in that situation with the absence of political advance in British Somaliland and in its social and economic conditions, which may create a very difficult situation, will the right hon. Gentleman give the attention of his Department to these necessary developments?

It would be better to await the Report of the Constitutional Commission.

asked the Secretary of State for the Colonies what written commitments have to be made by detainees in Kenya camps before they are considered eligible for release.

None, Sir.

Is not it the case that at Nyeri in March this year a detainee was asked to sign a document in which, in order to get his release, he had to pledge that:

"I will never be an agitator.

I will never enter into the organisation of the agitators.

I agree to the land consolidation programme.

I shall never ask the Government to pay back any loss incurred while I was a detainee."

Is not it clear that the right hon. Gentleman has been misled by the Governor in stating that there are no commitments?

My right hon. Friend has not been misled. Release does not depend on confession, either verbal or written, but wholly on the Governor's judgment of whether, for the purpose of maintaining law and order, which the hon. Lady realises as well as anyone else is still in danger in this Territory, it is still necessary to exercise control over an individual.

asked the Secretary of State for the Colonies what steps are being taken by the Government of Tanganyika to check the increasing number of thefts of European-owned cattle.

I would refer my hon. Friend to the answer my right hon. Friend gave to my hon. Friend the Member for Crosby (Mr. Page) on 15th April. The Tanganyika Government has this difficult and long-standing problem much in mind; measures at present under consideration include the possibility of legislation dealing specifically with stock thefts.

While thanking my hon. Friend for that reply, may I ask whether he agrees that stock-breeding is extremely important to the agricultural people of Tanganyika? Does not he agree that attacks by armed Africans appear to be increasing; and, as the Europeans concerned are taxpayers, are not they entitled to adequate protection?

I agree generally, but some of the recent reports have been very much exaggerated.

asked the Secretary of State for the Colonies whether he will give consideration to the establishment of an upper house of the Tanganyika Legislature.

The Governor of Tanganyika has recently stated that in his view there would be considerable merit in establishing some form of State Council in Tanganyika in which the wisdom and experience of the traditional authorities would find expression and where others, who might be discouraged by inclination or because of other commitments from serving in the Legislative Council, would be able to make their full contribution to the solution of the Territory's problems. The Tanganyika Government are carrying out a detailed examination of the question and will have some points to put to the next Chiefs Convention in June with a view to setting in train certain joint studies which would form the ground work for later consideration of this matter by the Post Elections Committee. It is too early to say how closely such a body, if created, would approximate to an upper house.

If this matter is to be considered and if it is too early to give a final answer, will the Under-Secretary of State give an assurance that the purposes of such a chamber would not be to frustrate the will of the Legislative Council, for in those circumstances it should not be persisted in?

I do not think that the Post Elections Committee—created as the hon. Gentleman knows it will be—would allow the development of any such organisation.

Would my hon. Friend agree that the provision of a second chamber would provide a democratic method for the chiefs to express their views, and have not these men a considerable part to play in the political future of Tanganyika?

I think that they have.

In that case, would not it be better to allow them to take their place in the Legislative Council?

I think that we had better wait to see how this develops.

asked the Secretary of State for the Colonies whether he will make a statement on the decision not to press the United States of America to give up Chaguaramas for the site of the capital of the West Indies Federation.

asked the Secretary of State for the Colonies whether he will make a statement on the report of the expert committee on the site for the capital of the West Indies.

Her Majesty's Government would certainly have invited the United States Government voluntarily to surrender their rights at Chaguaramas as an act of generosity if the Joint Commission had reported that all or part of the base could be given up without adversely affecting defence, or could be replaced at any reasonable cost. But in view of its report, and bearing in mind the overriding importance of the base to the defence of the Western Hemisphere, which is also of vital concern to the West Indies, Her Majesty's Government could not reasonably ask the United States Government either to relinquish part of the base or to meet the very considerable cost of moving the whole of it to a less satisfactory site.

Her Majesty's Government realise that the Commission's findings will cause disappointment, but they hope that the Governments of the West Indies and of Trinidad will recognise that they make Her Majesty's Government's attitude inevitable.

Is not this decision a very serious set-back to the new Federation? Is it too late, even at this stage, to press the United States to give up at least part of this area for a capital? It seemed to me, when I visited the area, that there was plenty of room for that without infringing on the defence needs. If that is out of the question, can the Minister say what is the next step in finding a capital? Is the whole thing in the melting pot once again?

The hon. Member has asked a number of questions. Of course, it is a serious step, but this was a unanimous report of representatives of all the Governments concerned and I must disagree with the hon. Gentleman that part of Chaguaramas could be given up. I have just come back from there, and speaking as a layman—both the hon. Gentleman and myself are laymen in this connection—I should be at variance with him, and I think that my view would command as much credence there as would his view. Now that the Government of the Federation has been set up, it will be for that body to take such decisions. Perhaps I should add that Her Majesty's Government will always stand ready to give such advice as may be sought from them.

Is my hon. Friend aware that, like him, I know Chaguaramas very well and I find the Joint Commission's report completely astonishing, particularly in view of the neglect and decayed condition into which the United States naval authorities have allowed the district to fall? Is he aware that one finds the statement of the Colonial Office very disturbing because it certainly can be interpreted as slamming the door in the face of the West Indian Government? Will he give us every assurance that the Colonial Office will do all possible to find a solution agreeable to the West Indian Government?

I am sorry that my hon. Friend does not agree with me, but at least I have agreeing with me a body of technical information which is very large and entirely unanimous. As to the statement made by Her Majesty's Government, the Governments of the West Indies and Trinidad were reluctant, for reasons which Her Majesty's Government fully recognise, to issue any agreed statement of conclusions on the publication of the report. Had we waited to make plain the attitude of Her Majesty's Government, perhaps until after the United States had made a statement, we might have been criticised for making our statement under pressure from the United States, and that was not the case at all. I believe that it is for the Federal Government to try to find an alternative solution, and I am sure that it would not be for my right hon. Friend to seek to impose a solution on any of the parties.

Whatever may be the technical considerations, is not the overwhelming political consideration the setting up of a new Federation which desires a capital in this place? Does the hon. Gentleman really mean that this site is so vital to the United States; and, if that is so, may I ask why there has not been further development of it during the last few years? Is the Under-Secretary aware that the United States is spending something like £1,500 million a year overseas, and is he really saying that the cost of establishing a new site would be so great that the United States is not prepared to do that, even in view of the political implications?

I am anxious that this matter shall be understood by hon. Members on both sides of the House. First, there is a wide difference of opinion, even among people in the West Indies, about whether Chaguaramas is the right site for a capital. There is no agreed conclusion on that. There is a wide measure of disagreement—perhaps the hon. Gentleman had better read the report for himself.

It is not a question of what it will cost to move this enormous base to a less good site but the fact that it would take from between five and ten years for the United States to be able to establish a military shield once again in front of the West Indies for the protection of the Western nations. In view of those things, and if he will read the report, I believe that the hon. Member will consider it better to desist from further inflammatory statements.

We regret this decision but if it is to stand, and as any other site for the capital is almost certain to cost a great deal more money, may I ask whether Her Majesty's Government are prepared to accept the financial responsibility?

I do not accept the contention of the right hon. Gentleman.

In view of the very unsatisfactory nature of the hon. Gentleman's reply, and as, thanks to his courtesy I have received from the Colonial Office a copy of the Report, I beg to give notice that, having read the Report, I shall endeavour to raise this matter on the Adjournment.

asked the Minister of Works what steps he has taken to prevent the threatened destruction of an important section of the Roman Wall of London.

I assume that the hon. Member is referring to a section of the London Wall between Cripplegate and Falcon Square. Three bastions consisting largely of Roman work are scheduled under the Ancient Monuments Acts and notice is accordingly required of any intention to carry out works affecting them.

Adjoining the southernmost of these bastions and to the south of it a short stretch of wall was also scheduled. Although there may be Roman remains below ground, this consisted mainly of the upper parts of the mediæval city wall; the lower parts had been cut away and modern brickwork substituted. This piece of wall and its junction with bastion 14 were recently demolished inadvertently in connection with the construction of Route 11 and there was minor damage to the bastion itself. My inquiries into the circumstances of this incident are not yet complete.

I appreciate that as soon as this regrettable incident came to the notice of the Minister and the City engineer, steps were taken to prevent further damage. Will the hon. Gentleman bear in mind the constant danger of destruction? Will he also bear in mind that the real solution is to proceed immediately with the plan, already agreed in principle, for the creation of a sunken garden to bring the wall down to the level of the inner ditch?

I am examining means of preventing an incident of this kind from occurring again. The City of London has been most co-operative in this matter and regrets what has happened as much as I do. I will consider further what the hon. Gentleman has said.

asked the Minister of Works whether he has any further statement to make about the site for the proposed statue of Sir Walter Raleigh.

As I stated on 4th March, I have undertaken to find a suitable site in London for a statue of Sir Walter Raleigh by Mr. William McMillan, R.A., which will be erected at the cost of a number of generous individuals and companies who wish to commemorate the early links between the British Commonwealth and the United States of America.

In view of the strong desire of the Royal Fine Art Commission and of the Trustees of the National Gallery that the statue of James II by Grinling Gibbons should not now be removed from its present site, I have reconsidered the matter. I have now decided that the proposed statue of Sir Walter Raleigh should be placed in the garden to be laid out on the Whitehall frontage of the Government offices now being erected in Whitehall Gardens. The R.F.A.C. has thanked me for accepting its advice and has expressed its approval of the new site.

asked the Secretary of State for Scotland if his attention has been drawn to the discovery, at or near Loch Ness, of a giant-sized webbed claw, like that of a pre-historic monster; if he is aware that an investigation is to be made on the spot into the allegations as to the existence in Loch Ness of a monster; what assistance his Department will give to these investigations, by grant or otherwise; and if he will make a statement.

I have seen Press photographs of this claw, but its value as evidence can only be assessed by scientific examination. I understand that, from the photographs, the object appears to resemble an alligator's foot—possibly stuffed. I have not been asked to assist any investigation of Loch Ness.

Does not the Secretary of State realise that the important contribution which Loch Ness may make to scientific problems has been recognised by the B.B.C., which, at great expense, undertook an expedition there last Thursday, by a distinguished author who wrote a book on the subject and by the principal Scottish newspapers? Does not he think that it is stultifying in this scientific age not to take serious notice of the important discoveries which may be made there and for which he may have the credit?

I confess that I am still unable to find that I have any clear-cut responsibility in this matter. Speaking as Fisheries Minister, there is no evidence that the fisheries in Loch Ness need protection, either from the alleged monster or from the investigators, or vice versa.

Will not my right hon. Friend agree that the story of the Loch Ness monster, apart from any scientific value that it may have, is a source of considerable tourist interest to Scotland, and will he please do nothing to explode it?

asked the Secretary of State for Scotland what representations he has received concerning tide and storm damage at Eastfield, Edinburgh; and what action he proposes to take in this matter.

I have received a letter from sixteen owner-occupiers of property at Eastfield about the need for repairing the sea wall there, and I have asked Edinburgh Corporation, as coast protection authority, for its comments on it.

Is the right hon. Gentleman aware that the property of a number of people is very seriously endangered through no fault of their own? They have, in fact, done all that they can to maintain the sea wall there. Will he see that something is done about this matter which has been outstanding for a considerable time?

I think that I should await the comments of Edinburgh Corporation before making any further statement.

asked the Secretary of State for Scotland if he will make a statement on the results of his visit to the City of Aberdeen on and about 16th May, with particular reference to the fishing industry, the need for more light industries and the unemployment problems.

My visit gave me a welcome opportunity to see at first hand various activities connected with the Aberdeen fishing industry, including the valuable research work going on at the Marine Laboratory and the Torry Reseach Station. As to the attraction of light industries to the area, and its unemployment problems generally, I am keeping in close touch with my right hon. Friends the President of the Board of Trade and the Minister of Labour and National Service.

Is the Secretary of State aware that I shall have to strike a somewhat more critical note in this supplementary Question, as it does not affect the monster? Is it a fact that he has spent only a couple of hours in Aberdeen and is not it a pity that he should go so far to see so little and do so little? Will he pay more attention to the needs and the problems of Aberdeen, and will he arrange for the monster's claw to be put in the Library of this House?

I spent a very valuable and interesting day, arriving there about 11 o'clock, as my train was late, and leaving about 6 o'clock in the evening, having seen a lot.

asked the President of the Board of Trade on what estimate of cinema attendances he has calculated the yield for the films levy for the years ending October, 1958, and 1959, respectively.

The yield of the levy depends on a number of factors in addition to the level of cinema attendances. The new levy rate has been fixed on the assumption that attendances will continue to fall, but not so sharply as during recent months when they have been about 20 per cent. lower than a year previously.

Does the Parliamentary Secretary realise that it is not in the best interest of British film production that its income, to a large extent, should be tied to such an unstable source as cinema admissions, and would not he consider some other method of subsidising production because, after all, this method is just a subsidy?

I cannot consider an alternative method at present.

asked the President of the Board of Trade if he is yet in a position to make a decision in regard to the New Zealand Government's request for action to be taken under the Anti-Dumping Act.

asked the President of the Board of Trade to what extent his inquiries into the complaint made by New Zealand and the English Milk Marketing Board on the dumping of foreign butter here have revealed the existence of grounds for action under the Customs Duties (Dumping and Subsidies) Act, 1957.

asked the President of the Board of Trade if he will now state what action the Government proposes to take to meet complaints about dumping of butter in the United Kingdom.

asked the President of the Board of Trade if he will make a statement on the discussions with the Government of New Zealand concerning butter imports into the United Kingdom, indicating whether an agreement has been arrived at or is imminent.

asked the President of of the Board of Trade what agreement has been made with the New Zealand Government about butter imports.

The consideration of the applications made under the Customs Duties (Dumping and Subsidies) Act, 1957 so far as they relate to Finland, Sweden and the Irish Republic has been completed. Her Majesty's Government are satisfied that exports of butter by these three countries have been promoted by subsidies. We are still considering the application relating to Argentina.

The Government have decided that the subsidised imports have caused material injury to the New Zealand dairy industry. We have not found any such material injury to the dairy industry in this country.

The Government consider it is in the national interest to take action on the New Zealand application. They have therefore asked the Governments of Sweden and Finland, which are traditional suppliers of butter, either to eliminate the practices complained of, or to keep their exports within agreed limits which would begin to operate as from today. If they are unwilling to take either course the Government will impose countervailing duties.

As regards the Republic of Ireland, also a traditional supplier of butter, we have requested the Government in accordance with the provisions of the Trade Agreement of 1938 to enter into consultations on a similar basis.

I will make a further statement to the House as soon as we know what the three Governments concerned proposed to do.

Since the New Zealand application was made, imports of butter from Poland have increased sharply. It has therefore been decided independently of the action to be taken in the case of Finland, Sweden and the Irish Republic, that imports of Polish butter should also be limited. In addition the open licence for imports of butter from Eastern Europe generally is being withdrawn.

We estimate that over the course of a year our supplies of butter from the countries I have mentioned will be reduced by an amount equal to some 10 per cent. of our total supplies in 1957, that is by about 40,000 tons. A reduction of this order will strengthen the market and be of substantial assistance to New Zealand.

Will my right hon. Friend explain why, with the anti-dumping legislation on the Statute Book, it was really necessary for no action to be taken until New Zealand made this complaint? Does not this seem a little odd in view of the natural ties between our two countries and the fact that we have always had a continuous and regular supply of good quality butter from New Zealand? Do not family loyalties count for anything these days?

That is the manner in which the Act is operated, and I explained it to the New Zealanders a year or two ago.

As the President admits that New Zealand has been injured, will he say whether the British Government offered New Zealand a direct British Government contract for the purchase of this butter at a reasonable price?

No, Sir.

While welcoming the Government's decision to take prompt action now, may I ask my right hon. Friend if he will keep in mind the very general approval that there would be for using the Act, which this House passed last year, to ensure that our good friends the New Zealanders, our own farmers, and the Danes, who are very good customers of ours, do get a fair run in the British market? Will he do that if these quota arrangements do not prove satisfactory?

Yes, Sir; I will. We have given these Governments a month in which to make up their minds. If they do not wish to accept the quota limits we will put on the duties.

Can the right hon. Gentleman give some indication of how far this decision will result in a material betterment of our butter purchases from New Zealand and how far it will meet the requirements and wishes of the Governmen of New Zealand? Can he say why we should not make a direct bulk purchase agreement with Now Zealand, which is an important and very loyal part of the Commonwealth, so that that country will know where it is and we shall know where we are, too.

The reply to the first point is that there is no doubt that the price of butter will be strengthened. It is hard to say by how much. It is difficult to say what will happen, because competition with margarine is very keen. In recent weeks, butter, at its low price, has been gaining substantially on margarine in the market. The price will be strengthened. [An HON. MEMBER: "What is that?"] A stronger price means a higher price. We do not know what will happen. On the second point which the right hon. Member for Lewisham, South (Mr. H. Morrison) asked me, if we were to make a bulk contract we should either have to put all imports under control, when the whole trade would become controlled by the Government, or we should have to be prepared to put upon the Exchequer any loss made on the New Zealand contract. Neither of those courses appears to be so efficacious as reducing the supplies of subsidised butter, as we are doing.

Will not my right hon. Friend take the opportunity to reconsider the procedures in regard to the dumping of imports on the British market? During the weekend my right hon. Friend took very speedy action against the threat of Belgian imports of butter, but in the case of these other countries there has already been a long delay and considerable damage to New Zealand trade.

Belgium never had sent us butter and therefore it was a very simple operation to withdraw the open general licence. In the case of traditional suppliers we are bound, by the Act, to determine whether or not the commodity is subsidised and whether it is doing material damage. We proceeded with this inquiry as quickly as we could.

Will the President of the Board of Trade take the opportunity to tell the Prime Minister that it does not encourage good Commonwealth relationships to keep the Deputy Prime Minister of New Zealand here for five weeks or more and then to send him home dissatisfied?

The Deputy Prime Minister, who has been kept in touch with all these talks, knows the extreme difficulty we have had in reaching a decision so soon.

Would New Zealand have welcomed a bulk-purchase contract with this country?

No, because they know we were not prepared to make it.

I beg to move, in page 29, line 16, after "etc.)", to insert:

"or Group 33 (drugs and medicines manufactured or prepared except toilet preparations)".

The purpose of this Amendment is to reduce the rate of Purchase Tax from 30 per cent. to 15 per cent. on certain proprietary drugs and medicines. It has stood at 30 per cent. for several years and was originally part of the 33⅓ per cent. Schedule. There are several reasons why this matter merits close consideration.

Only a small part of the drugs and medicines which carry Purchase Tax fall within the ambit of "drugs and medicines". Therefore, the amount of Purchase Tax payable on that small part is not a tremendous consideration. So far as I can tell, by a figure given to me by the Minister of Health only a few weeks ago, only about £37 million worth of proprietary drugs and medicines attracts Purchase Tax. The figure is based upon the wholesale value. The amount of tax at 30 per cent. raises about £11 million, out of which about £1½ million is in respect of proprietary drugs and medicines prescribed within the National Health Service, and, therefore, subject to what is generally known as the circular transaction. This means that money is voted for drugs and medicines and such Purchase Tax as is then paid to the supplying wholesalers finds its way back, as a circular transaction, to the Treasury.

The Conservative Party has from the outset been strongly opposed to Purchase Tax on drugs and medicines. I have looked up the debate which took place on the Finance Bill, 1948. I find that Mr. Osbert Peake, who was then the hon. Member for Leeds, North, and is now Lord Ingleby, moved an Amendment from the Opposition benches, the purpose of which was to abolish altogether Purchase Tax on drugs and medicines. He said:

"What we propose in our Amendment, and in the remaining Amendments of the series, is that all drugs and medicines of whatever character should be exempted from Purchase Tax."

He concluded by saying:

"We on these benches have been driven by what the Chancellor of the Exchequer has done to take up, without any form of qualification, the stand that the time has now come when all drugs and medicines should be freed of Purchase Tax altogether."—[OFFICIAL REPORT, 2nd June, 1948; Vol. 451, c. 1032–7.]

A large number of hon. Members, some of whom are still Members of the House of Commons, supported Mr. Peake on that occasion.

The general case against Purchase Tax on drugs and medicines may be stated very simply. Many of those which attract Purchase Tax are generally known as household remedies. They are very well known proprietary brands readily available to the general public, and are found in nearly every household medicine chest. These remedies are generally asked for by their brand or trade name. The purchaser relies upon the high standard of quality which is generally associated with the reputations of the manufacturers concerned.

I claim that drugs and medicines are not a suitable subject for Purchase Tax because they are essential commodities for the general public and for the household, and that they may reasonably be compared with foodstuffs. To tax drugs and medicines of a proprietary character is to place a direct tax upon the promotion of good health or the avoidance of illness.

The position has been made very complicated indeed by the fact that a large number of proprietary drugs and medicines are exempt altogether from Purchase Tax. It has been found somewhat difficult to understand why certain proprietary drugs and medicines which have been put into dispensing packs under the National Health Service are free of Purchase Tax, yet when those same drugs and medicines are sold as proprietary articles, not in dispensing packs but over the chemist's counter, they attract Purchase Tax.

In that particular case, the matter really resolves itself into a consideration as to the method of supplying the patient. If he is supplied through the medium of a dispensing pack, the article carries no Purchase Tax, but, if the article is supplied over the chemist's counter, Purchase Tax is attracted. I suggest to the Financial Secretary that that is an unsatisfactory state of affairs.

I have endeavoured to do some research on this matter, which is extremely complicated. I find that these anomalies and difficulties originally arose from the Purchase Tax (No. 5) Order, which exempted certain drugs, in the main because they were regarded as essential and/or costly. Some of them were exempt when supplied without any admixture, whereas others, under Head III of the Schedule to the Order to which I have referred, were exempt separately, or combined with one another.

Official unbranded drugs and preparations, that is to say, drugs and medicines conforming to the provisions of Part 2 of the Eighth Schedule to the Finance Act, 1948, were exempt, but these drugs and medicines were required to consist solely of one or more substance described in the British Pharmacopœia, British Pharmaceutical Code or in the Formulary prescribed by the Ministry of Health for the purposes of the National Health Service. I think that hon. Members in all parts of the Committee will see how extraordinarily difficult it is to interpret the position in regard to Purchase Tax of any proprietary drug or medicine. Dispensing packs were specifically exempted and described as special packs of drugs or medicines for dispensing purposes, but the same product in a smaller or different size for sale to the public separately, and not in a pack, attracted the tax.

The time has now come to consider abolishing altogether—or at least going half-way this year, which is what my Amendment proposes—this unsatisfactory state of affairs and a Purchase Tax application which is wholly inimical to the interests of the Government and to the interests of the public at large. I am not a doctor, a druggist, pharmacist, or dispenser and I cannot speak with professional knowledge on what is a difficult matter, but I appeal to my right hon. Friend when I say that self-medication in the matter of minor ailments is something which every right hon. and hon. Member in all parts of the Committee ought to support. If everyone who suffered a minor cut or burn, or a minor disability or ailment, resorted at once to the National Health Service, I think that a state of affairs would be created in which doctors' surgeries would be unnecessarily cluttered up. Therefore, to put a Purchase Tax on those very articles which are best suited to self-medication, and which should be found in the first-aid box of every household and every factory, is inimical to our desires to maintain a healthy, efficient and economic National Health Service.

I want my hon. and learned Friend the Financial Secretary particularly to reply to this point. I dislike circular transactions—I had occasion to refer to one recently when talking about smokeless appliances under the Clean Air Act—whereby the Treasury, by subvention, pays funds to a local authority or, in the case of the National Health Service, for the provision of equipment which attracts Purchase Tax. The Purchase Tax is paid to the wholesaler and, after describing a circumference, it finds its way back to the Treasury to offset the original amount paid in respect of that original Purchase Tax item. It must be a very inefficient system, whether it is part of our arrangements for a clean air policy or part of the arrangements for the expenditure which the House votes for the National Health Service.

I commend to my right hon. Friend, as always in controversial matters of this kind, the Division List of the House. That on 2nd June, 1948 makes instructive reading. My right hon. Friend the present Chancellor of the Exchequer voted for the abolition of Purchase Tax on drugs and medicines. He was supported by the former Chancellor, my right hon. Friend the Member for Monmouth (Mr. P. Thorneycroft). [HON. MEMBERS: "Where is he?"] He will be here any moment now. He was supported by my right hon. Friend the Member for Flint, West (Mr. Birch). He was supported by the Home Secretary. He was supported by my right hon. Friend the Member for Woodford (Sir W. Churchill). He was supported by my right hon. Friend the present President of the Board of Trade. He was supported by my right hon. Friend the present Minister of Agriculture. He was supported by my right hon. Friend the present Secretary of State for the Colonies. He was supported by my right hon. Friend the present Secretary of State for Scotland. He was supported by my right hon. and learned Friend the present Foreign Secretary.

On a point of order, Sir Charles. Would not this possibly come under the heading of tedious repetition? Would it not be possible for the hon. Member for Kidderminster (Mr. Nabarro) to read a list of these rather inconsistent hon. Members, instead of introducing each of them with the phrase, "He was supported by my right hon. Friend"?

It is not out of order, but it is rather boring.

Opinions may well differ on that; I have never known alliteration wasted on the House of Commons. The present Prime Minister similarly supported the abolition, as did the present Attorney-General, the present Minister of Works, the Secretary of State for Air, and many others.

Will the hon. Member for Kidderminster (Mr. Nabarro) give us an assurance that he will vote for his own Amendment this afternoon?

It depends what assurances are forthcoming.

When the right hon. Member for Battersea, North (Mr. Jay) was in office, he listened to very many pleas on this difficult and controversial matter and, as Financial Secretary to the Treasury, he invariably resisted them. One of my purposes in moving this Amendment is to find whether the views of Her Majesty's Government have in any way changed as a result of the admirable recommendations made by the Guillebaud Committee on the National Health Service, two or three years ago.

I have demonstrated to my right hon. Friend that overwhelmingly the Conservative Party, on 2nd June, 1948, supported the view that Purchase Tax should not be placed on any proprietary drugs and medicines of any description. If their views have changed in the last decade, we should be told why. It is my view that a step in the right direction could be taken by halving the rate of Purchase Tax. Under the formula I enunciated yesterday, I suggest that if we must have a Purchase Tax at all it should be at a flat, non-discriminatory, uniform rate of 15 per cent. It is my purpose today to reduce to 15 per cent. the tax on drugs and medicines, which are at present taxed at 30 per cent.

Will the hon. Member tell us what the Guillebaud Committee recommended on this issue, as some of us are not aware that this matter came within its purview?

I repeat my words, subject to confirming them when I read them in HANSARD. I was anxious to ascertain whether my right hon. Friend had in any way changed his views about the imposition of Purchase Tax on proprietary drugs and medicines as a result of the admirable recommendations made by the Guillebaud Committee. [HON. MEMBERS: "What were they?"] It would be out of order to say exactly what they were and I would never be guilty of incurring your displeasure in that way, Sir Charles. What we ought to know is whether my right hon. Friend has changed his views as a result of the admirable recommendations of the Guillebaud Committee.

On a point of order, Sir Charles. I think there is a little confusion in the Committee about our procedure at this point. We understood, perhaps wrongly, that while this was the only Amendment in this group to be moved there would be discussed with it the Amendment immediately following, in the name of my hon. Friend the Member for Bristol, North-East (Mr. Coldrick) and some other of my hon. Friends, in page 29, line 16, after "etc.)", to insert

"Group 34 (b)(stationery and office requisites)".

We understood that the Amendment in the name of the hon. Member for Kidderminster was the only one which would be called, but that we could widen the discussion to cover stationery and office requisites, which form a subject far apart from the subject of this Amendment, to save the time of the Committee.

If the Committee so wishes, we can deal with stationery at the same time.

I understand that that Amendment is not selected, Sir Charles.

I understood that, too, but apparently I said something different at a conference with the Opposition, and perhaps if I allow a discussion to take place on that Amendment it will please everybody.

I should like to limit my remarks to the matter of drugs and medicines. I wish I could feel that the problem was as simple of solution as does the hon. Member for Kidderminster (Mr. Nabarro), but since 1940, when the tax was first imposed, it appears to have become a more complicated question each and every year. From time to time action has been taken by the Government, either through the Ministry of Health or the Treasury, which has resulted in a situation such as that appertaining today, when it is very difficult indeed to find one's way through the maze of problems associated with what the hon. Member for Kidderminster has now raised as if it was a very simple matter.

The hon. Member made it clear that he feels that there should be no tax at all on drugs, because such a tax is a tax on health and is a bar between the citizen and his right to self-medication. As he rightly said, so many prescriptions bear Purchase Tax today that the situation becomes confusing. Sometimes, the Minister of Health pays the tax, which is then returned to the Treasury, and it must be an unnecessarily costly business, as some of us would argue, that it should be imposed, on the one hand, and taken off, on the other. How expensive it is, I do not know, and what percentage of overhead charges is involved I cannot say, but it must be fairly considerable.

Further, this matter was debated before 1948. I think that the hon. Member for Putney (Sir H. Linstead) raised it in 1947, when he did not press an Amendment to a Division, but I remember that he discussed the anomalies that existed at that time. When Mr. Osbert Peake was speaking, in 1948, he gave one or two illustrations which were interesting. He pointed out that there was a tax on an effervescent aperient known as "Eno's Fruit Salts," but that on the ordinary effervescent sodium citro-tartrate, which is exactly the same material, there was no tax at all. All the examples of this type are interesting, and one could give many more, but there are some things, in my view, that certainly do merit taxation.

For example, if one can prescribe phenobarbitone, which is not taxed, I must have some sympathy with the Treasury if it feels that it must impose a tax on a substance which is exactly the same but which bears another name. It differs only because it bears another name, and if the Treasury wish to tax it—and, incidentally, one has to pay for it three or four times the price of phenobarbitone, which is untaxed—I find it difficult to deny the Treasury the right to say that it should be taxed.

If the Treasury were to tax petroleum jelly, which is really vaseline, I would be against it, but if it was proposed to tax vaseline, which is petroleum jelly under a proprietary name, very much more costly, but differing in no way whatever from the original substance, I should find it difficult to deny the Treasury the right to tax it. I wish it were all as simple as this.

As far as I know, there is no tax on aspirin prescribed by a doctor, but I am sure that if a doctor were to prescribe a form of aspirin sold under another name, he would merit some rebuke from those responsible for payment, and there would be a tax upon it. I have every sympathy with the Treasury in saying, "We are considering the money we must find. If we are to tax drugs at all let us take substances of this kind which are not taxed when sold by their normal names, but which are taxed when sold much more expensively and carrying another name."

It would, therefore, seem that if there is to be a tax at all it is reasonable to tax goods which are openly advertised to the public. The hon. Member for Kidderminster was quite right when he pointed out that a number of articles, which are normal drugs and medicines normally prescribed by the medical profession, are never advertised to the public but are also taxed. An attempt has been made to avoid this as far as possible by the work of the Cohen Committee. I think I am right in saying that that Committee divided drugs into different categories, and suggested that the first two categories should not bear Purchase Tax. That is the impression I have, but if I am wrong perhaps the Financial Secretary will advise me.

It seems that this was a method, or at least an attempt, to bring some order into this confusion, but I would suggest that it inevitably in itself creates another form of confusion. It means that these preparations which are not in categories 1 and 2 carry a sort of stigma because they are not free of Purchase Tax. At least, that is what some people think. By the way, I should tell the Committee that I have a personal interest in the matter, because I have an interest in a firm of manufacturers of drugs and medicines. This does not make me any more knowledgeable than otherwise I would be, or any more knowledgeable than anyone else in the Committee on this matter; but is customary to declare an interest, and I suppose that I do not know any the less for having this particular interest.

The situation, therefore, is that the drugs in the categories not exempt from Purchase Tax have, rightly or wrongly, may be considered to be inferior, because they have not received the stamp or hallmark of their quality. This is probably a wrong impression, but it does exist. When one looks at what has happened in extenso, it is very easy to find some very gross anomalies. I will not repeat what has already been said, how Group 33 is subdivided in Notice 78B, which is relevant to our discussion, and there are some very interesting things in it.

First, amongst things chargeable, I notice worm cakes. On the opposite side of the page, as non-chargeable, we see cocoa powder and chocolate. The cocoa powder, the chocolate, and the drug that destroys the worms are not, by themselves, chargeable, but if the drug is covered with chocolate or cocoa powder it becomes a worm cake and becomes chargeable——

Does not the chocolate powder make the worm?

Perhaps it catches the worm?

Yes, it is a bait, to make the worm eat the drug.

On page 4 of this interesting notice I see that medicated plasters are chargeable, and that means that medicated rings or plasters, of whatever material, for the treatment of all corns and bunions become chargeable. These really are articles that people rightly use by way of self-medication, if one might use the term. Some forms of self-medication are wrong, dangerous, because people not knowing better, may, by using them, become desperately ill before seeking proper treatment.

That cannot be said of the treatment of one's corn or bunion, and it seems rather absurd that because a ring is put round the corrosive material that will soften the corn, the pad or plaster becomes chargeable. Even the mustard leaf on a bandage becomes chargeable, whereas all ordinary forms of bandages, lint, etc., are not chargeable. One finds it hard to see the logic in all this. Nor do I like to see medicated soaps for the treatment of skin conditions being made chargeable.

Again, it seems incredible to me—and I am sure that the hon. Member for Kidderminster will find this interesting—that a farmer may purchase sheep dip and warble fly dressing to rid his sheep of infestation, but that if any hon. Member or citizen suffers an infestation of the scalp by lice, parasites, and so on, he must pay tax on any material that he uses to rid himself of his own infestation. Nobody can maintain that that is very sensible.

There are about 350 to 450 so-called simple drugs that are chargeable. Many of them are very complicated drugs, which no ordinary person would dream of buying because he would not know what they were and probably would never have heard of them. One is called diethyl leneglycolmonoethylether. I do not really think that it is at all likely, Sir Charles, that you would be tempted to buy an excessive amount of that. I have not the vaguest idea what it is for, so it is very unlikely that either you, or the average citizen, would know. Another thing on which one can be called to pay tax is uranium acetate. It may be that the Treasury wants to guard us against the sinister motives of citizens seeking to supply themselves with a uranium compound.

What are we to do about this, and what advice are we to give to the Financial Secretary? It does not seem to me that the contentions and arguments used by the hon. Member for Kidderminster are by any means completely valid. To argue that because the Tory Party in 1948, divided the House on this issue, must mean that after a lapse of ten years—when so many changes have occurred, some for the better and some for the worse—the present Government must abide by what they then tried to achieve in opposition is, I think, wrong, and shows a failure to understand the way we debate in this House, and what we have in mind in debates of this description.

I am indifferent as to whether or not the hon. Member divides the Committee, and I do not say whether or not I shall support him—he will have to take the chance himself—but one or two things are certain. When we must have revenue, we have the right to tax substances which, though available under their own proper name, are offered to the public, much more expensively, under another name. Therefore, all drugs or medicines which are advertised to the public at large in that way—especially when we have the National Health Service—should be looked at as being right for tax, if tax has to be imposed.

For the rest, I frankly think that there are so many anomalies that both the Minister of Health and the Treasury should look at them. How they can be straightened out, I do not know. Of course, if we were to do what the hon. Member for Kidderminster asks there would be no anomalies, but there would be much unfairness and injustice. I am told that if one spends enough money, one can so advertise bottles of clear water as to get a very high price for them, and we know that vast sums are poured out in advertisements in this industry so as to sell the product.

Here, I am speaking of advertising to the public generally. We should protect ourselves. I remember that when I was a young medical student my surgical tutor—later Lord Moynihan—described how rich was his neighbour, who was the man who, among other things, had invented and marketed Zambuk, and who lived next door to my tutor in a much bigger house. My surgical tutor said that his neighbour had made £1 million from Zambuk, which was, I think, boracic ointment with some green colouring matter added. The strange thing was, that like anything else, it would cure some people of some things when every real remedy had failed. These things happen in life.

I therefore hope that the Treasury will look again at this matter, consider it carefully, and try to bring a little more order into the obvious and gross anomalies, and the chaos that exists, but I am sure that if the Government were to seek to remit taxation on proprietary goods advertised to the public at large, the majority of the House would be completely against them.

After the very well-informed speeches of my hon. Friend the Member for Kidderminster (Mr. Nabarro) and the hon. Member for Stoke-on-Trent, Central (Dr. Stross), not a great deal remains to be said, but, first, I should probably declare an interest. Although I have no financial concern with the medicine trade, I am secretary of the Pharmaceutical Society.

When my hon. Friend was talking about the debate in 1948 he seemed to suggest that there was likely to be a certain amount of inconsistency in the support of and opposition to his Amendment today. I think, however, that if he had looked a little further he would have found that steady consistency that we always have, which is that the Government take the same view today as did the Government in 1948, and the Opposition today take the same view as the Opposition took in 1948, which seems to be an admirable example of consistency——

My right hon. and hon. Friends feel upset that the hon. Gentleman should arrogate to his hon. Friend the Member for Kidderminster (Mr. Nabarro) the title of Her Majesty's Opposition. We regard ourselves, far the time being, at any rate—and for not too long, we trust—as the Opposition. We are not taking the same view on this as did the Opposition in 1948, so the hon. Gentleman really must not identify his hon. Friend with the Parliamentary Opposition.

When one looks at the Notice Paper, one finds it difficult to separate the Opposition from supporters of the Government.

The great advantage of a brief debate such as this is that it enables Treasury Ministers to look at certain sections of the incidence of Purchase Tax and consider whether their administration is working satisfactorily or not. Among the many anomalies and injustices of the working of the Purchase Tax system this little group of substances probably shows as many as any other.

As was pointed out earlier by my hon. Friend, we have at present a list, published by the Ministry of Health, of expensive drugs, and of what one might call life-saving drugs, that are exempt from Purchase Tax. Then we have certain other medicines which, provided they are put up in a form not suitable for sale to the public but for use only in dispensing, are also exempt. The result is that, roughly speaking, the public do not pay Purchase Tax on any medicines supplied through the National Health Service, or on those medicines supplied privately on prescription, where the patient pays for the prescription. Nevertheless, Purchase Tax is still paid by the public on the general run of proprietary medicines bought over the chemists' or the grocers' counter.

In the administration of Purchase Tax, the question that the Treasury must ask itself is: are drugs and medicines a suitable item for taxation? I should have thought that, in principle, the answer would be, "No". Traditionally, we have taxed medicines for a couple of hundred years, but the original tax was only on the secret medicine. If a manufacturer kept his formula secret, he had to pay a tax. That dates back to the eighteenth century. Now that, by law, the contents of every medicine must be disclosed on the label, I would have said that that tax—which, after all, is a tax on ill-health—is something that is very difficult to justify——

Is it not the fact that the very same proprietary product sold in a dispensing pack will not attract Purchase Tax, whereas if sold over the counter, in a druggist's store, it will attract Purchase Tax? Will my hon. Friend apply himself to that point?

Yes, that is one of the clear anomalies to which I think it is good that the attention of the Treasury Ministers should, from time to time, be directed. I feel fairly certain that the only justification for the continuation of this tax at all is the fact that about £11 million of revenue accrues to the Treasury as a result, but I would have thought that, as it becomes possible to reduce taxation, so this particular taxation, which can be justified only on revenue grounds, should be one of the earliest items to be reduced. That is the object of the Amendment.

I want to ask my hon. and learned Friend the Financial Secretary the simple question: has not the time come when some of these anomalies and injustices that run through the whole field of Purchase Tax on drugs and medicines should be brought to an end? It can be done by the gradual extension of the list of exempted medicines; it can be done by a reduction in the rate of tax, as the Amendment proposes, but I should have thought that this particular item stood very high among those that compete for priority in the reduction of taxation.

It would be a great pity if proposals on the Notice Paper during the Committee stage of the Finance Bill for reducing Purchase Tax were always decided in advance by the Treasury as a matter of principle, before our debates began. I should have thought that we could with advantage have had a little more elasticity on the part of the Treasury and perhaps a notional sum of money put aside for the reduction of Purchase Tax and decisions taken not in advance but as the debate proceeded, as to whether allocations from the notional sum could be made for specific purposes. If that could be done, a very high priority should be afforded to these items.

Surely the hon. Member will recall that that procedure was followed during the Committee stage of the 1948 Bill.

I did not follow the argument of the hon. Member for Kidderminster (Mr. Nabarro) in respect of the Guillebaud Committee recommendations and how they would affect the position under the Amendment. I would appreciate it if he would draw my attention to the recommendation which so argues.

I did not say that there was a recommendation in the Report of the Guillebaud Committee. I inquired of the Treasury Bench—it was a very valid point—whether the Government's views on Purchase Tax on proprietary drugs and medicines had in any way changed as a result of the admirable recommendations made by the Guillebaud Committee. That is entirely different.

I congratulate the hon. Gentleman on his subtlety. However, I want him to direct his attention to a recommendation on page 256 of the Report, to which he was no doubt making an allusion. It reads:

"… patients, in their turn, should, as far as possible, be educated out of the 'bottle of medicine habit'."

Probably the hon. Gentleman was referring to that recommendation.

That is an excellent argument against the idea of self-medication. Yet that is precisely on what the hon. Gentleman has been basing his argument. He has said that the right of self-medication must be preserved and that taxation of this kind ought not to infringe it. It is a dangerous right in many ways. Whether the right hon. Gentleman applies it to himself in his hygienic—[HON. MEMBERS: "Not right hon."] I apologise for calling the hon. Gentleman a right hon. Gentleman; I realise that that is not accurate even in anticipation.

It is rather dangerous to argue the question of extending the field of self-medication. The hon. Member for Putney (Sir H. Linstead) will no doubt agree that there are many dangers in widening the use of drugs to ordinary persons who resort to them without medical advice. When the hon. Member for Kidderminster argues the case for the use of these drugs in respect of minor complaints, he does not realise the many tragedies which doctors find have occurred to persons who have treated themselves for so-called minor complaints and arrive in the surgery far too late for anything to be done. It is one of the great tragedies of medical practice. I should prefer that people did not resort to self-medication at all rather than to too much of it. That is why, while I am not arguing that we should impose penal taxation on drugs in order to cut down self-medication, I feel that the hon. Gentleman ought to keep the matter in balance and perspective.

While I do not wish to take sides at the moment—I should like to hear the other side of the argument—I feel that it was wrong of the hon. Gentleman to imply, however unintentionally, that the Guillebaud Committee blessed his Amendment or that self-medication was such a sound argument to be used in a matter like this.

I think that the danger of self-medication would be appreciated by my right hon. Friend the Member for Kidderminster (Mr. Nabarro) and all of us who support the Amendment. The matter has to be treated reasonably. I think that the danger of preventing self-medication would be equally great. I recall words used by the late Lord Dawson of Penn in a statement that he made in 1939:

"Perhaps as a member of the medical profession I ought not to sit down without making perfectly clear that I am not against proprietary medicines as such. I think there are a very large number of proprietary medicines which are harmless, and, further than that, that there are some proprietary medicines which are very efficacious, and anything which would unduly restrict their use would be against the public interest."

It is in that sense that I hope that my hon. and learned Friend will be able to declare the Treasury's attitude.

We are not concerned so much that my hon. and learned Friend should accept the particular Amendment put forward. We want to know whether the Treasury takes the view that these drugs are wholly undesirable and, therefore, should be taxed. We reject that view. It has been estimated that acceptance of the Amendment would cost about £5½ million a year, because it would be a halving of the present tax income. I submit that most of the tax is levied not on some of the more expensive proprietary medicines but on the less expensive proprietary medicines which have established their value over a very long period and now command a very large sale.

That kind of medicine is used particularly by the person faced with a sudden slight ailment or injury, for he knows that that medicine has been demonstrated over a long period as a reputable one and one which can relieve or, in some cases, cure his ailment or injury. The Treasury should take the view that that is preferable to such a person going immediately to a doctor and placing yet another burden on the medical profession and the National Health Service.

That is the point that we ask my hon. and learned Friend to consider. That is the point on which he should state the Government's view. We feel that medicines used in this way ought not to be subject to this kind of taxation. While we accept the view that a concession of £5½ million could not be entertained in the light of the background of the Budget, we hope that my hon. and learned Friend will be able to say that this is an object which the Government will have in mind as they progressively reduce taxation and that they contemplate the application of this principle in the very near future.

I did not propose to join in the debate about drugs and medicines, but we are discussing with the present Amendment the one which deals with stationery and office requisites other than furniture and machinery.

It is not obvious at first sight what the connection is between patent medicines and office stationery, but they have one thing in common, which is that at present they are subject to Purchase Tax at 30 per cent. Since they share that identity, it is apparently convenient that the two Amendments should be discussed together.

The hon. Member for Kidderminster (Mr. Nabarro) has put forward arguments for reducing Purchase Tax from 30 pet cent. to 15 per cent. on drugs and patent medicines. He has done it admirably, and for reasons which I have no doubt he will support in the Lobby. I hope I shall have his support in the somewhat similar arguments that I am putting forward about Purchase Tax on stationery and office requisites. No hon. Member can study the law relating to Purchase Tax without very considerable enlightenment and profit. In fact, the more one studies it the more mystified one becomes as a result of not merely the anomalies, but some of the complete absurdities in it.

Let us now turn to consider some of the refinements of the provisions of Group 34 (b), in respect of which we should like to see the Purchase Tax reduced from 30 per cent. to 15 per cent. I do not think that hon. Members will be able to appreciate the arguments for our proposition unless they are reminded of the articles which are included in Group 34 (b). The explanatory memorandum, Notice No. 78, gives some very detailed illustrations of the kind of goods which are now subject to Purchase Tax at 30 per cent. There is, first, notepaper and other stationery, paper and cards. I need hardly say that at the moment we are not dealing with such specialised kinds of literature as greetings cards and Christmas cards; we are dealing with ordinary material on which writing, whether in ink or type or print, appears.

We are dealing with writing, typewriting or duplicating paper, provided that it is of a size less than 229½ square inches in area; that is to say, 17 inches by 13½ inches in area. As my hon. Friend the Member for Oldham, West (Mr. Hale) appreciates, totally different considerations arise when one conies to a piece of paper which exceeds 229½ square inches in area. These provisions apply irrespective of the purpose for which the writing paper is used.

I follow what my hon. Friend the Member for Islington, East (Mr. E. Fletcher) says about paper 229½ square inches in area. I appreciate that if it went to 229¾ square inches in area it might be a disaster. But I do not follow—here I should be grateful for his help—why a memo pad must be 1½ inches by 3 inches at least and not more than 9⅞ inches by 12⅜ inches in area, and if it is below one it attracts tax and if it is above the other it attracts tax. G. K. Chesterton said that the only decent and sensible way of making notes was to lie on one's back in bed with a long piece of chalk and write them on the ceiling. It has always seemed to me that that is one of the ways in which one can impress a thing on one's mind in comfort and decency.

I am very much obliged to my hon. Friend. I will do my best to enlighten him on the very relevant point which he has introduced. I think he will find that if one uses either a crayon, other than a true pastel, or a piece of chalk to write on a bedroom ceiling one has to pay 30 per cent. Purchase Tax on the crayon or chalk, but if one uses a true pastel to make one's notes on the bedroom ceiling while lying in bed, apparently one is not subject to any Purchase Tax.

It seems to me that this is a differentiation introduced for the benefit of those who write on bedroom ceilings with true pastels. Why that should be so I do not know, but no doubt that is something that we shall be able to elucidate. Probably the more important point with which my hon. Friend is concerned is the relevance of pieces of paper of the size 1½ inches by 3 inches and 9⅞ inches by 12⅜ inches. I agree with my hon. Friend that one almost needs a magnifying glass to be sure that one is reading this document intelligently.

I am sorry to interrupt my hon. Friend again, but what I am interested in is blotting paper, because there are so many blots on my book that I have to use rather an excessive amount of it.

Blotting paper is covered; all kinds of blotting paper, I think.

My hon. Friend will also appreciate that not only printers' cards but printers' blanks as well as blotting paper and carbon paper are covered, and, as my hon. Friend suggested, blotting paper is taxed at 30 per cent.; blotting paper, whether in roll, or flat, or in cut sizes; and not only blotters, but music manuscript paper as well.

This is really one of the most comprehensive Schedules in the whole of the Purchase Tax. It covers a very wide range indeed. For example, it includes pencils, including slate pencils, pens, including fountain pens, crayons and chalks, pen nibs, including fountain pen nibs, penholders and pencil holders.

The most extraordinary distinction is made with envelopes. Is the Committee aware that ordinary envelopes are subject to tax at 30 per cent.? One might well have thought that it would have been common sense, if there has to be Purchase Tax on envelopes at all, to have placed it on all of them. But that is not the case. Certain envelopes are exempt from the Purchase Tax, for example:

"Seed, counter and other envelopes for the packing of goods, if prominently printed on the face and identifiable as such, and not suitable for postal or office use."

Further, charity collection envelopes are exempt if clearly identified. What is more surprising is this. Unprinted pack- ing envelopes are exempt provided that they are

"smaller than 4 inches by 2¾ inches in both dimensions"

Imagine the ingenuity involved, if one is a producer or seller of envelopes, in trying to bring oneself within the exemption of Purchase Tax on envelopes.

Then I notice, though I do not understand, that photographic envelopes are exempt but only if of light-proof black or red paper.

Not blue?

Not blue paper. Why that distinction is made is not clear.

Even more curious features occur in this group. We all know what takes place at election times. One notes this anomaly, that ballot papers are subject to Purchase Tax at 30 per cent.; on the other hand, election addresses and ballot cards are exempt from Purchase Tax. What could be the merit of levying Purchase Tax on ballot papers I do not know. Ballot papers are used by the State in Parliamentary elections and by local government authorities in local government elections and, broadly speaking, there are no users of ballot papers except for public official business.

And trade unions.

There may be special cases. For instance, I do not know whether the 1922 Committee has ballot papers.

However, it does seem to me odd that ballot papers should be subject to tax at 30 per cent. Voting by ballot is of the essence of democracy. It is one of the things that we really are trying to maintain by this Finance Bill, and it is not often that we have an opportunity of stating the case for freeing ballot papers from the Purchase Tax. That would be one of the incidental but also one of the most important changes effected if the other Amendment were carried.

The Committee will have observed that practically the whole range of these articles in Group 34 (b) enter into almost every kind of commercial, industrial and social activity. This tax is a tax on literature, a tax on writing, a tax on scholarship, a tax on knowledge. It is an imposition directed to penalise those who write letters. I cannot imagine anything less defensible. I should have thought that, in this age of civilisation and advancement, just as we exempt printed books and literature from tax, so we should have wanted to encourage the use of writing materials, pens, pencils, fountain pens and letters.

I do not know whether my hon. Friend will mind my helping him again—I am sure that he will deal with this more emotionally than I can—but the really criminal thing about this is that there is Purchase Tax on wedding cake bags and nothing on decrees nisi.

I am sure that my hon. Friend has analysed this in much greater detail than I. Is there a tax on wedding cakes? Certainly, on wedding cake bags, but I am not sure that he is right that there is no exemption in respect of a decree nisi. Why should such documents be charged with Purchase Tax at all?

There is the Rent Act.

Yes, but why should medical records and temperature charts be? I should have thought that the hon. Member for Kidderminster (Mr. Nabarro) would have been at least as anxious about reducing Purchase Tax on medical records and temperature charts as he is about reducing Purchase Tax on proprietary drugs and medicines, because medical records and temperature charts enter into the whole apparatus of every hospital.

Guillebaud.

The National Health Service could not be conducted if it were not for medical records and temperature charts. Why, therefore, penalise the National Health Service by placing Purchase Tax on the most commonplace ingredients which they have to use every day in every hospital?

That is not the end of it. There is tax on blank stamp albums whether with plain or ruled pages and

"whether permanently bound or loose-leaf, refill sheets for such albums, and loose-leaf binders for stamp albums of any type."

Why penalise those minded to collect stamps and to put their collections of stamps in stamp albums?

It seems to me that this Schedule not merely imposes a quite harsh and undue penalty on the whole of industry and commerce, but on every desirable form of educational effort. For example, requisites for typewriters and office machinery, blank cylinders for dictating machines, inked ribbons whether on spools, or in cut lengths, or in bulk, type for office printing, embossing or perforating machinery, developing fluids, and

"obliterating and other preparations of the kinds used in connection with office printing and duplicating".

Every possible kind of article used in every office in the country labours under this pernicious tax at 30 per cent.:

"drawing pins, paper clips and fasteners; sample bags of cloth with labels attached…adhesive stationery requisites…adhesive paper…date boxes…Letter sealing waxes"—

I do not want to weary the Committee——

Hear, hear.

—by reading this long Schedule. The burden of my complaint is that this is an imposition on this wide range of articles daily used in every office, in every home, in every school. The tax should be reduced from 30 per cent. to 15 per cent. as one stage in a general campaign to abolish it altogether.

I regard subjecting this range of articles to Purchase Tax as wholly unjustified. I believe that public opinion is against it, and I hope that we shall hear from the Chancellor that he is prepared to give us an assurance that tax on goods in this class will be drastically reduced from the present rate of 30 per cent.

The hon. Member for Islington, East (Mr. E. Fletcher) has mentioned a very wide range of articles in the Schedule. I want to refer to only one. He addressed a query to the Committee about practice in the 1922 Committee and the use of ballot papers and envelopes. I can answer that without any risk either of breaking the rules of order or of being guilty of a leakage of the proceedings of that Committee. I would say without any hesitation that the solid unanimity within that Committee, born of the reasoned conviction of each and every one of its members, in support of the Conservative Government, has entirely obviated the need for any ballot papers in the conduct of its proceedings.

I address myself more particularly to the Amendment which has been so ably moved by my hon. Friend the Member for Kidderminster (Mr. Nabarro). I am strongly in support of it. Neither he nor any subsequent speaker has made it clear to the Committee that the drugs and medicines subject to Purchase Tax are not restricted to those which are used for human consumption. The National Farmers' Union has represented that the abatement is highly desirable at this time of the tax on drugs and medicines used by farmers in administering to their animals, sometimes, of course, as a direct prescription or order by a veterinary officer, but by no means always.

If the case can be made out, as I think it can, that every time a human being wants a dose of medicine he does not need to go to a doctor to get a prescription for it, then the case is even stronger when applied to farmers and their animals. Perhaps the farmer is a small man who is anxious to restrict as far as possible his bills for outside expenditure and fees on veterinary officers.

Being quite sure of the symptoms some of the animals have developed, and certainly being able to administer medicine to them, he will be the direct purchaser without prescription of the medicine, and will have to pay, under existing conditions, Purchase Tax upon it. It is at present the policy to assist, if methods can be devised, not only farmers but especially the small farmers, and I think that a reduction of Purchase Tax on these veterinary drugs and medicines would be a very definite way of assisting the small farmers at a time when they are not able to make very great profits. Therefore, I strongly support this Amendment, affecting, as it does, the administering of medicine to animals.

I support my hon. Friend the Member for Islington, East (Mr. E. Fletcher) in his comments on the Purchase Tax on stationery. It is the sixth or seventh time since 1945 that I have had to criticise the Government of the day for that. My right hon. Friend the Member for Battersea, North (Mr. Jay) has had to reply on behalf of the Government on more than one occasion on this matter. It is a subject on which there is almost complete unanimity outside the Front Benches. We shall never find a back bencher to support the present tax on stationery. It affects every man, woman and child.

4.45 p.m.

It was a tax imposed, I think, largely as a result of misunderstanding. Originally, the object of Purchase Tax was to reduce consumption during a period of shortage. It was a wartime Measure, but in later years it extended somewhat beyond the original concept. However, apart from its revenue-raising effect, it still has some elements of that original motive behind it. My hon. Friend the Member for Islington, East (Mr. E. Fletcher) referred to printed envelopes. The method he referred to was introduced by the Customs and Excise to prevent direct taxation of production.

The tax was a misconception from the very first; it always was a retrograde feature of the Purchase Tax. It did not restrict consumption. In fact, consumption of the taxed items of stationery inevitably increased in many ways in wartime conditions through the necessity to fill up more and more forms in industry, commerce, local government and so forth It is a tax which cannot be regarded as having much effect upon the ordinary private consumer. It now yields nearly £40 million, of which the private consumer contributes about £2 million. Thirty million pounds come from industry and commerce and the other £8 million come from education, administration and the rest. Those are round figures.

The oncost added to goods subject to the tax amounts to £30 million, plus a good deal more. There are the wages and salary cost involved in administering it, and there are very often further additions on top in both wholesale and retail distribution. It was, I think, orginally the only Purchase Tax of any consequence with a definite effect upon the costs of industry. Abolition has been advocated by the Federation of British Industries, by the National Chamber of Trade, and by the trade unions concerned in the printing and allied trades. They have all shown a remarkable unanimity throughout about this tax.

I had thought that the Government posed as the businessman's Government, as a Government anxious to reduce the costs of production. They said that they were anxious to help industry. This is one of the taxes which should have caught the eye of the Treasury Ministers first of all in looking at the Purchase Tax from the point of view of reducing the costs of industry and commerce in general, and, to a small extent, the costs of the private individual. Just as important, relatively, is the cost of administration, both central and local.

Although nothing can be done this afternoon in this respect, it is very important that the Government, in considering any further reduction in the Purchase Tax or its abolition, should take this as one of the first items needing attention. My contention is that this Tax is more important than the tax on drugs and the many other things which have been mentioned in recent debates.

It has been a fundamental fallacy of the Government of the day from 1940 onwards that this Purchase Tax had a reducing effect upon consumption. In fact, it was a tax on production. It was a tax on industry. It did not matter at all during times of paper shortage, but in the competitive conditions with which the country is now being faced, although it is relatively a small item, it is an important one in our costs of production, distribution and administration. I hope that the Chancellor of the Exchequer and the Financial Secretary will very carefully consider what should be done about it in the days to come.

I support all that my hon. Friends have said about the tax on stationery. My view is largely determined by the effect of the tax on stationery used not only in industry but in our schools. Perhaps the Financial Secretary will be able to explain why rubber stamps are not charged but the pad on which one puts a rubber stamp is charged. This seems to be an anomaly.

As regards drugs, could the Financial Secretary tell us why there is included in the list of things which are chargeable protective barrier preparations specially prepared for use in factories solely for the protection of the skin against occupational dermatitis. When we are doing so much in our factories to try to prevent this occupational disease, which can be a very distressing and protracted one, it seems quite wrong that we should charge to Purchase Tax such a product.

Stoke-on-Trent Members are usually found to be wholly in agreement in the House. The motto for our City is: "United Strength is Stronger." I have, however, one difference of opinion with my hon. Friend the Member for Stoke-on-Trent, Central (Dr. Stross). I find it very difficult to understand why a drug which is nationally advertised should, according to his recommendation, be charged, whereas the simple aspirin should not be charged to Purchase Tax. A tremendous amount of money is spent on the nationally advertised drugs. One very large company, which used to advertise that its product was worth one guinea a box, during the last four years has doubled its 100 per cent. bonus to its shareholders and has paid out a dividend increased from 25 per cent. to 32½ per cent.

Will not my hon. Friend agree that she has now answered herself?