asked the Chancellor of the Exchequer whether he will now establish a technological university in Great Britain on the lines of Massachusetts Institute of Technology.

No, Sir. It is the policy of the Government to look to the existing universities, university colleges, and colleges of advanced technology to set patterns of development. Full-time higher education in all its aspects will be considered by the Committee of Inquiry of which, as the hon. Gentleman will be aware, Lord Robbins has recently been appointed Chairman by my right hon. Friend the Prime Minister.

Has the Financial Secretary seen the announcement by Sir John Cockcroft that we shall need something of the nature of an M.I.T. university in addition to the existing plans of the Government in the next ten or fifteen years? What has he to say about that?

I have seen that observation. I think that, now that this highly important Committee of Inquiry has been appointed, this is obviously one of the important subjects which will come within its purview. It is worth remembering that the University Grants Committee envisages that two-thirds of the places in the enlarged university buildings programme announced on 25th January will be occupied by students reading science and technology.

Will the Minister bear in mind that the German experiment in technological universities, where they have eight of these universities producing 50,000 graduates annually, has been extremely successful? Is not there something to be said for a system different from the ancient form of university structure, and more appropriate to technological research, organised on similar lines to the institutes in America and Germany?

Yes, Sir. I am quite sure that the Committee of Inquiry will wish to consider the experience in all parts of the world. But I think that hon. Gentlemen will agree that the pattern of university development appropriate for one country may not be appropriate in exactly the same form for another country.

asked the Chancellor of the Exchequer whether he is aware that certain inspectors of taxes admit, as part of maintenance relief claims against Income Tax Schedule A submitted by owner-occupiers of houses, the cost of replacement of dustbins or other such refuse receptacles, and the cost of hiring such articles from a local authority, whereas other inspectors of taxes do not so admit; and whether in the interests of household hygiene and domestic cleanliness and to establish uniformity of practice, he will give directions that the cost of all dustbins and similar receptacles as replacements, and the cost of hire, shall be admissible for appropriate relief.

No, Sir. Dustbins do not form part of the property assessed under Schedule A and the cost of replacing or hiring them is not allowable in a maintenance claim by an owner-occupier.

If that is so, why are certain inspectors of taxes allowing these refuse receptacles, whether hired from the local authority or bought, as part of a maintenance relief claim? Having regard to the confusion which exists about what are allowable items and what are disallowable items under a maintenance relief claim against Income Tax Schedule A, would not my right hon. Friend consider instructing the inspectors of taxes to enclose in the envelopes carrying the Schedule A assessment a detailed list, in proper form and carefully categorised, of all the items which are admissible and those which are not? Some of us are not as clever as others, Mr. Speaker.

Hear, hear.

That last point had not escaped me. I will certainly consider the suggestion my hon. Friend has made.

I will draft it for them.

Some inspectors may have passed small items like this, but the principle is clear, and I am glad that my hon. Friend has given me the opportunity of reaffirming it.

asked the Chancellor of the Exchequer what would be the loss in revenue if all rates of Surtax were halved.

On the basis of last year's Budget estimate £95 million.

Without prejudice to anything which may or may not appear in the Budget statement of my right hon. and learned Friend, may I ask my hon. Friend whether he thinks that a reduction in this high level of Surtax might help to encourage the development of maximum efficiency in the sphere of technology and management?

I had better not say what I think on that subject at present.

asked the Chancellor of the Exchequer if he will make arrangements to ascertain how many underground workers in the mining industry pay Surtax.

I do not think that a special inquiry for this purpose would be justified.

Why not? Should we not be armed with these figures in order to see how many of our constituents are likely to benefit if the rate of Surtax is reduced?

No, Sir. With respect, the hon. Gentleman is falling into the old Marxist fallacy that labour power is the sole source of value. We shall not earn our living in the world unless we not only extract things but manufacture and also sell them, and I think that a special inquiry of this kind would not be worth while.

When the right hon. and learned Gentleman is ascertaining these figures, will he bear in mind the contribution that the mining community makes to the nation, and see that there is an improvement in any position that he does discover?

asked the Chancellor of the Exchequer what are his proposals for raising the starting point for the imposition of Surtax to £6,000.

I cannot express a view on this proposal before the Budget.

Does that mean that the hon. Gentleman is reluctant to agree with the proposal that has been made in this connection? Does he realise that his reply will come as a shock in certain quarters of the House, but that I would regard the reluctance of the Treasury to proceed in this undesirable direction as a unique example of its intelligence and commonsense?

That is very flattering, indeed, but, while we all respect the hon. Member for Bosworth (Mr. Wyatt), he is not Chancellor of the Exchequer.

asked the Chancellor of the Exchequer whether he is aware of the mounting public interest in the possibility that, after long delay, the National Theatre will be built on the site allocated on the South Bank; and when he will make an announcement about this.

asked the Chancellor of the Exchequer whether he is now in a position to make a statement on the proposals for a National Theatre to be built on the South Bank.

asked the Chancellor of the Exchequer, if he is now in a position to make a statement about the National Theatre.

My right hon. and learned Friend appreciates the interest taken in this matter on both sides of the House and has asked me to say that he will inform the House of the Government's decision as soon as he is in a position to do so.

Would the Financial Secretary be good enough to inform his right hon. and learned Friend that not only is there interest on both sides of this House but in all parts of the country in this matter, that the country has waited about a hundred years for this statement in reality, and we should very much like to have an affirmative answer upon it?

I quite appreciate the widespread interest. Of course my right hon. and learned Friend is as anxious as anyone to proceed to an early decision, but the subject is a large and rather difficult one and the Government must be sure that their decision is the correct one.

Would my hon. Friend be willing to receive further representations on this subject?

I should certainly be prepared to see my hon. Friend and any other hon. Members, on either side of the House, if they would like to come to see me.

Is the Financial Secretary aware that this long continued and unnecessary delay in making up the mind of the Government on this question is building up their reputation for meanness and mediocrity? Are not the Government being put to shame in this matter by the imaginative and progressive policy of the L.C.C. in developing the South Bank?

I do not consider that the Government's record of support for the arts generally, in comparison with that of any previous Government, can be considered all that mean. In other respects, I do not think I can add to what I have said.

When the time comes when the Government feel able to give more money to art, will they consider, not putting it into bricks and mortar, but making it available to our provincial repertory companies, from whom and among whom so many of our leading dramatists have made their successful beginnings in their profession?

That supplementary question goes rather further than the Question on the Order Paper, but my hon. Friend will recall that last year's grants to the Arts Council resulted in considerable extra money for provincial repertory companies.

asked the Chancellor of the Exchequer what representations he has received for a reduction in the rate of tax on Derv fuel oil.

My right hon. and learned Friend has received such representations from the Joint Fuel Tax Committee for the Passenger Road Transport Industry as well as from some other sources.

Is the Minister aware that it is this tax of 2s. 6d. a gallon, or 200 per cent. of the basic cost, which has been responsible for the steady contraction of bus services and the increase in bus fares? Is it not a shocking anomaly that, while oil for other purposes is entirely tax-free, oil for bus services is burdened with this heavy tax?

I am afraid that I cannot accept what the hon. Member says, but I am sure he will be pleased to know that tomorrow, on my right hon. and learned Friend's behalf, I am receiving a deputation from the Joint Fuel Tax Committee.

asked the Chancellor of the Exchequer if he will investigate the circumstances under which duty and Purchase Tax were levied by Her Majesty's Customs on Mr. R. E. Rushen and another British survivor of the Mexican Airlines crash on their arrival at London Airport on 25th January.

asked the Chancellor of the Exchequer if he will make a statement on the circumstances in which two British survivors of an air crash in the United States of America were delayed by the customs authorities at London Airport on 25th January last.

asked the Chancellor of the Exchequer whether he is aware that two British businessmen who survived the airline disaster at Idlewild Airport in New York on 19th January were charged a substantial sum of money in respect of duty and Purchase Tax in connection with the clothes which they had been obliged to purchase in New York to replace items in their luggage which had been destroyed; and whether it is proposed to issue special instructions to deal with cases of this kind in the future.

The articles declared to the Customs by these two gentlemen were well in excess of the tolerances normally allowed, and duty and Purchase Tax were properly charged. There is no exception for replacement articles as such, but charges were not, in fact, made on any clothing which had been worn or was being worn. Because of the substantial numbers of articles declared the Customs examination took about twenty minutes, but in the special circumstances of the case the wives and friends of the two passengers were allowed to join them in the Customs hall during that time. All possible consideration was shown by the Customs, and there is no need for further investigation or instructions.

Does my hon. Friend appreciate that many people consider that the attitude of the Customs officers in this case was certainly rather unimaginative? Will he ensure that, in future, exporters who go through these vicissitudes are not exposed to the same type of trouble?

I have made very careful inquiries about this. On the very day on which I saw Mr. Rushen's letter in The Times I called for a report. I am quite satisfied that these two passengers were treated courteously and as sympathetically as possible. Some of the statements in the letter to The Times certainly do not coincide with the information I have been given.

While most people find the Customs officers at London Airport generally reasonable and considerate, was not this a rather exceptional case in which the strict letter of the law need not have been quite so rigorously enforced?

As I think I said, because of the special circumstances of the case, the articles that had been worn or that the passengers were wearing were subtracted from the totals to arrive at the chargeable amounts.

asked the Chancellor of the Exchequer what would be the total Income Tax paid by two single persons each earning £2,000 per annum; and what additional Income and Surtax would be payable if the two individual taxpayers were married.

£986 1s. 01. and £231 5s. 0d. respectively. The latter figure is made up of £270 Surtax less £38 15s. 0d. reduction in Income Tax liability.

Although it was a little difficult to hear what my hon. Friend said, I gather that the tax paid by a married couple will be greater than the tax paid by two single people liable to tax, with incomes of over £2,000? If that is so, why should the Treasury want to encourage immorality? Are not there enough temptations already without a fiscal temptation to live in sin instead of in the holy bonds of matrimony? Will my hon. Friend look at this again before the next Finance Bill?

The simple point is that as a married couple they would pay less Income Tax, but they would become liable to Surtax. We cannot debate the whole question of aggregation this afternoon, but Government policy here is wholly in line with the views of the Royal Commission.

Will my hon. Friend assure the House that, by and large, the Treasury is opposed to sin?

asked the Chancellor of the Exchequer for what reasons radio and television sets, cosmetics and cars are still subject to Purchase Tax at 50 per cent., whereas electrical appliances attract 25 per cent. Purchase Tax, floor covering and pottery 12½ per cent., and clothes and furniture 5 per cent.; what considerations prompted these rates in the current year; and whether it is his policy to continue such fiscal practices involving a radio or television set being taxed twice as heavily as any other electrical appliance and four times as heavily as a carpet.

The reasons were given by my right hon. and learned Friend's predecessor in his Budget Speech in 1958, when he established the present structure of the Purchase Tax. As to the last part of the Question, I cannot anticipate my right hon. and learned Friend's Budget Statement.

Is it not a fact that there is a great deal of difference in calibre and fiscal philosophy between the last Chancellor of the Exchequer and the present one? Are we to suppose that all the policies enunciated by the last Chancellor are to be practised by the present Chancellor and that these undesirable differentials in Purchase Tax—which, for example, cause a radio set to be taxed ten times as heavily as an expensive cocktail cabinet—are to be carried forward indefinitely into the future?

I think that my hon. Friend—I say this with great respect—would be well advised not to suppose what he has just suggested.

asked the Chancellor of the Exchequer what reexamination there has been in the last two years of the level at which delegation of staff numbers begins at the Admiralty; and with what results.

None. I assume that the hon. and learned Member has in mind one of the recommendations of Sub-Committee B of the Select Committee on Estimates last Session, concerning the Admiralty headquarters organisation. This recommendation was accepted with the rider that examination of levels of delegation would require to take account of the circumstances of the other two Service Departments. My right hon. and learned Friend has not yet completed preliminary consideration of what would be the best arrangements for the Service Departments.

Would the hon. Gentleman agree that it costs very much more to employ in the Admiralty a serving naval officer than it does to employ a civil servant in the same job? Is it not, therefore, desirable to have this matter expedited and an inquiry put forward as soon as possible?

I quite agree that, of course, we want to look into the matter carefully, but I think that examination of levels of delegation must take into account all the circumstances in other Service Departments, and I would much rather see this matter looked at fully than that a false and facile conclusion should be arrived at.

asked the Chancellor of the Exchequer what is his estimate of the decline of shipping earnings for invisible exports over the last year, to the nearest convenient date.

The latest available estimates of the net contribution of British shipping to the balance of payments collected by the General Council of British Shipping, show that there was a decline of £35 million in 1959 as compared with 1958. Although the figures for 1960 are not yet available, there does not appear to have been any further decline.

Is it not a fact that there has been a very great decline since 1952, when the figure was more than double? Is this not serious from the economic as well as the national point of view? Will my hon. Friend ask his right hon. and learned Friend to look at the shipping industry sympathetically in view of these figures?

I agree with my hon. Friend that there has been a considerable decline over the years since 1952, and I am sure that my right hon. and learned Friend will take note of what he has said.

asked the Chancellor of the Exchequer what general instructions he has given to ensure that the recent successful operations of Richard Thomas and Baldwins are suitably publicised.

This is a matter for the company and there is no reason why I should intervene. The company's recent report and accounts and the Chairman's statement have already been the subject of a good deal of comment in the Press. I understand that, as is usual for companies of this size, arrangements are being made to publish the chairman's statement, either in full or in an abridged form, in a number of leading newspapers and periodicals.

Is the hon. Gentleman aware that limitations are imposed by the Government themselves on the manner in which Richard Thomas and Baldwins can publicise their achievements? As this is the most successful steel firm in the country and in view of the large amounts being spent by private steel firms to advertise their achievements, does not the hon. Gentleman think that more efforts should be made by the Government to publicise the success of this company?

I do not think that this is a matter for the Government. It is a matter for the company. I understand the original intention was that the facts about the company—the statement made by the chairman, either in full or an abridged form—was to be published today. It is due to certain technical printing difficulties that the publication has been delayed.

As the Government through tax rebates are helping to subsidise the advertisements of some of the privately-owned steel companies, is there not some obligation on the Government to do the same thing for companies which they own?

No, I cannot agree with that.

Can my hon. Friend confirm what has just been said, namely that restrictions are imposed by the Government on advertising by this company? If so, what are the restrictions? Is not it unreasonable and unfair that they should be imposed? Why are they imposed?

I will certainly look into that aspect, but no one has given me notice of any such restrictions. If the hon. Member for Ebbw Vale (Mr. M. Foot) will write to me, I will see if there are any. I know of none.

If the Treasury is the responsible Department as the one that owns these shares, surely the Minister responsible to the House should know whether there are such restrictions?

On the information i have at present, all I can say is that I know of no such restrictions. I assume that the hon. Member for Ebbw Vale must have something particular in mind, and I am willing to look into it.

If the hon. Gentleman will give me an undertaking that when I give him the information about the restrictions he will remove them, I shall be gratified.

I will consider any representations the hon. Gentleman wishes to make.

asked the Chancellor of the Exchequer what representations he has received from local authorities protesting about rates of interest chargeable by the Public Works Loan Board following the recent reduction of the Bank Rate; and whether he will take steps to bring those rates more into line with the Bank Rate.

asked the Chancellor of the Exchequer to what extent, when fixing the rate of interest charged by the Public Works Loan Board, he takes into account current Bank Rate.

asked the Chancellor of the Exchequer if, following the 1 per cent. reduction in the Bank Rate, he will similarly reduce interest charges on housing loans from the Public Works Loan Board and on other loans for council house building.

asked the Chancellor of the Exchequer whether he will assist the local authorities in the new and additional capital tasks placed on them by the Government by reducing the Public Works Loan Board's rate of interest.

Several local authorities have recently made representations about the level of the Public Works Loan Board's lending rates. These rates reflect the cost of local authority borrowing on the market and changes are made whenever alterations in the market rate justify this. The recent trend of market rates has provided no justification for reducing the P.W.L.B. rates. The level of Bank Rate has no direct link with the level of the P.W.L.B. rates.

Is the hon. Gentleman aware that local authorities are complaining bitterly about the adverse effects of these penal interest rates on the activities which the Government have repeatedly imposed on them? The Government have even extended local authority functions, particularly in regard to mental health services. If the Government are serious about this, why do they not give local authorities some encouragement?

As I am sure the hon. Gentleman knows, the Government have made it clear on a number of occasions that we do not think that it is right to insulate local authorities from a general trend of this sort in interest rates by giving them what would in effect be a concealed subsidy.

Is not the hon. Gentleman concerned about the position revealed in the last Annual Report of the Public Works Loan Board, in which it was revealed that the number of loans has fallen catastrophically since 1951? The Report reveals that local authorities are being compelled to postpone, abandon and suspend essential projects in the fields of education, housing and public health.

If local authorities cannot borrow on reasonable terms in the market, they are entitled to go to the Public Works Loan Board.

Is not the Minister aware that the Government themselves have placed upon local authorities new and additional duties in respect of education and local health which will demand considerable capital expenditure? Is not he aware that local authorities throughout the country are in considerable straits because of this? If he wishes the hopes of the House, and even the proclaimed hopes of the Government, to come to anything, he must face the fact that the present high interest rates are militating against the fruition of these plans.

I can only repeat that the present rates of interest are a reflection of the general pressure of demand for capital. We have, time and time again, made our position quite clear, namely, that we believe that as far as possible local authorities should borrow from the market in their own name and on their own credit.

Has the Economic Secretary noticed that President Kennedy intends to combine lower long-term interest with high short-term interest rates?

Why do we have to have him brought into it every time?

Can the Economic Secretary explain, even if the noble Lord cannot, why if this can be done in the United States it cannot be done here?

No, I cannot.

Is the hon. Gentleman aware that council flats costing £2,400 to build eventually cost £9,063 before the interest at the current rate of 6 per cent. has been paid for sixty years? This means that, if there were a reduction only to 5 per cent. it would save £1,470, or 9s. 5d. a week in rent, and 5 per cent. is still 2 per cent. higher than the rate was under the Labour Government.

The hon. Gentleman asked in his Question if my right hon. Friend will reduce interest charges. I have already given him the answer to that. I cannot without notice go into detailed calculations.

Has the hon. Gentleman made any reply to Ayr County Council, which has made representations to him on this subject? Is he aware that the Finance Committee, after an exhaustive review of its public work commitments, finds itself totally unable to undertake them because of the high interest rate charged by the Public Works Loan Board? Will not he try to equalise it to the Bank Rate of 5 per cent. and give local authorities some hope of completing the promises made to the electors during the last election?

The hon. Gentleman has a Question later on about the Ayr County Council. However, I will tell him now that the rate for long-term borrowing has not fallen since the Bank Rate was last reduced.

On a point of order. In view of the extremely unsatisfactory nature of those replies, I beg to give notice that I shall raise the matter on the Adjournment.

asked the Chancellor of the Exchequer whether he will give the figures for the United Kingdom for increases in industrial production for the third quarter of 1952 to the first quarter of 1955, for the first quarter of 1955 to the third quarter of 1958, and for the third quarter of 1958 to the second quarter of 1960; and if he will give, on the basis of statistics available to him through the Organisation for European Economic Co-operation, the corresponding aggregate figures for the same periods for the European Economic Community countries.

As the Answer contains a number of figures I will, with permission, circulate it in the OFFICIAL REPORT.

Do not those figures show that between 1955 and 1958 while this country stood still Europe surged ahead? Is not this a strong argument for ending the credit squeeze now, otherwise the same thing will happen again?

In the economic debate earlier this week I dealt at considerable length with the question of growth. Simple comparisons of the rates of growth of production are certainly no index of economic success.

asked the Chancellor of the Exchequer what has been the percentage decline over 1950 for net receipts by the United Kingdom of interest, profits, and dividends for the years 1957, 1958, and 1959.

50 per cent., 74 per cent. and 48 per cent. respectively.

Is not this a very serious decline indeed, especially as in 1950 this item had not recovered from the war? Does not this show that we are paying an extremely high price at present for the Government's dear money policy?

The hon. Gentleman refers to 1950, which is the base year which he has taken in his Question. It is only fair to point out that payments on the North American loans did not commence until 1951 and in the subsequent years in which payments were made—every year, apart from 1957—they have averaged about £40 million.

asked the Chancellor of the Exchequer what progress has been made in discussions on the start of a cheque service by the Trustee Savings Banks.

I have nothing to add to the reply given to the right hon. Gentleman by my right hon. and noble Friend on 24th May, 1960; we are still awaiting a further approach from the Trustee Savings Banks Association on the basis of the investigations which it has been pursuing in the meantime.

Is the Economic Secretary aware that, as the Government have delayed the introduction of this very desirable public service for over a year, suspicions are bound to grow that they are giving way to pressure from the commercial banks? As we have been extremely patient about asking Questions on this subject, will the hon. Gentleman now undertake to make a definite statement very soon?

The delay has not been caused in the way suggested by the right hon. Gentleman. The fact is that the initiative has been with the Trustee Savings Bank Association for the last eight months. Prior to that, I saw the chairman and other members of the Association, and I shall be only too happy to see them again as soon as they feel that it will be useful to bring anything to my notice.

Will the Economic Secretary ask his right hon. and learned Friend to call his right hon. Friend the Postmaster-General into these consultations and inquiries to see how far he can introduce postal cheques as well?

I think that that is a matter for my right hon. and learned Friend.

Is not the hon. Gentleman aware that it is not altogether true to say that the initiative lies with the Trustee Savings Banks Association? Those banks are, in fact, dependent on what co-operation they can get from the clearance houses, represented by the joint stock banks. Is it not the fact that the joint stock banks are putting many difficulties in the way of the trustee savings banks, because they do not want trustee savings bank depositors to have a cheque scheme at all?

The fact is that I met representatives of the Association on 28th April last. It was then agreed that the Association would have to examine certain aspects, and the arrangement was that they would come back to me when they thought it would be useful to have further discussion. I am quite ready to see the chairman and other members of the Association as soon as they like.

asked the Chancellor of the Exchequer Whether he will give an assurance that iron and steel prior stocks now held by the Iron and Steel Holding and Realisation Agency will not be sold at a discount below the issue price, or disposed of while gilt-edged prices are at the present low levels.

No, Sir.

Is not the Government's persistence in attempting to sell these steel prior stocks at present not only totally unnecessary, but forcing down gilt-edged prices to record low levels, and causing losses of tens of thousands of pounds to a very large number of small investors?

I think that the right hon. Gentleman will agree, for reasons that are readily apparent, that I really cannot enter into any discussion about particular aspects of possible future operations by the Agency.

But cannot the Economic Secretary give an assurance, in the interests of both taxpayers and small investors, that the Government will not sell these stocks while gilt-edged prices are at their present extremely low level?

I cannot make any comment on that.

asked the Chancellor of the Exchequer if he will consider entering into negotiations with the owners for the purchase of the News Chronicle Press Clipping Library, for the purpose of providing a comprehensive central Press clipping service for use by the twenty-four Government Departmental libraries and the Central Office of Information; and if he will make this service available also to the House of Commons Library.

No, Sir.

Is the hon. Gentleman aware that many hon. Members will be very disappointed with that Answer? Does he not think that the work of Government Departments and hon. Members alike would be greatly facilitated by the use of this very fine service, and that, perhaps, the cost might not be greater than that entailed in the necessarily fragmented services provided at the moment for Government Departments? Will he not look again at this matter?

I have looked at the matter again very carefully. I am satisfied that the Central Office of Information has adequate arrangements for the provision of Press clippings. As to the provision of the service for the House of Commons, that is really a matter, in the first place, for the House authorities, but if the hon. Gentleman cares to write to me, or to make further representations, I will, of course, consider them.

asked the Chancellor of the Exchequer how many adult insured employees are currently earning less than £10 per week, how many between £10 and £15, and how many over £15.

I regret that this information is not available.

Is the hon. Gentleman quite sure that 'the information is not available? I put down a similar Question two years ago, I think, and got the information from the Treasury. I think that it would help us in ascertaining the relative degrees of hardship in the community if, in addition to knowing the numbers of people paying Surtax, we also had the numbers of those earning under £10 a week.

No, Sir. For reasons that I am perfectly ready to explain to the hon. Gentleman in correspondence, the information for which he has asked is not available, but I can say that the Ministry of Labour's half-yearly inquiry, held in October, 1960, into the earnings and hours of manual workers, did contain an additional question which enabled the distribution of earnings of men and women working full time to be calculated for the industries covered by the inquiry. The Ministry of Labour hopes to publish this information in the Ministry of Labour Gazette by the middle of this year.

Can the hon. Gentleman say how hon. Members can make an assessment of the effect of the new graduated pensions without that information?

Of course, it is perfectly true that the Government Actuary did publish certain information in Table C of Appendix II to his Report on the National Insurance Bill, 1959, on the earnings of a number of persons in various workers' groups in an average week. That is not quite the same as the information now being asked for, but I will certainly see that as precise information as possible will be available to hon. Members.

asked the Chancellor of the Exchequer what rate of sales tax would be necessary, excluding food and items like alcoholic drink, tobacco and petrol, already subject to other taxes, in order to yield the same revenue as the present rates of Purchase Tax; and what flat rate of Purchase Tax, on the same items, would be required to yield the same result.

About 12 per cent. and 16 per cent. respectively.

Will my hon. Friend say whether, in his opinion, in addition to other difficulties, the cost of collecting a sales tax would be abnormally high?

The question of a sales tax was considered very carefully by my right hon. and learned Friend's predecessor and, in his Budget statement in 1958, he dealt with it at some length and explained why he did not think that a sales tax would be proper.

asked the Chancellor of the Exchequer what negotiations he has had with the United States Government concerning co-operation in order to secure greater uniformity in the interest rates applicable to the United States of America and Europe; how soon London rates will be reduced to the United States level; and if he will make a statement.

My hon. Friend will not expect me to make any statement about interest rates in the future. My right hon. and learned Friend emphasised in his speech on 6th February the importance which he attached to maintaining close contact with the United States Administration on financial and economic matters.

Since the American Government obviously want interest rates to be brought down, not only in their country but in this country, and since the export trade of the world is conducted either in dollars or sterling, surely it is in the interests of the world's export industry that we should have uniformity in these interest rates—and low interest rates? As a corollary, since high interest rates undoubtedly have evil social consequences at home, do not we want to reduce them as soon as we can?

I appreciate my hon. Friend's point in asking this Question but it has, after all, long been recognised that Ministers do not speculate in this House on possible changes in interest rates.

asked the Chancellor of the Exchequer whether, in framing his next Budget, he will make arrangement for those who have suffered long-term sickness to spread their taxable earnings over more than one year.

I have noted the hon. Member's suggestion, but I cannot anticipate my right hon. and learned Friend's Budget statement.

In preparing for the Budget, will the Minister have regard to the problem facing a worker who might have had an illness stretching over, perhaps, twelve months, who has incurred debt, and who has a long period of work ahead before he can again get financially on his feet? As such an arrangement is in operation for certain professional workers, would he not try to extend it to other workers?

I can assure the hon. Member that my right hon. and learned Friend will consider this. I would remind the hon. Gentleman that sickness is only one of quite a number of reasons for fluctuations of income. This is rather a big and, I think, difficult subject.

Can the Financial Secretary tell the House whether the Chancellor of the Exchequer, in his absence from the House today contemplating the Budget, is impaled Scylla or Charybdis?

Answer.

Is the Financial Secretary reluctant to reply, because he fears that he may have the Closure moved on him again?

No. With respect, I really did not think that that supplementary question was worth answering, and I thought that we might get on.

asked the Chancellor of the Exchequer if he is aware of the case of Wilkins, Her Majesty's Inspector of Taxes v. Rogerson in which judgments have been given in the Chancery Division and the Court of Appeal; why this was taken to the courts, in view of the fact that the original decision of the Special Commissioners was confirmed both in the Chancery Division and the Court of Appeal; and how much were the costs, including those of Mr. Rogerson, incurred by the Crown in connection with the High Court proceedings.

Yes, Sir. The Inland Revenue took this case to the courts because an important point of law was involved. The Crown's costs, including those of Mr. Rogerson, were about £900.

Since a person earning £2,000 a year, or a director, however limited his salary, is in no way affected, what is the purpose of taking an ordinary wage earner through the courts on a matter of £5.

In fact, this was a test case on what was felt to be a novel and quite important point. In his judgment Lord Justice Donovan said:

"The case wears an aspect of triviality which is deceptive."

asked the Chancellor of the Exchequer what instructions he has given to his inspectors concerning assessment of tax in cases where a trade of farming is being carried on by a taxpayer on a commercial basis and with a view to the realisation of profits within the meaning of Section 20 of the Finance Act, 1960, and in respect of which the Minister of Agriculture, Fisheries and Food has made or has undertaken to make grants under the appropriate Acts in respect of capital expenditure on the farm by the person carrying on the trade although such trading may result in loss.

I am not clear what is the point about which my hon. Friend is concerned. If he will send me further details, I will make inquiries and write to him.

I thank my hon. Friend for that reply, but, if he is unable to understand this simple Question, how does he expect the taxpayer to understand the Finance Act? Will he, either now or in writing, give me an assurance that when the skilled officers of the Ministry of Agriculture make a capital grant to a farmer, thus recognising him as farming in a serious manner, the farmer will not be exposed to attack by officials of the Inland Revenue?

One thing I can do is to refer my hon. Friend to the very full explanation given by my right hon. and learned Friend's predecessor in his Second Reading speech on last year's Finance Bill, which is reported in HANSARD, Vol. 622, column 892. That is, I think, the clearest exposition of the point that I know.

Will my hon. Friend direct the attention of inspectors of taxes to that and ask them to take the guidance of the officials of the Ministry of Agriculture?

asked the Chancellor of the Exchequer whether he will consult with the University Grants Committee to see that the most efficient and economic use is made of places available at all universities by the provision of a co-ordinated entrance policy and a universities clearing house.

These are matters for the universities themselves, and the hon. Member may have noticed that a report relating to the procedure for admission of students was published this week with the authority of the Committee of Vice-Chancellors and Principals.

But as the Chancellor is responsible for finding the bulk of the money for this purpose, has he not some influence to bring to bear on the universities to deal with this matter expeditiously? Is he not aware that the chance of getting into a university now is almost as slight as the chance of winning the treble chance itself? In view of the increasing numbers of young people who will be anxious to go to university in the next few years, is it not high time that this issue was dealt with expeditiously?

The hon. Gentleman may have noticed that an important new feature of the report to which I have referred is that it recommends the universities to consider the establishment of central machinery to deal with the problem of applications. I understand that the Committee of Vice-Chancellors and Principals is convening a conference of university representatives in March to examine the very important proposals in that report. I would rather not comment in advance of that meeting.

Does that include Oxford and Cambridge? As long as they are outside these provisions, it is almost impossible for the other universities to work out a scheme.

This is the Committee of Vice-Chancellors and Principals.

asked the Chancellor of the Exchequer if he will authorise the Customs and Excise to refund duty in respect of stocks of tobacco and cigarettes damaged by flooding.

No, Sir.

Is it not extremely unfair and unreasonable that companies should be expected to pay Customs and Excise duties on cigarettes and tobacco destroyed by flooding? Does my hon. Friend agree that, if private commerce did such things, it would be regarded almost as sharp practice? Will he ask his right hon. and learned Friend to look into the matter again?

I appreciate my hon. Friend's concern but, of course, the matter does go much wider and includes, for instance, cases where goods are destroyed by fire. The fact is that there is no provision in the law under which the Department of Customs and Excise could allow a refund of duty in respect of stocks of tobacco and cigarettes damaged during the recent flooding. I looked into this very carefully when my hon. Friend wrote to me. I am sure that he will have in mind the statement made by my right hon. Friend the Minister of Housing and Local Government on 2nd November, 1960, about the way in which people who have suffered as a result of flooding might be helped.

asked the Chancellor of the Exchequer what would be the loss in revenue if no Stamp Duty were payable on mortgages of £3,500 or less.

About £2 million.

Is my hon. Friend aware that the remission of this section of Stamp Duty would be of particular benefit to those who have most difficulty in purchasing their own homes?

I am sure that my right hon. and learned Friend will bear my hon. Friend's point in mind.

Does the hon. Gentleman realise that there is a considerable anomaly in relieving conveyances below this value from Stamp Duty in order to encourage house ownership by not very wealthy individuals and then charging a Stamp Duty when they raise the capital to enable them to make the purchase?

Of course, all these points will be borne in mind. I cannot make any further comment today.

asked the Chancellor of the Exchequer what representations have been made to him by the Ayr County Council on the question of interest rates; and what has been the nature of his reply.

I am aware of these representations. I have nothing to add to what I said earlier in reply to the hon. Member for Fife, West (Mr. W. Hamilton).

Is the hon. Gentleman aware that the Minister of Health said yesterday that he wanted to encourage local authorities to develop the health services which belong to them? How can they do that when such high interest rates are charged?

As one would expect, nothing that my right hon. Friend said conflicts with what I said earlier.

asked the Chancellor of the Exchequer what action he intends to take, following the representations made to him by Ayr County Council, regarding the high rate of interest charged by the Public Works Loan Board on money borrowed by local authorities for capital works.

I intended to answer this Question with Question No. 53.

Does not the Economic Secretary recognise that local authorities in Scotland are getting into particular difficulty with the build-up of public work which they cannot undertake simply because of the imposition of high interest charges by the Public Works Loan Board? I appeal to him to get his right hon. and learned Friend to consider this matter, with a view to aiding local authorities which could give him very good grounds for making the change.

As my right hon. and learned Friend said to the hon. Gentleman on previous occasions in connection with representations by the Ayr County Council, we do not consider that it is right that, with capital in short supply, local authorities should be insulated from the effects of current interest rates.

Does the hon. Gentleman recollect that his earlier replies indicated that a reduction in the interest rates to local authorities would be tantamount to giving them a subsidy? If that is so, can he explain why a farmer building a piggery gets a 50 per cent. subsidy and a local authority does not get anything at all for building a house for individuals? In addition, Colvilles steel company in Scotland is to get a £50 million subsidy from the Government with no interest whatever—at any rate. in the first year.

Those points go somewhat wider than the representations made by the Ayr County Council, but there can be no doubt that to provide preferential interest rates would be to give a concealed subsidy, because it would involve giving facilities for borrowing at rates below those ruling in the market.

asked the Chancellor of the Exchequer if he will advise the setting up of a Royal Commission to review, and make recommendations upon, the financing of the social services in the context of contemporary conditions and the nation's resources.

No, Sir.

Would not my hon. Friend agree that there is a considerable divergence in the pattern of financing of our social services, more the result of the accident of time and history than any logical reason? Would not he agree that a review by a Royal Commission could give a detached and dispassionate study to this important question and thereby help the evolution of a system containing the highest common factor of economy, efficiency and the avoidance of hardship?

I agree entirely with the first part of what my right hon. and learned Friend said. Concerning the second part, I rather doubt whether this is a suitable field for recommendation by a Royal Commission, because I think that I may carry the House with me when I say that ultimately this must be in the field of political decision.

While agreeing that this is a matter for Government policy, may I ask the Minister whether his right hon. and learned Friend is considering any reform for the raising of finance for the social services which would be more just and sensible than the present system and which would be fair to the various sections of the community who are called upon to contribute?

We are in a period when hon. Members on both sides of the House will have full opportunity to air their views on financial affairs in this respect.

In view of recent Government policy on financial matters, would it not be cheaper for the nation for the Financial Secretary to purchase a copy of the document "Practice and Principles "and give it to his right hon. and learned Friend, because this is what they are putting into effect?

I do not want to be discourteous to one of my constituents, but I do not honestly see the point of that supplementary question.

asked the Secretary to the Treasury whether he is aware that people who have intermittent periods of illness preventing them from work are not being paid post-war credits because each of such periods does not last continuously for twenty-six weeks; and if he will amend the regulations to give greater help to sick people in need.

I am aware of the regulations. On the second part of the Question, I will bear the hon. Member's proposal in mind, but it presents serious practical difficulties.

I thank the Minister for his reply. Will he give serious consideration to the matter, particularly in view of the case in Leicester which I brought to his notice in which a person, who, unfortunately, suffers from a very serious illness—he has had many periods of illness of less than twenty-six weeks duration—and is unable to obtain the post-war credits although the aggregate of the periods of illness is extremely extensive?

The hon. Gentleman has referred a hard case to me, as I am well aware. Therefore, I have been looking into it as carefully as I could. The difficulty is that, while a formula could be devised to meet these cases, it would be extremely difficult to operate, not only for the Revenue, but for all the other authorities which will have to certify the claims. We have isolated a number of social service categories from the point of view of priority release of post-war credits. We should be careful of going further until we are sure that any regulations will operate fairly, although I fully recognise that the case which the hon. Gentleman has raised is a hard one.

I made a mistake in thanking the Minister. In view of the unsatisfactory reply, I propose to raise the matter on the Adjournment at an early opportunity.