My Lords, I do not think it will require many words of mine to recommend to your Lordships the Second Reading of this Bill, because the circumstances out of which it arises are comparatively fresh in the recollection of nearly everybody who is now listening to me. A few years ago, public opinion in this country was profoundly concerned at certain scandals which had arisen in connection with the distribution and conferring of honours. It appeared that there were several cases in which insufficient care had been taken in recommending persons for the receipt of honours to His Majesty. There were grounds for thinking that pecuniary considerations entered into the reasons for the conferring of these honours in a way in which they ought not to have done, and the country became convinced that a matter which ought to be above suspicion had become discredited. It was resented in the country, and properly resented, as an insult to the King and as an outrage upon decency.

It had this further effect—this want of care in the distribution of honours—that there was evidence to show that a number of persons had grown up who were prepared to exploit the insecurity which seemed to belong to the distribution of honours and they put themselves forward, entirely without justification, of course, as being in a position, for pecuniary considerations, to put forward certain names and to secure their selection for particular kinds of honours. What my late noble friend Lord Curzon described as "this ignoble phenomenon" was, I think, one of the very reasons which led to the appointment of a Royal Commission, presided over by my noble and learned friend Lord Dunedin. The Commission was entrusted with the duty of considering the matter and making recommendations so as to prevent those mischiefs to which I have alluded. That Commission sat and made a series of recommendations. One of them was the appointment by the Privy Council of a Committee of their own body, whose business it should be to examine the names of proposed recipients of honours before they were submitted to His Majesty. That has been done by every Government which has been in office since Lord Dunedin's Commission reported. They also recommended that, in order to deal with these persons who professed that they could manipulate honours for money, the traffic in honours should be made a criminal offence. A good deal of evidence was laid before your Lordships on this matter, notably by my noble friend the Duke of Northumberland, who made one or two speeches which made a great impression upon this House and the country.

This proposal was made and, in consequence of it, the Government which succeeded Mr. Lloyd George's Government, the Conservative Government of 1923, introduced a Bill and passed it through your Lordships' House, making this traffic in honours a criminal offence. This Bill, with the exception of very small changes to which I shall call your attention in a moment, is practically a repetition of that Bill which has already passed this House. It was sent to another place, but, owing to pressure of time and other work, it was not proceeded with, and so it still remains to be carried into law. There is, in fact, of course, no difference of opinion in all political Parties as to the propriety of this Bill. I feel a strong conviction that both the noble and learned Viscount the Leader of the Opposition and the noble Lords who sit above the gangway opposite will agree in considering that this traffic in honours is ignoble and that public opinion ought to be vindicated by pronouncing it to be a criminal offence.

Of course, speaking as I do at the end of June, amongst an audience who are familiar with Parliamentary proceedings, there is no chance of this Bill being carried into law—although I have no doubt your Lordships will agree to it—unless there is a general consent that it ought to be enacted. I have a hope that if the noble and learned Viscount the Leader of the Opposition uses his influence with his friends in another place, and if the noble Earl, Lord Oxford, also uses his influence with his friends in another place, then the universal feeling of reprobation of this practice will be sufficient to carry the Bill through as an unopposed measure in another place; otherwise, I am afraid, it has no chance in the; present Session. I am aware that, although I am quite certain the noble and learned Viscount agrees in reprobating these practices, he expressed a doubt the other day, when we were discussing a Motion in the name of Lord Selborne, moved by Lord Danesfort, whether a Bill of this kind would be altogether effective in preventing such a practice. Of course, it is quite true that in all these matters of corruption, and practices allied to corruption, where the corruptor and the corrupted are agreed together that they desire to break the law, it is always very difficult to bring home the offence. That has been the experience in respect of electoral corruption, as everybody knows, but at the same time I would suggest to your Lordships that there is a real and independent value in marking the sense of reprobation of Parliament and the country in the form of an Act of Parliament.

After all, there are many laws—I was going to say most laws—which would be more or less ineffective unless they were supported by the weight of public opinion, and it is the combination of public opinion and the crystallisation of public opinion in the solemn form of an Act of Parliament which has a great effect in a country like ours. It sets, as it were, upon these practices the seal of ignominy. Everybody knows henceforward that the highest authority in the country has solemnly pronounced that to buy an honour, or to be concerned in buying an honour, which ought to be the reward of merit—to do it for the squalid consideration of money—is an ignominious act and it will operate, I am convinced, as a strong deterrent from the pursuit, of these practices.

I feel very strongly, if I may say so, that your Lordships would fail in your duty if you did not carry out the recommendation of this Royal Commission. No doubt we all forget, and even in the four years which have elapsed since these scandals a little of the feeling has evaporated, but still sufficient remains. I am quite sure that public opinion expects that these things shall be reprobated, as I have suggested that they ought to be. It is therefore with great confidence, and in the hope that our action may result in adding this Bill to the Statute Book, that I move the Second Reading of the Bill.

My Lords, the noble Marquess who leads the House has appealed to me and so far as I have any influence he certainly has not appealed in vain. The Labour Party does not like honours in general. It was very, very sparing in distributing them when it was in power and it certainly is favourable to the most stringent application of such a law as is contemplated in the Bill. If I have any doubt, it is not about the principle' of the Bill, but as to the possibility of getting hold of all the people who indulge in the practices which the Bill reprobates and proposes to punish. I have myself seen the system at work. I have known cases, and known them in detail, when, if there had been such a law as this, it would, I think, have been easy to obtain a conviction.

But there is another class of case which I have known which is more difficult to get at. To me it seems almost as disgraceful that anybody should ask for an honour on the ground of services which he proposes to render or has rendered as to work for an honour in consideration of some pecuniary payment. It has happened to me, and I dare say it has happened to others of your Lordships who have been in office, to be asked openly and blatantly for a reward, a knighthood or something of the sort, as a consideration for rendering some public service. I need not say that so far as I am concerned the applicant always had short shrift. But that there is a great deal of that I have not any doubt, and I am not sure that this Bill wholly reaches it.

This Bill may create a public opinion which will be operative against that more subtle class of case, but it does not wholly cover it. There are cases which I have seen which the Bill will cover, but the more delicate thing is the attempt which is made by persons who desire honours, or by persons who are acting in their behalf, to put forward quite unworthy considerations for the granting of the honour. It is not the Prime Minister who is responsible for these things; he is the victim. The Ministers are generally the victims. But down below there is a class of persons who are quite unscrupulous in these matters, who go and say: "I can get you a knighthood or a baronetcy if you will only put yourself in my hands." There is not much discussion of the reward at the time, but the reward is discussed afterwards, and the result of what is done is that various subtle means are resorted to for creating a favourable attitude towards the claim of the person con- cerned. That happens on a very large scale, and I am afraid it will not wholly cease to happen even if this Bill becomes law.

But this Bill will do something to stop the more flagrant cases. I think the condition of its success is that the Public Prosecutor, to whom the matter will pass, should have instructions that he is to be very strict in applying the law and in prosecuting wherever he gets decent evidence on which to proceed. Everything lies in the execution of a law such as this, and I trust that if the Bill passes, which I hope it will do without any opposition, the Government will do their part by giving the most stringent instructions that these cases are to be looked out for and prosecuted without mercy.

My Lords, I rise only to say, in a few sentences, that the appeal which has been made by the noble Marquess the Leader of the House has certainly not fallen on deaf ears on this Bench. Anything that we can do to facilitate the passage of the Bill will naturally be done. I confess I join issue somewhat with the noble and learned Viscount who has just spoken in regard to the probability of this Bill being frequently used. I think it is more likely that no prosecution will ever take place under the clauses of this measure. It is extremely difficult to prove a secret commission and evidence which would perfectly satisfy us in our private capacities would probably fail to satisfy a court of law. Evidence sufficient for that purpose will, I am afraid, be exceedingly difficult to secure. However, this Bill will remain as a deterrent, as the noble Marquess said, and mark the sense of reprobation which we feel towards practices of this kind. It is regarded in that light that my noble friends and I will be happy to support it.

My Lords, I Have often listened to somewhat unreal discussions in this House and discussions upon unreal Bills, and I am not without a lingering hope that this particular discussion may be invigorated and vitalised by a contribution from, say, one of those gentlemen the conferring of the distinction of an honour upon whom excited u certain amount of criticism not long ago. How far more interesting this debate would be if some of those gentlemen could be induced to come forward and tell the House exactly what took place under the circumstances.

This Bill, I imagine, emanates from the Report of the Royal Commission which has been alluded to in such flattering terms. For my part I feel quite unable to speak in flattering terms of this particular document. To be quite candid, I do not think that I ever read a document of a more disappointing and more unconvincing nature, and I say that with all the more regret because I expected a great deal from my noble and learned friend Lord Dunedin, with whose ability and capacity and energy I am well acquainted. Really the only important part in this Report is the Minority Report of Mr. Henderson. Mr. Henderson is a person with whom I do not often find myself in agreement, but on this particular occasion he seems to me to have been absolutely right. Mr. Henderson appears to have conceived the notion, which I am inclined to share myself, that this particular Commission was never intended to do any business at all He observes with great truth that the Commission might with advantage have been much move searching in its Inquiry and that the omission to examine persons who had asserted that they were in a position to obtain honours and also those who had been approached "has left unexplored one of the gravest abuses." Faced with this charge the majority of the Commissioners took refuge in the terms of reference, asserted that they were precluded and prevented from inquiring into anything in the past, and claimed that they were concerned solely with the future.

But this tame, colourless and anæmic Report of the majority is not altogether without interest in itself. There is one page at all events in it which excites my interest, and it so much excites my interest, that I cannot forbear reading it textually to the House. The majority of the Commission reported:—

"We put the question to each Prime Minister in turn, whether he had ever been cognisant of any bargain or promise to the effect that an honour would be contingent upon a contribution to Party funds. We received the answer that we expected, that they had not. Answers to the same effect were given by the Patronage Secretaries and Party managers."

Then the Report goes on:—

"The existence of Party funds is notorious and the necessity for such existence under modern conditions as to the conduct of elections is equally so. Indeed, two of the Party managers with great frankness informed us, giving actual figures, as to the sources of supply. They were at the same time emphatic that, so far as they were concerned, no bargain of the sort alluded to had ever taken place."

The first portion of this extract, that which deals with the statement of the Prime Ministers, does not surprise me at all. Prime Minister would be an exceedingly simple person—and I do not suppose, we have ever had a really simple Prime Minister—if he had any cognisance of any question of this kind. He would take the greatest possible care, naturally, not to know anything about it. Why should he?

But when I turn to the second part of the statement, where you have Party managers and Party Whips laying their hands upon their hearts, so to speak, and saying that in no single instance within their recollection had they ever known of an honour being conferred in return for some contribution, I can. only say that I am filled with amazement, and I expect that many other people must be filled with amazement, too. In fact, it makes my brain whirl when I read statements of this kind and I might almost ask the House to attach no importance to what I am saying because it strikes me as such a perfectly amazing statement. But my surprise hardly equals that of the Party managers and Party Whips; because their surprise must have been mingled with extraordinary satisfaction, unexpected satisfaction, since what we are led to assume is that the whole question of the bestowal of honours and the return of some consideration is a pure coincidence.

Apparently, in the opinion of the majority of the Commissioners, the Party managers and Party Whips are altruists, who go about the country in search of merit. They search the highways and the byways, they search the backwoods, and occasionally they come across a gentleman who is considered worthy of an honour, and, by another strange coincidence, this gentleman generally happens to be very rich. What must be astonishing to these innocent and ingenuous people is that they select a man for an honour and, perhaps, a few days afterwards, they receive a handsome cheque. I can imagine the correspondence that takes place:—"Dear Mr. So-and-So," or "Dear Lord So-and-So, When I recommended you for an honour to the Prime Minister the last thing that ever occurred to me was that any money should pass. But as you are evidently anxious to devote this money to patriotic purposes, I am ready to accept it and to make any use of it that you may approve."

I confess that I am not much of a believer in coincidences. I expect that the enterprising gentleman from America who landed here the other day would tell you that it was a pure coincidence that he discovered on the pier at Southampton a detachment of Territorials who were good enough, by a pure coincidence, to take charge of his tin box on its way to London. I remember a case not long ago in which a gentleman was tried and convicted of having murdered his wife by drowning her in a bath. The question was asked him:—" Did not your two previous wives also die by drowning in their baths? "And he replied:—" Well, yes, it is quite true they did, but it wag only n singular coincidence."

This theory of coincidence is really too thin. And it is buttressed up by another explanation which also carries no conviction at all to me. We are asked to believe that there are a number of people in this country who make a livelihood, and apparently a dishonest one, by going about and getting money from people on the ground that they are in a position to obtain honours for them. I have not much belief in these people I am rather inclined to class these so-called touts with "hidden hands," international spies, vampires and the usual creations of people's fancy. But even supposing they exist, even supposing these touts are actually living people of real flesh and blood, how on earth can they procure an honour? A tout may come to anybody and promise him anything that comes into his head; but surely nobody believes that he is in a position to carry out his promise?

Who confers these honours? The tout does not. He is not in a position to give them at all. These honours are distributed by the Government, by means of its Patronage Secretaries and Party managers and, finally, the Prime Minister. In that case it seems to me perfectly idle to contend that the Government have no responsibility at all and that the blame attaches to these mythical beings who, for the sake of convenience, are described as touts. I have no personal experience of these gentlemen. Nobody ever tried to bribe me, except a gentleman of Levantine extraction, who gave me some cigarettes and then wrote to me and said that he would like to be made an English baron. If anybody made a serious proposal to me I do not know how I should take it, but let us assume, for a moment, that I am a person who is very anxious to be made, for example, an M.V.O. or to become a Viscount.

Under the theory of the Bill I go to some noble friend of mine, for choice, possibly, shall I say, to my noble friend Lord Younger, and I say or write to him:—"Dear Younger, I am very anxious to become a Viscount, and if you will secure this for me I am prepared to contribute a handsome sum towards the building of the new ladies' dining room at the Carlton Club, for which I gather funds are urgently needed." Presumably, that is how I should act under the Bill. Of course, Lord Younger, Lord Banbury, or whoever it might be, are law abiding people and it would be their duty to inform the Public Prosecutor, or the Attorney-General, or some important person of the sore and denounce this. Under the Bill I should be liable to a penalty not exceeding £500 and, possibly, to two years' imprisonment. But I am not so simple as the members of this Commission. I should not set about it in that way at all. I should approach Lord Younger or Lord Banbury in some secluded place, possibly in this House-there is not usually much congestion here—and I should do it verbally, and it would be impossible to convict me, because there would be only my word against his, and they would be just as likely to believe me as either of my two noble friends.

It is just as well, it seems to me, that we should recognise certain facts in connection with this matter. I think the first act that we ought to recognise is that the Government administration of this country is much less corrupt than it is in any other country, and the integrity of our permanent officials is infinitely higher than that which prevails in countries elsewhere. I can call to mind a notable instance, which probably has occurred to many besides myself. Only a few days ago there died one of the most distinguished public servants this country has possessed in the person of Sir Eyre Crowe. I observe that he left the miserable pittance of something like £1,300. I have no hesitation in saying that if a person occupied Sir Eyre Crowe's position in some foreign countries which I will not name he would, in such circumstances, have died a multi-millionaire.

Another fact which is worth bearing in mind is that there is really nothing disgraceful in contributing to Party funds. It is certainly a much lees objectionable procedure than bribing individual Ministers, which is done in many countries that I need not mention. As has been pointed out in this Report—about the only sensible thing in the Report—it is a necessity, because political organisations cannot be maintained without private subscriptions. The fact is that it is a kind of non-official political levy which is recognised, and we do not particularly resent it unless it is carried to excess, or, as my noble friend Lord Salisbury observed just now, unless there are outrages upon decency. Provided it is carried on in moderation it is like everything else—like drinking in moderation, or betting in moderation, or overcharging by tradesmen in moderation. You submit to it up to a certain point; it is only when the thing becomes a scandal that your indignation is aroused and you rebel. And a very good thing, too. I think one of the most useful things that ever was done here was the action of my noble friend Lord Harris, who I regret is not present this afternoon, in preventing the elevation to the Peerage of a gentleman whose reputation was of a somewhat dubious character.

This Bill, it seems to me, is a very poor attempt to whitewash the people who, if there are offenders at all, are the real offenders—that is to say, people in Governments. This is an attempt to divert attention from them, and to make us believe that this imaginary race of villains exists who are debauching our public life. Personally I do not think it matters in the smallest degree whether this Bill passes or not. I think that things will go on as they have gone on in the past, and I do not regret it, provided, as I say, the thing is not carried too far. As regards the Bill itself I do not believe it can have the smallest impression on any man, woman or child in the country.

acquainted the House that the Bill had been endorsed with a certificate from the Speaker that it is a Money Bill within the meaning of the Parliament Act, 1911.

My Lords, I beg to move that this Bill be now read a second time.

My Lords, the constitutional supremacy of the other House in matters of finance is unquestionable, and now unquestioned, and so far as the present financial year is concerned the provision made both for Expenditure and Revenue is unalterably embodied in the Bill which your Lordships are now asked to read a second time. But that does not, at any rate in my opinion, in the least take away the privilege of this House, or absolve it from the duty, of contributing in debate, so far as its members can in a domain in which it cannot legislatively intrude, to a dispassionate review both of the actual and prospective financial situation of the country. And that is the task to which for a few moments, with your Lordships' indulgence, I propose to address myself.

I may say at once that I approach the matter with a full and sympathetic appreciation of the almost unprecedented difficulty and complexity of the problems which confront any man, to whatever Party in the State he may belong, who is called upon under existing conditions to undertake the stewardship of our national finance. It is almost exactly twenty years since I myself undertook the office of Chancellor of the Exchequer. We had in those days to grapple with serious questions—on the one hand, the liquidation of the enormous addition which had been made (enormous as we thought it in those days) to our National Debt in consequence of the South African War, and on the other hand, as time went on, the making of adequate provision for national defence against new and menacing external dangers, and for the urgent and, indeed, the clamorous requirements of social reform. That was an anxious situation which required to be handled with such care and courage as we could bring to it.

I may perhaps recall, for it is not irrelevant to the situation in which we now find ourselves, that, in undertaking that task we accompanied a large diminution in the capital of the Debt, and considerable reductions and remissions of burdens from taxation, with a number of schemes for improving the permanent conditions of the industrial classes—Old Age Pensions, National Insurance and the rest—the new burdens of which were imposed upon the community at a time of prosperous and expanding industry. The conditions are very different to-day. The situation? with which we had to deal was not comparable with the exigencies which in these times face the financial Ministers of all the European countries who were combatants in the War, and certainly not least our own.

I say that in order to assure your Lordships that it is not in any captious or controversial spirit that I have set myself to examine the Budget of the present year. Indeed, so far as personal prepossessions may be legitimately carried, I had every reason for at least anticipatory sympathy with the proposals of the present Chancellor of the Exchequer, to whom I am attached by long and tried association in the past and by unbroken and undiminished friendship. There are, I know, censorious critics who have professed to have discovered in Mr. Churchill's career signs or symptoms of what I may call political versatility. But there was always one fixed pivotal point, which no one could deny or ignore, and that was his strict and even stern adherence to the pure doctrine of Free Trade. Indeed, in those occasional moods of diffidence or of doubt, which from time to time over-cloud the most robust believers, I know of no better medicine than to take down from one's bookshelves the collected speeches of the right hon. gentleman and to refresh and reinvigorate one's Free Trade principles by a bath in those pellucid, perhaps I may say, those saline streams. Therefore, I confess that I never thought I should find him toying even with the fringes or fripperies of Protection.

But I gather, not from his speech but from an aside which he emitted in another place, that since he has become Chancellor of the Exchequer he has been restudying the foundations of belief and that he has come to the conclusion that fluidity of conviction is the secret of intellectual perfection. That accounts for some, perhaps not the most important, of the features of the present Budget. I will not dwell in detail upon them, but I will pass a few of them in brief and summary review. I observe in this connection that a recent recruit to the Labour Party in another place—and, if I may venture to say so, a very valuable recruit, for he is evidently a trained economist—Mr. Dalton, has discovered that there are seven different commodities and groups of articles which are afforded in greater or less degree protection in the Budget. Some of them, it is true, are old friends—the disinterred McKenna Duties on motor cars and the rest. Of them I will only say this, that having regard to their origin, to their history, to their actual operation and to the present condition of the trades concerned, their resuscitation at this moment is, in my opinion, a freak of fiscal perversity almost without example in the whole of my financial experience. So much for them.

What of the newcomers—hops, silk and lace, which make up the seven? Of hops I will say nothing—de minimis may suffice for a commentary upon them. But what of silk? I can hardly conceive of a new Import Duty which is exposed to more fundamental objection than this tax upon silk. It is a tax on raw material, a thing which Mr. Joseph Chamberlain never overtly advocated in the heyday of the fiscal controversy; and when all allowance has been made for the countervailing Excise Duty it has about it a very distinct and unmistakable favour of protection. It is in no sense a tax upon luxury. It is absurd so to describe it. I agree that it is not in the strict sense of the term a tax upon one of the necessaries of life, but it is an impost upon articles which in the recent developments, mysterious, perhaps inexplicable to some of us, of taste and fashion in this country have become, and tend increasingly to become, a part, and an integral part, of the comforts or what I may call the simple adornments of our national life.

Then I come to lace, a small affair no doubt in itself and upon its own merits, and on which, in itself, it would not be worth while to waste even five minutes of your Lordships' time. This heavy Import Duty upon lace, imposed in consonance, or in supposed consonance, with the policy of the Safeguarding of Industries Act, has two features which, quite apart from its intrinsic insignificance, deserves, I think, at any rate a passing notice. In the first place, it does not comply with the conditions which are deliberately laid down by the Government themselves in the White Taper which they issued at the beginning of the present Session; and in the second place—what is much more important—it opens a door to claims for similar protective treatment from industries immeasurably more important and in themselves suffering to a far greater degree from the inroads and the menaces of foreign competition, industries—I will take one which has already put forward a claim, though I understand that it has been, for the moment at any rate, rejected or postponed—such as iron and steel, an import duty upon which would have a depressing and even a disastrous effect upon a whole group of ancillary and dependent British industries.

I am not going into the question of whether these protective or semi-protective duties (for such they are) are a violation of the pledge which was given by the head of the present Government and renewed elsewhere in the early days of the Session and which is defined by Mr. Churchill as amounting—I will take his definition of it—

"to no more than a promise not to commit the country during the present Parliament to decisive changes in our fiscal system."

I see that Mr. Churchill claims credit that in the ease of lace, which comes within the ambit, or the supposed ambit, of the Safeguarding of Industries Act, he has proceeded by a general tax against all importations, whencesoever they are derived, and not by discriminating duties against particular countries. He takes refuge in one of his ingenuous epigrams and says that a general duty is a general duty (which is undoubtedly true) but that a general tariff is an aggregate of general duties. See what that means. It means this: that Free Trade, that what we are accustomed to regard, and what I certainly regard, as the citadel of Free Trade, is to be sapped and mined by a succession of timorous, exiguous, piecemeal instalments which are, as everybody knows, preparing the way for what, under the pledge given, cannot be attempted in the present Parliament but is clearly contemplated and intended by the great bulk of the supporters of the Government—an open and a frontal attack. That is all that I think it appropriate to say on the present occasion of the detailed proposals of the Budget, except—and it is a large exception—to express my complete approval of two very important points. The first is the maintenance intact of the increased Sinking Fund; and the second the reductions and readjustments in the Income Tax.

But, as I said at the outset, if your Lordships will give me a few moments' more indulgence, I think it is more important on an occasion like this, and in this place, to come face to face with the general financial situation, both actual and prospective. I am no pessimist—I never have been, and I hope I never shall be driven to be—but I view that situation with solicitude which verges, at any rate, on apprehension. Let us look at it. It is idle to pretend that there are any trustworthy signs of a genuine revival of British trade. At this moment, in some of the greatest of our national industries—I will instance two or three: coal, shipbuilding, the main, or at any rate some of the most important, branches of engineering, iron and steel—it is to-day and, for all that we can foresee, it is for some time to come to be, not a question of making profits, but of cutting losses and of closing down mines and factories; and side by side and, perhaps, as a natural and. indeed, a necessary accompaniment of that process, the straining of relations between employer and employed threatens to approach—we hope it will not reach—the breaking point. The figures of unemployment, instead of abating, grow month by month with a disheartening and, indeed, I might say a menacing rate of progression.

And yet, with all this going on before our eyes and with no visible, I might almost say with no imaginable, prospect of immediate or speedy amelioration, Parliament is invited, as it is in this Bill, to sanction for the current year an Expenditure of £800,000,000. If you add—as you must add. to take a just estimate of our national liabilities and commitments—our local expenditure, made out of rates, there is an addition, according to the figures of last year (this year they will probably be increased) of at least £160,000,000. That is to say, you are confronted with an aggregate expenditure, national and local, which will not and cannot fall far short of £1,000,000,000. Even in these days of colossal international arithmetic that is not only an unexampled, but if is a most formidable figure.

Let me give one illustration—at least, it is not an illustration but a relevant fact which shows how formidable it is. Our national income is estimated by great authorities such, for instance, as Sir Josiah Stamp, at £3,800,000,000, and therefore you are taking toll upon that of a quarter. Compare that with the state of things which existed before the War—and this comparison is not in the least invalidated or even affected by the changes which have taken place in the value of money; not in the least. Before the War the national income was estimated by similar authorities at £2,500,000,000 and the expenditure, national and local, at that time was not one quarter but one ninth of the whole. That surely ought to give us pause, and I am stating, after a somewhat prolonged experience of public affairs and particularly of finance, my deliberate, opinion when I say—and I say it to the people of this country, not only to the Government, for I am not for the moment in any critical spirit so far as they are concerned, because I believe they will agree with most of what I have said—I say to the people of this country and to both Houses of Parliament, in the plainest possible terms, that expenditure on this scale is more than this country can afford.

Yes, but one of the worst and most aggravating features of the case is this, that that expenditure tends not to diminish, not to remain stationary, but to grow. This very Budget sanctioned by the Finance Bill, which your Lordships are about to pass, has increased not only upon the Estimates but upon the actual Expenditure of the year for which the Chancellor of the Exchequer in the Labour Government was responsible. It has increased the cost of our fighting Forces by £6,000,000, and, as we know—it has been intimated upon the authority of the Government themselves—there is a Supplementary Naval Estimate to come—an Estimate which, quite apart from the additional charge, which it will throw upon the Revenue of the current year, will mortgage the Revenues of succeeding years—three, four or five, at any rate— by a heavy and unavoidable burden. Then there is—and here I know I shall not be expressing the view of the majority of the members of this House—the Singapore adventure, which seems to me, and I have given it the most dispassionate consideration, to be quite unwarranted on the ground either of sound strategy or sound policy, and which, though it calls, it is true, for only a trivial instalment of expenditure in the present year, will throw an increasing burden upon the next nine or ten years—a burden, unless my prevision is wholly at fault, probably largely in excess of any estimate which has yet been made. I regret to say that even within the last few days we have heard rumours—I trust they will turn out to be unfounded in fact—that there are fresh demands coming from Mesopotamia, where, in my judgment, neither the honour of this country nor the permanent interests of British taxpayers call for or justify any further commitments. I was right, therefore, when I said a moment ago that so far as the actual aggregate of Expenditure is concerned we are not justified in hoping for, still less in counting upon, any prospect of diminution. On the. contrary, the prospect is altogether the other way.

I am not saying these things, as I am sure you will believe, from any desire to make Party capital As I said at the beginning, I realise to the full the special and the unexampled difficulties of the problems with which any Government, to whatever Party it may belong, is in these days confronted; but we must look these things in the face. Let me turn, if I may, for a few minutes, to the other side of the account. I have been speaking of our national Expenditure. Can we hope, as a set-off against that, for any substantial increment of Revenue? Here again the only, as I think, intelligent and trustworthy forecast is entirely the other way. Your Lordships must remember that the Revenue of the present year, like that of all the years which have passed since the conclusion of the War, has been artificially swollen by special receipts. The amount, I believe, for the current year has been no less than £30,000,000, special receipts, which will not recur and cannot recur in the years that lie before us. But I should like to say something further in regard to our prospective Revenue. In my judgment the limits of taxation, actual or possible taxation, have been all but, if not altogether, reached. There are no substantial additions to existing taxes and, so far as even my imagination can conceive, no new taxes that can be invented which will not further depress industry and impair, instead of increase, the productiveness of your sources of revenue.

What is the inference from all the facts, undisputed and indisputable, which I have ventured to lay before your Lordships. The inference, the inevitable inference, is that there is one and only one way of escape—ruthless and relentless cutting down and cutting off of every form of avoidable expenditure. The country—and I am sure that the Government will agree with me here—will not be, and ought not to be, content with vague declamatory assurances, of which no one need doubt the sincerity, that they are hoping to reduce our Expenditure, as the Chancellor of the Exchequer says, by £10,000,000 a year. Those assurances would command more weight if the Expenditure had not been actually increased during the current financial year by a substantial number of millions sterling. Nor will it or ought it to be reassured by the information that a Cabinet Committee is to be set up to discover possible economies. A Cabinet Committee! Those of us who have beer' any length of time in public life know by experience that the appointment of a Committee is a facile expedient which offers almost irresistible temptations in moments of perplexity to even the most austere and high-principled Governments. I myself when I was in a responsible position have more than once resorted to it. I make that candid admission.

But as regards this suggested Committee, there are two questions which I should like to ask and to which I hope that the Government will vouchsafe an answer to-day. The first question is this. Has it, in fact, been appointed and begun to function, and if not—and this may be regarded as an indelicate inquiry—what is the probable date of its birth? The second question, which is a more important one, is, why and for what purpose is such a Committee needed? A committee is or ought to be an instrument of exploration and, if possible, of discovery in a region of which some at any rate of the facts and features are still imperfectly ascertained. That is not the case here, not the least. All the relevant facts are already on the table. They are perfectly well known because they are disclosed, under our wise and politic system of publicity, in the accounts and the accompanying documents which every Government submits to Parliament and the country.

In my judgment no remedy is to be found in the necessarily dilatory and, as I think in this case, otiose proceedings even of the most expert and most inquisitorial committee. Where is it to be found? It is to be found only in one quarter and only by one agency and that is in the independent and authoritative activity of the Chancellor of the Exchequer himself. It is for him to control the spending Departments and, if in the Cabinet they succeed in eluding or frustrating his control, to disclaim further responsibility and give up his office. I have seen many of these struggles myself in a comparatively long experience of Cabinet life and sometimes there has been an almost ironic and paradoxical change of the different personalities who have been engaged upon the one side and upon the other. The spending Departments always have at their disposal a well-filled arsenal, not only of plausible, but often of well-founded arguments. Are you going, they ask, to starve national defence? Are you going to cashier devoted and efficient servants of the State? Are you going—an argument which is perhaps more potent to-day than it used to be in days gone by—to cripple or maim the machinery and the further and future developments of social reform?

Those are difficult and distasteful questions for any Chancellor of the Exchequer, who knows well, as all Chancellors of the Exchequer know, with an intimacy and a fulness of knowledge denied perhaps to anybody else, the devoted and able men who, for often most inadequate rewards and uninviting prospects, man both our fighting and our Civil Services. But all those things, relevant as they are and, from the Chancellor of the Exchequer's point of view, difficult as they are, must give way to the supreme national necessity. And I have come to the conclusion, not, I confess, without hesitation or, indeed, reluctance, that the Chancellor of the Exchequer, in the performance of this invidious but imperative duty, must boldly take the line of rationing the Departments; that is to say, be must tell them frankly:— "Your functions are important, your objects are excellent, many of the proposals which you make are proposals which, as a politician and a statesman, command my complete sympathy and approval. But you must cut your coat according to your cloth." In these times, in the actual and prospective conditions with which we are confronted, with a very large discretion to individual Ministers as to how they will apply for the special purpose of the services for which they are responsible what is allocated to them, there must be a maximum which they will not be allowed to exceed. It sounds a crude and, perhaps, a somewhat dictatorial procedure; but there is no other way or so far as I know, suggestion by which the unprecedented exigencies of our national finance can at this moment be adequately met.

Apologising as I do for detaining your Lordships so long, it is a matter upon which I feel Very deeply, and I am expressing very deliberate and wholly dispassionate convictions. I recognise to the full the enormous and wholly creditable impulses which lead1, and necessarily lead, ardent and progressive Ministers to raise their Departments to the highest level of efficiency and, in many cases, to enlarge the ambit of their operation. No one feels that more strongly than I do. But I do not think that anybody who has held, as I have held, responsible offices as a spending Minister, as Chancellor of the Exchequer and as First Lord of the Treasury, would be doing his duty to your Lordships' House or to the country unless he pressed upon you, as I do with whatever emphasis and, if I may say so, with whatever degree of authority I can command, the views which I have endeavoured to put forward.

My Lords, this is the fifth debate upon financial subjects which has taken place in your Lordships' House since February last, and on each previous occasion I have had the opportunity of speaking in great detail and placing fully before your Lordships the views of the Labour Party. Therefore, to-day it is not necessary for me to do more than make some general observations and my speech can be one of comparative brevity. Nevertheless, there are still some things which I wish to say, especially after hearing the speech of the noble Earl, Lord Oxford and Asquith. I will come straight to what I regard as the, main feature of the debate, although it is a feature upon which the noble Earl spent, I think, only about half a minute. I allude to the reductions in the standard rate of the Income Tax and the reductions in the Super-Tax, amounting as they do altogether to £42,000,000 a year. I am not criticising the increase in the earned allowance, which absorbs altogether some £7,000,000. That increase we in the Labour Party support.

On a previous occasion I put before your Lordships many reasons why, in my view, these remissions cannot be justified in the present circumstances. I emphasised, in particular, a point which I should like to submit to the attention of the noble Earl who has just spoken, because I think it has a very close and important bearing upon certain figures which he gave your Lordships at the end of his speech, in regard to the total national Expenditure and the relation which that expenditure (that is, the total national Expenditure of the Exchequer and the expenditure on local rates) bears to the estimated total national income. I emphasised the point that you must look at the Budget as a whole when you are considering the relative positions at the present time, so far as national burdens are concerned, of the richer classes and of the poorer classes, and I pointed out that on the Expenditure side of the Budget the richer classes are now receiving somewhere about £300,000,000 a year in War Loan interest and in Sinking Fund payments. I said that taking that into account (and surely it ought to be taken into account) the richer classes to-day, looking at the Budget as a whole, are pretty much in the same position in relation to the poorer classes as compared with pre-War days.

I do not think that can be disputed if all the various figures are analysed. It is true that the richer classes are paying more; they are contributing a larger share of the national Revenue in direct taxation. It is also true that they are receiving a very much larger proportionate share of the national Expenditure. It is true that, taking everything into account, they are, as I have said, compared with pre-War days, in pretty much the same position as they were in relation to the poorer classes. Therefore I said that it cannot be argued, or if it is argued, it is an argument which cannot be sustained, that the richer classes are bearing too heavy a share of the national burden when compared with the poorer classes. Broadly, that was my case so far as the proportions of direct and indirect taxation were concerned. That is what I submitted to your Lordships in great detail. What reply was given from the Government Bench? No reply was given. Why was no reply given? No reply was given because no reply could be given, because what I said represented the facts.

I submit very earnestly to your Lordships that these particular points have not yet received the attention which they deserve, because they go a very long way to destroy the constant contention that the richer classes are bearing far too great a share of the national burdens. This sum of £300,000,000 of War Loan interest, and so on, amounts to the whole sum of the Income Tax and to nearly the whole of the Super-tax; so that, looking at the matter in that way—and it is the proper way to look at it—the richer classes are receiving back again from the Expenditure side of the account practically the whole amount they pay in Income Tax and Super-Tax. I do not wish to deflect from my argument at the moment, but later on I shall venture to submit that the figures which the noble Earl gave of the proportions of expenditure from the Exchequer and local rates are open to a good deal of criticism and that, if they are analysed closely and put in what I think is their right perspective, the result comes out materially different to that which he advanced.

It is quite true that throughout the Government have sought to justify these remissions of Income Tax and Super-Tax on the ground that they would help industry and that attitude is the basis on which the Liberal Party has largely supported this reduction of Income Tax. It seems to me that in this matter the position of the Liberal Party is inconsistent and illogical and cannot, indeed, be defended. This is not the first time the Income lax has been reduced under the plea of helping industry. It was done in 1922, when a shilling was taken off the Income Tax, It was done again in 1923, when another sixpence was taken off the Income Tax, so that 1s. 6d was taken off the Income Tax in order to help industry, as we were told at that time. What has been the result? Here we are to-day lamenting, as unhappily we must, the fact that the trade, and industry of the country are in about as bad a position as they ever have been since there was any trade or industry. Therefore, how can it be contended with any degree of force or truth that these remissions of Income Tax, which were made to help industry, have helped industry? If they have not, and it is quite clear that they have not, then what reason is there for saying that this further reduction of sixpence will be of any material benefit to industry? The whole proposition is demonstrably false.

This theory about the benefit to industry of reducing Income Tax has been put forward by the Government and by its supporters on so many different grounds that it is really very difficult to keep pace with them, but I think I am right in saying that their chief argument is this: It is necessary to increase the capital of the country in order to help industry and therefore you must reduce the Income Tax and the Super-Tax in order that the savings and the capital of the country may be increased. I will show the weakness of that argument. In the first place, a very considerable proportion of the remitted Income Tax and Super-Tax is not saved at all, but is spent. There can be no doubt about that. I pointed out on a previous occasion that a far more effective plan for helping industry in the sense of increasing capital is to pay off more National Debt.

Money devoted to Debt redemption is practically all saved. There can be no doubt about that.

At the present time the Sinking Fund amounts to £50,000,000 a year on a Debt of £7,646,000,000, in round figures say £7,500,000,000, so that the Sinking Fund amounts to two-thirds of one per cent. I is not enough at that rate. Moreover, it is a flat Sinking Fund, it is not a cumulative fund, and it will take 150 years to pay off the National Debt even if the Sinking Fund is not raided and, of course, it is quite certain to be raided before 150 years have elapsed. No Sinking Fund for National Debt has ever run anything like that period of time without being raided. I therefore suggest that the Sinking Fund ought to be increased to at least £75,000,000, which would make it one per cent, of the Debt. Even then it would be a smaller Sinking Fund than there was before the War when the Sinking Fund was about 1¼ per cent.

The noble Earl who has just spoken supported a similar proposition two years ago in another place. He supported the proposal that the Sinking Fund should be increased as soon as it could to £75,000,000, and in doing that he said of this proposal—

"I believe we could confer no greater boon on the financial stability of the country and the rehabilitation of trade."

That is how he described that proposal. I say those are true words, and they are as true to-day as they were two years ago. What I want to know is how is it that the Liberal Party have not supported this proposal which, in the words of their own leader, would confer such a great boon upon industry, instead of supporting the reduction of the Income Tax? If the reduction of the Income Tax is good for industry in the way in which the Government had argued, it is perfectly certain that the reduction of the Super-Tax will also be good for industry. If one is good the other also is good. You must support both or neither. I am quite unable to understand the position of the Liberal Party when they support the reduction of the Income Tax in order to help industry, but oppose the reduction of the Super-Tax. I say that is illogical and inconsistent. You must do both or neither. We are opposed to both. We do not believe these reductions will be of any material benefit to industry. We say that all past experience proves that. I think it is a great pity that the Liberal Party have got themselves into this position and have not adhered to the policy of paying off more Debt. That would help industry, while these proposals of the Government will do little or nothing.

At the same time, I am bound to say that I have a great deal of sympathy with the Government. For many months prior to the Budget, almost day by day, they were told by the Conservative Press that the one thing needful was to reduce the Income Tax in order to help industry. They were told that day by day with monotonous insistence. Accordingly, they reduced the Income Tax, and also the Super-Tax, which practically nobody was expecting them to do. Did they get any gratitude from the Conservative Press? Scarcely a syllable. Almost at once the same newspapers which had been saying, "You must reduce the Income Tax in order to help industry," dropped the idle pretence that it was of the smallest service to industry. Then they began to attack the Budget on the ground that it would injure industry, mainly on account of the new Pension? scheme. I agree with that criticism. I think the burden of this new scheme is bound to be harmful to industry, and Chat gives all the more force to the views of the Labour Party, which urged that the scheme should be non-contributory.

I should like, if I may, to say a word to the noble Lord, Lord Banbury of Southam, because on a previous occasion, in one of these financial debates, he said: "How can you make the scheme non-contributory? Where is the money to come from?" The money, of course, should come from this £42,000,000, which is being remitted to Income Tax and Super-Tax-payers. Very nearly enough can come from that source to make this scheme non-contributory and to increase the Sinking Fund. That would have this real advantage, that it would mean the rentier class was contributing its fair share to the cost of this Pension scheme instead of the whole burden of it being put upon industry. I think the rentier class should bear its share, and that we should not put the whole of this burden on industry. To do that at the present time is a most regrettable proceeding on the part of the Government. The financial and industrial situation of the country has never been worse, and my imagination fails to conceive what would have been said by noble Lords opposite if they had been sitting here and the Labour Party had still been in office under existing conditions. We should have had most denunciatory speeches about the way the Labour Party was ruining the country, and so forth.

As for myself I will try to be fair. I do not lay the whole of the blame for the present industrial and financial troubles upon the Government, but I lay some of the blame upon them, for they are certainly not free from blame. I have just been speaking of the burden of the Budget so far as it bears upon the unemployed problem. That problem is reaching a most menacing stage, and the Government simply look on helplessly, and do not seem to be able to do a single thing that will be of any real service in dealing with the situation. I think I am correct in saying that during every week this year, except one, the number of unemployed has shown an increase over last year. We drift from bad to worse, and the Government do nothing at all. I submit that it is becoming increasingly evident that the Labour Party was right when it warned Parliament and the country of the injurious consequences which would follow a return to the gold standard and, in particular, the long preparations for that return. On a previous occasion I showed to your Lordships that these preparations were bound to be injurious to the export trade. There is no dispute about that, and it is our export trade which is in such a very parlous condition at the present time. There are men in all Parties, including some leading Conservatives, who are of opinion that the gold standard policy of the Government is in no small measure the cause of many of our present troubles. Therefore, looking at all these problems as a whole, I say that the Government can by no means escape responsibility for the appalling condition of the country. Unemployment is going up and gold-edged securities are coming down, and there is a general lack of confidence prevailing throughout the length and breadth of the land.

The difficulties of the Government are somewhat increased by the ridiculous expectations they have aroused in certain quarters on account of their so-called safeguarding of industries proposals. I am not going to speak of them to-day, as I had an opportunity, shortly after the Session began, of examining these protective taxes and their probable effect. I fully endorse all that has been said by the noble Earl on this point and I am perfectly certain that experience will prove, as it has proved before, that the Safeguarding Duties or the McKenna Duties will all do far more harm than good.

There are one or two matters to which I desire to refer before concluding. The first question is that of national Expenditure. The noble Earl who has just spoken devoted a good deal of the concluding portion of his speech to that matter, upon which we had a debate some four or five weeks ago. I think it is clear that under the present Government there is to be no substantial retrenchment. This year, for the first year since the War, the Expenditure shows an increase, and thus one of the first achievements of the Conservative Government is to start an upward curve in national Expenditure. I hope the noble Lord, Lord Banbury of Southam, will not overlook this fact and that I shall hear no more from him of Labour extravagance. It is a Conservative Government that has reversed the salutary process which has been going on since the War, and I hope, therefore, that the noble Lord will restrain himself when he criticises the Labour Party.

I do not propose to go through again the figures of national Expenditure which were given by the noble Earl, but there are one or two points to which I should like to refer. He said that the national Expenditure is now £800,000,000 and to that you must add the expenditure on local rates which would make a total of £960,000,000. Then he said that the estimated total national income was £3,800,000,000, so that, speaking broadly, it might be said that the combined cost of the national Expenditure and local expenditure came to about a quarter of the estimated total national income. He went on to say that if you went back to pre-War days you arrived at a very different result. Then, he said, the estimated total national income was £2,500,000,000. It is with great diffidence that I question anything which the noble Earl says in regard to fiscal matters, but I submit to your Lordships, though I do not defend the Government on this matter of retrenchment at all, that we should get the true perspective and that his estimate of £2,500,000,000 as the pre-War national income in 1913 is rather high.

It rests upon the same authority as the other estimate.

I accept that, of course, from the noble Earl, though with some surprise, as I went into the matter very closely at the time. The authorities I consulted could not put the estimated national income then higher than £2,250,000,000. But that is not the main point. I certainly think that if the national income was £2,500,000,000 in pro-War days it is more than £3,800,000,000 now. Some authorities do put it higher than that at the present time. Personally, I should not put it higher than £3,800,000,000. The noble Earl also said that, taking the national income at £2,500,000,000, if you add together the national Expenditure and the expenditure on rates in the pre-War years, they come out at about one-ninth of the estimated national income; therefore, in pre-War days you were spending about one-ninth of the national income as against one-quarter now. The point which I think is most important in this matter is that the national Expenditure of £800,000,000 to-day includes £355,000,000 for the cost of the War Debt and National Debt and about £300,000,000 goes back to the wealthy classes of this country in interest and Sinking Fund. That £300,000,000, therefore, is really in the nature of a redistribution of national income. The total amount which went back on National Debt interest and Sinking Fund in 1913 was £23,500,000 as against the £300,000,000 which now goes back to the wealthier classes of the country.

My point is that this £300,000,000 ought to be deducted from the £800,000,000 of national Expenditure for the purposes of the comparison which the noble Earl made, thus bringing the Expenditure down to £500,000,000. Add to that the expenditure on rates, £160,000,000, and you arrive at a total of £660,000,000. I submit that this is the relevant figure to put against the £3,800,000,000 estimated national income, or somewhere about one-sixth, which is a very different figure to one-fourth. However, I will not again question his estimates, but if I were to go into that matter I submit that the probabilities are that the pre-War corresponding proportion, instead of being one-ninth, is probably about one-eighth.

There is one final matter to which I should like to refer. It is this. Throughout all these debates, and this is the fifth debate we have had on finance, I have not myself challenged the Estimates of the Chancellor of the Exchequer as to the Revenue for the current year, nor have I questioned the small surplus he expects to realise next March. For aught I know his Estimates may be right; at any rate, I have not challenged them. I remember very well last year moving the Second Reading of the Finance Bill from that box, and when I had sat down Viscount Grey of Fallodon rose from the Liberal Benches and made, not tentatively, but without any reservation or qualification whatever, the most direct criticism of the Budget on the ground that it was improvident; that Mr. Philip Snowden had no right to give away what he was giving away—the remissions of the Tea and Sugar Duties. The noble Viscount told your Lordships that there would be a "gap" this year and that it would be necessary to increase taxation this year in order to meet the demands of last year's Budget; that the gap between Revenue and Expenditure would be increased this year because of the remissions which Mr. Snowden the Chancellor of the Exchequer was then making.

That was what the noble Viscount told your Lordships without any reservation or qualification. No prophecy was more completely falsified than that, because, so far from there being a gap, the new Chancellor of the Exchequer found himself in a position to dispose of somewhere about £40,000,000 this year. It is quite true, as I have pointed out, that he is not disposing of it in the right way; but that is not the point. The real point is that the criticism of the Labour Government, made last year by Viscount Grey of Fallodon from the Liberal Benches, was just about as wrong as it could possibly have been. In regard to this Budget I make no prophecies about Revenue or surplus. What I say is that this is a Budget that will not help industry, that instead of decreasing our present difficulties it will increase them, and it is certainly a Budget which, judged by the best financial principles, is grossly inequitable.

My Lords, perhaps your Lordships will allow me, after the two speeches delivered on behalf of the two other Parties who form part of your Lordships' House, to say a word on behalf of the Government in reply. I fully recognise the great importance of the speech that was made by the noble Earl, Lord Oxford and Asquith, just now, and therefore I am sure that the noble Lord who has just sat down will forgive me if I do not dwell upon his condolences with the Conserva-time Party as to the iniquities of certain Conservative newspapers. I think the noble Lord reads those particular organs of opinion more carefully than I do, but I am quite aware that they are not friendly to the Government. I can assure him, however, that we do not disturb ourselves very much on that account. I will just refer to the noble Lord's remarks concerning the gold standard. I think that he must have observed the remarkable fact that, in the very full speech of the noble Earl, who is a great authority on finance, no word was said in reprobation of our having adopted the gold standard.

He supported you.

It is a matter of great satisfaction to us that we should have had support in that quarter. I am quite sure that the noble Lord who has just sat down would not have been himself prepared to face the disintegration of our exchanges which would have followed upon our shrinking from adopting the gold standard. Whatever he may say after the event, I feel confident that, had he been responsible for affairs, he would not have faced the consequences of that disintegration. I may add, with regard to the prophecies which were made about the gold standard, that one of them at least has altogether failed to be fulfilled. It was said that the gold would all be drained from this country.

Not at once.

There is no sign of it, no indication of it whatever, and therefore I hope that the noble Lord will not take too gloomy a view of our proceedings in that respect. I turn now to the speech of the noble Earl. I recognise that it was the last part of his speech which was of the greatest importance, and yet I must say a word or two, if he will allow me, in reply to his criticisms of the present Budget. He made a great deal, in his own sarcastic and humorous vein, of what he considered to be the falling from grace of my right hon. friend the Chancellor of the Exchequer. The noble Earl has returned to the position of an unadulterated Free Trader. All the old doctrinaire beliefs of his youth still survive in him, and not the changes of experience, not all the events of the War, not all the devices which the Liberal Party themselves were driven to adopt, have shaken his belief in that o doctrinaire position. I certainly do not belong to that way of thinking. I have never been able to understand why these questions of Free Trade and Protection should be looked upon as if they were religious dogmas which cannot be deviated from. The truth is that, in respect of this rigid Free Trade, the Liberal Party themselves have fallen from grace. Why, even the noble Earl is a sinner. Let him remember what the Liberal Party was responsible for both in respect of the McKenna Duties and the safeguarding of industries.

I had nothing whatever to do with the safeguarding of industries.

I said the, Liberal Party. A very important colleague of the noble Earl is Mr. Lloyd George. Was he not responsible for the safeguarding of industries?

As a matter of personal responsibility, I opposed that Bill in all its stages in the House of Commons.

The noble Earl, of course, might succeed before your Lordships in contrast with his colleague, but at any rate the Leader of the Liberal Party in the House of Commons is certainly up to the neck in responsibility for the safeguarding of industries. As regards the McKenna Duties, I agree that they were probably not imposed at the beginning for the purpose for which they were afterwards continued. They were imposed, no doubt, at the outset, in order to prevent the overburdening of the shipping of this country and for similar reasons; but they were continued for revenue purposes, and they were continued by a Liberal Prime Minister for revenue purposes over and over again, not in one year, but in repeated years. And he was perfectly right. Revenue purposes are very important in this connection, and they are the reason why we are continuing them to-day.

My right hon. friend the Prime Minister, speaking of the McKenna Duties the other day, said that the repeal of them by noble Lords opposite was an act of stupidity, a throwing away of revenue, and that they had been re-imposed by us for revenue purposes and for revenue purposes alone. There was nothing about Protection. Why should the noble Earl despise these revenue purposes? It is a question of£3,000,000 in a full year, and I must say, having regard to the great strain which is thrown upon the Chancellor of the Exchequer in these days—for I agree with a great deal that the noble Earl said—I cannot understand why he should grudge us this method of raising£3,000,000, which does not do anybody any harm whatever, merely because it has a protective effect. I do not know whether it really has a protective effect, and I do not care a bit. What we want is the money, and we want to raise the money without throwing a greater burden than we can help upon the shoulders of the taxpayer. We want to place the burden upon commodities or other sources of revenue in such a way that it will be felt as little as possible. These McKenna Duties are not felt. The kind of people who have to pay an extra duty upon motor oars do not feel it, but we get £3,000,000 without any extra friction or burden upon the taxpayer.

What is true of the McKenna Duties is also true of the Silk Duties. They are for revenue purposes and revenue purposes alone, and they raise £6,000,000 in a full year. I cannot understand the position of the noble Earl in this matter. I do not even recognise the Free Trade doctrine. I always thought that, whether you were a Free Trader or a Protectionist, duties for revenue purposes were admissible, that they violated no dogma and that there was nothing blasphemous about them. By the McKenna Duties and the duty on silk, we are going to raise in a full year no less a sum than £9.000,000. I say that is thoroughly defensible. I know that the noble Earl said that silk was not in a sense a luxury. It is very difficult to define what is a luxury and what is not, but what I think is certainly true is that the people who buy silk or artificial silk can afford to contribute to the revenue, and the fact that they buy silk and artificial silk proves that they can afford to do so. I am astonished, and if I may say so a little disappointed, that so great an authority as the noble Earl gives us no credit for attempting to tax sumptuary articles or luxuries. I should have thought that he would have welcomed it.

It always seemed to me to be the real method of taxation, in so far as it can be adopted, that you should place the burden as lightly as. you can upon the necessities of the people and the income of the people, because that income becomes fruitful when it is invested in industry, and that, you should concentrate as much as you can upon sumptuary articles or luxuries. I know, of course, that that source will not go very far, but as far as it does go I believe it to be correct finance and I am disappointed that the noble Earl did not support us in this respect. I do not want to say very much about lace. The noble Earl, in considerable passages on his speech, dealt with lace. He spoke of the safeguarding; of industries—of the method—as something which almost amounted to a breach of faith to the country.

I did not say so.

Then I apologise; I did not mean to misquote the noble Earl. I am glad that I was mistaken, because I think it is quite understood in the country, after the pledge given by the Prime Minister against Protection, that the safeguarding of industries, such as was indicated, was always excepted. Moreover, it figures in the King's Speech of last December. We promised in the gracious Speech a Bill for the safeguarding of employment in efficient industries where the need for exceptional action could be shown.

:. I never suggested to the contrary.

I am much obliged to the noble Earl. I misunderstood him, but it has been suggested in the country. At the same time that the Government said that they were not prepared to reintroduce a system of Protection in this country, they said that in particular cases—where exceptional difficulties were felt by industries of minor importance and where the result would be the disturbance of labour in that particular area or district or trade which would be very burdensome to the people—the Government were prepared, not being doctrinaires, to use fiscal methods for safeguarding those industries.

1 turn to what I will describe as the more important part—everything which the noble Earl said was of importance, but the most important part of the noble Earl's speech was that in which he spoke of industrial depression. I am sure your Lordships must have heard what he said in respect of economy with a great deal of sympathy. Certainly it was received with full sympathy on this Bench. We are firmly convinced that economy is essential in this country. We know, of course, as the noble Earl knew when he was in office and as noble Lords opposite knew last year, how very difficult in practice it is to carry out economy, but that economy must be practised and carried out we are quite as convinced as the noble Earl. I certainly am not prepared, although I have not had time to consider them, to reject the methods of economy which he suggested, but I should like, by way of comfort to the House and to the noble Earl, to remind the House what reductions of Expenditure there have been in the last few-years. I know that the noble Earl says: "You have raised Expenditure again." I am not looking at small matters, but I want to look at the big matter. I am prepared to give credit to the Labour Government for what they have done. Consider what the reductions have been. Expenditure has been reduced from somewhere about £1,000,000,000 in 1919–20 to something like £546,000,000 in 1923–24 and £407,000,000 in the Estimates for the present year. That is a very consider able reduction. Although I agree that the burdens are still far too heavy, we must not leave out of sight what has been done.

I presume the noble Marquess is now speaking only of Supply Services?

Yes, I am speaking of Supply Services only. I need not remind your Lordships also that the Chancellor of the Exchequer looks to a further reduction in Expenditure. The noble Earl says: "But why appoint a Cabinet Committee about it?" I confess I was rather surprised at that criticism of the noble Earl. He must know that when it is a question of one Minister compelling another Minister to spend less money he is enormously strengthened if he has a body of his colleagues to support him in that effort. I know that the noble Earl spoke of a sort of Draconian Chancellor of the Exchequer who was to 6tand firm, say "No," and force his colleagues to give way, but he himself knows that, although there have been such Chancellors of the Exchequer, yet even the sternest I ever knew, the late Lord St. Aldwyn, would have been enormously strengthened in his action if he could have spoken in the name of a Cabinet Committee of his colleagues when trying to force economy upon the Departments. Therefore I cannot think that the noble Earl was very serious when he criticised the method which we have adopted.

Yes, I was.

The truth is that the real method of staying industrial distress in this country is by greater effort on the part of all concerned

As the noble Marquess was speaking of the Cabinet Committee, may I ask him whether that Committee exists?

It has been decreed, but if the noble Earl asks me whether it is operating in the middle of a Session of Parliament, I frankly admit that it is not. He knows well that these things cannot be done when Parliament is sitting, and when Ministers have little leisure. I pass to the most important part of the speech of the noble Earl, that in which he spoke of the actual industrial depression through which we were passing. That is not to be met merely by economy. Believe me, essential though economy is, economy will not do the trick. There is not the capacity, if we made all the economies that are feasible, to produce a really vital change in the industrial depression in this country. I think sometimes that Members of Parliament and statesmen who have been engaged in Parliamentary work all their lives get an exaggerated belief in the powers of Parliament in matters of this kind. They think that a little change in the law, a little modification of the Budget, a little economy in the Departments, is really going to make a vast difference in a condition such as we see now before us in the industries of this country. No; the industrial condition of the country can only be remedied by effort, and by effort of all concerned. What the Government can do is really limited. But this they can do. they can inspire all concerned with confidence. That is the main thing they have to do, and that is what we are trying to do.

The noble Earl spoke of the cost of the Pensions scheme of the Government. Well, it is very heavy. I should like parenthetically to remark that if the noble Lord opposite had his way and the Pensions scheme was non-contributory the cost would be much heavier till, lie would increase the charge about £20,000,000 a year now and it would rise to £40,000,000 within a limited number of years.

If I may interrupt, the point which the noble Marquess is making is not one that will bear very close investigation. As a matter of fact, the amount which is being given away by the Government this year is £42,000,000 and that would be sufficient even to find the cost of the present? scheme plus the extra £20,000,000 of which the noble Marquess speaks. The cost would grow, it is true, but that would be met by the decline in the cost of War Pensions and therefore the thing would be about square.

Of course, it is quite easy, with the dexterity Of the noble Lord, to show that if you saved on some other head you could meet the charge.

It is automatic.

But I am quite correct in saying that the difference between the contributory Pensions scheme and the non-contributory scheme is a difference of £20,000,000 now and it would rise to £40,000,000 hereafter. But I return to my point. The cost of Pensions is very heavy indeed, but it belongs to the policy of increasing the confidence and therefore the effort of the working class. We give them security. We give them security in respect of their wives in case they themselves should be cut off. We give them security because they will become entitled to a pension five years earlier than the law provides as it stands. And we give them self-reliance because we insist that they themselves should be contributors to the Pension scheme. The object of the whole of that policy is to give confidence and security to the working class and so increase their desire to make the necessary effort. That is, to us, absolutely vital and it is in exactly that spirit that we have done what the noble Earl praises us for doing—namely, reducing the Income Tax. It is because we want the employing classes also to make an effort, to make a supreme effort, to increase the spirit of enterprise.

The noble Lord just now gave some very interesting figures to show that, after all. the distribution of burden was not unfair as between the different classes of society in this country. I really am not interested in that point for the moment. What I want to know is what will increase the spirit of enterprise in industry, what will induce the employing classes to make the necessary effort, and the fact that they receive an interest upon their investments in War Loan does not bear upon the point, even if it were all true, as the noble Lord says, which I do not admit altogether. What we are advised is this, that taxation by way of Income Tax and Super-Tax hitherto has been so heavy that people engaged in industry hardly think it worth while to launch out into anything new. The return is so small that it is not worth their while. No doubt, if they acted with sufficient public spirit, they would not be restrained, but, unfortunately, one cannot rely upon public spirit altogether. Looked at from the point of view of private gain, a large number of these persons hardly think it worth while, and it was for that reason that the Government reduced the Income Tax. It was for that reason that they reduced the Super-Tax, too. The noble Lord was surprised that we reduced the Super-Tax. He seemed to think that because the cheap Press have not suggested to us that we should reduce the Super-Tax it was quite wanton of us to do so. We do not take our policy from the cheap Press. We reduced the Income Tax and the Super-Tax because we believed that we should thereby increase enterprise, and for that reason only.

It is only upon that basis that any real way out of the difficulty is to be found. Effort is the only way, effort is the successful way. And we urge this upon all those who are interested in the country. All we can do is to help it forward by restoring confidence, by giving hope, hope to the working class, hope to the employing class; and then, if they will make the necessary effort, all these difficulties, all the gloomy prognostications of the noble Earl will vanish like a mist. It does not want so very much more effort, but it does want a certain amount of effort, just to increase the output of the country, just to reduce the cost of production, just to make it possible for us to compete in the foreign market.

The cost of production cannot be reduced except by superior organisation, or by lower wages, or by longer work, or by better work. I do not suggest lower wages —I should be very sorry to see lower wages—but I should like to see longer work, and I should like to see better work. I believe it to be true about a large part of the working class of this country—not all, but a considerable part—that a sort of paralysis has overcome them. Love of recreation, it may be, or a feeling that, after all, it is not worth while to exhaust oneself in effort. And so, in a measure, they sit with folded hands, and do not make the necessary effort; and yet it is only by that effort that the thing can be achieved.

indicated assent.

I am glad that the noble and learned Viscount agrees with me. And therefore, when you criticise the Budget, and say: "Why spend so much in pensions?" or "Why reduce the Income Tax?", according as the criticism comes from the Liberal quarter or from the Labour Benches, our reply is the same: Our object is to increase the confidence of those who are engaged in the industry of this country. Confidence, we believe, will beget effort; effort will beget enterprise; and by that means, and that means alone, shall we redeem our country from its present position.

My Lords, after the very important speeches to which we have listened, it is with some diffidence that I ask you to listen for a few minutes to some remarks from one who has been practically engaged in finance and industry. I should like to refer to one remark of the noble Lord, Lord Arnold, with which I am able to find myself in some agreement. He said that he did not think that sixpence off the Income Tax would do very much good to trade. I am inclined to agree with that, and I am inclined to agree further with him in saying that the small reduction in Super-Tax will not have very much effect either. What I think would have had a considerable effect upon trade would have been if the Government, instead of making a reduction in Income Tax, had used that money to cut the Super-Tax in half, as they could have done. I notice that the noble Lord opposite laughs. It is a ridiculous suggestion no doubt, but it would have had an effect on trade and this will not, in my opinion.

If I might make somewhat of a bull I think the best part of the Budget was the speech with which it was introduced and the best part of a very good speech was that part in which Mr. Churchill dealt with the Super-Tax. As that is the point to which I should like to call your Lordships' attention, and as Mr. Churchill's language is very much better than any I can employ and of course he speaks with much greater authority, I would ask to be allowed to quote one or two of his remarks, although it may not be strictly in order to do so:—

"The burden of direct taxation falls with injurious effect upon the enterprise of the nation. It is a delusion to suppose that the evil is confined to the classes who actually pay. It manifests itself in all sorts of … ways; it manifests itself above all in a contraction and relaxation of effort and in the loss of saving power. Thus the evil descends, tier by tier, in varying degrees upon every class of the population, and it reveals itself, I am confident, to some extent at least, in the present grave and exceptional unemployment from which this country is suffering."

The Chancellor of the Exchequer went on to say:—

"I believe that the Super-Tax at its present rate constitutes an excessive burden both on the enterprise and the saving power of the nation, and that it is an impediment to the creation of that new wealth without which our present load of Debt and Expenditure cannot be borne."

Unfortunately, Mr. Churchill did very little to carry out his excellent views, and what little he did he balanced by an increase in Death Duties. It was a further misfortune that, as he did so little, his admirable arguments attracted very little attention.

In my judgment, the remarks which I have read to your Lordships ought to be written in letters of gold or, to use a more modern method, broadcasted, because they are not generally understood in the country. Mr. Churchill did. not overstate the case. Super-Tax and Income Tax have almost entirely stopped new enterprise. No one will risk his money, as the noble Marquess below me said, when the loss falls upon himself and the Government takes up to nearly half of the profit and up to 40 per cent, of the balance when he dies. If your Lordships would make inquiries you would find that even those who do not pay the highest rate of Super-Tax will not take risks because the rate of taxation is so high; and investments are now almost entirely in stocks of Governments, Loans of Governments, Debentures and Preference Shares, and the investments in ordinary shares are a negligible quantity. My noble, friend Lord Banbury would confirm this, I am sure.

Superfluous income, which is the subject of these attacks, is superfluous, no doubt, so far as the owner's comfort is concerned; but it is an essential part of the mechanism of trade. It is only from superfluous income that any savings can be made, and it is only superfluous income that can be justifiably risked in new enterprises; while it is only by new enterprise and from new markets that, we can hope to maintain our excessive and in- creasing population. In case your Lordships should think that our present position is not sufficiently depressing, even after the speech of the noble Earl, Lord Oxford and Asquith, I should like to give you some figures compiled by Professor Hewins, whose statistics I think your Lordships will respect. Apart from those employed in schemes for giving work to the unemployed, he takes the numbers on the unemployed register on March 16 last—no doubt they have greatly increased since then—and adding thereto the number in receipt of Poor Law relief on a day in 1923 (which I presume was the last figure available) he calculates that there were over 2,750,000 supported by the State.

Besides the schemes, municipal and otherwise, for relief works your Lordships must remember that manufacturers very often take orders at a loss so as to keep their men together and employ them. As a matter of fact, I had a message this morning from the North British Locomotive Company, who told me that for that very reason they had accepted an order for 35 locomotives and tenders for Egypt at a great financial sacrifice. Mr. Hewins further calculates that on the basis of 1913 prices our exports diminished in 1924 by 24½ per cent, as compared with 1913. In face of those figures, can any one say that new enterprise and new markets are not required? It must be remembered that our present exports are greatly due, not to the excellence of our manufactures, as we are always told, but to the influence of British capital which is invested in enterprises which require them, and the more those enterprises can be increased the greater will be the demand for British exports. Your Lordships will remember that Messrs. Furness, Withy accepted tenders earlier in the year for five ships from abroad. The really striking point about that transaction was not that British shipbuilders lost the tender, but that Messrs. Furness, Withy, with their British capital, were willing to pay £1 a ton to assist British shipbuilders to secure the contract.

Now, however, with the present attacks on wealth, the amount available for investment is steadily falling. About this time last year I reminded your Lordships that the amount available for foreign investment was estimated by the Board of Trade at £181,000,000 in 1913 and at £97,000,000 in 1923. I see that for 1924 this amount is calculated at less than £30,000,000. These figures are arrived at, as your Lordships know, by taking the balance of imports over exports, and setting against it what are called invisible exports; that is to say, freights, services and commission. So the figures represent, at least for purposes of comparison, the savings of the country, and when you see that these figures have fallen from £181,000,000 in 1913 to less than £30,000,000 in 1924 in a currency of less value, and when you remember that the population has increased considerably in the meantime, I think it will be agreed that they are disquieting, to say the least of it.

There are, of course, ups and downs in trade, but the alarming fact is that the tendency is steadily downwards and our present position is not a crisis properly so-called; it is, in my judgment, the inevitable and foreseen result of the unfavourable conditions which exist in this country, amongst which are the attacks on the accumulation of wealth and enterprise. I might point out also that the depression here is not due, as we are so often told, to the War or to the failure of purchasing power abroad, because almost every nation except our own is improving its position daily. There is practically no unemployment anywhere but here, which means that other nations are producing as much as they can, either for their own wants or for export, and therefore are well able to buy. The fact is that since the War the mass of the people have not taken their share in the recuperation of the country, and have thrown it more and more on accumulated wealth and enterprise with the inevitable result that trade, by which alone the people can exist, is falling off every day; and they refuse competitive wages.

Just think what the position of this country is 43,000,000 of people living in an island which only provides half the meat and 20 per cent, of the bread stuffs required for their support, and the trade by which they should obtain the balance of their food falling away. Is it not time to cease arranging our taxation on the basis of sentiment—casting the burden on those best able to bear it—and to take as our only principle so to levy taxation as to inflict the least injury possible on the permanent interest of the nation? The population of the world was estimated at 750,000,000 in 1800, and is now estimated at 1,750,000,000 and it does not require a prophet to foretell that just as last century was a struggle for wealth, this century will be a struggle for existence, and in that struggle we shall stand to lose more than any other nation because we cannot feed ourselves. As I see it, subject to your Lordships' better judgment, the preparation which we are making for the struggle is, from the moral point of view, to undermine the fine character of this people by "doles" of every description from the cradle to the grave, and, from a material point of view, to check enterprise and reduce savings by which alone the people can live.

My Lords, I beg to move the suspension of Standing Order No. XXXIX.

My Lords, at this very late hour I shall only occupy your Lordships' time and attention for a very few minutes on the Bill of which I now move the Second Reading. The object of this Bill is to provide a pension scheme for those whole-time firemen who are not at present covered by any pension scheme. There have been numerous schemes, some of which are in operation at the present time all over the country, but this Bill is the result of the deliberations of a Committee, and afterwards of a Royal Commission, which reported on the matter in 1923. This Bill practically is based on that Report. I do not think it is necessary for me to go in detail into its provisions, because the circumstances are such that I do not think your Lordships will be unwilling to give it a Second Reading It left another place in its present form, practically as an agreed measure—that is to say, the promoters now have the support of the Government, and the Bill is an agreed measure with the local authorities. I am sure that your Lordships are willing to recognise the spirit of self-sacrifice of our firemen and also the dangers and risks to which they are subjected, and you will no doubt agree with another place that both they and the police should have adequate pensions as a reward for those sacrifices and for undertaking those risks.

The Bill in its present form applies to Scotland. There were the names of two Scottish members on the back of the Bill. During its progress through the House of Commons overtures were made to the representatives of local authorities so that they should not continue to have any grievance to which they felt themselves subjected. No opposition, however, was-offered to the Bill in another place on behalf of the Scottish authorities, and an Amendment excluding Scotland was not even moved. The author of the Bill, which is now a Government measure, offered to meet all the Scottish local authorities, but they did not happen to accept his invitation, and no further objection was taken to the Bill. I have had private information that on behalf of Scotland certain objections may be made, but, as I have indicated, they had in another place the very fullest opportunity of stating their case but did not do so. Therefore, I take this opportunity of moving the Bill as an agreed measure. If your Lordships should be willing to give it a Second Reading, and we can get it through the Committee stage in a moderate amount of time, the idea is that the Bill should come into operation in April of next year. I beg to move.

My Lords, earlier this afternoon we listened to a speech from the noble Earl, Lord Oxford and Asquith, in which he pointed out how great was the necessity for economy, and how enormous was the burden which was imposed at the present moment upon the taxpayer and ratepayer. Unless my memory deceives me, I think he said that the rates alone amounted to something like £150,000,000 a year and the total annual burden to something very like £1,000,000,000. I believe I am right in saying that my noble friend Lord Salisbury said that the chief idea of the Government was in some kind of way, and in the best way that they could, to reduce expenditure, and so lessen taxation and rates. This Bill is a very good illustration of what is going on.

I dare say it is a very good Bill, provided we had the money to do what it proposes to do. It proposes to compel local authorities to pay a certain rate of pension, based, as I understand, upon what is paid to the police, to firemen. Lord Desborough is a little wrong when he says that this is an agreed Bill, because I hold in my hand a memorial from the Convention of the Royal Burghs of Scotland in which they object to the Bill altogether, and wind up by saying that on the whole they do not think it should be passed; or, alternatively, if it is proceeded with, that it should not be made to apply to Scotland. It is evident that the Scottish people, at any rate, with their natural love of economy, are opposed to this Bill.

I want chiefly to show to your Lordships what actually is going on at the present time. It is nothing new. During the many years that I was n the House of Commons I always found everybody there was in favour of economy, except in their own particular constituency or in some particular thing in which they had an interest, and then nobody was in favour of economy. The same thing is going on to-day. We are continually having these little Bills brought before us. I do not suppose this particular Bill will impose a very great burden upon local authorities. It is the principle to which I object. Instead of seeing whether or not we can give increased pensions to various people, increased "doles," etc., we ought to say to everybody that we are going to reduce our expenditure, and that we certainly are not going to put anybody in a better position than he was in before at the expense of the State. This comes just after we have listened to a powerful speech by. the noble Earl, Lord Oxford and Asquith, confirmed, as I understood, by the noble Marquess, Lord Salisbury, with regard to national economy. We are asked to compel local authorities, who already have powers, to give pensions, increased pensions, to firemen. Firemen have done very well up to this year, and why on earth should ratepayers be asked to spend further money in this direction?

And, by the way, this is a private Member's Bill, which has been taken up by the Government. I always objected, when I was in the House of Commons, to the Government giving facilities to private Members' Bills and then taking them up as their own. This is a private Member's Bill, probably because the tire-men in his constituency have said, "If you bring in a Bill to give us more money out of the public expenditure we shall probably vote for you next time." Probably that is the whole reason for the Bill. I know it is no use trying to stop the Bill if the Government are in favour of it, but I earnestly ask the noble Marquess the Leader of the House 'o endeavour to put a little backbone into the Government and prevent them bringing forward all these popular measures of social reform, which is but another phrase for Socialism, and try to relieve the unfortunate Income Tax and Super-Taxpayer, and the taxpayers generally, because, unless they do that, the noble Earl is absolutely correct in saying that we are on the road to bankruptcy.

My Lords, I do not rise to oppose this Bill but simply to ask a question, and I do not desire an immediate reply unless the noble Lord is able to give it. But it would be interesting to many of us if he could tell us how much money this Bill is expected to cost. I am quite sure that the figure is somewhere in the Department, and if, on the Motion to go into Committee, it could be given to us we should be very grateful.

I think I could give the figure roughly now. This is not a Bill to increase pensions but to give pensions to those unfortunate whole-time firemen who have not pensions at the present time whilst their confrères have; and it is introduced as the consequence of a Committee and a Royal Commission. I understand that the number of these unfortunate whole-time firemen is not more than 700 or 800. They will be pensioned. The rateable deductions are to be five per cent, and I am informed that the amount which local authorities will have to find will not be more than two per cent, over and above the rateable deduction of five per cent. The noble Earl, who is a mathematician, can possibly work out the cost; at any rate, he can be quite sure that it is not a big amount and we are only doing justice to a body of men who at present are outside the pensions scheme.

I will repeat my question on a later occasion.

moved, as an amendment, to leave out "be approved" and to insert—

"be referred to a Select Committee to con-skier and report:—

1. Whether the matter has been sufficiently dealt with by a departmental inquiry or inquiries.

2. Whether an opportunity ought to be afforded for petitioning against the Order.

3. Whether, having regard to the answers to the preceding questions and to the findings, if any, of these inquiries and to the other circumstances of the case, any amendment of the Order is desirable, or whether there ought to be a further inquiry by a Select Committee.

May I ask the noble Marquess if an opportunity will be given to those who object to the Order in its present form to appear before the Committee and state their case?

That is quite understood.

And that these Amendments will all stand over until the Committee meets?

That, of course, is for your Lordships to decide. Might I add to that which I said to my noble friend opposite, that the matter will be in the hands of the Committee? If they think there is no reason why the parties should be heard, and that the matter has really been decided, no doubt they will so report to your Lordships. I thought for the moment that my noble friend was referring to the Amendments which are upon the Paper. I can assure him that all his own views will be carefully considered.

I was referring only to my own opinion.

My Lords. I should like to be allowed to say that I welcome very much that part of the remarks of the noble Marquess the Leader of the House in which he said that he did not propose, in moving this Amendment, that the machinery which it is proposed to set up should be hampered, and his further remark that he hoped that this Select Committee which he proposes to set up will act without undue delay. I think that one has to bear in mind that this Order which appears upon the Paper is the result of an Act which was passed six years ago, the last legislation on the subject being dated three years ago, and therefore it seems to me that it would be unfortunate, if the policy of those Acts is to be carried out, if this machinery were not set up without unnecessary delay. After all, it cannot be expected to be the subject of additional confidence to an important industry like the electrical supply industry that it should be left for a very long period in a state of hesitation and doubt as to the lines upon which it is in future to proceed, and I should like therefore to appeal to the noble Marquess to use his great influence to see that this Committee, if set up, will move quickly and deal promptly with this matter. I should like to suggest that it will act before the end of the Session.

Very rapidly indeed, I hope.

My Lords, I should like, if I may be allowed, to associate myself with that which has fallen from the noble Earl. I do not want to repeat what has already been said. The noble Marquess is aware of the urgency of this matter, an urgency which is being felt by all the local authorities in London as well as in the country. I suppose that it is not possible, under the third part of the Amendment of the noble Marquess, to deal with the Amendments upon the Paper summarily. I had almost hoped that it might be. But I would ask the Committee to remember that the Act of 1919 promised a cheap and abundant supply of electricity to Londoners, and that now, after three or four years of negotiation, we have nearly arrived at that result. If this Committee can enable a joint electricity authority to be established before people depart for the summer holidays it will be a great advantage, at any rate, to the population of London.