SUPPLY —THE BUDGET.

HC Deb 03 December 1852 vol 123 cc836-920

Order for Committee read.

The CHANCELLOR OF THE EXCHEQUER

Sir, though the House has been pleased to honour the remarks which I have to make to-night with the title of "Financial Statement," and though I am indisposed, under any circumstances, to quarrel with the humour of the House, still I trust that hon. Members will have the kindness to recollect that it is a financial statement which has to be made under very peculiar circumstances; and, Sir, although we have, with respect to our finances, to consider to-night some very important topics—whether, for example, it is possible to make such changes in the mode of levying our revenue as may contribute more to the satisfaction and welfare of the community; whether such alterations can be effected in our method of taxation as may remove from various classes not an ill-founded sense of injury and injustice; and, above all, whether we may not take this opportunity of establishing our financial system upon principles more adapted to the requirements of the times, and especially to the industry of a country pre-eminent for its capacity for labour— still, besides these, there are other topics to which I must advert, and which are not strictly of a financial nature. I hope the House will also remember that, even considering the remarks I have to offer to their consideration merely in a financial point of view, at the present moment we are only arrived at the completion of about two-thirds of the financial year—a circumstance which naturally adds to the difficulty I have to contend with. I hope, therefore, that under these circumstances hon. Members will not think it any evidence of conceit or affectation on my part if I do not on this occasion rigidly follow that routine form of exposition which a Chancellor of the Exchequer usually adopts at the termination or commencement of a financial year, when his duties are comparatively limited, and, I may say, comparatively simple; but, if I deviate from that course, I trust that they will attribute my proceeding to no other motive but a desire on my part, in dealing with these various important, and, in some cases, complicated subjects, to explain clearly to the House the views of Her Majesty's Government upon subjects of such great importance, and, so far as I have to touch upon the point, their opinion on the condition of the country. Sir, the task I have undertaken is, as the House is well aware, not a light one under any circumstances, and even under ordinary circumstances requires an appeal to the indulgence of the House. I am sure to-night I shall receive its generous indulgence; and the only favour I presume to ask of hon. Gentlemen on either side is, that they will not precipitately decide on any proposition which I may make, but will consider all that I offer as a whole, because as a whole it ought to be considered; and I trust that, in justice to myself, they will not, until the views of the Government are fairly placed before them, be carried away by any feeling of the moment, on whichever side they may sit, too precipitately to decide on the motives and principles of the policy which I may now have to set before them.

Sir, we wished after the event of the last general election, understanding as we did from the result of that election that the principle of unrestricted competition was entirely and finally adopted as the principle of our commercial code—we wished to consider our financial system in relation to our commercial system—to see whether they could not be brought more in harmony together, and whether, in bringing them more in harmony together, we might not remove many well-founded causes of discontent among the people of this country, and lay the foundation of a system which in future should not only be more beneficial, but which should enlist in its favour the sympathies of all classes. Before, however, I take that general view, I think it will be convenient that I should consider the claims of those who believe that by what we now familiarly describe as "recent legislation" they have received peculiar injury. It will, I think, be for the convenience of the House that we should dispassionately consider the position of those classes,! and come to an opinion whether their complaints and claims are just or not—because, if we can arrive at some conclusions on these points, those classes who now assert that they have been injured by recent legislation, if their claims are impartially heard, and, if established, fairly met, will then merge in the mass of the community, and we shall hereafter have to consider no other claims than claims which represent the unanimous voice and feeling of the entire nation. Therefore, I repeat, it will not be an inconvenient course if I take the earliest opportunity of examining the claims urged by those great interests which have been peculiarly affected by recent changes in our commercial law—the shipping interest for example, the sugar-producing interest, and the agricultural interest—so far as the latter, irrespective of all other pleas, urges on the consideration of the House the fact that it is subjected to peculiar burdens and taxation. When we have discussed these three important claims—when we have arrived, as I hope we may arrive, at a general, if not an unanimous, opinion on the course we ought to take with regard to them, we shall then have terminated all appeals on behalf of peculiar burdens and grievances; we shall then be able to take an unembarrassed view of our financial position, undisturbed by sectional appeals to our feelings or to our sense of justice, and we may be enabled to arrive at some permanent conclusions, which may form the basis—and the beneficial basis—of the financial system which ought to be adopted and developed in this country hereafter.

Sir, I will, in pursuance of the plan I have thus sketched, proceed to consider the claims that have been urged on Parliament by the shipping interest in respect of the burdens which it endures and the grievances which it experiences—burdens borne under our previous commercial system without any overwhelming sense of their weight—burdens not of a nature, in fact, to require our interposition so long as they were mitigated by the privileges which we have now terminated. I have listened with great attention to all the representations that have been made to me with respect to the shipping interest; and I say now with respect to the shipping interest what I would say with regard to any interest that believes itself subject to regulations and laws entailing on it burdens which other classes of the community generally do not endure— that it will be wise for Parliament to approach the discussion of these matters in a generous spirit, I do not want, and am not desirous myself in any way that we should attempt, by any proposition we bring forward, to conciliate sympathies to which we ought not to defer; and least of all am I anxious that the House of Commons, so far as I can direct its opinion, should, for the sake of silencing a claim which they may not consider just, enter into any arrangement which ultimately they might think was not a sound and proper one; but of this I am certain, that nothing is more unwise, that nothing is more prejudicial to the country generally, than that considerable classes of Her Majesty's subjects should consider that they are liable to regulations which injuriously affect their industry, and from which the rest of the community is free, and that they suffer from the injurious effect of those regulations, in consequence of changes in the law which have universally contributed to the advantage of the remainder of the community. I can conceive no state of society more to be deprecated than one in winch there are minorities, but powerful minorities, who believe that they are subjected to injustice, in consequence of changes in the law contributing to otherwise universal welfare. Therefore, it is my opinion that, if there be on the part of the shipping body, or on the part of any other class in this country, well-founded claims to the consideration of Parliament, it is highly expedient, not only in the interest of public morality, but from the most utilitarian considerations that could possibly occur to the most unsentimental minds, that we should enter into these questions, ascertain their merits, and decide accordingly. Now, Sir, with respect to the shipping interest, I may say this on behalf of Her Majesty's Government, that, having investigated with great pains, and listened with great patience to their case, the Government are of opinion that the shipping interest, principally through the consequences of recent legislation—namely, through the repeal of the navigation laws— are at this moment subject to burdens to which they ought not to be liable, and to restrictions which (to use the words of the noble Lord the Member for the City of London) "impede their prosperity." If this be so, and if it be the opinion of the House of Commons that it is so, I think it much better that we should meet that case, difficult as it may be, in a just and liberal spirit, and see if we cannot remedy the complaints of so influential, so important, and so worthy a body as the shipping interest and the classes connected with them. Now, we have examined shipowners and persons in the classes connected with them (all those, indeed, comprehended by the not very accurate but still popular title of the "shipping interest," which title I use because it is one to which the House is accustomed)—we have examined all those persons, and they complain that they are subject to vexatious taxation under the head of light-dues and passing tolls. They complain of the present system by which the pilotage of the country is regulated. They also greatly complain of what they describe as Admiralty grievances—of the circumstances under which an individual belonging to the mercantile marine is enlisted into the Royal Navy; of the system under which salvage is established; and of the regulations under which anchorage takes place. They have great complaints as to the restrictions on the manning of their vessels; as to the stamp duties levied on marine insurances, bills of lading, and charter-parties. Now, if the House will permit me, I will touch on these subjects, and explain what would be, in the opinion of the Government, the manner in which these complaints ought to be met; and, as the recommendations we are about to make are founded, I think, on an impartial and liberal consideration of the whole case, we believe that, if those recommendations are adopted by Parliament, we may fairly say that the just claims of the shipping interest will be satisfied, and that in our future legislation, so far as that interest is concerned, we shall not be disturbed by appeals of a class nature. Now, Sir, with respect to the light-dues, we have examined the subject, and it is our opinion that in a great degree the complaints of the shipping interest are founded in fact. It certainly seems quite indefensible that, irrespective of the dues which they pay for the advantage of lighthouses, which are certainly, as I think, amply and properly supplied in this country, they should be paying in the form of dues a large sum of money, which is, in fact, the interest paid to the Trinity House for the purchase of private lights, which were improvidently granted by the Crown or by Parliament many years ago. As far as that portion of the light-dues which consists of the interest paid on sums advanced by the Trinity House for the purchase of these private lights, it seems to us indefensible that, when the principle of unrestricted competition' is established, the shipping interest of this country should be paying a tax not for the lights supplied for their benefit (because for them they pay sufficiently), but in order that improvident grants of former Sovereigns and Parliaments should be counteracted by a peculiar tax raised from them, and in respect to which they get no return whatever. We think, also, that all that which is levied from the shipping interest under the name of "passing tolls" is a vexation, a grievance, and a burden, to which the shipping of this country, under present circumstances, ought not to be subjected. We think it, too, highly inexpedient that, under the name of light-dues, the shipping of this country should be taxed to maintain the charities of a corporation; and, taking these three conclusions to guide us, we shall be prepared to deal with the light- dues as at present existing. We would confine the tax on shipping merely to a payment for that benefit which the shipping receives from the lighthouses; we would relieve the shipping interest from what is paid for the interest upon those loans incurred to purchase private lights; from the contribution to the charities of a corporation, which, however laudable they may be, ought not to be maintained, under present circumstances, by taxing a British ship; and, finally, we would relieve the shipping interest from all passing tolls. Sir, I estimate that this settlement of a long-agitated question will probably cost the country about 100,000l a year; but it appears to me that the claims are just; that it is impossible to resist them, and that they ought to have been considered when the repeal of the navigation laws was agreed to. The next question to which I would refer is the question of pilotage. The system by which pilotage is regulated in this country is extremely anomalous. It is quite unnecessary on the present occasion for me to enter into the origin of these anomalies. The subjects of which I have to treat to-night are so various, and some of them so complicated, that perhaps the House will allow me to say, once for all, that I shall not attempt to enter into any argument on any of them, excepting so far as it may be necessary to do so in order to make my meaning clear. I confine myself to-night to the exposition of the policy of the Government. There will be occasions when in detail we may enter into argument on all these various questions; but at present I consider it my principal and almost only duty clearly to explain to the House the policy recommended by Her Majesty's Government on all these different subjects. I will not, I repeat, enter into the question of the origin of the anomalies of our system of pilotage. The House, I am sure, knows well that a Thames, pilot can steer a ship to a Cinque port, but he may not steer it back. Another pilot connected with another corporation performs the duty of returning; and, of course, the shipping interest having to employ two men to perform a duty which one man could discharge, the expense is proportionately increased, and the burden in many cases is found to be excessive. There has been a Committee of the House upon Pilotage, hut it is a great many years ago; its investigation, however, is vory worthy of attention. But I think, although myself always disinclined to avoid responsibility by proposing Committees, that there are occasions on which a Committee of the House of Commons can effect very great good; and I think it would be very advantageous that upon the whole question of pilotage and ballasting the feelings of a modern House of Commons should be consulted, animated by those views with respect to commercial affairs especially, which probably had not so great an influence years ago—that a Committee of the House of Commons should investigate this subject, and report to the House. It is the intention of the Government to recommend to the House that there should be a Committee appointed to inquire into the whole subject of pilotage and ballasting, and I have myself no doubt that the result of that Committee will be satisfactory. I come now to those grievances which I have described as "Admiralty." The House is aware that when a merchant ship finds herself on a foreign station, it frequently happens that one of the crew, without any ceremony, quits the captain without any notice, and often without any cause, and immediately enlists in a ship belonging to the Royal Navy that happens to be upon that station. This right and privilege act very injuriously upon the discipline and general conduct of the merchant shipping. I am myself most anxious not to diminish the just privileges of the Royal Navy—that force upon which this country mainly depends; and I certainly would not propose any change which would in any way affect the necessary powers of the Royal Navy. But, with respect to this first grievance, which, I believe, from the representations that are made to us, is one of an extremely vexatious character, we propose—while we are prepared to maintain all the necessary privileges in this respect of the Royal Navy—that no man quitting the mercantile marine under such circumstances shall receive his wages, which then are due to him, until the rest of the crew of the same ship are paid off. At present he can, at a moment's notice, notwithstanding his engagement with his master, hoist his red shirt, enlist in the Royal ship that may be in the offing, and demand his wages; and the captain of the merchant ship not only loses one of his crew, but is called upon immediately to pay wages which would not have been due until the vessel arrived in port. We propose, that if he avails himself of this privilege of enlisting in the Royal Navy, he shall not receive his wages until the rest of the crew are paid off. We propose, further, that if by the Royal Navy availing itself of this privilege any injury is done to the captains of merchant ships, the country must be prepared to compensate the captain of the merchant ship for the injury he may thus receive. The next Admiralty grievance which has been brought before us relates to the question of salvage. For the reason which I have already expressed—namely, the necessity of my avoiding as much as I possibly can detail to-night, when so many subjects are under our consideration, I will not enter into the question of salvage, as it affects the mercantile marine. I am quite sure I could state cases to the House as to the operation of the present system under which salvage is conducted which would show that the mercantile marine is grievously affected by it. I think we ought not, however, for a moment to indulge in a feeling that the Royal Navy is to be charged with reprehensible conduct in this matter. I have no doubt? myself, from all I can observe and learn, that the conduct of the officers of the Royal Navy, especially of late years, has been distinguished by a general sympathy with all classes of their countrymen, which cannot be too highly praised. I have no doubt that in the Navy as well as in all departments of life much more humanising tendencies are exerting their influence than there did 25, or 40, or 50 years ago. But the system remains, notwithstanding the increased civilisation of man, and in its operation I fear it will be found that instances will occur when the oppression is considerable. There is no* doubt that in this country—notwithstanding our boasted panegyrics of the mercantile marine, notwithstanding the readiness of orators at all times to descant upon the mercantile marine being the nursery of our Navy— there is not the slightest doubt that the mercantile marine has been treated as an inferior service—has not certainly, I may say without exaggeration, been treated in the spirit which becomes a commercial people. But I have no donbt myself that in this affair of salvage, if you contrast the conduct of the Royal Navy at present with what the conduct of the Royal Navy was many years ago, you will find that their conduct has been extremely improved, has been much more considerate, has been often distinguished by great generosity. But the fact remains, that at the present moment even there are instances of the effect of the system of salvage upon our mercantile marine—instances which I have before me now, but with which I will not trouble the House—if I were only speaking upon the question of salvage I would —which convince Her Majesty's Government that the present system of salvage ought not to be encouraged; and, therefore, we are prepared to recommend that it shall entirely cease. I need say very little on the subject of anchorage. That is a regulation that, like salvage, depends, I believe, entirely, upon the Admiralty; and the Admiralty are prepared to say that all vexations of that kind shall also be concluded; and, from henceforth, if our propositions are favourably received, no merchant's vessel will be disturbed in its anchorage by the superior claim of a ship belonging to the Royal Navy.

Sir, there is a subject of paramount importance connected with the shipping interest to which I must now refer; and that is the restrictions which at present exist upon manning the merchant navy. In the opinion of Her Majesty's Government they are restrictions which, in principle, are indefensible. They are very doubtful whether, even in practice, they are beneficial. They think that the time has arrived, or cannot be long postponed, when those restrictions must entirely cease. But we must consider them in deference— I do not say to the prejudices of the country—but in deference to the feelings of large classes, and in deference, in a certain degree, to the circumstances with which we have to deal. We cannot consider the question of manning the mercantile marine in an isolated manner; we must view it with reference to another subject of great importance—namely, the subject of manning the Royal Navy. We trust that we, in due time, shall have to submit to the House measures which will effect a very great change in the system on which the Royal Navy is manned. The House may be persuaded that the time cannot much longer be postponed when that question must be met. Nothing can be more unsatisfactory—I would almost say more irrational—than the system upon which the Royal Navy is manned—a system which dismisses the seasoned seamen, when he is most qualified to do his duty to his country. There is no reason whatever that we should apply to the Royal Navy other principles than those that we apply to the sister service. Indeed, there is every reason why we should render the Royal Navy the most efficient service in the world. The attention of Her Majesty's Government is anxiously directed to this question. We are awaiting now the report of a Committee sitting at the Admiralty upon this important subject. Irrespective of that report, there are many considerations which would make us feel it our duty to bring the question before Parliament. I trust that when the question is brought forward it will be brought forward in a manner satisfactory to the country and this House; and, if the plans which we shall feel it our duty to recommend to the consideration of Parliament be adopted, I think we shall then be justified in terminating these restrictions upon the manning of the mercantile marine which at present exist. But I trust that the shipping interest, feeling, as I hope they will, from the manner in which Her Majesty's Government have met their case, that they are not anxious to evade any question, but only to do that which they think will be of advantage to the country generally, will not press a point of such importance at this moment, when virtually, it is under the consideration of the Government.

I have now touched upon all the points of any importance which are comprised in the case of the shipping interest, except those which relate to stamps upon insurance, bills of lading, and charter-parties; but the House will see at once that these are points which affect the revenue and general taxation of the country, and therefore this is not the time on which I can refer to them. At present I will only make a summary of the measures which Her Majesty's Government are prepared to recommend with reference to the claims of the shipping interest—measures which they recommend with the earnest wish that all real grievances may be remedied, that we shall cease to hear of the claims of a particular interest as subject to burdens and vexatious from which the community are free; and that from henceforth, if the measures which I have indicated are carried out in their proper spirit, we shall know of the shipping interest only as a portion of that great flourishing community in which I, for one, hope that all particular interests may for the future be merged. We propose, then, to deal with the question of lights under three heads. We propose to reduce the taxation which is paid by the shipping interest under the claim of supporting the lighthouses of the country—namely, the interest of debt which has been incurred, the contributions to charities, and passing tolls to harbours which ships never enter. We propose to terminate these three great sources of unjust taxation; and we believe that we shall be able to effect this object by the annual sum of 100,000l. The shipping interest will then have to pay only for the lighthouses which benefit them—which guide their ships and save their lives; and I am sure they will no more complain of a tax levied upon them for such objects and upon such principles than any other class of the community will complain of the peculiar taxes to which they may be subject, but for which they gain in return peculiar advantages. We propose, in the second place, to submit to the consideration of a Committee of the House of Commons the whole question of pilotage, in order that we may arrive at a result which I am sure will be impartial and satisfactory as well as final. We propose that the three Admiralty grievances of which the shipping interest complain—anchorage, salvage, and enlistment —shall be entirely terminated, or at least subject to regulations which will deprive them of the injustice and injury which are so justly complained of. We propose that the subject of manning shall depend upon the adjudication of Parliament on a still more important subject—and I am sure the shipping interest will not complain of that arrangement; and with regard to the last point—the taxes levied upon them under the head of stamps—that is one which affects the general revenue of the country, and which we will consider when we consider that portion of the general revenue of the country.

Sir, I have now placed before the House the general views of Her Majesty's Government with respect to the mercantile marine of the country, and the claims which it has so long urged upon successive Governments. I propose that we shall now consider the claims of the sugar-producing Colonies; and I hope the House will approach the consideration of this subject with the same temper and impartiality with which they have treated the preceding one. We must forget that sugar has been the battlefield of parties. We must form an opinion upon the condition of those Colonies from the stern naked facts which may be placed before us, and not with any recollection of the past. We may deplore the legislation that is past; we may be of opinion, Gentlemen on both sides, that the conduct of this country to- wards the sugar-producing Colonies has been inconsistent and incoherent; that great unnecessary damage and devastation have been occasioned; that, as an interest, they have been treated in a wanton and indefensible manner; but what we have to decide to-night is, what in the present state of affairs we can justly do for them. An hon. Gentleman told us the other night that especially on subjects of economy he was not fond of sentiment—and upon no subject, I believe; but a budget, certainly, however various its topics, and however peculiar the circumstances in which it is brought forward, is not an occasion on which Gentlemen should be sentimental. I have now before me what I believe can hardly be called a memorial— but it is an official paper of the West India body; and I can assure them that it is impossible that there can be any individual in this House who would view their just complaints with more ready sympathy than myself. I have expressed on other occasions, here and elsewhere, my sincere belief that the conduct of Parliament to the West India body generally has been such as will afford no emblazoned page in the history of this country. I think their sufferings have been great, and in a great degree have been unnecessary; I think they have been unwisely and unjustly treated; and it is with that feeling that I receive their representations. Now, after a certain statement, with which I will not trouble the House, I have here embodied before me the claims of the sugar-producing colonies for relief from this country. They ask, firstly, that we should arrest the descent of the duties on foreign sugar; secondly, that we should reduce the duties on British plantation sugar; thirdly, that we should guarantee additional loans to be raised by the respective colonies for the purposes of immigration and improvement; fourthly, that we should permit the refinement of sugar in bonded refineries for home consumption as well as for exportation; fifthly, that we should permit the use of molasses in breweries; and sixthly, that we should equalise the duties on rum and British spirits. Now, in the first place, I have to consider whether I can recommend to the House to arrest the descent of the duties on foreign sugar, or reduce the duties on British plantation sugar. I have to consider that question in a Parliament which has been elected to establish and develop the principle of unrestricted com- petition. I should find, under any circumstances, great difficulty in making such a recommendation; and if I saw the market overwhelmed by foreign productions—if I saw, in consequence of the incoherent and wanton legislation of this country, contradicting their original agreements, and violating their original compact—if I saw ruin falling upon all the sugar-producing colonies of the Crown—I still should probably hesitate before, after the verdict of the country, I could recommend a recourse to differential duties to arrest the progress of such ruin, and to mitigate the suffering the consequence of such legislation. But when I examine the facts, I am not called upon to consider that. When I am asked to arrest the descent of the duties on foreign sugar, and to reduce the duties on British plantation sugar, I naturally inquire what is the state of the market with reference to the production of these two commodities; what is produced by the British plantations which require their duties to be reduced?—what is produced by the foreign plantations, the descent of the duties on which is to be arrested? Is there such evidence before the House and the country of an impossible rivalry between the British and the foreign sugar-producing colonies that would justify a Government under any circumstances in coming forward to Parliament and asking for factitious protection and support to the British sugar-producing colonies? Sir, this is not a subject of sentiment, as the hon. Gentleman said the other night; it can only be decided by a reference to facts. I shall place before the House the facts as they at present exist; and then I will leave the House—Gentlemen on both sides —to form their opinions. By the representation which I have just read, we are asked to believe that the competition between our colonial sugar and foreign sugar is a competition that cannot be endured. We can only infer from the remedies which are recommended that ruin will be the necessary consequence of such a change in the duties not being adopted. But I will ask the House for a moment to attend to the last return which I have here drawn up to the 5th of November, of the quantities of sugar, refined and unrefined, entered for home consumption in the United Kingdom in the first ten months of 1851 and 1852. In that period of 1851 there were entered for home consumption 2,251,000 cwt. of West India sugar; in 1852, 3,094,000 cwt. Mauritius, which sent us in the first ten months of 1851 804,000 cwt., sent us in the first ten months of 1852, 976,000 cwt. The East Indies, which sent us 1,037,000 cwt. to November, 1851, sent us 1,300,000 cwt. in the same period of 1852. Our united colonies, if I may so call them, sent us 4,094,000 cwt. in the first ten months of 1851, and 5,373,000 cwt. in the first ten months of 1852. It would appear, then, from this statement, that there is no necessity whatever for reducing the duty on British colonial sugar; and I now have to see whether we ought to arrest the descent of the duties on foreign sugar. I find that the quantity of foreign unrefined sugar entered for home consumption in November, 1851, amounted to 1,218,000 cwt.; but in November, 1852, instead of being 1,218,000 cwt., the quantity entered for home consumption amounted to only 570,000 cwt. I find, also, that the quantity of foreign refined sugar has been reduced, though not proportionately. In November, 1851, the quantity of foreign refined sugar entered for home consumption was 268,000 cwt.; while in November, 1852, it amounted to only 243,000 cwt. It may be said that these are merely figures; but I beg to observe that, in this instance, figures constitute the case. This is a question of figures, and the result of the figures I have quoted is, that there being, in 1851, 4,126,000 cwt. of British sugar against 1,487,000 cwt. of foreign; in 1852 there were 5,378,000 cwt. of British against only 814,000 cwt. of foreign. In other words, British production has increased by 1,250,000 cwt., and foreign production has decreased by about 600,000 cwt. I may be called traitor, I may be called renegade; but I want to know whether there is any Gentleman in this House, wherever he may sit, who would recommend a differential duty to prop up a prostrate industry which is actually commanding the metropolitan market, under the circumstances which I have placed before Parliament? It is unnecessary to enter into any argument on the point. No person could think of proposing an increase of differential duties except for the attainment of a definite object. If that object be to give the command of the home market to our colonies, it is already attained. As far as the quantity consumed —which must, after all, be the test of the quantity produced—is concerned, it is quite clear that no alteration of duties could do more than our own sugar-producing colo- nies effect. I will not say that our colonies Lave effected this result by their superior energy, because I am unwilling to raise any controversy on that subject; but the fact itself admits of no dispute, whatever difference of opinion may prevail as to the causes which have conduced to this state of things. Well, Sir, I am asked to guarantee additional loans to be raised by the respective colonies for the purpose of defraying the expense of immigration and improvement. Now, certainly a more legitimate object of exertion on the part of colonies than the promotion of the immigration of foreign labourers cannot be conceived; and it is one which ought to be encouraged in every suitable way. I am ready, however, to show to my Friends and the House that the Government have not been inattentive to this subject. Our attention, as well as that of the preceding Government, has been called to the subject of Chinese immigration into the British sugar-producing colonies; and we hold it to be one of the utmost importance. Having, unfortunately, a great deal to say upon other topics, I will not weary the House by going into many details on this subject, although they are all of the most interesting kind. Here, however, lies before me a memorandum of what—as far as the present Government is concerned —hasbeen done on the subject of immigration into the West Indian colonies. [Here the right hon. Gentleman read an extract, which stated that Sir John Paking-ton had appointed a Government agent to superintend measures for the encouragement of Chinese emigration; that this agent was now established at Hongkong; that by his exertions three shiploads of Chinese labourers had been despatched to Trinidad, and that the colony of British Guiana had, on its own account, made arrangements for importing 1,700 immigrants.] Thus it appears that the Government has already despatched three ships with immigrants, and that British Guiana has placed its private machinery in motion, and is about to import 1,700 more; in short, it is clear that Chinese immigration is going on. When, however, I am asked to come forward and sanction further loans to assist this immigration, I must place before the House some facts conected with the question. Let it not be supposed that I dwell too long on subjects which some may conceive to be not of vast importance. There are great questions to be settled tonight; and, unless we meet fairly the claims of parties who allege that they are aggrieved, we shall not be advancing in the great enterprise in which we have embarked. When, therefore, a body like the West India Society asks the Government of this country to sanction a further loan for the immigration of labour into these colonies, it becomes absolutely necessary to point out the relations in which the West India interest stands to former loans guaranteed by Parliament, and sanctioned by the Legislatures of the Colonies. Under 11 & 12 Vict, the Government is empowered to guarantee loans to the West India colonies, at 4 per cent interest, and not exceeding 500,000l. in amount, for the promotion of immigration, the construction of public works, and other objects of alike nature. What sums have been allotted out of the 500,000l. British Guiana has been allotted 250,000l., Trinidad 100,000l., and St. Lucia 3,000l.; altogether 353,000l. have been allotted out of 500,000l. There is at present under the consideration of the Treasury a recommendation that 100,000l. should be allotted to Jamaica. Supposing that done, there will still remain 47,000l. unapplied. But this is not all. Of the sum of 250,000l. allotted to British Guiana, only 150,000l. have been taken; and of the sum of 100,000l. allotted to Trinidad, only40,000l. have been taken. How, then, I ask the House, can a claim be justly urged on the Government to propose fresh loans for the encouragement of immigration to our sugar-producing colonies when the sum already provided for that object has not yet been exhausted? I am sure that the West India body will, on reflection, feel that circumstances, as at present existing, would not justify the Government in coming forward to propose a fresh loan for these colonies. I now come to the fourth request put forth in the memorial of the West India body, namely, that we will permit sugar to he refined in bond for home consumption as well as for exportation. I have given this subject my earnest consideration. It will be remembered how, in old days, this question was ably debated in this House by Lord George Bentinck, and how I and my Colleagues supported it. No doubt this would be a very great boon to our sugar-producing colonies; but there are other considerations which bear upon the question, and which in its decision must be taken into account. I will put the case before the House as briefly as I can, and I cannot do so more clearly than by asking the House to suppose that the year 1854 has arrived, when no differential duty will remain, but when all sugar—whether foreign or colonial—will be subject to an equal duty of 10s. It is represented to us that the saccharine matter of foreign sugar, unrefined, is considerably greater in amount than that of British colonial sugar. It appears that every hundredweight of foreign sugar contains about 90 per cent of saccharine matter, while a hundredweight of colonial contains only from 70 to 75 per cent; compared with the coarse sugar of the East Indies, the difference in favour of the foreign is still greater, being as 90 to 60, or somewhere thereabouts. The House will perceive that, under these circumstances, when the duties on both sugars are equal, the raw produce of which the manufacture terminates in bringing forward such a superior article, has, in point of fact and in practice, a differential duty in its favour. If 10s. were levied on the first, the produce of which is represented—say, by 90— and only 7s. on the second, the produce of which is represented by 60, it might express the differential duty in this instance, The colonists ask to refine their sugar in bond for home consumption—that is, that the Government should take the duty on the refined produce, and not upon the coarse or raw sugar. There are, certainly, considerations connected with the revenue of the country which require to be duly weighed in looking at this demand; but I do not think that considerations connected with the revenue constitute a sufficient ground for resisting the claim of an interest in the position' of the West India colonies. Here we have an opportunity of conceding to them a- great boon which is quite consistent with the principle of unrestricted competition. I announce, on the part of the Government, that we are prepared to concede this boon—we think it ought to be conceded, and we believe it will afford great relief and also give a fresh impulse to the manufacture of colonial sugar. Of course, the boon will be conceded subject to conditions neceesary for the protection of the revenue. I will not now say anything about the use of molasses in breweries, or the reduction of the duty on rum, for the same reason which induced me not to enter into discussion respecting stamps on charter-parties and marine insurances—points connected with the shipping interest. They are not questions of peculiar burdens, but enter into the consideration of the means by which the general revenue of the country shall be raised; and this is not the moment to make any observations on that point.

There is one other subject, however, on which I must touch before I can proceed with the general exposition of the financial scheme which I mean to propose to the House—and that refers to the local taxation of the country. It is quite unnecessary for me to enter into any of those arguments with which both sides of the House are so familiar, as to the character of the local taxation of the country, or any longer to show that there are objects of universal interest which are, in fact, sustained by taxation imposed, not upon the general property of the country, but upon parts of that property, and upon a peculiar division of it. The whole question has been met so ingenuously by one who, though opposed to the policy I sometimes recommended, is a master of the subject—I mean Mr. Corne-wall Lewis—that I am perfectly willing, as far as any reasoning on the subject is concerned, to rest it on the evidence given by that Gentleman before a Committee of the House of Lords on the subject of local taxation, and subsequently revised and printed by him in a pamphlet when in office, and, of course, with the sanction of the Government to which he belonged. Mr. Lewis says, that, so far as the principle is concerned, it cannot be contested that the support of the poor should be a subject of general taxation. There is no question, perhaps, of such general interest as the support of the poor. The support of the poor is a matter of general, nay, universal, obligation: and, so far as the principle is concerned, the complaint on this head of a portion of the real property of this country, which has, suffered most by recent legislation, is exceedingly well founded. There could hardly be a difference of opinion about that; therefore, it is unnecessary to enter into any discussion on the subject. Well, Sir, some years since a portion of the real property of this country—the agricultural interest—during a period of great suffering, became extremely sensible of the injustice of the existing system. To be called upon to pay local rates for a subject of universal obligation, which ought to be maintained by universal contribution, drew their attention naturally to the incidence of that taxation. They complained of the injustice to this House, and, Sir, I think that in the discussions and divisions which took place upon the question in this House, they made out a good case. I think, therefore, I may assume that we shall have no dispute upon principle, and we have now to consider what course we shall take with respect to taxation which is mainly levied for purposes of general obligation, hut is not levied on the whole community. The local taxation of the country is a subject with which the House is now so familiar that I shall be able to treat it more succinctly than I probably should have been able to do a short time back. This local taxation resolves itself into three principal rates, namely, the highway rate, the county rate, and that great rate called the poor-rate; each of which has been in its turn the subject of much discussion in this House. The highway rate has been discussed in this House chiefly with reference to its improved administration. The county rate, though not very considerable in amount, has excited a large share of public interest from the attempts which have been made to establish the representative principle in connexion with its management. The third is, however, the rate which has most occupied public attention, both as regards its object and its amount—I mean the poor-rate. I will not say anything on the subject of the highway rate. Six Bills have been brought into Parliament with the view of establishing a better administration of the highway rates; and it was my intention not even to have adverted to the subject were it not that my hon. Friend the Under Secretary of State—who presided with singular ability and unwearied industry over the Committee on Turnpike Trusts, and who on several occasions has, as the House has recognised, proved himself to be a master of the subject—has, though having quite enough to do in his own department, been kind enough to assist me in the preparation of a seventh Bill on the subject of highway rates. I hope that this Bill will, after six experiments, win the confidence of the House and the country, and have a beneficial effect, both administratively and financially, on the districts affected by the highway rate. I now come to the county rate, which although the smallest of the three, has, from the peculiar circumstances to which I have already adverted, excited a good deal of interest in this House. With respect to the administration of this rate, I would here say, that, generally speaking, on the first point— namely, the principle of representation— there is not, on the part of Her Majesty's Government, the slightest objection to the introduction of the representative principle into this, any more than into any other of the public affairs of the country, provided it can be done without disadvantage to the public good. Therefore, with reference to the administration of this rate, we have no objection whatever to the adoption of the representative principle, if it should be the opinion of the House that the ratepayer is entitled to control over the expenditure of the rate. But this fund is a small one, and there are two items in the rate to which that popular principle cannot be well applied—namely, those portions of the rate which are directed to the maintenance of gaols and lunatic asylums. This forms the great— indeed the only—difficulty in the application of that principle to this rate. The gaols and lunatic asylums have hitherto been under the superintendence of the magistrates; and it is admitted that those gentlemen have, on the whole, discharged their duties in a satisfactory manner, though, speaking a priori, it might be objected that the control of establishments of this kind ought not to be vested even in them. It cannot, I think, be doubted that the prisons of this country, as a portion of its executive administration, ought to be very much, if not entirely, under the control of the Executive Government. I think the time is approaching—and it may be rapidly—when we shall have to consider the whole question of punishments as one of the most pressing questions of the day; and an occasion will perhaps arise when the Government may feel that they ought to act with more directness and decision with respect to the management of gaols than the House would now be prepared to sanction. However, at present, taking a more limited view of this branch of local taxation, let us see what burden it imposes on that portion of the property of the country which has suffered most by recent legislation; and if we be of opinion that that burden is unjust, let us consider what remedy we can apply to the case. In the first place, let me remind the House that the incidence of the county rate on the property of the country is extremely slight. The rate amounts to 800,000l., taking into account the deduction of contributions from the Consolidated Fund and other sources, to the extent of 300,000l. Taking this deduction into account the rate amounts to 3d. in the pound on the property assessed. Admitting, for the sake of argument, the incidence of the county rate to be unjust, what can we do that will produce any sensible effect? If we should throw half of the amount of the rate on the Consolidated Fund, it would relieve the ratepayer to the extent of three-halfpence in the pound; but, at the same time, it would require such an amount as would sensibly embarrass us in dealing with the general taxation of the country. There are many taxes that do not produce more than 400,000l. a-year, and yet are found to act most injuriously on the great body of the community, and injurious, of course, as a consequence, to the agricultural community. I say then, frankly, so far as the county rate is concerned, that I am not prepared to recommend any change in that portion of our local taxation. [Sensation.] I must remind hon. Gentlemen that they were so kind as to intimate that they would not decide upon my proposal until it was altogether before them, and that they would let me state my case. Now, Sir, I come to the consideration of the poor-rates. In dealing with these rates I beg to say I have not in any way changed my opinion from what I formerly entertained and expressed, that the absolute incidence of all local taxation is perfectly indefensible in point of principle; but looking to that which is most expedient for the country generally, and most expedient for that class which I think most injuriously affected by the present arrangement—taking that view of the case, I will now for a moment examine the question of the poor-rates. We must, Sir, remember, in the first place, that a very great change has taken place in the burden of the poor-rate since, at the commencement of 1849, I first brought under the consideration of the House the incidence of our local taxation, and especially and mainly of the poor-rate, upon realised property, and particularly upon that portion of realised property which was then greatly suffering. Between the last official return describing the amount levied for the maintenance of the poor, on the table when I addressed the House on that subject in 1849, and the last official return which is now on the table of the House, there is a difference of nearly 25 per cent. When I look into the expediency of the course I am to take, that is a most important consideration. There is no proposition I ever brought forward with respect to the establishment charges which, if it had been carried, would have effected so great a relief as this gradual diminution of the poor-rates. Now take, for example, those establishment charges. The establishment charges for the salaries of officers connected with the administration of the poor are something like 430,000l. a year. Well, since 1848–49, until the last return upon the table, you have had, on an average, an annual diminution of the rates equal to the amount of the establishment charges. The return of the expenditure for the relief and maintenance of the poor which was on the table when I addressed the House in 1849, was not the return for 1849, but for 1848; and it was, of course, the basis of my general argument, and the origin of the feeling in the country on this subject. The amount was 6,180,000l. Now, the amount expended for the relief and maintenance of the poor in the year 1851'—according to the last return on the table of the House, though I have a more recent one, which I shall refer to subsequently— instead of being 6,180,000l., was 4,962,000l. [Loud cheers from the Opposition.] I am afraid that is really not a cheer on account of the diminution of pauperism. I am afraid it is a cheer for recent legislation. Now, I don't want to disturb "recent legislation," but your cheer is a very illogical one, and I must show you—what I should not otherwise have done, because I don't want to raise any controversy on the subject—that recent legislation may not have had anything to do with this result. Now, you (the Opposition) think "recent legislation" is the cause of the poor-rates, in 1851, having been under 5,000,000l., and upon that you cheered, but then it so happens that in 1846, before "recent legislation" took place, the rates were rather less. [Mr. BRIGHT: With the same price of corn?] I think, though I don't want to do it, I could produce some returns of the prices of corn which would show that diminished poor-rates may coexist with high prices of corn—one return, for instance, which, when I quoted it, the late Sir Robert Peel said ought never to have been printed; but there are greater subjects for us to consider than the triumph of obsolete opinions. [Great laughter from the Opposition.] Yes, I look upon one-sided free trade as an obsolete opinion, just as you look upon protection—obsolete, because they are lost in. the great principle of the day— that of unrestricted competition. Now, I must put these facts before the House, because they are very significant, and till then I hope hon. Gentlemen will suspend their accents of triumph. I have shown you that there has been a diminution of poor-rates from 1848 to 1851 of nearly 25 per cent—a very important point for me to consider as regards the expediency of dealing with those rates; but, though there has been, from 1848 to 1851, a diminution of nearly 400,000l. a year in the poor-rates, I have here the return for 1852; and I am sorry to say that that rate of diminution has not only ceased, but that very little diminution has taken place. The returns of the Poor Law Board, which I have in my hand, are very contradictory to the popular opinions that are held; and it is of the utmost importance that we should have correct ideas upon this subject, not only with reference to the condition of the people, but also with reference to that important question which is agitating the public mind—namely, as to the influence of emigration upon the consuming power of the country. One would suppose, from what we are told, and from what we read every day, that an ablebodied pauper was not in existence, and that a time has arrived in which the common business of the country cannot be carried on, owing to the emigration which is taking place. Now, the fact is, that in that wonderful period of 1851-2, in which we heard all these stories, and when I, for one, was prepared to see certainly an equal diminution of pauperism in the country, there has been no such result. The amount of the rates for 1851 was 4,962,000l, and for 1852, 4,894,000l.; and I find, from the return for the half-year ending in Michaelmas, 1852, that the amount is 2,432,000l., which, being doubled, would give 4,864,000l. for the year; but you must remember that the half-year ending at Michaelmas is the mild half-year, and, therefore, I do not think we can believe that any sensible reduction of the pauperism of the country ought to be relied on. I will not, however, urge any argument upon it. I confess myself, notwithstanding this return, I believe that the country is in a most prosperous state, and I will not relinquish the belief that pauperism will yet be sensibly diminished; but it is my duty to place these details before the Bouse. Still, the great fact remains that the charge for pauperism in this country upon realised property, and especially upon, the agricultural interest, has been reduced by the amount of 25 per cent since I first drew the attention of the House to the subject; and there is no doubt, notwithstanding the somewhat disappointing return I have just placed before the House, that there are circumstances in operation at this moment which, if human judgment can lead us to a reasonable conclusion, must considerably affect the amount of pauperism in this country. I have no doubt the counteracting causes that, for a moment, have arrested the rapid diminution of the rates might be discovered, but I myself still believe there are circumstances and causes in operation that will progressively, and even materially, diminish the pauperism of the country. Well, then, Sir, I have to consider, under these circumstances, whether it will be expedient to deal with the sum that is raised by local taxation for the maintenance and relief of the poor. I have to recollect that, since I brought this subject forward, there has been such a diminution in the amount levied that four times the amount of the establishment charges have been saved to the realised property of the country, I have to recollect that we are precluded from dealing with the establishment charges entirely, since that could not be effected without the transference of the entire patronage of many thousand offices to the central Government—an arrangement which in this country could not be tolerated. I have to recollect, also, with regard to that peculiar portion of the realised property of the country whose claim I urged, that since the period of 1849 the relative proportion between that property and the other realised property of the country has undergone a change, and that from both these causes the incidence of this taxation is less severe. Lastly, I do believe that all the influences in operation, notwithstanding the return I have quoted to the House, tend to the diminution, and the considerable diminution, of the burden in question. Well, Sir, as my means are limited —looking, as I have anxiously looked, for means by which I might assist every suffering class, every class which I think has a fair claim to the consideration of the House, in a manner which would contribute to the general welfare of the community—helieving that the measures which, on the part of my Colleagues, I am about to propose to-night have that tendency, and that they will greatly assist those who, I think, have been subjected to a very severe trial, and who, in this respect, I conceive, are liable to a taxation which, on principle, cannot be defended—I am not prepared to recommend any change in the present system of raising the local taxation of the country.

I have now, Sir, considered three instances of peculiar interests that have, in my opinion, suffered by recent legislation. I have placed before the House the general views of Her Majesty's Government with respect to those interests. I have offered, with regard to the shipping interest, measures which, so far as I could judge of the feelings of the House, were, I think, considered moderate but satisfactory. ["Hear, hear!"] I mean moderate so far in their conception that they have not been framed with an ad captan-dum purpose; satisfactory, because I believe this House and the country will take them as a final settlement to that controversy. I have endeavoured, on the part of the Government, to view the claims of the sugar colonies in a just and fair spirit. I am sure that those who are connected with that interest must be satisfied that it would be quite impossible to propose a differential duty; that that claim could only have been urged by those who were not masters of the facts; and they must see, from the course taken on the part of the Government as to encouraging immigration to the Colonies, and permitting them to carry on the manufacturing processes without the restrictions which before existed—a boon whioh has been described to me by an eminent member of the West India body as equal itself to a differential duty of 1s. 6d. per cwt.—they must feel, when the Government have taken upon themselves the responsibility—for it is a grave responsibility—of recommending that step, besides others to which I shall have to advert, having the same object in view, that there has been an anxious desire on our part to place them in as good a position as present circumstances and the temper of the public mind would permit. I believe, Sir, that the measures we have recommended with respect to the West India body will sensibly improve the condition of that interest. I shall not touch any further upon the subject of local taxation. I now approach the more important topic of viewing the taxation of this country under the new circumstances in which all parties and conditions of men have now agreed they are to be placed. So long as there were two great parties in this country who questioned the principle upon which our commercial code ought to be established, it was impossible to obtain any general adhesion to the principle upon which our financial policy ought to be constructed. So long as a man thought that his industry ought to be protected, he was prepared to endure a heavy burden of taxation artificially distributed. So long as a man thought that his industry should be free from all restriction, of course he demurred against the system which imposed restriction upon the financial arrangements of the country, and raised the prices of the articles which he consumed. It is obvious, generally speaking, that the doctrine of unrestricted competition is not consistent with restricted industry—in a word, if you decree that the community are to receive low prices for their produce, your policy ought to be one which will put an end, as soon as possible, to high taxes. Well, Sir, after the general election, and after the solemn verdict of the country, we had to consider the general system of our taxation, and to apply to it the principle of unrestricted competition. We had to ask ourselves what were the measures which it was best to recommend to Parliament— now that this principle was formally and definitively established, what were the measures most consistent with that principle, and which would enable the community to encounter that competition which it must now, in every form and in every sense, be prepared to meet? Well, Sir, when we took that subject into consideration, giving it the utmost thought we could command, it appeared to us that we must arrive inevitably at this result—that we should best enable the people to engage in that competition to which they are now for ever destined by cheapening as much as possible that which sustains their lives. We look, therefore, to articles that are of prime necessity, and if we find that those articles of prime necessity are subjected to some of the heaviest taxes in our tariff, then we say that these are arrangements inconsistent with the now system established, and the new principle of which we have approved. It is the boast of hon. Gentlemen opposite that they have given cheap bread to the community—but the principles upon which you have given cheap bread to the community are principles which ought to make you cheapen the sustenance of the community in every form; and I think I shall he able to show-to the House, that if they adopt that principle of finance, they will, in a legitimate manner, without going out of their way, and without any artificial means, he giving the greatest possible impulse to every branch of the industry of the country, and especially to those very branches that have most suffered by recent legislation. The House, therefore, will not be astonished that Her Majesty's Government are prepared to recommend Parliament to deal with the malt tax. Here is a prime necessity of life subject to a very high tax, and a very high tax levied under circumstances which greatly restrict industry. I am not called upon to recommend the change I am about to propose to the House to hon. Gentlemen opposite on any other plea than that which they have al- ways declared to be the sovereign plea— namely, the benefit of the consumer. Hon. Gentlemen opposite have sometimes told friends of mine, when they have proposed dealing with the malt tax as a means of assisting the agricultural interest, that it was only a consumer's tax; but I am sure hon. Gentlemen opposite will not oppose the plan of the Government on that plea —that they will not get up and tell me I am about to propose a change in the law which will only benefit the consumer. It can hardly be the effect of the dissolution of Parliament, it will hardly be the effect of the triumph of unrestricted competition, that I am to be told by hon. Gentlemen opposite, on the first occasion when I propose a remission of a tax, that it can only benefit the consumer. On the contrary, I give hon. Gentlemen opposite credit for the consistent and sincere conviction that the interest of the consumer is the interest which we ought first to consider. I have never disguised my own opinions on this subject. I have always told my friends that though it was certainly the interest of the consumer that the malt tax should be dealt with, still it was my opinion that there was no tax with which we Could deal which, if properly dealt with, would more benefit the agricultural interest. [Cheers.] I hope hon. Gentlemen opposite will not grudge me a few observations on this view of the question to those with whom I have so long been in close connexion. It appears to me that the question of the malt tax has assumed a totally different aspect since the repeal of the corn laws. I know it was said by one who was justly of great authority in this House—one of very great authority with me—that the moment' you repealed the corn laws the repeal of the malt tax was inevitable; and, Sir,. I think there will be no great difficulty in demonstrating the soundness of that opinion. But it is quite clear, when Ministers of State take every opportunity of informing the cultivator of the soil that he must grow-as little wheat as possible, that the difficulty of maintaining the policy of a law which restricts the production of the next generous grain is proportionately increased. There is no doubt, when the tendency of your recent legislation is to diminish the production of wheat, and, in fact, to limit its production to those soils only which are eminently and naturally qualified for it, that the tendency of your legislation should be, if not to encourage those productions which would be natural to the soil, now that wheat is to be relinquished, at least not to maintain laws which would discourage the production of them. Even as regards-wheat, it is impossible that any legislative means can be devised which would merer tend to the encouragement and support of the wheat land than, in fact, diverting those soils that were improperly employed in the cultivation of wheat back to their original purpose. The more you produce barley upon the soils qualified to produce barley, the more you are improving the market for the production of those soils eminently qualified to give us wheat; and the indirect influence of any change in the malt tax upon the production of wheat will be, in my opinion, very considerable. Well, Sir, we now have to consider, in the first place, how we shall deal with this tax", in what manner and to what degree. If we deal with it in a small manner, w6 shall probably accomplish none of those objects to which I have alluded. The consumer; will not be benefited—the cultivator of the soil will not be benefited—you'll neither have cheap beer,' nor will you have a freeer cultivation of the land of the country. What you want is, that you shall have as much as possible unrestricted industry, and its consequences, as far as the cultivator of the soil is concerned; and that one of the consequences of that unrestricred industry should be that the consumer shoul be be enabled to procure one of the main causes of his expenditure, and one of the principal sources of his health and strength, supplied to him at a reduced price. Those are the objects we wish to attain, and they appear to us to be objects which cannot be attained If we deal in a small manner with this great subject. The existing duty upon malt is 2s. 7½d., and 5 per cent on the bushel. The consumption is increasing. In 1849 it was 38,935,000 bushels; in 1850 it was 40,744,000; and in 1851 it went a little back, and was 40,377,000 bushels. But, though increasing, there is no article of consumption which has less proportionately increased, and the diminution of the consumption of which can, I think, be more clearly attributed to the large tax levied on it, and to the restrictions which that tax occasions. I know there are Gentlemen who have endeavoured to maintain at times that the reason the consumption of malt has not increased to a greater extent is, that the taste of the country has been diverted to other sources of sustenance and excitement; but I think I could show to the House, by a reference to a few general statistics upon these subjects, that that is a position which cannot be maintained. Well, Sir, under these circumstances Her Majesty's Government think it their duty to recommend to the House that the malt tax should be considerably diminished— that we should diminish by one-half the amount of the present duty on malt. The sum which we have to deal with is a sum which exceeds 5,000,000l. as regards the revenue, and we propose that we shall diminish the duty exactly by one-half; we propose that there should be paid an uniform duty of 1s. 3½d, and 5 per cent per bushel upon barley, and also upon every bushel of bere and bigg; we propose to terminate the restrictions and the difference in the duty which has been injuriously and improperly maintained between malt raised from barley and from bere and bigg; and we propose also to do away with the drawback in Scotland upon spirits produced from malt. That drawback has already been renounced by Ireland as unnecessary. It was recommended by the Commissioners on Excise Inquiry as one which should be terminated whenever any considerable reduction took place in the duty upon malt; and I think I shall have no difficulty in showing to the House, when we come to points of detail, that this is a change which ought no longer to be postponed. Now, allow me to read to the House the recommendation which was made, in the year 1831, I think, upon the subject of the malt duty, by a distinguished Member of this House, Sir Henry Farnell, who was at the head of the Royal Commission to inquire into the Excise, and to whose labours we are indebted for some of the most valuable documents in our Parliamentary library. Now, these words are very interesting when we remember the circumstances under which they were written. Having entered into a general statement that the most effectual mode of suppressing illicit malting would be by a reduction of the duty on malt, he went on as follows:— But, if the importation of foreign barley be not permitted, the tendency of a reduced duty to increase the consumption of malt would be counteracted by the price of British barley becoming higher in consequence of the new demand for it, which would arise from the duty having been lowered; and thus the consequence of a reduction of duty would be, not such an increased consumption of malt as would keep the revenue up to its present amount, but a higher price of barley, and a certain loss of revenue. As, therefore, there is no probability of a reduced duty being followed by such an increased consumption of malt as would prevent a loss of revenue, so long as the importation of foreign barley is restricted, we are of opinion that it will be preferable to endeavour to check illicit malting by the enforcement of the Excise laws, however inadequate they may be to produce a complete remedy, rather than to try the experiment of stopping it by a reduction of duty. If there were no factitious cause for elevating the price of barley, arising from the direct effect of a duty on foreign barley, or from the indirect effect of duties on other kinds of foreign corn, we should not feel any hesitation in saying that the proper way of dealing with the malt duty would be to reduce it one half. Those were the words of Sir Henry Parnell. Practically, he said that, if your corn laws were repealed, he recommended you to reduce your malt duty one half; that, too, is the opinion of a Gentleman as tender of the revenue as any Gentleman who ever spoke in this House. Those circumstances, which Sir Henry Parnell possibly did not contemplate, have occurred; you have repealed your corn laws, and I ask you now to sanction the recommendation made by Sir Henry Parnell at that time. "For," says he— Nothing, in our opinion, can be more unwise than to reduce duties on articles which are fit subjects of taxation, without at the same time taking care to secure the most abundant supply that is possible to be secured of the materials which are necessary for their production. Well, you have done that. The circumstances which he anticipated have occurred, and now I ask you to adopt the measure which he recommended.

MR. CAYLEY

Is that the report of the Commissioners that you have quoted from?

The CHANCELLOR OF THE EXCHEQUER

Yes; the report of the Com- missioners of Excise Inquiry, of which Sir H. Parnell was the chairman. The report of the Commissioners also recommended terminating the drawback on spirits made from malt in Scotland. That is at present 8d. per gallon; and, of course, if there were a reduction of the duty by one-half, it would only be id. per gallon. But here is the report of the Committee on the Spirit Duties in Ireland:— That it is the opinion of this Committee that the repeal of the malt drawback in Ireland will not be prejudicial either to the trade in spirits, or to the revenue, in that country. That was in 1842. In consequence of that, the drawback in Ireland was terminated without a murmur. It has given general satisfaction, and I am certain that the repeal of the drawback in Scotland will prove equally successful. There are many points in the report of the Commissioners of Excise Inquiry as regards malt which are well worthy of the consideration of the House. They particularly dilate on the length of credit which is given in that trade. They show the vicious principle on which that system has been established; and they recommend that the credit should be limited to the same duration which applies to all other exciseable articles. I confess I am not prepared to give unqualified adhesion to that recommendation. I think it is of the greatest importance that in all these changes the particular trades involved should be disturbed as little as possible; and, though I think that the principles laid down in that report are sound principles, and that ultimately we should look as much as possible in this country to diminish the system of long credits, which is not adapted to the principle on which our commerce is conducted at present, but which was the result, I think, of paper currency and war speculation—still, at the same time, I think it would not be wise unqualifiedly and entirely to adopt the recommendation of the Commissioners in this respect, We propose, then, that on the 10th of October next the malt duty shall be reduced one-half. We have fixed on that period, of course, after due examination into the question when the change could take place with the least inconvenience to the trade, and, as we believe, with the most general benefit to the community, and the 10th of October is the day on which we have fixed. On that day we propose to take the stock on hand throughout the country, and of course we shall guard those who are then possessors of malt from the competition so far as the one-half in the amount of the duty is concerned to which they will be subjected, and for that stock in hand they will receive a drawback in proportion to the reduction of the duty. I do not know that this is the convenient moment at which I should attempt to place before the House the effect of these changes upon the revenue. It will probably be more convenient that at a subsequent part of my statement I should place the effect of those changes before the House. I will, then, once more, merely recapitulate, for the sake of clearness, what this change is: We propose to reduce the duty on malt one-half; we propose that there shall be no difference between the duty on malt raised from barley and from bere and bigg. This will occasion some accession to the revenue, though it is not for that object, but in order to simplify the subject as much as possible, that I recommend it to the House. We propose to put an end to the drawback allowed in Scotland on spirits raised from malt; and we propose that the reduction shall take place on the 10th of October next, on which day the whole stock in hand throughout the country will be taken, and a drawback allowed to the holders of that stock proportionate in amount to the reduction of the duty.

Well, Sir, following the principle which I have laid down, that in the present state of affairs we should consider our taxation mainly as it regards the great body of the consumers, believing that that policy will afford the most legitimate, the surest, and the most efficient means of relieving the industry of the country, I proceed now to another branch of the question. I have shown you that by the manner in which we propose to deal with the malt tax we benefit largely, as we believe, the consumer; but in doing so we think that incidentally—and that was only a secondary purpose—we are giving most efficient aid to the agricultural interest, far beyond what dealing with local taxation would give. Now, Sir, I come to another branch of the subject. I come to deal with an article as popular with the people as malt, as much a necessary of life, and subjected to a much heavier tax. I am about to recommend to the House to deal with the tea duties. Sir, I know the prejudices that exist among a certain class of persons on the subject of the tea duties; bat having had occasion to look very much into this question, I have been amused in mark- ing, the rise of opinion—the gradual formation of opinion—on this article of produce, now almost one of paramount interest in this country. I hardly know anything more diverting than to open Pepys's Diary, where we see it stated, "Took a cup of the new China drink —very pleasant," and to remember that net two centuries have passed, and the exotic novelty which pleased one evening that fantastic gentleman is now the principal solace of every cottage in the kingdom. Well, Sir, the great objection which has been urged at different times and by persons in authority—for I think it right to state a case of this kind as fairly as possible—is, that in dealing with tea, we deal with an article of limited production. True it is that since Mr. Pepys had his cop of the "new China drink"—true it is that since certainly the commencement of the last century, when only 500,0001b. of tea were imported into this country at a very high price, we have ended in importing more than 70,000,000 lb. in one year, and every year at a cheaper rate. These would seem to be facts in the face of which it is very difficult to believe that the production of tea can be limited. A production so immensely increased, and always imported at a lower price, appears to be one, the supply of which cannot certainly be likely to fail. But in the year 1834, I think, or shortly after the passing of the Reform Bill, when the trade with China was opened—when the charter of the East India Company was about to be, or had become, matter of discussion—it was always urged by per-sons of authority, against opening the trade with China, that we should be greatly disappointed in what would occur, because, the supply of tea being limited, it was quite impossible that there could be any reduction in the price. The supply of tea was then, I think, about 30,000,000 lb. per annum. Now, we have, last year, imported the unprecedented amount of 71,466,0001b., our consumption being, in round numbers, 54,000,000 lb. It is quite clear, therefore, that the importation of tea is still greater than our consumption; and it is also quite clear that the duties which exist, which are nearly 240 per cent per lb., check a consumption equal to the importation. Well, Sir, when we look to the gradual increase in the importation of tea; when we look to the broad fact that 30,000,000 lb. under the restricted trade have increased to 71,466,0001b. un- der the freer trade, though subjected to a colossal duty; when we look to all the evidence before us, and to the gradual diroi nution always of price, we have a right, I think, primâ facie to conclude that there will be no difficulty in supplying the demand for tea in this country. But, Sir, Her Majesty's Government, in dealing with this important subject, have not deemed it consistent with their duty merely to depend upon their own conclusions, formed from books, and their observation of what occurs around them. They have had an opportunity of consulting those who are great authorities on the subject, who, by their foreign residence, their particular study of the matter in question, and their natural aptitude to form conclusions upon such subjects, should be entitled to guide the judgment of any Administration. They have applied to those who, locally, were the best capable of forming an opinion— though, of course, to form an opinion on a subject in a country like China is much more difficult than in other countries— nevertheless, we have now some knowledge of China; nevertheless, there are individuals who are very competent to guide even a Government on such subjects; and, after bestowing upon this question the most laborious investigation, and having omitted no efforts to obtain the most accurate information; having suggested every means and every test by which that information could be brought to bear—having even personally had the honour and satisfaction of conferring with some peculiarly qualified to offer an opinion on the subject—Her Majesty's Government have arrived at the conclusion which, to use the most moderate language I can command, may be thus expressed— that there can be no prospect of any want of a supply of tea to this country. It is under these circumstances, Sir, that we approach this question. We must remember some facts of importance; we must remember that since the year 1841 the annual increase in the consumption of tea in this country has been 1,727,000 lb. There has been a gradual increase from 1841 of the consumption of tea, even at a duty of 240 per cent, and that increase during the last few years has been much larger. The increase in the consumption during the last six years, without any reduction of duty, has been nearly 10,000,000lb. In 1851 the consumption in round numbers was 54,000,0001b., while in 1844 it was 44,000,000lb. In considering this subject, it was impossible to shut our eyes to what has occurred in respect to the eon-sumption sugar. The consumption of sugar in the year 1844, the year immediately. preceding the great reduction of the duty was 4,129,000 cwt.; in 1850, it was 6,200, 000cwt.; and in 1851, it was nearly 6, 600,000 cwt., showing an increase in the first six years of the reduced duty of about one-half, and in seven years, of considerably more than one-half, the duty having' been reduced in the proportion of 25 to 10. In dealing with tea, we are of opinion that it would be perfectly vain to attempt to make any difference either between black and green, or between any Qualities whatever. We are persuaded, that in making any such attempt, we should only involve ourselves in great trouble that we should not attain the object we all desire; and that in this question, as in malt, or in any question of a similar kind, the boldest is the wisest Course. I mentioned before, that we were not of opinion that the reduction of duties on articles so far of a similar character, that they both tend to the sustenance of the people in the form of beverages, at all interfere with each other. I do not know any more striking case than the case of coffee. I think that in 1808 there was little more imported into this country than 1600,000 lb. of coffee. The duty was then considerable. It was changed—it was much much lowered; and, in 1809—and re-ineriiber what our population then was as compared with what it is at present—the Importation was nearly 10,000,0001b. But Simultaneously with that increased con-sumption of coffee the consumption of tea Mr increased, and we are now consuming 37,000,000lb. of coffee, while, as I have just: shown, last year we consumed 54,000,000lb. of tea, and probably we shall not consume much less than 57,000,000lb. in the financial year ending the 5th of January, 1853. Under these' circumstances, availing ourselves of the experience which dealing with the sugar duties has given, following a precedent which I think has been so successful, we think the proposition that we pught to make to the House—a proposition which I believe in every way is a safe proposition —should also be one in its character of a complete and Comprehensive nature. The present duty upon tea, with the 5 per cent added, is 2s. 2¼d. a. pound. Without making any distinction in the qualities of tea, we propose that we should reduce that duty to 1s, a pound; and we propose that, following the example of the sugar duties that reduction shall extend over the term of six years—that in the first year there should be a reduction of 4¼d. per lb. [Laughter.] I think hon. Gentlemen when they have reflected for a moment, will find they are too precipitate in their laughter, because we have to consider two things, we have not only to consider the revenue, but also the case as it affects the consumers, who seem to be quite forgotten by hon. Gentlemen opposite. There is not the slightest doubt that if the state of the revenue allowed us at once to reduce the duty to Is. a pound, you would probably find the greater proportion of the reduction would not go to the advantage of the consumer; because, although I have great confidence in the resources of China for the production of tea, although I know that China is the most populous country in the world, without stating how many hundred millions may be there, and although I know that tea is used in every part of China, and that the quantity exported is comparatively a very small part of that which is produced and consumed in China, and although I know very well there is an annual surplus left of that exporting quantity in China, still I am perfectly aware that if there is a sudden demand in this market, and you have not taken the usual and prudential care and consideration upon which all trade must be conducted, you will not find the con? sumer will benefit to the extent of the remission in question, while at the same time the revenue must suffer considerably. It takes three or four years to make a tea tree, and that is a point to be considered in dealing with these duties. If you want to increase production, especially of such, an article as tea, you cannot suddenly, go, with a demand for which they are not prepared; but if you take the scale which Her Majesty's Government propose—a very mo-derate scale I admit, but I believe a very safe one—I think, with very slight injury to the revenue, you will ultimately obtain that cheap and superior article which you would desire. Well, then, what we propose in dealing immediately with this ar-tide—and it must be remembered that tea is not like an article of domestic pro-duce, but is subject to very different con-ditions—what we propose is, that there should be an immediate reduction of 4½, per pound in the duty on tea, reducing it from 2s. 2¼d. per pound to 1s. l0d. I believe I have taken the increased consumption under that reduced duty at a Very safe figure Instead of 54,000,000, upon which the last January revenue was rasied I only put 60,000,000 lb. for the first year of the reduced duty, being an increase of 6;000,000 lb., but virtually not much more than 3,000,000 lb.; because, as I have told the House, the consumption of tea has so much increased on the quantity on which the revenue was last taken in January 1852, that probably the amount of the consumption of tea for this year will be 57,000,000 lb. Therefore, virtually, I only calculate upon an increase of 3,000,000 lb. at the reduced duty for the first year. I think, when we take the average of a great many years, and find that we have from year to year attained a similar increase, that we may well calculate upon an increase of 2,000,000 lb. a year. That is not an excessive calculation. I think the reduction we propose is one that we can make with perfect safety to our finances, as I will show to the House when I sum up the changes in the taxation of the country which Her Majesty's Government have determined to recommend. I propose, then, in regard to tea, that we should immediately reduce the duty 4¼d. a lb., and that in each subsequent year it should be reduced 2d. per lb. until it arrives at 1s. I believe that if you adopt that System you will very little injure the revenue, that you will gradually enable the people of this country to have a supply, at a very reasonable rate, of a very favourite beverage; and that you will do more than that'—that you will give a great stimulus to the commerce, the shipping, and the manufactures of this country. For my own part, I do not know any measure more calculated to give a great stimulus to the commerce and shipping of this country than a measure dealing largely and extensively with the tea duties; and, although I might have been glad to offer to the House a project with regard to this duty which, at the first blush, might seem of a more favourable character, yet, considering the circumstances under which Her Majesty's Government make their exposition of the financial policy they recommend—that the financial year is not yet concluded, and other circumstances—I am persuaded we hare taken a prudent as well as a bold course; and that, if the House accepts our proposition, they will have consented to one of the most important arrangements, and sanctioned one of the most effectual measures, ever brought forward to stimulate the commerce of this country.

Sir, there is one duty I am about to deal with, and which is connected with this branch of the subject, and which, perhaps, I ought to have adverted to before, and that is the hop duty. We are unwilling to make this effort to give cheap beer to the people without dealing with one of the important ingredients of that beverage. The House is aware there are two duties now levied upon hops. There is the old duty of the time of Queen Anne, and there is the war duty imposed during our great European struggle. Those duties are almost equal in amount; in round numbers, without the fractions, they amount nearly to about 1d. per lb. each, and what we propose is, that the old war duty—a very unpopular duty—a duty which ought never to have been continued-—should be remitted. At present we do not propose to take off all. Something must be left for future statements. Still I think in reducing the hop duty one-half, and the malt duty one-half, and reducing the tea duties immediately considerably in the pound, and in establishing machinery which will bring them down to Is. a lb., it cannot be said we have been unmindful of the claims of the community, subjected to the principle of unrestricted competition.

Now, Sir, there is one point of some importance which I think I ought to touch upon. We are raising the revenue of this country, and recommending all these measures on the principle that the revenue of this country shall mainly depend on the consuming power of the people. But it this been said of late, it has been rumoured about with considerable vehemence, that the consuming power of the people is rapidly diminishing. Some modern economists—I speak of those statements which meet us in many quarters and in many places—say that the consuming power of the people is in a state of rapid diminution; and I think I am only doing my duty in calling the attention of the House to that subject, for it is one that very much agitates the public mind; and it is the duty of the House to instruct the public mind upon subjects of so much importance; for, if that is true, certainly the principle upon which I am now recommending these measures is erroneous and mistaken. Now, Sir, I have no hesitation in saying that no evidence reaches me which in any way leads me to believe there is the slightest foundation for the opinion which is said to prevail—that the consuming power of the people is diminishing. I apprehend the idea which has given rise to the opinion that the consuming power of the people is diminishing, is., founded 'upon the emigration that has taken place from this country; and that is a subject to which the hon. and learned Member for Wolverhampton called the attention of the House the other night. There is no doubt that, if we look to the returns of emigration, we shall find that there has been a greater amount of emigration from this country within this year than is counterbalanced by the births, that have been registered in England and Wales. In the year 1849 the emigration was, in round numbers, 300,000; in 1850, 280,000; in 1851, 335,000; and on the 1st of October, 1852, the last return I have, that is to say, in three quarters of a year, they are in amount nearly equal to the whole of the year 1851—namely, 332,000. There is no doubt also that the births of this country, in the year 1851, were in round numbers little more than 600,000, and the - deaths amounted to 400,000. So it would seem from these returns that our births exceeded our deaths by 200,000 in the year 1851; and that our emigration exceeded the superfluity of our births by considerably above 100,000; but if these facts arc a little examined—if they are a little analysed, it will be found there is no foundation for the conclusions that have been hastily drawn from them. In the first place, the return of our births, marriages, and deaths is confined to England and Wales; in the second place, the amount of emigration from England and Wales is small—two-thirds of it is from Ireland, a country which does not figure in the returns of our births and population. Then we have to consider the different causes that have produced emigration from Ireland, and emigration from England. The emigration from Ireland is produced by a social system that has broken to pieces; it is produced, I may say, by the misery of the people. Now, the emigration from England is produced by causes exactly the Contrary to those I have stated with respect to Ireland. The people in this country were never better off, but they have foreign inducements that act upon their spirit of energy and enterprise, and they are determined to seek even better fortunes than they experience in their native land. That is the first point—that is the great difference between the causes that have produced the emigration of the two countries. The emigration from England is, in fact, only 100,000 a year, while there is an addition of 200,000 to its population. There is nothing, it would seem, excessively apprehensive in the fact that our emigration, stimulated by the higher aspirations of man, and not occasioned by a sense of misery, so far affects our population that 100,000 persons quit us, while the natural increase of our population is 200,000; but, even if there were 200,000 or 300,000 of our population quitting England, I could not view emigration, under such conditions as those under which the emigration from Great Britain takes place, as a source of weakness to the country, or, which is the point for us to consider, in speaking of the finances of the country—as a source of diminution in its consuming power. On the contrary—though one naturally shrinks from paradoxes upon a subject so grave—my own opinion is that it has a tendency to increase the consuming power. Every emigrant from England generally becomes an English colonist, and an English colonist becomes an English customer, and our markets are stimulated, our people ace employed, and their wages are improved by the very circumstance which some regard as tending to our decay and desolation. But, even if I look to the case of Ireland, where emigration takes place under conditions so contrary to those of England, I am still obliged to arrive at a similar conclusion. Have hon. Gentlemen remembered what the state of Ireland was a few years ago?—have they forgotten that memorable document, the Report of the Devon Commission?—have they remembered that description, which circulated throughout Europe, of there being in Ireland 2,400,000 paupers—that more than one-third of the people were receiving no wages of any kind—that they were living in hovels, littered on straw, feeding on dry roots, and often on seaweed? That was the description given by Royal Commissioners, under a Royal Commission, of a great portion of the people of Ireland. Well, then, you have got rid, in a certain degree, of that population. It is,. no doubt, a dark passage—it is, no doubt, a gloomy chapter, in the history of any country, that such events should occur; but I am only looking at it in a financial point of view to-night. I am bounds in bringing forward measures, such as, hon the part of the Government, I am now bringing forward, not to evade a-matter of such vast interest, upon die truth of which the whole of this subject depends. It is a question of the utmost importance—the consuming power of the people of this country. But although we have lost in Ireland more than one million and a half of the population, has the revenue of Ireland suffered a diminution in proportion to that loss? On the contrary, the revenue of Ireland, in its worst time, never very sensibly diminished. Between the year before the famine and the present year, there has not been a difference of anything like half a million. I believe in the former year the revenue from Ireland was very little more than 4,000,000l, and—I am sorry I am trusting my memory on the point—it is now, I think, 3,700,000l and upwards, and it is in a very buoyant state. I take the case of Ireland because we are there apparently labouring under very disadvantageous circumstances. All this shows that the consuming power of a people does not depend on their numbers, but on their condition; and I am persuaded that if the exodus, as it is called, of the Irish people continues, it will end even in Ireland becoming a much wealthier country, and that the consuming power of the people of that country will not only be sustained, but will increase. But, as regards Great Britain, I believe that the emigration that has taken place, instead of being a source of disquietude and alarm, is, in fact, the means by which the wealth of this country will be greatly increased; that it will have a most beneficial effect upon the people that remain; that it will develop their resources, and give opportunities to many that they never before possessed, and that the general result will be beneficial to the revenue, and the consuming power of the people will not only increase, but also the population. There is one point connected with this subject of very considerable importance. There is an apprehension entertained by some persons that there has been of late an unnatural rise in the rate of wages. Great authorities, I understand, are of opinion that the rate of wages is increasing so rapidly that the rate of profits will not only be diminished, but destroyed. Now, I am bound to say, that in pursuance of my duty, I have made inquiry into this subject; but I have not received any evidence of that extraordinary rise of wages of which we have heard. I believe that there has been a rise in wages: and I believe, moreover, that it has been very much to the public benefit; and that, if it continues, the public will be still more benefited. One thing, I think, is clear—that the consuming power of the country has not been diminished by the augmentation in the rate of wages. But, Sir, although the rate of profit depends upon the rate of wages, that is not the only element in this great question. There is another element still more important in its solution, and that is the rate of interest. The employer of labour may pay more to his workman— I hope he does; but the employer of capital is obtaining that capital at the present day on much more favourable terms, and with a facility which no employer of labour ever before enjoyed. Sir, the hon. Gentleman the Member for Wolverhampton (Mr. C. Villiers) said the other night that the discovery of gold, like the increase of any other article, gives activity to commerce, but does not give it more activity than any other article of exchangeable value; and he called upon me to meet him upon that point. I did not think that that was exactly the fitting occasion to go into that question; but I deny the position of the hon. Gentleman that the discovery of gold, like the production of any other article, while it gives activity to commerce, gives to it no more activity than would be occasioned by the increase of any other article. I maintain that it has not only given activity to commerce, but that it has influenced the commercial operations of this country to an extent which no other article could have exercised. I say, that the discovery of gold, considering the currency which we possess, has established credit in this country in a manner which no political economist could ever have imagined. I say that it has increased and confirmed credit in this country, and that that increase and confirmation of credit has, of course, proportionably increased the employment of the people. It would seem to be to be mere blind and obstinate prejudice to shut our eyes to that conclusion. But there is another question to be considered in regard to our prosperity at this moment, and that is, will the present low rate of interest last? I hope it will. My opinion is—though it is, perhaps, imprudent in me now to volunteer it—my opinion is, that whatever imprudences may occur—and I need not say that I deprecate them, but, notwithstanding some imprudences— the present rate of interest will mainly continue. It would seem to depend upon conditions and circumstances which hare never before prevailed in this country-natural circumstances and permanent conditions—and I cannot but believe that, if we only act with tolerable prudence, with such advantages as we derive from a low rate of interest, arising from natural causes, this country has before it an opportunity of material progress such as never occurred before to the vision of any statesman.

Sir, the Committee will remember that by the remission of taxation which I have proposed on the part of the Government, through the measures I have attempted to place before them, there will be a reduction of taxation to the amount of between 3,000,000l. and 4,000,000l. sterling. I shall have occasion hereafter to place the items more particularly before the House. But, by the remission which I propose in the malt tax, there will be a reduction of taxation to the extent of 2,500,000l.; by the reduction on the tea duties an immediate remission of 900,000l.; and by the reduction in the hop duty, the revenue from which, as you are aware, is fluctuating, but the average of which, I think, may be taken at 300,000l., I have, in fact, proposed a reduction of taxation to the amount of something between 3,000,000l. and 4,000.000l. sterling. But I must remind the Committee that, although this is only December, in a few months one of the principal sources of the revenue of the country will terminate, and that, if they support the propositions of the Government, they must not only encounter the great remissions of taxation, and, consequently, some considerable diminution of revenue, but they must likewise be prepared to deal with the consequences of a law expiring which now gives us more than 5,000,000l. sterling per annum—I mean the property and income tax. It will become the duty of the House, then, to decide what they will do with the property and income tax. Now, it has always been to me, as I am sure it must be to any Gentleman, exceedingly disagreeable to read to the House anything I may have said on a previous occasion; and I am quite sure that nothing would ever induce me to quote my own language by way of authority; but it is absolutely necessary that on the present occasion I should presume to Call the attention of the House to some remarks which I made on the subject of direct taxation when I laid before the House in the earlier Session of this year the financial statement, more especially as many Gentlemen are now in the House who were not then Members, I then called the attention of the House to the difficulty with which the revenue of the country was raised. I reviewed the objections which were made to indirect taxes in the shape of Customs duties and Excise duties—and I at last showed that, although there had long prevailed an abstract opinion in favour of direct taxation, yet all attempts that had hitherto been made to apply it to the raising of our revenue had only led to the conclusion that it was contrary to every principle of science and justice. I then said, speaking of the Committee on the Property and Income Tax then sitting, and whose opinion I naturally referred to with reserve, as they had not then made their report to the House—I then said— There is another point on which I can speak with more frankness in reference to the tax upon property and income. I have not presumed, and will not presume, to give an opinion upon the justice or injustice of a change in the mode by which the assessment of permanent and temporary incomes is effected. But there is a point, I believe, on which the Committee is so unanimous that their opinion need not be a secret; and it is also, I believe, the unanimous opinion of the House of Commons, as I am sure it is of the country—namely, that if taxes of this character— if measures of direct taxation like the income tax —are to form not temporary but permanent features of our system of finance, they cannot rest upon a system of exemptions. Well, but if they are not to rest upon a system of exemptions, do you augment the methods to which a Chancellor of the Exchequer may successfully appeal for the purpose of raising revenue? No doubt direct taxation is in its theory an easy, a simple, and a captivating process; but, when you wish to apply that direct taxation generally, it is astonishing the obstacles you encounter and the prejudices you create. Sir, to my mind—and I think it is a principle now pretty well established—-direct taxation should be nearly as universal in its application as indirect taxation. The man who lives in a palace, and a cottager, as consumers, are proportionally assessed. It is not perhaps, possible that in direct taxation you can effect so complete a result—perhaps it is not necessary; hilt that, if your revenue is to depend mainly, or in a great degree, upon direct taxation—if it is permanently to depend upon direct taxation, you must make the application of the direct tax general, is to me a conclusion which it is impossible to escape. No doubt, by establishing a temporary measure of direct taxation, based upon a large system of exemptions, you may give a great impulse to industry; you may lighten the springs of industry very effectually for a time; but—not to dwell upon the gross and glaring injustice of a system of finance that would tax directly a very limited portion of the population—but looking only to the economical and financial consequences of such a system, who cannot but feel that, in the long run, industry itself must suffer from such a process? For, after all, what is direct taxation founded on a system of exemptions? It is confiscation. It it making war upon the capital which ultimately must employ that very industry which you wish to relieve."—[3 Hansard, cxxi. 16.] I beg the House not to suppose that I have read this as any authority on the subject; but I feel that it is necessary that the sentiments which I uttered in the financial statement I made to the House six or eight months ago should he kept clearly before them. I also said— We deem it our duty to impress upon the Committee and upon the country the dangerous course in which they have embarked—to impress upon them the absolute necessity, now or in another Parliament, of arriving at some definite understanding on what principle the revenue of this country ought to be raised. We deem it our duty to denounce as most pernicious to all classes of this country the systematic reduction of indirect taxation, while at the same time you levy your direct taxes from a very limited class."— —[ 3 Hansard, cxxi. 35.] Now, Sir, I cannot say that subsequent experience has changed or modified my opinions on this subject. I am clearly of opinion that, if we have recourse to direct taxation, that direct taxation should be as general, at least in theory, as indirect taxation. How far it may be desirable to modify it in practice, on the ground of expediency, is a fair subject for consideration; but I hold that the practice of establish ing direct taxation on a large system of exemption is most pernicious, and ought as much as possible to be discountenanced. Well, then, Sir, I venture, in offering to the House the views which Her Majesty's Ministers entertain with respect to the property and income tax, to lay it down as a general principle that, in considering this question, we ought to make our direct taxation—in theory at least—as general as our indirect taxation. And, Sir, when I consider the very large exemptions which are connected with this tax, there is one which I am bound at once to notice, and take into consideration—the largest of all exemptions—and that is the exemption of Ireland. Now, Sir when in the early part of the year I proposed, on the part of Her Majesty's Government, that this tax on property and income should be continued for one year, I made no reference whatever to Ireland. The arrangement then made was avowedly a mere temporary arrangement, and it was therefore quite unnecessary to enter into the discussion then. But, having now to consider the question much more widely, I do not think it consistent with my duty to evade expressing the opinion of Her Majesty's Government on the subject. Sir Robert Peel, in his financial statement of 1842, when he first introduced the property and income tax, proposed to impose on Ireland, as an equivalent for the property and income tax, two other measures—the one was an increase of the duty on spirits, which, I remember, he estimated would produce 250,000l. a year, and the other was an increase of the duty on stamps, in matters affecting property, which he estimated would produce 160,000l.— making altogether 410,000l. a year. That was to be the contribution of Ireland to the revenue in another form, and as an equivalent for the exemption from the property and income tax. Now, I must remind the House—and it is disagreeable to have to discharge that duty—one would naturally like to be always taking off taxes, and never reminding any Gentleman that be had not perhaps paid those which had been expected of him; but it is necessary to inform the House that the measure for increasing the duty on spirits, which was estimated to produce 250,000l. a year, has since been rescinded, in consequence of its having been found to have stimulated illicit distillation; and that whereas in 1841, before the passing of the Property and Income Tax Act, the aggregate receipt from the stamp duties in Ireland was 470,000l. per annum; in the year 1852 they produced only 486,000l.; so that Ireland has contributed, as an equivalent for the property and income tax, instead of 410,000l. per annum, as was expected, only 16,000l. Well, Sir, but notwithstanding all this, it is impossible to be insensible to what Ireland has gone through during that interval. When Sir Robert Peel brought forward the income tax in the year 1842 it was impossible for him or the most experienced statesman to have foreseen the long catalogue of calamities which awaited Ireland. Almost every cause that could exhaust and every process that could debilitate a country and society have been brought to bear on that unhappy land. I freely admit, to use— not a classical, but a frequent epithet— that as regards its financial condition, Ireland since that period, or at least during many years, has been in a very exceptional state. But the state of Ireland is happily not now without a ray of hope. As far as I can form an opinion—and I can assure my Irish friends that I have taken the utmost pains to make myself acquainted with its condition—I think I may venture to speak of Ireland without using the language of despair, or the accents of desola- tion. You have had a crushing Poor Law; hut what is your present position with regard even to that overwhelming evil? Is it not mitigated—is it not more endurable? Permit me to place before the House a return of the present incidence of Poor Law taxation in Ireland. I don't want to insult any Gentleman by showing him that his country is not ruined—I prefer showing him that it possesses increased means of contributing to the national taxation. I am only anxious, in fulfilment of my duty, to convey, as far as I can, a correct view of the state of Her Majesty's dominions to Her faithful Commons. Now, I have here a "comparative summary, in provinces, of the expenses incurred in the Poor Law Unions of Ireland during the financial year ended September 29, 1850, 1851, and 1852 respectively." I find from that document that the Poor Law expenditure in Ireland in 1850 amounted to the vast sum of 1,320,000l.; that in 1851 it was reduced to 1,129,000l.; that in the year ending the 29th of September last the expenditure, which in 1850 was 1,320,000l., had been reduced to 885,000l. I find also that the decrease of expenditure in 1851, as compared with 1850, amounted to nearly 200,000l., or at the rate of 14 per cent; that the decrease of expenditure in 1852, as compared with 1851, was in amount 274,000l., or at the rate of 24 per cent; that the decrease in the expenditure of the year 1852, as compared with 1850, was in amount not less than 465,000l., or at the rate of 35 per cent. Now, Sir, I am sure, when one has this authentic return before him, he is justified in not altogether despairing of the condition of Ireland. In Connaught alone I find that the diminution of expenditure in 1852, as compared with 1850, was no less than 116,000l.—or at the rate of 48 per cent. Now, Sir, in looking to the condition of Ireland, I must call the attention of the House to another document before me, because it completes the picture of the incidence of Poor Law taxation, of which we have heard so much. I don't deny that our friends in Ireland have suffered from the severe incidence of taxation. I admit that they have gone through a terrible ordeal; but I say to them, as I say to the West India interest, "What I can do for you must be with reference to your present condition, and not with reference to the past." Now here is a document which reached me just before I came down to the House, and which) completes the picture of the state of Ireland with reference to the Poor Law of which we have heard so much, and from; which Ireland has suffered so severely. It is addressed to me officially, and is as follows:— You may remember that, in September last, the sum of 30,000l., being the greater portion of the balance of the Irish Rate-in-Aid Fund, was appropriated by the Treasury to the liquidation of the debts of certain unions in the west of Ireland, subject to the condition that any union assisted in this manner would thenceforth be Considered as excluded from the list of distressed Unions, and that, previously to such relief being recommended, the Poor Law Commissioners must be satisfied that proper provision would be made by rates for the immediate future requirements of the union. A report has been this day received front the Poor Law Commissioners describing the proceedings taken by them under the above instruction, from which it appears that all the unions affected by this arrangement, except the— Union"[I forbear mentioning the name]"have given the assurance and struck the rates as required, and that the reluctance of the guardians of the—Union to comply with the prescribed conditions does not arise from inability, but from a desire to transfer a greater share of the burden of their rates to the public. I don't wonder at the laughter of hon. Members, and that is the reason why I did not read the name of the union. This declaration of solvency, in respect to all the remaining unions of Ireland about whose power of maintaining their poor any doubt remained, is a fact of great importance, and you may think proper to refer to it in your financial statement. The object of establishing a comprehensive and complete Poor Law in Ireland has been finally accomplished, and the whole of Ireland is now able to maintain its own poor, without external pecuniary assistance from any quarter. There is still a balance of the Rate-in-Aid left of upwards of 12,000l., which will be more than sufficient to meet any more than usually distressed cases of particular electoral divisions. Such, then, is a picture of the condition of Ireland. I don't say it is perfectly satisfactory. Don't let my hon. Friends from Ireland suppose that I am malignantly misrepresenting them, and that I am not doing justice to their calamities. All I ask them to admit is, that having gone through great difficulties and borne them like men, their position is now very much improved. That is all I ask. But there are other reasons why there has been some discontent evinced that Ireland has not been subjected to the income tax. People are discontented that instead of getting 410,000l. from Ireland, as was* originally expected, when the property and income tax was imposed on this country, they have only got 16,000l. People, too, Have been disclined to remember—although I confess it is churlish—the actual circumstances of the case, and to forget the sorrows and calamities of Ireland; but there other complaints of a very different character, with regard to the non-extension of the income tax to Ireland. The Governor of the Bank of England has made an official complaint to me that at the present moment the Bank of England is pre-pared to purchase terminable annuities, but that it is impossible for him to contend with the Governor of the Bank of Ireland, in consequence of Irish funded property not paying the income tax. He says, "I have no doubt the Chancellor of the Exchequer will be receiving deputations from injured interests; but there is really no body more unjustly treated by recent legislation than the Governor and Company of the Bank of England by the property tax not being extended to Ireland." There is another point of view in which the subject ought to be considered. The amount of public funded property in Ireland is increasing yearly, and has for a long time increased, in consequence of its not being liable to the tax which the same description of property has paid in England. I mention this to show what a difficult thing an income tax is based upon exemptions. Now, Sir, I shall venture to treat this great exemption in the following manner. I do not think that it would be wise to treat with any harshness the landed proprietors of Ireland, They have suffered severely from the late famine and consequent legislation, and I should be sorry suddenly to pounce on Ireland and to say, "You shall pay your quota." I think we ought to do everything that is possible to assist that "wise, just, and beneficial" change that has taken place in Ireland; and I do not think it is expedient that we should throw any obstacles at the present moment in the way of the regeneration of that country. But I must say this, that, remembering what has been done for that country, I shall feel it my duty, when I lay before the House the schedules of the new property and income tax, to recommend an extension of the tax to funded property in Ireland and to salaries in that country.

Sir, an hon. Gentleman, a friend of mine, with reference to this subject, asked me the other night whether Her Majesty's Government were prepared to carry into effect the recommendations of the Committee of the House of Lords with re- gard to the Consolidated Annuities. The amount of the Consolidated Annuities is 240,000l. per annum, or something like that sum. Sir, the House will recollect how the Consolidated Annuities came into existence. There was a loan made to Ireland of nearly 10,000,000l. Subsequently that loan was reduced in amount to about one-half. I was always one who believed that that loan was in a great degree advanced for an imperial calamity, and that it ought, consequently, to be considered in that light; and I do not object to the arrangement then made in any sense whatever. But the House will understand that the balance of that loan, after being reduced by that amount, was thrown into the form of Consolidated Annuities, which were calculated with reference to the peculiar circumstances of each case. I must refrain from entering into the discussion of this question at present, but I think I am not free to avoid all allusion to the subject. I have shown to the House to-night that in 1852, as compared with 1851, there has been a diminution in the charge of poor-rate in Ireland of no less than 274,000l., and this is a sum considerably greater than the whole amount of the Consolidated Annuities. And I must beg of my hon. Friend who asked me the question to recollect what I have said with reference to those persons who in England are suffering from what they consider the unjust incidence of local taxation. I have shown that the reduction in the amount of pauperism is this year greater than the whole establishment charges, and I tell him also, that in considering this question he must remember that the state of Ireland is much improved since the recommendation made by the Committee of the House of Lords. Let me not be misinterpreted. It is the intention of Her Majesty's Government to consider the subject of the Consolidated Annuities; but they are not prepared to bind themselves in any way by the recommendations of the Committee of the House of Peers. The Government will consider the question entirely on its merits; and I have myself prepared, and will submit to the House, some Resolutions which I have carefully considered, and which I believe are justified by the circumstances, and will be beneficial in their operation; but I beg my hon. Friend not to go away under the false impression that the Government are prepared to carry into operation the recommendations of the Committee of the House of Lords.

With regard to the income and property tax, I have laid done one principle—that direct taxation should be as general as indirect taxation, and that a measure of direct taxation founded upon a large scheme of exemption ought not to be tolerated. With respect to that important measure, the property and income tax, I have to state another principle which Her Majesty's Government are prepared to assert, and that is to acknowledge a difference between permanent and precarious incomes. Sir, I will not enter into any arguments upon that subject at present. Although I have curtailed my observations as they have occurred upon the various topics which I have had to en-counter, and although there is much that I must still advert to, I feel that it would be impossible that I should on this occasion enter into a discussion which deserves, and will probably receive, on the part of the House of Commons, prolonged and mature deliberation. My duty now, I conceive to be, to make an exposition of the policy that Her Majesty's Government are prepared to recommend; and all I have to do is to place that before the House in as clear a manner as I can.

Sir, viewing the property and income tax with reference to the two principles I have laid down, namely, that direct taxation ought to be in its nature as general as indirect taxation, and that it ought not to be established upon a system of exemptions; and, secondly, that a difference should be recognised by the Legislature between realised and precarious incomes, I will now offer to the House the rate of duties such as Her Majesty's Government are prepared to recommend to the adoption of Parliament. Sir, notwithstanding the large remission of taxation which Her Majesty's Government have recommended, a remission of taxation immediately amounting to 3,500,000l., and eventually relieving the consumer of this country to a much greater extent, it is not the intention of the Government to recommend any increase of duty in any of the schedules of the property and income tax. I will first consider and state to the Committee the exemptions which Her Majesty's Ministers think it expedient to recognise and sanction. We shall recommend that on all industrial incomes the exemptions shall be limited to incomes below 1002. a year, that being the point at which we deem that wages enter into calculation. Upon incomes arising from property, we take the point of exemption at below 502. a year. Sir, I have now to detail to the House the; rate of difference which we recommend should be established between schedules B, D, and E, and the two' schedules of realised property. I have already told the Committee that we do not propose to increase the rate payable in schedules A and C. That will be taken, as hereto fore, at 7d. in the pound. We propose that the rate on the other schedules shall be estimated at three-fourths of that rate; and therefore it will be 5¼d. (which will be exactly three-fourths) on schedules B, D, and E. The produce of schedule A, at 7d., will be, as before, 2,649,000l The produce of schedule B, the farmers' schedule, will be estimated in this manner; —We take the estimate of the profits Of farmers, not at one-half the rent, as here-tofore, but at one-third. We have investigated that subject, and we find that, how-ever active trade may be, the whole ten-dency of late years has been to a diminution of profits, and we are persuaded that the test of the farmer's profits has been taken too high. We have taken, therefore, one-third the rent as the measure of profit, instead of one-half; and consequently, under schedule B, the farmers will pay 156,000l.; which in amount is exactly one-half what they pay under the present rate. From schedule C I calculate there will be received 746,000l. at 7d., as at present. Under schedule D, at the mitigated rate, the estimate is that 1,162,000l. will be received, and that under schedule E also, under the mitigated rate, 248,000l. will be received. The total of the five schedules will be, it is estimated, 4,961,000l. I estimate the increase—if the exemption is limited to incomes under 50l. upon property, and under 100l. upon industrial in-comes—1 estimate the increase at about 431,000l. But I think it right to say-that in that estimate I have taken into consideration the position of the clergyman whose income is under 100l. a year. The position in which he is placed, in the manner in which the duty is now raised, is extremely severe, and I may say unfair. He is rated under schedule A at the highest scale, whereas a Dissenting minister who has 100l. a year, being rated under the scale of salaries in the mitigated schedule, would have an advantage of the mitigated rate, and with an income under 100l. per annum would have the benefit of a total exemption. The position of a clergyman is, in fact, the position of a person working for a salary, but, from the nature of the property from which he derives the sources of his maintenance, he is deprived of the advantage of the mitigated schedule. And there fore it is necessary to make special provision for him, because he must still be, assessed under schedule A. I have estimated the probable diminution from giving clergymen the benefit of total exemption under 100l per annum at 30,000l., but I have taken that into account, and it will not affect the figures which I have put down, of 5,361,000l., as the produce of the income tax. I add for Ireland the modest sum of 60,000l. The total sum will be about 5,421,000l. Generally speaking, I think I may say that the result will be, that the property and income tax will about produce the average that is produced by the present existing Act. Perhaps it may be advisable for me to make provision for some slight diminution; but, generally speaking, I think the average will be about that of the last three years of the present tax; and, therefore, if the House should adopt our proposition, I think the result would not materially affect our financial income.

Assuming, Sir, for the moment, that the property and income tax as I have now laid it before the House will not affect our Budget of the year, it is now necessary for me to approach the Ways and Means by which the diminution of the revenue, occasioned by the measures that I have recommended on the part of Her Majesty's Government, may be met. It is necessary for me, however, before I enter upon that, to make some reference to a subject of great interest, which will have the effect of increasing the public expenditure. Sir, it will be my duty on an early occasion to place before the House a supplementary estimate for the expenditure of the present year with reference to the national defences. It will, of course, be necessary in the usual financial statement for the year 1853–4 to make an estimate which I shall have to place before the House, and to take into consideration the whole expenditure of the year; and, therefore, that will be the more convenient moment to advert to that subject. Sir, I know the great difficulty and delicacy of touching on a subject of this kind, but in my mind the difficulty is much increased and the delicacy becomes much greater by a prudish affectation of reserve, than by speaking to the House with the same frankness with which I should address them upon a less formal occasion. Sir, we are about to propose an increase—-and no inconsiderable increase—in the estimates, and we may be met with the question of peace or war. Now the fact is, that the measures which we are going to lay before Parliament, and which we have the confident hope that Parliament will adopt, have nothing to do with peace or war. We should have brought them forward under any circumstances, and I believe that those who have preceded us, or those who may succeed us, would act in the same manner. Sir, when we came into office we found the estimates for the year already on the table; we accepted them on the understanding that there should be no delay interposed, but that we should be enabled, as soon as possible, to appeal to the verdict of the country; and, as there was a general understanding that they were the estimates of our predecessors, they were passed without being canvassed, and thus the progress of public business was facilitated, and the appeal to the people hastened. But, Sir, the subject was one that necessarily engaged the attention of the nation, and it was one also that must engage the attention of any Cabinet that is charged with the conduct of the Government of the country. It matters not what may be the original cause—it matters not what dynasty may be upon the throne upon the other side of the Channel—it does not turn upon what may have been said or done elsewhere—that the attention of the nation has been drawn to the state of the national defences. That attention was drawn originally by the highest military authority of the land. The effect of being so long-in peace was brought to the consideration of the most industrious people in the world; it was drawn to their consideration while all the tendencies of the age seemed to secure tranquillity and happy repose. I say, that there was no panic or precipitation, but, on the contrary, a prejudice against what the people of this country supposed to be disturbing the dreams of repose and prosperity in which they indulged. But sooner or later the idea seized the public mind. It was taken more and more into consideration, and, totally irrespective of external circumstances, the nation arrived at the conclusion that this country was not in that state of defence that is necessary and desirable. They arrived at the conviction that it was of primary importance that the shores of this country should be protected, and that its defences should be complete. If I were asked, on the part of Her Majesty's Government—in no other way would I presume to give an opinion—what I thought was the tendency of the present age, and what the general course which present circumstances indicated, I should say, without reserve, speaking from the bottom of my heart and in alt sincerity, that I believe the predominant feeling of the present day was peace. But I believe the measures Her Majesty's Government intend to recommend to Parliament will tend to the preservation of peace. On considering this subject after the general election, we felt it to be our duty to lose no time in recommending the necessary measures. If it be a fact—and I assume that it is a fact—that this country is not properly defended, and that it wants to be properly defended, let due preparations, we say, be made for its defence. On considering the question, we thought the best thing was to do it completely. We thought the best thing to do would be to put the Navy of this country in the position which we believe all Englishmen wish to see it; and the plans we have matured, and which, if the House will support our proposition, will be carried into complete effect, will be plans which will settle this question of our national defences for ever; that is to say, you will have all your arsenals and strong points in the kingdom defended, and you will have a real Channel fleet, which can assemble from its different rendezvous at the moment necessary, and which is the proper garrison and protection of the country. It would have been more convenient for Her Majesty's Government to defer the question -as they would have done, if they had not felt it to be their paramount duty to bring it at once before the House of Commons. They were busied with measures the tendency of which, they believe, will be in due time to reduce the expenditure and the establishments of the country. But they felt that it was totally impossible to mix up a question of this importance, and, from its nature, of this urgency, with questions of administrative reform. They felt that, if the country were not properly defended, and if the people wished it to be properly defended, the question was one which ought at once to be completely and definitively settled. Sir, we have taken those steps which we believe will insure the complete defence of this country. It will be necessary for me to ask for a supplementary estimate, so far as this year is concerned. I hope there will not be any difficulty raised on the part of the House. The state of the finances of the country, as I shall show in a few minutes, will perfectly authorise me in asking a supplementary grant for the present year, to be supplied from the Ways and Means; and next year we shall ask your approval of an estimate which will increase our general estimate about 600,000l.

Well, Sir, having told the Committee that it will be my duty to ask its assent-to a supplementary estimate for the expenditure of this year, which has occurred since the Appropriation Act passed, I think it will be convenient if I give some account. of the state of the finances, so that the Committee may form an opinion as to what our surplus will probably be at the end of the present financial year, from which the supply must be afforded for the supplementary estimates for the expenditure of the year since the appropriation. The Committee will recollect that in the early part of the year, when I offered to estimate what would be the surplus, I said the surplus would be about 460,000l.; but, in. making that statement, I mentioned my intention of asking a vote of 200,000l. additional for the Kafir war. The Committee will perhaps recollect, that on a subsequent occasion I came down and announced that it was not necessary to ask for that vote; therefore the estimated surplus, according to my statement, was virtually a surplus of 660,000l. There baa been a reduction made in the interest of the floating debt amounting to about 40,000l., and that, in fact, would make the estimated surplus on the data which I had before me early in the year, 700.000l. I shall show the Committee how our finances are working since the commencement of the financial year on the 5th of April last. The state of our revenue is extremely favourable. I calculated at the beginning of the year that there would be a diminution of something more than 100,000l. upon the Customs. I took into -consideration the stimulus of the Exhibition given last year to consumption, and also the further reduction which has taken place in the sugar duties. I thought, therefore, that we ought not to press too much on the Customs; that they had done their duty very well, and that we should not he alarmed this year if there was some slight diminution. The two causes to which I hare referred—the great stimulus given list year to consumption by the Exhibition, and the further reduction of the duty on sugar—would, in my opinion, occasion some diminution, which I estimated at something about 100,000l. I think there will be that diminution of about 100,000l. in the Customs. From the commencement of the financial year to the present time, the decrease has fluctuated from one month to another; it has not been always such as would give a result of 100,000l.; at this present time it would give a little more; but, I think, my estimate will be exactly fulfilled. I estimated an increase of about 50,000l. in the Excise. There is at present a much greater increase in the Excite; but I am not prepared to say that at the end of the year the estimate will be exceeded; it may, perhaps, but I think we ought not to take account of that. I estimated that the Stamps would be about the same as last year. They have increased every week since the beginning of the year. Their increase has never for a moment fluctuated; and the total increase on Stamps from the 5th of April to the 27th of November, has been nearly 300,000l. I estimated a considerable reduction in the Property Tax. I said it was necessary to calculate that we might lose 150,000l. on the Property Tax. The Property Tax, like the Stamps, has been increasing every week progressively; and at present, instead of a loss of 150,000l., there is an increase of 187,000l. It would be neither convenient nor possible to give anything like a positive statement on the subject at present; but I thought it would be agreeable to have these facts brought before the Committee in an authentic manner. I will now state my estimated surplus as virtually a surplus of 700,000l. It will be safe on the part of the Committee to add 500,000l. to that from the Inland Revenue. There will be some other increase of which they will have to take account; but certainly I think that our surplus for the current year, taking the most prudent and the coldest calculation, will, on the 5th of April, instead of being 460,000l., as I estimated when I made my financial statement, be something approaching to 1,000,000l. more than that. I think the sum will be 1,300,000l. or 1,400,000l. I think, under these circumstances, I may ask for a vote for the increased expenditure incurred this year.

Sir, I mentioned that it was the hope and intention of Her Majesty's Government, if they were permitted to follow the course they had chalked out for themselves, ultimately, but not precipitately, to effect no inconsiderable reduction in the expenditure of the country. This, I think, is a subject which has hardly yet been fairly dealt with. Hitherto we have considered that retrenchment, and not efficiency, was the parent of economy. A Government has reduced estimates from the necessity of the moment, and there has been an apparent reduction in expenditure; but it has been always followed by a collapse, and generally the unfortunate office of supplying the deficiency of one Administration has fallen to their successors. One Administration cuts down; another is obliged to increase; and, so long as it is made a mere question of pounds, shillings, and pence, I am certain that no permanent and substantial reduction in the expenditure of the country can be obtained. I think it is the duty of an Administration to look to the efficiency of the establishments of the country, and not to the rate at which they may be maintained. If you only make your establishments efficient, you will find almost as a natural consequence that you will save money; and therefore I take it to be efficiency, and not retrenchment, which is the true parent of economy. To effect reductions in the establishments of this country is about the most ungracious task in which an Administration can embark. There is nothing easier in Opposition than to call for retrenchment; there is nothing more difficult in Administration than to comply with that demand: so long as you leave your existing establishments founded on the same principles, and carried on in the same spirit, you will arrive at the same result. I do not mean to make any observation which shall seem at all to cast censure on those by whom the permanent civil service of this country is carried on, and to whom those engaged in the administration of affairs have been so much indebted—on the contrary, the other night I had occasion to offer my tribute to their invaluable services. What they do, they do in the best manner; but they are not responsible for the establishments of the country. It is our opinion that the system of administration is not as advanced as other great operations are in this country. Whether we look to our commerce—whether we loot to the other occupations of man—these have undergone more change with reference to the circumstances of the age than the establishments by which the administration of the country is conducted. How are we to deal with these immense difficulties? If you attempt reform, you have to meet the two most formidable obstacles in the world, prejudice and skill. The person who presides over a great department does not like your interfering, and he has more knowledge than you have. What can be more difficult than to effect a reform under such circumstances? I have a great respect for the House of Commons, to which I owe everything, and there is no one who more highly esteems the labours of the Committees of the House than I do. If I wanted a Committee on the state of India, for example, I do not know that I could find anywhere a body of men who could conduct such an investigation in a manner so satisfactory. You bring a large body of men round the table—skilled statesmen, eminently qualified for investigating political and financial subjects. You bring to bear on public questions the knowledge and experience of those best qualified to arrive at just conclusions, and of men of the world. But if the House of Commons, by means of a Committee, were to examine into a great public department, you would not arrive at a similar satisfactory conclusion as if the same men were investigating the affairs of India, or the operation of the Factory Act, or any subject of general interest in which the information, intelligence, and temper of men of the world may be brought to bear. You have too many men; you have men of different political opinions; and the results have been always that the inquiry has been fruitless. You have had Committees of Inquiry with respect to the Army, Navy, and Ordnance. What have you done? Nothing. But I say this: if you want administrative reform, why not apply to your great offices the same principles as those which you apply to your revenue departments? Issue Commissions, and make the Government responsible for the information they acquire, and make them act upon it. I assure the House that the Government are sincere in their attempts to effect administrative reform. There is a question of great importance, with reference to these, reforms, which has long been recommended to the attention of the House of Commons; that is, the bringing of the whole revenue of the country under the control of Parliament. Well we are pre-pared to recommend such a. course; and when these financial measures are passed, I will take an opportunity of bringing the subject of administrative reform before the House, and I shall then explain in, more detail what it is possible for me now only to touch upon—indeed, it is barely possible for me thus cursorily to advert to so important a subject—but I shall then explain the measures which Her Majesty's Government are prepared to propose, If they are supported in these measures, I believe that the effect would be most beneficial; and I believe that you will secure a reduction in the public expenditure.

There is a point on which I wish to ask. the consent of the Committee. There is an establishment called the Public Works Loan Fund Commission. It is my intention to ask the House to terminate the operation of that Commission. The nature of this establishment is as follows:— It was founded on principles exactly opposite to those which at present prevail, and was organised under circumstances exactly opposite to those that now exist. In 1817 there was a surplus of labour and a deficiency of capital; 200,000 soldiers' and sailors had been dismissed from the Army and the Navy. It was thought necessary to give them factitious employment, and a certain body of men was appointed, who acted gratuitously, and with the greatest zeal, integrity and ability throughout the whole time as Commissioners; and Exchequer-bills were issued in order to give employment to the people. This system went on till about ten years ago, when the issue of Exchequer-bills was arrested, and a certain annual sum was allotted from the Consolidated Fund. That system had gone on till, as I said, the circumstances are' exactly the reverse of those in which that Commission was riginally appointed. Instead of a surplus of labour there is a deficiency; instead of a want of capital, there is a plethora. In consequence, the Commissioners have a large balance at their command, and the system is of itself an extremely injudicious system. We propose—and I will state on the proper occasion the reasons why we think so— that this Commission should terminate and that the repayments of the advances shall be brought into the revenue, as part of the Ways and Means—like"Old Stores."

Sir, my task is nearly terminated; and if I have somewhat abased the patience of the Committee, I can only say, with great humility, that I hardly think any person had ever in the same time to compress so many topics into so small a compass.

It now, Sir, becomes me to explain to the House the Ways and Means by which I propose that we shall accomplish the policy which Her Majesty's Government contemplate. I will now offer to the Committee an estimate with reference to the year 1853–54, so far as reduction of or increase in expenditure are concerned on the one hand, and so far as Ways and Means are concerned on the other. I do not, of course, pretend to offer a formal estimate of what the various services will require in 1853–54. It would be perfectly absurd to offer such an estimate, and the House will not be so unreasonable as to ask it. If we remain in office, it will he my duty, at the proper time, to go into those necessary details. But I wish to take the year 1853–54, and to show what, in our opinion, will he the effect on the expenditure occasioned by the reductions we propose, and the increased estimates, and what we must supply by extraordinary Ways and Means. I take the reduction of the malt tax—making allowance for putting an end to the Scotch drawback, and for the difference of duty levied on malt from barley, and from here and bigg, to amount to about 2,500,000l. That reduction will not come into operation until the 10th of October, 1853; but on that day it will be necessary for me to be prepared to pay the drawback on the stock in hand on which the reduced duty will be then levied. I take for that drawback the sum of 1,000,000l. The reduction of the duty on tea to 1s. 10d a pound, calculated on a consumption of 54,000,0001b., but subject to an increased consumption of 6,000,000 lb., will cause a loss to the revenue in the year 1853–54 of 400,000l. on the present amount of revenue of 6,000,000l. The extra estimates—

MR. HUME

What will be the loss on hops?

The CHANCELLOR OF THE EXCHEQUER

The duty on hops will not be affected in the financial year 1853–54; it is all payable now for that year—and the proposed reduction of duty will not come into operation till the year 1854–55. The extra estimates for the ensuing year I take at 6o0,000l.—and perhaps I may be permitted to say—as hon. Gentlemen may be alarmed at the idea of increased estimates— that I have received, not the Army Estimates for the year 1853–54, but a private memorandum as to their results. I don't want to boast of the fact, but by that document there is a diminution on those Estimates. But I put the extra Estimates at 600,000l. I put the Light Dues at 100,000l.; therefore there will be an extra demand upon our resources to the amount of 2,100,000l. [An Hon. MEMBER: 3,000,000l.] In order that there shall be no mistake on the subject, I will just read the items again. The loss upon Malt for the year 1853–54 will amount to 1,000,000l.; the loss on Tea to 400,000l.; the extra Estimates will be 600,000l.; and the Light Dues, 100,000l. —thus making 2,100,000l. Well, now for the Ways and Means. First, as to the Surplus Revenue for the year 1853–54. I have shown to the House that we may take our surplus for this year at 1,325,000l. or probably at 1,350,000l. I hope I shall never have to move another vote for the Kafir war. That came into our Budget last year to the amount of 460,000l. I think, however, it would be imprudent to take credit for the whole of that 460,000l. in our future calculations, although our recent accounts from that quarter are of an extremely favourable character, and although, so far as the financial question is concerned, which conies mora immediately under my notice as connected with the Commissariat, I am very sanguine on the subject. Still it is not at all impossible that we may have to propose a financial vote for extras on account of the Kafir war; I should, therefore, say we ought to take off 200,000l. on account of that charge. I take, therefore, the surplus for the year 1853–54 at 1,600,000l.; I take the repayments, if the House accedes to my proposition with regard to the Public Works Fund being paid to the public Treasury, at 400,000l.; that together will make 2,000,000l.

It now becomes my duty to propose to the House the means by which we shall be able to increase the revenue of the country. That, it will be admitted, is the most difficult thing in the world. But, if I had the best case possible, I am not sure that I should be able to obtain the attention of the House to any extended remarks of a general nature, having already wearied the House so long, and being myself, I may unaffectedly say, quite exhausted. If, however, the measures which Her Majesty's Government have to propose are to he carried out—and they are measures which, in my opinion, will conduce greatly to the benefit of this country—it is absolutely necessary we should put our finances in a sound position; and this is what I am most anxious to do. I want to put those finances in such a position and on such principles as shall he most advantageous to the community at large, and not to a class. I beg to observe that I have not even adverted to any particular class. I beg the Committee to recollect the general features of our plan. I have on the part of Her Majesty s Government considered the claims of all those classes which, it is now universelly admitted, have been injured by "recent legislation."["No!"] Has not the shipping interest been injured by "recent legislation?"—["No!"]—and are we not going to afford that interest relief? ["No, no!'] I beg to remind the House that I have, on the part of the Government, considered all these claims, and, I hope, in a sound and a kind, but, I am sure, not in a partial spirit. I have endeavoured, so far as I possibly could, to make propositions which should terminate those claims of classes, of which, I confess, for one, I am wearied. I have endeavoured to encourage in the House a spirit of legislation which, by creating a general feeling to unite in what may pertain to the public good, and by Studying the interest of the community at large, shall show to all classes, whether manufacturing, commercial, shipping, or agricultural, that in supporting a legislation that seeks the good of the community they are, in fact, obtaining that stimulus to their own peculiar occupations which they all naturally desire. Sir, I think on the part of my friends these propositions have been met in a kind and generous spirit. There has been no attempt on their part to parade the unequal incidence of local taxation, which no man can deny they are subjected to. No man can deny that there has been a willingness on their part to adopt such an inequality, in regard to those local charges to which they are subject, in order to arrive at a complete and final settlement of this vexatious question. It is more than probable, however, that in such measures as may be brought forward, more immediately connected with their own interest, they will find their advantage and that relief which otherwise they might churlishly have sought to obtain by mea- sures having solely reference to these culiar burdens, to which they have been so long subjected. I think I have witnessed this spirit, and that the tone in, which my friends, representing more particularly the agricultural interest have met these propositions, is one which has shown them to be superior to all petty considerations, and that they are anxious to merge them ill a strong national feeling.

Well, Sir, I now feel it my duty to propose some addition to the resources of the country. I will not propose any additional duty on the Customs. If we are to embark on a new system, let us do it fairly and completely, I have had proposed to me, and I dare say many persons have had proposed to them, schemes showing how the revenue may be raised by imposing a Customs duty upon articles on which the duty was perhaps precipitately and needlessly repealed. But the repeal of those duties is a part of the system which you have finally adopted, and I will not meddle with such arrangements. So far as any measures which we bring before the House are concerned, we will bring them forward in complete harmony with that great principle of unrestricted competition which the House has adopted; nor will we offer any plan for increasing the revenue which we do not think founded on the best principles of finance. Neither, Sir, are we going to propose to increase the revenue by means of indirect taxation. I will not now enter into the merits of the Customs and the Excise as portions of a system of finance; but this I will say, that although we are compelled to raise a great portion of our revenue by means of indirect taxation, it is absolutely necessary, if you will maintain the principle of unrestricted competition, that all indirect taxes, should be moderate in amount. Well, Sir,, I am not going to propose any new tax-That, at least, is a point in advance; that makes less the difficulties I have to contend with. I am not going to propose a new tax. I am going to ask you to consider an existing tax. I am going to ask you to apply to that consideration the principles you have always supported; and I am going to test you whether you are sincere in the great effort to relieve the industry of this country from that yoke of excessive indirect taxation, from which it has suffered so long. I am going to ask the Committee to consider, the present arrangement of the house, tax Now, Sir, I trust the House will listen to me with kind patience. I know the clamour that has existed in this country about the house tax. I am not imposing a house tax. It exists. All I ask you is to consider the principle upon which that tax is Constructed. I don't know any portion of the country that has ever made greater opposition to the house tax than that portion of it which ought to be the most enlightened and public-spirited portion of the people of this country—that is, the inhabitants of the metropolis. I remember that the moment the inhabitants of the metropolis had gained political power they agitated against what they called the iniquitous house tax. But sound principles of finance were not too prevalent in those days. The inhabitants of the metropolis at that time were subjected to a very heavy taxation, and I don't know that their general complaint against the weight of their taxation was unreasonable. Being suddenly invested with political power, they rose against the immediate object which excited their attention. Remember, the inhabitants of the metropolis were subjected then to an enormous system of direct and indirect taxation. They were subject to direct taxation connected with their houses double in weight to the amount of the house tax—namely, the window tax; and, in addition to all this, they were subject to that which they have subsequently told us was infinitely more grievous, infinitely more vexatious, and infinitely more injurious than all taxes —namely, the corn laws. Now, just let me remind the House of the real state of affairs as regards the house tax. Since that time—namely, in 1834—the duty on houses was repealed. It amounted, as a revenue, to 1,198,000l. Since that time the duty on windows has been repealed, amounting to 1,950,000l., making together the sum of 3,148,000l.; since that time the duty on glass has been repealed, amounting to 800,000l., 400,000l. of which, by the official return I have, was paid by houses for windows of crown glass. Since then the duty on bricks, amounting to 465,000l., and the duty on timber, to the amount of more than 1,500,000l., have been taken off; and certainly I may say that one-fourth of the duty on timber was contributed by houses. Besides all this, nearly 15,000,000l. of indirect taxation have been repealed, and, besides all this, too, the corn laws have been repealed, which so many believed to have been a more grievous kind of taxation than all the other indirect taxation from which they had been relieved. Well, Sir, I need not say anything, at least to-night, with respect to the justice of the house tax. The greatest writers are agreed that no tax is more free from objection than the house tax. I need not say to-night to my predecessor, who, I see, is exhausted as well as myself—I need not say anything to him to prove the excellence and the justice of a house tax, for he has introduced one himself. But what I would venture to say is, that I cannot believe that when I make a proposition which is only to reconstruct on juster principles—principles which have always been eulogised in this House—an imperfect law, as it at present exists, and that when I ask to be permitted to do that in order to carry measures which will relieve to a great extent the industry of the country, and animate in the most conspicuous manner all the great branches of our trade, I cannot think that I shall hear in the year 1854 those objections to a house tax which were heard in 1834. I believe, indeed, that the persons who were most clamorous against the house tax in 1834 are now men of more enlightened minds—men who have made too much progress in this great age of improvement in which it is our fortune to live, to come forward and say that they prefer the old system of finance, which threw the chief burden of taxation on the industry of the country, rather than bear their quota in this great effort for terminating as far as possible the vexed question of taxation. I will recall the attention of the House to the principles on which the present house tax is established. It is direct taxation— and it is remarkable for all those imperfections which we say direct taxation ought not to be distinguished by. You say with regard to the income tax that a system of exemptions is intolerable, and you have encouraged me this evening, in my limited efforts to the adoption of a plan by which exemptions shall be considerably decreased. What, then, can you say to a house tax which limits its operation to houses of 20l. value? I want to know who can possibly defend a law of this kind? If my hon. Friend the Member for Montrose (Mr. Hume), who advocates, with respect to the income tax, such legitimate conclusions, be sincere, he cannot be in favour of a house tax limiting its operation, and exempting so large a proportion of the subject matter of it. [Mr. HUME: I divided the House against it.] That is the very thing I want. Three times have I tried to get the hon. Gentleman to say that, but I could not. I wanted to hear that from his own lips, because I was afraid that some of his new companions might have fallen into the error of supposing that my hon. Friend was not in favour of those principles which I am now advocating. But I know my hon. Friend is in favour of those principles, and I hope that he will assist me in the temperate and moderate proposition I am making. I think, we ought to extend to the house tax that principle we are attempting to extend to the income tax. Exemptions are a suspicious feature in all financial systems; and nothing can be more ridiculous than to say that a house which is not rated at 20l. a year should be exempted, while a house at 20l. a year should pay the tax. Therefore I think we ought to extend the house tax; and, in the same spirit in which I would propose any of those measures I have named to-night—not wishing to push the principle to an extreme, but trying to form the public mind by degrees to a system which, I am convinced, will contribute to their welfare and prosperity, I should say it is not an unreasonable proposition to extend the house tax to houses of 10l. a year. Well, Sir, at present private houses pay 9d. in the pound, and shops pay 6d. in the pound. The exemption commences at below 20l. It is impossible that a house tax could be proposed with scantier limits. I felt at the time the tax was proposed, that, both as to the basis upon which it was formed, and the rate at which it was assessed, we were sanctioning (with great respect to my right hon. predecessor I say it) a very injudicious measure. I remember in the middle of the Session I made a feeble effort to arrest its progress, and received the sanction of the right hon. Gentleman the Member for the University (Mr. Gladstone); but it was useless at that time to oppose the measure, though I felt we were sanctioning one which we should all some day regret. I think we ought to increase the basis of the tax, and that it would' be a moderate proposition if I suggest that its present basis should be extended to houses of 10l. a year. I don't mean that; we should for ever stop at 10l. I do not lay that down as a final proposition; but it is an advance in the right direction, and it is all I can venture at this moment to recommend. Then again, I think we ought to increase the rate. We must remember, that if the measures with which this proposition is accompanied are passed, a very great difference will be made in the position of the inhabitant householders; that those who are in trade will have, for the first time, recognised a difference between realised and precarious incomes in the contribution to the property and income tax—a recognition gratifying to their feelings, as well as advantageous to their interests; that a very great reduction will be effected for them in the price of two of the principal articles of domestic expenditure, by their having cheap beer and cheap tea; that the changes we propose, if agreed to, will give great impulse to their industry in largely promoting the trade and commerce of the country. Since the public first objected to the house duty, they have got rid of that duty —they have got rid of the glass duty, of the brick duty, and much of the timber duty; they have been relieved from that immense mass of indirect taxation to which I have referred; from the operation of the corn laws, to which many of them objected as the worst taxation of all; and from the window tax. And now I want to recall to the recollection of the Committee—as important to the equitable adjustment of the question—the circumstances under which the tax on windows was taken off in 1851. That repeal was not asked for by the inhabitants of houses as a relief from the burden of taxation, or because it was a grievous or vexatious tax in a financial point of view:—of course not—as conscientious, honest, honourable men, they could not put the matter in that light, after they had been relieved from the house tax, from the brick tax, timber tax, glass tax—from the general mass of indirect taxation I have spoken of—and when, above all, they were revelling in their relief from the corn laws. Oh, no! nothing of the sort; they all said that the country was never more prosperous, themselves never more happy, never more contented, and they sought the, repeal of the window tax upon no financial grounds at all. What they urged upon the House, in connexion with the subject, was simply and solely the sanitary condition of the people, and they objected to the window tax, because they said, it affected the sanitary condition of the people. The allegation was admitted by the House, and the tax was put an end to. Now, if, without affecting the sanitary condition of the people, we could supply the Exchequer by a reconstruction of that house tax, which they did not seem on principle to object to—by the amount of the contribution which the inhabitants of houses formerly paid in the shape of a window duty, which they only objected to only on sanitary grounds—this cannot, I apprehend, be looked upon as an immoderate proposition. But I do not propose, in the first instance, to go so far even; I do not propose a scheme that shall levy so great a tax on the inhabitants of taxable houses as they paid in the form of window tax. My proposal is, to levy the tax upon an enlarged area, so that whatever may be its amount, its incidence may be lighter. I shall make a moderate proposition, and yet one that will enable us to place the finances of the country on a sound basis. I propose to extend the tax, as I before said, to 10l. houses, and that private houses rated in the whole at 15,854,126l. shall be assessed at 1s. 6d., and shops rated at 10,698,452l. shall be assessed at 1s. in the pound; the whole produce being 1,723,000l., that is, about one million sterling more than the present produce of the house tax, and 225,000l., if I recollect aright, less than the amount of that tax upon windows, which was objected to solely on account of its effect on the sanitary condition of the people.

Now, Sir, having made that proposition, I may complete my estimate for the year 1853–4; it having been necessary for me to enter into these details in the middle of that estimate. I have shown that the extraordinary demand upon us in 1853 will be 2,100,000l., the extra Ways and Means 2,500,000l. We shall, in this year, have only half the increase of the house tax, if the House assents to it—so that upon the whole, there will be 2,500,000l. of extraordinary Ways and Means to meet an extraordinary expenditure of 2,100,000l. As to the year 1854–5, the estimates show a loss on the malt duty of 1,700,000l.; there will be a loss on tea, by the further reduction of the duty of 2d. —allowing for the increased consumption, which I estimate at 4,000,000 lb.—there will be a total loss on tea of 567,000l.; on hops, of 120,000l., by light-dues, 100,000l., and on the whole, with the increased esti- mates of which I have spoken, a total sum of 3,087,000l. to meet. Now for the Ways and Means. There will be, I estimate, in 1854–5 a surplus of 1,800,000l., for I cannot conceive that there will be any claim then on account of the Kafir war—repayments will amount to 400,000l.; half of the Three-and-a-Quarter per Cents will come in, for which benefit we are indebted to the most successful of modern Chancellors of the Exchequer, who had twice the honour of reducing the public debt, 310,000l.; and we shall further have the whole of the new house tax, 1,000.000l.; making, in all, a sum of 3,510,000l., or something less than 500,000l. more than the deficiency to be supplied; and this, I think, represents a not unfavourable condition of finance.

I have now, Sir, endeavoured to place before the Committee those measures of financial and administrative reform which Her Majesty's Government are prepared at once to bring forward. The hon. Member for Montrose seemed to be surprised that no provision was announced with regard to the stamps on marine insurance and charter-parties. I would point out to my hon. Friend that this is one of those financial matters which could not be considered as coming within the scope of this preliminary statement. The Government has contented itself, on this occasion, with propounding those measures which it is prepared, with the sanction of the House, to bring into immediate operation. We have studiously abstained offering any opinion on any branch of the system of taxation on which we are not prepared immediately to act. The measures which we have thus announced are essentially practical measures. If the House sanctions them, they will, in our opinion, lay down sound principles of finance which will lead to results highly beneficial to the people of this country, and be the foundation of further measures, which we believe will prove still more beneficial. It does not become us, according to our sense of duty, to offer anything to the House of other than a practical nature, or to make any proposition which we are not prepared, with the sanction of the House, to carry immediately into effect. At the same time, we have not neglected carefully to examine the question of the stamp duties and the probate duties; and we think it not impossible to bring forward, on the right occasion, a duty on successions that will reconcile contending interests, and terminate the system now so much complained of. At present, however, we are not prepared with a measure of that kind, and we consider it, as I have said, altogether injudicious to propound any project to the House which we are not ready at once to act upon. We think we have proposed enough to-night; and we think that what we have proposed is of a character, that if acted upon, we can judiciously advance a step further. I admit that what I have now proposed is only a first step, hut I trust the Committee will admit it to he a step in the right direction; we have met the great question in a large and comprehensive spirit, fully prepared, if the House will support us, to carry out the policy which I have to-night, most inadequately, I am aware, indicated to the Committee— a policy which we believe will he for the welfare of the country, because it is a policy founded on sound principles of finance, and because it has been framed with no other object than to govern the country in the manner that shall most conduce to the greatest happiness of the greatest number.

On Question "That a sum of 17,742,500l. be granted to Her Majesty to pay and discharge outstanding Exchequer Bills,"

MR. GOULBURN

said: It is not my intention on this occasion to enter into the extensive field of inquiry opened up by the statement of the right hon. Gentleman; but I wish to put one or two questions on points which he has not very clearly explained. He has omitted to state whether he proposes the income tax as a permanent tax for the future or not—a point most important in dealing with the question. I should also be glad to know whether the right hon. Gentleman, in reducing the malt duties, intends to repeal the prohibitive duties on the importation of foreign malt, and whether, also, he proposes to repeal the import duty on hops? The right hon. Gentleman will perhaps also state what he proposes to do with regard to the use of molasses in breweries, and with respect to the equalisation of the duties on rum? I further desire to enter my protest against a principle which, as I understand, is enunciated by the right hon. Gentleman. He proposes, if I understand him right, to impose a higher rate of income tax on income derived from funded property than that which he proposes to impose upon other classes of property. In Ireland the tax will be imposed on funds alone. In England a rate of duty is to be imposed upon funded property different from that which is imposed on other property. This is the very question on which Mr. Pitt defeated Mr. Addington, when the income tax was renewed in 1803. Then I object to the nature of the exemption granted to funded property and to other property; one class being exempted at 502., and the other at 100l. The principle thus violated is one which has always been considered, and which every statesman for the last fifty years has considered, and of which the House has testified its recognition, as a sound principle —that all income, from whatever source derived, must, in justice to the contract on which the fund holder lends his money, be subjected to an equal rate of charge.

LORD JOHN RUSSILL

I am not going to make any observations on the statement which the right hon. Gentleman has made; but I wish to ask a question with regard to the mode in which he intends to proceed with the various propositions which he has laid before the House. He must be aware that with respect to many of those duties, and especially concerning his proposition, the house tax, the country will be very anxious to learn the decision of the House. Indeed, if we were now in February the right hon. Gentleman would expect us to come to a specific Resolution on this subject; but at this season of the year I suppose he will propose some other arrangement by which the public interest will be served. I should wish to know the course which he intends to pursue.

The CHANCELLOR OF THE EXCHEQUER

; I intend to proposer certain Resolutions, and then, if they are acceded to, I shall bring in the necessary Bills. Of course, as regards the duties on tea, I should wish that the reductions should take immediate effect, subject of course to the final decision of the Houseman arrangement which I believe will not be attended with any difficulty. I will propose these Resolutions on the earliest day which will be convenient to the House. I do not at present know the feeling of the House on that subject, and I am afraid to appear to be urging the House to a precipitate conclusion; but if there is no objection I would propose this day week. It is not for me to state to the House the day on which they should take these Resolutions into consideration—it is my wish to give them a fair time for the consideration of the subject— but, as I have already said, if they would not think this day week too precipitate, I will propose the Resolutions on that day.

SIR CHARLES WOOD

said, that he was not going to make any observations on the propositions of the right hon. Gentleman. He merely wished to offer a remark or two upon the course of proceeding to be followed. If the proposition of the right hon. Gentleman were merely to reduce the tea duty, or to increase the house duty, he should think it perfectly possible that Resolutions carrying out those measures might be proposed, discussed, and decided upon on Friday next. But surely the right hon. Gentleman did not propose, with so brief an interval, to pass Resolutions involving a complicated scheme, which it had taken him five hours to explain, involving questions of the most difficult nature, on which the most different opinions might be entertained, and which, as he said, hung very much together. A Gentleman might be perfectly ready to agree to a Resolution for the reduction of the tea duties—which was a matter of no great amount, and which might be dealt with out of the existing surplus; but it could not be supposed that the House would be ready to agree without much consideration to his propositions with respect to the income tax, to the increase of the house duty, or to the reduction of the malt tax. And he thought it was quite essential that before they committed themselves to large reductions of taxation —such as the proposed reduction of the malt tax—they should be quite sure that they were ready to vote the subsequent proposition. Let them be sure of the Ways and Means before they rushed into rash reductions. He was not a little alarmed when, on the first day of the Session, he heard the noble Earl at the head of the Government declare in another place that the final measures to be proposed by the Government to carry out their principles might lead to financial embarrassment. Nor was his alarm diminished by what he had heard that night. If the House was ready to assent to the increased taxes proposed by the right hon. Gentleman, then no doubt the reduction might be effected. But he was sure that no man in his position would think himself justified in making so large a reduction as two-and-a-half millions until he had secured those measures on which he relied to make up the deficiency in the revenue thus created. Nor did he think it likely that he could pass his mea- sures with regard to the income tax, the house tax, and the malt tax, before Christmas, The doubling of the house tax and the reduction of the malt tax were comparatively simple questions; but, with regard to the income tax, the right hon. Gentleman must be aware that by his propositions he would raise four or five questions of vital importance, that he could have no hope of settling before Christmas. He wished to know what course the Government intended to pursue on these questions, and particularly with regard to the income tax and the house tax?

The CHANCELLOR OF THE EXCHEQUER

, who was indistinctly heard, said he had never heard a more ingenious perversion of a speaker's words than that just made of his noble Friend's words by the right hon. Gentleman. The observations of the noble Earl at the head of the Government to which the right hon. Baronet had alluded, had not the slightest reference to anything that he had said or proposed. The noble Earl said that we had embarked on a system that might lead to financial embarrassment; but that the noble Earl had said that anything which he (the Chancellor of the Exchequer) might bring forward might lead to financial embarrassment, was one of the most monstrous statements that he had ever heard made in that House. He firmly believed the measures which he had proposed were as sound as could be proposed, and that they were calculated to conduce to the general welfare. He admitted that his statement had occupied him five hours, and he was very sorry for it, seeing that, besides wearying the Committee, he had given himself a great deal of trouble and labour. He was anxious that the opinion of the House should be taken upon these subjects as soon as possible; and he should, therefore, on Friday next propose to the House Resolutions to carry into effect his recommendations with respect to the reduction of the tea duty and the increase of the house tax. The income and property tax did not expire until the 5th of April, and it was not, therefore, necessary immediately to deal with that; nor should he think of asking the House to consent to the reduction of the malt tax without seeing their way perfectly clear with respect to the means of meeting the deficiency which would be thus created. He never made a proposition in that House of which he did not think that the general effect was to maintain public credit. He would, as he had said, propose on Friday next Resolutions with respect to the reduction of the tea duties and the alteration of the house duties; and if the House agreed to them they would then see their way clear. He thought that that course would be perfectly fair. With respect to the income tax it was certainly proposed by the Government plan that it should be continued for three years, nor did he know that it was necessary, if the House agreed to that proposition, that the Government should state what their intentions beyond that time were. We all knew that the financial system of the country must depend to a certain degree upon direct taxation; but he did not think the income tax was at all the best form in which that direct taxation might take place. He found, however, the country habituated to that tax, which had thus become less objectionable to them; and he knew that if he had proposed a new direct tax to an equal amount, they would not have borne it. He did not, indeed, propose the income tax as a permanent feature of our financial system; for he thought it quite possible, if the same amount of direct taxation were necessary, that a better form might he adopted. He had, however, great confidence in the consuming power of this country, and he thought that it might progress in such a manner that we might ultimately be able to raise our revenue by indirect taxation. He was not prepared to say that the time might not come when it would be possible to raise fifty millions per annum by indirect taxation. The right hon. Gentleman opposite had asked whether it was the intention of the Government to propose the equalisation of the duty on rum. That was not a question on which the Government were prepared to make any proposition. The right hon. Gentleman had also asked whether the Government intended to repeal the duty on foreign malt, which he described as prohibitory. There was no prohibitory duty on foreign malt. There was an absolute prohibition. Now, it was clear that, if the prohibition ceased, we must have a duty on foreign to counteract that on domestic malt, and we must also take into consideration the duty now imposed on foreign barley.

LORD JOHN RUSSELL

said, he wished to make no. objection to the mode of proceeding proposed by the right hon. Gentleman, provided the House were in- formed precisely of what was to be the question before them. As he understood the right hon. Gentleman, he would propose Resolutions on Friday next, by which the tea duty was to be reduced, and the house tax increased. If the right hon. Gentleman would on Monday lay before the House the form of the Resolutions by which he proposed to do this, he (Lord J. Russell) would have no objection to considering the propositions on Friday.

MR. HUME

was glad that this conversation had taken place, because on a question of such a complicated character it was desirable that the House should see its way perfectly clear. He thought it would be right that the House should be called upon to decide whether the income tax was to be a permanent part of the taxation of the country or not. With the exception of the proposition with respect to the light-dues, he agreed entirely with the recommendations of the Chancellor of the Exchequer, every one of which had been urged again and again on that (the Opposition) side of the House; but he must express his great regret that the right hon. Gentleman should have merely proposed to reduce the duty on hops. It ought to have been entirely abolished; for after the proposed reduction of 1d. per pound, the expense of collection would be nearly equal to the revenue raised, while the same amount of vexation consequent upon an excise tax would be left as at present. Then with regard to the malt tax, he was either for removing it altogether, or not touching it at all. The proposed reduction would not destroy the brewers' monopoly, nor remove the inconvenience attending an excise duty; there would be a loss to the revenue without the consumer being benefited thereby. He agreed with the noble Lord that the first question for the House to. consider was, whether they were prepared to agree to the proposed increase of taxation. He thought that if their concurrence in that was to be the condition of the reduction of the duty on tea, he could propose an easier way of making up the deficiency; and that was, by imposing a tax on the descent of real property, which had not yet paid a single shilling, while up to this period 89,000,000l. had been levied on personal property. He thought the time had come when all particular privileges should be done away with, and the whole community should be treated as one interest. It was impossible that the plan proposed should meet with the approbation of the country, setting up, as it did, the country against the town. If the right hon. Gentleman had wished to place our finances on a simple footing, what could have been more easy than to have repealed the house tax, and to have added one per cent to the property tax, which would have been more than would have been required. He objected, also, to the proposed exemption of the land of Ireland from the income tax. He had always called for justice to Ireland; but he was not one of those who would give equality of rights to that country without also calling upon her to bear her fair share of the public burdens, and he thought that no system of taxation that might be adopted would be satisfactory to the country until Ireland was placed on the same footing as England. If the Irish claimed equality of rights, they should also be proud to claim equality of taxation. He thought that the first question to be decided was, whether they should double the house tax. Then with respect to the income tax, the House should decide whether it was to be a permanent part of the revenue of the country, for if it was, they must immediately have a Committee to decide upon the mode in which it should he levied, and whether they would be justified in agreeing to the exemptions proposed by the Government. He should propose that a tax of I per cent on the descent of real property should be added to the house tax. He could not help regretting that the Chancellor of the Exchequer should have fallen short of the principles which he had himself enunciated.

SIR B. HALL

wished to state the course which he should feel it his duty to take when the House went into Committee of Ways and Means. When he sat on the other side of the House he moved, when the continuance of the income lax was proposed last year, that it should be extended to Ireland on the same footing as it was now levied in England. That Motion did not receive the support of the then Government, but it was generally supported by the then Opposition, who now occupied the Ministerial benches. When, therefore, the House went into Committee, he should take the opportunity of again proposing the Resolution which he had moved last year. With regard to doubling the house tax instead of imposing other taxes, he agreed with the remark of his hon. Friend the Member for Montrose, that the Ministerial proposition was one setting town against country; and against that they had to fight.

MR. LABOUCHERE

said, that as to the proposition of the right hon. Gentleman with regard to the shipping interest, he thought he was a little deficient in candour in his statements on that subject. He would have led the House to suppose that since the navigation laws were repealed, nothing had been done in the matter of light-dues, or in any other matter in which the shipping interest was concerned. Now he (Mr. Laboucbere) would go with the right hon. Gentleman in every measure that he proposed for the relief of the shipping interest with the utmost cordiality; but when he proposed to relieve them of 100,000l. of light-dues, he could not help reminding him that since the repeal of the navigation laws, the late Government, in concurrence with the Trinity House, had relieved them of light-dues to a much greater amount than that. Owing to the measures taken by the late Government in concurrence with the Trinity House, the light-dues paid by the coasting trade had been reduced to one-fourth of what they originally were. He had no desire to make any observations on the statement of the right hon. Gentleman, for he felt that the attention of the House was exhausted by the great and complicated questions that had been raised; and any observations upon them would come with much better effect after the propositions of Her Majesty's Ministers had received the deliberate consideration which they deserved. There was, however, one point upon which he felt so strongly that he must say a single word—the point alluded to by his right hon. Friend the Member for the University of Cambridge (Mr. Goul-burn). He said it in no spirit of taunting, but he could not help thinking that the right hon. Gentleman (the Chancellor of the Exchequer) had not considered that part of his Budget by which he proposed to extend the income tax to Irish funded property only, exempting the land of Ireland, and the professional incomes of Ireland—that was, to select for taxation a particular class of property, and that the one which rested on the pledged faith of the country. He was convinced that the right hon. Gentleman had not studied this part of the subject. He could not have read the opinions of Mr. Pitt, Lord Gren-ville, Lord Henry Petty, and of every financier who ever held high office in this country, or he would have seen how grossly Such a proposal violated the principes of public faith; and he was sure that the right hon. Gentleman would be the last man to propose that, for a miserable and paltry sum of 60,000l. per annum, this country should allow a stain to rest for a moment on the national honour. He (Mr. Labouchere) must give up every opinion he had derived from the great men to whom he had referred, if he did not believe that the proposed plan to tax property in the Irish funds, to the exclusion of all other kinds of property in that country, was utterly at variance with every principle upon which the good faith of the country, and the public security in it, rested.

MR. CAYLEY

said, that he believed the sentiments of his right hon. Friend the Chancellor of the Exchequer upon this point had been entirely misunderstood. He was sure that no one who read his Speech would come to the conclusion that he wished to tax the Irish funds to the exclusion of any other kind of property. He understood him to state distinctly that the land and all other property in Ireland were just as amenable to the income tax as any property in this country, but that he would not at this moment impose any increase of taxation upon that part of the property of Ireland which had lately suffered so grievous a calamity. Nor had he heard anything in the lucid statement of his right hon. Friend which was calculated to raise the question of country against town. He had heard many Budgets, but never one more comprehensive and impartial. He meant to deal with all the interests that had been suffering for the last two or three years in what was called the spirit of "recent legislation." With respect to what had fallen from the hon. Member for Montrose, he must observe that he and others who acted with him were favourable to direct taxation until it came to be applied to themselves. Nobody was more favourable to the total repeal of the malt tax than he (Mr. Cayley); but the power of the Chancellor of the Exchequer was limited. He believed that the full benefit of the repeal of that tax would not be felt until the whole was repealed; but he must remind his hon. Friend (Mr. Hume) that he had always opposed propositions for the total repeal. Indeed, not to confine the observations to him, he might remark, that the year before he first brought for ward the question of the repeal of the malt tax in the last Parliament, the hon. Mem- bers for the West Riding (Mr. Cobden) and for Manchester (Mr. Bright) had proposed it; and yet when he introduced his Motion one of these hon. Gentlemen absented himself, and the other opposed it. He trusted that the propositions that his right hon. Friend had made would receive the impartial consideration of the House. Although not committing himself to an unreserved approbation of the whole of them, he begged, on the part of his constituents, to tender to the right hon. Gentleman his thanks for what he conceived to be the best Budget that he had ever heard.

MR. JAMES WILSON

said, he wished to put a question to the Chancellor of the Exchequer with regard to one part of his statement. The only proposition that he had made with respect to the West Indian interest was, that sugar should be permitted to be refined in bond. Now, when that question was discussed two or three years ago, two methods were proposed on which the refining was to be carried on. One was, that the refiners should be permitted either to refine in bond, or to refine sugar on which the duty had been paid; and the other was, that they should be obliged to refine in bond. Now the right hon. Gentleman did not state which of these two methods he intended, to adopt; and as it was of the greatest possible importance to those concerned in sugar refineries to know this as early as possible, perhaps the right hon. Gentleman would now state the course he proposed to pursue. With regard to the observations of the right hon. Gentleman the Member for the University of Cambridge, with respect to the extension of the income tax to Ireland, he must observe that he hoped the House would not depart from the principles on which they had hitherto acted with respect to this tax.

MR. FITZROY

said, that he understood the Chancellor of the Exchequer, in the beginning of his speech, when referring to the burdens of which he was going to relieve the shipping interest, to allude to the duties on marine insurances, at the same time stating that it would be perhaps more convenient to the House that he should mention, in a subsequent part of his speech, the amount of revenue which he was prepared to sacrifice. He thought, however, that the right hon. Gentleman Omitted to state the amount of the sacrifice under that head; and he should be obliged to him if he would now inform the House whether the duties on marine insurance were included in the 100,000l. which he proposed to take off the shipping interest. He wished also for some further explanation with respect to the amount of revenue which the Chancellor of the Exchequer was prepared to abandon; for, while he understood him to say that the reduction on the malt tax would amount to two millions and a half per annum, he also understood him to say that the only loss on this head during the year ending the 10th of October next would be one million, which he should have to pay in drawbacks. He did not understand him to include any part of the remaining million and a half that would be sacrificed. Did none of that, however, come into account in the financial year ending the 5th of April next?

The CHANCELLOR OF THE EXCHEQUER

said, the hon. Gentleman had entirely misunderstood the observations he had made upon the tax on marine insurances. What he had stated was, that the shipping interest had made representations to the Government of the burdens which pressed upon them; and, having treated upon some of these burdens, he came to that of the tax upon marine insurances and charter-parties, and he said that this was a subject which bore upon the general finances of the country, and that therefore he should not now advert to it. In those preliminary observations which he had made he had not entered into details, and in a subsequent portion of his remarks he said that the Government would then confine themselves to those measures only which they were prepared to pass; that the whole question of stamp duties and probate duties had undergone consideration; but, as the Government were not then prepared to recommend any but practical measures, he should not advert to them more particularly. With regard to the malt duty, he had stated that the Treasury would be called upon to repay, by way of drawback, 1,000,000l. to the maltsters, and that therefore there would be a loss to the revenue to that amount in the course of the first year, 1853; and then he calculated that the loss arising from the reduction of revenue in the following year would be 1,700,000l., which made up the amount mentioned by him in his original statement.

MR. MACGREGOR

regretted that the right hon. Gentleman had proposed so long a period as five years for effecting the reduction of the tea- duties to a shilling duty. With regard to the house duty, he thought that it would be far more just to add the amount of it to the income tax and to make it all one impost, than to propose it in a separate form. When these questions should come before them for discussion, he believed that the majority of opinions out of doors would be found to agree with his own.

COLONEL SIBTHORP

owed it as a duty to his country to say that he could not approve of the measures brought forward by the right hon. Gentleman. He (Colonel Sibthorp) was in favour of protection to all British interests; but there was one interest in particular which had been declared by the right hon. Gentleman to be in a state of great suffering, but of which no notice was now taken. With regard to the malt tax, if only half of it were remitted, they would have all the same difficulties and vexatious proceedings that were complained of at present. He had heard from the right hon. Gentleman that poor-rates were diminished. Why were they so low as they were at present? Because the farmers had stepped forward and given protection and relief to the labouring class, in order to keep them from the parish. He, for one, had always objected to the income tax, because it was properly a war tax, and ought not to be imposed in time of peace. But though he disapproved of the right hon. Gentleman's proposals, yet, comparing one Government with another, he must say that the late Government was worth nothing; while it still remained to be proved whether the present Government was wholly worthless, and he was therefore willing to give it his support as far as he could.

MR. CLAY

said, the right hon. Gentleman had not given the House the details of those measures which he had proposed affecting the shipping interest; but, with regard to the spirit of those measures, he begged to offer the right hon. Gentleman his congratulations and thanks for the relief projected. He (Mr. Clay) had voted against the repeal of the navigation laws solely upon the principle that, along with the privileges it took away, it did not take away its burdens also. As the representative of a constituency deeply interested in this question, he was convinced of the necessity of removing these burdens.

SIR J. DUKE

expressed his thanks to the right hon. Gentleman for the interest he had evinced for the welfare of the shipping interest, by giving them that attention to which they were so justly entitled. He wished to ascertain from the right hon. Gentleman, whether it was the intention of the Government to make any alteration in the poor-law settlement and removal, which was a question of great importance affecting the city of London, where the inhabitants were subject to a very heavy tax for the support of casual poor?

MR. HUDSON

could not withhold an expression of the gratification with which he had heard the statement of the right hon. Gentleman with regard to the shipping interest, which would be hailed by his constituents with much pleasure. He rejoiced at the right hon. Gentleman's statement, that the shipping interest would be put now upon a fair footing to compete with foreign countries, and he hoped nothing would prevent the carrying out of the measures contemplated. The timber duties formed another grievance, which he hoped ere long to see redressed.

MR. ALCOCK

begged to tender his thanks to the Chancellor of the Exchequer for his proposal to repeal one-half of the malt tax. He thought that the whole of that tax ought to be done away with; but he was willing to accept the right hon. Gentleman's proposition by way of instalment. With respect to the tea duties, he, for one, was perfectly satisfied with the proposed reduction. He regretted that the Chancellor of the Exchequer had not made up his mind to carry out the income tax to the fullest extent possible, so that every man in the country might be taxed, be his income what it might.

MR. FREWEN

felt bound heartily to thank the right hon. Gentleman the Chancellor of the Exchequer for the very able statement he had put before them, and for a plan which he believed would, in various ways, be beneficial to his constituents. He wished particularly to call attention to one subject in which a great proportion of his constituents were interested—he meant the heavy dues at present levied on shipping in the shape of passing tolls. He did not know whether the right hon. Gentleman was acquainted with the system of taxes on shipping established in France, which he thought well worthy of being adopted in this country. Every ship which went into a French harbour knew what it had to pay for harbour dues, whilst it had nothing to pay for lights. This was a matter in which improved regulations were loudly called for, as many of our harbours were in a disgraceful state. With regard to the proposal to take off half the malt tax, he was strongly of opinion that this would lead to but a trifling loss of revenue. On the subject of the hop duty; he would not now pledge himself as to moving any Amendment on the Ministerial proposition, feeling bound in the first instance to consult his constituents. For the plan in general he again begged to thank Her Majesty's Government.

Resolution put, and agreed to.

A second Resolution, "That a sum not exceeding 2,000,000l. be granted to Her Majesty for defraying a like amount of supplies voted for the service of the year 1852 and the preceding year," was then put from the chair, and agreed to.

MR. LABOUCHERE

inquired whether the right hon. Gentleman would lay on the table on Monday the precise terms of the Resolutions on which his measures were to be founded.

The CHANCELLOR OF THE EXCHEQUER

answering in the affirmative,

House resumed.

The House adjourned at a quarter after Eleven o'clock till Monday next.