HC Deb 12 April 1853 vol 125 cc1041-54

said, the Motion he was about to move was one which deeply affected the economical management and collection of the public revenue, and the character of the House as protector of the public money. His object was to obtain an assurance from the House that they would not permit any portion of the public taxes to be expended by any persons whatsoever without its concurrence and authority. He considered this duty was one of the most important and peculiar functions of the House of Commons. But he regretted to say that this duty had been for a long period most culpably neglected, by allowing a large portion of the public revenue to be intercepted in its way from the pockets of the people to the public Exchequer. It appeared from a return which he moved for, and which was presented to the House in the course of the present Session, that in the year 1851 the large amount of 6,000,000l. had been intercepted in this way. Of this sum 3,936,000l. had been impounded by the officers of the revenue departments—the customs, excise, stamps, taxes, post office, &c., to pay their own salaries. A very large amount had been detained for the purpose of repayments and drawbacks, and 560,000l. under the denomination of "other payments." Now, what were these "other payments?" In the Customs, they were described for quarantine and warehouses, and judicial establishments in Scotland 313,000l. In the Excise, the payments other than the cost of collection consisted of pensions granted in the reigns of King Charles II. and William III., salaries to the inspectors of corn returns, payments towards the civil Government of Scotland, for the encouragement of British fishing, for the salaries of process servers, and allowances to the officers of the late tax department in Ireland, &c. In this way 84,679l. was expended. Then there was a sum of 130,000l. unaccounted for by the Woods and Forests department. He contended that the whole of this amount of 6,000,000l. ought to be paid into the public treasury, and that votes ought to be taken in the Estimates for the various revenue departments, as for the Army, Navy, Ordnance, and Civil Services Estimates. He had heard it said that there were difficulties in the way of effecting this; but he would undertake to remove them, and he was sure the Chancellor of the Exchequer could very easily surmount them. The House would be astonished to find what had been the result of the expenditure of such an enormous sum of money without control or supervision. In the year 1806, a period of war and extravagance, a Committee was appointed by a Whig Government to inquire into the cost of collecting the revenues, and as the result of the inquiry, it appeared that the cost of collecting 58,000,000l. was 2,797,000l., or about 4¾ per cent., and it was about the same for the ten preceding years. The expense of collecting the revenue of 1851, which was 56,000,000l., was 3,936,000,l., being about 7 per cent, or 1,140,000l. in excess of the cost of collecting 2,000,000l. less revenue in 1806. Moreover, in 1806, the Post Office packet service was maintained and paid by the Post Office department, which was not the case at present; and if this item of expense were added to the 1,140,00l., there would be a sum of 2,000,000l. more for collecting the revenue in 1851, than was paid in 1806. It must also be taken into account that the price of wheat in 1806 was 76s. per quarter, and in 1805 wheat was at 86s. per quarter, or pretty nearly double its cost at the present time. Now the cost of almost every article that entered into the consumption of those who were employed in the collection of the revenue, was in 1851 one-third less than in 1806, and yet there had been that enormous increase in the expense of collecting the revenue in the former year to which he had just called the attention of the House. That circumstance could, in his opinion, be accounted for solely upon the ground that that expenditure had taken place without any control upon the part of that House. When the late Sir Robert Peel immediately after his accession to office in 1841 stated in that House the great increase of expenditure over revenue, and an income tax was "looming in the future," he (Mr. Williams) suggested to him, as one means of making up the deficiency, the adoption of the change which he now proposed. A fortnight after, to his great surprise, Sir Robert Peel appointed a Commission, at the head of which was the late Lord Granville Somerset—a most able man—his colleagues in the inquiry being gentlemen connected with the Government. The Commission went to Liverpool, and made a searching inquiry into the system of collectting the revenue in that place, and ultimately made a most able Report. They pointed out the gross mismanagement which pervaded the whole system of collection at Liverpool; they spoke of the incredible inconvenience to which the merchants there were subjected, by the circumstance that a great number of officers worked only from ten in the morning till three in the afternoon, adding, that although the merchants offered to pay the officers out of their own pockets double what they received, provided they were employed ten hours instead of five, this offer was rejected, as inconsistent with the Customs regulations. The Commission stated, "the inference that this establishment is too large, appears to us irresistible." The discoveries which they made, convinced them that the system of collecting the revenue was extravagant and corrupt from one end of the Kingdom to the other. In point of fact, they did not extend their inquiry to any other place; and he (Mr. Williams) having repeatedly asked for information with regard to the progress made by the Commission, in further inquiry, was at last informed by Sir Robert Peel that the Commission was abolished. What, however, was the result? In 1842 the articles subjected to duty were about 800 in number; the number had since been reduced by 420, the reductions amounting in money to 9,500,000l. The Customs revenue in 1842 was 21,800,000l. the cost of collecting it being 1,254,000l.; in 1851 the charge for collection of 20,600,000l. was 1,290,000l., or 36,000l. more than the amount in 1842, notwithstanding the diminution of the number of duty-paying articles by one-half. A Return which he had obtained showed the extraordinary fact that the new places in the revenue departments from 1841 to 1851 amounted to 1,274, of which number 520 were in the Customs. The superannuation allowances in the Customs and Excise in 1841 amounted to 283,000l.; in 1851, the amount had risen to 360,000l., being an increase of 83,000l., although there was 500,000l. less revenue to collect. On this point he begged to refer to the Third Report of the Committee of Finance, of which Sir Henry Parnell, the ablest financier of his day, was the chairman. That Committee stated that— abuses had arisen from the disposition of the superior officers to favour the retirement of efficient clerks, and that they had been informed that not a few persons superannuated as unfit for public service, had enjoyed health and strength long afterwards to discharge active duties in other public offices and in private business. It was also observed by the late Marquess of Lansdowne in the House of Lords, that every public office seemed to be the lord of its own will, and to have unlimited power over the pocket of the nation, instead of being, as the constitution required, under the control and check of Parliament. All the abuses arose from the circumstance of the proceedings being conducted in secret, and without the control of Parliament. The vexatious proceedings of the Customs department had within the last twelve months excited the active hostility of the merchants of the City of London, who declared that they would endure them no longer; and, in consequence of the representations made by them, the Government had promised that the evils complained of should be remedied. What was the course pursued with regard to the docks? Upon the information of discarded servants of the dock companies, a body of forty officers was sent to the docks; 120 informations were prepared, proceedings were taken, and some twenty persons, who had been servants of the companies for a lengthened period, were required to find bail as the condition of escaping imprisonment. Out of the 120 informations one case was tried; it cost the Dock Company 10,000l. to defend the suit; and the verdict was, that some irregularity had taken place with regard to what was of the value of 6l., the duty payable being 27s., the Court entirely exonerating the company from any intention to commit a fraud. What the proceedings cost the Government he did not know, but probably it was not less than the expense to the company. All the other informations were abandoned, as well as prosecutions of the officers and servants of the Dock Companies after putting them to great expense and inconvenience. Was a system to be endured which inflicted so much hardship on the merchants who conducted the import and export trade of this country, and equal hardship on the dock companies and the owners of bonding warehouses? He would just refer to the Report of a Commission appointed in 1831, shortly after the accession to office of the late Earl Grey, consisting of the most influential Members of the Government. The Commission, in their report, after observing that the Exchequer was the great conservator of the revenue of the nation, said the public money should be placed, without reduction, in the custody of the Exchequer, and accounted for to Parliament, whose authority should be necessary for the appropriation of the whole. They further said— We feel this principle to be of paramount importance to the security of the public money. We think no portion of the public money should be arrested on any plea or pretence whatever on its way to the Exchequer; and that no portion of it should be issued from the Exchequer without previous Parliamentary sanction. The Commissioners went on to say that they referred with satisfaction to the existence of a similar regulation with regard to the administration of the finances in France—a regulation which in that country had been productive in its operation of very beneficial results. That Report was signed by Sir Henry Parnell, Sir James Kempt, Master General of the Ordnance, Mr. Charles Poulett Thompson, President of the Board of Trade, Lord John Russell, Sir James Graham, Sir Francis Baring, and the Right Hon. Edward Ellice. Nettling could be more emphatic or decisive than the language in which these high authorities condemned the existing system. Let the House consider in what way the department had conducted its proceedings since that Report was made. Previous to the time of Mr. Pitt, the cost of collecting the taxes of the country had not amounted to more than 2 or 3 per cent, whereas at the present day the expense of collection was not less than 8¼ per cent, including the cost of the packets for the service of the Post Office. About six years ago a Commission was appointed to investigate the subject of alleged frauds in the Customs. They stated in their Report that there were two accounts, one of which was in the light of a private account kept in the name of the receiver general and the comptroller general of the customs for the purpose of paying salaries and the other purposes he had mentioned—a private account of 6,000,000l. of taxes received from the people, and expended without Parliamentary control. In 1848 Dr. Bowring brought forward a Motion similar to that now before the House. A majority voted in favour of it, but to that hour it had never been carried out. The noble Lord the Member for the City of London (Lord J. Russell) had urged as an excuse that it would occupy too much of the time of the House to go through the salaries of all the officers who collected the revenue. Why, the other evening, they had nearly disposed of the salaries of another department at one fell swoop; and whatever might be said with regard to the difficulties of revision, there should at least be an opportunity of comment with regard to the salaries of all public officers. It would be in the recollection of the House that about two years ago Lord Duncan, after having meritoriously investigated the management of the Crown property under the Woods and Forests, succeeded in carrying a Resolution declaring that all the receipts of such property ought to be paid into the Exchequer. Notwithstanding that Resolution, however, there was upwards of 100,000l. in the department unaccounted for, and he hoped the right hon. Baronet at the head of that department would be prepared to give some explanation of that circumstance. He (Mr. Williams) could, however, partly account for it himself. There were about 230 rangers, deputy rangers, lodges, mansions, &c. in the Royal parks. Of the many lodges, which, in some cases, were in fact mansions, upon which a large amount was spent annually, only a small expenditure on one of them was at all accounted for. He entertained great hopes that an entire change of system with regard to Government departments was at hand. The right hon. Gentleman the late Chancellor of the Exchequer, observed in his speech on introducing his Budget, that one part of the duty of the then Government would be to pay the whole of this 6,000,000l. into the Exchequer. So deeply did the right hon. Member for Buckinghamshire seem impressed with the justice and necessity of such a measure, that he repeated his statement in his reply. Last Friday night the House had a lecture from the present Chancellor of the Exchequer with respect to what the right hon. Gentleman conceived to be the duty of that House, and of the Members of that House. The right hon. Gentleman said— No man more fully admits than I do the perfect right of Parliament, and of every Member of Parliament—nay, the bounden duty and obligation of Parliament, to maintain intact its control over the whole of these operations. If it is your duty to fence about with minute, stringent, and rigid forms the whole process of taxation, and to look jealously and keenly into every proposition submitted by the Government for raising money from the people, I will venture to say that it is still more your duty to see that you do not give a blind and unreasoning confidence in a matter where the question is, if not about the imposition of taxes, yet about that which is more delicate—namely, either the creation or commutation of public debt; and the more the House takes on itself that function, the less becomes the responsibility of the Government. Thus had the right hon. Gentleman, in language most eloquent, most decisive, and most constitutional, described the position and duty of that House with regard to the revision of taxes. He felt sure, therefore, that the right hon. Gentleman would use similar language that evening; and declare that it was the duty of that House, after imposing taxes on the people, to see that no portion of them was expended indepen- dently of its own authority and control. After quoting such a declaration of opinion from the right hon. Gentleman, it would be presumptuous in him to detain the House any longer, and he would therefore conclude at once with the Motion of which he had given notice.


in seconding the Resolution, adverted to the intimation made by the late Chancellor of the Exchequer, of which the hon. Member for Lambeth (Mr. W. Williams) had reminded the House, that the disposition of the Government with which that right hon. Gentleman was connected was to bring the large sum paid for collecting the public revenue under the supervision of the House of Commons. He was ready to thank the right hon. Gentleman then, and he thanked him now, for the example which, as one holding high office, the right hon. Gentleman had given to his successors. It had been stated that upwards of 1,000,000l. of money would be saved by this means; but it was enough for the House of Commons that it was expenditure out of sight. That was not an English mode of expenditure; hon. Members did not allow it to their own stewards. They ought to do in public life what they did in private life, so that the public money should be properly accounted for to those who were the guardians of the public purse. The money to which the Resolution related was either properly or improperly spent. If improperly spent in any degree, it was necessary that the House of Commons should investigate the matter; if properly spent, it would be satisfactory to the Ministers of the day, as public servants, that they had it in their power to explain the expenditure of the country. Dr. Bowring, who formerly used to bring forward Resolutions on this subject, had been appointed a Consul in China, as another hon. Member, Sir Henry George Ward, by whom Resolutions had been brought forward on other subjects, had been sent as Governor to the Ionian Islands; and so it might be thought of to deal with the hon. Member for Lambeth, if he persevered. Though the House was crowded last night, when the question of the Canada Clergy Reserves, involving a few thousands, was discussed, so few were present to night, when the question involved mllions, that at one time it appeared as if the House would have been counted out. He had risen, however, principally to give the meed of praise which he thought due to the late Chancellor of the Exchequer, who had paved the way for bringing this expenditure under the cognisance of the House of Commons, and whom he thanked, not only for having done so, but for telling the House, on authority perfectly worthy of belief, that if the administrative departments were subjected to thorough investigation, a saving of some millions might be effected—a saving, it might be observed, which would perhaps exceed any to arise from dealing with the public stocks.

Motion made, and Question proposed— That it appears by a Return ordered by this House in the present Session, that an enormous amount of the public money is annually intercepted on its way from the people's pockets to the Treasury, and expended without the sanction and control of this House, and in violation of the constitutional principle, that no Taxes shall be imposed upon the people, or the product thereof expended, without the authority of their Representatives in Parliament. That the said Return shows, that the amount intercepted and expended in the year 1851, which never reached the Exchequer, was 6,072,151l. 9s. 9d., of which amount 5,622,257l. was deducted from the gross receipts of the Taxes by the various Revenue Departments, and expended by the said Departments for the payment of their Officers, and other purposes, without the supervision and control of Parliament. That, for the security of the Public Monies, and accurate keeping of the Public Accounts, it is indispensable that the whole of the Public Income should, without any deduction whatever, be paid into Her Majesty's Exchequer, and that no portion of it should be issued therefrom, on any plea or pretence, without the sanction of Parliament, as it was recommended by the Commission, which consisted of Members of this House, appointed by the Crown in the year 1831.


said, that the task he had to discharge upon the present occasion was an extremely simple one, both as regarded himself and as regarded the Government. As regarded himself he had to state that he had many years ago expressed in that House an opinion that the charge for the collection of the revenue of this country ought, if possible, to be brought under the control of Parliament. As regarded the Government, he had to state that he had himself, since he had been appointed to his present office, thought fit to inquire into the practicability of effecting that great change; and that the subject had undergone some consideration on his part, and on the part of his Colleagues. As an abstract opinion was of very little consequence in itself, they were of opinion that effect ought to be given to that principle, and they did not mean to desist from their endeavours until they should have organised a measure for carrying out that object. The hon. Gentleman, however, must be well aware that the operation would be a very considerable one, and that a good deal should be done before a perfectly good and clear and simple system of dealing with a subject of such magnitude could be established. The hon. Gentleman must know well that there was a large class of charges included in the gross sums he had inserted in his Resolutions, which it would be impossible to bring under the control of Parliament, for the simple reason that they did not, in any proper sense, constitute a portion of the public income. The hon. Gentleman could not wish that drawbacks and repayments—that sums which had been received in error, and which should be returned to the contributors, but which formed a considerable portion of the total he had enumerated, should be introduced into the public accounts under the head of income, in order that they might afterwards be discharged from the public accounts under the head of expenditure. The hon. Gentleman must also be aware that there were many charges imposed on the public revenue by Acts of Parliament. There was, for instance, the charge—not a very extensive one now—which was called the "hereditary pensions," and which was thrown on separate branches of the public revenue. He (the Chancellor of the Exchequer) did not think that any advantage could be gained by making those hereditary pensions subject to an annual vote of Parliament. The best way to deal with them, in his opinion, would be to make an arrangement—a voluntary and optional arrangement with the pensioners, and to offer them reasonable terms of accommodation, so that the public accounts might afterwards be discharged of those items altogether. In other cases there were public charges which Parliament had been pleased—he could hardly say in its wisdom—to impose on particular branches of the revenue; such as, for instance, the Scottish judicial establishments, which were charged on the Excise. Those were arrangements which he should say were obviously quite indefensible, and ought to be altered. He believed, however, that everything that properly belonged to the expenditure of the public income ought unquestionably to be brought under the control of Parliament, and that we should never establish a sound system of national finance until that principle should be carried fully into effect. But he confessed that he was not so sanguine as the hon. and gallant Gentleman who had last addressed the House with respect to the immense saving to be effected by that process. The hon. Gentleman the Member for Lambeth (Mr. W. Williams) had stated that the charge for collecting the revenue of this country amounted to 8¼ per cent on the gross sum received; and in that charge he had included the cost of the Post Office packet service. He had spoken of that service as a portion of the machinery for collecting the revenue of the country. But he (the Chancellor of the Exchequer) entirely differed from the hon. Gentleman upon that point; he looked on the packet service as a means of scattering and squandering the public revenue. But however that might be, that service was unfortunately brought under the control of that House, and nothing could be worse than the mode in which it had been managed. He was bound to express his conscientious belief that if it had been exclusively under the management of a Government Department, the expenditure would have been conducted with much greater economy than it had hitherto been. But the hon. Gentleman was probably aware that such measures as could be taken were being taken at present in order to effect every possible improvement in all the different branches of the public expenditure. He (the Chancellor of the Exchequer) should be very sorry to have it supposed that it was his intention to imply the slightest censure on those who had administered the system which he had described as so unsound in principle. He could not, therefore, agree to the terms of the Motion of the hon. Gentleman as it then stood. He hoped that he might appeal with effect to the hon. Gentleman not to call on the House to assent to the Motion in a formal shape, because the terms of it were such, that although he did not at all find fault with it as a vigorous expression of the views and opinions of the hon. Gentleman, yet he thought that if it were adopted by the House, and if it became a public document, it would seem to convey a censure which was not really deserved, and which he was sure it was not the desire of the hon. Gentleman himself to express. The hon. Gentleman stated, in the first portion of his Resolution, that— an enormous amount of the public money is annually intercepted on its way from the people's pockets to the Treasury, and expended without the sanction and control of this House, and in violation of the constitutional principle that no taxes shall be imposed upon the people, or the product thereof, expended without the authority of their Representatives in Parliament. Now he (the Chancellor of the Exchequer) had already said in the broadest manner that he wished to give such a construction to the principles of Parliamentary control as would bring all those charges under its operation. But he was l0th to say that a constitutional principle had been violated by the present practice, because that practice had uniformly prevailed in this country in all periods of its history and under all systems of government, and because he believed that the supervision of the expense of collecting the revenue was part of the known and established prerogatives of the Crown. He did not propose to stickle for the retention of prerogatives of the Crown; it appeared to him that it would be better to part with them; but, at the same time, he was not at all disposed to imply any censure on these administrative departments which had been engaged in carrying out the system as they had found it. He should further say that he was convinced that a spirit, not only of perfect integrity, but of enlightened economy, had prevailed among the heads of our great public departments. He felt bound to discourage expectations which appeared to him to be extravagant; but he did not say that they would effect no saving by the contemplated change; on the contrary, he believed that the mere fact of their bringing that expenditure under the control of Parliament would greatly strengthen the heads of the public departments in their attempts to deal with it in the most efficient and economical manner, and would lead, if he should not be greatly disappointed, to a good deal of retrenchment. All he wished was that it should be understood that they could not look to anything like a saving of millions every year from the adoption of the proposal, and, above all, that it should be understood that they were not insensible to the services of such men as Mr. Wood, the chairman of the Board of Inland Revenue, and Sir Thomas Fremantle, the chairman of the Board of Customs, who were, he was sure, themselves ready to carry out to the best of their power the principle of public economy and retrenchment. He wished not to discourage or to supersede them, but to strengthen their hands. That, he thought, was the spirit in which they ought to deal with the question. The Government officers were already engaged in investigating these departments one after another, in order that they might ascertain how they could best give effect to the principle to which he had already deliberately given the adhesion of Her Majesty's Ministers. With respect to the Board of Inland Revenue, which collected nearly three-fifths of the public income, the investigation had already been carried to an advanced stage. The state of the Post Office department was at present under consideration. In that great department, when they spoke of the charges of collection, they should remember that those charges were not incurred for the mere raising of a particular sum of money, but for an immense system of distributing letters for the accommodation of the country, which it might be extremely difficult to bring under the supervision of Parliament, although he admitted that it was desirable to promote as far as possible that object. After those explanations, which he trusted would be satisfactory to the hon. Gentleman, and to the House, he would conclude by expressing a hope that the hon. Gentleman would not call on them to assent to the terms of his Resolution.


said, he did not agree with the right hon. Gentleman as to the objection he had made to the terms of the Resolution. He contended—and the right hon. Gentleman had laid down the principle emphatically in the quotation which he made from the Resolution—that every item of taxation ought to be under the authority of the House, and equally was it established that they should look to the expenditure. The Crown had no power to put its hand into the pockets of the people without the authority of the other two branches of the Legislature. The Crown had no power to appoint a whole host of Customs and Excise officers without the authority of that House, and give them what salary it pleased. He knew for a fact that some of the ablest officers in these departments had been induced to resign their situations in the prime of life to make room for others. However, he was sure that Her Majesty was the last person in the realm that would attempt to invade such a principle. The right hon. Gentleman had met the question, he must say, in a very fair way. He was uncommonly gratified that he had done so in the clear and off-hand manner in which he had just expressed himself. He would rather leave it in his hands, with the high opinion he had of his good intentions, and also of the integrity with which he would endeavour to carry out the principle. He should, therefore, not press the Motion.

Motion, by leave, withdrawn.